Document:

IntelGenx Technologies Corp.: Exhibit 10.2 - Filed by newsfilecorp.com

Exhibit 10.2

CONFIDENTIAL TREATMENT REQUESTED 
Redacted
portions are indicated by [****] 

Redacted portions filed separately with the SEC pursuant

to the confidential treatment request 

CONFIDENTIAL 

	
    Term Sheet: [****]
      Co-development and Licensing Agreement 

	
	
     April 2010 

	
      The purpose of this term sheet (“Term Sheet”) is
      to set forth the terms for an exclusive worldwide co- development and
      licensing agreement between IntelGenx Technologies Corp., a US
      corporation, or any subsidiaries thereof (“IGXT”) and RedHill
      Biopharma Ltd. (“RedHill”), an Israeli corporation or its designee
      (collectively the “Parties”). This Term Sheet is legally binding on
      the Parties and is subject only to satisfactory customary due diligence by
      RedHill, verifying inter alia that no drastic changes emerge vis a vis the
      currently estimated budgetary requirements, and regulatory, technical, IP
      and market risks, and the Parties entering into definite documentation
      (the “Agreement”) elaborating on the terms of this Term Sheet, and
      other customary terms including, without limitation, representations and
      warranties, liability and indemnity, and including a side letter to be
      executed by the original inventors/licensors (if other than IGXT).
  

		
	
    Limited
      Term 
	
      This Term Sheet will expire and become null if not
      executed by both parties on or before Monday, April 19, 2010, 5pm EST.

      To the extent possible, execution of the Agreement
      (“Closing”) is anticipated to take place on or before Monday, July
      18, 2010

      
	
    Product 
	
      [****] – [****] formulation based on IGXT’s proprietary
      and patented VersaFilm oral drug delivery technology in all indications
      whatsoever (for both human and animals) and in all doses and formulations
      whatsoever. 

	
    Field 
	
      All indications whatsoever (including, but not limited to
      [****]) with right to sub-license (and further sub-license) in all
      indications and formulations whatsoever, and the right to commercialize
      the Product in all countries of the world. 

	
    Territory
    
	
      Worldwide 

	
    Collaboration
      Project 
	
      The Parties wish to develop the Product for use in the
      Field and commercialization in the Territory (the “Project”). The
      Project shall be comprised of all activities relating to the development
      and commercialization of the Product in the Territory. 

	
    Responsibilities and
      Decision-making 
	
      The Parties shall jointly take all key decisions
      regarding the development and commercialization of the Product subject to
      the following: 

 

	 	
     IGXT: 

      	Primary responsibility for the development of the Product and the
        final vote on development, regulatory and manufacturing decisions
        
	Funding the costs of the Project according to the "Internal Costs”
        in the budget specified in Annex A. 

       RedHill:

      	Primary responsibility for the licensing and partnering of the
        Product and the final vote on partnering/licensing/commercialization
        decisions.
        
	Funding the external development costs of the Project up to a
        maximum of [****] according to the “External Costs” in the budget
        specified in Annex A and according to payment procedures to be specified
        in the Agreement and according to the development plan specified in
        Annex B, reflecting actual progress in the various stages of the
        development of the program (Note: all numbers and other details
        specified in Annex A and Annex B are subject to a final development
        budget and plan to be agreed and specified in detail in the Agreement
        following the due diligence by RedHill). 

	
    Payments
      
	
                  
      RedHill Shall make the following one-time milestone payments to IGXT (Note:
      all payments are due only once for the Product): 

      	
      Within 7 days
      of Closing: [****]
      

	
      Within 30 days
      of Closing: [****]
      

	
      Within 60 days
      of Closing: [****]
      

	
      Within 30 days
      of successful completion of scale up, process development, and production
      of pivotal batches (“Development Milestone I”): [****]
      

	
      Within 30 days
      of filing and acceptance of the NDA by the US FDA (“Development
      Milestone II”): [****]
      

	
      Within 30 days
      of the Product marketing approval (approval of the NDA of the Product) by
      the US FDA (“Development Milestone III”): [****] 

      R&D tax credits and all other tax or other credits
      that relate directly to development or R & D activities of the Product in
      Canada or anywhere else, actually received by IGXT, as a direct or
      indirect result of funds provided or otherwise invested by RedHill, are
      expressly covered by the definition of Rights in the Project and such tax
      credit amounts shall be deducted from RedHill’s Development Milestone
      payments to IGXT, or otherwise transferred back to RedHill within 30 days
      of actual receipt of the tax credit by IGXT. Any and all third party
      (government and/or other) financing for the Project shall be
      proportionally deducted from the Parties’ respective contribution toward
      the internal (IGXT) and external (RedHill) costs of the Project. For the
      purpose of clarity, tax credits as they pertain to this Term Sheet do not
      include corporate taxes or other similar taxes. For the avoidance of any
      doubt, any and all discounts or other price reductions for the Project resulting
      from tax credits available to third party service providers as part of the
      external development costs of the Project, shall be fully reflected as
      such in reducing RedHill’s commitment to pay such external development
      costs.
      

2 

	
    Rights in the
      Product and Resulting Proceeds 
	
      In territories where the Product is marketed by a third party
      marketing partner: RedHill will receive [****] and IGXT will
      receive [****] of all proceeds (“Proceeds”) including, but not
      limited to, all sales milestones, income and all monetary and non monetary
      value whatsoever resulting anywhere in the world directly and/or
      indirectly from the Product and the Project in all countries of the world.
      Notwithstanding the foregoing, [****] of Proceeds, RedHill shall receive
      [****] and IGXT shall receive [****] (“Initial Proceeds Split”).
      For the avoidance of any doubt, the Initial Proceeds Split will only apply
      once for the Product, and not per territory or per third party partner.
      Therefore, following the Initial Proceeds Split, RedHill will receive
      [****] and IGXT will receive [****] of any and all Proceeds exceeding
      [****]. A mechanism of reimbursement for qualifying and itemized costs
      incurred by any of the Parties in relation to the partnering of the
      product shall be specified in the Agreement. 

      In territories where RedHill sells the Product on its own:
      RedHill will receive [****] and IGXT will receive [****] of net sales
      (to be defined) actually received by RedHill. 

	
    IP
      Ownership 
	
    All
      Product-related IP developed prior to the Closing: IGXT, with a license to
      be granted to RedHill per the terms of the Agreement (detailed terms of
      the license to be specified in the Agreement). For all Product related IP
      solely developed by IGXT after Closing, IGXT retains ownership and will
      grant to RedHill an exclusive, worldwide license to such IP for the
      commercial exploitation of the Product. Any Product related IP jointly
      developed by the parties will be owned jointly by the parties. Each party
      shall have the right to use such jointly developed IP for products other
      than the Product provided that such other products do not compete with the
      Product or other products of the other party; and provided that neither
      party shall grant an exclusive license (i.e. exclusivity to the rights of
      the licensing party) to or otherwise dispose of joint IP without the prior
      written consent of the other party; other than an assignment or transfer
      in connection with a merger of such party or sale of all or substantially
      all of its assets or shares. 

	
    Steering
      Committee 
	
    Within
      thirty (30) days of the Closing, the Parties shall establish a joint
      (50/50) Steering Committee (“SC”) comprising not less than four (4)
      members, with at least two (2) being appointed and replaced by IGXT, of
      which one shall be the IGXT Project Leader, and at least two (2) being
      appointed and replaced by RedHill, of which one shall be the RedHill
      Project Leader. All such representatives shall be individuals of suitable
      authority and seniority with significant and relevant experience and
      expertise. Any appointment or replacement shall be notified to the other
      Party in writing. The SC shall oversee the overall execution of the
      objectives of the Project. In particular, the SC shall (i) monitor the
      progress of the R&D Program against the timeframe and estimated budgets and any amendments agreed between the Parties, (ii)
      report on delays in the conduct of the R&D Program which would
      materially affect IGXT’s ability to successfully complete the R&D
      Program within the timeframe or estimated budgets and (iii) determine
      whether corrective action is required.

3 

	
    
	
      The Project Leaders shall facilitate the flow of information and
      otherwise promote communications and collaboration within and among the
      Parties, the SC, and any other sub-committees or teams that the SC may
      appoint or constitute. The SC shall meet at least monthly on the phone or
      in person. Meetings shall be chaired alternatively by the IntelGenx
      Project Leader and the RedHill Project Leader. Each Party shall be
      responsible for its own meeting- related costs. The Project Leader
      conducting the meeting also will be responsible for taking and
      distributing the minutes. At and between meetings of the SC, each Party
      shall keep the other fully and regularly informed as to its progress with
      its respective tasks and obligations under the Agreement. The Parties
      shall undertake their respective obligations under the Agreement on a
      collaborative basis. In case the SC cannot reach an agreement on a
      professional matter related to the development of the Product, the matter
      shall be submitted to a third party expert for an additional expert
      opinion. In the event that the parties cannot agree upon a third party
      within 21 days of the dispute arising, the matter shall be submitted to
      arbitration. 

	
    R&D, Manufacturing and other Data 
	
    Within
      7 (seven) days of the Closing and regularly thereafter, IGXT shall provide
      RedHill, at no cost to RedHill, with all the information and it has about
      the Product including, but not limited to, all Patents, know-how, R&D
      data, past trials data, communications with regulatory authorities in the
      US, Europe and elsewhere, manufacturing, supply, external service and
      other contracts and any and all other information whatsoever that is
      relevant for the development, marketing approval, marketing and other
      commercialization of the Product. 

	
    Exclusivity and Due Diligence 
	
    IGXT
      understands and acknowledges that RedHill will invest significant capital,
      management time and other resources during the expedited due diligence
      period. Accordingly, for a period of 90 days starting on the date of this
      Term Sheet (the “Due Diligence Exclusivity Period”), IGXT shall
      fully and swiftly cooperate with RedHill and provide RedHill with all
      requested technical, legal, audit and other information that is reasonably
      and customarily necessary for conducting and completing such due diligence
      process. During the Due Diligence Exclusivity Period IGXT shall not
      initiate, engage, or continue any discussions with any party other than
      RedHill with regard to a transaction covering or otherwise involving the
      Product in any way. Upon signing this Term Sheet IGXT shall immediately
      discontinue any and all third party discussions regarding or affecting the
      Product in any way and shall immediately inform all relevant parties that
      it has formally entered a binding agreement and exclusivity period. IGXT
      shall completely refrain from supplying any information to any third party
      enquiries concerning the Product during the Expedited Due Diligence
      Exclusivity Period. Furthermore, in the event that IGXT’s corporate
      approval is not obtained by the end of the Due Diligence Exclusivity
      Period, or IGXT otherwise declines or is unable to complete the
      transaction for whatever reason, IGXT shall pay RedHill, within 30
      (Thirty) days, an amount equal to US $50,000 to compensate RedHill for its
      due diligence costs and expenses, and other costs incurred by it,
      including alternative costs (“Breakup Fee”). Should RedHill decline
      to complete the transaction for reasons other than unsatisfactory due
      diligence results, RedHill shall pay IGXT, within 30 (Thirty) days, a
      Breakup Fee equal to US $50,000 to compensate IGXT for hosting the due
      diligence and other costs incurred by it, including alternative costs. 

4 

	
    Confidentiality 
	
    Subject to compulsory regulatory and legal
      requirements or (in the absence of such requirements) a written approval
      from the other party, neither party shall make any public release or other
      public disclosure to third parties (other than the Parties’ professional
      advisors) concerning this Term Sheet, the Agreement contemplated hereby or
      the status of the discussions between or among IGXT and RedHill without
      first allowing the other party to review and comment on the wording of the
      relevant announcement such review and comment not to be unreasonably
      withheld. Subject to confidentiality, RedHill is expressly permitted to
      generally describe the Product to its investors provided it is done with
      the aim of securing the financing needed to continue the development of
      the Product. 

	
    Diligence Obligation 
	
    IGXT will make a good faith, continuous and
      diligent effort to allocate all appropriate resources to prepare, initiate
      and complete the clinical development of the Product and file an
      application for regulatory marketing approval in accordance with industry
      standards, and within the agreed budget and timeframe (the “Diligence
      Obligation”). Any expenses exceeding the agreed development budget
      must be authorized by the Steering Committee. IntelGenx will be
      responsible for all internal expenses that exceed the agreed budget by up
      to 10% and RedHill will be responsible for all external expenses that
      exceed the agreed budget (Annex A) by up to 10%. If the internal and/or
      external budgets exceed the planned budget specified in Annex A by more
      than 10%, the Parties will discuss in good faith the necessary next steps
      to advance the Project under these new circumstances. In the event that
      the Parties cannot agree on the necessary next steps, within 21 days of
      the dispute arising, the matter shall be submitted to arbitration. 

	
    Governing Law 
	
    This Term Sheet is exclusively governed by
      English law and the courts of London, England. 

	 	 
	
    Acknowledged and agreed: 
	
      

	
    
	
    

	
    For IntelGenx Technologies Corp. 
	
    For RedHill Biopharma Ltd. 

	
    By:  /s/Horst G. Zerbe                         
     
	
    By: /s/ Ori Shilo                                  
     

	
    Name: Horst G. Zerbe 
	
    Name: Ori Shilo

	
    Title: President and CEO 
	
    Title: VP Finance and Operation

	
    Date: April 19, 2010                             
     
	
    Date: April 18, 2010                             
    

5 

ANNEX A 

[****]

 

A-1 

Annex B 

[****] 

 

B-1Latin America Ventures, Inc.: Exhibit 4.1- Filed by newsfilecorp.com

Exhibit 4.1

THESE SECURITIES AND ANY SECURITIES ISSUABLE UPON EXERCISE OF THIS SECURITY HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A
TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY AN OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE
REASONABLY ACCEPTABLE TO THE COMPANY. NOTWITHSTANDING THE FOREGOING, THESE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THESE SECURITIES. 

Right to Purchase up to _________Shares of Common Stock of 

Latin America Ventures, Inc. (subject to adjustment as provided herein)

COMMON STOCK PURCHASE WARRANT

 

	No. _______	
    Issue Date: May 12, 2010

              Latin America Ventures, Inc. (the “Company”), hereby certifies that, for value received, _____________________, or its assigns (the “Holder”), is entitled, subject to the terms set forth
below, to purchase from the Company (as defined herein) from and after the Issue Date and at any time or from time to time before 5:00 p.m., New York time, through the close of business on the date that is four years from the Issue Date set forth
above (the “Expiration Date”), up to ________________(_________) fully paid and nonassessable shares of Common Stock (as hereinafter defined), $0.001 par value per share, at the applicable Exercise Price per share (as
defined below). The number and character of such shares of Common Stock and the applicable Exercise Price per share are subject to adjustment as provided herein.

As used herein the following terms, unless the context otherwise requires, have the following respective meanings: 

(a) 

The term “Company” shall include Latin America Ventures, Inc. and any
corporation which shall succeed, or assume the obligations of, Latin America
Ventures, Inc. hereunder. 

(b) 

The term “Common Stock” includes (i) the Company’s Common Stock, par value $0.001 per share; and (ii) any other securities into which or for which any of the securities described in the preceding
clause (i) may be converted or exchanged pursuant to a plan of recapitalization, reorganization, merger, sale of assets or otherwise. 

(c) 

The “Exercise Price” applicable under this Warrant shall be $3.61 on the date of
issuance. 

(d) 

The “Fair Market Value” of a share of Common Stock as of a particular date (the
“Determination Date”) shall mean (a) if the Common Stock is then listed or
quoted on a national trading market, the volume weighted average price of the
Common Stock for the 20 trading days preceding such Determination Date, (b) if
the Common Stock is not then listed or quoted on a national trading market and
if prices for the Common Stock are then quoted on the OTC Bulletin Board, the
volume weighted average price of the Common Stock for the 20 trading days
preceding such Determination Date on the OTC Bulletin Board, (c) if the Common
Stock is not then listed or quoted on the OTC Bulletin Board and if prices for
the Common Stock are then reported in the “Pink Sheets” published by Pink
Sheets, LLC (or a similar organization or agency succeeding to its functions of
reporting prices), the average bid price per share of the Common Stock for the
20 trading days preceding such Determination Date as so reported, or (d) in all
other cases, the value of the Common Stock as determined in good faith by the
Company’s Board of Directors. 

(e) 

The term “Other Securities” refers to any stock (other than Common Stock) and
other securities of the Company or any other person (corporate or otherwise)
which the holder of the Warrant at any time shall be entitled to receive, or
shall have received, on the exercise of the Warrant, in lieu of or in addition
to Common Stock, or which at any time shall be issuable or shall have been
issued in exchange for or in replacement of Common Stock or Other Securities
pursuant to Section 3 or otherwise. 

1. 

Exercise of Warrant.

1.1. 

Method of Exercise. From and after the Issue Date through and including
the Expiration Date, the Holder shall be entitled to receive, upon exercise of this Warrant in whole or in part, by delivery of an original or fax copy of a duly executed exercise notice in the form attached hereto as Exhibit A (the “Exercise
Notice”) and payment of the aggregate Exercise Price of the shares thereby purchased by wire transfer or cashier’s check drawn on a United States bank (unless cashless exercise shall have been elected in accordance with the provisions of
Section 1.2 hereof), up to that number of shares of Common Stock referred to above, subject to adjustment pursuant to Section 4 and subject to the Company having sufficient authorized shares of Common Stock, provided, however, within 5
Trading Days of the date said Exercise Notice is delivered to the Company, the Holder shall have surrendered this Warrant to the Company. 

1.2. 

Cashless Exercise. Notwithstanding any provisions herein to the contrary, if one or more registration statements under the Securities Act providing for the resale of all shares of Common Stock underlying the
Warrants have not been declared effective by the U.S. Securities and Exchange Commission, or the prospectuses forming a portion of such registration statement(s) is not then available for the resale of all such shares of Common Stock, in lieu of
exercising this Warrant by payment of cash, the Holder may exercise this Warrant by a cashless exercise and shall receive the number of shares of Common Stock equal to an amount (as determined below) by surrender of this Warrant at the principal
office of the Issuer together with
the properly endorsed Notice of Exercise in which event the Issuer shall issue to the Holder a number of shares of Common Stock computed using the following formula: 

2

 

	
 
		
X =	
              
  Y (B-A)
	
	
 
		
 
		
                    
B
	
	
 
		
 
		
 
	
	
Where
		
X =	
          the number of shares of Common Stock to be issued to the
	
	
 
		
 
		
          Holder.
	
	
 
		
 
		
 
	
	
 
		
Y =	
          the number of shares of Common Stock purchasable upon
	
	
 
		
 
		
          exercise of all of the Warrant or, if only a portion of the Warrant
	
	
 
		
 
		
          is being exercised, the portion of the Warrant being exercised.
	
	
 
		
 
		
 
	
	
 
		
A =	
          the Warrant Price.
	
	
 
		
 
		
 
	
	
 
		
B =
		
          the average of the Fair Market Value for the five days
	
	
 
		
 
		
          immediately preceding the date of the Notice of Exercise.
	

2. 

Procedure for Exercise. 

2.1. 

Delivery of Stock Certificates, Etc., on Exercise.  The Company agrees
that the shares of Common Stock purchased upon exercise of this Warrant shall be deemed to be issued to the Holder as the record owner of such shares as of the close of business on the date on which this Warrant shall have been surrendered and
payment made for such shares in accordance herewith. As soon as practicable after the exercise of this Warrant in full or in part, and in any event within five (5) business days thereafter, the Company at its expense (including the payment by it of
any applicable issue taxes) will cause to be issued in the name of and delivered to the Holder, or as such Holder (upon payment by such Holder of any applicable transfer taxes) may direct in compliance with applicable securities laws, a certificate
or certificates for the number of duly and validly issued, fully paid and nonassessable shares of Common Stock (or Other Securities) to which such Holder shall be entitled on such exercise, plus, in lieu of any fractional share to which such holder
would otherwise be entitled, cash equal to such fraction multiplied by the then Fair Market Value of one full share, together with any other stock or other securities and property (including cash, where applicable) to which such Holder is entitled
upon such exercise pursuant to Section 1 or otherwise. 

2.2. 

Exercise. Payment may be made in cash or by check payable to the order of the Company equal to the applicable aggregate Exercise Price for the number of shares of Common Stock specified in such Exercise
Notice (as such exercise number shall be adjusted to reflect any adjustment in the total number of shares of Common Stock issuable to the Holder per the terms of this Warrant) and the Holder shall thereupon be entitled to receive the number of duly
authorized, validly issued, fully paid and nonassessable shares of Common Stock (or Other Securities) determined as provided herein.  If the Holder exercises this Warrant pursuant to Section 1.2 hereof, then such exercise shall be made by delivery
of the Exercise Notice indicating such cashless exercise.

3

3. 

Effect of Reorganization, Etc.; Adjustment of Exercise Price. 

3.1. 

Reorganization, Consolidation, Merger, Etc. In case at any time or from
time to time, the Company shall (a) effect a reorganization, (b) consolidate with or merge into any other person, or (c) transfer all or substantially all of its properties or assets to any other person under any plan or arrangement contemplating
the dissolution of the Company, then, in each such case, as a condition to the consummation of such a transaction, proper and adequate provision shall be made by the Company whereby the Holder, on the exercise hereof as provided in Section 1 at any
time after the consummation of such reorganization, consolidation or merger or the effective date of such dissolution, as the case may be, shall receive, in lieu of the Common Stock (or Other Securities) issuable on such exercise prior to such
consummation or such effective date, the stock and other securities and property (including cash) to which such Holder would have been entitled upon such consummation or in connection with such dissolution, as the case may be, if such Holder had so
exercised this Warrant, immediately prior thereto, all subject to further adjustment thereafter as provided in Section 4. 

3.2. 

Continuation of Terms. Upon any reorganization, consolidation, merger or transfer (and any dissolution following any transfer) referred to in this Section 3, this Warrant shall continue in full force and
effect and the terms hereof shall be applicable to the shares of stock and other securities and property receivable on the exercise of this Warrant after the consummation of such reorganization, consolidation or merger or the effective date of
dissolution following any such transfer, as the case may be, and shall be binding upon the issuer of any such stock or other securities, including, in the case of any such transfer, the person acquiring all or substantially all of the properties or
assets of the Company, whether or not such person shall have expressly assumed the terms of this Warrant as provided in Section 3.1. In the event this Warrant does not continue in full force and effect after the consummation of the transactions
described in this Section 3, then the Company’s securities and property (including cash, where applicable) receivable by the Holder will be delivered to the Holder. 

4. 

Extraordinary Events Regarding Common Stock. In the event that the Company shall (a) issue additional shares of the Common Stock as a dividend or other distribution on outstanding Common Stock or any preferred
stock issued by the Company (b) subdivide its outstanding shares of Common Stock, or (c) combine its outstanding shares of the Common Stock into a smaller number of shares of the Common Stock, then, in each such event, the Exercise Price shall,
simultaneously with the happening of such event, be adjusted by multiplying the then Exercise Price by a fraction, the numerator of which shall be the number of shares of Common Stock outstanding immediately prior to such event and the denominator
of which shall be the number of shares of Common Stock outstanding immediately after such event, and the product so obtained shall thereafter be the Exercise Price then in effect. The Exercise Price, as so adjusted, shall be readjusted in the same
manner upon the happening of any successive event or events described herein in this Section 4. The number of shares of Common Stock that the Holder shall thereafter, on the exercise hereof as provided in Section 1, be entitled to receive shall be
adjusted to a number determined by multiplying the number of shares of Common Stock that would otherwise (but for the provisions of this Section 4) be issuable on such exercise by a fraction of which (a) the numerator is the Exercise Price that
would otherwise (but for the provisions of this Section 4) be in effect, and (b) the denominator is the Exercise Price in effect on the date of such exercise (taking into account the provisions of this Section 4). 

4

5. 

Pro Rata Distributions. If the Company, at any time prior to the Expiration Date, shall distribute to all holders of Common Stock (and not to Holders of the Warrants) evidences of its indebtedness or assets
(including cash and cash dividends) or rights or warrants to subscribe for or purchase any security), then in each such case the Exercise Price shall be adjusted by multiplying the Exercise Price in effect immediately prior to the record date fixed
for determination of stockholders entitled to receive such distribution by a fraction of which the denominator shall be the Fair Market Value determined as of the record date mentioned above, and of which the numerator shall be such Fair Market
Value on such record date less the then per share Fair Market Value at such record date of the portion of such assets or evidence of indebtedness so distributed applicable to one outstanding share of the Common Stock as determined by the Board of
Directors in good faith.  In either case the adjustments shall be described in a statement provided to the Holder of the portion of assets or evidences of indebtedness so distributed or such subscription rights applicable to one share of Common
Stock. Such adjustment shall be made whenever any such distribution is made and shall become effective immediately after the record date mentioned above. 

6. 

Certificate as to Adjustments. In each case of any adjustment or readjustment in the shares of Common Stock (or Other Securities) issuable on the exercise of this Warrant, the Company at its expense will
promptly cause its Chief Financial Officer or other appropriate designee to compute such adjustment or readjustment in accordance with the terms of this Warrant and prepare a certificate setting forth such adjustment or readjustment and showing in
detail the facts upon which such adjustment or readjustment is based, including a statement of (a) the consideration received or receivable by the Company for any additional shares of Common Stock (or Other Securities) issued or sold or deemed to
have been issued or sold, (b) the number of shares of Common Stock (or Other Securities) outstanding or deemed to be outstanding, and (c) the Exercise Price and the number of shares of Common Stock to be received upon exercise of this Warrant, in
effect immediately prior to such adjustment or readjustment and as adjusted or readjusted as provided in this Warrant.  The Company will forthwith mail a copy of each such certificate to the Holder and any Warrant agent of the Company (appointed
pursuant to Section 10 hereof). 

7. 

Status of Stock Issuable on Exercise of Warrant. The Company represents that all shares of Common Stock which may be issued upon the exercise of this Warrant will, when issued and paid for in accordance with
the terms of this Warrant, be duly authorized, validly issued, fully paid and nonassessable and free from all taxes, liens and charges in respect of the issue thereof (other than restrictions imposed by the applicable laws and taxes in respect of
any transfer occurring contemporaneously with such issue). 

8. 

Assignment; Exchange of Warrant.  Subject to compliance with any applicable securities laws and the conditions set forth in any restrictive legend appearing on the face hereof, this Warrant and all rights
hereunder are transferable, in whole or in part, upon surrender of this Warrant at the principal office of the Company, together with a written assignment of this Warrant substantially in the form attached hereto as Exhibit B duly executed by the
Holder or its agent or attorney and funds sufficient to pay any transfer taxes payable upon the making of such transfer. Upon such surrender and, if required, such payment, the Company shall execute and deliver a new Warrant or Warrants in the name
of the assignee or assignees and in the denomination or denominations specified in such instrument of assignment, and shall issue to the
assignor a new Warrant evidencing the portion of this Warrant not so assigned, and this Warrant shall promptly be cancelled. A Warrant, if properly assigned, may be exercised by a new holder for the purchase of Warrant Shares without having a new
Warrant issued. 

5

9. 

Replacement of Warrant.  On receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation of this Warrant and, in the case of any such loss, theft or destruction of
this Warrant, on delivery of an indemnity agreement or security reasonably satisfactory in form and amount to the Company or, in the case of any such mutilation, on surrender and cancellation of this Warrant, the Company at its expense will execute
and deliver, in lieu thereof, a new Warrant of like tenor. 

10. 

Warrant Agent. The Company may, by written notice to the each Holder of the Warrant, appoint an agent for the purpose of issuing Common Stock (or Other Securities) on the exercise of this Warrant pursuant to
Section 1, and replacing this Warrant pursuant to Section 9, or any of the foregoing, and thereafter any such issuance, exchange or replacement, as the case may be, shall be made at such office by such agent. 

11. 

Transfer on the Company’s Books. Until this Warrant is transferred on the books of the Company, the Company may treat the registered Holder hereof as the absolute owner hereof for all purposes,
notwithstanding any notice to the contrary. 

12. 

No Rights as Shareholder Until Exercise.  This Warrant does not entitle the Holder to any voting rights or other rights as a shareholder of the Company prior to the exercise hereof. 

13. 

Saturdays, Sundays, Holidays, etc. If the last or appointed day for the taking of any action or the expiration of any right required or granted herein shall be a Saturday, Sunday or a legal holiday, then such
action may be taken or such right may be exercised on the next succeeding day not a Saturday, Sunday or legal holiday. 

14. 

Notices, Etc.  All notices and other communications from the Company to the Holder shall be mailed by first class registered or certified mail, postage prepaid, at such address as may have been furnished to
the Company in writing by such Holder or, until any such Holder furnishes to the Company an address, then to, and at the address of, the last Holder who has so furnished an address to the Company. 

15. 

Miscellaneous. This Warrant and any term hereof may be changed, waived,
discharged or terminated only by an instrument in writing signed by the party
against which enforcement of such change, waiver, discharge or termination is
sought. THIS WARRANT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF STATE OF NEW YORK WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS. ANY
ACTION BROUGHT CONCERNING THE TRANSACTIONS CONTEMPLATED BY THIS WARRANT SHALL BE
BROUGHT ONLY IN THE STATE COURTS OF NEW YORK OR IN THE FEDERAL COURTS LOCATED IN
THE STATE OF NEW YORK; PROVIDED, HOWEVER, THAT THE HOLDER MAY CHOOSE TO WAIVE
THIS PROVISION AND BRING AN ACTION OUTSIDE THE STATE OF NEW YORK. The
individuals executing this Warrant on behalf of the Company agree to submit to
the jurisdiction of such courts and waive trial by jury. The prevailing party
shall be entitled to recover from the other party its reasonable attorneys’ fees
and costs. In the event that any provision of this Warrant 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.

6

 Any such provision which may prove invalid or
unenforceable under any law shall not affect the validity or enforceability of any other provision of this Warrant. The headings in this Warrant are for purposes of reference only, and shall not limit or otherwise affect any of the terms hereof. The
invalidity or unenforceability of any provision hereof shall in no way affect the validity or enforceability of any other provision hereof.  The Company acknowledges that legal counsel participated in the preparation of this Warrant and, therefore,
stipulates that the rule of construction that ambiguities are to be resolved against the drafting party shall not be applied in the interpretation of this Warrant to favor any party against the other party. 

[BALANCE OF PAGE INTENTIONALLY LEFT BLANK; 

SIGNATURE PAGE FOLLOWS] 

 

 

 

 

 

7

IN WITNESS WHEREOF, the Company has executed this Warrant as of the date first written above. 

 

LATIN AMERICA VENTURES, INC.

By:  ___________________________________

Name: Jorge Osvaldo Orellana Orellana

Title: Chief Executive Officer 

Exhibit A

FORM OF SUBSCRIPTION 

(To Be Signed Only On Exercise Of Warrant)

TO:

Latin America Ventures, Inc.

           
Attention: Chief Financial Officer

The undersigned, pursuant to the provisions set forth in the attached Warrant hereby irrevocably elects to purchase ____________shares of Common Stock covered by such Warrant, and is providing, herewith, the aggregate purchase price for
such shares. 

The undersigned intends that payment of the Warrant Price shall be made as (check one): 

Cash Exercise_______                                               
Cashless Exercise_______

If the Holder has elected a Cash Exercise, the Holder shall pay the sum of $________by certified or official bank check (or via wire transfer) to the Issuer in accordance with the terms of the Warrant. 

If the Holder has elected a Cashless Exercise, a certificate shall be issued to the Holder for the number of shares equal to the whole number portion of the product of the calculation set forth below, which is ___________.  The Company shall
pay a cash adjustment in respect of the fractional portion of the product of the calculation set forth below in an amount equal to the product of the fractional portion of such product and the VWAP of one share of Common Stock on the date of
exercise, which product is ____________. 

X = Y (B- A)

           
B

Where: 

The number of shares of Common Stock to be issued to the Holder __________________(“X”). 

The number of shares of Common Stock purchasable upon exercise of all of the Warrant or, if only a portion of the Warrant is being exercised, the portion of the Warrant being exercised ___________________________(“Y”). 

The Warrant Price ______________(“A”).

The 5-day average Fair Market Value of one share of Common Stock ______________________(“B”). 

The undersigned is an “accredited investor” as defined in Regulation D, as promulgated under the Securities Act of 1933, as amended. 

The undersigned represents and warrants that all offers and sales by the undersigned of the shares of Common Stock shall be made pursuant to registration of the Common Stock under the Securities Act of 1933, as amended (the “Securities
Act”) or pursuant to an exemption from registration under the Securities Act. 

	Dated:
    _______________________________	

_______________________________________

(Signature must conform to name of holder as

specified on the face of the Warrant) 

Address: ________________________________

_______________________________________

    

Exhibit B

FORM OF ASSIGNMENT 

(To assign the foregoing warrant, execute 

this form and supply required information.

Do not use this form to exercise the warrant.)

FOR VALUE RECEIVED, the foregoing Warrant and all rights evidenced thereby are hereby assigned to 

_______________________________________________whose address is
__________________________________________

Dated: ______________, _______

Holder’s Signature: __________________________________________

Holder’s Address: ___________________________________________

 

Signature Guaranteed:  ___________________________________________

NOTE: The signature to this Assignment Form must correspond with the name as it appears on the face of the Warrant, without alteration or enlargement or any change whatsoever, and must be guaranteed by a bank or trust company.  Officers of
corporations and those acting in a fiduciary or other representative capacity should file proper evidence of authority to assign the foregoing Warrant.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00173-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00173-of-00352.parquet"}]]