Exhibit 10.1

 

Membership Interest Purchase Agreement

 

This Membership Interest Purchase Agreement (this “Agreement”), dated as of May
28, 2020 (the “Effective Date”), is entered into between HaloVax, LLC, a
Delaware limited liability company (the “Company”), and Hoth Therapeutics, Inc.,
a Nevada corporation (“Purchaser”).

 

Recitals

 

WHEREAS, the Company wishes to sell to the Purchaser, and Purchaser wishes to
purchase from the Company, a percentage of the Company’s outstanding membership
interests (the “Membership Interests”), subject to the terms and conditions set
forth herein.

 

NOW, THEREFORE, in consideration of the mutual covenants and agreements
hereinafter set forth and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:

 

1. Subscription. The Purchaser, intending to be legally bound, hereby
irrevocably agrees to purchase one percent (1%) of the Company’s outstanding
Membership Interests (the “Membership Interests”) as of the Closing Date (as
defined below) for a purchase price of $100,000.

 

2. The Offering. The offering of the Membership Interests contemplated hereby
(the “Offering”) is being made in reliance on the exemption from registration
provided in Section 4(a)(2) of the Securities Act of 1933, as amended (the
“Act”).

 

3. Deliveries and Payment.

 

(a) Simultaneously with the execution hereof, the Purchaser shall deliver to the
Company a completed and executed signature page to this Agreement.

 

(b) The Membership Interests will be issued and sold by the Company to the
Purchaser at a closing (the “Closing”) to occur on or before June 15, 2020 (the
“Closing Date”). At the Closing, the Company shall issue and sell to the
Purchaser and the Purchaser shall purchase from the Company the Membership
Interests.

 

(c) On or before the Closing, the Purchaser shall make a wire transfer payment
in the full amount of the purchase price for the Membership Interests to an
account specified in writing by the Company.

 

4. Acceptance of Subscription. The Purchaser understands and agrees that the
Company, in its sole discretion, reserves the right to accept or reject this
subscription or any other subscription for the Membership Interests, in whole or
in part, notwithstanding prior receipt by the Purchaser of notice of acceptance
of a subscription. The Company shall have no obligation hereunder until the
Company executes and delivers to the Purchaser an executed copy of this
Agreement. If any subscription is rejected in whole or in part or the Offering
is terminated, all funds received from the Purchaser will be returned without
interest or offset, and this Agreement shall thereafter be of no further force
or effect.

 

 

 

 

Within five (5) calendar days of the Closing, the Company shall deliver the
Membership Interests to the Purchaser at the address set forth on the signature
page hereto.

 

5. Representations and Warranties.

 

The Company hereby represents and warrants to Purchaser as of the date of this
Agreement as set forth below.

 

(a) The Company is a limited liability company duly organized, validly existing
and in good standing under the laws of the State of Delaware. The Company has
all requisite power and authority to (1) own and operate its properties and
assets, (2) execute and deliver this Agreement, (3) issue and sell the
Membership Interests, (4) carry out the provisions of this Agreement, and (5)
carry on its business as presently conducted and as presently proposed to be
conducted. The Company is duly authorized to do business and is in good standing
in all jurisdictions in which the nature of its activities and of its properties
makes such qualification necessary, except for those jurisdictions in which
failure to do so would not have a material adverse effect on the Company or its
business.

 

(b) All action on the part of the Company, its officers, board of managers and
members necessary for the authorization of this Agreement, the performance of
all obligations of the Company hereunder at the Closing and the authorization,
sale, issuance and delivery of the Membership Interests pursuant hereto has been
taken or will be taken prior to the Closing. This Agreement, when executed and
delivered, will be a valid and binding obligation of the Company enforceable in
accordance with its terms except (1) as limited by the applicable bankruptcy,
insolvency, reorganization, moratorium or other laws of general application
affecting enforcement of creditors’ rights, and (2) general principles of equity
that restrict the availability of equitable remedies.

 

(c) The execution, delivery and performance by the Company of this Agreement and
the consummation by the Company of the transactions contemplated hereby do not,
and will not, (i) conflict with or violate any provision of the Company’s
certificate or articles of organization, bylaws or other organizational or
charter documents, (ii) in any material respect, conflict with, or constitute a
default (or an event that with notice or lapse of time or both would become a
default) under, or give to others any rights of termination, amendment,
acceleration or cancellation (with or without notice, lapse of time or both) of,
any agreement, credit facility, debt or other instrument (evidencing a Company
debt or otherwise) or other understanding to which the Company is a party or by
which any property or asset of the Company is bound, or affected, or (iii) in
any material respect, result in a violation of any law, rule, regulation, order,
judgment, injunction, decree or other restriction of any court or governmental
authority to which the Company is subject (including, assuming the accuracy of
the representations and warranties of the Purchaser set forth in this Section 5,
federal and state securities laws and regulations and the rules and regulations
of any self-regulatory organization to which the Company or their respective
securities are subject, including all applicable trading markets), or by which
any property or asset of the Company is bound or affected, except in the case of
clauses (ii) and (iii) such as would not, have a material adverse effect on the
Company or its business.

 

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The Purchaser hereby acknowledges, represents, warrants, and agrees as follows:

 

(a) The Purchaser is a corporation duly organized, validly existing and in good
standing under the laws of the State of Nevada with the requisite corporate
power and authority to enter into and to consummate the transactions
contemplated by this Agreement and otherwise to carry out its obligations
hereunder. The purchase by the Purchaser of the Membership Interests hereunder
has been duly authorized by all necessary corporate action on the part of the
Purchaser. This Agreement has been duly executed and delivered by the Purchaser
and constitutes the valid and binding obligation of the Purchaser, enforceable
against it in accordance with its terms, except (i) as limited by general
equitable principles and applicable bankruptcy, insolvency, reorganization,
moratorium and other laws of general application affecting enforcement of
creditors’ rights generally, and (ii) as limited by laws relating to the
availability of specific performance, injunctive relief or other equitable
remedies.

 

(b) None of the Membership Interests are registered under the Act, or any state
securities laws. The Purchaser understands that the offering and sale of the
Membership Interests is intended to be exempt from registration under the Act by
virtue of Section 4(a)(2) thereof based, in part, upon the representations,
warranties and agreements of the Purchaser contained in this Agreement.

 

(c) The execution, delivery and performance by the Purchaser of this Agreement
and the consummation by the Purchaser of the transactions contemplated hereby do
not and will not (i) result in a violation of the organizational documents of
the Purchaser or (ii) conflict with, or constitute a default (or an event which
with notice or lapse of time or both would become a default) under, or give to
others any rights of termination, amendment, acceleration or cancellation of,
any agreement, indenture or instrument to which the Purchaser is a party, or
(iii) result in a violation of any law, rule, regulation, order, judgment or
decree (including federal and state securities laws) applicable to the
Purchaser, except in the case of clauses (ii) and (iii) above, for such that are
not material and do not otherwise affect the ability of the Purchaser to
consummate the transactions contemplated hereby.

 

(d) The Membership Interests to be received by the Purchaser hereunder will be
acquired for such Purchaser’s own account, not as nominee or agent, and not with
a view to the resale or distribution of any part thereof in violation of the
Act, and the Purchaser has no present intention of selling, granting any
participation in, or otherwise distributing the same in violation of the Act
without prejudice, however, to the Purchaser’s right at all times to sell or
otherwise dispose of all or any part of such Membership Interests in compliance
with applicable federal and state securities laws. The Purchaser is not a
broker-dealer registered with the Securities and Exchange Commission (“SEC”)
under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or
an entity engaged in a business that would require it to be so registered.

 

(e) The Purchaser, either alone or together with its representatives, has such
knowledge, sophistication and experience in business and financial matters so as
to be capable of evaluating the merits and risks of the prospective investment
in the Membership Interests, and has so evaluated the merits and risks of such
investment. The Purchaser understands that it must bear the economic risk of
this investment in the Membership Interests indefinitely, and is able to bear
such risk and is able to afford a complete loss of such investment.

 

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(f) Neither the SEC nor any state securities commission or other regulatory
authority has approved the Membership Interests, or passed upon or endorsed the
merits of the Offering or confirmed the accuracy or determined the adequacy of
any information provided by the Company to the Purchaser in connection with the
Offering.

 

(g) The Purchaser has had an opportunity to receive all information related to
the Company requested by it and to ask questions of and receive answers from the
Company regarding the Company, its business and the terms and conditions of the
Offering of the Membership Interests.

 

(h) The Purchaser is unaware of, is in no way relying on, and did not become
aware of the Offering through or as a result of, any form of general
solicitation or general advertising.

 

(i) The Purchaser has taken no action that would give rise to any claim by any
person for brokerage commissions, finders’ fees or the like relating to this
Agreement or the transactions contemplated hereby (other than commissions, if
any, payable by the Company pursuant to the terms of any contract to which the
Company is a party).

 

(j) The Purchaser is aware that an investment in the Company is subject to
substantial risks.

 

(k) At the time the Purchaser was offered the Membership Interests, it was, and
at the date hereof it is an “accredited investor” as defined in Rule 501(a)
under the Act or a “qualified institutional buyer” as defined in Rule 144A(a)
under the Act.

 

(l) It is understood that the certificates representing the Membership Interests
will bear the following legends:

 

THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED WITH THE SECURITIES
AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE
UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, AND, ACCORDINGLY, MAY NOT BE TRANSFERRED UNLESS (I) SUCH MEMBERSHIP
INTERESTS HAVE BEEN REGISTERED FOR SALE PURSUANT TO THE SECURITIES ACT OF 1933,
AS AMENDED, (II) SUCH MEMBERSHIP INTERESTS MAY BE SOLD PURSUANT TO RULE 144, OR
(III) THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO
IT THAT SUCH TRANSFER MAY LAWFULLY BE MADE WITHOUT REGISTRATION UNDER THE
SECURITIES ACT OF 1933, AS AMENDED.

 

TRANSFER OF THE MEMBERSHIP INTERESTS REPRESENTED HEREBY IS RESTRICTED PURSUANT
TO THE TERMS OF AN AGREEMENT BETWEEN THE COMPANY AND THE INITIAL PURCHASER OF
THIS SECURITY AND THE COMPANY’S OPERATING AGREEMENT, AS APPLICABLE. ANY
PURPORTED TRANSFER IN VIOLATION OF SUCH AGREEMENT IS NULL AND VOID, AB INITIO.

 

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6. Tag-Along Rights.

 

(a) Tag-Along Rights.

 

(i) If the Company wishes to sell, give, assign, hypothetic, pledge, encumber,
grant a security interest in or otherwise dispose of (whether by operation of
law or otherwise) (each a “Transfer”) fifty percent (50%) of its Membership
Interests to a third-party purchaser, then the Purchaser shall have the right to
sell to such third-party purchaser, upon the same terms and conditions as the
Company, up to that number of Membership Interests held by the Purchaser equal
to that percentage of the number of Membership Interests proposed to be
Transferred by the Company determined by dividing the total number of Membership
Interests then owned by the Purchaser by the total number of Membership
Interests then owned by the Company.

 

(ii) The Company shall give written notice to the Purchaser of each proposed
sale by it of Membership Interests which gives rise to the rights of the
Purchaser set forth in this Section 6(a) at least fifteen (15) days prior to the
proposed consummation of such sale, setting forth the number of Membership
Interests proposed to be sold, the name and address of the proposed third-party
purchaser, the proposed amount and form of consideration and terms and
conditions of payment offered by such third-party purchaser, the percentage of
Membership Interests that the Purchaser may sell to such third-party purchaser
(determined in accordance with Section 6(a)), and a representation that such
third-party purchaser has been informed of the “tag-along” rights provided for
in this Section 6(a) and has agreed to purchase Membership Interests in
accordance with the terms hereof. The tag-along rights provided by this Section
6(a) must be exercised by the Purchaser pursuant to this Section 6(a) within ten
(10) days following receipt of the notice required by the preceding sentence, by
delivery of a written notice to the Company indicating the Purchaser wishes to
exercise its rights and specifying the number of Membership Interests (up to the
maximum number of Membership Interests owned by the Purchaser required to be
purchased by such third-party purchaser) it wishes to sell. The failure of the
Purchaser to respond within such 10-day period shall be deemed to be a waiver of
the Purchaser rights under this Section 6(a), provided that the Purchaser may
waive its rights under this Section 6(a) prior to the expiration of such 10-day
period by giving written notice to the Company. If a third-party purchaser fails
to purchase Membership Interests from the Purchaser pursuant to this Section
6(a), then the Company shall not be permitted to consummate the proposed sale of
its Membership Interests unless and until, simultaneous with such sale, the
Company purchases from the Purchaser the number of Membership Interests the
Purchaser is entitled to sell under this Section 6(a) on the same terms and
conditions as the Company is Transferring its Membership Interests to the
third-party purchaser.

 

(b) General. Any attempt to Transfer any Membership Interests or any rights
thereunder in violation of this Agreement shall be null and void ab initio.

 

7. Modification. This Agreement shall not be modified or waived except by an
instrument in writing signed by the party against whom any such modification or
waiver is sought.

 

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8. Notices. Any notice or other communication required or permitted to be given
hereunder shall be in writing and shall be deemed effectively given: (a) upon
personal delivery to the party notified, (b) when sent by confirmed email or
facsimile if sent during normal business hours of the recipient, if not, then on
the next business day, (c) five (5) days after having been sent by registered or
certified mail, return receipt requested, postage prepaid, or (d) one day after
deposit with a nationally recognized overnight courier, specifying next day
delivery, with written verification of receipt. All communications shall be sent
to the parties at their respective address, email or facsimile number set forth
on the signature page hereto, or to such other address as such party shall have
furnished in writing in accordance with the provisions of this Section 8.

 

9. Assignability. This Agreement and the rights, interests and obligations
hereunder are not transferable or assignable by the Purchaser and the transfer
or assignment of any Membership Interests acquired by the Purchaser shall be
made only in accordance with all applicable laws and the terms of the Company’s
Operating Agreement, as applicable. Any purported transfer in violation of this
Agreement or the Operating Agreement, as applicable, shall be null and void ab
initio.

 

10. Applicable Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York applicable to contracts to be
wholly- performed within said State.

 

11. Dispute Resolution. The parties (a) hereby irrevocably and unconditionally
submit to the jurisdiction of the state courts of New York located in New York
county and to the jurisdiction of the United States District Court for the
Southern District of New York for the purpose of any suit, action or other
proceeding arising out of or based upon this Agreement, (b) agree not to
commence any suit, action or other proceeding arising out of or based upon this
Agreement except in such courts, and (c) hereby waive, and agree not to assert,
by way of motion, as a defense, or otherwise, in any such suit, action or
proceeding, any claim that it is not subject personally to the jurisdiction of
the above-named courts, that its property is exempt or immune from attachment or
execution, that the suit, action or proceeding is brought in an inconvenient
forum, that the venue of the suit, action or proceeding is improper or that this
Agreement or the subject matter hereof may not be enforced in or by such court.

 

WAIVER OF JURY TRIAL: EACH PARTY HEREBY WAIVES ITS RIGHTS TO A JURY TRIAL OF ANY
CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT, THE
MEMBERSHIP INTERESTS OR THE SUBJECT MATTER HEREOF OR THEREOF. THE SCOPE OF THIS
WAIVER IS INTENDED TO BE ALL-ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE
FILED IN ANY COURT AND THAT RELATE TO THE SUBJECT MATTER OF THIS TRANSACTION,
INCLUDING, WITHOUT LIMITATION, CONTRACT CLAIMS, TORT CLAIMS (INCLUDING
NEGLIGENCE), BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW AND STATUTORY
CLAIMS.

 

12. Blue Sky Qualification. The purchase of the Membership Interests under this
Agreement is expressly conditioned upon the exemption from qualification of the
offer and sale thereof, as applicable, from applicable federal and state
securities laws. The Company shall not be required to qualify the Offering or
any issuance of the Membership Interests under the securities laws of any
jurisdiction.

 

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13. Use of Pronouns. All pronouns and any variations thereof used herein shall
be deemed to refer to the masculine, feminine, neuter, singular or plural as the
identity of the person or persons referred to may require.

 

14. Miscellaneous.

 

(a) This Agreement, including all attachments, schedules and exhibits thereto,
constitutes the entire agreement between the Purchaser and the Company with
respect to the subject matter hereof and supersede all prior oral or written
agreements and understandings, if any, relating to the subject matter hereof.

 

(b) The representations and warranties of the Purchaser made in this Agreement
shall survive the execution and delivery hereof and delivery of the Membership
Interests.

 

(c) Each of the parties hereto shall pay its own fees and expenses (including
the fees of any attorneys, accountants, appraisers or others engaged by such
party) in connection with this Agreement and the transactions contemplated
hereby whether or not the transactions contemplated hereby are consummated.

 

(d) This Agreement may be executed in one or more counterparts (including
electronic counterparts), each of which shall be deemed an original, but all of
which shall together constitute one and the same instrument. This Agreement will
be binding on the parties hereto and their successors, permitted assigns and
legal representatives.

 

(e) Each provision of this Agreement shall be considered separable and, if for
any reason any provision or provisions hereof are determined to be invalid or
contrary to applicable law, such invalidity or illegality shall not impair the
operation of or affect the remaining portions of this Agreement.

 

(f) Paragraph and Section titles are for convenience and descriptive purposes
only and are not to be considered in construing or interpreting this Agreement.

 

[SIGNATURE PAGE FOLLOWS]

 

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In Witness Whereof, the parties hereto have executed this Agreement as of the
last date set forth in the spaces provided below on which a party executed this
Agreement.

 

PURCHASER:       HOTH THERAPEUTICS, INC.         By: /s/ Robb Knie   Name: Robb
Knie   Title: Chief Executive Officer         Date: May 28, 2020  

 

Address: 1 Rockefeller Plaza, Suite 1039, New York, NY 10020

 

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In Witness Whereof, the parties hereto have executed this Agreement as of the
last date set forth in the spaces provided below on which a party executed this
Agreement.

 

COMPANY:

 

HALOVAX, LLC         By: /s/ Matthew Duffy   Name: Matthew Duffy   Title:
President         Date: May 28, 2020  

 

 

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