Document:

sbfm_ex109.htm

Exhibit 10.9

 

PATENT PURCHASE AGREEMENT

By and Between

SUNSHINE BIOPHARMA, INC.

And

ADVANOMICS CORPORATION

Dated as of October 8, 2015

  

  

  

PATENT PURCHASE AGREEMENT

THIS PATENT PURCHASE AGREEMENT (the “Agreement”), dated as of  October 8, 2015 (the “Effective Date”), is made by and between Sunshine Biopharma, Inc. a Colorado corporation (“Purchaser”), and Advanomics Corporation, a Canadian corporation (“Seller”), (collectively referred to herein as the “Parties” and individually as “Party”), who hereby agree as follows.

W I T N E S S E T H:

WHEREAS, Seller is the owner of U.S. Patent No. 8,236,935 (the “Assigned Patent”);

WHEREAS, the Parties have previously entered into that certain Patent License Agreement, pursuant to which Seller granted to Purchaser a license under the Assigned Patent (the “License Agreement”);

WHEREAS, Seller desires to sell to Purchaser all of Seller’s right, title and interest in and to the Assigned Patent and Purchaser, in turn, desires to acquire all such right, title and interest in and to the Assigned Patent (the “Transaction”);

WHEREAS, the Board of Directors of Purchaser and Seller have unanimously approved the Transaction upon the terms and subject to the conditions and limitations set forth in this Agreement in accordance with the laws of their respective jurisdictions;

WHEREAS, the shareholders of the Seller have approved the Transaction pursuant to the laws of its jurisdiction of incorporation; and

WHEREAS, Purchaser and Seller desire to consummate the Transaction, terminate the License Agreement and make certain representations, warranties, covenants and agreements in connection with the Transaction;

NOW, THEREFORE, in consideration of the foregoing and the mutual representations, warranties and covenants and subject to the conditions herein contained, and intending to be legally bound hereby, the Parties hereby agree as follows:

ARTICLE I

DEFINITIONS

Section 1.1                      Definitions.  Defined terms used in this Agreement have the respective meanings ascribed to them by definition in this Agreement.

  

  

  

 

ARTICLE II

PATENT SALE, TRANSFER AND ASSIGNMENT

Section 2.1                      Sale of Assigned Patent.  The Seller hereby sells, transfers and assigns all of its rights, title and interest in and to: (i) the Assigned Patent, (ii) all damages based upon past, present and future infringement of the Assigned Patent, and (iii) all rights to enforce the Assigned Patent and to sue for, collect and retain any and all damages for past, present and future infringement of the Assigned Patent to the Purchaser, and the Purchaser hereby accepts such sale, transfer and assignment and agrees to pay for the Assigned Patent the Purchase Price as set forth herein below.

 

Section 2.2                      Purchase Price.  The purchase price to be paid by Purchaser to Seller for the Assigned Patent is Four Million Three Hundred and Twenty Thousand U.S. Dollars ($4,320,000) (the “Purchase Price”), which shall be payable in Twelve (12) equal annual installments of Three Hundred Sixty Thousand Dollars ($360,000.00) per payment due and payable on or before December 31 of each calendar year, with the first payment being due and payable on or before December 31, 2016.  This obligation shall be memorialized in that certain Secured Promissory Note in the principal amount of the Purchase Price (“Promissory Note”), a copy of which together with a copy of the pertinent Security Agreement (“Security Agreement”) are attached hereto and incorporated herein as Exhibit “A-1” and “A-2”.

Section 2.3                      Deliverables.  At the time of execution of this Agreement, the following actions shall take place, all of which shall be deemed to have occurred simultaneously, and no action shall be deemed to have been completed or any document delivered until all such actions have been completed and all required documents delivered:

(a)           Seller will deliver, or will cause to be delivered, to Purchaser the Assigned Patent Files, including all originals of all certificates and assignment documents in Seller’s possession or control.

(b)           Purchaser will deliver, or will cause to be delivered, to Seller an executed copy of the Secured Promissory Note and Security Agreement together with all documentation lawfully required to allow Seller to “perfect” its security interest (together with this Agreement jointly referred to as the “Transaction Documents”).

Section 2.4                      Effective Date.  This Agreement shall be effective the Effective Date.

ARTICLE III

REPRESENTATIONS AND WARRANTIES OF SELLER

Seller hereby represents and warrants to Purchaser as follows:

Section 3.1                      Organization.  Seller is a corporation duly organized, validly existing and in good standing, under the laws of the Federal Government of Canada.

 

  

  

  

 

Section 3.2                      Ownership of the Assigned Patent and Contest.  (A) Seller owns all rights, title and interest in and to the Assigned Patent free and clear of any Liens and has the right and power to assign the Assigned Patent to Purchaser free and clear of any Liens except to the Seller as specified in this Agreement.  There are no actions, suits, claims or proceedings to which Seller is a party that is pending or, to the knowledge of Seller, threatened, to the knowledge of Seller there is no investigation pending, and Seller has not received written communications or correspondence in the twelve (12) months prior to the date hereof that (a) challenges the validity, enforcement, construction, use or ownership of the Assigned Patent.  There are no orders, decisions, injunctions, judgments, decrees or rulings enacted, adopted, promulgated or applied by a Governmental Authority binding the Seller or, to the knowledge of Seller, any of its properties comprising any portion of the Assigned Patent, which (i) restrict any of Seller’s rights, or would, to the knowledge of Seller, restrict any of Purchaser’s, or any of its successors’ and assigns’ rights, in or to the Assigned Patent.  There is no current suit, action or proceeding to which Seller or any of its Affiliates is a party or, to the knowledge of Seller, any other current suit, action or proceeding in which any third party has asserted that the Assigned Patent is not solely owned by Seller, that the Assigned Patent may not be assigned to Purchaser on the terms set forth in the Transaction Documents.  No Affiliate of Seller is the owner or exclusive licensee of the Assigned Patent.  Notwithstanding any of the foregoing, actions and other determinations received from the USPTO or equivalent patent agencies in foreign jurisdictions in the ordinary course of patent prosecution shall not be deemed, in and of itself, to render inaccurate any of the representations or warranties set forth in this Section 3.2.

Section 3.3                      Authority Relative to Agreements.  Seller has all necessary corporate power and authority, and has taken all corporate actions necessary including the requisite Board of Directors and Stockholder approval, to execute and deliver this Agreement and the other Transaction Documents, to perform its obligations hereunder and thereunder and to consummate the Transaction in accordance with the terms hereof and thereof.  The execution and delivery of this Agreement and each of the other Transaction Documents by Seller and the consummation by Seller of the Transaction contemplated hereby and thereby, including without limitation the Patent Sale, have been unanimously approved by the Board of Directors of Seller and otherwise duly and validly authorized by all necessary corporate action, and no other corporate or other organizational proceedings on the part of Seller are necessary to authorize the execution and delivery of this Agreement or the other Transaction Documents or to consummate the Transaction contemplated hereby and thereby, including without limitation the Patent Sale. This Agreement has been and each of the other Transaction Documents when executed will be duly and validly executed and delivered by Seller, and, assuming the due authorization, execution and delivery of this Agreement and each of the other Transaction Documents by Purchaser, constitute (or when executed will constitute) valid, legal and binding agreements and obligations of Seller enforceable against Seller in accordance with their terms, except as such enforceability may be limited by bankruptcy, insolvency, moratorium and other similar Laws affecting creditors’ rights generally and by general principles of equity.

Section 3.4                      No Conflict; Required Filings and Consents.  None of the execution and delivery of this Agreement or any of the other Transaction Documents by Seller, the consummation by Seller of the Patent Sale or any other transaction contemplated hereby and thereby, or Seller’s compliance with any of the provisions of this Agreement or such other Transaction Documents will (a)  conflict with or violate the Seller Charter Documents, (b) except for filings, if any, required to be made under any applicable U.S. or foreign competition, antitrust, Patent Sale control or investment Laws that require Seller to make or obtain any filing with or any permit, authorization, consent or approval of any Governmental Authority or other person, (c) result in a material breach, violation or infringement of, or constitute (with or without due notice or lapse of time or both) a material default (or give rise to the creation of any material Lien or any right of termination, amendment, cancellation or acceleration) under, any of the terms, conditions or provisions of any material contract to which Seller is a party or by which Seller or any of its properties or assets are bound which affect the Assigned Patent or the Transaction, or (d) violate any applicable law, other than, in the case of clauses (c) and (d), any such breach, violation, infringement, default, right, termination, amendment, acceleration, cancellation or Lien that would not have, individually or in the aggregate, a material effect on the Assigned Patent which, on or after the Patent Sale Closing, would be reasonably likely to result in Purchaser being deprived of a significant portion of the value of the Transaction.

 

  

  

  

 

Section 3.5                      Assigned Patent Documentation.  Seller has provided Purchaser with, or made available to Purchaser, true and correct copies of all material pertaining to the Assigned Patent.  Seller has made the Assigned Patent files available for Purchaser’s review at Seller’s place of business that is in Seller’s possession or of which Seller has knowledge, subject to redaction of financial and other sensitive terms that do not impact title or rights in or to the Assigned Patent and do not impact any obligations or liability on Purchaser.

Section 3.6                      Third-Party Agreements.  Seller has made available to Purchaser copies of all Third-Party Agreements pertaining to the Assigned Patent and such copies are true and correct in all material respects.

Section 3.7                      Information Supplied.  None of the information supplied or to be supplied by or on behalf of Seller contains any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they are made, not misleading.

Section 3.9                      No Exclusive Licenses.  No exclusive licenses or other rights other than those in the License Agreement have been granted by Seller or any of its Affiliates under the Assigned Patent.

Section 3.10                      No Other Representations or Warranties.  Except for the representations and warranties contained in this Article III or in the other Transaction Documents, none of Seller, its Affiliates or any other person on behalf of Seller makes any express or implied representation or warranty with respect to Seller or its Affiliates or with respect to any other information provided to Purchaser in connection with the Transaction contemplated hereby, including the accuracy, completeness or currency thereof.  Except in the case of fraud, none of Seller, its Affiliates or any other person will have or be subject to any liability or indemnification obligation to Purchaser or any other person resulting from the distribution or failure to distribute to Purchaser, or Purchaser’s use of, any such information, including any information, documents, projections, forecasts or other material made available to Purchaser, management presentations in expectation of the Transaction contemplated by this Agreement or otherwise, unless and to the extent any such information is expressly included in a representation or warranty contained in this Article III.

  

  

  

ARTICLE IV

REPRESENTATIONS AND WARRANTIES OF PURCHASER

Purchaser hereby represents and warrants to Seller as follows:

Section 4.1                      Organization.  Purchaser is a corporation duly organized, validly existing and in good standing, under the laws of the State of Colorado.

Section 4.2                      Authority Relative to Agreement.  Purchaser has all necessary organizational power and authority, and has taken all corporate action necessary, to execute and deliver this Agreement and the other Transaction Documents, to perform its obligations hereunder and thereunder and to consummate the Transaction in accordance with the terms hereof and thereof.  The execution and delivery of this Agreement and each of the other Transaction Documents by Purchaser and the consummation by Purchaser of the Transaction contemplated hereby and thereby, including without limitation the Patent Sale, have been approved by the Board of Directors of Purchaser and otherwise duly and validly authorized by all necessary corporate action of Purchaser, and no other organizational proceedings on the part of Purchaser are necessary to authorize the execution and delivery of this Agreement or the other Transaction Documents or to consummate the Transaction contemplated hereby and thereby, including the Patent Sale.  This Agreement has been, and each of the other Transaction Documents when executed will be, duly and validly executed and delivered by Purchaser, and, assuming the due authorization, execution and delivery of this Agreement and each of the other Transaction Documents by Seller or applicable Affiliate(s) of Seller, constitute (or when executed will constitute) valid, legal and binding agreements and obligations of Purchaser, enforceable against Purchaser in accordance with their terms, except as such enforceability may be limited by bankruptcy, insolvency, moratorium and other similar Laws affecting creditor’s rights generally and by general principles of equity.

Section 4.3                      No Conflict; Required Filings and Consents.  Neither the execution and delivery of this Agreement nor any other Transaction Document or, the consummation by Purchaser of the Patent Sale or any other transaction contemplated hereby and thereby, or Purchaser’s compliance with any of the provisions of this Agreement or such other Transaction Documents will (a) conflict with or violate the organizational or governing documents of Purchaser, as amended to date; (b) require Purchaser to make or obtain any filing with or any permit, authorization, consent or approval of any Governmental Authority or other person; (c) result in a material breach, violation or infringement of, or constitute (with or without due notice or lapse of time or both) a material default (or give rise to the creation of any material Lien or any right of termination, amendment, cancellation or acceleration) under, any of the terms, conditions or provisions of any material contract to which Purchaser is a party or by which Purchaser or any of its assets may be bound which affect the Assigned Patent or the Transaction; or (d) violate any applicable Law.

 

  

  

  

 

Section 4.4                      Acknowledgement of Disclaimer of Other Representations and Warranties.  Purchaser acknowledges that, as of the date hereof, it and its Representatives (a) have except as set forth in this Agreement received full access to Seller’s files and records relating to the Assigned Patent, including the Patent Documentation, which they and their Representatives, as of the date hereof, have requested to review, and (b) have had full opportunity to evaluate the Assigned Patent and to review publicly-available information regarding the Assigned Patent.  Purchaser further acknowledges and agrees that, except for the representations and warranties expressly set forth in this Agreement (A) neither Seller nor any of its Affiliates makes, or has made, any representation or warranty relating to the Assigned Patent or this Agreement and Purchaser is not relying on any representation or warranty except for those expressly set forth in this Agreement; (B) no person has been authorized by Seller to make any representation or warranty relating to itself or the Assigned Patent or otherwise in connection with this Agreement, and if made, such representation or warranty must not be relied upon by Purchaser as having been authorized by Seller; and (C) any estimate, projection, prediction, data, opinions, financial information, memorandum, presentation or any other materials or information provided or addressed to Purchaser or any of its representatives are not and shall not be deemed to be or include representations or warranties unless and to the extent any such materials or information is the subject of any express representation or warranty set forth in Article III.  Purchaser acknowledges that it has conducted to its satisfaction, its own independent investigation of the scope, history and value of the Assigned Patent.  Without limiting the foregoing, Seller hereby disclaims any warranty (1) that the Assigned Patent could not be invalidated or otherwise become the subject of proceedings challenging Seller’s rights with respect to the Assigned Patent, (2) of merchantability or fitness for a particular purpose, or (3) that the manufacture, use, sale, importation or other exploitation of any products, technology or services will not be the subject of any third-party Intellectual Property infringement claims (whether or not such products, technology or services are covered by the claims of the Assigned Patent).

ARTICLE V

TERMINATION OF LICENSE AGREEMENT

Section 5.1                      The parties hereto hereby agree that the License Agreement between the Parties dated August 20, 2009 together with all amendments thereto shall terminate on the Effective Date and Purchaser shall be responsible for all license fees due thereunder on a pro rata basis.

  

  

  

ARTICLE VI

INDEMNIFICATION

Section 6.1                      Indemnification Obligations of Seller.  Subject to the limitations set forth in this Article VI, Seller shall indemnify Purchaser and its Affiliates, directors, officers, employees, agents and Representatives (collectively, the “Purchaser Indemnified Parties”) and hold each of them harmless against any direct loss, liability, cost, damage or expense (including reasonable expenses of investigation and reasonable attorneys’ fees and expenses, but excluding any consequential, indirect, special, incidental or punitive damages or lost profits (collectively, “Losses”), suffered by any such Purchaser Indemnified Party in connection with (i) any inaccuracy of any representation or warranty of Seller under this Agreement or (ii) any breach of any covenant or agreement of Seller under this Agreement.  The representations and warranties of Seller under this Agreement shall be deemed to have been made as of the Effective Date (unless expressly made as of another date).

Section 6.2                      Claims.  In the event that a Purchaser Indemnified Party seeks to exercise its rights to obtain indemnification for Losses pursuant to the terms of this Article VI, such indemnified party shall deliver to the indemnifying person a certificate signed by an officer of such indemnified party certifying that such indemnified party has incurred, paid, sustained, reserved, or accrued, or reasonably anticipates that it may incur, pay, sustain, reserve or accrue, Losses and specifying in reasonable detail the nature of the breach or other claim and the amount of such Losses for which indemnification is being sought (each such certificate, a “Claim Notice”).  Each Claim Notice shall also include wire instructions for the delivery of funds to the indemnified person or its designee.  In the event the claim or claims set forth in a Claim Notice is (A) not contested by the indemnifying person as of the close of business on the twentieth (20th) day following delivery of such Claim Notice, or (B) agreed to in writing by the indemnifying person in advance of the expiration of such twenty (20)-day period, the indemnifying person shall be deemed to have accepted and agreed to the claims set forth in such Claim Notice and precluded from raising any objection thereafter and such claim shall be deemed final, binding and conclusive for all purposes.  The indemnifying person shall have the right to object to one or more of the claims set forth in any Claim Notice delivered by the indemnified party to the indemnifying person by serving written notice thereof within twenty (20) days following the delivery of such Claim Notice, which notice shall specify in reasonable detail the basis for such objection.  In the event that the indemnifying person shall so object in writing to any claim or claims by an indemnified party in any Claim Notice, the indemnified party shall have fifteen (15) days after receipt to such objection by the indemnifying person to respond thereto in a written statement, failing which the indemnified parties shall be deemed to have accepted the objections raised by the indemnifying person and such claim shall be deemed to be final, binding and conclusive for all purposes.  As promptly as practicable, and in any event no later than Ten (10) Business Days, following the date on which a claim becomes final and binding pursuant to this Section 6.2, the indemnifying person shall pay the full amount of such claim by wire transfer of immediately available funds to the account designated by the indemnified party, subject to the limitations of this Article VI.

Section 6.3                      Sole Remedy; Limitation of Damages.  From and after the Patent Sale Closing, except for specific performance and any other equitable remedy, the indemnification provisions set forth in this Article VI shall be the sole remedy for either Party with respect to this Agreement or any matter arising out of or relating hereto (other than with respect to Post-Closing Covenants).  Neither Party shall be liable for special, incidental, indirect or consequential damages or lost profits with respect to this Agreement or any matter arising out of or relating hereto.

 

  

  

  

 

ARTICLE VII

GENERAL PROVISIONS

Section 7.1                      Notices.  Any notice required to be given hereunder shall be sufficient if in writing by reliable overnight delivery service (with proof of delivery) or by certified or registered mail (return receipt requested), addressed as follows (or at such other address for a Party as shall be specified in a notice given in accordance with this Section 9.1):

(a)           if to Purchaser:                                      Dr. Abderrazzak Merzouki, COO

Sunshine Biopharma Inc.

469 Jean-Talon West, 3rd Floor

Montreal, Quebec H3N 1R4

Canada

Phone: 514-764-9698

Fax:           514-764-9699

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

Andrew I. Telsey, Esq.

Andrew I. Telsey, P.C.

12835 E. Arapahoe Road

Tower One, Suite 803

Centennial, CO  80112

Phone: (303) 768-9221

Fax: (303) 768-9224

(b)           if to Seller:                                              Mr. Camille Sebaaly, Director

Advanomics Corporation

579 Lajeunesse Street

Laval, Quebec H7X 3K4

Canada                      

Phone:  514-814-0464

Fax:           450-689-6397

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

Mr. Frank Tutino

Tutino Joseph Grégoire

1080 Beaver Hall, Suite 600

Montréal, Québec H2Z 1S8

Canada

Phone:  514 878-3878

Fax:  514 878-9890

  

  

  

Section 7.2                      Interpretation; Certain Definitions.  The Parties have participated jointly in the negotiation and drafting of this Agreement.  Consequently, in the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the Parties, and no presumption or burden of proof shall arise favoring or disfavoring any Party by virtue of the authorship of any provision of this Agreement.  When a reference is made in this Agreement to an Article, Section, Appendix, Annex or Exhibit, such reference shall be to an Article or Section of, or an Appendix, Annex or Exhibit to, this Agreement, unless otherwise indicated and shall not affect in any way the meaning or interpretation of this Agreement.  Whenever the words “include,” “includes” or “including” are used in this Agreement, they shall be deemed to be followed by the words “without limitation.”  The words “hereof,” “herein” and “hereunder” and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement.  All terms defined in this Agreement shall have the defined meanings when used in any certificate or other document made or delivered pursuant hereto unless otherwise defined therein.  The definitions contained in this Agreement are applicable to the singular as well as the plural forms of such terms and to the masculine as well as to the feminine and neuter genders of such term.  Any Law defined or referred to herein or in any agreement or instrument that is referred to herein means such Law as from time to time amended, modified or supplemented, including (in the case of statutes) by succession of comparable successor Laws.  References to a person are also to its successors and permitted assigns. All references to “dollars” or “$” refer to currency of the United States of America.

Section 7.3                      Severability. If any term or other provision of this Agreement is invalid, illegal or incapable of being enforced under any present or future Law, or public policy, (a) such term or other provision shall be fully separable; (b) this Agreement shall be construed and enforced as if such invalid, illegal or unenforceable provision had never comprised a part hereof; and (c) all other conditions and provisions of this Agreement shall remain in full force and effect and shall not be affected by the illegal, invalid or unenforceable term or other provision or by its severance herefrom so long as the economic or legal substance of the Patent Sale is not affected in any manner materially adverse to any Party.  Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced, the Parties shall negotiate in good faith to modify this Agreement so as to effect the original intent of the Parties as closely as possible in a mutually acceptable manner in order that the Patent Sale be consummated as originally contemplated to the fullest extent possible.

Section 7.4                      Entire Agreement.  This Agreement (including the exhibits, annexes and appendices hereto) constitutes the entire agreement, and supersedes all other prior agreements and understandings, both written and oral, between the Parties with respect to the subject matter hereof.

Section 7.5                      No Third-Party Beneficiaries.  This Agreement is not intended to and shall not confer any rights or remedies upon any person other than the Parties and their respective successors and permitted assigns.  The representations and warranties in this Agreement are the product of negotiations among the Parties and are for the sole benefit of the Indemnified Parties.

 

  

  

  

 

Section 7.6                      Governing Law.  This Agreement and all actions, proceedings or counterclaims (whether based on contract, tort or otherwise) arising out of or relating to this Agreement or the actions of Purchaser or Seller in the negotiation, administration, performance and enforcement thereof, shall be governed by, and construed in accordance with the laws of the Province of Quebec (Canada), without giving effect to any choice or conflict of laws provision or rule that would cause the application of the Laws of any jurisdiction other than the Province of Quebec (Canada).

Section 7.7                      Specific Performance.  The Parties agree that irreparable damage for which monetary damages, even if available, would not be an adequate remedy, would occur in the event that the Parties do not perform the provisions of this Agreement (including failing to take such actions as are required of it hereunder to consummate this Agreement) in accordance with its specified terms or otherwise breach such provisions. Accordingly, the Parties acknowledge and agree that the Parties shall be entitled to an injunction, specific performance and other equitable relief to prevent breaches of this Agreement and to enforce specifically the terms and provisions hereof, in addition to any other remedy to which they are entitled at law or in equity.  Each of the Parties agrees that it will not oppose the granting of an injunction, specific performance and other equitable relief on the basis that the other Party has an adequate remedy at law or that any award of specific performance is not an appropriate remedy for any reason at law or in equity.  Any Party seeking an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions of this Agreement shall not be required to provide any bond or other security in connection with any such order or injunction.

Section 7.8                      Counterparts.  This Agreement may be executed in one or more counterparts, and by the Parties in separate counterparts, each of which when executed shall be deemed to be an original but all of which taken together shall constitute one and the same agreement.  Delivery of an executed counterpart of a signature page to this Agreement by facsimile transmission or by e-mail of a .pdf attachment shall be effective as delivery of a manually executed counterpart of this Agreement.

Section 7.9                      Canadian Language Requirement..  The Parties hereto have agreed to execute this Agreement in the English language.

(balance of page intentionally left blank – signature page follows)

 

  

  

  

 

IN WITNESS WHEREOF, Purchaser and Seller have caused this Agreement to be executed as of the date first written above by their respective officers thereunto duly authorized.

	  	
SUNSHINE BIOPHARMA, INC.

 

 

	  	
By: s/ Dr. Abderrazzak Merzouk

	  	
Name:  Dr. Abderrazzak Merzouki

	  	
Title: Chief Operating Officer

	  	
 

 

ADVANOMICS CORPORATION

 

 

By: s/ Camille Sebaaly

	  	 
Name: Camille Sebaaly

Title: DirectorExhibit 4.1

  

THE SECURITIES EVIDENCED BY THIS WARRANT CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND MAY NOT BE SOLD, TRANSFERRED, OR ASSIGNED, UNLESS THERE IS AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT COVERING SUCH SECURITIES, OR THE SALE IS MADE IN ACCORDANCE WITH RULE 144 UNDER
THE SECURITIES ACT OR PURSUANT TO AN EXEMPTION UNDER THE SECURITIES ACT.

 

	Warrant Stock: ___________	Date: ____________ (the “Date”)

  

 

WARRANT

TO PURCHASE CLASS B COMMON STOCK

OF

RMR INDUSTRIALS, INC. 

 

 

1.     
Issuance of Warrant. FOR VALUE RECEIVED, on and after the date of issuance of this Warrant, and subject to
the terms and conditions herein set forth, ______ (“Holder”) is entitled to purchase from RMR Industrials, Inc.,
a Nevada corporation (the “Company”), at any time during the Exercise Period (as defined below), at a price
per share equal to the Warrant Price (as defined below and subject to adjustment as described below), the Warrant Stock (as defined
below and subject to adjustment as described below) upon exercise of this warrant (this “Warrant”) pursuant
to Section 6 hereof. This Warrant is being issued pursuant to the terms of the Subscription Agreement, dated as of even date herewith
by and between the Company and the Holder (the “Agreement”). Capitalized terms not otherwise defined herein
shall have the meanings given to them in the Agreement.

 

2.     
Definitions. As used in this Warrant, the following terms have the definitions ascribed to them below:

 

(a)   
 “Common Stock” means the Class B Common Stock, $0.001 par value, of the Company.

 

(b)  
 “Exercise Period” means the period commencing on the Date and ending at 5:00 p.m. Pacific Standard Time
on the Termination Date (as defined below); provided, however, the Exercise Period shall end and this Warrant shall
no longer be exercisable and shall become null and void (except the right to receive the securities and property to which the Holder
is entitled by virtue of exercising or converting this Warrant in connection with any Termination Event) upon consummation of any
of the following (each, a “Termination Event”): (i) the lease of all or substantially all of the assets of the
Company or the exclusive license of all or substantially all of the Company’s intellectual property to a third party, (ii)
the acquisition of the Company by another entity by means of any transaction or series of related transactions (including without
limitation, any reorganization, merger or consolidation, but excluding any merger or conversion effected exclusively for the purpose
of changing the domicile of the Company), (iii) the sale, conveyance or disposal of all or substantially all of the assets of the
Company, unless the Company’s shareholders of record as constituted immediately prior to such acquisition or sale will, immediately
after such acquisition or sale (by virtue of securities issued as consideration for the Company’s acquisition or sale or
otherwise) hold at least fifty percent (50%) of the voting power of the surviving or acquiring entity, or (iv) upon redemption
by the Company under Section 7 of this Warrant. Notwithstanding anything to the contrary herein, this Warrant shall continue in
full force and effect until the Termination Date unless (y) no less than thirty (30) days prior to any Termination Event, the Company
shall have given the Holder notice of such Termination Event, which notice shall include a reasonably detailed description of the
terms of such Termination Event, and (z) the Company shall have given the Holder a reasonable opportunity to exercise or convert
this Warrant.

 

     

     

    

 

(c)   
 “Termination Date” means five (5) years from the Date.

 

(d)  
“Warrant Price” means a price per Warrant Stock equal to $12.50, subject to adjustment hereunder.

 

(e)   
“Warrant Stock” means the shares of Common Stock purchasable upon exercise of this Warrant.

 

3.     
Adjustments and Notices. The Warrant Price and the number of shares of Warrant Stock shall be subject to adjustment
from time to time in accordance with this Section 3.

 

(a)   
Adjustments to Warrant Stock. When any adjustment is required to be made to the Warrant Price, the number of shares
of Warrant Stock purchasable upon the exercise of this Warrant shall be changed to the number determined by dividing (i) an
amount equal to the number of shares issuable upon the exercise of this Warrant immediately prior to such adjustment, multiplied
by the Warrant Price in effect immediately prior to such adjustment, by (ii) the Warrant Price in effect immediately after
such adjustment.

 

(b)  
Reclassification, Exchange, Substitution, In-Kind Distribution. Upon any reclassifications, exchange, substitution
or other event that results in a change of the number and/or class of the securities issuable upon exercise of this Warrant or
upon the payment of a dividend in securities or property other than shares of Common Stock, the Holder shall be entitled to receive,
upon exercise of this Warrant, the number and kind of securities and property that Holder would have received if this Warrant had
been exercised or converted immediately before the record date for such reclassification, exchange, substitution, or other event
or immediately prior to the record date for such dividend. The Company or its successor shall promptly issue to Holder a new warrant
for such new securities or other property. The new warrant shall provide for adjustments which shall be as nearly equivalent as
may be practicable to the adjustments provided for in this Warrant. The provisions of this Section 3(b) shall similarly apply to
successive reclassifications, exchanges, substitutions, or other events and successive dividends.

 

(c)   
Certificate of Adjustment. In each case of an adjustment or readjustment of the Warrant Price, the Company, at its
own expense, shall compute such adjustment or readjustment in accordance with the provisions hereof and prepare a certificate executed
by the Company’s Chief Financial Officer showing such adjustment or readjustment, and shall mail such certificate, by first
class mail, postage prepaid, to the Holder.

 

(d)  
No Impairment. The Company shall not, by amendment of its Articles of Incorporation or through a reorganization,
transfer of assets, consolidation, dissolution, issue, or sale of securities or any other voluntary action, avoid or seek to avoid
the observance or performance of any of the terms to be observed or performed under this Warrant by the Company, but shall at all
times in good faith assist in carrying out all of the provisions of this Section 3 and in taking all such action as may be necessary
or appropriate to protect the Holder’s rights under this Section 3 against impairment.

 

(e)   
Fractional Shares. No fractional shares shall be issuable upon exercise or conversion of the Warrant and the number
of shares to be issued shall be rounded to the nearest whole share. If a fractional share interest arises upon any exercise or
conversion of the Warrant, the Company shall eliminate such fractional share interest by paying the Holder an amount computed by
multiplying the fractional interest by the fair market value of a full share.

 

     

     

    

 

4.     
Reservation of Stock. On and after the Date, the Company shall reserve from its authorized and unissued Common Stock
a sufficient number of shares to provide for the issuance of Warrant Stock upon the exercise or conversion of this Warrant. Issuance
of this Warrant shall constitute full authority to the Company’s officers who are charged with the duty of executing stock
certificates to execute and issue the necessary certificates for shares of Warrant Stock issuable upon the exercise or conversion
of this Warrant.

 

5.     
Exercise of Warrant.

 

(a)   
This Warrant may be exercised as a whole or part by the Holder, at any time after the date hereof prior to the termination
of this Warrant, by the surrender of this Warrant, together with the Notice of Exercise and Investment Representation Statement
in the forms attached hereto as Attachments 1 and 2, respectively, duly completed and delivered to the principal office
of the Company, specifying the portion of the Warrant to be exercised and accompanied by payment in full of the Warrant Price in
cash or by check with respect to the shares of Warrant Stock being purchased. This Warrant shall be deemed to have been exercised
immediately prior to the close of business on the date of its surrender for exercise as provided above, and the person entitled
to receive the shares of Warrant Stock issuable upon such exercise shall be treated for all purposes as the holder of such shares
of record as of the close of business on such date. As promptly as practicable after such date, the Company shall issue and deliver
to the person or persons entitled to receive the same a certificate or certificates for the number of full shares of Warrant Stock
issuable upon such exercise. If this Warrant shall be exercised for less than the total number of shares of Warrant Stock then
issuable upon exercise, promptly after surrender of this Warrant upon such exercise, the Company will execute and deliver a new
warrant, dated the date hereof, evidencing the right of the Holder to the balance of this Warrant Stock purchasable hereunder upon
the same terms and conditions set forth herein.

 

(b)  
Notwithstanding anything to the contrary contained in this Warrant, this Warrant shall not be exercisable by the Holder
hereof to the extent (but only to the extent) necessary to ensure that, following such exercise, the total number of shares of
Common Stock then beneficially owned by Holder and its affiliates and any other persons whose beneficial ownership of Common Stock
would be aggregated with the Holder’s for purposes of Section 13(d) of the Exchange Act, does not exceed 4.999% of the total
number of issued and outstanding shares of Company Common Stock. For such purposes, beneficial ownership shall be determined in
accordance with Section 13(d) of the Exchange Act and the rules and regulations thereunder. Notwithstanding the foregoing, Holder
may waive such limitation on exercise contained in this Section 5(b) or increase or decrease such limitation percentage to any
other percentage as specified in a written notice to the Company no less than sixty (60) days from the effective date of such increase
or decrease.

 

(c)   
If at any time after the six (6) month anniversary of the Date, there is no effective Registration Statement registering,
or no current prospectus available for, the resale of the Warrant Stock by the Holder, then this Warrant may also be exercised,
in whole or in part, at such time by means of a “cashless exercise” in which the Holder shall be entitled to receive
a number of Warrant Stock equal to the quotient obtained by dividing [(A-B) (X)] by (A), where:

 

(A) = the
volume weighted average price (“VWAP”) on the business day immediately preceding the date on which Holder elects
to exercise this Warrant by means of a “cashless exercise,” as set forth in the applicable Notice of Exercise;

 

(B) = the Warrant Price of this
Warrant, as adjusted hereunder; and

 

     

     

    

 

(X) =
the number of Warrant Stock that would be issuable upon exercise of this Warrant in accordance with the terms of this Warrant if
such exercise were by means of a cash exercise rather than a cashless exercise.

 

Notwithstanding anything herein
to the contrary, on the Termination Date, this Warrant shall be automatically exercised via cashless exercise pursuant to this
Section 5(c).

 

6.     
Transfer of Warrant. Notwithstanding anything to the contrary herein, subject to applicable securities laws, this
Warrant may be transferred or assigned in whole or in part by the Holder, and the Company shall permit such transfer or assignment
to an affiliate of the Holder.

 

7.     
Redemption

 

(a)   
Warrants may be redeemed, at the option of the Company, at any time after they become exercisable and prior to the Termination
Date, upon the notice referred to in Section 7(b) at the price of $0.01 per Warrant (the “Redemption Price”),
provided, however, that (a) (i) the last reported sales price of the Common Stock is equal to or greater than 125% of the then
applicable Warrant Price on the third business day prior to the notice of redemption to the Holder, and (ii) the Common Stock is
quoted on or listed for trading on either The New York Stock Exchange, The Nasdaq
Global Market, The NASDAQ Capital Market, The Nasdaq Global Select Market or the
NYSE MKT, or (b) the last reported sales price of the Common Stock has been equal to or greater than 125% of the then applicable
Warrant Price for each trading day in the 20-trading-day period ending on the third business day prior to the notice of redemption
to the Holder, and in each case, there is an effective registration statement covering the Warrant Stock current and available.

 

(b)  
In the event the Company shall elect to redeem the Warrant, the Company shall fix a date for the redemption. Notice of redemption
shall be mailed by first class mail, postage prepaid, by the Company not less than 30 days prior to the date fixed for redemption
to the Holder at their last addresses as they shall appear on the registration books. Any notice mailed in the manner herein provided
shall be conclusively presumed to have been duly given on the date sent whether or not the Holder received such notice.

 

(c)   
The Warrant may be exercised for cash in accordance with Section 5 of this Warrant at any time after notice of redemption
shall have been given by the Company and prior to the time and date fixed for redemption. On and after the redemption date, the
record holder of the Warrant shall have no further rights except to receive the Redemption Price upon surrender of the Warrant.

 

(d)  
The Company understands that the redemption rights provided for by this Section 7 apply only to outstanding Warrants. To
the extent a person holds rights to purchase Warrant, such purchase rights shall not be extinguished by redemption. However, once
such purchase rights are exercised, the Company may redeem the Warrant issued upon such exercise provided that the criteria for
redemption is met, including the opportunity of the holders to exercise prior to redemption pursuant to Section 7.

 

8.     
Termination. This Warrant shall terminate at 5:00 p.m. Pacific Standard Time on the Termination Date, subject to
earlier termination as set forth in Section 2(c) hereof.

 

9.     
Miscellaneous. This Warrant shall be governed by the laws of the State of Nevada, as such laws are applied to contracts
to be entered into and performed entirely in Nevada. In the event of any dispute among the Holder and the Company arising out of
the terms of this Warrant, the parties hereby consent to the exclusive jurisdiction of the federal and state courts located in
the State of Nevada for resolution of such dispute, and agree not to contest such exclusive jurisdiction or seek to transfer any
action relating to such dispute to any other jurisdiction. The headings in this Warrant are for purposes of convenience and reference
only, and shall not be deemed to constitute a part hereof. Neither this Warrant nor any term hereof may be changed or waived orally,
but only by an instrument in writing signed by the Company and the Holder of this Warrant.

 

	 	RMR Industrials, Inc.

 

	 	
        By: 

        

        
	 
	 		Name: Gregory M. Dangler
	 		Title: President

 

     

     

    

 

ATTACHMENT 1

 

NOTICE OF EXERCISE

 

		To:	RMR INDUSTRIALS,
Inc.

 

(1)  
The undersigned hereby elects to purchase ________ Warrant Stock of the Company pursuant to
the terms of the attached Warrant (only if exercised in full), and tenders herewith payment of the exercise price in full, together
with all applicable transfer taxes, if any.

 

(2)  
Payment shall take the form of (check applicable box):

 

[ ] in lawful
money of the United States; or

 

[ ] [if permitted
the cancellation of such number of Warrant Stock as is necessary, in accordance with the formula set forth in Section 5(c), to
exercise this Warrant with respect to the maximum number of Warrant Stock purchasable pursuant to the cashless exercise procedure
set forth in Section 5(c).

 

(3)  
Please issue said Warrant Stock in the name of the undersigned or in such other name as is
specified below:

 

_______________________________

 

 

The Warrant Stock shall be delivered to the following DWAC Account
Number:

 

_______________________________

 

_______________________________

 

_______________________________

 

 

[SIGNATURE OF HOLDER]

 

	Name of Investing Entity: 	 

	Signature of Authorized Signatory of Investing Entity: 	 

	Name of Authorized Signatory: 	 

	Title of Authorized Signatory:	 

	Date: 	 

 

     

     

    

 

ATTACHMENT 2

 

INVESTMENT REPRESENTATION STATEMENT

 

 

Shares of Common Stock of RMR Industrials,
Inc., a Nevada corporation (the “Company”)

 

In connection with
the purchase of the above-listed securities, the undersigned hereby represents to the Company as follows:

 

(a)               
The securities to be received upon the exercise of the Warrant (the “Securities”) will be acquired for investment
for its own account, not as a nominee or agent, and not with a view to the sale or distribution, within the meaning of the Securities
Act of 1933, as amended (the “Securities Act”) of any part thereof, and the undersigned has no present intention of
selling, granting participation in or otherwise distributing the same, other than to its affiliates, but subject, nevertheless,
to any requirement of law that the disposition of its property shall at all times be within its control. By executing this statement,
the undersigned further represents that it does not, other than in connection with transfers to its affiliates, have any contract,
undertaking, agreement or arrangement with any person to sell, transfer, or grant participations to such person or to any third
person, with respect to any Securities issuable upon exercise of the Warrant.

 

(b)              
The undersigned understands that the Securities issuable upon exercise of the Warrant at the time of issuance may not be
registered under the Securities Act and applicable state securities laws, on the ground that the issuance of such securities is
exempt pursuant to Section 4(2) of the Securities Act and state law exemptions relating to offers and sales not by means of a public
offering, and that the Company’s reliance on such exemptions is predicated on the undersigned’s representations set
forth herein.

 

(c)               
The undersigned agrees that in no event will it make a disposition of any Securities acquired upon the exercise of the Warrant
unless and until the undersigned provides, at the Company’s request, an opinion of counsel reasonably satisfactory to the
Company that such transfer does not require registration under the Securities Act and the securities laws applicable with respect
to any other applicable jurisdiction. Notwithstanding the foregoing, no opinion of counsel shall be necessary and such transfer
or assignment by the undersigned shall be permitted (a) if such transfer or assignment is to an affiliate of the undersigned or
(b) if the Company becomes the subject of foreign ownership, control or influence and such transfer or assignment is to a charitable
organization.

 

(d)              
The undersigned acknowledges that an investment in the Company is highly speculative and represents that it is able to fend
for itself in the transactions contemplated by this statement, has such knowledge and experience in financial and business matters
as to be capable of evaluating the merits and risks of its investments, and has the ability to bear the economic risks (including
the risk of a total loss) of its investment. The undersigned represents that it has had the opportunity to ask questions of the
Company concerning the Company’s business and assets and to obtain any additional information which it considered necessary
to verify the accuracy of or to amplify the Company’s disclosures, and has had all questions which have been asked by it
satisfactorily answered by the Company

 

(e)               
The undersigned acknowledges that the Securities issuable upon exercise or conversion of the Warrant must be held indefinitely
unless subsequently registered under the Securities Act or an exemption from such registration is available. The undersigned is
aware of the provisions of Rule 144 promulgated under the Securities Act which permit limited resale of shares purchased in a private
placement subject to the satisfaction of certain conditions, including, among other things, the existence of a public market for
the shares, the availability of certain current public information about the Company, the resale occurring not less than six months
after a party has purchased and paid for the security to be sold from the Company or any affiliate of the Company, the sale being
through a “broker’s transaction” or in transactions directly with a “market maker” (as provided by
Rule 144(f)) and the number of shares being sold during any three month period not exceeding specified limitations.

 

Dated:________________________

 

 

	 	
	 	(Typed or Printed Name)
	 	 
	 	
	 	(Signature)
	 	 
	 	
	 	(Title)

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