[*] Certain information in this document has been omitted from this exhibit
because it is both (i) not material and (ii) would be competitively harmful if
publicly disclosed.

 

ASSET PURCHASE AGREEMENT

 

This Asset Purchase Agreement (this “Agreement”) is made and entered into this
30th day of August, 2019 (the “Effective Date”), among Verus International,
Inc., a Delaware Corporation (“Buyer”), and [*], a [*] Limited Liability Company
(“Seller”). Buyer and Seller may sometimes be individually referred to as the
“Party” or collectively referred to as the “Parties”. 

 

R E C I T A L S:

 

A. Seller is engaged in the business of distributing frozen foods in the Middle
East (the “Business”).

 

B. Seller desires to sell, and Buyer desires to acquire, all, or substantially
all, of the assets of the Seller’s French Fry business (as more fully defined
below, the “Acquired Assets”) and all of the business conducted by Seller (all
such business is hereinafter sometimes referred to as the “Business”), through
the acquisition (the “Acquisition”) of the Acquired Assets by Buyer, in exchange
for certain consideration as more fully provided herein; provided, however, that
the Acquired Assets shall not include any of the Excluded Assets (as defined in
Section 1.3).

 

C. The Board of Directors of Buyer and Seller have determined the Acquisition in
the manner contemplated herein to be desirable and in the best interests of
their respective shareholders or members, as the case may be, and, by
resolutions or written actions, have duly approved and adopted this Agreement.

 

STATEMENT OF AGREEMENT

 

NOW, THEREFORE, in consideration of the mutual covenants contained herein, and
for other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, each of the Parties hereto, on the basis of, and in
reliance upon, the representations, warranties, covenants, obligations and
agreements set forth herein, and upon the terms and subject to the conditions
contained herein, agrees as follows:

 

Article I

 

RECITALS; PURCHASE AND SALE

 

Section 1.1 Recitals. Each of the Parties hereby agree that the recitals set
forth above are true and correct and are incorporated into the terms of this
Agreement.

 

Section 1.2 Purchase and Sale. On the Closing Date (as defined in Section 1.6)
Seller shall sell, assign, transfer, convey and deliver to Buyer, and Buyer
shall purchase, acquire and accept from Seller, free and clear of any lien,
claim, pledge, security interest or encumbrance of whatever kind or character,
all of the assets, properties, goodwill and rights of Seller relating to the
Business of every nature, kind and description, tangible and intangible,
wheresoever located and whether or not carried or reflected on the books and
records of Seller (the “Acquired Assets”), including, without limitation, the
following (except to the extent any item of the following is part of the
Excluded Assets):

 

(a) All equipment, furniture, supplies, computer hardware and other tangible
personal property of Seller (the “Personal Property”);

 

(b) All work-in-process and other inventory of Seller (the “Inventory”);

 

(c) All franchises, licenses, permits, consents, authorizations, approvals, and
certificates of any regulatory, administrative or other government agency or
body relating to the Business (the “Permits”);

 

(d) All patents, patentable materials, formula, packaging, brand names, trade
secrets, processes, procedures, systems, proprietary rights, proprietary
knowledge, confidential or proprietary information, know-how, show-how,
inventions, computer software, technology, trademarks, names, service marks,
trade names, internet domain names, URL addresses, electronic mail addresses,
copyrights, copyrighted and copyrightable materials (whether or not registered,
published or containing a copyright notice, and including, but not limited to,
any and all moral rights and similar rights, and derivatives), symbols, logos,
customer lists, inventions, franchises and permits and all filings, applications
for registrations, registrations, renewals and reissues of any such
registrations with or by an federal, state, local or foreign regulatory,
administrative, governmental or quasi-governmental office or authority, any of
the foregoing that might be issued upon any such registration, and all licenses,
sublicenses or agreements in respect thereof, that Seller owns or has the right
to use or to which Seller is a party, whether or not used in the Business
(collectively, the “Proprietary Rights”);

 

 

 

 

[*] Certain information in this document has been omitted from this exhibit
because it is both (i) not material and (ii) would be competitively harmful if
publicly disclosed.

 

(e) All claims and rights under contracts, agreements, contract rights, leases,
license agreements, franchise rights and agreements, policies, purchase and
sales orders ( the “Pending Sales Orders”), engagement letters, executory
commitments, instruments, guaranties, indemnifications, arrangements, and
understandings of Seller, whether oral or written, to which Seller is a party
(whether or not legally bound thereby) (the “Contracts”), including, without
limitation, the Pending Sales Orders Contracts and that each of said Pending
Sales Orders is valid, still pending, on time, and is not the subject of any
cancellation and Seller has no knowledge of any potential cancellation or
reduction of any Pending Sales Order.

 

(f) All investments, deposits and prepaid expenses;

 

(g) All causes of action, judgments and claims or demands against others of
whatever kind or description;

 

(h) All books of account, records, customer lists, vendor lists, files, papers,
records, promotional marketing and advertising materials, catalogs, brochures,
forms, plans, manuals and handbooks relating to the conduct of the Business or
otherwise relating to the conduct of the Business or otherwise relating to the
Acquired Assets or usable in connection with the Business;

 

(i) All goodwill (excluding any unamortized goodwill reflected on the financial
statements of Seller); and

 

(j) All of Seller’s telephone numbers, including, without limitation, all local
and toll free telephone numbers.

 

Section 1.3 Excluded Assets. Notwithstanding any other provision of this
Agreement to the contrary, the following items shall be excluded from the
Acquired Assets (the “Excluded Assets”):

 

(a) all corporate minute books, stock records, corporate seals, treasury shares
and tax returns and supporting schedules of Seller (all of which shall be
subject to Buyer’s right to inspect and copy); and

 

(b) all fixed assets including vehicles, machinery and equipment and any and all
liabilities of the Buyer.

 

Section 1.4 Assumption of Liabilities. Buyer shall not and does not assume any
obligations of Seller, with the exception of trade payables that is directly
linked as associated accounts receivables as shown on the balance sheet and
financial statements provided by Seller to Buyer hereunder, as well as any
obligations that Seller has under previous product warranties given pursuant to
the sale of its products to its customers, which shall not be deemed to be
extended or renewed hereby (the “Assumed Liabilities”). With the exception of
the Assumed Liabilities, Buyer shall not by the execution and performance of
this Agreement, or otherwise, assume or otherwise be responsible for any
liability or obligation of any nature of Seller, or claims of such liability or
obligation, matured or unmatured, liquidated or unliquidated, fixed or
contingent, or known or unknown, whether arising out of occurrences prior to, at
or after the Closing Date.

 

Section 1.5 Acquisition Consideration. The consideration to be paid for the
Acquired Assets shall be equivalent to 2,000,000 AED ($544,477 USD) in cash,
plus assumption of the Assumed Liabilities (the ‘Acquisition Consideration”).

 

 

 

 

[*] Certain information in this document has been omitted from this exhibit
because it is both (i) not material and (ii) would be competitively harmful if
publicly disclosed.

 

CONSUMMATION OF ACQUISITION

 

Section 1.6 General. As used in this Agreement, the “Closing” shall mean the
time at which each of the Parties hereto consummate the sale, transfer,
assignment and delivery of the Acquired Assets to Buyer, and the consummation of
the other transactions provided for in Article I hereof; provided that such
consummation shall be effective as of the Closing Date. The Closing shall take
place on or before September 6, 2019, at an agreed location on the date hereof
(the “Closing Date”), or at such other time and place as the Parties shall
mutually agree.

 

Section 1.7 Due Diligence Period. Buyer shall have until 5:00 p.m., on September
5, 2019, to conduct due diligence (the “Due Diligence Period”) to determine
whether in its sole and absolute discretion it will proceed with the transaction
contemplated by this Agreement. If Buyer fails to notify Seller in writing prior
to the expiration of the Due Diligence Period that Buyer has elected not to
proceed with the transaction contemplated by this Agreement, Buyer shall be
deemed to have irrevocably elected to proceed with this transaction. During the
Due Diligence Period, Seller shall (i) provide Buyer and their designees with
such information as or Buyer may from time to time reasonably request with
respect to the Business, the Acquired Assets and the Assumed Liabilities and the
transactions contemplated by this Agreement, (ii) provide Buyer and their
designees, officers, counsel, accountants, actuaries and other authorized
representatives access during regular business hours and upon reasonable notice
to the books, records, offices, personnel, counsel, customers, vendors,
accountants and actuaries of the Business as Buyer or their designees may from
time to time reasonably request and (iii) permit Buyer and its designees to make
such inspections of the foregoing as Buyer may reasonably request. Any
investigation shall be conducted in such a manner so as not to interfere
unreasonably with the operation of the Business. No such investigation (or any
disclosure made at any time by Seller to Buyer) shall limit or modify in any
way, or act or result in a waiver of, any Seller’s obligations with respect to
any breach of its representations, warranties, covenants or agreements contained
herein (including, without limitation, conditions to Closing or indemnification
obligations).

 

Section 1.8 Documents to be Delivered by Seller At the Closing, in addition to
any other documents specifically required to be delivered pursuant to the terms
of this Agreement, Seller shall deliver or cause to be delivered to Buyer, in
form and substance reasonably satisfactory to Buyer:

 

(a) certified copies of duly executed written actions of the shareholders and
Board of Directors of Seller authorizing and approving the execution and
delivery of this Agreement and all other documents and instruments required
hereunder to be executed and delivered by Seller and the consummation by Seller
of all transactions and agreements contemplated herein;

 

(b) a good and sufficient Bill of Sale, satisfactory to Buyer and duly executed
by Seller, conveying, selling, transferring and assigning to Buyer title to all
of the Acquired Assets free and clear of all security interests, liens, charges,
encumbrances or equities whatsoever;

 

(c) a good and sufficient Assignment and Assumption Agreement related to the
Contracts and Pending Sales Orders, in a form satisfactory to Buyer and duly
executed by Seller together with the written consents of all parties necessary
in order to transfer all of Seller’s rights there under to Buyer; and

 

(d) such other documents and instruments as shall reasonably be required by
Buyer to be executed and delivered by Seller in order to fully and effectively
consummate all of the transactions contemplated herein to be performed by
Seller;

 

Section 1.9 Documents to be Delivered by Buyer. At the Closing (or within the
appropriate time periods set forth in Section 1.6 hereof), in addition to any
other documents specifically required to be delivered pursuant to this
Agreement, Buyer, as the case may be, shall deliver to Seller or the Owners, in
form and substance reasonably satisfactory to Seller:

 

(a) the Closing Date Payment;

 

(b) the Assignment and Assumption Agreement duly executed by Buyer;

 

(c) certificate of good standing of Buyer issued by the Secretary of State of
the State of Delaware, or other proof of good standing dated not more than
ninety (90) days prior to the Closing Date, as well as copies of duly executed
written actions of all of the members of the Board of Directors of Buyer
authorizing and approving the execution and delivery of this Agreement and all
other documents and instruments required hereunder to be executed and delivered
by Buyer and the consummation by Buyer of all transactions and agreements
contemplated herein; and

 

(d) such other documents and instruments as shall be reasonably required by
Seller to be executed and delivered by Buyer in order to fully and effectively
consummate all of the transactions contemplated herein to be performed by Buyer.

 

 

 

 

[*] Certain information in this document has been omitted from this exhibit
because it is both (i) not material and (ii) would be competitively harmful if
publicly disclosed.

 

Article II

 

REPRESENTATIONS AND WARRANTIES

OF BUYER

 

In order to induce Seller to enter into this Agreement, Buyer hereby represents
and warrants to Seller that the following statements contained in this Article
III are true, correct and complete, both as of the execution hereof and as of
the Closing Date:

 

Section 2.1 Organization and Standing. Buyer is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware
with full power and authority (corporate and other), to own, lease, use, and
operate its properties and to conduct its business as and where now owned,
leased, used, operated and conducted.

 

Section 2.2 Corporate Power and Authority. Buyer has all requisite corporate
power and authority to enter into this Agreement and the agreements to be
entered into in connection with this Agreement, and all such agreements have
been duly executed and delivered by Buyer and constitute the legal, valid and
binding obligation of Buyer, enforceable against each of Buyer in accordance
with its terms.

 

Section 2.3 Conflicts; Consents and Approvals. Neither the execution nor
delivery of this Agreement by Buyer nor the consummation of the transactions
contemplated by this Agreement will violate or conflict with any agreement to
which Buyer is a party, or will violate the terms of its charter, or its bylaws.

 

Section 2.4 Litigation. There is no suit, claim, action, proceeding or
investigation pending or, to the best knowledge of Buyer, threatened against
Buyer that could have a material adverse effect on the ability of Buyer to
consummate the transactions contemplated by this Agreement.

 

Section 2.5 Brokerage and Finder’s Fees. Buyer has not engaged the services of
any broker or agreed to pay any brokerage or finder’s fees in connection with
the transactions contemplated by this Agreement.

 

Article III

 

REPRESENTATIONS AND WARRANTIES

OF SELLER

 

In order to induce Buyer to enter into this Agreement, Seller represents and
warrants to Buyer, that the following statements contained in this Article III
are true, correct, and complete, both as of the execution hereof, and as of the
Closing Date:

 

Section 3.1 Organization and Standing. Seller is a corporation duly organized,
validly existing and in good standing under the laws of the Dubai, United Arab
Emirates with full power and authority to own, lease, use, and operate its
properties and to conduct its business as and where now owned, leased, used,
operated and conducted. Seller is not qualified to do business as a foreign
corporation in any jurisdiction other than the State of Alabama and neither the
nature of the Business nor other activities conducted by Seller nor the
properties that Seller owns, leases, or operates requires Seller to qualify to
do business as a foreign corporation in any other jurisdiction. Seller has not
received any written notice or assertion within the last three (3) years from
any governmental official in any jurisdiction to the effect that Seller is
required to be qualified or authorized to do business as a foreign corporation
in a jurisdiction other than the State of Alabama. Seller is not in default in
the performance, observation or fulfillment of any provision of its Articles of
Organization (“Seller Articles”), its Memorandum of Association (“Seller
Bylaws”) or any shareholders agreement to which any Owner is bound (“Seller
Shareholders Agreement”).

 

Section 3.2 Power and Authority. Seller has all requisite corporate power and
authority to enter into and perform this Agreement and the agreements to be
entered into in connection with this Agreement to which it is a party (the
“Seller Related Agreements”) and to carry out its obligations under this
Agreement and the Seller Related Agreements. This Agreement and the Seller
Related Agreements and the transactions contemplated by this Agreement and the
Seller Related Agreements have been duly and validly authorized by all necessary
corporate action on the part of Seller and any other necessary parties. This
Agreement and the Seller Related Agreements have been duly executed and
delivered by Seller and constitute the legal, valid and binding obligation of
Seller, enforceable against Seller in accordance with its terms.

 

 

 

 

[*] Certain information in this document has been omitted from this exhibit
because it is both (i) not material and (ii) would be competitively harmful if
publicly disclosed.

 

Section 3.3 Consents and Approvals. Neither the execution and delivery of this
Agreement by Seller nor the consummation of the transactions contemplated by
this Agreement requires or will require any action or consent or approval of, or
review by, or registration with, any third party, court or governmental body or
other agency, instrumentality or authority.

 

Section 3.4 Financial Statements. Seller has furnished to Buyer the statement of
income, expenses, assets and liabilities related to the French Fry business
along with finical models and value chain (collectively, the “Financial
Statements”). The Financial Statements, have been personally delivered to Buyer,
are true and correct in all material respects and fairly present the financial
condition and results of operations of Seller as of the dates stated and the
results of operations of Seller for the periods then ended in accordance with
such practices, except as otherwise stated therein or herein.

 

Section 3.5 Undisclosed Liabilities and Absence of Material Adverse Change.

 

(a) Seller does not have any liability or obligation of any nature (whether
matured or unmatured, liquidated or unliquidated, fixed or contingent, or
otherwise and whether due or to become due) except for those specifically shown
in the Financial Statements. There has been no material adverse change in the
business operations, assets, properties, customer base, prospects, rights or
condition (financial or otherwise) of Seller or any occurrence, circumstance, or
combination thereof that reasonably could be expected to result in any such
material adverse change since the date of the original letter of intent between
the parties dated July 15, 2019, including, without limitation, any material
adverse change relating to Seller’s relationship with any customer, contractor,
insurance carrier or other vendor. Additionally, since said date, up to and
including the Closing date, Seller represents that there has been no additional
indebtedness or contractual liability taken on by Seller, or promises made to
any third party which would have the effect of limiting or reducing the value of
the Acquired Assets or the Business.

 

Section 3.6 Taxes.

 

(a) Seller has duly and timely filed all federal, state, local and foreign tax
returns and tax reports (collectively, “Tax Returns”) required to be filed by it
under applicable laws and regulations. All such Tax Returns are true, correct
and complete in all respects and were prepared in compliance with all applicable
laws and regulations. All amounts due and owing by Seller (whether or not shown
on any Tax Return) have been fully paid. Seller is not currently the beneficiary
of any extension of time within which to file any Tax Return. No claim has ever
been made by an authority in any jurisdiction where Seller does not file Tax
Returns that Seller is or may be subject to taxation by that jurisdiction. There
are no liens or other security interests for taxes (other than taxes not yet due
and payable) upon any of the Acquired Assets.

 

(b) Seller has withheld and paid all amounts required to have been withheld and
paid in connection with any amounts paid or owing to any employee, independent
contractor, creditor, stockholder, or other third party.

 

(c) Seller has not waived any statute of limitations in respect of taxes or
agreed to any extension of time with respect to a tax assessment or deficiency.

 

(d) Seller has never been a member of any affiliated, consolidated, combined or
unitary group for purposes of taxes and Seller has no liability under Treasury
Regulation 1.1502-6. There exists no tax-sharing agreement or arrangement
pursuant to which Seller is obligated to pay the tax liability of any other
Person (as defined below), or to indemnify any other Person with respect to any
tax. For purposes of this Agreement, “Person” means an individual, a
partnership, a corporation, a limited liability company, an association, a joint
stock company, a trust, a joint venture, an unincorporated organization, any
other business entity, or governmental entity (or any department, agency, or
political subdivision thereof).

 

Section 3.7 Compliance with Law. Seller has complied and is in compliance with
all material laws, statutes, ordinances, orders, rules, regulations, policies,
and guidelines promulgated, and all judgments, decisions and orders entered, by
any federal, state, local or foreign court or governmental authority or
instrumentality or private entity or organization authorized by any of the
foregoing to act on its behalf that are applicable or relate to Seller, the
Business, or the Acquired Assets. Seller is not in violation of any of the
Permits, and there is no pending nor, to the best knowledge of Seller, any
threatened proceeding that could result in the revocation, cancellation or
inability of Seller to renew any Permit. Seller has not been charged with or
given notice of any violation of any of the applicable laws which violation has
not been remedied in full (without any remaining liability of Seller).

 

 

 

 

[*] Certain information in this document has been omitted from this exhibit
because it is both (i) not material and (ii) would be competitively harmful if
publicly disclosed.

 

Section 3.8 Proprietary Rights.

 

(a) At the time of closing, Seller shall provide Buyer all Proprietary Rights
that were used in the operation of the Business, including without limitation,
patents, trade secrets, processes, proprietary rights, proprietary knowledge,
know-how, technology, trademarks, names, service marks, trade names, internet
domain names, URL addresses, electronic mail addresses, copyrights, symbols,
logos, customer lists, inventions, franchises and permits, license, sublicense,
or other such right that is necessary for the operation of the Business in
substantially the same manner as the Business is presently conducted. To the
best knowledge of Seller, the Business has not been and is not being conducted
in contravention of any trademark, copyright or other proprietary right of any
Person.

 

(b) Seller has exclusive rights to own and use the computer software owned or
licensed by Seller (the “Software”) and has the right to transfer all Software
used by Seller pursuant to this Agreement.

 

Section 3.9 Restrictive Documents or Laws. Seller is not a party to or bound
under any mortgage, lien, lease, agreement, contract, instrument, law, order,
judgment or decree, or any similar restriction not of general application that
adversely affects, or reasonably could be expected to so affect (a) the Acquired
Assets or the ability of Buyer to utilize them in the Business after the Closing
Date on substantially the same basis as the Business is currently operated; or
(b) the consummation of the transactions contemplated by this Agreement.

 

Section 3.10 Intentionally Omitted.

 

Section 3.11 Title to and Condition of Acquired Assets. Seller has good, valid
and marketable title to all of the Acquired Assets, and the Acquired Assets
constitute all of the property now used in and necessary for the conduct of the
business of Seller as presently conducted. All of the Acquired Assets are held
free and clear of all mortgages, pledges, liens, security interests,
encumbrances and restrictions of any nature whatsoever. No financing statement
under the Uniform Commercial Code or similar law naming Seller as debtor has
been filed in any jurisdiction, and Seller is not a party to or, to the best
knowledge of Seller, bound under any agreement or legal obligation authorizing
any party to file any such financing statement.

 

Section 3.12 Brokers and Finders Fees. If Seller has engaged any brokers related
to this transaction, it shall be responsible for any and all payments, including
any brokerage or finder’s fee, due to any broker as a result of this
transaction.

 

Section 3.13 Legal Proceedings, etc. There are no (and over the last five (5)
years there have been no) claims, proceedings, suits, or investigations
(collectively, “actions”) pending or, to the best knowledge of Seller,
threatened against or relating to Seller (or any of its shareholders or
employees in connection with the business or affairs of Seller), before any
federal, state, local or foreign court or governmental body. There are no
actions pending or, to the best knowledge of Seller, threatened for the purpose
of enjoining or preventing this Agreement of any other transaction contemplated
by this Agreement or otherwise challenging the validity or propriety of the
transactions contemplated by this Agreement.

 

Section 3.14 Intentionally Omitted.

 

Section 3.15 Contracts. Seller has furnished to Buyer all contracts, agreements,
leases, arrangements and understandings (written or oral) to which Seller is a
party. Seller represents that it is not in breach of any such contracts or
agreements.

 

Section 3.16 Inventory. Seller has furnished to Buyer a complete and accurate
list of all Inventory owned or held by the Seller or used in the conduct of the
Business, including, without limitation, manufacturing supplies, raw materials,
components, repair parts, work-in-progress, finished goods and similar items,
whether raw or used. The quantities of Inventory as of the Closing Date will be
reasonable under the current circumstances of the Business. None of the
Inventory is in the possession of others. The Inventory is not subject to any
claim with respect to the use of materials held on consignment. All products
manufactured (whether or not completed) or sold before the Closing Date will be
in compliance with all warranties with respect to that product.

 

 

 

 

[*] Certain information in this document has been omitted from this exhibit
because it is both (i) not material and (ii) would be competitively harmful if
publicly disclosed.

 

Section 3.17 No Conflict or Default. Neither the execution and delivery of this
Agreement by Seller, including, without limitation, the consummation of the
transactions contemplated by this Agreement, will violate any applicable laws or
Permits or conflict with or result in the breach of any term, condition or
provision of the Seller’s Articles, Seller’s Bylaws or any agreement between
Seller’s shareholders or other organizational document of Seller, or of any
material agreement, deed, contract, undertaking, mortgage, indenture, writ,
order, decree, restriction, legal obligation or instrument to which Seller is a
party.

 

Section 3.18 Books of Account; Records. Seller’s general ledgers, and other
records relating to the assets, properties, contracts and outstanding legal
obligations of Seller are complete and correct and have been maintained in
accordance with good business practices, and, to the extent required by GAAP
(except for the requirement to include the footnotes and other off book
disclosures required by GAAP), the matters contained therein are appropriate and
accurately reflected in the Financial Statements.

 

Section 3.19 Shareholders, Officers and Directors. [*] is a shareholder, officer
and director of Seller, and has full power and authority to execute all
documents related to this transaction on behalf of Seller.

 

Section 3.20 Labor Relations. Seller has complied in all material respects with
all applicable federal, state and local laws, rules, regulations and executive
orders relating to employment, and all applicable laws, rules and regulations
governing payment of minimum wages and overtime rates, and the withholding and
payment of taxes from compensation of employees and the payment of premiums and
benefits under applicable worker’s compensation laws. There is no union
organizing campaign actually pending or, to the best knowledge of Seller,
threatened against or involving Seller. No collective bargaining or other labor
agreement is currently being negotiated by Seller and no union or collective
bargaining unit represents any of Seller’s employees. Seller has not experienced
any work stoppage or other material labor difficulty during the past five (5)
years.

 

Section 3.21 Customers and Vendors. No vendor of Seller has indicated that it
shall stop, or decrease the rate of, or substantially increase its fees for,
supplying products or services to Seller, as applicable, either prior to, or
following the consummation of, the Closing.

 

Section 3.22 Organizational Documents. Copies of the Seller Articles, certified
by the Secretary of State of Alabama, and the Seller Bylaws and any agreement
between Seller’s shareholders, certified by the president or chief executive
officer of Seller, have been furnished to Buyer and are a true, correct and
complete copies thereof as currently in effect.

 

Section 3.23 Outstanding Commitments. To the best knowledge of Seller, Seller is
not bound by any commitments for the performance of services or delivery of
products in excess of its ability to provide such services or deliver such
products during the time available to satisfy such commitments, and all
outstanding commitments for the performance of services or delivery of products
were made on a basis calculated to produce a profit under the circumstances
prevailing when such commitments were made.

 

Section 3.24 Acquired Assets. Seller is transferring to Buyer all of the assets,
other than the Excluded Assets, that are used in or are necessary to conducting
the Business as historically operated by Seller. Other than the Excluded Assets,
the Acquired Assets constitute all of such assets.

 

Section 3.25 Full Disclosure. The representations and warranties contained in
this Article IV do not contain nor will they contain any untrue statement of a
material fact or omit to state any known material fact necessary in order to
make the factual statements contained herein, in light of the circumstances
under which they were made, not misleading. To the best knowledge of Seller,
there are no adverse facts that have not been disclosed to Buyer in writing or
on schedules attached hereto relating to the Acquired Assets and operations of
the Business. The performance of due diligence shall not limit the
indemnification obligations of any party hereunder.

 

 

 

 

[*] Certain information in this document has been omitted from this exhibit
because it is both (i) not material and (ii) would be competitively harmful if
publicly disclosed.

 

Article IV

 

COVENANTS OF THE PARTIES

 

Section 4.1 Mutual Covenants.

 

(a) General. Each Party shall use all commercially reasonable efforts to take
all actions and do all things necessary, proper or advisable to consummate the
Acquisition and the other transactions contemplated by this Agreement for which
such Party is responsible to be satisfied as soon as reasonably practicable and
to prepare, execute, acknowledge or verify, deliver, and file such additional
documents, and take or cause to be taken such additional actions, as any other
Party may reasonably request to carry out the purposes or intent of this
Agreement.

 

(b) Other Governmental Matters. Each Party shall use all reasonable efforts to
take any additional action that may be necessary, proper or advisable in
connection with any other notices to, filings with, and authorizations, consents
and approvals of any court, administrative agency or commission, or other
governmental authority or instrumentality that it may be required to give, make
or obtain.

 

(c) Cooperation. On and after the Closing, each Party will cooperate with the
other Parties and execute and deliver to the other Parties such other
instruments and documents and take such other actions as may be reasonably
requested from time to time by the other Parties as necessary to carry out,
evidence and confirm the intended purposes of this Agreement. In addition, after
the Closing, Seller, at Buyer’s request, shall prepare, execute and deliver, at
the Seller’s expense, such further instruments of conveyance, sale, assignment
or transfer, and shall take or cause to be taken such other or further action as
Buyer shall reasonably request at any time or from time to time in order to
perfect, confirm or evidence in Buyer title to all or any part of the Acquired
Assets.

 

(d) Tax Matters. After Closing, the Parties will coordinate the preparation of
all necessary tax returns; provided however, Seller shall assume all
responsibility for, and shall timely perform, the filing and reporting
obligations required by Section 6043A of the Code and shall take all necessary
or appropriate actions to timely satisfy such obligations. Each Party agrees to
timely furnish to the other Parties any records and other information reasonably
requested by them in connection therewith. Buyer has not made any representation
as to the tax treatment of Seller, or any agreement with respect to refraining
from taking any future action that could adversely affect the tax treatment of
the Acquisition or tax consequences to Seller in connection therewith or
otherwise. Notwithstanding anything in this Agreement to the contrary, Seller
will remain solely liable for any tax consequences to it as a result of the
Acquisition.

 

(e) Further Assurances. After the Closing, Seller, at Buyer’s request, shall
prepare, execute and deliver, at Seller’s expense, such further instruments of
conveyance, sale, assignment or transfer, and shall take or cause to be taken
such other or further action as Buyer shall reasonably request at any time or
from time to time in order to be perfect, confirm or evidence in Buyer title to
all or any part of the Acquired Assets, or to put Buyer more fully in possession
of, any of the Acquired Assets, or to better enable Buyer to complete, perform
or discharge any of the Assumed Liabilities. Each Party will cooperate with the
other Parties and execute and deliver to the other Parties such other
instruments and documents and take such other actions as may be reasonably
requested from time to time by the other Parties as necessary to carry, out,
evidence and confirm the intended purposes of this Agreement.

 

(f) Forwarding of Funds. After the Closing, if any payment is received by Seller
for any periods of time from and after the Closing Date, or which represent any
portion of the Pending Sales Orders or other Acquired Assets by Buyer, Seller
shall immediately account for and provide such payment to Buyer.

 

(g) Notices of Certain Events. Seller shall promptly notify Buyer of:

 

(i) Any notice or other communication from any Person alleging that the consent
of such Person is or may be required in connection with the transactions
contemplated by this Agreement;

 

(ii) Any notice or other communication from any governmental or regulatory
agency or authority in connection with the transactions contemplated by this
Agreement; and

 

(iii) Any actions commenced or, to the best knowledge of Seller, threatened
against, relating to, involving, or otherwise affecting Seller or any of
Seller’s property, or any disputes, conflicts or circumstances providing the
basis for any dispute or conflict, that, if in existence on the date of this
Agreement would have been required to have been disclosed by Seller that relate
directly or indirectly to the consummation of the transactions contemplated by
this Agreement.

 

 

 

 

[*] Certain information in this document has been omitted from this exhibit
because it is both (i) not material and (ii) would be competitively harmful if
publicly disclosed.

 

(h) intentionally omitted.

 

(i) Continuation of Existence of Seller. Seller shall maintain Seller’s valid
existence and good standing under the laws of Dubai, at Seller’s own expense,
for a period commencing on the Effective Date and continuing until the 3 month
anniversary of the Effective Date.

 

(j) Delivery of Financial Statements. Seller shall cause:

 

(i) A Closing Date Balance Sheet to be delivered to Buyer on the Closing Date,
which must be accepted and approved by Buyer as a condition to closing.

 

(ii) Employees. Upon the Closing and effective as of the Effective Date, Seller
will terminate the employment of its employees, and Buyer (or one of or more of
Buyer’s affiliates) shall offer employment, effective as of the Effective Date,
to all such employees on an at-will basis. Seller will not take any action that
could impede, hinder, interfere, or otherwise compete with Buyer’s (or such
affiliate’s) effort to hire any such employee, and Seller shall undertake such
efforts as may be reasonably requested by Buyer to facilitate such efforts. In
no event shall Buyer (or such affiliate) be considered a successor employer.
Except to the extent in violation of applicable law, Seller shall promptly
furnish to Buyer all information relating to each employee of Seller as Buyer
may require in connection with its (or such affiliate’s) employment of such
persons, including, without limitation, initial employment date, termination
dates, reemployment dates, compensation and tax withholding history, which
information shall be true and correct in all material respects.

 

(k) Termination of Employee Plans; Benefit Arrangements. Seller shall cause all
Employee Plans and Benefit Arrangements of Seller to be terminated, and provide
Buyer with evidence of such termination, at or prior to the Closing. Buyer shall
provide continuation of the same or similar benefits to is employees after the
Closing, including health care and other similar benefits.

 

Article V

 

CONDITIONS

 

Section 5.1 Mutual Conditions. The obligations of each of the Parties to
consummate the Acquisition and the other transactions contemplated by this
Agreement shall be subject to fulfillment of all of the following conditions:

 

(a) No Adverse Proceeding. No temporary restraining order, preliminary or
permanent injunction or other order or decree which prevents the consummation of
the Acquisition or the other transactions contemplated by this Agreement shall
have been issued and remain in effect, and no statute, rule or regulation shall
have been enacted by any state or federal government or governmental agency
which would prevent the consummation of the Acquisition and the other
transactions contemplated by this Agreement.

 

(b) Governmental Approvals. Any governmental or other approvals or reviews of
this Agreement or the transactions contemplated by this Agreement required under
any applicable laws, statutes, orders, rules, regulations, or policies, or any
guidelines promulgated thereunder, shall have been received.

 

Section 5.2 Conditions to Obligations of Seller. The obligations of Seller to
consummate the Acquisition and the other transactions contemplated by this
Agreement shall be subject to the fulfillment of all of the following conditions
unless waived by Seller in writing.

 

(a) Representations and Warranties. The representations and warranties of Buyer
set forth in Article III of this Agreement shall be true and correct in all
material respects as of the Effective Date and as of the Closing Date.

 

(b) Performance of Agreement. Buyer shall have performed and observed in all
material respects all obligations and conditions to be performed or observed by
it under this Agreement at or prior to the Closing.

 

 

 

 

[*] Certain information in this document has been omitted from this exhibit
because it is both (i) not material and (ii) would be competitively harmful if
publicly disclosed.

 

Section 5.3 Conditions to Obligations of Buyer. The obligations of Buyer to
consummate the Acquisition and the other transactions contemplated by this
Agreement shall be subject to the fulfillment of all of the following conditions
unless waived by Buyer in writing:

 

(a) Representations and Warranties. The representations and warranties of Seller
set forth in Article III of this Agreement shall be true and correct in all
material respects as of the Effective Date and as of the Closing Date.

 

(b) Performance of Agreement. Seller shall have performed and observed in all
material respects all obligations and conditions to be performed or observed by
it under this Agreement at or prior to the Closing.

 

(c) Consents. Seller shall have obtained and delivered to Buyer all consents
Buyer deems necessary or desirable, in Buyer’s reasonable discretion, in order
to consummate the transactions contemplated herein.

 

(d) Due Diligence. Buyer shall have completed their due diligence investigation
of Seller and the Business pursuant to this Agreement and shall have been
satisfied in all respects with the results of such investigation.

 

Article VI

 

TERMINATION

 

Section 6.1 Termination Events. By notice given prior to the Closing, this
Agreement may be terminated as follows:

 

(a) by Buyer in its sole and absolute discretion any time prior to the
expiration of the Due Diligence Period;

 

(b) by Buyer if a material breach of any provision of this Agreement has been
committed by Seller or any Owner and such breach has not been cured by Seller
(after Notice and reasonable opportunity) or such breach is waived by Buyer;

 

(c) by Seller if a material breach of any provision of this Agreement has been
committed by Buyer and such breach has not been cured by Buyer (after Notice and
reasonable opportunity) or such breach is waived by Seller;

 

(d) by mutual consent of Buyer and Seller; or

 

(e) by either Buyer or Seller if the Closing has not occurred on or before the
date that is thirty (30) days from the expiration of the Due Diligence Period.

 

Section 6.2 Effect of Termination. Each Party’s right of termination under
Section 6.1 above is in addition to any other rights such Party may have under
this Agreement or otherwise, and the exercise of such right of termination will
not be an election of remedies.

 

Article VII

 

MISCELLANEOUS

 

Section 7.1 Notices. All notices and other communications under this Agreement
to any Party shall be in writing and shall be deemed given when delivered
personally to that Party, sent by electronic mail (“Email”) transmission (with
electronic confirmation) to that Party at the Email for that Party set forth
below, mailed by certified mail (postage prepaid and return receipt requested)
to that Party at the address for that Party set forth below, or delivered by
Federal Express or any similar express delivery service for delivery to that
Party at that address:

 

(a) If to Buyer:

 

Verus International, Inc.

9841 Washingtonian Boulevard, #390

Gaithersburg, MD 20878

Attn: Anshu Bhatnagar, Chief Executive Officer

Email: ab@verusfoods.com

 

With a copy to (which shall not constitute notice):

 

Sheppard Mullin Richter & Hampton LLP

30 Rockefeller Plaza, 38th Floor

New York, NY 10112

Attn: Andrea Cataneo, Esq.

Email: ACataneo@sheppardmullin.com

 

 

 

 

[*] Certain information in this document has been omitted from this exhibit
because it is both (i) not material and (ii) would be competitively harmful if
publicly disclosed.

 

(b) If to Seller: [*]

 

Any Party may change its Email or address for notices under this Agreement at
any time by giving the other Parties notice of such change.

 

Section 7.2 Non-Waiver. No failure by any Party to insist upon strict compliance
with any term or provision of this Agreement, to exercise any option, to enforce
any right, or to seek any remedy upon any default of any other Party shall
affect, or constitute a waiver of, the first Party’s right to insist upon such
strict compliance, exercise that option, enforce that right, or seek that remedy
with respect to that default or any prior, contemporaneous, or subsequent
default. No custom or practice of the Parties at variance with any provisions of
this Agreement shall affect or constitute a waiver of any Party’s right to
demand strict compliance with all provisions of this Agreement.

 

Section 7.3 Genders and Numbers. Where permitted by the context, each pronoun
used in this Agreement includes the same pronoun in other genders and numbers,
and each noun used in this Agreement includes the same noun in other numbers.

 

Section 7.4 Headings. The headings of the various Articles and Sections of this
Agreement are not part of the context of this Agreement, are merely labels to
assist in locating such Articles and Sections, and shall be ignored in
construing this Agreement.

 

Section 7.5 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original and all of which
together shall be deemed to be a single agreement. The signatures to this
Agreement need not all be on a single copy of this Agreement, and may be
facsimiles rather than originals, and shall be fully as effective as though all
signatures were originals on the same copy.

 

Section 7.6 Entire Agreement. This Agreement and the Additional Documents, all
of which are hereby incorporated by reference, constitute the entire agreement,
and supersede all prior or contemporaneous discussions, negotiations, agreements
and understandings (both written and oral) among the Parties with respect to the
subject matter hereof and thereof.

 

Section 7.7 No Third-Party Beneficiaries. Nothing contained in this Agreement,
express or implied, is intended or shall be construed to confer upon or give to
any Person, other than the Parties and any Indemnified Parties, any rights,
remedies or other benefits under or by reason of this Agreement.

 

Section 7.8 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware, without regard to principles
of conflicts of law. The Parties hereby irrevocably submit to the jurisdiction
of the courts in the State of Maryland (state or federal), with venue in
Montgomery County, over any dispute arising out of this Agreement and agree that
all claims in respect of such dispute or proceeding shall be heard and
determined in such court. All rights and remedies of each Party under this
Agreement shall be cumulative and in addition to all other rights and remedies
which may be available to the Party from time to time, whether under this
Agreement or otherwise.

 

Section 7.9 Binding Effect; Assignment. This Agreement shall be binding upon,
inure to the benefit of and be enforceable by and against the Parties and their
respective heirs, personal representatives, successors, and assigns. Neither
this Agreement nor any of the rights, interests or obligations under this
Agreement shall be transferred or assigned by any of the Parties without the
prior written consent of the other Parties. Notwithstanding the foregoing, Buyer
shall have the right to assign any of their respective rights, interests or
obligations under this Agreement, in whole or in part, to any company affiliated
with Buyer, as the case may be.

 

Section 7.10 Expenses. Each Party shall pay their own respective expenses and
fees associated with this transaction.

 

 

 

 

[*] Certain information in this document has been omitted from this exhibit
because it is both (i) not material and (ii) would be competitively harmful if
publicly disclosed.

 

Section 7.11 Severability. With respect to any provision of this Agreement
finally determined by a court of competent jurisdiction to be unenforceable,
such court shall have jurisdiction to reform such provision so that it is
enforceable to the maximum extent permitted by applicable law, and the Parties
shall abide by such court’s determination. In the event that any provision of
this Agreement cannot be reformed, such provision shall be deemed to be severed
from this Agreement, but every other provision of this Agreement shall remain in
full force and effect.

 

Section 7.12 Knowledge. Whenever a representation or warranty is made herein as
being to the “knowledge of” or “best knowledge of” a Party, it is understood
that such Persons have made or caused to be made (and the results thereof
reported to them) an investigation that provides them with a reasonable basis
upon which to determine the accuracy of such representation or warranty by
personnel or representatives competent to determine the accuracy thereof.

 

IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed
as of the day and year first above written.

 

THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK

 

SIGNATURE PAGE TO FOLLOW

 

 

 

 

[*] Certain information in this document has been omitted from this exhibit
because it is both (i) not material and (ii) would be competitively harmful if
publicly disclosed.

 

IN WITNESS WHEREOF, the parties hereto executed the foregoing Stock Purchase
Agreement effective the 30th day of August 2019.

 

Buyer: Verus International, Inc.   Seller: [*]           By: /s/ Anshu Bhatnagar
  By:

/s/ [*]

Name:  Anshu Bhatnagar   Officer: [*] Its: Chief Executive Officer   Its: Chief
Executive Officer