Exhibit 10.131

 

EXCHANGE AGREEMENT

 

EXCHANGE AGREEMENT (the “Agreement”) is made as of the 15th day of March 2017,
by and between Rennova Health, Inc., a Delaware corporation (the “Company”), and
the investor signatory hereto (the “Investor”).

 

WHEREAS, on December 19, 2016, the Company issued registered shares of Series H
Convertible Preferred Stock (“Series H Preferred Stock”), par value $0.01 per
share;

 

WHEREAS, on the date hereof, the Investor owns 2,000 shares of Series H
Preferred Stock, with an aggregate stated value of $2,000,000 (the “Held Series
H Preferred Stock”);

 

WHEREAS, on February 2, 2017, the Company issued to the Investor an unregistered
Original Issue Discount Convertible Debenture with a principal amount equal to
$1,590,000 (the “Bridge Debenture” and together with the Held Series H Preferred
Stock, the “Existing Securities” or “Securities”);

 

WHEREAS, subject to the terms and conditions set forth in this Agreement and
pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended (the
“Securities Act”), and in reliance on Section 3(a)(9) of the Securities Act, the
Company desires to exchange with the Investor, and the Investor desires to
exchange with the Company, the Existing Securities for Senior Secured Original
Issue Discount Convertible Debentures (“Debenture”) and Common Stock Purchase
Warrants (“Warrant”, and together with the Debenture, the "Exchange
Securities"); and

 

WHEREAS, the Company and the Investor acknowledge that the issuance of certain
shares of Common Stock underlying the Exchange Securities is subject to the
approval of the stockholders of the Company pursuant to the limitations imposed
by the Nasdaq Stock Market,

 

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, and in consideration of the premises and the
mutual agreements, representations and warranties, provisions and covenants
contained herein, the parties hereto, intending to be legally bound hereby,
agree as follows:

 

1.                  Exchange. On the Closing Date (as defined below), subject to
the terms and conditions of this Agreement, the Investor shall, and the Company
shall, pursuant to Section 3(a)(9) of the Securities Act, exchange the Existing
Securities for the Exchange Securities. For each $0.80 of principal amount of
Bridge Debenture or $1 of stated value of Held Series H Preferred Stock
surrendered to the Company, the Company shall issue to the Investor a Debenture
with a principal amount of $1.24, along with three series of Warrants.
Debentures and Warrants will be in the form of the Senior Secured Original Issue
Discount Convertible Debentures and Common Stock Purchase Warrants issued
pursuant to that certain Securities Purchase Agreement, dated as of the date
hereof. The Series A Warrant shall have a term of exercise of 5 years and be
exercisable into a number of shares of Common Stock equal to 100% of the number
of shares underlying the Debenture. The Series B Warrant shall have a term of
exercise of 18 months and be exercisable into a number of shares of Common Stock
equal to 100% of the number of shares underlying the Debenture. The Series C
Warrant shall have a term of exercise of 5 years and be exercisable into a
number of shares of Common Stock equal to 100% of the number of shares
underlying the Debenture; provided that such Series C Warrant shall vest ratably
upon exercise of the Series B Warrant. Subject to the conditions set forth
below, the Exchange shall take place at the offices of Ellenoff Grossman &
Schole LLP, on the third Trading Day (as defined below) after the date hereof,
or at such other time and place as the Company and the Investor mutually agree
(the “Closing” and the “Closing Date”). At the Closing, the following
transactions shall occur (such transactions in this Section 1, the “Exchange”):

 

 

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1.1              On the Closing Date, in exchange for the Existing Securities,
the Company shall deliver the Exchange Securities to the Investor or its
designee in accordance with the Investor’s delivery instructions set forth on
the Investor signature page hereto. Upon receipt of the Exchange Securities in
accordance with this Section 1.1, all of the Investor’s rights under the
Existing Securities shall be extinguished. The Investor shall tender to the
Company the Existing Securities within three Trading Days (as defined below) of
the Closing Date.

 

1.2              On the Closing Date, the Investor shall be deemed for all
corporate purposes to have become the holder of record of the Exchange
Securities, irrespective of the date such Exchange Securities are delivered to
the Investor in accordance herewith. As used herein, “Trading Day” means any day
on which the Common Stock is traded on the NASDAQ Capital Market, or, if the
NASDAQ Capital Market is not the principal trading market for the Common Stock,
then on the principal securities exchange or securities market on which the
Common Stock is then traded.

 

1.3              The Company and the Investor shall execute and/or deliver such
other documents and agreements as are customary and reasonably necessary to
effectuate the Exchange.

 

1.4              The Company shall hold a special meeting of shareholders (which
may also be at the annual meeting of shareholders) at the earliest practical
date, but in no event later than 60 days following the Closing Date (90 days in
the event of a review of the proxy statement), for the purpose of obtaining
Shareholder Approval (as defined below), with the recommendation of the
Company’s Board of Directors that such proposal be approved, and the Company
shall solicit proxies from its shareholders in connection therewith in the same
manner as all other management proposals in such proxy statement and all
management-appointed proxyholders shall vote their proxies in favor of such
proposal. The Company shall use best efforts to obtain Shareholder Approval. If
the Company does not obtain Shareholder Approval at the first meeting, the
Company shall call a meeting every four months thereafter to seek Shareholder
Approval until the earlier of the date on which Shareholder Approval is obtained
or the Debentures are no longer outstanding. “Shareholder Approval” means such
approval as may be required by the applicable rules and regulations of the
Nasdaq Stock Market (or any successor entity) from the shareholders of the
Company with respect to the transactions contemplated by the Transaction
Documents, including the issuance of all of the shares of Common Stock
underlying the Debentures and Warrants issued hereunder in excess of 19.99% of
the issued and outstanding Common Stock on the Closing Date. The Company shall
file the preliminary proxy for Shareholder Approval within 15 days of the
Closing Date.

 

 

 

 

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2.                  Closing Conditions.

 

2.1              Conditions to Investor’s Obligations. The obligation of the
Investor to consummate the Exchange is subject to the fulfillment, to the
Investor’s reasonable satisfaction, prior to or at the Closing, of each of the
following conditions:

 

(a)               Representations and Warranties. The representations and
warranties of the Company contained in this Agreement shall be true and correct
in all material respects on the date hereof and on and as of the Closing Date as
if made on and as of such date.

 

(b)               Issuance of Securities. At the Closing, the Company shall
issue the Exchange Securities on the books and records of the Company as
follows:

 

(i)                 a Debenture with a principal amount equal to 1.24 times such
Investor’s principal amount of Bridge Debentures, registered in the name of such
Investor with monthly amortizations commencing on the earlier of (1) June 1,
2017 and (2) the effective date of the registration statement registering for
resale the shares underlying such Debenture;

 

(ii)              a Debenture with a principal amount equal to 1.24 times such
Investor’s stated value of Series H Preferred Stock, registered in the name of
such Investor with monthly amortizations commencing on March 20, 2017;

 

(iii)            a Series A Warrant registered in the name of such Investor to
purchase up to a number of shares of Common Stock equal to 100% of such
Investor’s aggregate principal amount of Debentures as set forth on the
signature pages hereto divided by $1.66, with an exercise price equal to $1.95
subject to adjustment therein;

 

(iv)             a Series B Warrant registered in the name of such Investor to
purchase up to a number of shares of Common Stock equal to 100% of such
Investor’s aggregate principal amount of Debentures as set forth on the
signature pages hereto divided by $1.66, with an exercise price equal to $1.66,
subject to adjustment therein;

 

(v)               a Series C Warrant registered in the name of such Investor to
purchase up to a number of shares of Common Stock equal to 100% of such
Investor’s aggregate principal amount of Debentures as set forth on the
signature pages hereto divided by $1.66, with an exercise price equal to $1.95,
subject to adjustment therein;

 

(c)               No Actions. No action, proceeding, investigation, regulation
or legislation shall have been instituted, threatened or proposed before any
court, governmental agency or authority or legislative body to enjoin, restrain,
prohibit or obtain substantial damages in respect of, this Agreement or the
consummation of the transactions contemplated by this Agreement.

 

 

 

 

 

 

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(d)               Proceedings and Documents. All proceedings in connection with
the transactions contemplated hereby and all documents and instruments incident
to such transactions shall be satisfactory in substance and form to the
Investor, and the Investor shall have received all such counterpart originals or
certified or other copies of such documents as they may reasonably request.

 

(e)               Registration Rights Agreement. The Company and the Investor
shall have entered into a registration rights agreement in form and substance
satisfactory to the Investor.

 

(f)                Listing of Exchange Securities. The Company shall have
secured the listing or designation for quotation (as applicable) of all of the
shares of Common Stock underlying the Debentures, upon each national securities
exchange and automated quotation system, if any, upon which the shares
underlying the Debentures are then listed or designated for quotation (as
applicable).

 

(g)               Security Agreement, Subsidiary Guarantee and UCC Filings. The
Company and the Investor shall have entered into a Security Agreement, duly
executed by the Company and each Subsidiary, along with subsidiary guarantees
from each subsidiary of the Company, a pledge along with pledge securities from
each subsidiary and all UCC-1 filings, all in form and substance satisfactory to
the Investor.

 

(h)               Voting Agreements. The Company shall have provided voting
agreements of all officers and directors of the Company to vote in favor of the
Shareholder Approval.

 

(i)                 Opinion. An opinion of Company counsel in form and substance
reasonably satisfactory to the Investor.

 

(j)                 Subordination Agreement. The Company shall have delivered
duly executed subordination agreements from the subordinated creditors of the
Company, dated on or about the date hereof, in form and substance acceptable to
the Investor.

 

2.2              Conditions to the Company’s Obligations. The obligation of the
Company to consummate the Exchange is subject to the fulfillment, to the
Company’s reasonable satisfaction, prior to or at the Closing, of each of the
following conditions:

 

(a)               Representations and Warranties. The representations and
warranties of the Investor contained in this Agreement shall be true and correct
in all material respects on the date hereof and on and as of the Closing Date as
if made on and as of such date.

 

(b)               No Actions. No action, proceeding, investigation, regulation
or legislation shall have been instituted, threatened or proposed before any
court, governmental agency or authority or legislative body to enjoin, restrain,
prohibit, or obtain substantial damages in respect of, this Agreement or the
consummation of the transactions contemplated by this Agreement.

 

 

 

 

 

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(c)               Proceedings and Documents. All proceedings in connection with
the transactions contemplated hereby and all documents and instruments incident
to such transactions shall be satisfactory in substance and form to the Company
and the Company shall have received all such counterpart originals or certified
or other copies of such documents as the Company may reasonably request.

 

3.                  Representations and Warranties of the Company. The Company
hereby represents and warrants to Investor that:

 

3.1              Organization, Good Standing and Qualification. The Company is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Delaware. The Company is duly qualified to transact business and
is in good standing in each jurisdiction in which the failure to so qualify
would have a material adverse effect on its business or properties.

 

3.2              Authorization. Other than the Shareholder Approval, all
corporate action on the part of the Company, its officers, directors and
stockholders necessary for the authorization, execution and delivery of this
Agreement and the performance of all obligations of the Company hereunder, and
the authorization (or reservation for issuance of), the Exchange, and the
issuance of the Exchange Securities and the shares of Common Stock issuable upon
conversion or exercise of the Exchange Securities have been taken on or prior to
the date hereof.

 

3.3              Valid Issuance of the Securities. The Debentures, Warrants and
shares of Common Stock issuable upon conversion or exercise thereof, as
applicable, when issued and delivered in accordance with the terms of this
Agreement, for the consideration expressed herein, will be duly and validly
issued, fully paid and nonassessable. Subject to the truth and accuracy of the
Investor’s representations set forth in Section 5 of this Agreement, the
Exchange Securities issued in exchange for the Series H Preferred Stock and the
shares of Common Stock issuable thereunder (assuming cashless exercise of the
applicable Warrants) are freely tradeable without the need for registration
under the Securities Act and shall not be required to bear any Securities Act
legend.

 

3.4              Offering. Subject to the truth and accuracy of the Investor’s
representations set forth in Section 5 of this Agreement, the offer and issuance
of the Securities as contemplated by this Agreement are exempt from the
registration requirements of the Securities Act. Neither the Company nor any
authorized agent acting on its behalf will take any action hereafter that would
cause the loss of such exemptions.

 

3.5              Compliance With Laws. The Company has not violated any law or
any governmental regulation or requirement which violation has had or would
reasonably be expected to have a material adverse effect on its business, and
the Company has not received written notice of any such violation.

 

3.6              Consents; Waivers. Other than the Shareholder Approval, no
consent, waiver, approval or authority of any nature, or other formal action, by
any Person, not already obtained, is required in connection with the execution
and delivery of this Agreement by the Company or the consummation by the Company
of the transactions provided for herein and therein.

 

 

 

 

 

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3.7              Acknowledgment Regarding Investor’s Purchase of Securities. The
Company acknowledges and agrees that the Investor is acting solely in the
capacity of arm’s length Investor with respect to this Agreement and the other
documents entered into in connection herewith (collectively, the “Transaction
Documents”) and the transactions contemplated hereby and thereby and that the
Investor is not (i) an officer or director of the Company, (ii) an “affiliate”
of the Company (as defined in Rule 144 promulgated under the Securities Act), or
(iii) to the knowledge of the Company, a “beneficial owner” of more than 10% of
the shares of Common Stock (as defined for purposes of Rule 13d-3 of the
Securities Exchange Act of 1934, as amended). The Company further acknowledges
that the Investor is not acting as a financial advisor or fiduciary of the
Company (or in any similar capacity) with respect to the Transaction Documents
and the transactions contemplated hereby and thereby, and any advice given by
the Investor or any of its representatives or agents in connection with the
Transaction Documents and the transactions contemplated hereby and thereby is
merely incidental to the Investor’s acceptance of the Exchange Securities. The
Company further represents to the Investor that the Company’s decision to enter
into the Transaction Documents has been based solely on the independent
evaluation by the Company and its representatives.

 

3.8              Absence of Litigation. There is no action, suit, proceeding,
inquiry or investigation before or by any court, public board, government
agency, selfregulatory organization or body pending or, to the knowledge of the
Company, threatened against or affecting the Company, the Securities or any of
the Company’s officers or directors in their capacities as such.

 

3.9              No Group. The Company acknowledges that, to the Company’s
knowledge, the Investor is acting independently in connection with this
Agreement and the transactions contemplated hereby, and is not acting as part of
a “group” as such term is defined under Section 13(d) of the Securities Act and
the rules and regulations promulgated thereunder.

 

3.10          Validity; Enforcement; No Conflicts. This Agreement and each
Transaction Document to which the Company is a party have been duly and validly
authorized, executed and delivered on behalf of the Company and shall constitute
the legal, valid and binding obligations of the Company enforceable against the
Company in accordance with their respective terms, except as such enforceability
may be limited by general principles of equity or to applicable bankruptcy,
insolvency, reorganization, moratorium, liquidation and other similar laws
relating to, or affecting generally, the enforcement of applicable creditors’
rights and remedies. The execution, delivery and performance by the Company of
this Agreement and each Transaction Document to which the Company is a party and
the consummation by the Company of the transactions contemplated hereby and
thereby will not (i) result in a violation of the organizational documents of
the Company 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 Company is a party or by
which it is bound, or (iii) result in a violation of any law, rule, regulation,
order, judgment or decree (including federal and state securities or “blue sky”
laws) applicable to the Company, except in the case of clause (ii) above, for
such conflicts, defaults or rights which would not, individually or in the
aggregate, reasonably be expected to have a material adverse effect on the
ability of the Company to perform its obligations hereunder.

 

 

 

 

 

 

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3.11          Disclosure. The Company confirms that neither it nor any other
Person acting on its behalf has provided the Investor or its agents or counsel
with any information that constitutes or could reasonably be expected to
constitute material, nonpublic information. The Company understands and confirms
that the Investor will rely on the foregoing representations in effecting
transactions in the Exchange Securities.

 

3.12          Bring-Down of Representations and Warranties. All representations
and warranties made by the Company to the Holder in any prior agreements
pursuant to which the Exchange Securities were originally issued are accurate
and complete in all material respects as of the date hereof, unless as of a
specific date therein in which case they shall be accurate as of such date (or,
to the extent representations or warranties are qualified by materiality or
Material Adverse Effect (as defined in such agreements), in all respects).

 

4.                  Representations and Warranties of the Investor. The Investor
hereby represents, warrants and covenants that:

 

4.1              Authorization. The Investor has full power and authority to
enter into this Agreement, to perform its obligations hereunder and to
consummate the transactions contemplated hereby and has taken all action
necessary to authorize the execution and delivery of this Agreement, the
performance of its obligations hereunder and the consummation of the
transactions contemplated hereby.

 

4.2              Accredited Investor Status; Investment Experience. The Investor
is an “accredited investor” as that term is defined in Rule 501(a) of Regulation
D. The Investor can bear the economic risk of its investment in the Securities,
and has such knowledge and experience in financial and business matters that it
is capable of evaluating the merits and risks of an investment in the
Securities.

 

4.3              Reliance on Exemptions. The Investor understands that the
Securities are being offered and issued to it in reliance on specific exemptions
from the registration requirements of United States federal and state securities
laws and that the Company is relying in part upon the truth and accuracy of, and
the Investor’s compliance with, the representations, warranties, agreements,
acknowledgments and understandings of the Investor set forth herein in order to
determine the availability of such exemptions and the eligibility of the
Investor to acquire the Securities.

 

4.4              Information. The Investor and its advisors, if any, have been
furnished with all materials relating to the business, finances and operations
of the Company and materials relating to the offer and issuance of the
Securities which have been requested by the Investor. The Investor has had the
opportunity to review the Company's filings with the Securities and Exchange
Commission. The Investor and its advisors, if any, have been afforded the
opportunity to ask questions of the Company. Neither such inquiries nor any
other due diligence investigations conducted by the Investor or its advisors, if
any, or its representatives shall modify, amend or affect the Investor’s right
to rely on the Company’s representations and warranties contained herein. The
Investor understands that its investment in the Securities involves a high
degree of risk. The Investor has sought such accounting, legal and tax advice as
it has considered necessary to make an informed investment decision with respect
to its acquisition of the Securities. The Investor is relying solely on its own
accounting, legal and tax advisors, and not on any statements of the Company or
any of its agents or representatives, for such accounting, legal and tax advice
with respect to its acquisition of the Securities and the transactions
contemplated by this Agreement.

 

 

 

 

 

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4.5              No Governmental Review. The Investor understands that no United
States federal or state agency or any other government or governmental agency
has passed on or made any recommendation or endorsement of the Securities or the
fairness or suitability of the investment in the Securities nor have such
authorities passed upon or endorsed the merits of the offering of the
Securities.

 

4.6              Validity; Enforcement; No Conflicts. This Agreement and each
Transaction Document to which the Investor is a party have been duly and validly
authorized, executed and delivered on behalf of the Investor and shall
constitute the legal, valid and binding obligations of the Investor enforceable
against the Investor in accordance with their respective terms, except as such
enforceability may be limited by general principles of equity or to applicable
bankruptcy, insolvency, reorganization, moratorium, liquidation and other
similar laws relating to, or affecting generally, the enforcement of applicable
creditors’ rights and remedies. The execution, delivery and performance by the
Investor of this Agreement and each Transaction Document to which the Investor
is a party and the consummation by the Investor of the transactions contemplated
hereby and thereby will not (i) result in a violation of the organizational
documents of the Investor 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 Investor is
a party, or (iii) result in a violation of any law, rule, regulation, order,
judgment or decree (including federal and state securities or “blue sky” laws)
applicable to the Investor, except in the case of clause (ii) above, for such
conflicts, defaults or rights which would not, individually or in the aggregate,
reasonably be expected to have a material adverse effect on the ability of the
Investor to perform its obligations hereunder.

 

4.7              Ownership of Bridge Debentures and Series H Preferred Stock.
The Investor owns and holds, beneficially and of record, the entire right,
title, and interest in and to the Bridge Debentures and Series H Preferred Stock
set forth on the signature page hereto free and clear of all rights and Liens
(as defined below). The Investor has full power and authority to transfer and
dispose of the Bridge Debentures and Series H Preferred Stock to the Company
free and clear of any right or Lien. Other than the transactions contemplated by
this Agreement, there is no outstanding vote, plan, pending proposal, or other
right, of any Person to acquire all or any part of the Bridge Debentures, the
Series H Preferred Stock or any shares of Common Stock issuable upon exercise of
the Bridge Debentures or conversion of the Series H Preferred Stock. As used
herein, “Liens” shall mean any security or other property interest or right,
claim, lien, pledge, option, charge, security interest, contingent or
conditional sale, or other title claim or retention agreement, interest or other
right or claim of third parties, whether perfected or not perfected, voluntarily
incurred or arising by operation of law, and including any agreement (other than
this Agreement) to grant or submit to any of the foregoing in the future.

 

 

 

 

 

 

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4.8              No Consideration Paid. No commission or other remuneration has
been paid by the Investor (or any of its agents or affiliates) to the Company
related to the Exchange.

 

5.                  Additional Covenants.

 

5.1              Disclosure. The Company shall, on or before 9:30 a.m., New York
City time, on the first business day after the date of this Agreement, issue a
Current Report on Form 8-K (collectively, the “8-K Filing”) disclosing all
material terms of the transactions contemplated hereby. From and after the
issuance of the 8-K Filing, the Investor shall not be in possession of any
material, nonpublic information received from the Company or any of its
respective officers, directors, employees or agents, that is not disclosed in
the 8-K Filing. The Company shall not, and shall cause its officers, directors,
employees and agents, not to, provide the Investor with any material, nonpublic
information regarding the Company from and after the filing of the 8-K Filing
without the express written consent of the Investor. The Company shall not
disclose the name of the Investor in any filing, announcement, release or
otherwise, unless such disclosure is required by law or regulation. In addition,
effective upon the filing of the 8-K Filing, the Company acknowledges and agrees
that any and all confidentiality or similar obligations under any agreement,
whether written or oral, between the Company, any of its subsidiaries or any of
their respective officers, directors, affiliates, employees or agents, on the
one hand, and the Investor or any of its affiliates, on the other hand, shall
terminate.

 

5.2              Listing. The Company shall use its best efforts to maintain the
listing or designation for quotation (as applicable) of all of the shares of
Common Stock underlying the Debentures and Warrants upon each national
securities exchange and automated quotation system on which the Common Stock is
currently listed or designated while such securities are outstanding. The
Company shall pay all fees and expenses in connection with satisfying its
obligations under this Section 6.2.

 

5.3              Registered Characteristics. Subject to the truth and accuracy
of the Investor’s representations set forth in Section 4 of this Agreement, the
parties acknowledge and agree that in accordance with Section 3(a)(9) of the
Securities Act, the Exchange Securities (assuming cashless exercise of the
Warrants) issued in Exchange for the Series H Preferred Stock take on the
registered characteristics of the Series H Preferred Stock and the Company
agrees not to take a position to the contrary. Upon conversion of such
Debentures and exercise of such Warrants (assuming cashless exercise) the shares
issuable thereunder shall be freely tradeable and free of any restrictions on
resale or Securities Act legends.

 

5.4              Tacking. Subject to the truth and accuracy of the Investor’s
representations set forth in Section 4 of this Agreement, the parties
acknowledge and agree that in accordance with Section 3(a)(9) of the Securities
Act, the Exchange Securities (assuming cashless exercise of the Warrants) issued
in Exchange for the Bridge Debentures will tack back to the original issue date
of such Bridge Debentures pursuant to Rule 144 and the Company agrees not to
take a position to the contrary.

 

 

 

 

 

 

 

 

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5.5              Survival of Covenants. Sections 4.1, 4.3, 4.5, 4.6, 4.8, 4.10,
4.11, 4.12 (subject to the limitations set forth in that certain Securities
Purchase Agreement dated as of the date hereof with the Company, the Investor
and certain other investors signatory thereto), 4.13(b) and 4.15 of that certain
Securities Purchase Agreement dated as of January 29, 2017 shall survive and be
incorporated by reference into this Agreement and Debentures, Warrants and the
shares underlying the Debentures and Warrants issuable hereunder shall for all
such purposes be deemed “Debentures”, “Warrants”, “Securities”, “Conversion
Shares”, “Warrant Shares” and “Underlying Shares” as applicable and as used
under such Securities Purchase Agreement as if the Debentures and Warrants were
issued pursuant to such agreement.

 

5.6              Blue Sky. The Company shall make all filings and reports
relating to the Exchange required under applicable securities or “Blue Sky” laws
of the states of the United States following the date hereof, if any.

 

5.7              Fees and Expenses. Each party shall pay the fees and expenses
of its advisers, counsel, accountants and other experts, if any, and all other
expenses incurred by such party incident to the negotiation, preparation,
execution, delivery and performance of this Agreement.

 

6.                  Miscellaneous.

 

6.1              Successors and Assigns. Except as otherwise provided herein,
the terms and conditions of this Agreement shall inure to the benefit of and be
binding upon the parties hereto and the respective successors and assigns of the
parties. Nothing in this Agreement, express or implied, is intended to confer
upon any party, other than the parties hereto or their respective successors and
assigns, any rights, remedies, obligations or liabilities under or by reason of
this Agreement, except as expressly provided in this Agreement.

 

6.2              Governing Law; Jurisdiction; Jury Trial. All questions
concerning the construction, validity, enforcement and interpretation of this
Agreement shall be governed by the internal laws of the State of New York,
without giving effect to any choice of law or conflict of law provision or rule
(whether of the State of New York or any other jurisdictions) that would cause
the application of the laws of any jurisdictions other than the State of New
York. Each party hereby irrevocably submits to the exclusive jurisdiction of the
state or federal courts sitting in The City of New York, Borough of Manhattan,
for the adjudication of any dispute hereunder or in connection herewith or with
any transaction contemplated hereby or discussed herein, and hereby irrevocably
waives, and agrees not to assert in any suit, action or proceeding, any claim
that it is not personally subject to the jurisdiction of any such court, that
such suit, action or proceeding is brought in an inconvenient forum or that the
venue of such suit, action or proceeding is improper. Each party hereby
irrevocably waives personal service of process and consents to process being
served in any such suit, action or proceeding by mailing a copy thereof to such
party at the address for such notices to it under this Agreement and agrees that
such service shall constitute good and sufficient service of process and notice
thereof. Nothing contained herein shall be deemed to limit in any way any right
to serve process in any manner permitted by law. EACH PARTY HEREBY IRREVOCABLY
WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE
ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF
THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.

 

 

 

 

 

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6.3              Titles and Subtitles. The titles and subtitles used in this
Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.

 

6.4              Notices. Any notices, consents, waivers or other communications
required or permitted to be given under the terms of this Agreement must be in
writing and will be deemed to have been delivered: (i) upon receipt, when
delivered personally; (ii) upon receipt, when sent by facsimile (provided
confirmation of transmission is mechanically or electronically generated and
kept on file by the sending party) or by electronic mail; or (iii) one Business
Day after deposit with an overnight courier service, in each case properly
addressed to the party to receive the same. The addresses, facsimile numbers and
email addresses for such communications shall be:

 

If to the Company:

 

Rennova Health, Inc.

400 South Australian Avenue, 8th Floor

West Palm Beach, Florida 33401

Attention: Chief Executive Officer

Telephone: (561) 855-1626

Facsimile: (561) 282-3417

E-mail: slagan@rennovahealth.com

 

With a copy to:

 

Shutts & Bowen LLP

200 South Biscayne Boulevard, Suite 4100

Miami, FL 33131

Telephone: (305) 379-9141

Facsimile: (305) 347-7767

Email: TCookson@shutts.com

 

If to the Investor, to its address, facsimile number and email address set forth
on its signature page hereto,

 

or to such other address, facsimile number and/or email address and/or to the
attention of such other Person as the recipient party has specified by written
notice given to each other party five (5) days prior to the effectiveness of
such change. Written confirmation of receipt (A) given by the recipient of such
notice, consent, waiver or other communication, (B) mechanically or
electronically generated by the sender’s facsimile machine or email containing
the time, date, recipient facsimile number and an image of the first page of
such transmission or (C) provided by an overnight courier service shall be
rebuttable evidence of personal service, receipt by facsimile or receipt from an
overnight courier service in accordance with clause (i), (ii) or (iii) above,
respectively.

 

 

 

 

 11 

 

 

6.5              Finder’s Fees. Each party represents that it neither is nor
will be obligated for any finders’ fee or commission in connection with this
transaction. The Investor shall indemnify and hold harmless the Company from any
liability for any commission or compensation in the nature of a finders’ fee
(and the costs and expenses of defending against such liability or asserted
liability) for which the Investor or any of its officers, partners, employees or
representatives is responsible. The Company shall indemnify and hold harmless
the Investor from any liability for any commission or compensation in the nature
of a finders’ fee (and the costs and expenses of defending against such
liability or asserted liability) for which the Company or any of its officers,
employees or representatives is responsible.

 

6.6              Amendments and Waivers. Any term of this Agreement may be
amended and the observance of any term of this Agreement may be waived (either
generally or in a particular instance and either retroactively or
prospectively), only with the written consent of the Company and the Investor.
Any amendment or waiver effected in accordance with this paragraph shall be
binding upon Investor and the Company, provided that no such amendment shall be
binding on a holder that does not consent thereto to the extent such amendment
treats such party differently than any party that does consent thereto.

 

6.7              Severability. If one or more provisions of this Agreement are
held to be unenforceable under applicable law, such provision shall be excluded
from this Agreement and the balance of the Agreement shall be interpreted as if
such provision were so excluded and shall be enforceable in accordance with its
terms.

 

6.8              Entire Agreement. This Agreement represents the entire
agreement and understanding between the parties concerning the Exchange and the
other matters described herein and therein and supersedes and replaces any and
all prior agreements and understandings solely with respect to the subject
matter hereof and thereof.

 

6.9              Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.

 

6.10          Interpretation. Unless the context of this Agreement clearly
requires otherwise, (a) references to the plural include the singular, the
singular the plural, the part the whole, (b) references to any gender include
all genders, (c) “including” has the inclusive meaning frequently identified
with the phrase “but not limited to” and (d) references to “hereunder” or
“herein” relate to this Agreement.

 

6.11          No Third Party Beneficiaries. This Agreement is intended for the
benefit of the parties hereto and their respective permitted successors and
assigns, and is not for the benefit of, nor may any provision hereof be enforced
by, any other Person.

 

6.12          Survival. The representations, warranties and covenants of the
Company and the Holder contained herein shall survive the Closing and delivery
of the Securities.

 

6.13          Further Assurances. Each party shall do and perform, or cause to
be done and performed, all such further acts and things, and shall execute and
deliver all such other agreements, certificates, instruments and documents, as
any other party may reasonably request in order to carry out the intent and
accomplish the purposes of this Agreement and the consummation of the
transactions contemplated hereby.

 

6.14          No Strict Construction. The language used in this Agreement will
be deemed to be the language chosen by the parties to express their mutual
intent, and no rules of strict construction will be applied against any party.

 

[SIGNATURES ON THE FOLLOWING PAGES]

 

 

 

 

 

 

 12 

 

 

IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed
and delivered as of the date provided above.

 

THE   COMPANY

 

RENNOVA HEALTH, INC.

 

By: /s/ Seamus Lagan       
Name: Seamus Lagan          
Title: Chief Executive Officer          

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed
and delivered as of the date provided above.

 

INVESTOR

 

 

Name of Investor: Sabby Healthcare Master Fund, Ltd.
                                       

 

Signature of Authorized Signatory of Investor: /s/ Robert Grundstein     

 

Name of Authorized Signatory: Robert Grundstein     

 

Title of Authorized Signatory: COO of Purchaser’s Investment Manager     

 

Email Address of Authorized Signatory: rgrundstein@sabbycapital.com     

 

Facsimile Number of Authorized Signatory: 201-661-8654          

 

Address for Notice to Investor: c/o Sabby Management, LLC, 10 Mountainview Road,
Suite 205, Upper Saddle River, New Jersey 07548

 

 

 

 

Address for Delivery of Securities to Investor (if not same as address for
notice):

 

 

 

Bridge Debentures Surrendered: $1,987,500     

 

Stated Value of Series H Preferred Stock Surrendered: $2,000,000     

 

First Debenture (1.24 x principal amount of Bridge Debenture): 2,464,500     

 

Second Debenture (1.24 x stated value of Series H): 2,480,000     

 

Series A Warrant Shares: 2,978,614     

 

Series B Warrant Shares: 2,978,614     

 

Series C Warrant Shares: 2,978,614     

 

[SIGNATURE PAGES CONTINUE]

 

 

 

 

 

 

 

 

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