Document:

Exhibit

Exhibit 10.6
CONFIDENTIAL TREATMENT REQUESTED BY XPEL, INC.
PURSUANT TO 17 C.F.R. SECTION 200.83

STOCK OPTION PLAN 
XPEL INC.
1.           PURPOSE:  The  purpose  of  this  stock  option  plan  (the  “Plan”)  of  XPEL  Inc.  (“XPEL”  or  the “Company”) is to encourage common stock ownership in the Company by directors, officers, employees and consultants of the Company or any Affiliate (as that term is defined in the Securities Act (Ontario)) (hereinafter referred to as “Optionees”) who are primarily responsible for the management and profitable growth of its business and to advance the interests of the Company by providing additional incentive for superior performance by such persons and to enable the Company to attract and retain valued directors, officers, employees and consultants by granting options (the “Options” or “Option”) to purchase common shares of the Company (“Common Shares”) on the terms and conditions set forth in this Plan and any stock option agreements entered into between the Company and the Optionees (“Option Agreements”) in accordance with the Plan.
2.           ADMINISTRATION: The Plan shall be administered by the Board of Directors of the Company, or by a special committee of the directors appointed from time to time by the Board of Directors of XPEL (such committee or, if no such committee is appointed, the Board of Directors of XPEL, is the “Board”). No Member of the Board shall, by virtue of such appointment, be disentitled or ineligible to receive Options under this Plan. Subject to the provisions of the Plan, the Board shall have full authority to interpret the Plan and all Option Agreements entered into thereunder, and to make or rescind such rules and regulations and establish such procedures as it deems appropriate for the administration of the Plan. All determinations and interpretations of the Board shall be binding and conclusive. Each Option granted pursuant to this Plan shall be evidenced by an Option Agreement in writing, signed on behalf of XPEL and by the Optionee, in such form as the Board shall approve. Each such Option Agreement shall recite that it is subject to the provisions of this Plan.
3.           STOCK EXCHANGE RULES: All Options granted pursuant to this Plan shall be subject to the rules and policies of any stock exchange(s) or exchange(s) upon which the Common Shares are then listed and any other regulatory body having jurisdiction (collectively, the “Exchange”).
4.           SHARES SUBJECT TO OPTIONS: Subject to adjustment in accordance with the provisions of this Plan, the securities to be offered under this Plan shall consist of Common Shares. The Board will make available that number of Common Shares for the purpose of the Plan that it considers appropriate except that the number of Common Shares that may be issued pursuant to the exercise of all Options under the Plan and under any other stock options of the Company shall not exceed 10% of the Common Shares issued and outstanding (on a non-diluted basis) at any time and from time to time. In the event that Options granted under the Plan, and under any other stock options of the Company which may be in effect at a particular time, are surrendered, terminate or expire without being exercised in whole or in part, the Common Shares subject thereto shall again be available for the purpose of this Plan.
5.           MAINTENANCE OF SUFFICIENT CAPITAL: XPEL shall at all times during the term of the Plan reserve and keep available such numbers of Common Shares as will be sufficient to satisfy the requirements of the Plan.
6.           PARTICIPATION: Directors, officers, consultants, and employees of XPEL or its Affiliates, and employees of a person or company which provides management services to XPEL or its Affiliates (“Management Company Employees”) shall  be  eligible  for  selection to  participate in  the  Plan  (such  persons hereinafter collectively referred to as “Participants”). Subject to compliance with applicable requirements of the Exchange, Participants may elect to hold Options granted to them in an incorporated entity wholly owned by them and such entity shall be bound by the Plan in the same manner as if the options were held by the Participant.
Subject to the terms hereof, the Board shall determine to whom Options shall be granted, the terms and provisions of the respective Option Agreements, the time or times at which such Options shall be granted and vested, and the number of Common Shares to be subject to each Option. In the case of employees or consultants of XPEL or its Affiliates, or Management Company Employees, the Option Agreements to which they are party must contain a representation of Mart that such employee, consultant or Management Company Employee, as the case may be, is a bona fide employee, consultant or Management Company Employee of XPEL or its Affiliate.A Participant who 

CONFIDENTIAL TREATMENT REQUESTED BY XPEL, INC. 
PURSUANT TO 17 C.F.R. SECTION 200.83

has been granted an Option may, if such Participant is otherwise eligible, and if permitted under the policies of the Exchange, be granted an additional Option or Options if the Board shall so determine.
7.           TERMS AND CONDITIONS OF OPTIONS: The terms and conditions of each Option granted under the Plan shall be set forth in written Option Agreements between the Company and the Optionee. Such terms and conditions shall include the following as well as other such provisions, not inconsistent with the Plan, as may be deemed advisable by the Board:
(a)          Number of Shares subject to Option to any one Optionee: The number of shares subject to an Option shall be determined from time to time by the Board, but no one Participant shall be granted an Option which exceeds the maximum number permitted by the Exchange. No single Participant shall be granted Options to purchase a number of Common Shares equaling more than 5% of the issued and outstanding Common Shares of the Company (on a non-diluted basis) in any 12-month period, unless the Corporation has obtained disinterested shareholders’ approval in respect of such grant and meets applicable Exchange requirements. The aggregate number of Options granted to any one Consultant in any 12-month period shall not exceed 2% of the issued and outstanding Common Shares of the Company (on a non-diluted basis). The aggregate number of Options granted to all persons retained to provide investor relations activities in any 12- month period shall not exceed 2% of the issued and outstanding Common Shares of the Company (on a non- diluted basis) and such Options shall vest in stages over a period of not less than 12 months with no more than 1/4 of the Options vesting in any 3 month period.
(b)          Exercise Price: The exercise price of any Common Shares in respect of which an Option may be granted under the Plan shall be determined by the Board, subject to Exchange approval at the time the Option is granted. In no event shall such exercise price be lower than the exercise price permitted by the Exchange. The exercise price of Options held by insiders of the Corporation may not be reduced, unless the Corporation has obtained disinterested shareholders’ approval in respect of the same and meets applicable Exchange requirements.
(c)          Payment: The full purchase price of the Common Shares purchased under the Option shall be paid in cash upon the exercise thereof. A holder of an Option shall have none of the rights of a stockholder until the Common Shares are issued to him. All Common Shares issued pursuant to the exercise of Options granted or deemed to be granted under the Plan, will be so issued as fully paid and non-assessable Common Shares. No Optionee or his legal representatives, legatees or distributees will be, or will be deemed to be, a holder of any Common Shares subject to an Option under this Plan, unless and until certificates for such Common Shares are issued to him or them under the terms of the Plan.
(d)          Term of Options: Each Option and all rights thereunder shall be expressed to expire on the date set out in the Option Agreement and shall be subject to earlier termination as provided in subparagraph (f) provided that the maximum term of any Option may not exceed 10 years.
(e)          Exercise of Options: The exercise of any Option will be contingent upon receipt by the Company at its head office of a written notice of exercise, specifying the number of Common Shares with respect to which the Option is being exercised, accompanied by cash payment, certified cheque or bank draft for the full purchase price of such Common Shares with respect to which the Option is exercised. An Option may be exercised in full or in part during any year of the term of the Option as provided in the written Option Agreement; provided however that except as expressly provided herein or as provided in any valid Option Agreement approved by the Board, no Option may be exercised unless that Optionee is then a director, officer, consultant or employee of the Company or its Affiliates, or a Management Company Employee of the Company or its Affiliates. This Plan shall not confer upon the Optionee any right with respect to continuance as a Director, officer, employee, consultant or Management Company Employee of the Company or any Affiliate.
(f)          Termination of Options: Any Option granted pursuant hereto, to the extent not validly exercised, and save as expressly otherwise provided herein, will terminate on the earlier of the following dates:
(i)           The date of expiration specified in the Option Agreement, being not more than ten (10)

CONFIDENTIAL TREATMENT REQUESTED BY XPEL, INC. 
PURSUANT TO 17 C.F.R. SECTION 200.83

years after the date the Option was granted;
(ii)          Three (3) months after the date the Optionee shall cease to be a director, officer, consultant or employee of the Corporation or its Affiliates, or ceases to be Management Company Employee, for any reason (other than death), and only to the extent the Optionee was entitled to exercise it at the date of such cessation, unless such Optionee was engaged in investor relations activities, in which case such exercise must occur within 30 days after the cessation of the Optionee’s services to the Company or its Affiliate; or
(iii)         One (1) year after the date of the Optionee’s death during which period the Option may be exercised only by the Optionee’s legal representative or the person or persons to whom the deceased Optionee’s rights under the Option shall pass by will or the applicable laws of descent and distribution, and only to the extent the Optionee would have been entitled to exercise it at the time of his death if the employment of the Optionee had been terminated by the Company on such date;
Notwithstanding the foregoing, in the event that the expiry date of an option occurs during a blackout period that is self-imposed by XPEL pursuant to its policies (“Blackout Period”), the expiry date of such Option shall be automatically extended for a period of 10 business days following the end of the Blackout Period.
(g)          Non-transferability of Options: No Option shall be transferable or assignable by the Optionee other than by the laws of descent and distribution and shall be exercisable during his lifetime only by him.
(h)          Applicable Laws or Regulations: The Company’s obligation to sell and deliver stock under each Option is subject to such compliance by the Company and any Optionee as the Company deems necessary or advisable with all laws, rules and regulations of Canada and the United States of America and any Provinces and/or States thereof applying to the authorization, issuance, listing or sale of securities and is also subject to the acceptance for listing of the Common Shares which may be issued in exercise thereof by each stock exchange upon which the shares of the Company are listed for trading.
8.           ADJUSTMENT IN EVENT OF CHANGE IN STOCK: Each Option shall contain uniform provisions in such form as may be approved by the Board to appropriately adjust the number and kind of securities covered by the Option and the exercise price of Common Shares subject to the Option in the event of a declaration of stock dividends, or stock subdivisions or consolidations or reconstruction or reorganization or recapitalization of the Company or other relevant changes in the Company’s capitalization (other than issuance of additional shares) to prevent substantial dilution or enlargement of the rights granted to the Optionee by such Option, and the Option Price thereof shall be adjusted appropriately by the Board and such adjustment shall be effective and binding for all purposes of the Plan.
9.           AMALGAMATION, CONSOLIDATION OR MERGER: If the Company amalgamates, consolidates or merges with or into another corporation, which it reserves the right to do, any Common Shares receivable on the exercise of an Option granted under the Plan shall be converted into the securities, property or cash which the Optionee would have received upon such amalgamation, consolidation or merger if the Optionee had exercised his Option immediately prior to the record date applicable to such amalgamation, consolidation or merger, and the Option Price shall be adjusted appropriately by the Board and such adjustment shall be binding for all purposes of the Plan.
10.           APPROVALS: The obligation of the Company to issue and deliver the Common Shares in accordance with the Plan is subject to any approvals which may be required from the shareholders of the Company and any regulatory authority or stock exchange having jurisdiction over the securities of the Company. If any Common Shares cannot be issued to any Optionee for whatever reason, the obligation of the Company to issue such Common Shares shall terminate and any Option exercise price paid to the Company will be returned to the Optionee.
11.           AMENDMENT AND DISCONTINUANCE OF PLAN: Subject to regulatory approval, including approval of the Exchange, the Board may from time to time amend or revise the terms of the Plan or may discontinue 

CONFIDENTIAL TREATMENT REQUESTED BY XPEL, INC. 
PURSUANT TO 17 C.F.R. SECTION 200.83

the Plan at any time provided however that no such right may, without the consent of the Optionee, in any manner adversely affect his rights under any Option theretofore granted under the Plan.
EFFECTIVE DATE AND DURATION OF PLAN: The Plan shall remain in full force and effect from the date of shareholder approval hereof and from year to year thereafter until amended or terminated in accordance with Paragraph 11 hereof and for so long thereafter as Options remain outstanding in favour of any Optioneebicx_ex101.htm

EXHIBIT 10.1
   
 COVER SHEET WITH SUBSCRIPTION AND ROYALTY AGREEMENT INSTRUCTIONS
  
 Enclosed herewith are the documents necessary to subscribe for shares of common stock (the “Securities”) of BioCorRx Inc., a corporation organized under the laws of Nevada (the “Company”). Also enclosed herewith are the documents necessary to enter into a royalty arrangement with Company. Set forth herein are instructions for the execution of the enclosed documents.
  
 Each person considering subscribing for Securities and entering into a royalty arrangement should review the following instructions:
  
 	  
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	 Subscription and Royalty Agreement: Two copies of the Subscription and Royalty Agreement must be completed, executed and delivered to the Company. The Company will execute both copies of the Subscription and Royalty Agreement and return one copy to you for your records. The Company shall have the right to accept or reject any subscription and royalty arrangement, in whole or in part. An acknowledgment of the acceptance of your subscription for the Securities subscribed and the entering into of the royalty arrangement will be returned to you promptly after acceptance.

			
	  
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	 Payment: Payment for the Securities subscribed for shall be made by cashier’s check or the wiring of immediately available funds or other means approved by the Company at or prior to the Closing (as defined in Section 3 of the Subscription and Royalty Agreement).

  
 Subscription and Royalty Agreement
  
 THE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED OR THE SECURITIES LAWS OF ANY STATE OR ANY OTHER JURISDICTION. THERE ARE FURTHER RESTRICTIONS ON THE TRANSFERABILITY OF THE SECURITIES DESCRIBED HEREIN.
  
 ANY NON-PUBLIC MATERIAL INFORMATION OBTAINED FROM THE COMPANY, IN CONNECTION WITH THE COMPANY, THE SECURITIES, THIS SUBSCRIPTION AND ROYALTY AGREEMENT OR THE TRANSACTIONS CONTEMPLATED BY THIS SUBSCRIPTION AND ROYALTY AGREEMENT, IS CONFIDENTIAL. BY ACCEPTING SUCH INFORMATION CONTAINED, THE RECIPIENT ACKNOWLEDGES ITS EXPRESS AGREEMENT WITH BIOCORRX INC. TO MAINTAIN IN CONFIDENCE SUCH INFORMATION PURSUANT TO SECTION 8 OF THIS SUBSCRIPTION AND ROYALTY AGREEMENT. BIOCORRX INC. HAS CAUSED THESE MATERIALS TO BE DELIVERED TO YOU IN RELIANCE UPON YOUR AGREEMENT TO MAINTAIN THE CONFIDENTIALITY OF THIS INFORMATION AND PURSUANT TO REGULATION FD PROMULGATED BY THE SECURITIES AND EXCHANGE COMMISSION.
  
 THE PURCHASE OF THE SECURITIES INVOLVES A HIGH DEGREE OF RISK AND SHOULD BE CONSIDERED ONLY BY PERSONS WHO CAN BEAR THE RISK OF THE LOSS OF THEIR ENTIRE INVESTMENT.
  
  	 
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 BIOCORRX INC.
  
 BioCorRx Inc.
 2390 East Orangewood Avenue
 Suite 575
 Anaheim, California 92806
  
 The undersigned understands that BioCorRx Inc., a corporation organized under the laws of Nevada (the “Company”), desired to sell shares of its common stock, par value $0.001 per share (the “Securities”), at a purchase price of $15.00 per share (the “Purchase Price”). As an additional inducement for the undersigned to purchase the Securities at the Purchase Price, the Company will pay a royalty to the undersigned with regard to the Business (as defined in Section 1.2.1). The undersigned further understands that the Securities will not be registered under the Securities Act of 1933, as amended (the “Securities Act”), or any securities law of any state of the United States or of any other jurisdiction, in reliance upon the exemption from securities registration afforded by Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”), or Rule 506 of Regulation D of as promulgated by the Securities and Exchange Commission (the “SEC”), under the Securities Act, or Regulation S, as promulgated by the SEC under the Securities Act.
  
 1. Subscription and Royalty.
  
  	  
	1.1 	Subscription. The undersigned hereby irrevocably subscribes for the Securities set forth in Appendix A hereto for the aggregate purchase price set forth in Appendix A, which is payable as described in Section 4 hereof. The undersigned acknowledges that the Securities will be subject to restrictions on transfer as set forth in this subscription and royalty agreement (the “Subscription and Royalty Agreement”).
	  
	  
	  

	  
	1.2 	Royalty.

  
  	  
	1.2.1 	WHEREAS, the Company is in the process of launching a new business division of providing a distinct weight loss program that includes a naltrexone implant or naltrexone pellets, behavioral counseling and a mobile application (the “Business”); 
	  
	  
	  

	  
	1.2.2 	WHEREAS, the Company intends to offer and sell the following weight loss program, which includes the following per order (patient): (i) one single dose of naltrexone implant (800mg naltrexone pellet(s)); (ii) access to the mobile app; and (iii) behavioral counseling via the app for three months (a “Treatment”);
	  
	  
	  

	  
	1.2.3 	WHEREAS, the Company desires additional funding to expand and grow the Business, and the undersigned desires, on the terms and conditions set forth herein, that the majority of the Purchase Price paid for the Securities be used by the Company to expand and grow the Business.

  
  	 
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	1.2.4 	NOW THEREFORE, in consideration of the foregoing recitals and the mutual promises, representations, warranties the Company and the undersigned hereby agree as follows with regard to the Business:
	  
	  
	  

	  
	1.2.5 	 Company Payments to the Undersigned. As and in consideration of the payment of the aggregate Purchase Price by the undersigned, the Company will make the following payments to the undersigned (the “Royalty”): (a) (i) a total of $37.50 from the gross revenue derived from each Treatment sold in the U.S. starting on the first (1st) day that the first unit of the Treatment is sold (the “Initial Sales Date”) and ending on the third (3rd) anniversary of the Initial Sales Date; and (b) a total of $25.00 from the gross revenue derived from each Treatment sold in the U.S. starting on the day following the third (3rd) anniversary of the Initial Sales Date and ending on the fifteenth (15th) anniversary of the Initial Sales Date. The Company may, at its sole discretion, also employ any additional funds they possess in order to satisfy the payment schedule detailed herein.

	  
	  
	  

	  
	1.2.6	Royalty Terms.

  
  	  
	1.2.6.1 	All Royalty payments shall be paid in U.S. dollars by check or wire transfer to a bank account specified in writing by the undersigned.
	  
	  
	  

	  
	1.2.6.2 	Royalty payments due shall be calculated on a quarterly basis for each Treatment sold, and paid sixty (60) days after the end of each quarter.

  
  	  
	1.2.7 	Royalty Covenants of the Company.

  
  	  
	1.2.7.1 	Each Royalty payment shall be accompanied by a written report providing detail sufficient to support the payment being made and how it was determined.
	  
	  
	  

	  
	1.2.7.2 	The Company shall keep accurate books and accounts of record in connection with its Business in sufficient detail to permit verification of its obligations in respect of the Royalty. The undersigned, at its expense, itself or through an independent, United States nationally or regionally recognized certified public accountant, shall have the right to access the Company’s relevant books and records for the sole purpose of verifying the Royalty payments. Such access shall be conducted after reasonable prior notice by the undersigned to the Company during the Company’s ordinary business hours and shall not be more frequent than twice during any calendar year

  
  	 
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	1.3 	Use of Proceeds. The Company will use no less than 65% of the proceeds of the aggregate Purchase Price exclusively to develop, expand and grow the Business, and for the launch and expansion of the Business including sales and marketing activities directly related to the Business, and shall be free to use up to 35% of the aggregate Purchase Price for general working capital and administration, and for further product development. The Company may use more than 35% of the aggregate Purchase Price for general working capital and administration, and for further product development, with the prior written consent of the undersigned.
	  
	  
	  

	  
	1.4 	Corporate Transactions. In the event of a consolidation, merger, acquisition or any other corporate reorganization, the Company agrees that one of the conditions of such corporate reorganization shall be that the acquiring entity assumes the liabilities and obligations of the Company pursuant to this Subscription and Royalty Agreement. 

   
 2. Acceptance of Subscription and Issuance of Securities. It is understood and agreed that the Company shall have the sole right, at its complete discretion, to accept or reject this subscription and royalty arrangement, in whole or in part, for any reason and that the same shall be deemed to be accepted by the Company only when it is signed by a duly authorized officer of the Company and delivered to the undersigned at the Closing referred to in Section 3 hereof. Subscriptions need not be accepted in the order received, and the Securities may be allocated among undersigned. Notwithstanding anything in this Subscription and Royalty Agreement to the contrary, the Company shall have no obligation to issue any of the Securities to any person who is a resident of a jurisdiction in which the issuance of Securities to such person would constitute a violation of the securities, “blue sky” or other similar laws of such jurisdiction (collectively referred to as the “State Securities Laws”).
  
 3. The Closing. The closing of the purchase and sale of the Securities (the “Closing”) shall take place at such time and place as the Company may designate by notice to the undersigned.
  
 4. Payment for Securities. Payment for the Securities shall be received by the Company from the undersigned by cashier’s check or the wiring of immediately available funds or other means approved by the Company at or prior to the Closing, in the amount as set forth in Appendix A hereto. The Company shall deliver certificates representing the Securities to the undersigned at the Closing bearing an appropriate legend referring to the fact that the Securities were sold in reliance upon an exemption from registration under the Securities Act.
  
  	 
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 5. Representations and Warranties of the Company. As of the Closing, the Company represents and warrants that:
  
 (a) The Company is duly formed and validly existing under the laws of Nevada, with full power and authority to conduct its business as it is currently being conducted and to own its assets; and has secured any other authorizations, approvals, permits and orders required by law for the conduct by the Company of its business as it is currently being conducted, and is duly qualified to do business and in good standing in each jurisdiction in which the failure to be so qualified would not reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect on the Company. “Material Adverse Effect” means, with respect to any person (including all natural persons, corporations, business trusts, associations, companies, partnerships, joint ventures and other entities), a material adverse effect on the business, financial condition, operations, results of operations, assets, customer, supplier or employee relations or future prospects of such person.
   
 (b) The Company has all requisite authority and power, authorizations, consents and approvals to enter into and deliver this Subscription and Royalty Agreement and any other certificate, agreement, document or instrument to be executed and delivered by the Company in connection with the transactions contemplated hereby and thereby and to perform its obligations hereunder and thereunder and to consummate the transactions contemplated hereby and thereby. The execution and delivery of this Subscription and Royalty Agreement by the Company and the performance by the Company of its obligations hereunder and thereunder and the consummation by the Company of the transactions contemplated hereby and thereby have been duly authorized by all necessary action on the part of the Company. This Subscription and Royalty Agreement has been duly and validly authorized and approved, executed and delivered by the Company.
  
 (c) Neither the execution or delivery by the undersigned of this Subscription and Royalty Agreement to which the Company is a party, nor the consummation or performance by the Company of the transactions contemplated hereby or thereby will, directly or indirectly, (a) contravene, conflict with, or result in a violation of any provision of the organizational documents of the Company; (b) contravene, conflict with, constitute a default (or an event or condition which, with notice or lapse of time or both, would constitute a default) under, or result in the termination or acceleration of, any agreement or instrument to which the Company is a party or by which the properties or assets of the Company are bound; or (c) contravene, conflict with, result in any breach of, or constitute a default (or an event that with notice or lapse of time or both would become a default) under, impair the rights of the undersigned under, or alter the obligations of any person under, or create in any person the right to terminate, amend, accelerate or cancel, or require any notice, report or other filing (whether with a governmental authority or any other person) pursuant to, or result in the creation of a lien on any of the assets or properties of the Company under, any note, bond, mortgage, indenture, contract, lease, license, permit, franchise or other instrument or obligation to which the Company is a party or any of the Company’s assets and properties are bound or affected.
  
 (d) There is no action pending against, or to the knowledge of the Company, threatened against or affecting, the Company by any governmental authority or other person with respect to the Company that challenges, or may have the effect of preventing, delaying, making illegal, or otherwise interfering with, any of the transactions contemplated by this Subscription and Royalty Agreement.
  
 (e) The Securities have been duly authorized and, when issued, delivered and paid for in the manner set forth in this Subscription and Royalty Agreement, will be validly issued, fully paid and nonassessable.
  
  	 
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 6. Representations and Warranties of the Undersigned. The undersigned hereby represents and warrants to and covenants with the Company that:
  
 (a) General.
  
 (i) The undersigned has all requisite authority (and in the case of an individual, the capacity) to purchase the Securities, enter into this Subscription and Royalty Agreement and to perform all the obligations required to be performed by the undersigned hereunder, and such purchase will not contravene any law, rule or regulation binding on the undersigned or any investment guideline or restriction applicable to the undersigned.
  
 (ii) The undersigned is a resident of or a corporation or other entity with its principal business address of the place set forth on the signature page hereto and is not acquiring the Securities as a nominee or agent or otherwise for any other person.
  
 (iii) The undersigned will comply with all applicable laws and regulations in effect in any jurisdiction in which the undersigned  sells Securities and obtain any consent, approval or permission required for such purchases or sales under the laws and regulations of any jurisdiction to which the undersigned is subject or in which the undersigned makes  or sales, and the Company shall have no responsibility therefore.
  
 (iv) Neither the execution or delivery by the undersigned of this Subscription and Royalty Agreement to which the undersigned is a party, nor the consummation or performance by the undersigned of the transactions contemplated hereby or thereby will, directly or indirectly, (a) contravene, conflict with, or result in a violation of any provision of the organizational documents of the undersigned (if the undersigned is not a natural person).
  
 (v) There is no action pending against, or to the knowledge of the undersigned, threatened against or affecting, the undersigned by any governmental authority or other person with respect to the undersigned that challenges, or may have the effect of preventing, delaying, making illegal, or otherwise interfering with, any of the transactions contemplated by this Subscription and Royalty Agreement.
  
 (b) No Brokers or Finders. No person has, or as a result of the transactions contemplated herein will have, any right or valid claim against the undersigned for any commission, fee or other compensation as a finder or broker, or in any similar capacity, based upon arrangements made by or on behalf of the undersigned and the undersigned will indemnify and hold the Company and its affiliates harmless against any liability or expense arising out of, or in connection with, any such claim.
  
 (c) Investment Representations. The undersigned severally, and not jointly, hereby represents and warrants, solely with respect to itself and not any other investor, to the Company as follows:
  
 (i) Purchase Entirely for Own Account. The undersigned is acquiring such the Securities proposed to be acquired hereunder for investment for its own account and not with a view to the resale or distribution of any part thereof, and the undersigned has no present intention of selling or otherwise distributing such Securities, except in compliance with applicable securities laws.
  
  	 
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 (ii) Restricted Securities. The undersigned understands that the Securities are characterized as “restricted securities” under the Securities Act inasmuch as this Subscription and Royalty Agreement contemplates that, if acquired by the shareholder pursuant hereto, the Securities would be acquired in a transaction not involving a public offering. The issuance of the Securities hereunder is being effected in reliance upon an exemption from registration afforded by Section 4(a)(2) of the Securities Act, or Rule 506 of Regulation D of as promulgated by the SEC under the Securities Act, or Regulation S, as promulgated by the SEC under the Securities Act. The undersigned further acknowledges that if the Securities are issued to the undersigned in accordance with the provisions of this Subscription and Royalty Agreement, such Securities may not be resold without registration under the Securities Act or the existence of an exemption therefrom. The undersigned represents that he is familiar with Rule 144, as presently in effect, and understands the resale limitations imposed thereby and by the Securities Act.
  
 (iii) Acknowledgment of Non-Registration. The undersigned understands and agrees that the Securities to be issued pursuant to this Subscription and Royalty Agreement have not been registered under the Securities Act or the securities laws of any state of the United States of America (the “U.S.”).
  
 (iv) Status. By its execution of this Subscription and Royalty Agreement, the undersigned represents and warrants to the Company as indicated on its signature page to this Subscription and Royalty Agreement, that the undersigned is, and will be at the Closing, an Accredited Investor (as defined below). The undersigned understands that the Securities are being sold to the undersigned in reliance upon the truth and accuracy of the representations, warranties, agreements, acknowledgments and understandings of the undersigned set forth in this Subscription and Royalty Agreement, in order that the Company may determine the applicability and availability of the exemptions from registration of the Securities on which the Company is relying.
  
 (v) Additional Representations and Warranties. The undersigned, severally and not jointly, further represents and warrants to the Company as follows: (i) such person qualifies as an Accredited Investor or is not a “U.S. Person” (both as defined below); (ii) such person consents to the placement of a legend on any certificate or other document evidencing the Securities substantially in the form set forth in Section 6(d); (iii) such person has sufficient knowledge and experience in finance, securities, investments and other business matters to be able to protect such person’s or entity’s interests in connection with the transactions contemplated by this Subscription and Royalty Agreement; (iv) such person has consulted, to the extent that it has deemed necessary, with its tax, legal, accounting and financial advisors concerning its investment in the Securities and can afford to bear such risks for an indefinite period of time, including, without limitation, the risk of losing its entire investment in the Securities; (v) such person has had access to the Company’s filings with the SEC (the “SEC Reports”); (vi) such person has been furnished during the course of the transactions contemplated by this Subscription and Royalty Agreement with all other public information regarding the Company that such person has requested and all such public information is sufficient for such person to evaluate the risks of investing in the Securities; (vii) such person has been afforded the opportunity to ask questions of and receive answers concerning the Company and the terms and conditions of the issuance of the Securities; (viii) such person is not relying on any representations and warranties concerning the Company made by the Company or any officer, employee or agent of the Company, other than those contained in this Subscription and Royalty Agreement or the SEC Reports; (ix) such person will not sell or otherwise transfer the Securities, unless either (A) the transfer of such securities is registered under the Securities Act or (B) an exemption from registration of such securities is available; (x) such person understands and acknowledges that the Company is under no obligation to register the Securities for sale under the Securities Act; (xi) such person understands and acknowledges that the Securities have not been recommended by any federal or state securities commission or regulatory authority, that the foregoing authorities have not confirmed the accuracy or determined the adequacy of any information concerning the Company that has been supplied to such person and that any representation to the contrary is a criminal offense; and (xii) such person acknowledges that the representations, warranties and agreements made by such person herein shall survive the execution and delivery of this Subscription and Royalty Agreement and the purchase of the Securities. “Accredited Investor” has the meaning set forth in Rule 501 under the Securities Act.
  
  	 
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 (vi) Additional Representations, Warranties and Covenants of Non-United States Persons. The undersigned, if it is not a U.S. Person (as defined below), severally and not jointly, further represents and warrants to the Company as follows: (i) the undersigned understands that the Securities offered hereunder has not been registered under the Securities Act and the undersigned understands that such undersigned is purchasing the Securities without being furnished any offering literature or prospectus. The undersigned is acquiring the Securities for the undersigned’s own account, for investment purposes only, and not with a view towards resale or distribution; (ii) at the time the undersigned was offered the Securities, it was not, and at the date hereof, such undersigned is not a “U.S. Person” which is defined below:
  
 (A) Any natural person resident in the United States;
  
 (B) Any partnership or corporation organized or incorporated under the laws of the United States;
  
 (C) Any estate of which any executor or administrator is a U.S. person;
  
 (D) Any trust of which any trustee is a U.S. person;
  
 (E) Any agency or branch of a foreign entity located in the United States;
  
 (F) Any non-discretionary account or similar account (other than an estate or trust) held by a dealer or other fiduciary for the benefit or account of a U.S. person;
  
 (G) Any discretionary account or similar account (other than an estate or trust) held by a dealer or other fiduciary organized, incorporated, or (if an individual) resident of the United States; and
  
 (H) Any partnership or corporation if (i) organized or incorporated under the laws of any foreign jurisdiction and (ii) formed by a U.S. person principally for the purpose of investing in securities not registered under the Securities Act, unless it is organized or incorporated, and owned, by accredited investors (as defined in Rule 501(a) of Regulation D promulgated under the Securities Act) who are not natural persons, estates or trusts.
  
  	 
	8
	 
 
	 

   
 “United States” or “U.S.” means the United States of America, its territories and possessions, any State of the United States, and the District of Columbia; (iii) The undersigned understands that no action has been or will be taken in any jurisdiction by the Company that would permit a public offering of the Securities in any country or jurisdiction where action for that purpose is required; (iv) the undersigned (i) as of the execution date of this Agreement is not located within the United States, and (ii) is not purchasing the Securities for the account or benefit of any U.S. person except in accordance with one or more available exemptions from the registration requirements of the Securities Act or in a transaction not subject thereto; (v) the undersigned will not resell the Securities except in accordance with the provisions of Regulation S (Rule 901 through 905 and Preliminary Notes thereto), pursuant to a registration under the Securities Act, or pursuant to an available exemption from registration; (vi) the undersigned will not engage in hedging transactions with regard to shares of the Company prior to the expiration of the distribution compliance period specified in Category 2 or 3 (paragraph (b)(2) or (b)(3)) in Rule 903 of Regulation S, as applicable, unless in compliance with the Securities Act; and as applicable, shall include statements to the effect that the securities have not been registered under the Securities Act and may not be offered or sold in the United States or to U.S. persons (other than distributors) unless the securities are registered under the Securities Act, or an exemption from the registration requirements of the Securities Act is available; and (vii) no form of “directed selling efforts” (as defined in Rule 902 of Regulation S under the Securities Act), general solicitation or general advertising in violation of the Securities Act has been or will be used nor will any offers by means of any directed selling efforts in the United States be made by the undersigned or any of their representatives in connection with the offer and sale of the Securities.
  
 (vii) Opinion. The undersigned will not transfer any or all of the undersigned’s Securities absent an effective registration statement under the Securities Act and applicable state securities law covering the disposition of the undersigned’s Securities, without first providing the Company with an opinion of counsel (which counsel and opinion are reasonably satisfactory to the Company) to the effect that such transfer will be exempt from the registration and the prospectus delivery requirements of the Securities Act and the registration or qualification requirements of any applicable U.S. state securities laws
  
 (viii) Consent. The undersigned understands and acknowledges that the Company may refuse to transfer the Securities, unless the undersigned complies with Section 6(d) and any other restrictions on transferability set forth herein. The undersigned consents to the Company making a notation on its records or giving instructions to any transfer agent of the Company’s common stock in order to implement the restrictions on transfer of the Securities
  
  	 
	9
	 
 
	 

   
 (d) Stock Legends. The undersigned hereby agrees with the Company as follows: The certificates evidencing the Securities issued to the undersigned who is an Accredited Investor, and each certificate issued in transfer thereof, will bear the following or similar legend:
  
 	  
	 THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN] REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL TO THE HOLDER (IF REQUESTED BY THE COMPANY), IN A FORM REASONABLY ACCEPTABLE TO THE COMPANY, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD OR ELIGIBLE TO BE SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID ACT. NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE SECURITIES; PROVIDED THAT IN CONNECTION WITH ANY FORECLOSURE OR TRANSFER OF THE SECURITIES, THE TRANSFEROR SHALL COMPLY WITH THE PROVISIONS HEREIN, IN THE SUBSCRIPTION AND ROYALTY AGREEMENT AND THE REGISTRATION RIGHTS AGREEMENT, AND UPON FORECLOSURE OR TRANSFER OF THE SECURITIES, SUCH FORECLOSING PERSON OR TRANSFEREE SHALL COMPLY WITH ALL PROVISIONS CONTAINED HEREIN, IN THE SUBSCRIPTION AND ROYALTY AGREEMENT AND THE REGISTRATION RIGHTS AGREEMENT.]
	

  
 (i) Other Legends. The certificates representing such Securities, and each certificate issued in transfer thereof, will also bear any other legend required under any applicable law, including, without limitation, any state corporate and state securities law, or contract.
  
 (e) Disclosure. No representation or warranty of the undersigned contained in this Subscription and Royalty Agreement and no statement or disclosure made by or on behalf of the undersigned to the Company or any of its Subsidiaries pursuant to this Subscription and Royalty Agreement herein contains an untrue statement of a material fact or omits to state a material fact necessary to make the statements contained herein or therein not misleading.
  
 (f) Non-Reliance.
  
 (i) The undersigned represents that it is not relying on (and will not at any time rely on) any communication (written or oral) of the Company, as investment advice or as a recommendation to purchase the Securities, it being understood that information and explanations related to the terms and conditions of the Securities and the other transaction documents shall not be considered investment advice or a recommendation to purchase the Securities.
  
 (ii) The undersigned confirms that the Company has not (A) given any guarantee or representation as to the potential success, return, effect or benefit (either legal, regulatory, tax, financial, accounting or otherwise) an of investment in the Securities or the Royalty payments or (B) made any representation to the undersigned regarding the legality of an investment in the Securities under applicable legal investment or similar laws or regulations. In deciding to purchase the Securities and enter into the royalty arrangement, the undersigned is not relying on the advice or recommendations of the Company and the undersigned has made its own independent decision that the investment in the Securities and entering into the royalty arrangement is suitable and appropriate for the undersigned.
  
  	 
	10
	 
 
	 

   
 (g) Section 13 or Section 16 Filings. The undersigned acknowledges and agrees that the undersigned is solely responsible for determining whether the undersigned is required to make any filings under Section 13 or Section 16 of the Exchange Act of 1934, as amended, and making all such filings. The undersigned shall be solely responsible for any attorneys’ fees or other costs associated with such determinations and filings.
  
 7. Conditions to Obligation of the Undersigned and the Company.
  
 (a) Conditions to Obligation of the Undersigned. The obligations of the undersigned to enter into and perform their respective obligations under this Subscription and Royalty Agreement are subject, at the option of the undersigned, to the fulfillment on or prior to the Closing of the following conditions, any one or more of which may be waived by the undersigned in writing:
  
 (i) The representations and warranties of the Company set forth in this Subscription and Royalty Agreement shall be true and correct in all material respects as of the Closing (except to the extent such representations and warranties are specifically made as of a particular date, in which case such representations and warranties shall be true and correct as of such date);
  
 (ii) No event, change or development shall exist or shall have occurred since the date of this Agreement that has had or is reasonably likely to have a Material Adverse Effect on the Company; and
  
 (iii) The Company shall have duly executed and delivered to the undersigned this Subscription and Royalty Agreement.
  
 (b) Conditions to Obligation of the Company. The obligations of the Company to enter into and perform its obligations under this Subscription and Royalty Agreement are subject, at the option of the Company, to the fulfillment on or prior to the Closing of the following conditions, any one or more of which may be waived by the Company:
  
 (i) The representations and warranties of the undersigned set forth in this Subscription and Royalty Agreement shall be true and correct in all material respects as of the Closing (except to the extent such representations and warranties are specifically made as of a particular date, in which case such representations and warranties shall be true and correct as of such date); and
  
  	 
	11
	 
 
	 

  
 (ii) The undersigned shall have executed this Subscription and Royalty Agreement to which it is a party and completed its investor questionnaire substantially in form attached hereto as Exhibit A and delivered the same to the Company.
  
 8. Confidentiality. The undersigned shall maintain in confidence, and will cause their respective directors, officers, employees, agents, and advisors to maintain in confidence, any written, oral, or other, non-public material information obtained from the Company in connection with the Company, the Securities, the Business, the Royalty, this Subscription and Royalty Agreement or the transactions contemplated by this Subscription and Royalty Agreement, unless (a) such information becomes publicly available through no fault of such Party, or (b) the furnishing or use of such information is required by or necessary or appropriate in connection with legal proceedings. The undersigned understands that under federal securities laws, it is unlawful for persons with insider or material non–public information to trade shares of the Company’s securities.
  
 9. Demand Registration Rights. The undersigned has the right to demand that the Company prepare and file with the SEC a Registration Statement on Form S-1 or such other Registration Statement as the Company then qualifies to use, as determined by the Company in its sole discretion, to effect a registration of the Securities covering the resale of the Securities. The Company will utilize reasonable commercial efforts to prepare and file such Registration Statement with the SEC within one hundred twenty (120) days after such demand. The Company may also include in such Registration Statement, in its sole discretion, shares for sale by the Company or the Company may file a separate Registration Statement covering shares to be sold by the Company before, at the same time, or after the Company files a Registration Statement covering resale of the Securities by the undersigned. 
  
 10. Waiver, Amendment. Neither this Subscription and Royalty Agreement nor any provisions hereof shall be modified, changed, discharged or terminated except by an instrument in writing, signed by the party against whom any waiver, change, discharge or termination is sought.
  
 11. Assignability. Neither this Subscription and Royalty Agreement nor any right, remedy, obligation or liability arising hereunder or by reason hereof shall be assignable by either the Company or the undersigned without the prior written consent of the other party.
  
 12. Waiver of Jury Trial. THE UNDERSIGNED IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY WITH RESPECT TO ANY LEGAL PROCEEDING ARISING OUT OF THE TRANSACTIONS CONTEMPLATED BY THIS SUBSCRIPTION AND ROYALTY AGREEMENT.
  
 13. Submission to Jurisdiction. With respect to any suit, action or proceeding relating to any offers, purchases or sales of the Securities by the undersigned, the undersigned irrevocably submits to the jurisdiction of the federal or state courts located in the City of Los Angeles, California which submission shall be exclusive unless none of such courts has lawful jurisdiction over such proceedings.
  
  	 
	12
	 
 
	 

   
 14. Governing Law. This Subscription and Royalty Agreement shall be governed by and construed in accordance with the laws of the State of California.
  
 15. Section and Other Headings. The section and other headings contained in this Subscription and Royalty Agreement are for reference purposes only and shall not affect the meaning or interpretation of this Subscription and Royalty Agreement.
  
 16. Counterparts. This Subscription and Royalty Agreement may be executed in any number of counterparts, each of which when so executed and delivered shall be deemed to be an original and all of which together shall be deemed to be one and the same agreement.
  
 17. Notices. All notices (including change of addresses) and other communications provided for herein shall be in writing and shall be deemed to have been duly given if delivered personally or sent by registered or certified mail, return receipt requested, postage prepaid to the following addresses (or such other address as either party shall have specified by notice in writing to the other):
  
 	 If to the Company: 
	 BioCorRx Inc.
 2390 East Orangewood Avenue
 Suite 575
 Anaheim, California 92806

		
	  
	 Attn: Lourdes Felix, CFO/COO
 Telephone No.: (714) 462-4880

		  

	 If to the Purchaser:
	
		
	  
	 Attention: 

		

  
 18. Binding Effect. The provisions of this Subscription and Royalty Agreement shall be binding upon and accrue to the benefit of the parties hereto and their respective heirs, legal representatives, successors and assigns.
  
 19. Survival. All representations, warranties and covenants contained in this Subscription and Royalty Agreement shall survive (i) the acceptance of the subscription by the Company and (ii) the death or disability of the undersigned.
  
 20. Notification of Changes. The undersigned hereby covenants and agrees to notify the Company upon the occurrence of any event prior to the closing of the purchase of the Securities pursuant to this Subscription and Royalty Agreement which would cause any representation, warranty, or covenant of the undersigned contained in this Subscription and Royalty Agreement to be false or incorrect.
  
 21. Severability. If any term or provision of this Subscription and Royalty Agreement is invalid, illegal or unenforceable in any jurisdiction, such invalidity, illegality or unenforceability shall not affect any other term or provision of this Subscription and Royalty Agreement or invalidate or render unenforceable such term or provision in any other jurisdiction.
  
  
 [SIGNATURE PAGE FOLLOWS]
  
  	 
	13
	 
 
	 

  
 IN WITNESS WHEREOF, the undersigned has executed this Subscription and Royalty Agreement this 27th day  of  March, 2019.
  
 	 PURCHASER (if an individual): 
	  
	 PURCHASER (if an entity):
	
						
					  

	 By 
		  
	 Legal Name of Entity
	  

	 Name:
					
			  
	 By
		
			  
	 Name:
		
			  
	 Title:
		

  
 Place of Domicile or Formation: ___________________________
 Aggregate Subscription Amount: $3,000,000.00
  
 The offer to purchase Securities as set forth above is confirmed and accepted by the Company as to 200,000 shares of its common stock.
  
 	  
	 BIOCORRX INC.
	
				
	  
	 By:
		
	  
	 Name:
	 Lourdes Felix
	
	  
	 Title: 
	 CFO/COO
	

  
  	 
	14
	 
 
	 

  
 APPENDIX A 
  
 CONSIDERATION TO BE DELIVERED
  
 	 Securities to Be Acquired 
	  
	 Purchase Price 
	  
	 Aggregate Purchase Price to be Paid

					  

	 200,000 shares of the 
 Company’s common stock
	  
	 $15.00 per share
	  
	 $3,000,000.00

  
  	 
	15
	 
 
	 

  
 EXHIBIT A
  
 INVESTOR QUESTIONNAIRE
  
 See the attached.
  
  
  	16

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