Document:

ex10-1.htm

EXHIBIT 10.1

 

Securities Purchase Agreement

 

SECURITIES PURCHASE AGREEMENT

 

SECURITIES PURCHASE AGREEMENT (this “Agreement”), dated as of May __, 2016, by and among MEDITE Cancer Diagnostics, Inc., a Delaware corporation, with headquarters located at 4203 SW 34th Street, Orlando, Florida 32811 (the “Company”), and each of the purchasers set forth on the signature pages hereto (the “Buyers” and each, a “Buyer”).

 

WHEREAS:

 

A.           The Company and the Buyers are executing and delivering this Agreement in reliance upon an exemption from securities registration afforded by the rules and regulations as promulgated by the United States Securities and Exchange Commission (the “SEC” or “Commission”) under the Securities Act of 1933, as amended (the “1933 Act”);

 

B.           Buyers desire to purchase and the Company desires to issue and sell, upon the terms and conditions set forth in this Agreement 15% secured promissory notes of the Company, in the form attached hereto as Exhibit “A”, in the aggregate principal amount of up to One Hundred Fifty Thousand Dollars ($150,000) (the “ Notes”) and common stock purchase warrants, in the form attached hereto as Exhibit “B” (the “Warrants”), to acquire up to 150,000 shares of common stock, par value $0.001 per share (the “Common Stock”).

 

C.           Each Buyer wishes to purchase, upon the terms and conditions stated in this Agreement, such principal amount of Notes and related Warrants as set forth on each Buyer’s signature pages hereto; and

 

NOW THEREFORE, the Company and each of the Buyers severally (and not jointly) hereby agree as follows:

 

1. PURCHASE AND SALE OF  NOTES AND WARRANTS.

 

a. Purchase of  Notes and Warrants.  On the Closing Date (as defined below), the Company shall issue and sell to each Buyer and each Buyer severally agrees to purchase from the Company such principal amount of  Notes and such number of Warrants as is set forth on such Buyer’s signature pages hereto.

 

b. Form of Payment.  On the Closing Date (as defined below), (i) each Buyer shall pay the purchase price for the  Notes and Warrants to be issued and sold to it at the Closing (as defined below) (the “Purchase Price”) by wire transfer of immediately available funds to the Company, in accordance with the Company’s written wiring instructions, against delivery of the  Notes in the principal amount equal to the Purchase Price and the Warrants to purchase an amount of Common Stock equal to one-half (1/2) of the amount of such Buyer’s Note, and (ii) the Company shall deliver such  Notes and Warrants duly executed on behalf of the Company, to such Buyer, against delivery of such Purchase Price.

 

c. Closing Date.  Subject to the satisfaction (or written waiver) of the conditions thereto set forth in Section 6 and Section 7 below, the date and time of the issuance and sale of the  Notes and the Warrants pursuant to this Agreement (the “Closing Date”) shall be 12:00 noon, Eastern Standard Time on May __, 2016, or such other mutually agreed upon time.  The closing of the transactions contemplated by this Agreement (the “Closing”) shall occur on the Closing Date at such location as may be agreed to by the parties.

  

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2. BUYERS’ REPRESENTATIONS AND WARRANTIES.  Each Buyer severally (and not jointly) represents and warrants to the Company solely as to such Buyer that:

 

a. Investment Purpose.  As of the date hereof, the Buyer is purchasing the  Notes, the Warrants and the shares of Common Stock issuable upon and exercise of the Warrants (such shares of Common Stock issuable in connection with the Warrants being collectively referred to herein as the “Warrant Shares” and, collectively with the  Notes, Warrants and Warrant Shares, the “Securities”) for its own account and not with a present view towards the public sale or distribution thereof, except pursuant to sales registered or exempted from registration under the 1933 Act.

 

b. Accredited Investor Status.  The Buyer is an “accredited investor” as that term is defined in Rule 501(a) of Regulation D (an “Accredited Investor”).

 

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

 

d. Governmental Review.  The Buyer understands that no United States federal or state agency or any other government or governmental agency has passed upon or made any recommendation or endorsement of the Securities.

 

e. Transfer or Re-sale.  The Buyer understands that (i) the sale or re-sale of the Securities has not been and is not being registered under the 1933 Act or any applicable state securities laws, and the Securities may not be transferred unless (a) the Securities are sold pursuant to an effective registration statement under the 1933 Act, (b) the Buyer shall have delivered to the Company an opinion of counsel that shall be in form, substance and scope customary for opinions of counsel in comparable transactions to the effect that the Securities to be sold or transferred may be sold or transferred pursuant to an exemption from such registration, which opinion shall be accepted by the Company, (c) the Securities are sold or transferred to an “affiliate” (as defined in Rule 144 promulgated under the 1933 Act (or a successor rule) (“Rule 144”)) of the Buyer who agrees to sell or otherwise transfer the Securities only in accordance with this Section 2(e) and who is an Accredited Investor, (d) the Securities are sold pursuant to Rule 144, or (e) the Securities are sold pursuant to Regulation S under the 1933 Act (or a successor rule) (“Regulation S”), and the Buyer shall have delivered to the Company an opinion of counsel that shall be in form, substance and scope customary for opinions of counsel in corporate transactions, which opinion shall be accepted by the Company; (ii) any sale of such Securities made in reliance on Rule 144 may be made only in accordance with the terms of said Rule and further, if said Rule is not applicable, any re-sale of such Securities under circumstances in which the seller (or the person through whom the sale is made) may be deemed to be an underwriter (as that term is defined in the 1933 Act) may require compliance with some other exemption under the 1933 Act or the rules and regulations of the SEC thereunder; and (iii) neither the Company nor any other person is under any obligation to register such Securities under the 1933 Act or any state securities laws or to comply with the terms and conditions of any exemption thereunder.  Notwithstanding the foregoing or anything else contained herein to the contrary, the Securities may be pledged as collateral in connection with a bona fide margin account or other lending arrangement.

 

f. Legends.  The Buyer understands that the  Notes, Warrants and, until such time as the Warrant Shares have been registered under the 1933 Act or otherwise may be sold pursuant to Rule 144, the Securities may bear a restrictive legend in substantially the following form (and a stop-transfer order may be placed against transfer of the certificates for such Securities):

 

“THE SECURITIES REPRESENTED BY THIS CERTIFICATE (THE “SECURITIES”) HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”) OR ANY STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS REGISTERED UNDER THE SECURITIES ACT AND UNDER APPLICABLE STATE SECURITIES LAWS OR THE COMPANY SHALL HAVE RECEIVED AN OPINION OF COUNSEL THAT REGISTRATION OF SUCH SECURITIES UNDER THE SECURITIES ACT AND UNDER THE PROVISIONS OF APPLICABLE STATE SECURITIES LAWS IS NOT REQUIRED.”

  

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The legend set forth above shall be removed and the Company shall issue a certificate without such legend to the holder of any Securities upon which it is stamped, if, unless otherwise required by applicable state securities laws, (a) such Securities are registered for sale under an effective registration statement filed under the 1933 Act, or (b) such holder provides the Company with an opinion of counsel, in form, substance and scope customary for opinions of counsel in comparable transactions, to the effect that a public sale or transfer of such Securities may be made without registration under the 1933 Act, which opinion shall be accepted by the Company so that the sale or transfer is effected or (c) such holder provides the Company with reasonable assurances that such Securities can be sold pursuant to Rule 144 or Regulation S.  The Buyer agrees to sell all Securities, including those represented by a certificate(s) from which the legend has been removed, in compliance with applicable prospectus delivery requirements, if any.

 

g. Authorization; Enforcement. This Agreement has been duly and validly authorized.  This Agreement has been duly executed and delivered on behalf of the Buyer, and this Agreement constitutes valid and binding agreements of the Buyer enforceable in accordance with their terms.

 

h. Residency.  The Buyer is a resident of the jurisdiction set forth in such Buyer’s Investor Information.

 

i. Brokers.  The Buyer acknowledges that the Company has engaged TriPoint Global Equities, LLC a broker dealer registered with FINRA (“TriPoint”), as a placement agent in connection with the sale of the  Notes and Warrants and TriPoint shall be entitled to (collectively, the “PA Fee”) a cash fee equal to three (3%) percent of the gross proceeds and warrants to purchase three percent (3%) of the number of shares of Common Stock underlying the Warrants (the “PA Warrants”); the PA Warrants will contain the same terms and conditions as the Warrants issued to the Buyers.

 

j. Waiver of Conflicts. The Buyer acknowledges that two of the registered representatives of TriPoint (the “Representatives”) represent the Company in this and/or other transactions and that the Company previously agreed to waive any potential conflict that may arise between the Representatives’ representation of the Company and its status as registered representatives of TriPoint.  The Representatives have assisted the Company to structure the transactions contemplated by this Agreement and may also participate in the Offering as investors, which may represent a conflict of interest.  The Buyer agrees that, so long as the Representatives comply with their duties and responsibilities, Buyer waives all actual or perceived conflicts of interest that may exist by reason of the Representatives acting in dual capacity as registered representatives of TriPoint, the placement agent for the transaction contemplated by this Agreement and as representatives of the Company in this or other transactions.

 

3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.  The Company represents and warrants to each Buyer that:

 

a. Organization and Qualification.  The Company and each of its Subsidiaries, if any, is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction in which it is incorporated, with full power and authority (corporate and other) to own, lease, use and operate its properties and to carry on its business as and where now owned, leased, used, operated and conducted.  “Subsidiary” shall mean any corporation or other entity of which at least a majority of the securities or other ownership interests having ordinary voting power (absolutely or contingently) for the election of directors or other persons performing similar functions are at the time owned directly or indirectly by the Company and/or any of its other Subsidiaries.

 

b. Authorization; Enforcement.  The Company has all requisite corporate power and authority to enter into and perform this Agreement.

 

c. Capitalization.  The capitalization of the Company is as set forth on Schedule 3(c) attached hereto.  The Company presently has 35,000,000 shares of Common Stock authorized, of which 21,055,990 are issued and outstanding as of May __, 2016.

 

  

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d. Issuance of Shares.  The Warrant Shares are duly authorized and reserved for issuance upon exercise of the Warrants.

 

e. Acknowledgment of Dilution.  The Company understands and acknowledges the potentially dilutive effect to the Common Stock upon the issuance of the Warrant Shares.

 

f. Bad Actor Representation.  None of the Company, any of its predecessors, any affiliated issuer, any director, executive officer, other officer of the Company participating in the offering, any beneficial owner of 20% or more of the Company’s outstanding voting equity securities, calculated on the basis of voting power, nor any promoter (as that term is defined in Rule 405 under the Securities Act) connected with the Company in any capacity at the time of sale (each, an “Issuer Covered Person” and, together, “Issuer Covered Persons”) is subject to any of the “Bad Actor” disqualifications described in Rule 506(d)(1)(i) to (viii) under the Securities Act (a “Disqualification Event”), except for a Disqualification Event covered by Rule 506(d)(2) or (d)(3). The Company has exercised reasonable care to determine whether any Issuer Covered Person is subject to a Disqualification Event.

 

g. Litigation.  There is no action, suit, proceeding, or investigation (including without limitation any suit, proceeding, or investigation involving the prior employment of any of the Company’s employees, their use in connection with the Company’s business of any information or techniques allegedly proprietary to any of their former employers, or their obligations under any agreements with prior employers) pending or, to the best of the Company’s knowledge, currently threatened before any court, administrative agency, or other governmental body.  The Company is not a party or subject to, and none of its assets is bound by, the provisions of any order, writ, injunction, judgment, or decree of any court or government agency or instrumentality.  There is no action, suit, or proceeding by the Company currently pending or that the Company intends to initiate.

 

h. Disclosure.  Except as set forth on Schedule 3(h), the Company has fully provided each Buyer with all the information that such Buyer has requested for deciding whether to purchase the Securities and all material information that the Company believes is reasonably necessary to enable a reasonable Buyer to make such decision.  Neither this Agreement, nor any other agreements, statements or certificates made or delivered to Buyer in connection herewith or therewith contains any untrue statement of a material fact or, when taken together, omits to state a material fact necessary to make the statements herein or therein, in light of the circumstances under which they were made, not misleading.

 

i. Shell Company Status.  During the previous twelve (12) months, the Company has not been a shell as such term is defined in Rule 144(i) under the Securities Act.

 

j. Commission Documents, Financial Statements. The Company has filed all reports, schedules, forms, statements and other documents required to be filed by it with the Commission pursuant to the reporting requirements of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), including material filed pursuant to Section 13(a) or 15(d) of the Exchange Act (all of the foregoing including filings incorporated by reference therein being referred to herein as the “Commission Documents”).  The Company has not provided to the Buyers any material non-public information or other information which, according to applicable law, rule or regulation, was required to have been disclosed publicly by the Company but which has not been so disclosed, other than (i) with respect to the transactions contemplated by this Agreement, or (ii) pursuant to a non-disclosure or confidentiality agreement signed by the Buyers.  At the time of the respective filings, the Commission Documents complied in all material respects with the requirements of the Exchange Act and the rules and regulations of the Commission promulgated thereunder and other federal, state and local laws, rules and regulations applicable to such documents.  As of their respective filing dates, none of the Commission Documents contained any untrue statement of a material fact; and none omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. The financial statements of the Company included in the Commission Documents (the “Financial Statements”) comply as to form in all material respects with applicable accounting requirements and the published rules and regulations of the Commission or other applicable rules and regulations with respect thereto. The Financial Statements have been prepared in accordance with United States generally accepted accounting principles (“GAAP”) applied on a consistent basis during the periods involved (except (i) as may be otherwise indicated in the Financial Statements or the notes thereto or (ii) in the case of unaudited interim statements, to the extent they may not include footnotes or may be condensed or summary statements), and fairly present in all material respects the consolidated financial position of the Company as of the dates thereof and the results of operations and cash flows for the periods then ended (subject, in the case of unaudited statements, to normal year-end audit adjustments)

 

  

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k. No Material Adverse Effect. Since March 31, 2016, neither the Company, nor any Subsidiary has experienced or suffered any Material Adverse Effect. For the purposes of this Agreement, “Material Adverse Effect” means any of  (i) a material and adverse effect on the legality, validity or enforceability of this Agreement, the Security Agreement, the Notes, the Investor Information (as defined below), the Warrants, all exhibits thereto and hereto and any other documents or agreements executed in connection with the transactions contemplated hereunder (collectively, the “Transaction Documents”), (ii) a material adverse effect on the business, operations, properties, or financial condition of the Company, its Subsidiaries, individually, or in the aggregate and/or any condition, circumstance, or situation that would prohibit or otherwise materially interfere with the ability of the Company to perform any of its obligations under this Agreement or the other Transaction Documents in any material respect or (iii) an adverse impairment to the Company’s ability to perform on a timely basis its obligations under this Agreement or the other Transaction Document.

 

l. No Undisclosed Liabilities.  Other than as disclosed on Schedule 3(l) or set forth in the Commission Documents, to the knowledge of the Company, neither the Company, nor any Subsidiary has any liabilities, obligations, claims or losses (whether liquidated or unliquidated, secured or unsecured, absolute, accrued, contingent or otherwise) other than those incurred in the ordinary course of the Company’s and any Subsidiary’s respective businesses since March 31, 2016, and those which, individually or in the aggregate, do not have a Material Adverse Effect on the Company and any Subsidiary.

 

m. No Undisclosed Events or Circumstances. To the Company’s knowledge, no event or circumstance has occurred or exists with respect to the Company or any Subsidiary or their respective businesses, properties, operations or financial condition, which, under applicable law, rule or regulation, requires public disclosure or announcement by the Company but which has not been so publicly announced or disclosed.

 

n. Indebtedness. Other than as set forth on Schedule 3(n), the Financial Statements set forth all outstanding Indebtedness of the Company, or for which the Company, or any Subsidiary have commitments as of the date of the Financial Statements or any subsequent period that would require disclosure. For the purposes of this Agreement, “Indebtedness” shall mean (a) any liabilities for borrowed money or amounts owed (other than trade accounts payable incurred in the ordinary course of business), (b) all guaranties, endorsements and other contingent obligations in respect of Indebtedness of others, whether or not the same should be reflected in the Company’s consolidated balance sheet (or the Securities thereto), except guaranties by endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business; and (c) the present value of any lease payments due under leases required to be capitalized in accordance with GAAP.  Neither the Company, nor any Subsidiary is in default with respect to any Indebtedness which, individually or in the aggregate, would have a Material Adverse Effect.

 

o. Title to Assets. Except as set forth on Schedule 3(o),the Company has good and marketable title in fee simple to all real property owned by it and good and marketable title in all personal property owned by it that is material to the business of the Company, in each case free and clear of all Liens, except for (i) Liens as do not materially affect the value of such property and do not materially interfere with the use made and proposed to be made of such property by the Company and (ii) Liens for the payment of federal, state or other taxes, for which appropriate reserves have been made therefore in accordance with GAAP and, the payment of which is neither delinquent nor subject to penalties (liens referenced in subsection (i) and (ii) above are collectively referred to as "Permitted Liens").  Any real property and facilities held under lease by the Company are held by it under valid, subsisting and enforceable leases with which the Company is in compliance.

 

p. Actions Pending. Except as disclosed in the Commission Documents or on Schedule 3(p), there is no action, suit, claim, investigation, arbitration, alternate dispute resolution proceeding or any other proceeding pending or, to the knowledge of the Company, threatened against or involving the Company, any Subsidiary (i) which questions the validity of this Agreement or any of the other Transaction Documents or the transactions contemplated hereby or thereby or any action taken or to be taken pursuant hereto or thereto or (ii) involving any of their respective properties or assets.  To the knowledge of the Company, there are no outstanding orders, judgments, injunctions, awards or decrees of any court, arbitrator or governmental or regulatory body against the Company or any Subsidiary or any of their respective executive officers or directors in their capacities as such.

 

  

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q. Compliance with Law.  The Company and its Subsidiaries have all material franchises, permits, licenses, consents and other governmental or regulatory authorizations and approvals necessary for the conduct of their respective business as now being conducted by it unless the failure to possess such franchises, permits, licenses, consents and other governmental or regulatory authorizations and approvals, individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect.

 

r. Compliance.  Except as set forth in the in Schedule 3(r), the Company: (i) is not in default under or in violation of (and no event has occurred that has not been waived that, with notice or lapse of time or both, would result in a default by the Company), nor has the Company received notice of a claim that it is in default under or that it is in violation of, any indenture, loan or credit agreement or any other agreement or instrument to which it is a party or by which it or any of its properties is bound (whether or not such default or violation has been waived), (ii) is in violation of any judgment, decree or order of any court, arbitrator or other governmental authority or (iii) is or has been in violation of any statute, rule, ordinance or regulation of any governmental authority, including without limitation all foreign, federal, state and local laws relating to taxes, environmental protection, occupational health and safety, product quality and safety and employment and labor matters, except in each case as could not have or reasonably be expected to result in a Material Adverse Effect.

 

s. No Violation.  The business of the Company and any Subsidiary is not being conducted in violation of any federal, state, local or foreign governmental laws, or rules, regulations and ordinances of any governmental entity, except for possible violations which singularly or in the aggregate could not reasonably be expected to have a Material Adverse Effect. The Company is not required under federal, state, local or foreign law, rule or regulation to obtain any consent, authorization or order of, or make any filing or registration with, any court or governmental agency in order for it to execute, deliver or perform any of its obligations under the Transaction Documents, or issue and sell the  Notes, the Warrants or Warrant Shares in accordance with the terms hereof or thereof (other than (x) any consent, authorization or order that has been obtained as of the date hereof, (y) any filing or registration that has been made as of the date hereof or (z) any filings which may be required to be made by the Company with the Commission or state securities administrators subsequent to the Closing).

 

t. No Conflicts. The execution, delivery and performance of this Agreement and the Transaction Documents by the Company and the consummation by the Company of the transactions contemplated herein and therein do not and will not (i) violate any provision of the Articles or Bylaws, (ii) conflict with, or constitute a default (or an event which with notice or lapse of time or both would become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, any agreement, mortgage, deed of trust, indenture, note, bond, license, lease agreement, instrument or obligation to which the Company or any Subsidiary is a party or by which it or its properties or assets are bound, (iii) create or impose a lien, mortgage, security interest, pledge, charge or encumbrance (collectively, “Lien”) of any nature on any property of the Company or any Subsidiary under any agreement or any commitment to which the Company or any Subsidiary is a party or by which the Company, or any Subsidiary is bound or by which any of its respective properties or assets are bound, or (iv) result in a violation of any federal, state, local or foreign statute, rule, regulation, order, judgment or decree (including federal and state securities laws and regulations) applicable to the Company or any Subsidiary or by which any property or asset of the Company, or any Subsidiary are bound or affected, provided, however, that, excluded from the foregoing in all cases are such conflicts, defaults, terminations, amendments, accelerations, cancellations and violations as would not, individually or in the aggregate, have a Material Adverse Effect.

 

u. Taxes. Other than as set forth on Schedule 3(u), each of the Company and any Subsidiary, to the extent its applicable, has accurately prepared and filed all federal, state and other tax returns required by law to be filed by it, has paid or made provisions for the payment of all taxes shown to be due other than payment being contested and all additional assessments, and adequate provisions have been and are reflected in the consolidated financial statements of the Company for all current taxes and other charges to which the Company, or any Subsidiary, if any, is subject and which are not currently due and payable. None of the federal income tax returns of the Company have been audited by the Internal Revenue Service. The Company has no knowledge of any additional assessments, adjustments or contingent tax liability (whether federal, state or foreign) of any nature whatsoever, whether pending or threatened against the Company or any Subsidiary for any period, nor of any basis for any such assessment, adjustment or contingency.

 

  

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v. Intellectual Property. Each of the Company and any Subsidiary, owns or has the lawful right to use all patents, trademarks, domain names (whether or not registered) and any patentable improvements or copyrightable derivative works thereof, websites and intellectual property rights relating thereto, service marks, trade names, copyrights, licenses and authorizations, if any, and all rights with respect to the foregoing, if any, which are necessary for the conduct of their respective business as now conducted without any conflict with the rights of others, except where the failure to so own or possess would not have a Material Adverse Effect.

 

w. Books and Records Internal Accounting Controls. Except as may have otherwise been disclosed in the Commission Documents, the books and records of the Company, and any Subsidiary accurately reflect in all material respects the information relating to the business of the Company and any Subsidiary, the location and collection of their assets, and the nature of all transactions giving rise to the obligations or accounts receivable of the Company, or any Subsidiary.  Except as disclosed in the Commission Documents, the Company and any Subsidiary maintain a system of internal accounting controls sufficient, in the judgment of the Company, to provide reasonable assurance that (i) transactions are executed in accordance with management’s general or specific authorizations, (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with GAAP and to maintain asset accountability, (iii) access to assets is permitted only in accordance with management’s general or specific authorization and (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate actions are taken with respect to any differences.

 

x. Material Agreements. Any and all written or oral contracts, instruments, agreements, commitments, obligations, plans or arrangements, the Company and any Subsidiary is a party to, that a copy of which would be required to be filed with the Commission as an exhibit to a registration statement (collectively, the “Material Agreements”) if the Company or any Subsidiary were registering securities under the Securities Act has previously been publicly filed with the Commission in the Commission Documents.  Each of the Company and any Subsidiary has in all material respects performed all the obligations required to be performed by them to date under the foregoing agreements, have received no notice of default and are not in default under any Material Agreement now in effect the result of which would cause a Material Adverse Effect.

 

y. Transactions with Affiliates. Except as set forth in the Financial Statements or in the Commission Documents or on Schedule 3(y), there are no loans, leases, agreements, contracts, royalty agreements, management contracts or arrangements or other continuing transactions between (a) the Company, or any Subsidiary on the one hand, and (b) on the other hand, any officer, employee, consultant or director of the Company or any Subsidiary, or any person owning more than 10% capital stock of the Company, or any Subsidiary, or any member of the immediate family of such officer, employee, consultant, director or stockholder or any corporation or other entity controlled by such officer, employee, consultant, director or stockholder, or a member of the immediate family of such officer, employee, consultant, director or stockholder

 

z. Private Placement and Solicitation.  Assuming the accuracy of the Buyers’ representations and warranties set forth in Section 2, no registration under the Securities Act is required for the offer and sale of the Securities by the Company to the Buyers as contemplated hereby.  Based in part on the accuracy of the representations of the Buyers in Section 2, and subject to timely applicable Form D filings pursuant to Regulation D of the Securities Act with the Commission and pursuant to applicable state securities laws, the offer, sale and issuance of the Securities to be issued pursuant to and in conformity with the terms of this Agreement, will be issued in compliance with all applicable federal and state securities laws.  Neither the Company nor any of its affiliates, nor any person acting on its or their behalf, has engaged in any form of general solicitation or general advertising (within the meaning of Regulation D under the Securities Act) in connection with the offer or sale of any of the  Notes, Warrants or Warrant Shares.

 

aa. Governmental Approvals. Except for the filing of any notice prior or subsequent to the Closing Date that may be required under applicable state and/or federal securities laws (which if required, shall be filed on a timely basis), including the filing of a Form D, no authorization, consent, approval, license, exemption of, filing or registration with any court or governmental department, commission, board, bureau, agency or instrumentality, domestic or foreign, is or will be necessary for, or in connection with, the execution or delivery of the  Notes, Warrants or Warrant Shares, or for the performance by the Company of its obligations under this Agreement and the Transaction Documents.

 

  

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bb. Employees. Except as disclosed on Schedule 3(bb), neither the Company nor any Subsidiary has any collective bargaining arrangements covering any of its employees.  Schedule 3(bb) sets forth a list of the employment contracts, agreements regarding proprietary information, non-competition agreements, non-solicitation agreements, confidentiality agreement, or any other similar contract or restrictive covenant, relating to the right of any officer, employee or consultant to be employed or engaged by the Company. Since March 31, 2016, no officer, consultant or key employee of the Company or any Subsidiary whose termination, either individually or in the aggregate, would have a Material Adverse Effect, has terminated or, to the knowledge of the Company, has any present intention of terminating his or her employment or engagement with the Company or any Subsidiary.

 

4. COVENANTS.

 

a. Best Efforts.  The parties shall use their best efforts to satisfy timely each of the conditions described in Section 6 and 7 of this Agreement.

 

b. Blue Sky Laws.  The Company shall, on or before the Closing Date, take such action as the Company shall reasonably determine is necessary to qualify the Securities for sale to the Buyers at the applicable closing pursuant to this Agreement under applicable securities or “blue sky” laws of the states of the United States (or to obtain an exemption from such qualification), and shall provide evidence of any such action so taken to each Buyer on or prior to the Closing Date.

 

c. Use of Proceeds.  The Company shall use the proceeds from the sale of the Notes for general working capital purposes and shall not, directly or indirectly, use such proceeds for any distribution or dividend to any shareholder of the Company.

 

d. Securities Compliance. The Company shall notify the Commission in accordance with its rules and regulations, of the transactions contemplated by this Agreement and the Transaction Documents, including filing a Form D with respect to the Securities, as required under Regulation D and applicable “blue sky” laws if such Securities are offered pursuant to Rule 506 of Regulation D and shall take all other necessary action and proceedings as may be required and permitted by applicable law, rule and regulation, for the legal and valid issuance of the  Notes, Warrants and Warrant Shares to the Buyers or subsequent holders.

 

e. Liquidation.  Subject to the terms of the Transaction Documents, the Company covenants that it will take such further action as the Buyers may reasonably request, all to the extent required from time to time to enable the Buyers to sell the Securities without registration under the Securities Act within the limitation of the exemptions provided by Rule 144 promulgated under the Securities Act, as amended.

 

f. Keeping of Records and Books of Account.  The Company shall keep and cause each Subsidiary to keep adequate records and books of account, in which complete entries will be made in accordance with GAAP consistently applied, reflecting all financial transactions of the Company and its Subsidiaries, and in which, for each fiscal year, all proper reserves for depreciation, depletion, obsolescence, amortization, taxes, bad debts and other purposes in connection with its business shall be made.

 

g. Amendments.  The Company will not and will not permit any Subsidiary to amend, modify or waive any term or provision of its certificate of formation, limited liability company agreement, certificate of incorporation, by-laws, partnership agreement or other applicable documents relating to its formation or governance, or any shareholders agreement, other than amendments, modifications and waivers that are not materially adverse in any respect to the Buyers and of which the Buyers have received at least five (5) Business Days’ prior written notice.

 

h. Other Agreements.  The Company shall not and shall cause its Subsidiaries, enter into any agreement the terms of which would restrict or impair the ability of the Company to perform its obligations under this Agreement and the Transaction Document.

 

  

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i. Disposition of Assets.  So long as any  Notes remains outstanding, neither the Company, nor any of its Subsidiaries shall sell, transfer or otherwise dispose of any of its material properties, assets and rights including, without limitation, its technology and intellectual property, to any person except for (i) sales to customers in the ordinary course of business (ii) sales or transfers between the Company, the Subsidiaries (iii) disposition of obsolete or worn out technology or equipment or (iiv) otherwise with the prior written consent of the holders of a majority of the  Notes then outstanding (the “Majority Holders”).

 

j. Reporting Status.  So long as a Buyer beneficially owns any of the Securities, the Company shall timely file all reports required to be filed with the Commission pursuant to the Exchange Act, and the Company shall not terminate its status as an issuer required to file reports under the Exchange Act even if the Exchange Act or the rules and regulations thereunder would permit such termination.

 

k. Disclosure of Transaction.  The Company shall file with the Commission, a Current Report on Form 8-K describing the material terms of the transactions contemplated hereby and all material non-public information disclosed to the Buyers prior to the filing as soon as practicable after the Closing but in no event later than 5:30 P.M. (EDT) on the fourth Business Day following the Closing.  In the event that the Company is unable to disclose specific non-public information in the Form 8-K, the Company shall include such information in its Form 10-Q for the interim period during which the Closing contemplated hereby occurs. “Business Day” means any day during which the NASDAQ (or other principal exchange) shall be open for trading.

 

l. Sarbanes-Oxley Act.  The Company shall be in compliance with the applicable provisions of the Sarbanes-Oxley Act of 2002, and the rules and regulations promulgated thereunder, as required under such Act.

 

m. No Integrated Offerings.  The Company shall not make any offers or sales of any security (other than the securities being offered or sold hereunder) under circumstances that would require registration of the securities being offered or sold hereunder under the Securities Act.

 

5. INDEMNITY.

 

a. General Indemnity.  The Company agrees to indemnify and hold harmless the Buyers (and their respective directors, officers, managers, partners, members, shareholders, affiliates, agents, successors and assigns) from and against any and all losses, liabilities, deficiencies, costs, damages and expenses (including, without limitation, reasonable attorneys’ fees, charges and disbursements) incurred by the Buyers as a result of any material breach of the material representations, warranties or covenants made by the Company herein. Each Buyer severally but not jointly agrees to indemnify and hold harmless the Company and its directors, officers, affiliates, agents, successors and assigns from and against any and all losses, liabilities, deficiencies, costs, damages and expenses (including, without limitation, reasonable attorneys’ fees, charges and disbursements) incurred by the Company as a result of any breach of the representations, warranties or covenants made by such Buyer herein. The maximum aggregate liability of each Buyer pursuant to its indemnification obligations under this Section 5 shall not exceed the portion of the Purchase Price paid by such Buyer hereunder. In no event shall any “Indemnified Party” (as defined below) be entitled to recover consequential or punitive damages resulting from a breach or violation of this Agreement.

 

b. Indemnification Procedure. Any party entitled to indemnification under this Section 5 (an “Indemnified Party”) will give written notice to the indemnifying party of any matters giving rise to a claim for indemnification; provided, that the failure of any party entitled to indemnification hereunder to give notice as provided herein shall not relieve the indemnifying party of its obligations under this Section 5 except to the extent that the indemnifying party is actually prejudiced by such failure to give notice. In case any action, proceeding or claim is brought against an Indemnified Party in respect of which indemnification is sought hereunder, the indemnifying party shall be entitled to participate in and, unless in the reasonable judgment of the Indemnified Party a conflict of interest between it and the indemnifying party may exist with respect of such action, proceeding or claim, to assume the defense thereof with counsel reasonably satisfactory to the Indemnified Party. In the event that the indemnifying party advises an Indemnified Party that it will contest such a claim for indemnification hereunder, or fails, within thirty (30) days of receipt of any indemnification notice to notify, in writing, such person of its election to defend, settle or compromise, at its

  

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sole cost and expense, any action, proceeding or claim (or discontinues its defense at any time after it commences such defense), then the Indemnified Party may, at its option, defend, settle or otherwise compromise or pay such action or claim. In any event, unless and until the indemnifying party elects in writing to assume and does so assume the defense of any such claim, proceeding or action, the Indemnified Party’s costs and expenses arising out of the defense, settlement or compromise of any such action, claim or proceeding shall be losses subject to indemnification hereunder. 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 fully apprised at all times as to the status of the defense or any settlement negotiations with respect thereto. If the indemnifying party elects to defend any such action or claim, then the Indemnified Party shall be entitled to participate in such defense with counsel of its choice at its sole cost and expense. The indemnifying party shall not be liable for any settlement of any action, claim or proceeding effected without its prior written consent, provided, however, that the indemnifying party shall be liable for any settlement if the indemnifying party is advised of the settlement but fails to respond to the settlement within thirty (30) days of receipt of such notification. Notwithstanding anything in this Section 5 to the contrary, the indemnifying party shall not, without the Indemnified Party’s prior written consent, settle or compromise any claim or consent to entry of any judgment in respect thereof which imposes any future obligation on the Indemnified Party or which does not include, as an unconditional term thereof, the giving by the claimant or the plaintiff to the Indemnified Party of a release from all liability in respect of such claim. The indemnity agreements contained herein shall be in addition to (a) any cause of action or similar rights of the Indemnified Party against the indemnifying party or others, and (b) any liabilities the indemnifying party may be subject to pursuant to the law.

 

6. CONDITIONS TO THE COMPANY’S OBLIGATION TO SELL.  The obligation of the Company hereunder to issue and sell the Notes and Warrants to a Buyer at the Closing is subject to the satisfaction, at or before the Closing Date of each of the following conditions thereto, provided that these conditions are for the Company’s sole benefit and may be waived by the Company at any time in its sole discretion:

 

a. The applicable Buyer shall have executed this Agreement and the Investor Information, as hereinafter defined.  “Investor Information” means all of the information each of the Buyers provide on the accredited investor certification and investor profile included after the Signature Page to this Agreement.

 

b. The applicable Buyer shall have delivered the Purchase Price in accordance with Section 1(b) above.

 

c. The representations and warranties of the applicable Buyer shall be true and correct in all material respects as of the date when made and as of the Closing Date as though made at that time (except for representations and warranties that speak as of a specific date), and the applicable Buyer shall have performed, satisfied and complied in all material respects with the covenants, agreements and conditions required by this Agreement to be performed, satisfied or complied with by the applicable Buyer at or prior to the Closing Date.

 

d. No litigation, statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated or endorsed by or in any court or governmental authority of competent jurisdiction or any self-regulatory organization having authority over the matters contemplated hereby which prohibits the consummation of any of the transactions contemplated by this Agreement.

 

7. CONDITIONS TO EACH BUYER’S OBLIGATION TO PURCHASE.  The obligation of each Buyer hereunder to purchase the Notes and Warrants at the Closing is subject to the satisfaction, at or before the Closing Date of each of the following conditions, provided that these conditions are for such Buyer’s sole benefit and may be waived by such Buyer at any time in its sole discretion:

 

  

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a. The Company shall have executed this Agreement and delivered the same to the Buyer.

 

b. The Company shall have delivered to such Buyer duly executed Notes (in such denominations as the Buyer shall request) and Warrants in accordance with Section 1(b) above.

 

c. The representations and warranties of the Company shall be true and correct in all material respects as of the date when made and as of the Closing Date as though made at such time (except for representations and warranties that speak as of a specific date) and the Company shall have performed, satisfied and complied in all material respects with the covenants, agreements and conditions required by this Agreement to be performed, satisfied or complied with by the Company at or prior to the Closing Date.

 

d. No litigation, statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated or endorsed by or in any court or governmental authority of competent jurisdiction or any self-regulatory organization having authority over the matters contemplated hereby which prohibits the consummation of any of the transactions contemplated by this Agreement.

 

e. No event shall have occurred which could reasonably be expected to have a Material Adverse Effect on the Company.

 

f. Secretary’s Certificate. The Company shall have delivered to such Buyer a secretary’s certificate, dated as of the Closing Date, certifying attached copies of (A) the Organizational Documents of the Company (B) the resolutions of the Company's Board approving this Agreement and the transactions contemplated hereby; and (D) the incumbency of each authorized officer of the Company signing this Agreement and the Transaction Documents and any other documents required to be executed or delivered in connection herewith and therewith.

 

g. Officer’s Certificate. The Company shall have delivered to the Buyers a certificate of an executive officer of the Company, dated as of the Closing Date, confirming the accuracy of the Company’s representations, warranties and covenants as of the Closing Date and confirming the compliance by the Company with the conditions precedent set forth in this Section 7 as of the Closing Date.

 

h. Stop Orders.  No stop order or suspension of trading shall have been imposed by the Commission or any other governmental or regulatory body having jurisdiction over the Company or the Trading Market(s) where the Common Stock is listed or quoted, with respect to public trading in the Common Stock.

 

8. GOVERNING LAW; MISCELLANEOUS.

 

a. Governing Law.  THIS AGREEMENT SHALL BE ENFORCED, GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED ENTIRELY WITHIN SUCH STATE, WITHOUT REGARD TO THE PRINCIPLES OF CONFLICT OF LAWS.  THE PARTIES HERETO HEREBY SUBMIT TO THE EXCLUSIVE JURISDICTION OF THE UNITED STATES FEDERAL COURTS LOCATED IN NEW YORK, NEW YORK WITH RESPECT TO ANY DISPUTE ARISING UNDER THIS AGREEMENT, THE AGREEMENTS ENTERED INTO IN CONNECTION HEREWITH OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY. BOTH PARTIES IRREVOCABLY WAIVE THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH SUIT OR PROCEEDING.  BOTH PARTIES FURTHER AGREE THAT SERVICE OF PROCESS UPON A PARTY MAILED BY FIRST CLASS MAIL SHALL BE DEEMED IN EVERY RESPECT EFFECTIVE SERVICE OF PROCESS UPON THE PARTY IN ANY SUCH SUIT OR PROCEEDING.  NOTHING HEREIN SHALL AFFECT EITHER PARTY’S RIGHT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW.  BOTH PARTIES AGREE THAT A FINAL NON-APPEALABLE JUDGMENT IN ANY SUCH SUIT OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON SUCH JUDGMENT OR IN ANY OTHER LAWFUL MANNER.  THE PARTY WHICH DOES NOT PREVAIL IN ANY DISPUTE ARISING UNDER THIS AGREEMENT SHALL BE RESPONSIBLE FOR ALL FEES AND EXPENSES, INCLUDING ATTORNEYS’ FEES, INCURRED BY THE PREVAILING PARTY IN CONNECTION WITH SUCH DISPUTE.

 

  

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b. Counterparts; Signatures by Facsimile.  This Agreement may be executed in one or more counterparts, each of which shall be deemed an original but all of which shall constitute one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to the other party.  This Agreement, once executed by a party, may be delivered to the other party hereto by facsimile transmission of a copy of this Agreement bearing the signature of the party so delivering this Agreement.

 

c. Headings.  The headings of this Agreement are for convenience of reference only and shall not form part of, or affect the interpretation of, this Agreement.

 

d. Severability.  In the event that any provision of this Agreement is invalid or unenforceable under any applicable statute or rule of law, then such provision shall be deemed inoperative to the extent that it may conflict therewith and shall be deemed modified to conform with such statute or rule of law.  Any provision hereof which may prove invalid or unenforceable under any law shall not affect the validity or enforceability of any other provision hereof.

 

e. Entire Agreement; Amendments.  This Agreement and the instruments referenced herein contain the entire understanding of the parties with respect to the matters covered herein and therein and, except as specifically set forth herein or therein, neither the Company nor the Buyer makes any representation, warranty, covenant or undertaking with respect to such matters.  No provision of this Agreement may be waived or amended other than by an instrument in writing signed by the party to be charged with enforcement.

 

f. Notices.  Any notices required or permitted to be given under the terms of this Agreement shall be sent by certified or registered mail (return receipt requested) or delivered personally or by courier (including a recognized overnight delivery service) or by facsimile or electronic mail and shall be effective five days after being placed in the mail, if mailed by regular United States mail, or upon receipt, if delivered personally or by courier (including a recognized overnight delivery service) or by facsimile, or upon confirmed receipt if delivered via electronic mail, in each case addressed to a party.  The addresses for such communications shall be:

 

	
If to the Company, to:

	
MEDITE Cancer Diagnostics, Inc.

	  	
4203 SW 34th Street

	  	
Orlando, FL 32811

	  	
Attention: Michaela Ott

	  	
Telephone: (407) 996-9630

	  	
Facsimile:  (407) 996-9631

 

	
With a copy to:

	
O’NEAL LAW OFFICE

Attn: William D. O’Neal

	  	
Scottsdale Road, Ste 9-715

Scottsdale, AZ 85251

	  	
Telephone: (480) 409-1146

	  	
Email: wdoneal@outlook.com

 

 

If to the Buyer(s), to the address set forth on the signature page, with a copy to (which shall not constitute notice) TriPoint Global Equities, c/o Hunter Taubman Fischer, LLC, 1450 Broadway, Floor 26, New York, New York 10018.  Each party shall provide notice to the other party of any change in address.

 

  

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g. Successors and Assigns.  This Agreement shall be binding upon and inure to the benefit of the parties and their successors and assigns.  Neither the Company nor any Buyer shall assign this Agreement or any rights or obligations hereunder without the prior written consent of the other.  Notwithstanding the foregoing, subject to Section 2(f), any Buyer may assign its rights hereunder to any person that purchases Securities in a private transaction from a Buyer or to any of its “affiliates,” as that term is defined under the 1934 Act, without the consent of the Company.

 

h. Third Party Beneficiaries.  This Agreement is intended for the benefit of the parties hereto and their respective permitted successors and assigns, and is not for the benefit of, nor may any provision hereof be enforced by, any other person.

 

i. Signature Page.  It is hereby agreed that the execution by a Buyer of this Agreement, in the place set forth herein, will constitute agreement to be bound by the terms and conditions hereof.  It is hereby agreed by the parties hereby that the execution by the Buyer of this Agreement, in the place set forth herein below, will be deemed and constitute the agreement by the Purchaser to be bound by all of the terms and conditions hereof, as well as by the Security and Pledge Agreement, the Notes, the Warrants and all of the other documents constituting the Transaction Documents and will be deemed and constitute the execution by the Buyer of all such Transaction Documents without requiring the Buyer’s separate signature on any of such Transaction Documents.

 

 

 

IN WITNESS WHEREOF, the parties hereto have caused this Securities Purchase Agreement to be duly executed by their respective authorized signatories as of the date first indicated above.

 

	
MEDITE CANCER DIAGNOSTICS, INC.

 

	  
	
By:_____________________________

     Name: Michaela Ott,

     Title:  Chief Executive Officer

 

 

	  
	  	  

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK

 

SIGNATURE PAGE FOR BUYER FOLLOWS]

  

-13-

  

 

MEDITE CANCER DIAGNOSTICS, INC.

 

BUYER SIGNATURE PAGE TO

 

PURCHASE AGREEMENT

 

 

Buyer hereby elects to purchase a total of $                      of Notes.

 

Date (NOTE: To be completed by the Buyer):                                        , 2016

 

 

If the Buyer is an INDIVIDUAL, and if purchased as JOINT TENANTS, as

 

TENANTS IN COMMON, or as COMMUNITY PROPERTY:

 

____________________________________               ___________________________

Print Name(s)                                                      Social Security Number(s)

 

____________________________________               ___________________________

Signature(s) of Buyer(s)                                   Signature

 

____________________________________               ___________________________

Date                                                                       Address

 

 

If the Buyer is a PARTNERSHIP, CORPORATION, LIMITED LIABILITY COMPANY or TRUST:

 

____________________________________              _____________________________

Name of Partnership,                                       Federal Taxpayer Corporation, LimitedIdentification Number Liability Company or Trust

 

 

By:   ________________________            ______________________________                                   

                             Name:                                                        State of Organization

 

Title:

 

________________________           _______________________________

Date                                                          Address

 

 

AGREED AND ACCEPTED:

 

MEDITE CANCER DIAGNOSTICS, INC.

 

By:

______________________                ________________

Name:                                                   Date

 

Title:

  

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MEDITE CANCER DIAGNOSTICS, INC.

 

ACCREDITED INVESTOR CERTIFICATION

 

For Individual Investors Only

 

(All individual investors must INITIAL where appropriate. Where there are joint investors both parties must INITIAL):

 

	
Initial _________

	
I certify that I have a “net worth” of at least $1 million either individually or through aggregating my individual holdings and those in which I have a joint, community property or other similar shared ownership interest with my spouse. For purposes hereof, “net worth” shall be deemed to include all of your assets, liquid or illiquid (excluding the value of your principal residence), minus all of your liabilities (excluding the amount of indebtedness secured by your principal residence up to its fair market value).

 

	
Initial _________

	
I certify that I have had an annual gross income for the past two

	
years of at least $200,000 (or $300,000 jointly with my spouse) and

	
expect my income (or joint income, as appropriate) to reach the same

	
level in the current year.

 

For Non-Individual Investors

 

(all Non-Individual Investors must INITIAL where appropriate):

 

	
Initial _________

	
The undersigned certifies that it is a partnership, corporation, limited liability company or business trust that is 100% owned by persons who meet either of the criteria for Individual Investors, above.

 

	
Initial _________

	
The undersigned certifies that it is a partnership, corporation, limited liability company or business trust that has total assets of at least $5,000,000 and was not formed for the purpose of investing in Company.

 

	
Initial _________

	
The undersigned certifies that it is an employee benefit plan whose investment decision is made by a plan fiduciary (as defined in ERISA §3(21)) that is a bank, savings  and  loan  association,  insurance  company  or  registered  investment adviser.

 

	
Initial _________

	
The undersigned certifies that it is an employee benefit plan whose total assets exceed $5,000,000 as of the date of the Purchase Agreement.

 

	
Initial _________

	
The undersigned certifies that it is a self-directed employee benefit plan whose investment decisions are made solely by persons who meet either of the criteria for Individual Investors, above.

  

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Initial _________

	
The undersigned certifies that it is a U.S. bank, U.S. savings and loan association or other similar U.S. institution acting in its individual or fiduciary capacity.

 

	
Initial _________

	
The undersigned certifies that it is a broker-dealer registered pursuant to §15 of the Securities Exchange Act of 1934.

 

	
Initial _________

	
The undersigned certifies that it is an organization described in §501(c)(3) of the Internal Revenue Code with total assets exceeding $5,000,000 and not formed for the specific purpose of investing in Company.

 

	
Initial _________

	
The undersigned certifies that it is a trust with total assets of at least $5,000,000, not formed for the specific purpose of investing in Company, and whose purchase is directed by a person with such knowledge and experience in financial and business matters that he is capable of evaluating the merits and risks of the prospective investment.

 

	
Initial _________

	
The undersigned certifies that it is a plan established and maintained by a state or its political subdivisions, or any agency or instrumentality thereof, for the benefit of its employees, and which has total assets in excess of $5,000,000.

 

	
Initial _________

	
The undersigned certifies that it is an insurance company as defined in §2(a)(13) of the Securities Act of 1933, as amended, or a registered investment company.

 

  

-16-

  

 

MEDITE CANCER DIAGNOSTICS, INC.

 

Investor Profile

 

(Must be completed by Buyer)

 

Section A - Personal Investor Information

 

 

Title in Which Securities Are to be Held: 

 

_____________________________________________________________________

 

Individual Executing Profile or Trustee:  

 

_____________________________________________________________________

 

Social Security Numbers / Federal I.D. Number: 

 

_____________________________________________________________________

 

Date of Birth: ________________________

 

Marital Status: ________________________

 

Joint Party Date of Birth: ________________________

 

Investment Experience (Years): ________________________

 

Annual Income: ________________________

 

Liquid Net Worth: ________________________

 

Net Worth: ________________________

 

 

	
Investment Objectives (circle one or more):

	
Long Term Capital Appreciation, Short Term 

Trading, Businessman’s Risk, Income, Safety of 

Principal, Tax Exempt Income or other

 

Home Street Address: 

 

 ______________________________________________

 

Home City, State & Zip Code: ________________________

 

Home Phone:  ________________________

 

Home Email: ________________________

  

-17-

  

 

Employer:                                                                                                        Home Fax:

 

_____________________________________________________________________

 

Employer Street Address:

 

_____________________________________________________________________

 

Employer City, State & Zip Code:

 

_____________________________________________________________________

 

Bus. Phone: ______________________________              Bus. Fax: ________________________    

 

Bus. Email: _______________________________

 

Type of Business:

 

 

 

  

-18-

  

 

MEDITE CANCER DIAGNOSTICS, INC.

 

Investor Profile

 

(Must be completed by Buyer)

 

Section B –  Entity Investor Information

 

 

Title in Which Securities Are to be  Held:  ______________________                                                                                                               

 

Authorized Individual Executing Profile or Trustee: ______________________

 

Social Security Numbers / Federal I.D. Number: ______________________

 

Investment Experience (Years): ______________________

 

Annual Income: ______________________

 

Net Worth: ______________________

 

Was the Trust formed for the specific purpose of purchasing the Common Stock? [  ] Yes  [ ] No

 

Principal Purpose (Trust)                                                                                               

 

Type of Business:    ______________________                                                         

 

 

	
Investment Objectives (circle one or more):

	
Long Term Capital Appreciation, Short Term Trading, Businessman’s Risk, Income, Safety of Principal, Tax Exempt Income or other

 

  

-19-

  

Street Address: ______________________

 

City, State & Zip Code: ______________________

 

Phone: ______________________

 

Email: ______________________

 

Fax: ______________________

 

  

-20-

  

 

Section C –  Form of Payment –  Check or Wire Transfer

 

__________  Check payable to “MEDITE CANCER DIAGNOSTICS, INC.” included with this Buyer Signature Page.

 

 

__________  Wire funds to:

 

 

MEDITE ENTERPRISE HOLDING ACCOUNT

 

Bank: BANK OF AMERICA

 

Bank Address: 4725 S Kirkman Road, Orlando FL 32811

 

Account Number:  8980621622486

 

Routing Number: 063000047

 

 

Section D –  Securities Delivery Instructions (check one)

 

 

__________ Please deliver my securities to the address listed in the above Investor Profile.

 

 

__________ Please deliver my securities to the below address:

 

    

                        ______________________________________

 

                        ______________________________________

  

-21-

  

 

SCHEDULES TO SECURITIES PURCHASE AGREEMENT

Schedule 3 (c)

 

Please see the attached schedule detailing 21,863,151 shares fully diluted outstanding after

conversion of preferred stock series B, C, and D and conversion of $650,000 of short term debt into equity at $.80 per shares.  Shares resulting from cashless warrants resulting from financing are included.  

 

Schedule 3 (h) Disclosure

All disclosures are contained in accordance with Securities Exchange Commission (SEC) reporting regulations and USA Generally Accepted Accounting Principles for the 3/31/16 financial statements filed with the SEC.

 

Schedule 3 (l) – No Undisclosed Liabilities

All material existing and expected liabilities are disclosed in accordance with Securities Exchange Commission (SEC) reporting regulations and USA Generally Accepted Accounting Principles for the 3/31/16 financial statements filed with the SEC.  

Schedule 3 (n) – Indebtedness

All material debt of $ 9.567 million is disclosed in accordance with Securities Exchange Commission (SEC) reporting regulations and USA Generally Accepted Accounting Principles for the 3/31/16 financial statements, notes 5 filed with the 3/31/16 SEC 10Q and notes 6 and 7 filed with the 12/31/15 SEC annual 10k report.

 

Schedule (o) – Title to Assets

The various American and German corporations have title to all assets, $18.482 million which are disclosed in accordance with Securities Exchange Commission (SEC) reporting regulations and USA Generally Accepted Accounting Principles for the 3/31/16 financial statements, note 4 filed with the SEC.  Some of these assets are either mortgaged or collateralized by various lenders related to the indebtedness of the company.

 

Schedule (p) – Actions Pending

All contingencies which are disclosed in accordance with Securities Exchange Commission

(SEC) reporting regulations and USA Generally Accepted Accounting Principles for the 3/31/16 financial statements, note 9 filed with the SEC.

 

Compliance 3(r) - Compliance  

Medite Cancer Diagnostics, Inc.  believes it is in compliance with regulations promulgated by the various USA and European governmental agencies applicable to Medite’s business and operations.

Schedule 3(u) - Taxes

All tax receivables and liabilities have been disclosed in accordance with Securities Exchange Commission (SEC) reporting regulations and USA Generally Accepted Accounting Principles for the 3/31/16 financial statements.

 

Schedule 3 (w) Books and Records Internal Accounting Controls

In accordance with Item 9 A of the Report 10k filed with the SEC in April 2016 for fiscal 12/31/15 (the “10K”), management believes the following has not changed through May 25, 2016.

 

Our internal control system was designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles in the U.S. Our internal control over financial reporting includes those policies and procedures that:

  

-22-

  

 

(i)           pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company;  

(ii)           provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with accounting principles generally accepted in the U.S., and that receipts and expenditures of the Company are being made only in accordance with authorization of our management and directors; and

(iii)           provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on our consolidated financial statements.

 

Please note that as stated in the 10K, our  management concluded that as of December 31, 2015, our disclosure controls and procedures were not effective to ensure (i) that information we are required to disclose in reports that we file or submit under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and (ii) that such information is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, in order to allow timely decisions regarding required disclosure.

 

Schedule (y) Transaction with Affiliates

All transactions with affiliates have been disclosed in accordance with Securities Exchange Commission (SEC) reporting regulations and USA Generally Accepted Accounting Principles for the 3/31/16 financial statements.

 

Schedule 3 (bb) – Employees

All paid and accrued employee wage and benefits have been disclosed in accordance with Securities Exchange Commission (SEC) reporting regulations and USA Generally Accepted Accounting Principles for the 3/31/16 financial statements.

 

 

-23-ex10-2.htm

EXHIBIT 10.2

 

Secured Promissory Note

 

THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAW, AND IT MAY NOT BE SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER SAID ACT OR STATE LAW OR AN EXEMPTION FROM SUCH REGISTRATION REQUIREMENTS; AND THE COMPANY MAY REQUIRE AN OPINION OF COUNSEL AS TO THE AVAILABILITY OF SUCH EXEMPTION.

 

 

	
No. SC-__

$_________

	  	
Orlando, Florida

Date: May __, 2016

 

 

MEDITE CANCER DIAGNOSTICS, INC.

 

15% SECURED CONVERTIBLE PROMISSORY NOTE

 

FOR VALUE RECEIVED, MEDITE CANCER DIAGNOSTICS, INC., a Delaware corporation (the “Company”), hereby promises to pay to the order of ______________ (“Holder”), the principal amount of ________________ Dollars ($__________) on the earlier of the third month anniversary of the Closing Date or the third business day following the Company’s receipt of funds exceeding $1,000,000 from an equity or debt financing (the “Additional Financing”), not including the financing contemplated by the Purchase Agreement (as defined below) (such earlier date being hereinafter referred to as the “Maturity Date”) or earlier as hereinafter provided.  Interest on the outstanding principal balance shall be paid quarterly, in arrears, at the rate of fifteen percent (15%) per annum.  Interest shall be computed on the basis of a 360-day year, using the number of days actually elapsed.  The Holder, at its sole election, may elect to have the interest accrued on this Note paid in shares of Common Stock, cash or a combination of both; provided however that any interest the Holder elects to have paid in shares of Common Stock, shall be paid at the rate of $.80 per share; provided further that if the Holder elects to have any accrued interest paid in shares of Common Stock, it must provide written notice to the Company at least five (5) Business Days prior to the interest payment due date and such notice must clearly state the amount of interest such Holder elects to be paid in shares of Common Stock.

 

ARTICLE 1.

Agreements

 

(a)      Securities Purchase Agreement.  This Note has been issued pursuant to the terms and conditions set forth in the Securities Purchase Agreement dated as of May __, 2016, by and among the Company and the Holder, (as from time to time amended, the “Purchase Agreement”).  All of the terms and conditions of such Purchase Agreement are incorporated herein by this reference, and all capitalized terms not separately defined in this Note, shall have the same meanings as defined in the Purchase Agreement.

 

(b)      Security Agreement.  Pursuant to that certain Security Agreement dated as of

 

May __, 2016, by and among the Company and the Holders (the “Security Agreement”), the amounts owed under this Note are secured by a security interest as set forth in the Security Agreement.

 

  

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ARTICLE 2.

Conversion

 

This Note may be converted into Units issued pursuant to the Company’s private financing of up to $5,000,000 (the “Follow On Offering”) Units at a price of $.80/Unit (the “Units”) consisting of: (i) a  2 year unsecured convertible note (the “Follow On Note”), which converts into shares of Common Stock at an initial conversion price of $.80 per share and (ii) a warrant to purchase one half additional share of Common Stock, with an initial exercise price equal to $.80 per share (the “Follow On Warrant”), in accordance with this Article 2.

 

(a)      Conversion by the Holder.  At any time prior to the Maturity Date, the Holder shall have the right to convert the unpaid principal and accrued interest owing under this Note (collectively, the “Note Balance”), in whole or in part, into Units. The number of Units that Holder shall be entitled to receive, and shall receive, upon such conversion shall be determined by dividing the Note Balance by $.80 (the “Conversion Price”), with interest computed as of the Voluntary Conversion Date (defined below).  The Holder’s election to convert this Note, in whole or in part, shall be irrevocable.  The Holder shall receive the securities underlying the Units on the same terms and conditions as the investors in the Follow On Offering.  For illustrative purposes only, if the Note Balance is $50,000, upon conversion of the Note, the Holder shall receive 62,500 Units, which shall consist of a $50,000 Follow On Note convertible into up to 62,500 shares of Common Stock and a Follow On Warrant to purchase up to 25,000 shares of Common Stock.

 

(b)      Conversion Procedure.  The Holder shall exercise its right of conversion by forwarding the original Note, together with a Notice of Conversion, in the form attached hereto as Exhibit A, signed by the Holder, to the Company to notify the Company that the Holder is exercising its right to convert all or part of the unpaid principal and accrued interest due under this Note into Units.  The effective date of the conversion pursuant to this Article 2(b) shall be the date the Company receives the Notice of Conversion or the original Note (or if the original Note has been lost or destroyed, an affidavit of Holder certifying to such loss or destruction), whichever is later (such later date, being referred to herein as the “Voluntary Conversion Date”).  Within three (3) business days of the Voluntary Conversion Date (such 3rd date being referred to as the “Deadline”), the Company shall issue and deliver, or cause to be issued and delivered to the Holder, the Units due to the Holder.

(c)      Partial Conversion.  If the Holder elects to convert only a portion of the unpaid principal and accrued interest owing under this Note, the Company shall issue and deliver a new note of like tenor for the remaining unpaid principal and accrued interest of this Note.  The Holder and the Company shall maintain records showing the principal and interest so converted and the dates of such conversions.

(d)      Stock Certificates.  Upon conversion of this Note, the Company shall issue and deliver to Holder, or to Holder’s nominee or nominees, the Follow On Note and Follow On Warrant representing the number of such securities to which Holder shall be entitled as a result of conversion as provided herein.  The Follow On Note and Follow On Warrant shall bear the following legend:

“THE SECURITIES REPRESENTED BY THIS [NOTE OR WARRANT, AS APPLICABLE] HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE SOLD, TRANSFERRED, HYPOTHECATED OR OTHERWISE ASSIGNED EXCEPT PURSUANT TO A REGISTRATION STATEMENT WITH RESPECT TO SUCH SECURITIES WHICH IS EFFECTIVE UNDER SUCH ACT AND UNDER ANY APPLICABLE STATE SECURITIES LAWS UNLESS, IN THE OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY, AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF SUCH ACT AND STATE SECURITIES LAWS IS AVAILABLE.”

  

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(e)      Adjustments on Conversion Amount. Until the earlier of: (i) the end of the twelfth (12th) month following the Issue Date or (ii) the completion of the Follow On Offering, the number of shares of Common Stock to be issued upon each conversion of the Holder’s Note shall be subject to adjustments as follows:

 

(i)           Adjustment for Stock Splits and Combinations. If the Company, at any time while this Note is outstanding: (A) pays a stock dividend or otherwise makes a distribution or distributions in shares of its common stock or any other equity or equity equivalent securities payable in shares of common stock, (B) subdivides outstanding shares of common stock into a larger number of shares, (C) combines (including by way of reverse stock split) outstanding shares of common stock into a smaller number of shares, or (D) issues by reclassification of shares of the common stock any shares of capital stock of the Company, then the Conversion Price shall be multiplied by a fraction of which the numerator shall be the number of shares of common stock (excluding treasury shares, if any) outstanding before such event and of which the denominator shall be the number of shares of common stock outstanding after such event.  Any adjustment made pursuant to this section shall become effective immediately after the record date for the determination of stockholders entitled to receive such dividend or distribution and shall become effective immediately after the effective date in the case of a subdivision, combination or re classification.

 

(ii)           Consolidation, Merger or Sale.  In case of any consolidation of the Company with, or merger of the Company into any other corporation, or in case of any sale or conveyance of all or substantially all of the assets of the Company other than in connection with a plan of complete liquidation of the Company, then as a condition of such consolidation, merger or sale or conveyance, adequate provision will be made whereby the holder of this Note will have the right to acquire and receive upon conversion of this Note in lieu of the Units immediately theretofore acquirable upon the conversion of this Note, such shares of stock, securities or assets as may be issued or payable with respect to or in exchange for the number of Units immediately theretofore acquirable and receivable upon conversion of this Note had such consolidation, merger or sale or conveyance not taken place.  In any such case, the Company will make appropriate provision to insure that the provisions of this paragaraph will thereafter be applicable as nearly as may be in relation to any shares of stock or securities thereafter deliverable upon the conversion of this Note.  The Company will not affect any consolidation, merger or sale or conveyance unless prior to the consummation thereof, the successor corporation (if other than the Company) assumes by written instrument the obligations under this paragraph and the obligations to deliver to the holder of this Note such shares of stock, securities or assets as, in accordance with the foregoing provisions, the holder may be entitled to acquire.

 

(iii)           Notice of Adjustment.  Promptly after adjustment of the Conversion Price or any increase or decrease in the number of shares purchasable upon the conversion of the Note, the Company shall give written notice in accordance with Article 3(e).  The notice shall be signed by an authorized officer of the Company and shall state the effective date of the adjustment and the Conversion Price resulting from such adjustment and the increase or decrease, if any, in the number of shares purchasable at such price upon any conversion of the Note, setting forth in reasonable detail the method of calculation and the facts upon which such calculation is based.

 

(iv)           Other Notices.  In the event that the Company shall propose at any time: (a) to declare any dividend or distribution upon any class or series of capital stock, whether in cash, property, stock or other securities (including, without limitation, pursuant to a split or subdivision of the outstanding shares of capital stock); (b) to effect any reclassification or recapitalization of its capital stock outstanding involving a change in the capital stock; or (c) to merge or consolidate with or into any other corporation, or to sell, lease or convey all or substantially all of its property or business, or to liquidate, dissolve or wind up; then, in connection with each such event, the Company shall mail to the Note Holder notice of such transaction:

 

	
  

	
1.

	
at least five (5) business days’ prior written notice in accordance with Article 3(e) of the date on which a record shall be taken for such dividend or distribution (and specifying the date on which the holder of the affected class or series of capital stock shall be entitled thereto) or for determining the rights to vote, if any, in respect of the matters referred to in (iv)(b) and (iv)(c) above; and

 

  

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2.

	
in the case of the matters referred to in (iv)(b) and (iv)(c) above, written notice of such impending transaction not later than ten (10) business days’ prior to any shareholders’ meeting called to approve such transaction, or ten (10) business days’ prior to the closing of such transaction, whichever is earlier, and shall also notify the Note Holder in writing in accordance with Article 3(e) of the final approval of such transaction by the stockholders of the Company (if such approval is required).  The first of such notices shall describe the terms and conditions of the impending transaction that are material to a holder of Common Stock (as determined by the Board of Directors of the Company (the “Board”) in good faith) and specify the date on which a holder of Common Stock shall be entitled to exchange his, her or its Common Stock for securities or other property deliverable upon the occurrence of such event) and the Company shall thereafter give such holder prompt notice of any changes in such terms or conditions that are material to a holder of Common Stock (as determined by the Board in good faith).  The Company acknowledges that any record date must be set at a date that would permit the Note Holder effectively to exercise its rights hereunder.

 

(f)      Effect of Conversion.  Upon conversion of this Note in full in the manner provided by this Article 2, this Note shall be deemed fully satisfied and cancelled.

 

(g)      Authorized Shares.  The Company covenants that while the Notes are outstanding, the Company will reserve from its authorized and unissued common stock, free from preemptive rights, to provide for the issuance of 100% of the number of shares of common stock upon the full conversion of the Follow On Notes and Follow On Warrants (the “Reserved Amount”).  If the Company shall issue any securities or make any change to its capital structure which would change the number of shares of Common Stock into which the Follow On Notes or Follow On Warrants shall be convertible or exercisable, respectively at the then current conversion price and exercise price, respectively thereof, the Company shall at the same time make proper provision so that thereafter there shall be a sufficient number of shares of Common Stock authorized and reserved, free from preemptive rights, for conversion of the outstanding Follow On Notes and exercise of the outstanding Follow On Warrants.  The Company (i) acknowledges that it has irrevocably authorized by its Board of Directors to issue the Units, and (ii) agrees that its issuance of the Holder’s Note shall constitute full authority to its officers and agents who are charged with the duty of executing stock certificates to execute and issue the necessary certificates for the securities underlying the Units in accordance with the terms and conditions of the Holder’s Note.

 

(h)           Pro Rata Conversion; Disputes.  In the event that the Company receives a Conversion Notice from more than one holder of Notes for the same Conversion Date and the Company can convert some, but not all, of such portions of the Notes submitted for conversion, the Company shall convert from each holder of Notes electing to have Notes converted on such date a pro rata amount of such holder’s portion of its Notes submitted for conversion based on the principal amount of Notes submitted for conversion on such date by such holder relative to the aggregate principal amount of all Notes submitted for conversion on such date.  In the event of a dispute as to the number of Units issuable to the Holder in connection with a conversion of this Note, the Company shall issue to the Holder the number of Units not in dispute and resolve such dispute in accordance with Article 2(i) below.

  

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(h)      Dispute Resolution.  In the case of a dispute as to the arithmetic calculation of the Conversion Price or number of Units to be issued (the “Conversion Amount”), the Company shall submit the disputed determinations or arithmetic calculations via facsimile within one (1) Business Day of receipt, or deemed receipt, of the Conversion Notice or other event giving rise to such dispute, as the case may be, to the Holder.  If the Holder and the Company are unable to agree upon such determination or calculation within one (1) Business Day of such disputed determination or arithmetic calculation being submitted to the Holder, then the Company shall, within one Business Day submit via facsimile the disputed arithmetic calculation of the Conversion Price or Conversion Amount to the Company’s independent, outside accountant.  The Company shall cause the accountant to perform the determinations or calculations and notify the Company and the Holder of the results no later than five (5) Business Days from the time it receives the disputed determinations or calculations. Such accountant’s determination or calculation shall be binding upon all parties absent demonstrable error.  The party whose calculation is furthest from the accountant’s determination or calculation, shall be obligated to pay the fees and expenses of such accountant.

 

ARTICLE 3.

 

Events of Default and Acceleration

 

(a)      Events of Default Defined.  The entire unpaid principal amount of this Note, together with interest thereon shall forthwith become and be due and payable if any one or more the following events (“Events of Default”) shall have occurred (for any reason whatsoever and whether such happening shall be voluntary or involuntary or be affected or come about by operation of law pursuant to or in compliance with any judgment, decree, or order of any court or any order, rule or regulation of any administrative or governmental body) and be continuing.  An Event of Default shall occur:

 

(i)           if failure shall be made in the payment of the principal of this Note or in the payment of any installment of interest on this Note when and as the same shall become due and such failure shall continue for a period of five (5) business days after such payment is due; or

 

(ii)           the Company’s (A) failure to issue the Units by the Deadline or (B) notice, written or oral, to any holder of the Notes, including by way of public announcement or through any of its agents, at any time, of its intention not to comply with a request for conversion of any Notes into Units that is tendered in accordance with the provisions of the Notes;

(iii)           At any time following the tenth (10th) consecutive Trading Day that the Reserved Amount is less than the number of shares of Common Stock that the Holder would be entitled to receive upon full conversion of the Follow On Notes or full exercise of the Follow On Warrants (without regard to any limitations on conversion set forth herein or otherwise);

 

(iv)           the Company defaults in the performance of or compliance with its obligations under any of this Note, the Purchase Agreement or any of the Transaction Documents and such default has not been cured for thirty (30) days after written notice of default is given to the Company; or

 

(v)           any representation or warranty made by or on behalf of the Company in this Note, the Purchase Agreement or any of the Transaction Documents proves to have been false or incorrect in any material respect on the date as of which made, and such condition has not been cured for sixty (60) business days after written notice of default is given to the other party;

  

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(vi)           if the Company shall consent to the appointment of a receiver, trustee or liquidator of itself or of a substantial part of its property, or shall admit in writing its inability to pay its debts generally as they become due, or shall make a general assignment for the benefit of creditors, or shall file a voluntary petition in bankruptcy, or an answer seeking reorganization in a proceeding under any bankruptcy law (as now or hereafter in effect) or an answer admitting the material allegations of a petition filed against the Company in any such proceeding, or shall by voluntary petition, answer or consent, seek relief under the provisions of any other now existing or future bankruptcy or other similar law providing for the reorganization or winding up of corporations, or an arrangement, composition, extension or adjustment with its or their creditors, or shall, in a petition in bankruptcy filed against it or them be adjudicated a bankrupt, or the Company or its directors or a majority of its stockholders shall vote to dissolve or liquidate the Company; or

 

(vii)           if an involuntary petition shall be filed against the Company seeking relief against the Company under any now existing or future bankruptcy, insolvency or other similar law providing for the reorganization or winding up of corporations, or an arrangement, composition, extension or adjustment with its or their creditors, and such petition shall not be stayed or vacated or set aside within ninety (90) days from the filing thereof; or

 

(viii)           if a court of competent jurisdiction shall enter an order, judgment or decree appointing, without consent of the Company, a receiver, trustee or liquidator of the Company or of all or any substantial part of the property of the Company, or approving a petition filed against the Company seeking a reorganization or arrangement of the Company under the Federal bankruptcy laws or any other applicable law or statute of the United States of America or any State thereof, or any substantial part of the property of the Company shall be sequestered; and such order, judgment or decree shall not be stayed or vacated or set aside within ninety (90) days from the date of the entry thereof.

 

(b)      Remedies Following An Event Of Default.  Upon occurrence of an Event of Default defined in subsection (a) of this Article 2, this Note and all accrued Interest to the date of such default shall, at the option of the Holder, immediately become due and payable without presentment, protest or notice of any kind, all of which are waived by the Company; provided further that upon an Event of Default, the Company shall issue the Holder warrants in amount equal to 10% of the then outstanding principal amount of this Note per month, until such default is cured.

 

(c)      Rights of the Holder.  Nothing in this Note shall be construed to modify, amend or limit in any way the right of the Holder to bring an action against the Company.

 

ARTICLE 4.

 

	
1.

	
Miscellaneous

 

(a)      Prepayments and Partial Payments.  The Company may prepay this Note in whole or in part at anytime; provided, that any partial payment of principal shall be accompanied by payment of accrued interest to the date of prepayment.  Any payment made to the holders of the Notes which is not a full payment of all principal and interest on all of the Notes shall be made pro rata to the holders of the Notes based on the respective principal amounts of the Notes.

 

(b)      Transferability.  This Note shall not be transferred except in a transaction exempt from registration pursuant to the Securities Act and applicable state securities law.  The Company shall treat as the owner of this Note the person shown as the owner on its books and records.  The term “Holder” shall include the initial holder named on the first page of this Note and any subsequent holder of this Note.

 

(c)      WAIVER OF TRIAL BY JURY.  IN ANY LEGAL PROCEEDING TO ENFORCE PAYMENT OF THIS NOTE, THE COMPANY WAIVES TRIAL BY JURY.

  

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(d)      Usury Saving Provision.  All payment obligations arising under this Note are subject to the express condition that at no time shall the Company be obligated or required to pay interest at a rate which could subject the holder of this Note to either civil or criminal liability as a result of being in excess of the maximum rate which the Company is permitted by law to contract or agree to pay.  If by the terms of this Note, the Company is at any time required or obligated to pay interest at a rate in excess of such maximum rate, the applicable rate of interest shall be deemed to be immediately reduced to such maximum rate, and interest thus payable shall be computed at such maximum rate, and the portion of all prior interest payments in excess of such maximum rate shall be applied and shall be deemed to have been payments in reduction of principal.

 

(e)      Notice to Company.  Any notice(s) given under this Note shall be given on the same terms and conditions set forth in Section 8(f) of the Purchase Agreement.

 

(f)      Governing Law.  This Note shall be governed by the laws of the State of New York applicable to agreements executed and to be performed wholly within such State.  The Company hereby (i) consents to the non-exclusive jurisdiction of the United States District Court sitting in New York, New York in any action relating to or arising out of this Note, (ii) agrees that any process in any such action may be served upon it, in addition to any other method of service permitted by law, by certified or registered mail, return receipt requested, or by an overnight courier service which obtains evidence of delivery, with the same full force and effect as if personally served upon him and (iii) waives any claim that the jurisdiction of any such tribunal is not a convenient forum for any such action and any defense of lack of in personam jurisdiction with respect thereto.

 

(g)      Expenses.  In the event that the Holder commences a legal proceeding in order to enforce its rights under this Note, the Company shall pay all reasonable legal fees and expenses incurred by the Holder with respect thereto, if the Holder is successful in enforcing such action.

 

IN WITNESS WHEREOF, the Company has executed this Note as of the date and year first aforesaid.

 

MEDITE CANCER DIAGNOSTICS, INC.

 

 

By:__________________________________

 

Name: Michaela Ott, Chief Executive Officer

  

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EXHIBIT A

 

CONVERSION NOTICE

 

 

	
MEDITE Cancer Diagnostics, Inc.

	
4203 SW 34th Street

	
Orlando, FL 32811

	
Attention: Michaela Ott

 

This Notice (the “Notice”) is being provided to inform MEDITE Cancer Diagnostics, Inc. (the “Company”), that the undersigned (the “Holder”) irrevocably elects to convert the unpaid principal and accrued interest set forth below owed by the Company under the Secured Convertible Note dated [  ] (the “Note”), into Units as provided in Article 2 of the Note.  The conversion shall be effective as of the Voluntary Conversion Date, as defined in the Note.

 

The number of Units to which the Holder shall be entitled to receive shall be determined by dividing (i) the amount of unpaid principal and accrued interest that the Holder hereby elects to convert, as set forth below, by (ii) the Conversion Price as provided in Article 2 of the Note.  The Holder shall receive a Follow On Note and Follow On Warrant, as such terms are defined in Article 2 of the Note, representing the number of such securities due to the Holder upon conversion.

 

Effective as of the Voluntary Conversion Date, subject to the Company’s receipt of the original Note, the Note is cancelled and terminated only as to the amount of principal and accrued interest set forth below. If the Holder has elected to convert only a portion of the unpaid principal and accrued interest due under the Note, the Company shall issue and deliver, or cause to be issued and delivered to the Holder, a new note of like tenor for the remaining unpaid principal and accrued interest of the Note.

 

 

	
Date:________________

	___________________________________
	  	
Signature

	  	  
	  	___________________________________
	
Print Name

 

	  	
Address:

	  	
_____________________________________

	  	
_____________________________________

	  	
_____________________________________

	
Principal to be converted: $______________________________

	
$____________________________

	
Accrued interest to be converted: $________________________

	
$____________________________

	
Conversion Price: $____________________________________

	
$_____________________________

	
Amount of Follow On Notes to be issued:  $__________________________________________

 

	
$_____________________________

	
Amount of Follow On Warrants to be issued:

	
_____________________________

 

 

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