Exhibit 10.1

 

JOINT VENTURE Agreement

 

This JOINT VENTURE AGREEMENT (this “Agreement”), dated as of October 21, 2019,
is made by and among Healthbanks Biotech (USA) Inc., a California corporation
(“Healthbanks”), Cesca Therapeutics Inc., a Delaware corporation (“Cesca”), and
ImmuneCyte Life Sciences Inc., a Delaware corporation (the “Company”).
Healthbanks, Cesca and the Company are each referred to herein as a “Party” and,
collectively, as the “Parties.”

 

recitals

 

WHEREAS, the Parties desire to form a joint venture on the terms set forth
herein in connection with the development and commercialization of Cesca’s
cellular processing technologies for a new immune cell banking service.

 

NOW, THEREFORE, in consideration of the foregoing and the respective
representations, warranties, covenants and agreements set forth herein, and
subject to the terms and conditions set forth herein, the Parties hereby agree
as follows:

 

ARTICLE I
Strategic Initiative Transactions

 

1.1     Contribution and Issuance of Shares. Concurrently with the execution of
this Agreement:

 

(a)     the Company is issuing 8,000,000 shares of the Class B common stock of
the Company, par value $0.001 per share (the “Class B Common Stock”) to
Healthbanks;

 

(b)     simultaneously therewith, the Company is issuing in the aggregate
2,000,000 shares of the Class A-1 common stock of the Company, par value $0.001
per share, the “Class A-1 Common Stock,” and the Class A-1 Common Stock together
with the Class B Common Stock and the below defined Class A-2 Common Stock, the
“Common Stock”) to Cesca (the transactions described in clause (a) and this
clause (b), the “Issuances”); and

 

(c)     immediately after the Issuances, (i) Healthbanks shall hold 8,000,000
shares of Class B Common Stock, and no other equity interests in the Company and
(ii) Cesca shall hold 2,000,000 shares of Class A-1 Common Stock, and no other
equity interests in the Company.

 

1.2     Consummation of Joint Venture. Healthbanks and Cesca have agreed that
the joint venture will have materially the terms set forth in the “term sheet”
attached hereto as Exhibit A (the “Term Sheet”). The Parties (a) shall each
reasonably promptly cooperate to draft, execute, and deliver, or shall cause to
be executed and delivered, such definitive documents and other instruments and
shall take, or shall cause to be taken, such further action as may be reasonably
necessary to carry out the Term Sheet and the provisions of this Agreement and
give effect to the transactions contemplated hereby and thereby, and (b) shall
refrain from taking any actions that could reasonably be expected to impair,
delay or impede the consummation of the transactions contemplated by the Term
Sheet or by this Agreement. The Parties agree that they shall enter into
definitive documents to affect the transactions described by the Term Sheet on
or before December 31, 2019 (the “Closing”). At the Closing, each Party will
deliver duly executed counterparts of a contribution agreement, stockholders’
agreement, supply agreement and other agreements contemplated by the Term Sheet.

 

 

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ARTICLE II
representations and warranties of THE PARTIES

 

Each Party hereby represents and warrants to each other Party as follows:

 

2.1     Organization. Such Party is duly incorporated, validly existing and in
good standing under the Laws of its state of incorporation

 

2.2    Authorization. Such Party has full corporate power and authority to
execute, deliver and perform its obligations under this Agreement, and to
consummate the transactions contemplated by this Agreement. This Agreement has
been duly authorized by the board of directors of such Party. This Agreement has
been duly and validly executed and delivered by such Party and constitutes the
legal, valid and binding obligation of such Party enforceable against such Party
in accordance with its terms, subject to applicable bankruptcy, insolvency,
reorganization, moratorium, liquidation, fraudulent conveyance and other similar
laws and principles of equity affecting creditors’ rights and remedies
generally.

 

2.3     No Conflict. The execution and delivery of this Agreement by such Party
and the consummation of the transactions contemplated by this Agreement will not
violate any Law to which such Party is subject or any provision of the articles
of incorporation or bylaws of such Party or any other agreement or understanding
by which such Party is bound. Such Party is not required to give any notice to,
make any filing with, or obtain any authorization, consent or approval of any
Governmental Authority or any other Person in connection with the consummation
of the transactions contemplated by this Agreement, other than as have been
given, made, or obtained already.

 

2.4     Actions and Claims. There are no civil, criminal or administrative
actions, investigations, proceedings, suits, demands or claims filed or
conducted by or before any Governmental Authority, arbitrator or mediator
pending or threatened against such Party relating to the transactions
contemplated by this Agreement.

 

2.5     No Additional Representations. Notwithstanding any other provision in
this Agreement, except for the representations and warranties expressly set
forth in this Article II and Article III or in definitive agreement entered into
pursuant hereto, such Party acknowledges that no other Party nor any of its
Affiliates or representatives makes, will make, or has made any express or
implied representation or warranty whatsoever.

 

2.6     Independent Analysis. Each Party confirms that such Party has had made
available to it the opportunity to ask questions of each other Party, to access
all materials, documents and other information that it deems necessary or
advisable to evaluate the transactions contemplated by this Agreement. Each
Party has made its own independent examination, investigation, analysis and
other relevant evaluation of the transactions contemplated by this Agreement and
has undertaken such due diligence as it deems adequate.

 

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2.7     Brokers. Such Party has not entered into any agreement or understanding
with any Person which may result in the obligation of any Party to pay any fees
or commissions to any broker or finder or Person providing comparable or similar
services as a result of the execution and delivery of this Agreement or the
consummation of the transactions contemplated herein.

 

 

ARTICLE III
representations and warranties of The Company

 

The Company hereby represents and warrants to Healthbanks and Cesca as follows:

 

3.1     Capitalization. The authorized capital stock of the Company consists of
12,000,000 shares of Common Stock, consisting of 8,000,000 shares of Class B
Common Stock, 2,000,000 shares of Class A-1 Common Stock, and 2,000,000 shares
of Class A-1 Common Stock. After giving effect to the Issuances, 8,000,000
shares of Class B Common Stock are held by Healthbanks, 2,000,000 shares of
Class A-1 Common Stock are held by Cesca, and no other shares of Common Stock
are held by any other Person. All of the issued and outstanding shares of Common
Stock were duly authorized for issuance, are validly issued, fully paid and
non-assessable, have not been issued in violation of any preemptive or similar
rights and have been offered, issued, sold and delivered by the Company in
compliance with all applicable Laws. There are no declared but unpaid dividends
or distributions with regard to any issued and outstanding shares of Common
Stock. There are no options, warrants, calls, or other rights or securities
exercisable or exchangeable or convertible for any shares or other equity
interests in the Company. There are no outstanding phantom stock, profit
participation or other similar rights with respect to the Company or any shares
of Common Stock.

 

3.2     Subsidiaries. The Company does not own, nor has the Company ever owned,
equity interests in any Person.

 

3.3     No Liabilities. The Company has no liabilities, known or unknown,
contingent or otherwise, except for those arising from its obligations arising
under this Agreement and any agreement executed in connection herewith. The
Company has not operated any business prior to the Issuances.

 

ARTICLE IV
covenants

 

4.1     Commercially Reasonable Efforts. Subject to the terms and conditions of
this Agreement, each Party will use commercially reasonable efforts to take, or
cause to be taken, all actions and do, or cause to be done, all things
necessary, proper or advisable in connection with this Agreement and applicable
Law to consummate the transactions contemplated by this Agreement as promptly as
practicable, including (i) preparing and filing as promptly as practicable with
any Governmental Authority or other Person all documentation to effect all
necessary filings, notices, petitions, statements, registrations, submissions of
information, applications and other documents and (ii) obtaining and maintaining
all approvals, consents, registrations, permits, authorizations and other
confirmations required to be obtained from any Governmental Authority or other
Person that are necessary to consummate the Joint Venture Transactions and the
transactions contemplated hereby.

 

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ARTICLE V
MISCELLANEOUS

 

5.1     Expenses. Unless otherwise expressly set forth herein, all costs and
expenses (including all legal, accounting, broker, finder or investment banker
fees) incurred in connection with the Joint Venture Transactions, this Agreement
and the transactions contemplated hereby and thereby shall be paid by the Party
incurring such cost or expense.

 

5.2     Successors and Assigns; Third-Party Beneficiaries. This Agreement is
binding upon and inures to the benefit of the Parties and their respective
successors and permitted assigns. No Party may assign any of such Party’s rights
or delegate any of such Party’s obligations under this Agreement to any Person
without the prior written consents of the other Parties to this Agreement, and
any purported assignment or delegation without such prior written consents will
be void and of no effect. Except as expressly contemplated herein, each Party
intends that this Agreement does not benefit or create any right or cause of
action in or on behalf of any Person other than the Parties.

 

5.3     Notices. Except as otherwise specifically set forth in this Agreement,
all notices and communications hereunder will be deemed to have been duly given
and made on (a) the date such notice is served by personal delivery upon the
Party for whom it is intended, (b) the date sent if delivered by email so long
as such notice and communication is furnished to a nationally recognized
overnight courier for next Business Day delivery, (c) three Business Days after
mailing if sent by certified or registered mail, return receipt requested, or
(d) one Business Day after being furnished to a nationally recognized overnight
courier for next Business Day delivery, in each case to the Person at the
applicable address or email address set forth below:

 

If to Healthbanks:

 

185 Technology Drive, Suite 150
Irvine, CA 92618
Attention: Billie Ahluwalia, Principal Accounting Officer
Email: bahluwalia@healthbanks.us

 

If to Cesca:

 

Cesca Therapeutics Inc.
2711 Citrus Road
Rancho Cordova, CA 95742
Attention: Jeff Cauble, VP of Finance, Principal Accounting Officer
Email: jcauble@cescatherapeutics.com

 

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with a copy to (which will not constitute notice):

 

Foley & Lardner LLP
100 N. Tampa St., Suite 2700
Tampa, Florida 33602
Attention: Curt P. Creely, Esq.
Email: ccreely@foley.com

 

If to the Company:

 

185 Technology Drive, Suite 150
Irvine, CA 92618
Attention: Billie Ahluwalia, Principal Accounting Officer
Email: bahluwalia@healthbanks.us

 

Any Party may change the address, email address or the Persons to whom notices
or copies hereunder will be directed by providing written notice to the other
Parties of such change in accordance with this Section 5.3.

 

5.4     Complete Agreement. This Agreement, the Schedule and the Exhibits
attached hereto and the other documents delivered and contemplated to be
delivered by the Parties in connection herewith contain the complete agreement
between the Parties with respect to the transactions contemplated hereby and
thereby and supersede all prior agreements and understandings (whether written
or oral) between the Parties with respect thereto.

 

5.5     Certain Definitions. As used in this Agreement:

 

(a)     “Affiliate” means, with respect to any Person, any other Person that,
directly or indirectly through one or more intermediaries, controls, or is
controlled by, or is under common control with, such Person.

 

(b)     “Business Day” means any day other than a Saturday, Sunday, or day on
which the Federal Reserve Bank sitting in New York, New York is authorized to be
closed.

 

(c)     “Governmental Authority” means any federal, state, national,
international, provincial, municipal or other governmental department,
commission, board, bureau, agency, legislative or administrative body,
instrumentality, or any court or tribunal of the United States, any of its
possessions or territories, or any state.

 

(d)     “Law” means any federal, state, national, tribal, provincial, local or
other law, rule of common law, constitution, treaty, statute, act, code,
ordinance or other governmental requirement of any kind, and the rules,
regulations and orders promulgated thereunder.

 

(e)     “Person” means any individual, corporation, partnership, limited
liability company, association, trust, Governmental Authority, unincorporated
entity or other legal entity.

 

5.6     Amendment. This Agreement may be amended or modified only by an
instrument in writing duly executed by the Parties.

 

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5.7     Waiver. At any time, the Parties may (a) extend the time for the
performance of any of the obligations or other acts of the Parties, (b) waive
any inaccuracies in the representations and warranties contained herein or in
any document delivered pursuant hereto or (c) waive compliance with any of the
covenants, agreements or conditions contained herein, to the extent permitted by
applicable Law. Any agreement to any such extension or waiver will be valid only
if set forth in a writing signed by the applicable Party making the waiver. No
waiver of any provision hereunder or any breach or default thereof will extend
to or affect in any way any other provision or prior or subsequent breach or
default.

 

5.8     Governing Law; Consent to Jurisdiction. This Agreement is to be governed
by, and construed and enforced in accordance with, the internal Laws of the
State of Delaware, without regard to its rules of conflict of laws. Each of the
Parties agrees (a) that this Agreement involves at least $100,000.00, and (b)
that this Agreement has been entered into by each of the Parties in express
reliance upon 6 Del. C. § 2708. Each of the Parties irrevocably submits to the
exclusive jurisdiction of the Delaware Court of Chancery in New Castle County,
or in the event (but only in the event) that such court does not have subject
matter jurisdiction over such action, the United States District Court for the
District of Delaware, or in the event (but only in the event) that such court
does not have subject matter jurisdiction over such action, any state court in
the State of Delaware (all such courts, a “Court”). A final judgment in any such
action shall be conclusive and may be enforced in other jurisdictions by suit on
the judgment or in any other manner provided by Law. Each of the Parties
irrevocably agrees: (1) to the extent such Party is not otherwise subject to
service of process in the State of Delaware, to appoint and maintain an agent in
the State of Delaware as such Party’s agent for acceptance of legal process and
notify each of the other Parties of the name and address of such agent, and (2)
that service of process may, to the fullest extent permitted by applicable Law,
also be made on such Party, at its address for notices provided for in this
Agreement, by prepaid certified mail with a proof of mailing receipt validated
by the United States Postal Service constituting evidence of valid service, and
that service made pursuant to (1) or (2) above shall, to the fullest extent
permitted by applicable Law, have the same legal force and effect as if served
upon such Party personally within the State of Delaware. Each Party irrevocably
agrees not to assert (x) any objection which it may ever have to the laying of
venue of any such action in the applicable Court and (y) any claim that any such
action brought in any such Court has been brought in an inconvenient forum.

 

5.9     Waiver of Jury Trial. TO THE EXTENT NOT PROHIBITED BY APPLICABLE LAW
WHICH CANNOT BE WAIVED, EACH OF THE PARTIES HEREBY WAIVES AND COVENANTS THAT IT
WILL NOT ASSERT (WHETHER AS PLAINTIFF, DEFENDANT OR OTHERWISE) ANY RIGHT TO
TRIAL BY JURY IN ANY FORUM IN RESPECT OF ANY ACTION ARISING OUT OF OR BASED UPON
THIS AGREEMENT OR THE SUBJECT MATTER HEREOF, IN EACH CASE WHETHER NOW EXISTING
OR HEREAFTER ARISING. EACH PARTY ACKNOWLEDGES THAT SUCH PARTY HAS BEEN INFORMED
BY THE OTHER PARTIES THAT THIS SECTION 5.9 CONSTITUTES A MATERIAL INDUCEMENT
UPON WHICH THE PARTIES ARE RELYING AND WILL RELY IN ENTERING INTO THIS AGREEMENT
AND ANY OTHER AGREEMENTS RELATING HERETO OR CONTEMPLATED HEREBY. ANY PARTY MAY
FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION 5.9 WITH ANY COURT AS
WRITTEN EVIDENCE OF THE CONSENT OF THE PARTIES TO THE WAIVER OF THE RIGHT TO
TRIAL BY JURY.

 

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5.10     Severability. Any term or provision of this Agreement that is found to
be invalid or unenforceable in any jurisdiction will, as to that jurisdiction,
be ineffective to the extent of such invalidity or unenforceability without
rendering invalid or unenforceable the remaining terms and provisions of this
Agreement or affecting the validity or enforceability of any of the terms or
provisions of this Agreement in any other jurisdiction. If any provision of this
Agreement is found to be so broad as to be unenforceable, the provision will be
interpreted to be only so broad as is enforceable.

 

5.11     Counterparts. This Agreement may be executed in two or more
counterparts, each of which will be deemed an original but all of which will
constitute but one instrument. This Agreement is effective upon delivery of one
executed counterpart from each Party to the other Parties. The signatures of all
of the Parties need not appear on the same counterpart. The delivery of signed
counterparts by email which includes a copy of the sending party’s signature(s)
(including by “.pdf” format) is as effective as signing and delivering the
counterpart in person.

 

5.12     Enforcement of Agreement. Each Party’s obligation under this Agreement
is unique. The Parties acknowledge that money damages would not be an adequate
remedy at law if any Party fails to perform in any material respect any of its
obligations hereunder and accordingly agree that each Party, in addition to any
other remedy to which it may be entitled under this Agreement, at law or in
equity, shall be entitled to an injunction or similar equitable relief
restraining such Party from committing or continuing any such breach or
threatened breach or to seek to compel specific performance of the obligations
of any other Party under this Agreement, without the posting of any bond, in
accordance with the terms and conditions of this Agreement in any court of the
United States or any State thereof having jurisdiction, and if any action should
be brought in equity to enforce any of the provisions of this Agreement, none of
the Parties shall raise the defense that there is an adequate remedy at law. No
remedy shall be exclusive of any other remedy, and all available remedies shall
be cumulative.

 

5.13     Construction. The Parties have participated jointly in the negotiation
and drafting of this Agreement. If an ambiguity or question of intent or
interpretation arises, then this Agreement will be construed as drafted jointly
by the Parties and no presumption or burden of proof will arise favoring or
disfavoring any Party by virtue of the authorship of any of the provisions of
this Agreement. Unless otherwise indicated to the contrary herein by the context
or use thereof: (a) any reference or citation in this Agreement to any contract
or any federal, state, local or foreign statutes, regulations or other Laws or
statutory or regulatory provision shall, when the context requires, be deemed
references or citations to such contracts, statutes, regulations, other Laws or
provisions, as amended, modified and supplemented from time to time (and, in the
case of a statute, regulation or other Law, to (i) any successor provision and
(ii) all rules and regulations promulgated thereunder); (b) all references to
the preamble, recitals, Sections, Articles or Exhibits are to the preamble,
recitals, Sections, Articles or Exhibits of or to this Agreement; (c) the words
“herein”, “hereto”, “hereof”, “hereunder” and words of similar import refer to
this Agreement as a whole and not to any particular section or paragraph hereof;
(d) masculine gender will also include the feminine and neutral genders and vice
versa; (e) words importing the singular will also include the plural, and vice
versa; (f) the words “include”, “including” and “or” mean without limitation by
reason of enumeration; (g) all references to “$” or dollar amounts are to lawful
currency of the United States of America; (h) the terms “delivered” or “made
available” or similar phrases when used in this Agreement will mean that such
documents or other information has been physically or electronically delivered
to the relevant parties, including via a virtual data room; and (i) time periods
within or following which any payment is to be made or any act is to be done
will be calculated by excluding the day on which the time period commences and
including the day on which the time period ends and by extending the period to
the next Business Day following if the last day of the time period is not a
Business Day.

 

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

 

     

Healthbanks:

 

Healthbanks Biotech (USA) Inc.

 

 

By: /s/ Billie Ahluwalia

Name: Billie Ahluwalia

Title:   Principal Accounting Officer

 

 

 

 

 

Cesca:

 

Cesca Therapeutics Inc.

 

 

By: /s/ Jeff Cauble

Name: Jeff Cauble

Title:   VP of Finance, Principal Accounting Officer

 

 

 

 

 

The Company:

 

ImmuneCyte Inc.

 

 

By: /s/ Billie Ahluwalia

Name: Billie Ahluwalia

Title:   Principal Accounting Officer

 

 

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Exhibit A

 

TERM SHEET

 

JOINT VENTURE BETWEEN HEALTHBANKS BIOTECH (USA) INC.
AND CESCA THERAPEUTICS INC.

 

 

 

This term sheet sets forth certain key terms of a proposed joint venture (the
“Joint Venture”) between Healthbanks Biotech (USA) Inc., a California
corporation (“Healthbanks”) with principal office at 185 Technology Drive, Suite
150, Irvine, CA 92618, and Cesca Therapeutics Inc., a Delaware corporation
(“Cesca”) with principal office at 2711 Citrus Road, Rancho Cordova, CA 95742,
relating to development and commercialization of Cesca’s proprietary cell
processing platform for the use in immune cell banking and cell-based contract
development and manufacturing service (CMO/CDMO) field, including immune cell
processing, cryostorage, and other cellular manufacturing services for cell and
gene therapies (the “Business”). This term sheet set forth the key terms and
guidelines for the Joint Venture and the final binding legal obligations,
rights, or duties with respect to the parties referred to herein. This term
sheet does not purport to be a complete description of the proposed Joint
Venture and the terms to be included in the definitive transaction documents,
and in the event of a conflict between the definitive transaction documents and
the provisions of this term sheet, the definitive transaction documents will
prevail.

 

PURPOSE:

Cesca is engaged in the research, development, and commercialization of
cell-based therapeutics for use in regenerative medicine. The Company currently
operates two divisions, ThermoGenesis and Cesca Clinical Division.

 

Cesca intends to be spin out its clinical assets and to be more focused on the
development and commercialization of scientific tools and services for the cell
& gene therapies. Cesca also intends to further expand its automated cell
processing technology to CMO/CDMO service areas, through the Joint Venture.

 

Healthbanks has FDA certified and AABB accredited laboratory facility and
business expertise and know-how in the cell banking industrial sector. Cesca and
Healthbanks intends to form a Joint Venture to develop and commercialize Cesca’s
proprietary cellular processing platform for the use in CMO/CDMO field,
including immune cell processing, cryostorage, and other cellular manufacturing
services for cell and gene therapies.

       

SCOPE OF JOINT VENTURE:

The Joint Venture, is to be formed by and between Healthbanks and Cesca,
focusing to develop and commercialize Cesca’s proprietary cellular processing
platform for the use in CMO/CDMO field, including immune cell processing,
cryostorage, and other cellular manufacturing services for cell and gene
therapies.

 

Exhibit A Page 1 of 8

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NAME OF JOINT VENTURE:

The name of the Joint Venture is to be ImmuneCyte Inc, organized as C Corp
incorporation under the laws of the State of Delaware.

   

HEALTHBANKS’ CAPITAL CONTRIBUTIONS

Healthbanks’ initial capital contribution to the Joint Venture will be comprised
of the following:

 

●     Initial Cash Contributions: An initial cash contribution in the amount of
one (1) million USD unsecured, non-convertible, line-of-credit, carrying a 10%
discount interest rate; and

 

●     Proprietary Technology and Know How: Healthbanks provides the following
proprietary technology and know-hows to the joint venture:

 

o    A license free and royalty free usage of the proprietary Business
Management System (BMS) (software that supports business operation).

 

o    A license free and royalty free usage of the proprietary Customer
Relationship Management (CRM) (software that supports business operation).

 

o    A license free and royalty free usage of the proprietary Laboratory
Information System (LIS) (software that supports business operation).

 

●     Facilities and Services: Healthbanks provides the following cGMP facility
infrastructure and services for the immune cell processing and cryostorage
services, pursuant to a Facilities and Services Agreement, at a price of “Basic
Cost + 15%”.

 

o    Use of 50% of the 18,000 sq. ft. of FDA certified laboratory and office
facilities currently located at 185 Technology Dr., Suite #150, Irvine,
California (the “Facility”).

 

o    Use of the regulatory, quality assurance and laboratory staff support by
the Joint Venture based on billing between the parties.

   

CESCA’S CAPITAL CONTRIBUTIONS:

Cesca’s capital contribution to the Joint Venture will be comprised of the
following:

 

●     Initial Cash Contributions: There is no initial cash contribution by
Cesca; and

 

Exhibit A Page 2 of 8

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●     Exclusive Supply Agreement and Related Technology License: Cesca will
enter into a supply agreement with the Joint Venture under which the Joint
Venture will have the worldwide, perpetual exclusive right to purchase Cesca’s
proprietary cell processing equipment in the immune cell banking business and a
non-exclusive right to purchase it for other cell-based contract development and
manufacturing (CMO/CDMO) services. Cesca will also provide related support and
maintenance services and will grant the Joint Venture an exclusive license to
use the Cesca technology necessary to use the purchased equipment in the immune
cell banking business. Cesca will also provide the use of the regulatory,
quality assurance and engineer staff support by the Joint Venture. The equipment
and services under the Supply Agreement will be provided at a price of “Basic
Cost + 15%”.

 

●     Clinical Assets: The following clinical assets:

 

o    Spin off intellectual properties and trademarks related to Cesca’s clinical
program (Appendix I).

   

DEFINITION OF BASIC COST:

For rent lease, utility bill, phone service bill, it means direct cost paid to
third parties. For intercompany charge of labors and services commanded by the
joint venture, it means the salary and fringe benefits of the service provider’s
employees. For equipment, it means of the purchasing price linearly amortized
over five (5) year periods. For reagents used, it means direct price paid to
third party. For laboratory quality certifications, it means the direct cost
associated with the certification processes. Other undefined costs are to be
negotiated under good faith between the parties.

   

EQUITY OWNERSHIP AND CAPITALIZATION:

The Joint Venture will initially be owned 80%/20% by Healthbanks and Cesca,
respectively. It is the parties’ intent that the capital contributions of each
of Healthbanks and Cesca will be made pursuant to a Section 351 tax-free
exchange, with Healthbanks being issued 8,000,000 shares of common stock of the
Joint Venture and Cesca being issued 2,000,000. All of the initial capital of
the Joint Venture will be contributed as common equity, with all shares having
one vote per share (except that Healthbanks will hold a class of common stock
with 100 votes per share). There will be not initially be any preferred equity
in the Joint Venture.

   

CESCA ANTI-DILUTION:

Cesca’s interest in the Joint Venture will be subject to anti-dilution
protection such that with respect to any issuance other than a Qualified
Issuance, Cesca will maintain the full $5,000,000 value of its interest. A
“Qualified Issuance” is any issuance of equity securities by the Joint Venture
to institutional investors in an aggregate amount of at least $1,000,000 at
a valuation for the Joint Venture of at least $25,000,000. Cesca’s anti-dilution
protection will terminate upon a Qualified Issuance.

 

Exhibit A Page 3 of 8

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MINORITY PROTECTIONS AND INFORMATION RIGHTS:

Before the valuation for the Joint Venture reaches $25,000,000. Cesca has the
right to nominate at least one board member and veto right on issuing new
equity, shares, and major transactions related to purchase and sale of assets.
Cesca’s minority protection will terminate upon a Qualified Issuance.  The Joint
Venture will grant to Cesca customary information rights, including the right to
receive quarterly and annual financial statements and the right to receive other
financial and capitalization information regarding the Joint Venture. In
addition, Cesca will have the right to require that the Joint Venture’s annual
financial statements be audited.

   

MANAGEMENT OF JOINT VENTURE:

The Joint Venture will be managed by a board of directors (the “Board”)
comprised initially of 3 persons, of which at least one (1) persons will be
appointed by Cesca. Except as provided under “MAJOR DECISIONS” below, the Board
will have full management and control of the Joint Venture and the Business, and
any action or decision by the Board will require the affirmative vote of at
least a majority of the members of the Board.

 

The day-to-day operations of the Joint Venture will initially be managed by the
interim general manager. A search of the Chief Executive Officer will commence
soon after the formation of the Joint Venture. The Board will oversee and assign
necessary executive during the interim period.

   

MAJOR DECISIONS:

Before the valuation for the Joint Venture reaches $25,000,000, the following
actions by the Joint Venture will require the approval of both Healthbanks and
Cesca:

 

●     The issuance of new equity, or creation of new classes of equity.

 

●     The incurrence of debt above $10 million.

 

●     The sale of material assets or IP.

   

OFFICE AND OPERATIONS:

The Joint Venture will maintain its principal office and operations at the
Facility. The address of the Joint Venture’s principal office will be at 185
Technology Drive, Suite 150, Irvine, CA92618.

   

TRANSFER RESTRICTIONS:

Neither party will be permitted to transfer its interest in the Joint Venture
without the prior written consent of the other party.

   

INTELLECTUAL PROPERTY:

Intellectual property will be owned as follows:

 

●     Each party’s background intellectual property will continue to belong to
such party.

 

●     Newly developed intellectual property developed by the Joint Venture will
be the property of the Joint Venture.

 

Exhibit A Page 4 of 8

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PRINCIPAL TERMS OF SUPPLY AGREEMENT:

The following will be the principal terms of the Cesca Supply Agreement to the
Joint Venture:

 

●      General Scope. This Agreement specifies the terms and conditions under
which Cesca agrees to sell its equipment and provide its services related to the
Business as described above.

 

●     Exclusivity. Supplier agrees to grant worldwide, perpetual exclusive
rights to the Joint Venture to purchase Cesca’s proprietary equipment and, in
connection therewith, use Cesca’s technology for the immune cell banking
service, and non-exclusive rights to other CMO/CDMO service business defined.

 

●      Indemnity. Cesca shall not be liable to the Joint Venture for any injury,
damage or loss due to the use of Cesca Technology. The Joint Venture, agrees to
indemnify and hold harmless Cesca from any loss, expense or claims arising out
of using Cesca Technology.

   

PRINCIPAL TERMS OF THE FACILITIES AND SERVICES AGREEMENT:

The following will be the principal terms of the Healthbanks Facilities and
Services Agreement:

 

●      Location. The United States Food and Drug Administration certified lab
and office facilities are currently located and operated by Healthbanks at 185
Technology Dr., Suite #150, Irvine, California. Initially, 50% of the Facility
is assigned for use by the Joint Venture.

 

●      Access and Use. During the Term, the Joint Venture and its employees,
contractors, subcontractors and invitees shall have access to the Facility for
the purposes of the Business or as otherwise permitted by the Parties or by the
terms of this Agreement.

 

●     Compliance with Laws, Regulations and Rules. In conducting the Business,
the Joint Venture shall adhere and shall cause its employees, contractors,
and/or invitees to adhere to all laws, rules and regulations applicable to the
Required Standard, the use and occupancy of the Facility, and all safety
requirements, guidelines, or rules that Healthbanks has established with respect
to the Facility.

 

●      Indemnity. Healthbanks shall not be liable to the Joint Venture for any
injury, damage or loss on or about the Facility or any adjacent area. The Joint
Venture, agrees to indemnify and hold harmless Healthbanks from any loss,
expense or claims arising out of using the Facility.

 

Exhibit A Page 5 of 8

--------------------------------------------------------------------------------

 

 

 

●      Services and Compensation. During the Term, Healthbanks shall provide to
the Joint Venture the services of laboratory, quality and regulatory staff in
connection with the Business in accordance with the required standards. The
Company shall reimburse Healthbanks on a monthly basis for its Costs (defined
previous) plus 15%.

 

●     Required Standard. The services performed hereunder in connection with the
Business shall be performed in good faith, with reasonable care and shall be
performed in a timely manner consistent with Healthbanks’ historical practice.

   

PRINCIPAL TERMS OF CONTRIBUTION AGREEMENT:

The following will be the principal terms of the Contribution Agreement:

 

●      Assets. Each contributor transfers and conveys to the Joint Venture, free
and clear of all liens, claims, and encumbrances, all of the assets described in
Healthbanks Capital Contributions and CESCA Capital Contributions (the
“Assets”).

 

●     No Representations. The Joint Venture will acknowledge that each
contributors has not made, and disclaims any and all, representations and
warranties to the Joint Venture with respect to the Assets, other than for
Contributor’s representations (made hereby) that: (i) contributor has sole,
exclusive, good and marketable title free and clear of all liens to the Assets;
and (ii) Contributor has all requisite corporate power and authority to execute,
deliver and perform this Bill of Sale and the transactions contemplated hereby,
without violating any known third party rights, and when executed by
contributor, the Bill of Sale will be enforceable against Contributor. The Joint
Venture agrees that, subject to the foregoing representations, it is taking the
Assets on an “as is”/ “where is” basis.

   

BINDING:

Once executed, this term sheet shall be a binding agreement of the parties. The
parties shall negotiate in good faith to conclude and execute final definitive
documentation that reflects key terms and guidelines for the Joint Venture set
forth in this term sheet no later than December 31, 2019. The failure to agree
upon such documentation shall not void this term sheet. Any party terminates
without reason shall pay a penalty of $500,000 USD.

   

GOVERNING LAW, DISPUTE RESOLUTION:

The Contribution Agreement and related agreements will all be governed by the
law of the State of California or Delaware.

 

[blank below]

 

Exhibit A Page 6 of 8

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APPENDIX I

 

FILE NUMBER

TITLE

COUNTRY

STATUS

TYPE

APPLICATN #

FILE DATE

PATENT #

ISSUE DATE

EST. EXP.

DATE

P262641.CN‐HK.01

RAPID INFUSION OF AUTOLOGOUS BONE MARROW DERIVED STEM CELLS

Hong Kong

Published

Utility

16105929.7

5/24/2016

     

P262641.US.01

RAPID INFUSION OF AUTOLOGOUS BONE MARROW DERIVED STEM CELLS

United States of America

Issued

Utility

14/296,360

6/4/2014

9,439,930

9/13/2016

1/29/2033

P262641.US.02

RAPID INFUSION OF AUTOLOGOUS BONE MARROW DERIVED STEM CELLS

United States of America

Issued

Utility

14/297,565

6/5/2014

9,402,867

8/2/2016

1/12/2033

P262641.US.03

RAPID INFUSION OF AUTOLOGOUS BONE MARROW DERIVED STEM CELLS

United States of America

Issued

Utility

14/297,557

6/5/2014

9,393,269

7/19/2016

1/12/2033

P262641.WO.01

RAPID INFUSION OF AUTOLOGOUS BONE MARROW DERIVED STEM CELLS

PCT

Completed

Utility

PCT/US2014/01 0745

1/8/2014

     

P262641.WO‐CN.01

RAPID INFUSION OF AUTOLOGOUS BONE MARROW DERIVED STEM CELLS

China

Allowed

Utility

201480014602.0

1/8/2014

     

P262641.WO‐IN.01

RAPID INFUSION OF AUTOLOGOUS BONE MARROW DERIVED STEM CELLS

India

Pending

Utility

7120/DELNP/2015

1/8/2014

     

P262641.WO‐JP.01

RAPID INFUSION OF AUTOLOGOUS BONE MARROW DERIVED STEM CELLS

Japan

Allowed

Utility

2015‐552751

1/8/2014

     

 

 

Page 7 of 8

--------------------------------------------------------------------------------

 

 

FILE NUMBER

TITLE

COUNTRY

STATUS

TYPE

APPLICATN #

FILE DATE

PATENT #

ISSUE DATE

EST. EXP.

DATE

P262642.US.01

INTRAMUSCULAR ADMINISTRATION OF AUTOLOGOUS BONE MARROW FOR

TREATMENT

United States of America

Completed

Prov

62/156,126

5/1/2015

     

P262642.WO.01

INTRAMUSCULAR ADMINISTRATION OF AUTOLOGOUS BONE MARROW FOR

TREATMENT

PCT

Completed

Utility

PCT/US2016/02 9863

4/28/2016

     

P262642.WO‐CN.01

INTRAMUSCULAR ADMINISTRATION OF AUTOLOGOUS BONE MARROW FOR

TREATMENT

China

Published

Utility

201680038228.7

4/28/2016

     

P262642.WO‐IN.01

INTRAMUSCULAR ADMINISTRATION OF AUTOLOGOUS BONE MARROW FOR

TREATMENT

India

Pending

Utility

201717039350

4/28/2016

     

P262642.WO‐US.01

INTRAMUSCULAR ADMINISTRATION OF AUTOLOGOUS BONE MARROW FOR

TREATMENT

United States of America

Published

Utility

15/571,244

4/28/2016

   

4/28/2036

 

Page 8 of 8