Document:

Exhibit 4.2

Execution Version

INVESTOR RIGHTS AGREEMENT

This Investor Rights Agreement (this "Agreement") is made and entered into as of March 1, 2016 (the "Effective Date") by and among Pinnacle Financial Partners, Inc., a Tennessee corporation (the "Company"), and the persons or entities named as Sellers on the signature pages hereof (individually, a "Seller," and collectively, the "Sellers").

RECITALS

WHEREAS, in connection with the Membership Interest Purchase Agreement dated as of January 19, 2016 by and among the Company, Pinnacle Bank, a Tennessee state chartered bank and direct wholly owned subsidiary of the Company, BHG Founders, Inc., a Florida corporation, Bankers Healthcare Group, LLC, a Florida limited liability company, Crawford & Castro, LLC, a Delaware limited liability company and the persons named as sellers therein, as amended by that certain Amendment, dated as of the date hereof (as may be amended or modified and in effect from time to time, the "Purchase Agreement"), the Company issued in a private placement to the Sellers at the Closing those shares of the Company's common stock, $1.00 par value per share (the "Common Stock") identified on Schedule A hereto as part of the consideration to be paid pursuant to the Purchase Agreement (collectively, the "Stock Consideration").

WHEREAS, pursuant to the Purchase Agreement, the Company has filed with the SEC a registration statement on Form S-3 covering the resale as a secondary offering to be made on a continuous basis pursuant to Rule 415 of the Securities Act of all the shares of Common Stock constituting the Stock Consideration (the "Registration Statement").

WHEREAS, in connection with the issuance of the Stock Consideration and the filing of the Registration Statement, the parties desire to enter into this Agreement to grant certain rights to the Sellers and the Company with regard to the secondary offering and sale of the shares of Common Stock constituting the Stock Consideration as set forth in this Agreement.

AGREEMENT

NOW, THEREFORE, based on the foregoing, the parties, intending to be legally bound, hereby agree as follows:

ARTICLE I

DEFINITIONS

Section 1.1                          Terms Not Defined Herein.Capitalized terms used herein and not otherwise defined are defined as set forth in the Purchase Agreement.

Section 1.2                          Terms Defined Herein. For purposes of this Agreement, the following terms and variations thereof have the meanings set forth below:

"Agreement" has the meaning set forth in the preamble.

"Common Stock" has the meaning set forth in the recitals.

"Company Indemnitee" has the meaning set forth in Section 4.1(a).

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"Grace Period" has the meaning set forth in Section 2.1(d).

"Holder" means any Seller who holds Registrable Securities.

"Holder Indemnitee" has the meaning set forth in Section 4.1(a).

"Indemnified Party" has the meaning set forth in Section 4.1(c).

"Indemnifying Party" has the meaning set forth in Section 4.1(c).

"LLC Agreement" has the meaning set forth in Section 5.1.

"Purchase Agreement" has the meaning set forth in the recitals.

"Registrable Securities" means the shares of Common Stock registered under the Registration Statement and any securities issued or issuable upon any stock split, dividend or other distribution, recapitalization or similar event with respect to such securities; provided, however, that Registrable Securities shall cease to be Registrable Securities when (i) such securities have been disposed of in accordance with the Registration Statement or pursuant to Rule 144; (ii) such securities may be sold pursuant to Rule 144 without the requirement that the Company be in compliance with the current public information requirement of Rule 144 and without manner-of-sale restrictions or volume limitations; (iii) such securities cease to be outstanding; or (iv) such securities have been transferred or assigned in a private transaction in which the transferor's rights under this Agreement are not assigned in compliance with the terms of Section 5.1.

"Registration Statement" has the meaning set forth in the recitals.

"Rule 144" means Rule 144 under the Securities Act or any successor or other similar rule, regulation or interpretation of the SEC that may at any time permit the sale of Registrable Securities to the public without registration.

"Rule 405" means Rule 405 under the Securities Act or any successor other similar rule.

"Rule 415" means Rule 415 under the Securities Act or any successor or other similar rule providing for offering securities on a continuous or delayed basis.

"Seller" has the meaning set forth in the preamble.

"Selling Expenses" means all underwriting discounts, selling commissions, fees of underwriters, selling brokers, dealer managers and similar securities industry professionals and stock transfer taxes applicable to the sale of Registrable Securities and fees and disbursements of counsel for any Holder.

"Violation" has the meaning set forth in Section 4.1(a).

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ARTICLE II

REGISTRATION AND PROCEDURES

Section 2.1                          Company Obligations.

(a)            The Company shall promptly notify (which notice shall be accompanied by an instruction to suspend the use of the prospectus) each Holder of Registrable Securities covered by the Registration Statement at any time when a prospectus relating thereto is required to be delivered under the Securities Act of the happening of any event as a result of which any prospectus included in, or relating to, the Registration Statement, as then in effect, includes an untrue statement of a material fact or omits to state a material fact required to be stated therein, or necessary to make the statements therein, in light of the circumstances in which they were made, not misleading (provided that in no event shall such notice contain any material, non-public information), and, subject to Section 2.1(d), promptly prepare and file with the SEC a supplement to the related prospectus or amendment to the Registration Statement or any other required document so that, as thereafter delivered to the Holders, the prospectus will not contain an untrue statement of a material fact or omit to state any material fact required to be stated therein, or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading.

(b)            The Company shall use commercially reasonable efforts to prevent the issuance of any stop order or other suspension of effectiveness of the Registration Statement, or the suspension of the qualification of any of the Registrable Securities for sale in any jurisdiction and, if such an order or suspension is issued, to obtain the withdrawal of such order or suspension as soon as reasonably practicable and to notify the Holders of Registrable Securities covered by the Registration Statement of the issuance of such order and the resolution thereof or its receipt of actual notice of the initiation or threat of any proceeding for such purpose.

(c)            The Company shall use commercially reasonable efforts to cooperate with the Holders who hold Registrable Securities covered by the Registration Statement and, to the extent applicable, facilitate the timely preparation and delivery of certificates or book-entry shares (not bearing any restrictive legend) representing the Registrable Securities to be offered pursuant to the Registration Statement and enable such certificates or book-entry shares to be in such denominations or amounts, as the case may be, as such Holders may reasonably request and, registered in such names as such Holders may request.

(d)            Notwithstanding anything in this Agreement to the contrary, the Company may at any time delay the disclosure of material, non-public information concerning the Company or any of its Subsidiaries if the Board of Directors of the Company has determined in good faith that disclosure of such information is not in the best interests of the Company and not otherwise required by the rules and regulations of the SEC (a "Grace Period"); provided, however, that the Company shall promptly (i) provide written notice to the Holders of Registrable Securities covered by the Registration Statement of the existence of material, non-public information giving rise to a Grace Period (provided that in no event shall such notice contain any material, non-public information) and the date on which the Grace Period will begin, and (ii) provide written notice to such Holders of the date on which the Grace Period ends; provided, further, that no Grace Period shall exceed sixty (60) consecutive days and during any 12-month period such Grace Periods shall not exceed an aggregate of one hundred and twenty (120) days.  The provisions of Section 2.1(a) shall not be applicable during the period of any Grace Period.  Upon expiration of a Grace Period, the Company shall again be bound by the provisions of Section 2.1(a) with respect to the information giving rise thereto unless such material, non-public information is no longer applicable.

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(e)            The Company shall furnish to the Holders, without charge, such documents, including copies of any preliminary prospectus or final prospectus contained in the Registration Statement or any amendments or supplements thereto, as the Holders may reasonably request from time to time in order to facilitate the disposition of the Registrable Securities covered by the Registration Statement.

Section 2.2                          Current Public Information.  The Company shall use commercially reasonable efforts to make and keep public information available, as those terms are understood and defined in Rule 144 until all the Registrable Securities cease to be Registrable Securities, and so long as a Holder owns any Registrable Securities, furnish to such Holder upon request a written statement by the Company as to its satisfaction of the current public information requirements of Rule 144.

Section 2.3                          Obligations of the Sellers.

(a)            Upon receipt of written notice from the Company of the happening of any event of the kind described in Section 2.1(a) or Section 2.1(b) or written notice of any Grace Period, each Holder shall forthwith discontinue disposition of Registrable Securities until such Holder has received copies of a supplemented or amended prospectus or until such Holder is advised in writing by the Company that the use of the prospectus may be resumed or that the Grace Period has ended. If so directed by the Company, such Holder shall use its reasonable best efforts to return to the Company (at the Company's expense) all copies of the prospectus covering such Registrable Securities current at the time of receipt of such notice other than permanent file copies then in such Holders' possession.

(b)            No Holder shall use any free writing prospectus (as defined in Rule 405) in connection with the sale of Registrable Securities without the prior written consent of the Company.

ARTICLE III

 SELLING EXPENSES

All Selling Expenses incurred in connection with any registration or sale of the Registrable Securities hereunder shall be borne by the Holders of the Registrable Securities so registered in proportion the Registrable Securities owned by such Holders.

ARTICLE IV

 INDEMNIFICATION AND CONTRIBUTION

Section 4.1                          Indemnification.

(a)            To the extent permitted by law, the Company shall indemnify and hold harmless each Holder and, if a Holder is a person other than an individual, such Holder's officers, directors, employees, agents, representatives and Affiliates and each person, if any, who controls such Holder within the meaning of the Securities Act or the Exchange Act (each, a "Holder Indemnitee"), against any losses, claims, damages, or liabilities (joint or several) to which they may become subject under the Securities Act, or the Exchange Act or other federal or state law, insofar as such losses, claims, damages, or liabilities (or actions in respect thereof) arise out of or are based upon any of the following statements, omissions or violations (collectively, a "Violation"): (i) an untrue statement or alleged untrue statement of a material fact contained in the Registration Statement, including any preliminary prospectus or final prospectus contained therein or any amendments or supplements thereto or any documents incorporated therein by reference, and (ii) an omission or alleged omission to state therein a material fact required to be stated therein, or necessary to make the statements therein, in light of the circumstances in which they were made, not misleading, and the Company will pay to each such Holder Indemnitee, as accrued, any legal or other expenses reasonably incurred by them in connection with investigating or defending any such loss, claim, damage, liability, or action; provided, however, that the indemnification contained in this Section 4.1(a) shall not apply to amounts paid in settlement of any such loss, claim, damage, liability, or action if such settlement is effected without the consent of the Company (which consent shall not be unreasonably withheld), nor shall the Company be liable in any such case for any such loss, claim, damage, liability, action or expense to the extent that it arises out of or is based upon a Violation which occurs (A) in reliance upon and in conformity with written information furnished by any such Holder Indemnitee, (B) in connection with any failure of such person to deliver or cause to be delivered a prospectus made available by the Company to such Holder in a timely manner or (C) as a result of offers or sales effected by or on behalf of such Holder Indemnitee by means of a free writing prospectus (as defined in Rule 405) that was not authorized in writing by the Company.

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(b)            To the extent permitted by law, each Holder (severally and not jointly) will indemnify and hold harmless the Company and each of its officers, directors, employees, agents, representatives and Affiliates and persons, if any, who control the Company within the meaning of the Securities Act or the Exchange Act (each, a "Company Indemnitee"), against any losses, claims, damages, or liabilities (joint or several) to which any of the Company Indemnitees may become subject under the Securities Act or other federal or state law, insofar as such losses, claims, damages, or liabilities (or actions in respect thereof) arise out of or are based upon any (i) untrue statement or alleged untrue statement of a material fact regarding such Holder and provided in writing by such Holder which is contained in the Registration Statement, including any preliminary prospectus or final prospectus contained therein or any amendments or supplements thereto or (ii) the omission or alleged omission to state therein a material fact required to be stated therein, or necessary to make the statements therein not misleading, in each case to the extent (and only to the extent) that such untrue statement or alleged untrue statement or omission or alleged omission was made in the Registration Statement, preliminary or final prospectus, amendment or supplement thereto, in reliance upon and in conformity with written information furnished by such Holder and each such Holder will pay, as accrued, any legal or other expenses reasonably incurred by any Company Indemnitee pursuant to this Section 4.1(b), in connection with investigating or defending any such loss, claim, damage, liability, or action as a result of such Holder's untrue statement or omission; provided, however, that the indemnification contained in this Section 4.1(b) shall not apply to amounts paid in settlement of any such loss, claim, damage, liability or action if such settlement is effected without the consent of the Holder (which consent shall not be unreasonably withheld).  Notwithstanding the foregoing, the maximum indemnification liability of any Holder under this Section 4.1(b) is limited to an amount equal to the per share price multiplied by the number of shares of Registrable Securities sold by Holder pursuant to the Registration Statement.

(c)            Promptly after receipt by a party to this Agreement entitled to indemnity hereunder (an "Indemnified Party") under this Section 4.1 of notice of the commencement of any action (including any governmental action), such Indemnified Party will, if a claim in respect thereof is to be made against any party to this Agreement from whom indemnification may be sought under this Section 4.1 (an "Indemnifying Party"), deliver to the Indemnifying Party a written notice of the commencement thereof and the Indemnifying Party shall have the right to participate in, and, to the extent the Indemnifying Party so desires, jointly with any other Indemnifying Party similarly noticed, to assume the defense thereof with counsel reasonably satisfactory to the Indemnifying Party; provided, however, that an Indemnified Party (together with all other Indemnified Parties which may be represented without conflict by one counsel) shall have the right to retain one separate counsel, with the reasonable fees and expenses of such counsel to be paid by the Indemnifying Party, if (i) the Indemnifying Party shall have failed to assume the defense of such claim within seven (7) days after receipt of notice of the claim and to employ counsel reasonably satisfactory to such Indemnified Party, as the case may be; or (ii) in the reasonable opinion of counsel retained by the Indemnifying Party, representation of such Indemnified Party by such counsel would be inappropriate due to actual or potential differing interests between such Indemnified Party and any other party represented by such counsel in such proceeding. The Indemnified Party shall cooperate fully with the Indemnifying Party in connection with any negotiation or defense of any such action or claim by the Indemnifying Party and shall furnish to the Indemnifying Party all information reasonably available to the Indemnified Party which relates to such action or claim. The Indemnifying Party shall keep the Indemnified Party reasonably apprised of the status of the defense or any settlement negotiations with respect thereto. No Indemnifying Party shall be liable for any settlement of any action, claim or proceeding effected without its prior written consent; provided, however, that the Indemnifying Party shall not unreasonably withhold, delay or condition its consent. The failure to deliver written notice to the Indemnifying Party within a reasonable time of the commencement of any such action shall not relieve such Indemnifying Party of any liability to the Indemnified Party under this Section 4.1, except to the extent such failure to give notice has a material adverse effect on the ability of the Indemnifying Party to defend such action.

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Section 4.2                          Contribution.  If the indemnification provided for in Section 4.1 is held by a court of competent jurisdiction to be unavailable to an Indemnified Party with respect to any loss, liability, claim, damage, or expense referred to therein, then the Indemnifying Party, in lieu of indemnifying such Indemnified Party hereunder, shall contribute to the amount paid or payable by such Indemnified Party as a result of such loss, liability, claim, damage, or expense in such proportion as is appropriate to reflect the relative fault of the Indemnifying Party on the one hand and of the Indemnified Party on the other in connection with the statements or omissions that resulted in such loss, liability, claim, damage, or expense as well as any other relevant equitable considerations. The relative fault of the Indemnifying Party and of the Indemnified Party shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission to state a material fact relates to information supplied by the Indemnifying Party or by the Indemnified Party and the parties' relative intent, knowledge, access to information, and opportunity to correct or prevent such statement or omission. Notwithstanding the foregoing, the amount any Holder will be obligated to contribute pursuant to this Section 4.2 will be limited to an amount equal to the per share price multiplied by the number of shares of Registrable Securities sold by Holder pursuant to the Registration Statement (less the aggregate amount of any damages which such Holder has otherwise been required to pay in respect of such loss, liability, claim, damage, or expense or any substantially similar loss, liability, claim, damage, or expense arising from the sale of such Registrable Securities). No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) will be entitled to contribution hereunder from any person who was not guilty of such fraudulent misrepresentation.

ARTICLE V

 GENERAL PROVISIONS

 

        Section 5.1                          Assignment; No Third Party Beneficiaries.  This Agreement shall inure to the benefit of and be binding upon the successors and permitted assigns of each of the parties to this Agreement.  Nothing in this Agreement will be construed to give any party other than the parties to this Agreement or their respective successors and assigns any legal or equitable right under or with respect to this Agreement or any provision of this Agreement, except such rights as will inure to a successor or permitted assignee pursuant to this Section 5.1.  The Company may not assign any of its rights or delegate any of its obligations under this Agreement (except in connection with the sale of all or substantially all of the assets of or any business combination transaction involving the Company) without the prior written consent of Holders of a majority of the Registrable Securities then outstanding.  Except for an assignment to a Permitted Transferee (as defined in the Amended and Restated Limited Liability Company Agreement of Bankers Healthcare Group, LLC, a Florida limited liability company, dated as of the date hereof (the "LLC Agreement"), a Holder may not assign any of its rights or delegate any of its obligations under this Agreement without the prior written consent of the Company.

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Section 5.2                          Notices.  All notices, consents, waivers, and other communications under this Agreement must be in writing and will be deemed to have been duly given when (a) delivered by hand (with written confirmation of receipt), (b) sent by facsimile with confirmation of transmission by the transmitting equipment, (c) received by the addressee, if sent by certified mail, return receipt requested, or (d) received by the addressee, if sent by a nationally recognized overnight delivery service, return receipt requested, in each case, to the appropriate address or facsimile number set forth below (or to such other addresses or facsimile numbers as a party may designate by notice to the other parties):

If to the Sellers:

 

BHG Founders, Inc.

201 Solar Street

Syracuse, NY 13204

Facsimile:(315) 637-4686

 

Albert Crawford

201 Solar Street

Syracuse, NY 13204

Facsimile:(315) 637-4686

 

Eric Castro and/or Barbara Castro

10234 W. State Road 84

Davie, FL 33324

Facsimile: (954) 384-9609

 

and

 

Robert Castro and/or Sofia Castro

10234 W. State Road 84

Davie, FL 33324

Facsimile:  (954) 332-6400

 

with a copy to:

 

Moore &Van Allen PLLC

100 North Tryon Street, Suite 4700

Charlotte, North Carolina 28202

Attention:          Hal A. Levinson

Brian D. Mesibov

Facsimile:             (704) 378-2050

(704) 378-1986

 

If to the Company:

 

Pinnacle Financial Partners, Inc.150

Third Avenue South, Suite 900

Nashville, Tennessee 37201

Attention:   Harold R. Carpenter

Fax No.:                (615) 744-3842

 

with a copy to:

Bass, Berry & Sims PLC

150 Third Avenue South, Suite 2800

Nashville, Tennessee 37201

Attention:          D. Scott Holley

Fax No.:               (615) 742-2813

 

Section 5.3                          Entire Agreement; Modification or Waiver.  This Agreement, including Schedule A hereto, constitutes the entire agreement among the parties and supersedes all prior agreements (other than the Purchase Agreement and the LLC Agreement), whether written or oral, between the parties with respect to the subject matter hereof and thereof.  This Agreement may not be amended except by a written agreement signed by the Company and the Holders of a majority of the Registrable Securities then outstanding.  No claim or right arising out of this Agreement can be discharged by one party, in whole or in part, by a waiver or renunciation of the claim or right unless in writing signed by, in the case of any waiver requested by the Company, the Holders of a majority of the Registrable Securities then outstanding, and in the case of any waiver requested by the Holders of a majority of the Registrable Securities then outstanding, the Company.  Any amendment or waiver effected in accordance with this paragraph shall be binding upon each Holder of any the Registrable Securities then outstanding, each future Holder of all such the Registrable Securities, and the Company.  No such amendment shall be effective to the extent that it applies to less than all of the Holders of the Registrable Securities then outstanding.

Section 5.4                          Severability.  If any provision of this Agreement is held to be invalid or unenforceable for any reason, such provision shall be ineffective to the extent of such invalidity or unenforceability; provided, however, that the remaining provisions will continue in full force and effect without being impaired or invalidated in any way.

Section 5.5                          Headings; Construction. The headings of Articles and Sections in this Agreement are provided for convenience only and will not affect its construction or interpretation. All words used in this Agreement will be construed to be of such gender or number as the context requires. The word "including" shall be read as "including but not limited to" and otherwise shall be considered illustrative and non-limiting. The language used in this Agreement will be construed, in all cases, according to its fair meaning, and not for or against any party hereto. The parties acknowledge that each party has reviewed this Agreement and that rules of construction to the effect that any ambiguities are to be resolved against the drafting party, will not be available in the interpretation of this Agreement.

Section 5.6                          Governing Law. This Agreement, and any claims that arise out of or result from this Agreement, will be governed by and construed under the laws of the State of Delaware without regard to any conflicts of laws principles that would require the application of any other law.

Section 5.7                          Execution of Agreement; Counterparts. This Agreement may be executed in any number of counterparts, each of which will be deemed to be an original copy of this Agreement and all of which, when taken together, will be deemed to constitute one and the same agreement. The exchange of copies of this Agreement and of signature pages by facsimile, or by .pdf or similar imaging transmission, will constitute effective execution and delivery of this Agreement as to the parties and may be used in lieu of the original Agreement for all purposes.  Signatures of the parties transmitted by facsimile, or by .pdf or similar imaging transmission, will be deemed to be their original signatures for any purpose whatsoever.

Section 5.8                          Waiver of Jury Trial.  THE PARTIES HEREBY WAIVE ANY RIGHT TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING ARISING OUT OF OR IN ANY WAY PERTAINING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY, WHETHER NOW OR HEREAFTER ARISING, AND WHETHER SOUNDING IN CONTRACT, TORT, OR OTHERWISE.  ANY PARTY MAY FILE A COPY OF THIS SECTION 5.8 WITH ANY COURT AS WRITTEN EVIDENCE OF THE KNOWING, VOLUNTARY AND BARGAINED AGREEMENT BETWEEN THE PARTIES TO IRREVOCABLY WAIVE TRIAL BY JURY, AND THAT ANY PROCEEDING OR ACTION WHATSOEVER BETWEEN THE PARTIES RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY WILL INSTEAD BE TRIED IN A COURT OF COMPETENT JURISDICTION BY A JUDGE SITTING WITHOUT A JURY.

(Next Page is Signature Page)

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  IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above.

THE COMPANY:

PINNACLE FINANCIAL PARTNERS, INC.

By: /s/ Hugh M. Queener

Name: Hugh M. Queener

Its:    EVP & Chief Administrative Officer

SELLERS:

BHG FOUNDERS, INC.

By: /s/ Albert Crawford

Name: Albert Crawford

Its:    Chief Executive Officer

/s/ Albert Crawford                                                                                          

Albert Crawford

/s/ Barbara Castro                                                                                          

Barbara Castro

/s/ Sofia Castro                                                                            

Sofia Castro

/s/ Eric Castro                                                                            

Eric Castro

/s/ Robert Castro                                                                                          

Robert Castro

SCHEDULE A

 

	
Stockholder

	
Number of Shares of Common Stock

	
BHG Founders, Inc.

	
860,470ex10-1.htm

Exhibit 10.1

 

SHARE EXCHANGE AGREEMENT

 

BY AND AMONG

 

SPIRAL ENERGY TECH., INC.,

 

EXACTUS BIOSOLUTIONS INC.,

 

and

 

THE STOCKHOLDERS OF EXACTUS BIOSOLUTIONS INC.

AS SIGNATORIES HERETO

 

Dated as of February 29, 2016

 

  

 

  

SHARE EXCHANGE AGREEMENT

 

This SHARE EXCHANGE AGREEMENT (this "Agreement") is entered into as of February 29, 2016, by and among SPIRAL ENERGY TECH., INC., a Nevada corporation ("Purchaser"), EXACTUS BIOSOLUTIONS INC., a Delaware corporation, ("Exactus") and, the stockholders of Exactus signatory hereto (each individually, a “Stockholder” and collectively, the “Stockholders”).

 

RECITALS

 

WHEREAS, Purchaser and Exactus have each agreed to the acquisition by Purchaser of all of equitable and other legal rights, title and interests in and to the issued and outstanding capital stock  of Exactus pursuant to a voluntary share exchange transaction (the "Share Exchange"), and the other transactions provided herein and have adopted this Agreement, in each case after determining that the Share Exchange and the consummation of the other transactions contemplated herein are advisable, fair to, and in the best interests of the Purchaser, Exactus and, their respective stockholders;

 

WHEREAS, in furtherance thereof, the Board of Directors of Purchaser has approved the Share Exchange in accordance with the applicable provisions of the Nevada Revised Statutes (“NRS”) and upon the terms and subject to the conditions set forth herein;

 

WHEREAS, in furtherance thereof, the Board of Directors and the Stockholders of Exactus have each approved the Share Exchange in accordance with the applicable provisions of the laws of the State of Delaware and upon the terms and subject to the conditions set forth herein; and

 

WHEREAS, for United States federal income tax purposes, the parties intend that the Share Exchange shall constitute a tax-free reorganization within the meaning of Sections 368 and 1032 of the Code.

 

NOW, THEREFORE, in consideration of the premises, and the mutual covenants and agreements contained herein, the parties do hereby agree as follows:

  

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ARTICLE I.

 

DEFINITIONS

 

1.1           Defined Terms.

 

When used in this Agreement, the following terms shall have the respective meanings specified below.

 

(a)           "Agreement" means this Share Exchange Agreement.

 

(b)           "Applicable Law" or "Applicable Laws" means any and all laws, ordinances, constitutions, regulations, statutes, treaties, rules, codes, licenses, certificates, franchises, permits, principles of common law, requirements and Orders adopted, enacted, implemented, promulgated, issued, entered or deemed applicable by or under the authority of any Governmental Body having jurisdiction over a specified Person or any of such Person's properties or assets.

 

(c)           "Best Efforts" means the efforts that a prudent Person desirous of achieving a result would use in similar circumstances to achieve that result as expeditiously as possible, provided, however, that a Person required to use Best Efforts under this Agreement will not be thereby required to take actions that would result in a Material Adverse Effect in the benefits to such Person of this Agreement and the Share Exchange.

 

(d)           "Breach" means any breach of, or any inaccuracy in, any representation or warranty or any breach of, or failure to perform or comply with, any covenant or obligation, in or of this Agreement or any other Contract.

 

(e)           "Business" means the business presently conducted by Exactus.

 

(f)           "Business Day" means any day other than (a) Saturday or Sunday or (b) any other day on which banks in New York City, NY are permitted or required to be closed.

 

(g)           “DGCL” means the Delaware General Corporation Law, as amended from time to time, and the rules and regulations promulgated thereunder.  Section references to the DGCL are to the DGCL as in effect at the date of this Agreement.

 

(h)           "Closing" shall mean the completion of the Share Exchange and the consummation of the transactions set forth herein.

 

(i)           "Closing Date" shall mean the date on which the Closing is completed.

 

(j)           "Code" shall mean the Internal Revenue Code of 1986, as amended.

  

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(k)           "Consent" means any approval, consent, license, permits, ratification, waiver or other authorization.

 

(l)           "Contract" means any agreement, contract, lease, license, consensual obligation, promise, undertaking, understanding, commitment, arrangement, instrument or document (whether written or oral and whether express or implied), whether or not legally binding.

 

(m)           ""Encumbrance" means and includes:

 

(i)           with respect to any personal property, 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 or lease or use agreement in the nature thereof, interest or other right or claim of third parties, whether voluntarily incurred or arising by operation of law, and including any agreement to grant or submit to any of the foregoing in the future; and

 

(ii)           with respect to any Real Property (whether and including owned real estate or Real Estate subject to a Real Property Lease), any mortgage, lien, easement, interest, right-of-way, condemnation or eminent domain proceeding, encroachment, any building, use or other form of restriction, encumbrance or other claim (including adverse or prescriptive) or right of Third Parties (including Governmental Bodies), any lease or sublease, boundary dispute, and agreements with respect to any real property including: purchase, sale, right of first refusal, option, construction, building or property service, maintenance, property management, conditional or contingent sale, use or occupancy, franchise or concession, whether voluntarily incurred or arising by operation of law, and including any agreement to grant or submit to any of the foregoing in the future.

 

(n)           "Governing Documents" means with respect to any particular entity, the articles or certificate of incorporation and the bylaws (or equivalent documents for entities of foreign jurisdictions); all equity holders' agreements, voting agreements, voting trust agreements, joint venture agreements, registration rights agreements or other agreements or documents relating to the organization, management or operation of any Person or relating to the rights, duties and obligations of the equity holders of any Person; and any amendment or supplement to any of the foregoing.

 

(o)           "Governmental Body" means any instrumentality, subdivision, court, administrative agency, commission, official or other authority of the United States or any other country or any state, province, prefect, municipality, locality or other government or political subdivision thereof, or any quasi-governmental or private body exercising any regulatory, taxing, importing or other governmental or quasi-governmental authority.

 

  

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(p)             "Knowledge" means actual knowledge without independent investigation.

 

(q)             "Material Adverse Effect" or "Material Adverse Change" means:

 

(i)           with respect to Exactus or the Stockholders, an effect that is or would reasonably be expected to be materially adverse (A) to the Business, results of operations or financial condition of Exactus; or (B) to Exactus’ or the Stockholders’ ability to perform any of their respective obligations under this Agreement or to consummate the transactions contemplated in this Agreement; or

 

(ii)           with respect to the Purchaser, an effect that is or would reasonably be expected to be materially adverse (A) to the business, results of operation or financial condition of the Purchaser considered as a whole; or (B) to the ability of the Purchaser to perform any of their respective obligations under this Agreement or to consummate the transactions contemplated in the Agreement;

 

provided, however, that in determining whether a Material Adverse Effect has occurred there shall be excluded any effect on the referenced party the cause of which is: (A) general changes in the financial markets or in the global or United States economy so long as any such change does not materially effect the referenced party to a materially different extent than other similarly situated Persons, (B) any action or omission of the parties permitted or required by the Agreement, and (C) the announcement of the transactions contemplated hereby.

 

(r)              "NRS" shall mean the Nevada Revised Statutes, as amended.

 

(s)              "Order" means any writ, directive, order, injunction, judgment, decree, ruling, assessment or arbitration award of any Governmental Body or arbitrator.

 

(t)              "Ordinary Course of Business" means an action taken by a Person will be deemed to have been taken in the Ordinary Course of Business only if that action: (i) is consistent in nature, scope and magnitude with the past practices of such Person and is taken in the ordinary course of the normal, day-to-day operations of such Person; (ii) does not require authorization by the board of directors or shareholders of such Person (or by any Person or group of Persons exercising similar authority) and does not require any other separate or special authorization of any nature; and (iii) is similar in nature, scope and magnitude to actions customarily taken, without any separate or special authorization, in the ordinary course of the normal, day-to-day operations of other Persons that are in the same line of business as such Person.

 

(u)             "Party" or "Parties" means Exactus, the Stockholders and/or the Purchaser.

 

(v)             "Person" means and includes an individual, a partnership, a joint venture, a corporation, a limited liability company, a limited liability partnership, a trust, an incor­porated organization or a Governmental Body.

 

(w)             "Proceeding" means any action, arbitration, audit, hearing, investigation, litigation or suit (whether civil, criminal, administrative, judicial or investigative, whether formal or informal, whether public or private) commenced, brought, conducted or heard by or before, or otherwise involving, any Governmental Body or arbitrator.

 

(x)              "Purchaser" means Spiral Energy Tech., Inc.

 

(y)             "Purchaser Business" means Purchaser's business as presently conducted.

 

(z)              "Purchaser Preferred Stock" means the Series B-1 Preferred Stock, par value $.0001 per share, of Purchaser.

 

(aa)            "Real Property" means any Land and Improvements and all privileges, rights, easements, hereditaments and appurtenances belonging to or for the benefit of any Land.

 

(bb)           "Real Property Lease" means any lease, rental agreement or rights to use any Land or Real Property.

 

(cc)            "Representative" means with respect to a particular Person, any director, officer, manager, employee, agent, consultant, advisor, accountant, financial advisor, legal counsel or other Representative of that Person.

 

(dd)           "SEC" means the United States Securities and Exchange Commission.

 

(ee)            "Securities Act" means the Securities Act of 1933, as amended.

 

(ff)             "Security Interest" means any mortgage, pledge, security interest, Encumbrance, charge, claim, or other lien, other than:  (a) mechanic's, materialmen's and similar liens; (b) liens for Taxes not yet due and payable or for Taxes that the taxpayer is contesting in good faith through appropriate Proceedings; (c) liens arising under worker's compensation, unemployment insurance, social security, retirement and similar legislation; (d) liens arising in connection with sales of foreign receivables; (e) liens on goods in transit incurred pursuant to documentary letters of credit; (f) purchase money liens and liens securing rental payments under capital lease arrangements; and (g) other liens arising in the Ordinary Course of Business and not incurred in connection with the borrowing of money.

 

(gg)           "Share Exchange" has the meaning set forth in the preamble.

 

(hh)           "Shares" has the meaning set forth in Section 2.1

 

  

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(ii)             "Subsidiary" means with respect to any Person (the "Owner"), any corporation or other Person of which securities or other interests having the power to elect a majority of that corporation's or other Person's board of directors or similar governing body, or otherwise having the power to direct the business and policies of that corporation or other Person (other than securities or other interests having such power only upon the happening of a contingency that has not occurred), are held by the Owner or one or more of its Subsidiaries.

 

(jj)             "Exactus" has the meaning set forth in the preamble.

 

(kk)           "Exactus Board" has the meaning set forth in Section 4.3.

 

(ll)             "Exactus Shareholders" has the meaning set forth in Section 2.1.

 

(mm)         "Tax" or "Taxes" means all taxes, assessments, charges, duties, fees, levies or other similar governmental charges, including all U.S. and non-U.S. federal, state, local and other income, franchise, profits, capital gains, capital stock, transfer, sales, use, occupation, property, excise, severance, windfall profits, stamp, license, payroll, withholding and other taxes, assessments, charges, duties, fees, levies or other similar governmental charges (whether payable directly or by withholding and whether or not requiring the filing of a Tax Return), all estimated taxes, deficiency assessments, additions to tax, penalties and interest and shall include any liability for such amounts as a result either of being a member of a combined, consolidated, unitary or affiliated group or of a contractual obligation to indemnify any Person or other entity.

 

(nn)           "Tax Return" means any return, declaration, report, claim for refund, or information return or statement relating to Taxes, including any schedule or attachment thereto, and including any amendment thereof.

 

1.2           Schedules and Exhibits.

 

The Schedules and Exhibits to this Agreement are incorporated into and form an integral part of this Agreement.  If an Exhibit is a form of agreement, such agreement, when executed and delivered by the parties thereto, shall constitute a document independent of this Agreement.

  

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ARTICLE II.

 

THE SHARE EXCHANGE

 

2.1           The Share Exchange.

 

Upon the terms and subject to the conditions set forth in this Agreement and in accordance with the NRS, at the Closing, the parties shall cause the Share Exchange to be consummated by taking all appropriate actions to ensure that all equitable and legal rights, title and interests in and to the issued and outstanding capital stock of Exactus is assigned, delivered and transferred to the Purchaser, in exchange for the issuance of an aggregate of 32,000,000 shares of Purchaser’s Series B-1 Preferred Stock (the "Shares") to the shareholders of Exactus listed on Schedule 2.1 (the “Exactus Shareholders”).

 

2.2           Tax Free Reorganization.

 

The Parties each hereby agree to use their Best Efforts and to cooperate with each other to cause the Share Exchange to be a tax-free reorganization within the meaning of Sections 368 and 1032 of the Code.

 

2.3           Dissenting Shares.  Notwithstanding anything in this Agreement to the contrary and subject to Section 262 of the DGCL, shares of Exactus Common Stock outstanding immediately prior to the Closing and held by a holder who has not voted in favor of the Share Exchange and who has not consented thereto in writing and who has delivered a written demand for appraisal of such shares in accordance with Section 262 of the DGCL (the “Dissenting Shares”) shall not be converted into the right to receive shares of the Purchaser Preferred Stock, unless and until such holder fails to perfect or effectively withdraws or otherwise loses such holder’s right to appraisal and payment under the DGCL.  Such holder shall be entitled to receive payment of the appraised value of such shares of Exactus Common Stock in accordance with the provisions of the DGCL, provided that such holder complies with the provisions of Section 262 of the DGCL.  If, after the Closing Time, any such holder fails to perfect or effectively withdraws or otherwise loses such holder’s right to appraisal, such Dissenting Shares shall thereupon be treated as if they had been converted as of the Closing Date into the right to receive the shares of Purchaser Preferred Stock pursuant to Section 2.1.  Exactus shall give Purchaser prompt notice of any demands received by Exactus for appraisal of shares of Exactus, and shall have the right to participate in all negotiations and proceedings with respect to such demands.

 

2.4           Closing.

 

The Closing will occur via e-mail and facsimile on such date and time to be agreed upon by the parties (the "Closing Date"), following satisfaction or waiver of the conditions set forth in Article VII.

 

  

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2.5           Reorganization of the Board of Directors and Management.

 

(a)          Purchaser shall take such action as may be necessary to appoint the individuals set forth on Schedule 2.5 as a directors of the Purchaser, effective as of the Closing and until their  respective successors have been duly elected or appointed and qualified or until their earlier death, resignation or removal in accordance with Purchaser’s Articles of Incorporation and By-laws.

 

(b)          Those individuals set forth on Schedule 2.5 shall, as of the Closing, be appointed as the officers of the Purchaser until their successors have been duly elected or appointed and qualified or until their earlier death, resignation or removal in accordance with the Purchaser's Certificate of Incorporation and By-laws.

 

(c)          If at any time after the Closing, any party shall consider that any further deeds, assignments, conveyances, agreements, documents, instruments or assurances in law or any other things are necessary or desirable to vest, perfect, confirm or record in the Purchaser the title to any property, rights, privileges, powers and franchises of, and equity in, Exactus by reason of, or as a result of, the Share Exchange, or otherwise to carry out the provisions of this Agreement, the remaining parties, as applicable, shall execute and deliver, upon request, any instruments or assurances, and do all other things necessary or proper to vest, perfect, confirm or record title to such property, rights, privileges, powers, franchises, and equity in the Purchaser, and otherwise to give effect to the provisions of this Agreement and the Share Exchange.

 

 

ARTICLE III.

 

COVENANTS, REPRESENTATIONS AND

WARRANTIES OF THE STOCKHOLDERS

 

3.1           Investment Purpose.

 

The Stockholders acknowledge and agree that they are acquiring the Shares for investment purposes and will not offer, sell or otherwise transfer, pledge or hypothecate any of the Shares issued to them (other than pursuant to an effective Registration Statement under the Securities Act) directly or indirectly unless:

 

(a)           The sale is to Purchaser;

 

(b)           the sale is made pursuant to the exemption from registration under the Securities Act, provided by Rule 144 thereunder; or

 

  

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(c)           the Shares are sold in a transaction that does not require registration under the Securities Act, or any applicable United States state laws and regulations governing the offer and sale of securities, and the vendor has furnished to Purchaser an opinion of counsel to that effect or such other written opinion as may be reasonably required by Purchaser.

 

3.2           Share Legend.

 

The Stockholders acknowledge and agree that the certificates representing the Shares shall bear the following legend:

 

THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR INVESTMENT AND HAVE NOT BEEN REGISTERED WITH THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER ANY APPLICABLE STATE SECURITIES LAWS.  WITHOUT SUCH REGISTRATION, SUCH SECURITIES MAY NOT BE SOLD OR OTHERWISE TRANSFERRED AT ANY TIME WHATSOEVER UNLESS IN THE OPINION OF COUNSEL SATISFACTORY TO THE COMPANY REGISTRATION IS NOT REQUIRED FOR SUCH TRANSFER AND THAT SUCH TRANSFER WILL NOT BE IN VIOLATION OF THE APPLICABLE FEDERAL AND STATE SECURITIES LAWS OR ANY RULE OR REGULATION PROMULGATED THEREUNDER.

 

3.3           Representations and Warranties.

 

The Stockholders represent and warrant that:

 

(a)           the Stockholders acknowledge that the shares being issued hereunder are subject to significant restrictions on transfer as imposed by state and federal securities laws, including but not limited to a minimum holding period of at least six (6) months; and

 

(b)           the Stockholders are not aware of any advertisement of any of the shares being issued hereunder.

 

ARTICLE IV.

 

REPRESENTATIONS AND WARRANTIES OF EXACTUS

 

As a material inducement for Purchaser to enter into this Agreement and to consummate the transactions contemplated hereby, Exactus makes the following representations and warranties as of the date hereof and as of the Closing Date, each of which is relied upon by Purchaser regardless of any investigation made or information obtained by Purchaser (unless and to the extent specifically and expressly waived in writing by Purchaser on or before the Closing Date):

 

  

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4.1           Organization and Good Standing.

 

(a)           Exactus is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware.  Exactus is duly qualified to do business in each jurisdiction in which it conducts business activities and is in good standing under the laws of each jurisdiction in which either the ownership or use of the properties owned or used by it, or the nature of the activities conducted by it, requires such qualification and the failure to be so qualified would have a Material Adverse Effect on Exactus.

 

(b)           Exactus has no Subsidiaries and does not own any shares of capital stock or other securities of any other Person.

 

4.2           Capitalization of Exactus.

 

The entire authorized capital stock of Exactus consists of 5,000 shares of common stock, par value $1.00 per share.  All issued and outstanding shares of common stock have been duly authorized, are validly issued, fully paid and nonassessable.  There are no outstanding or authorized options, warrants, rights, contracts, calls, puts, rights to subscribe, conversion rights or other agreements or commitments to which Exactus is a party or which are binding upon Exactus providing for the issuance, disposition or acquisition of any of its capital stock, nor any outstanding or authorized stock appreciation, phantom stock or similar rights with respect to Exactus.

 

4.3           Authorization of Transaction.

 

(a)           Exactus has full power and authority to execute and deliver this Agreement and to perform its obligations hereunder. On the Closing Date, this Agreement shall be duly and validly authorized by all necessary action on the part of Exactus in accordance with Applicable Laws and Exactus' Governing Documents.  This Agreement constitutes the valid and legally binding obligation of Exactus, enforceable in accordance with its terms and conditions.  The Board of Directors of Exactus (the "Exactus Board") has duly and validly authorized the execution and delivery of this Agreement and approved the consummation of the transactions contemplated hereby.

 

(b)            The shareholders of Exactus holding not less than a majority of the issued and outstanding capital stock of Exactus have by written consent approved the consummation of the transactions contemplated hereby.

 

(c)           Exactus has taken all corporate actions required to be taken by the Exactus for the consummation of the Share Exchange.

  

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4.4           Noncontravention.

 

Neither the execution nor delivery of this Agreement, nor consummation of the Share Exchange, by Exactus will:

 

(a)           violate any Applicable Law, Order, stipulation, charge or other restriction of any Governmental Body to which Exactus is subject or any provision of its Governing Documents; or

 

(b)           conflict with, result in a Breach of, constitute a default under, result in the acceleration of, create in any Person the right to accelerate, terminate, modify or cancel, or require any notice under any contract, lease, sublease, license, sublicense, franchise, permit, indenture, agreement or mortgage for borrowed money, instrument of indebtedness, Security Interest or other arrangement to which Exactus is a party or by which it is bound or to which any of its assets is subject (or result in the imposition of any Security Interest upon any of its assets), except where the violation, conflict, Breach, default, acceleration, termination, modification, cancellation, failure to give notice, or Security Interest would not have a Material Adverse Effect on the financial condition of Exactus or on the ability of the Parties to consummate the Share Exchange.

 

ARTICLE V.

 

REPRESENTATIONS AND WARRANTEES OF PURCHASER

 

As a material inducement for Exactus to enter into this Agreement and to consummate the transactions contemplated hereby, Purchaser hereby makes the following representations and warranties as of the date hereof and as of the Closing Date, each of which is relied upon by Exactus regardless of any investigation made or information obtained by Exactus (unless and to the extent specifically and expressly waived in writing by Exactus on or before the Closing Date):

 

5.1           Organization and Good Standing.

 

(a)           Purchaser is a corporation duly organized, validly existing and in good standing under the laws of State of Nevada. Purchaser is duly qualified to do business as a foreign corporation and is in good standing under the laws of each state or other jurisdiction in which either the ownership or use of the properties owned or used by it, or the nature of the activities conducted by it, requires such qualification and the failure to be so qualified would have a Material Adverse Effect on Purchaser.

 

(b)           Purchaser has no Subsidiary and does not own any shares of capital stock or other securities of any other Person.

 

  

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5.2           Authorization of Transaction.

 

Purchaser has the corporate power to execute, deliver and perform this Agreement, the Related Agreements, and, subject to the satisfaction of the conditions precedent set forth herein, has taken all action required by law, its Governing Documents or otherwise, to authorize the execution, delivery, and performance  of this Agreement and such related documents.  The execution and delivery of this Agreement has been approved by the Board of Directors of Purchaser.  This Agreement is a valid obligation of Purchaser and is legally binding on Purchaser in accordance with its terms.

 

5.3           Capitalization of Purchaser.

 

The entire authorized capital stock of Purchaser consists of 200,000,000 shares of common stock having a par value of $0.0001 per share, and 50,000,000 shares of preferred stock, par value $0.0001 per share. All issued and outstanding shares of the Purchaser’s capital stock have been duly authorized, are validly issued, fully paid and nonassessable.  There are no outstanding or authorized options, warrants, rights, contracts, calls, puts, rights to subscribe, conversion rights or other agreements or commitments to which Purchaser is a party or which are binding upon Purchaser providing for the issuance, disposition or acquisition of any of its capital stock, nor any outstanding or authorized stock appreciation, phantom stock or similar rights with respect to Purchaser.

 

5.4           Noncontravention.

 

Neither the execution nor delivery of this Agreement, nor consummation of the Share Exchange, will:

 

(a)           violate any Applicable Law, Order, stipulation, charge or other restriction of any Governmental Body to which Purchaser is subject or any provision of its Governing Documents; or

 

(b)           conflict with, result in a Breach of, constitute a default under, result in the acceleration of, create in any Person the right to accelerate, terminate, modify or cancel, or require any notice under any contract, lease, sublease, license, sublicense, franchise, permit, indenture, agreement or mortgage for borrowed money, instrument of indebtedness, Security Interest, or other arrangement to which Purchaser is a party or by which it is bound or to which any of its assets is subject (or result in the imposition of any Security Interest upon any of its assets), except where the violation, conflict, Breach, default, acceleration, termination, modification, cancellation, failure to give notice, or Security Interest would not have a Material Adverse Effect on the financial condition of Purchaser or on the ability of the Parties to consummate the Share Exchange.

 

  

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ARTICLE VI.

 

ACCESS TO INFORMATION AND DOCUMENTS

 

6.1           Access to Information.

 

Between the date hereof and the Closing Date, each Party will give to the other and its counsel, accountants and other Representatives full access to all the properties, documents, contracts, personnel files and other records and shall furnish copies of such documents and with such information with respect to its affairs as may from time to time be reasonably requested.  Each Party will disclose to the other and make available to such Party and its Representatives all books, contracts, accounts, personnel records, letters of intent, papers, records, communications with regulatory authorities and other documents relating to the business and operations of Exactus or Purchaser, as the case may be.  In addition, Exactus shall make available to Purchaser all such banking, investment and financial information as shall be necessary to allow for the efficient integration of Exactus's banking, investment and financial arrangements with those of Purchaser at the Closing.  Access of Purchaser pursuant to the foregoing shall be granted at a reasonable time and upon reasonable notice.

 

6.2           Effect of Access.

 

(a)           Nothing contained in this Article V., shall be deemed to create any duty or responsibility on the part of either Party to investigate or evaluate the value, validity or enforceability of any Contract or other asset included in the assets of the other Party.

 

(b)           With respect to matters as to which any Party has made express representations or warranties herein, the Parties shall be entitled to rely upon such express representations and warranties irrespective of any investigations made by such Parties, except to the extent that such investigations result in actual Knowledge of the inaccuracy or falsehood of particular representations and warranties.

 

ARTICLE VII.

 

COVENANTS

 

7.1           Preservation of Business.

 

(a)           Prior to the Closing or the termination of this Agreement, Exactus will use its Best Efforts to preserve the Business, to keep available to Purchaser the services of the present employees of Exactus, and to preserve for Purchaser the goodwill of the suppliers, customers and others having business relations with Exactus.  Exactus shall conduct its Business only in the Ordinary Course of Business, including, without limitation, its policies and practices relating to the collection of accounts receivable and the payment of accounts payable and other liabilities, and not introduce any new methods of management, operations or accounting, without Purchaser’s prior written consent (which shall not be unreasonably withheld); maintain its assets in as good working order and condition as at present, ordinary wear and tear excepted; perform all material obligations under material agreements and leases relating to or affecting it, and keep in full force and effect present insurance policies.

  

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(b)           Prior to the Closing or the termination of this Agreement, Purchaser will use its Best Efforts to preserve the Purchaser Business, to keep available to Purchaser the services of the present employees of Purchaser, and to preserve for Purchaser the goodwill of the suppliers, customers and others having business relations with Purchaser.  Purchaser shall conduct the Purchaser Business only in the Ordinary Course of Business, including, without limitation, its policies and practices relating to the collection of accounts receivable and the payment of accounts payable and other liabilities, and not introduce any new methods of management, operations or accounting, without the prior written consent of Exactus (which shall not be unreasonably withheld); maintain its assets in as good working order and condition as at present, ordinary wear and tear excepted; perform all material obligations under material agreements and leases relating to or affecting it, and keep in full force and effect present insurance policies.

 

7.2           Current Information.

 

(a)           During the period from the date of this Agreement to the Closing, each Party hereto shall promptly notify each other Party of any (i) significant change in the normal course of business or operations of its business, (ii) Proceeding (or communications indicating that the same may be contemplated), or the institution or threat or settlement of Proceedings, in each case involving such Party, the outcome of which, if adversely determined, could reasonably be expected to have a Material Adverse Effect on the Party, taken as a whole or (iii) event which such Party reasonably believes could be expected to have a Material Adverse Effect on the ability of any Party  to consummate the Share Exchange.

 

(b)           During the period from the date of this Agreement to the Closing, Purchaser shall promptly notify Exactus of any correspondence received from the SEC and shall deliver a copy of such correspondence to Exactus within one (1) Business Day of receipt.

 

ARTICLE VIII.

 

CONDITIONS TO CLOSING

 

8.1           Mutual Conditions.

 

The respective obligations of each Party to effect the Share Exchange shall be subject to the satisfaction, at or prior to the Closing Date, of the following conditions (any of which may be waived in writing by Purchaser and Exactus:

 

(a)           None of Purchaser, or Exactus shall be subject to any Order by a court of competent jurisdiction which (i) prevents or materially delays the consummation of the Share Exchange or (ii) would impose any material limitation on the ability of Purchaser effectively to exercise full rights of ownership of the common stock of Exactus or any material portion of the assets or Business, taken as a whole.

 

(b)           No statute, rule or regulation, shall have been enacted by any Governmental Body that makes the consummation of the Share Exchange illegal.

  

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8.2           Conditions to the Obligations of Purchaser to Close.

 

The obligations of Purchaser under this Agreement are subject to the satisfaction, at or before the Closing, of each of the following conditions:

 

(a)           The representations and warranties of Exactus contained herein that are qualified as to materiality shall be true in all respects on and as of the Closing Date with the same force and effect as though made on and as of such date, and each of the representations and warranties of Exactus that are not so qualified shall be true in all material respects on and as of the Closing Date.

 

(b)           Exactus shall have performed and complied in all material respects with all covenants, agreements, obligations and conditions required by this Agreement to be performed or complied with by Exactus at or prior to the Closing.

 

(c)           There shall not be threatened, instituted or pending any Proceeding by or before any court or Govern­mental Body requesting or looking toward an Order that (a) restrains or prohibits the consummation of the Share Exchange, (b) could have a Material Adverse Effect on Purchaser's ability to exercise control over or manage the Exactus after the Closing or (c) could have a Material Adverse Effect on Exactus.

 

(d)           On the Closing Date, there shall be no effective Order issued by a court of competent jurisdiction restraining or prohibiting the consummation of the Share Exchange.

 

8.3           Conditions to the Obligations of Exactus.

 

The obligations of Exactus and the Exactus Shareholders under this Agreement are subject to the satisfaction, at or before the Closing, of each of the following conditions:

 

(a)           The representations and warranties of Purchaser contained herein that are qualified as to materiality shall be true in all respects on and as of the Closing Date (except for such representations and warranties made as of a specific date which shall be true as of such date) with the same force and effect as though made on and as of such date, and each of the representations and warranties of Purchaser that are not so qualified shall be true in all material respects on and as of the Closing Date (except for such representations and warranties made as of a specific date which shall be true in all material respects as of such date).

 

(b)           Purchaser shall have performed and complied in all material respects with all covenants, agreements, obligations and conditions required by this Agreement to be so performed or complied with by Purchaser at or prior to the Closing.

 

(c)           There shall not be threatened, instituted or pending any Proceeding by or before any court or Govern­mental Body requesting or looking toward an Order, that (a) restrains or prohibits the consummation of the Share Exchange or (b) could have a Material Adverse Effect on Purchaser.

 

(d)           On the Closing Date, there shall be no effective Order issued by a court of competent jurisdiction restraining or prohibiting the consummation of the Share Exchange.

 

  

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ARTICLE IX.

 

SURVIVAL OF REPRESENTATIONS

 

All representations and warranties made by any Party in this Agreement or pursuant hereto, as modified by any Disclosure Schedule, exhibit, certificate or other document executed and delivered pursuant hereto shall survive the Closing and any investigation made by or on behalf of any Party for a period of one (1) year following the Closing Date.  All statements contained herein or in any schedule, exhibit, certificate or other document executed and delivered pursuant hereto shall be deemed representations and warranties for purposes of Sections 8.2(a) and 8.3(a).  The right to any remedy based upon such representations and warranties shall not be affected by any investigation conducted with respect to, or any Knowledge acquired at any time, whether before or after execution and delivery of this Agreement or the Closing Date, with respect to the accuracy or inaccuracy of any such representation or warranty.

 

ARTICLE X.

 

TERMINATION, AMENDMENT AND WAIVER

 

10.1           Termination.

 

This Agreement may be terminated at anytime prior to the Closing:

 

(a)          by mutual written consent of Purchaser and Exactus;

 

(b)          by Purchaser or Exactus:

 

(i)           if the Share Exchange shall not have been consummated on or before February 29, 2016, unless the failure to consummate the Share Exchange is the result of a willful and material Breach of this Agreement by the Party seeking to terminate this Agreement;

 

(ii)           if any court of competent jurisdiction or other Governmental Body shall have issued an Order or taken any other action permanently enjoining, restraining or otherwise prohibiting the Share Exchange and such order, decree, ruling or other action shall have become final and non-appealable;

 

(iii)           in the event of a Breach by the other Party of any representation, warranty, covenant or other agreement contained in this Agreement which cannot be or has not been cured within ten (10) days after the giving of written notice to the breaching Party of such Breach (provided that the terminating Party is not then in Breach of any representation, warranty, covenant or other agreement contained in this Agreement);

  

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(iv)           in the event that (i) all of the conditions to the obligation of such Party to effect the Share Exchange set forth in Section 8.1 shall have been satisfied and (ii) any condition to the obligation of such Party to effect the Share Exchange set forth in Section 8.2 (in the case of Purchaser) or Section 8.3 (in the case of Exactus) is not capable of being satisfied prior to the end of the period referred to in Section 10.1(b)(i); or

 

(v)           if there shall have occurred prior to the Closing changes in Applicable Law that, in the aggregate, shall have a Material Adverse Effect on either Party.

 

10.2           Effect of Termination.

 

In the event of termination of this Agreement, this Agreement shall forthwith become void and have no effect, without any liability or obligation on the part of any Party except to the extent that such termination results from the willful and material Breach by a Party of any of its representations, warranties, covenants or other agreements set forth in this Agreement, in which case the terminating Party shall have the right to pursue any remedies available to it at law or in equity.

 

10.3           Amendment.

 

This Agreement may not be amended except by an instrument in writing signed on behalf of each of the Parties.

 

10.4           Extension; Waiver.

 

At any time prior to the Closing, the Parties may (i) extend the time for the performance of any of the obligations or other acts of the other Parties, (ii) waive any inaccuracies in the representations and warranties contained in this Agreement or in any document delivered pursuant to this Agreement or (iii) waive compliance with any of the agreements or conditions contained in this Agreement.  Any agreement on the part of a Party to any such extension or waiver shall be valid only if set forth in an instrument in writing signed on behalf of such Party.

 

ARTICLE XI.

 

MISCELLANEOUS

 

11.1           Notices.

 

Any communications required or desired to be given hereunder shall be deemed to have been properly given if sent by hand delivery or by facsimile and overnight courier or overnight courier to the parties hereto at the following addresses, or at such other address as either party may advise the other in writing from time to time:

  

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If to Purchaser:

Spiral Energy Tech, Inc.

Attention: Elliot Maza

550 Sylvan Avenue, Suite 101

Englewood Cliffs, NJ 07632

with a copy to:

Laxague Law, Inc.

1 East Liberty, Suite 600

Reno, NV 89501

Attention:  Joe Laxague, Esq.

If to Exactus:

Exactus Biosolutions, Inc.

Attention: Tim Ryan

80 Eighth Ave, Ste 1107

New York, NY 10011

with a copy to:

Exactus BioSolutions, Inc.

Attention: Philip J. Young

307 Riverside Court

Richmond, VA23238

All such communications shall be deemed to have been delivered on the date of hand delivery or facsimile or on the next Business Day following the deposit of such communications with the overnight courier.

11.2           Further Assurances.

 

Each Party hereby agrees to perform any further acts and to execute and deliver any documents which may be reasonably necessary to carry out the provisions of this Agreement.

 

11.3           Governing Law.

 

This Agreement shall be interpreted, construed and enforced in accordance with the laws of the State of Nevada, applied without giving effect to any conflicts-of-law principles.

 

11.4           Commissions.

 

Each of the Parties hereto represents and warrants that no broker or finder is entitled to any brokerage or finder's fee or other commission in connection with the Share Exchange.  Each of the Parties hereto shall pay or discharge, and shall indemnify and hold the other harmless from and against, all claims or liabilities for brokerage commissions or finder's fees incurred by reason of any action taken by it.

 

  

-17-

  

 

11.5           Captions.

 

The captions or headings in this Agreement are made for convenience and general reference only and shall not be construed to describe, define or limit the scope or intent of the provisions of this Agreement.

 

11.6           Integration of Exhibits and Schedules.

 

All Exhibits and Disclosure Schedules to this Agreement are integral parts of this Agreement as if fully set forth herein.

 

11.7           Entire Agreement.

 

This Agreement, the Related Agreements, including all Exhibits and Disclosure Schedules attached hereto and thereto contain the entire agreement of the Parties and supersede any and all prior or contemporaneous agreements between the Parties, written or oral, with respect to the transactions contemplated hereby.  Such agreement may not be changed or terminated orally, but may only be changed by an agreement in writing signed by the Party or Parties against whom enforcement of any waiver, change, modification, extension, discharge or termination is sought.

 

11.8           Expenses.

 

Except as expressly provided otherwise, each party hereto will bear its own costs and expenses (including fees and expenses of auditors, attorneys, financial advisors, bankers, brokers and other consultants and advisors) incurred in connection with this Agreement, the Related Agreements and the transactions contemplated hereby and thereby.

 

11.9           Counterparts.

 

This Agreement may be executed in several counterparts, each of which, when so executed, shall be deemed to be an original, and such counterparts shall together constitute and be one and the same instrument.

 

11.10           Binding Effect.

 

This Agreement shall be binding on, and shall inure to the benefit of, the Parties hereto, and their respective successors and assigns, and no other person shall acquire or have any right under or by virtue of this Agreement.  No Party may assign any right or obligation hereunder without the prior written consent of the other Parties.

 

11.11           No Rule of Construction.

 

The Parties agree that, because all Parties participated in negotiating and drafting this Agreement, no rule of construction shall apply to this Agreement which construes ambiguous language in favor of or against any Party by reason of that Party's role in drafting this Agreement.

 

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 

  

-18-

  

 

SIGNATURE PAGE OF PURCHASER AND EXACTUS TO

 

SHARE EXCHANGE AGREEMENT AND PLAN OF REORGANIZATION

 

IN WITNESS WHEREOF, Purchaser and Exactus have caused this Share Exchange Agreement and Plan of Reorganization to be executed by their respective duly authorized officers, all as of the day and year first above written.

 

	  	
By Purchaser:

	  	  
	  	
SPIRAL ENERGY TECH., INC.

	
 

 

Dated: ____________________________

	
 

 

 

By: Elliot Maza

Its: Chief Executive Officer

	  	  
	  	
By Exactus:

	  	  
	  	
EXACTUS BIOSOLUTIONS, INC.

	
 

 

Dated: ____________________________

	
 

 

 

By: Phil Young

Its: Chief Executive Officer

	  	  
	  	  
	  	  
	  	  
	  	  
	  	  
	  	  
	  	  
	  	  

  

-19-

  

 

SIGNATURE PAGE OF SHAREHOLDERS OF EXACTUS TO

 

SHARE EXCHANGE AGREEMENT

 

IN WITNESS WHEREOF, the Shareholders of Exactus have executed this Share Exchange Agreement as of the day and year first above written.

 

	  	
/s/ Phil Young                                    

Phil Young

	  	  
	  	
/s/ James Erickson                             

James Erickson

	  	  
	  	
Digital Diagnostics, Pty

 

	By:	
 /s/Krassen Dimitron, Ph.D.             

 

	Print name:	
 Krassen Dimitron, Ph.D.                  

 

	 Title:	 President                                            
	  	  
	 	Willets Capital LLC
	By:	
	
Print name:  

 

Title:  

	
Tim Ryan                                   

 

Member                                      

	  	  
	 	Tonset Capital LLC
	 By:	 
	Print name:  

 

Title:  

	

Tim Ryan                                   

 

Member                                      

	  	  
	  	

Tim Ryan

	  	  
	  

 

By: 

 

Print name: 

 

Title: 

	
Donegal Bio Ventures, LLC

 

 /s/ Kevin J. Esual                  

  

 Keven J. Esual                       

 

 President                                 

                                                           

	  	  
	  

 

By: 

 

Print name: 

 

Title: 

	
VelocityHealth Capital

 

 /s/ Kevin J. Esual                  

  

 Keven J. Esual                       

 

 President                                 

 

 

	  	  
	  

 

By: 

 

Print name: 

 

Title: 

	
Darwin Investments LLC

 

  /s/ Harvey Kesner                

  

 harvey Kesner                        

 

 Manager                                  

	  	  
	 	NYTX LLC
	 By:	
	Print name:  

 

Title:  

	

Tim Ryan                                   

 

Member                                      

	  	  
	  	
/s/ Dale Yakin                             

Dale Yakin

	  	  
	 	Brosis Capital LLC
	By:	 
	
Print name:  

 

Title:  

	
Tim Ryan                                    

 

Member                                      

	  	  
	  

 

By: 

 

Print name: 

 

Title: 

	
JVC

 

 /s/ Joseph Van Cook                

 

 Joseph Van Cook                       

 

 N/A                                              

  

-20-

  

 

Schedule 2.1

 

	
Exactus Shareholder Name

	
Number of Purchaser Series B-1 Preferred Shares to be Issued

	
Phil Young

	
     8,500,000

	
Jim Erickson

	
     4,400,000

	
Digital Diagnostics, PTY

	
     4,000,000

	
Willets Capital LLC

	
     2,950,000

	
Tonset Capital LLC

	
     2,850,000

	
Tim Ryan

	
     1,950,000

	
Donegal Bio Ventures, LLC

	
     1,500,000

	
VelocityHealth Capital

	
     1,500,000

	
Darwin Investments LLC

	
     1,200,000

	
NYTX LLC

	
        400,000

	
Dale Yakin

	
        400,000

	
Brosis LLC

	
        300,000

	
Joseph Van Cook

	
          50,000

	
Barry Honig

	
     2,000,000

	
Total

	
32,000,000

 

  

-21-

  

Schedule 2.5

 

Philip J. Young – Chief Executive Officer

 

Tim Ryan – Executive Vice President

 

 

Board Members:

 

Philip J. Young (Chairman)

 

Tim Ryan

 

-22-

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