FORM 8-K

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

CURRENT REPORT

Pursuant to Section 13 or 15(d)
 of the Securities Exchange Act of 1934

Date of the Report (Date of earliest event reported): March19, 2018

WESTMOUNTAIN COMPANY
(Exact Name if Business Issuer as specified in its Charter)

Colorado
 
0-53030
 
26-1315305
(State or other Jurisdiction of Incorporation)
 
(Commission File Number)
 
(IRS Employer Identification Number)
         
   
3463 Magic Drive, Suite 120
   
   
San Antonio, TX 78229
   

(Address of principal executive offices, including zip code)

(210) 767-2727
(Registrant's telephone number including area code)

(Former Name or Former Address, if Changed Since the Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

[  ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

[  ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

[  ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

[  ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
 
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).
Emerging growth company 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. 
 

 


 

As used in this Current Report on Form 8-K, unless otherwise stated, all references to the "Company", "we," "our" and "us" refer to WestMountain Company and its consolidated subsidiaries, including after the Merger (as described below), CytoBioscience, Inc.
 

Item 1.01 Entry into a Material Definitive Agreement

The information contained in Items 2.01, 3.02, and 5.02 below relating to the various agreements described therein is incorporated herein by reference.
 

Item 2.01 Completion of Acquisition or Disposition of Assets

Merger Agreement

On March 19, 2018, WestMountain Company, a Colorado corporation ("WestMountain") entered into an Agreement of Merger and Plan of Reorganization, dated March 19, 2018 (the "Merger Agreement"), with WASM Acquisition Corp., a Colorado corporation and a subsidiary of the Company ("WASM"), and CytoBioscience, Inc., a Delaware corporation ("CytoBioscience"). Pursuant to the terms of the Merger Agreement, on March 19, 2018 (the "Closing Date"), WASM merged with and into CytoBioscience (the "Merger"), with CytoBioscience surviving the Merger and becoming a wholly-owned subsidiary of the Company, and the shareholders of CytoBioscience became shareholders of WestMountain.

On the Closing Date, all outstanding shares of capital stock of CytoBioscience were cancelled and exchanged for 42,522,598 newly issued shares of common stock of WestMountain ("Common Stock"). The shares issued to the CytoBioscience shareholders in the Merger constitute approximately 74.44% of the issued and outstanding shares of Common Stock of the Company as of and immediately after the consummation of the Merger.   In addition, warrants to purchase 2,040,000 shares of Common Stock of WestMountain ("Warrants") were issued in exchange for all outstanding warrants of CytoBioscience, which were cancelled, and WestMountain assumed 160,000 underwriter warrants consisting of Units to purchase additional shares of Common Stock and Warrants, as defined and described below at Item 3.02. The CytoBioscience warrants and the Units were issued in connection with the private offering described in Item 3.02 of this Form 8-K.

In addition, the directors of WestMountain will seek shareholder approval to change the name of the Company to CytoBioscience, Inc.  Additionally, the Merger Agreement provides for the resignation and election of certain directors of the Company, subject to compliance with Section 14(f) of the Securities Exchange Act of 1934, as amended (the "Exchange Act") and the rules of the Securities and Exchange Commission ("SEC") thereunder.  The transactions contemplated by the Merger Agreement, including the change in composition of the Board of Directors of the Company as described herein, will result in a change of control of WestMountain.

The foregoing description of the Merger Agreement does not purport to be complete and is qualified in its entirety by reference to the copy of the Merger Agreement filed as Exhibit 2.1 to this Form 8-K, and incorporated herein by this reference.

Until the Closing Date, Steven Anderson, Brian L. Klemsz, and Joni K. Troska were the officers of WestMountain, and Brian Klemsz was the sole director of WestMountain.  On the Closing Date, Brian L. Klemsz, submitted his resignation from WestMountain's Board of Directors (the "Board") and appointed Shing Leong Hui, Sue Lynn Hui, Paul Castella, Ian Clements, Alan Dean, James Garvin, and Thomas Knott to serve on the Board. The resignation of Brian L. Klemsz, and the appointment of Shing Leong Hui, Sue Lynn Hui, Paul Castella, Ian Clements, Alan Dean, and Thomas Knott will become effective on the 10th day following the filing of the Schedule 14F with the SEC (the "Effective Date"), while the appointment of James R. Garvin became effective at closing.
 
 
 
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On the Closing Date, Brian L. Klemsz, Joni K. Troska and Steven Anderson also submitted their resignations as the officers of the Company, and on the same date, the Board appointed Dr. James R. Garvin as the President and Chief Executive Officer of the Company, Dr. Thomas Knott as the Chief Science Officer of the Company, and Henry C. Bourg, CPA, MBA as the Chief Financial Officer of the Company, effective immediately.

The appointment of the new directors to the Board will be effective 10 days after the Company's filing of a Schedule 14F-1 with the SEC, which was filed on March 23, 2018.  See Item 5.02 of this Current Report on Form 8-K.

Lock-Up Agreement

All of the shares issued to CytoBioscience shareholders in the Merger are subject to a lock-up agreement ("Lock-Up Agreement") subject to a leak out schedule which concludes in two years, with limited exceptions for gifts, estate-related transactions and distributions to equity holders of certain entities. The foregoing description of the Lock-Up Agreement does not purport to be complete and is qualified in its entirety by reference to the copy of the Lock-Up Agreement filed as Exhibit 10.1 to this Form 8-K, and incorporated herein by this reference.

About CytoBioscience, Inc.

Overview

The address of our principal executive office is 3463 Magic Drive, Suite 120, San Antonio, Texas 78229. Our telephone number is (210) 612-2727. Our website is http://www.cytobioscience.com .
 
Our common stock is quoted on the OTCBB ("Over-the-Counter-Bulletin-Board") under the symbol "WASM".

CytoBioscience is an established, revenue-generating ion channel screening business providing medical instrumentation and research services to organizations in the pharmaceutical and drug research market. Today it costs in excess of $2 billion dollars and takes 10+ years to bring a new drug to market. This cost, coupled with increased regulatory pressure, has created both a challenge and an opportunity - how to reduce costs and how to do it accurately, efficiently, and effectively.

The Company's answer to this challenge is its flagship instrument, the CytoPatch Freedom. The CytoPatch Freedom provides accurate and efficient ion channel research data that helps drug developers reduce time and costs.  The CytoPatch Freedom was chosen by the Food and Drug Administration (FDA) to be its key test instrument in developing new regulations for determining efficacy and effectiveness in drug development.  This proposed regulation, CiPA (Comprehensive In-Vitro Proarrhythmia Assay) requires that all new drugs, regardless of their intended purpose, be tested in a series of assays to determine if they possess pro-arrhythmia potential or not.  The CytoPatch Freedom instrument is capable of performing an entire series of assays in one unit, without add-ons, without delay and without the need for additional personnel.

CytoBioscience develops and manufactures related consumables, including various cell lines, and, further leveraging its instrument, provides Contract Research services on an in vitro and in vivo basis for a growing list of clients worldwide.  Finally, the Company's product line includes the HSC instrument, which is used to rapidly determine protein solubility; a key component of protein-based drug development.  HSC is manufactured the Company's wholly-owned subsidiary, Soluble Bioscience.
 
Each of these revenue-generating segments; instruments, consumables and contract research, is a leader in its technology and in its capacity.  Having undergone years of testing, starting, restarting, and honing its development into the cutting edge it is today, the Company is experiencing accelerating revenue growth and is well-positioned to reach its potential.
 
 
 
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At the core of the Company's business is its instrumentation, the CytoPatch Freedom. The CytoPatch is the leading hands-free robotic patch clamping instrument, which uses the Company's proprietary software and microchips to test individual cells for specific ion channel responses. The Company's instrumentation is also used for peptide and protein analysis, water temperature units for specific laboratory use and laboratory compressors, vacuum pump units for running laboratory instruments and disposable shipping units for transporting cells at physiological temperature.

The Company's consumables are its microchips, designed for use exclusively in the CytoPatch, cell lines and pre-seeded MEA plates, both of which are used in drug development, analysis and safety testing, plus, buffers and solutions for specific laboratory applications.
 

1.       KEY STRENGTHS OF THE COMPANY

The Company's solutions provide value to clients by significantly improving data accuracy and collection used to make timely and informed decisions on pharmaceutical compounds and their potential uses.

These deliverables are centered on proprietary technologies in the Company's microchips, software and cell lines.

The Company's combined offerings are synergistic; CytoPatch use consumes microchips and cells, while CRO work promotes instrument sales.

The Company's market is experiencing strong growth, driven by both regulation and rising demand for outsourced safety pharmacological work.

The company is engaged with both private and public partners globally, including the FDA.  Exchange between academic, pharmaceutical and independent researchers promotes further growth.

The Company is established and has the scale to compete effectively with the largest service and instrumentation providers in the industry.  Increasingly complex demands of both regulators and clients drive recurring revenues.

Management is led by Dr. James Garvin and has a combined 140 years of experience in the biotechnology industry.  The scientific team, Dr Thomas Knott, Dr Susan Judge, Dr. Stefan Mann, Dr Juliane Heide, and Dr Christa Nutzhorn are internationally recognized in the field of ion channel and cardiac research.


2.       ION CHANNEL SCREENING AND ITS APPLICATIONS

Ion channel screening enables accurate and detailed examination of cellular activity in order to conduct drug research and assess drug efficacy and safety, in addition to providing detailed analysis of how different diseases respond to different treatments. It is used by drug developers, drug researchers and pharmaceutical companies, to better address important information required for the creation of new drugs and identifying new cures and treatments.
 
 

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3.       HISTORY AND BACKGROUND OF THE COMPANY

Timeline of significant events

2011
·
Cytocentrics Bioscience GmbH established in Rostock, Germany
     
2012
·
Completed the development of the CytoPatch1 instrument
 
·
Developed a chip cleaning process for the academic markets
 
·
Serviced the first Multi-Electrode-Arrays customer
     
2013
·
Developed unique Assay Designer software with Drag and Drop capability to cut assay procedure adjustment time from days to seconds
 
·
Developed full cardiac panel – Assay and published Application Note
 
·
Completed modular assembly system finished for outsourced module manufacturing
 
·
Completed CytoPatch2 application and makes available for customer demo
 
·
Filed Patent P7 as a method and device for optical patch clamp chip
 
·
Established manufacturing system for mechanical, electrical and pneumatic modules
     
2014
·
Developed DRG neurons-Assay and published subsequent Application Note
 
·
Filed Patent P8 filed as method and device for cancer research / tissue patch
 
·
Obtained first customer for cardiac-screening-panel on myocytes
 
·
Established / Validated CIPA big 3 panel under physiological temperatures
 
·
Established fully automated self-testing Routine on CytoPatch2 including measurement head analysis
 
·
Filed Patent P10 for model-based therapeutic planning with ps-iPSC-CMs (patient specific induced pluripotent stem cell cardiomyocytes)
 
·
Established routine recording in in-house lab of stem cell cardiomyocyte action potentials (CIPA initiative)
 
·
Developed iPSC derived Cardiac-Myocyte-Assay and published subsequent Application Note
     
2015
·
Acquired by CytoBioscience and Company re-organized and headquartered in the US
 
·
Acquired Zenas Technologies, a leading cardiac safety CRO
 
·
Filed Patent P11 for culturing cells on micro-substrates
 
·
Signed joint venture agreements with Cyprotex (UK) and DSTC (Japan)
 
·
Analytical division added to increase CRO offerings and drive additional revenue
 
·
Only company in the US to offer pre-seeded MEA plates with cardiomyocytes
 
·
Selected by FDA as instrumentation for CiPA research studies
     
2016
·
Acquired the assets of Soluble Therapeutics

Background of CytoBioscience

Cytocentrics Bioscience, GmbH, founded by Dr. Thomas Knott (currently the Company's Chief Science Officer) was spun-out of academia. It was set up to focus on automation in patch clamp techniques. Early efforts of Cytocentrics Bioscience to bring a commercial product to market were under-capitalized. However, as research and development continued to advance, Cytocentrics Bioscience created the CytoPatch, the Company's high-throughput, hands free patch clamp instrument.
 
 
 

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CytoBioscience was established in July 2014 in Delaware. On March 5, 2015, CytoBioscience acquired Cytocentrics BioScience GmbH.

Following a re-organization of the Company's structure and the integration of Cytocentrics Biosciences GmbH in 2015, the Company focused on developing products and services towards broader commercialization.  In addition, the Company implemented cutting costs measures. From August 2015, the Company began to actively market its products and services and gained commercial traction.

The Company is headquartered in San Antonio, Texas, where it develops and completes the majority of its manufacturing, houses its R&D facility and serves as the Company's largest contract research organization (CRO) facility. The CRO group has a separate GLP facility in Cologne, Germany, and a separate cell development facility in Birmingham, Alabama. The facility in Cologne provides services to the European market and supports research and CRO in our U.S. based facilities.

In addition, the Company has a strategic alliance that develops business with DSTC in Tokyo, Japan.


4.       BUSINESS OVERVIEW

CytoBioscience is an established revenue-generating US-based company, with a focus on high accuracy ion channel screening and research. The Company has three operating segments:

Instrumentation, based on the Company's proprietary CytoPatch instrument, an ion channel measurement device;

Consumables, particularly using the Company's patented technology in its microchip, which has been made exclusively for use in the CytoPatch, as well as cells and cell lines; and

Contract research services for third parties.

The Company employs a scientific team with a multidisciplinary background and regulatory expertise. The Directors and senior management team has significant experience in biotechnology manufacturing and sales. The Company has an experienced management team, market leading products and services, high-caliber clients and partners and a focused strategy for growth through product development and sales, new strategic partnerships and strategic acquisitions. The Directors believe that the Company is well positioned to draw market share from both manual patch clamp and automated patch clamp ("APC") testing competitors.

Core business areas

CytoPatch

The CytoPatch represents a unique blend technology and bioscience that creates new frontiers of discovery and understanding about human cells. Those discoveries, those understandings, are the pathways to a far more effective utilization of drugs, and drug therapy. The underlying technology behind this, known as "patch clamping" – which involves no patch and no clamping, is what opens these amazing vistas.
 

 

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The "Art" of the Screen

In a business where speed and cost are everything, ion channels don't fit neatly into the traditional process of drug discovery. Pharmaceutical companies cannot easily apply their million-compound libraries to ion channels, because these channels don't behave like proteins. Ion channels are membrane-spanning macromolecules that regulate the flow of charged molecules such as Na+, K+, Cl−, and Ca2+ across an otherwise impermeable barrier. They don't catalyze enzymatic reactions, and induce no secondary, amplified signal. Instead, upon activation—whether by changes in voltage, ligand binding, or mechanical force—these channels open, creating a pore in the membrane through which charged molecules can flow.

Manual Patch Clamping

In traditional patch clamping, a skilled operator must manually manipulate cells and a pipet to form a seal, perhaps recording from just 10 cells in a day.

The resulting currents are small and fast—on the order of picoamperes, and often occurring on a millisecond timescale. Yet they are substantial enough to kick-start a chain reaction that, depending on the context and location, results in effects as varied as pain, muscle contraction, or even fertilization.


The bottom line is that it's not enough to know whether a potential drug compound binds a particular ion channel; scientists need to actually measure its impact on that flow of ions across the cell membrane. Researchers can measure these electrophysiologic changes indirectly, by using voltage-or ion-sensitive fluorescent dyes or atomic absorption spectroscopy for instance. But to do it right—that is, to directly measure the current flow across individual ion channels—requires the technique that won Neher and Sakmann their Nobel Prize: patch clamping.
 
 
 
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Consumables

Microchips
Central to CytoBioscience's business is its patented electrophysiological technology used in the Company's microchip which drives the instrumentation, the CytoPatch, to provide a high throughput and highly accurate platform to analyze ion channel analysis. The microchip enables the Company to complete hands-free patch clamping to deliver data and information to its clients with 99% accuracy, one of the best accuracy rates in the market.
 

The microchip enables the CytoPatch to capture a single cell, hold it in place, insert a probe and receive readings from the ion channels in those cells in order to assess the safety, efficacy and efficiency of a drug through the detailed examination of the cellular activity. The readings produced are electrical signals caused by the movements of proteins within the ion channels. These small signals are identified by the probe, sent to an amplifier through the microchip, and then displayed as a readable signal on a computer for a researcher to observe.

The opening inside the microchip is smaller than the size of a human cell and allows for cells to be held in place and analyzed. The design, patented as the CytoPatch Opening, is the core of what makes the instrument unique. The Company's patented technology uses a multiple channel opening, as opposed to a single hole approach applied by a number of its competitors. This enables multiple options, more detailed data and greater information flow because within the CytoPatch Opening there is a better catch, a better seal and ultimately better and more accurate data flow.



The Company's technology enables the CytoPatch to differentiate itself from other instruments in the market, particularly automated high-throughput machines, by completing a number of significant outcomes, including:

·
Completing the entire CiPA panel at 37 degrees C, the temperature of the human body, which is the optimal environment for the testing cells;

·
Completing longer and more stable recordings, which provides more accurate data and saves time compared to machines with shorter recording periods;

·
Completing stem cell cardiomyocytes and fast ligand gates ion channels (NMDA) which the Company believe are not able to be tested on alternative systems; and

·
Completing mechanical stimulation of cells in order to record the effects on the cell when they are moved or sheeted
 
 
 
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The Company believes that the ability of the CytoPatch to accomplish these outcomes distinguishes the it from its competitors and is a significant reason the FDA chose to use the CytoBioscience instrument for its ion channel CiPA research. In addition, the Company also received the award for Best Human Cell Technology Research Developers 2016.

Other Consumables

The Cyto-PTU Shipping Container keeps internal temperature at 37 ± 0.1 C for up to 100 hours.  This enables the Company to ship live cells, pre-seeded MEA plates and tissue samples domestically or world-wide without cell loss.  Conventional shipping is dependent on freezing.  The container is completely disposable, with no return shipping costs.  This is a previously untapped market, and interest is growing rapidly.

Cell lines and cells and per-seeded MEA plates, all of which are used by researchers in drug safety, drug analysis and drug development projects, and finally, buffers and solutions for specific laboratory applications.

Contract research

There is a growing trend in the pharmaceutical industry to outsource safety screening and efficacy or drug discovery and drug development work. This is a result of a pronounced decrease in productivity caused by an increase in R&D spending which has not, in recent years, yielded a proportional increase in new drug approvals. Increased demands from regulators are also making the process costlier.

As a result, the last five years have seen a period of consolidation with the closure of a number of R&D sites of many of the large pharmaceutical companies.  At the same time, there has been a growth in pharmaceutical companies outsourcing to CROs. CytoBioscience, which has developed a highly automated and efficient instrument together with expertise in the ion channel screening market are benefitting from this trend.

Intellectual property

The Company's intellectual property estate is wholly-owned and managed by the Company. The intellectual property portfolio consists of five active patents and four pending patents in the US, EU and Japan.

The Company believes that the corporation's intellectual property portfolio is significant to its future growth and defensible market share.


5.       INDUSTRY OVERVIEW

When the Human Genome Project completed in 2003, the ability to recognize the molecular basis for a disease and identify, among other things, the specific genes and proteins involved became easier. In the same year, Drug Discovery World first reported the emergence of automated patch clamping as a higher throughput alternative to traditional electrophysiological investigations made using manual patch clamp 1 .  In the period since this was first reported, APC platforms have been identified as central to ion channel drug discovery. Ion channels are proteins that form pores in cell membranes. They are involved in the control of many fundamental physiological processes in various tissues, and alterations in their functions give rise to pathological conditions. Ion channels were discovered in the membrane of electrically excitable cells such as neurons, cardiomyocytes, and skeletal muscle fibers and, for decades, drugs modulating cell excitability have been targeted by the pharmaceutical industry. Ion channels also play many roles in non-excitable tissues.
 
 
                                             
 
1   Source: Comley. J, PATCHERS vs SCREENERS – divergent opinion on high throughput electro-physiology!, Drug Discovery World, 2003
 
 
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In 2010, approximately 13% of marketed commercial drugs acted on ion channels. In recent years APC systems have evolved considerably and new ion channel screening technologies continue to be developed to discover new drugs. Patch-clamp is the gold standard technique to record ion channel activity, however, the costs associated with this technique are high as a result of the need for top-quality equipment, such as an anti-vibrating table, micro-manipulator, a microscope with IR-CCD camera, highly trained personnel and low throughput.

Over the years, there have been attempts to build devices to increase throughput, notably with automated electrophysiology systems. Such systems have revolutionized ion channel drug discovery by enabling the screening of numerous compounds on many types of ion channels and cellular models. These systems have also been important for safety pharmacology testing of many types of ion channels. These methods, however, still require improvements with respect to throughput, quality of the electrophysiological recordings and the physiological cellular models used for drugs and safety testing.

The development of new technologies has increased the number of drugs that can be identified, synthesized, characterized, screened and tested for therapeutic efficacy and safety. However, the process of drug discovery is long and expensive. Pharmaceutical companies spend approximately $50 billion annually in R&D and the average cost to bring a new drug to the market is estimated to be $1.8 billion 2 .  Most compounds fail in clinical trials, requiring development of new strategies, and methodologies.

Since ion channels control conduction of electrical activity in the heart, it is crucial to discern if off-target activities of drug candidates include cardiac ion channels. Möller and Witchel (2011) reviewed the most recent methods to screen drug candidates in major cardiac ion channels. These methods include APC using heterologous expression systems and automated action potential recordings from stem-cell derived cardiomyocyte. The developments in the field of ion channel screening technologies described indicate that the future is pointed toward the screening of drugs in more physiological relevant cellular models and networks.

Market size

The Company's core business is focused on the ion channel screening and drug screening market, principally through the Company's patented technology used in the CytoPatch to provide a high throughput and highly accurate platform to analyze ion channel drug discovery. More broadly, the Company operates in the pharmaceutical and biotechnology market, through its consumables, instrumentation and CRO work. This is a large and growing industry. In 2015, life sciences research and development exceeded $200 billion with an estimated 4 percent growth rate. It is estimated that the CRO market growth rate is between 6 and 9 percent. The drug discovery technologies sector is valued at $88 billion with an estimated 15% CAGR 3 , which is comparable to estimates for preclinical research and development 4 , in vitro/in silico oxicology testing and growth in nanomedicine 5 . Electrophysiology outside of medical devices is estimated to grow at 10.3% 6 and 13% for analytical instruments.
 

2   Source: Paul et al., (2010)
3   Source: Omics: biomedical Perspectives and Applications, 2012, D. Barth, K. Blum, M. A. Madigan, Global Industry Analysts Inc.
4   Source: Outsourcing Pharma.com (3/714), HTStec Ltd:Top 10 Drug Discovery Technologies Market, (2010-2015), Research And Markets, 6/13: 2012 30.4bn to $45.2bn 2016, Furthermore, Biopta/Reprocell estimate a 7 trillion Yen R&D value, 25% in preclinical.
5   Nanotechnology in Medical Applications: The Global Market September 2015, IVD/ISD toxicology estimated at a 15% CAGR, 5B in 2012, 10B in 2017 (BCC Research, the journal of precision medicine)
6   http://www.marketsandmarkets.com/PressReleases/electrophysiologyE.satsipmates Electrophysiol ogy CAGR 10.3% 2014-2019 to $4.75B
 
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The market for ion channel screening is anticipated to grow to $10 billion by 2021, led by a number of key industry trends including specific regulatory developments, the cost of drug development, an increase in outsourcing, and a reduced field of competition. The Company believes that these products and services provide a significant opportunity to capitalize on these trends to build and maintain its position as a market leader in the ion channel screening market.

The intertwined markets of ion channel instrumentation, ion channel CRO work, and the consumables are estimated to be greater than $4 billion. Approximately two-thirds of CRO business is funded by the pharmaceutical industry, another 27% from biotechnology, and the rest by the medical device, foundation and government sectors. Approximately 46% of clinical trials are conducted in the United States, 30% in Europe and the remainder in Asia, Latin America, Africa and the Middle East. That being said, 70% of the safety pharmacology works is in the United States.

As the chart below indicates 7 , the CRO business, which is where ion channel research and testing is embedded, has risen and continues to rise, since 2010.


Key industry trends

The Company have identified the following key trends driving the industry:

Regulatory developments

The Company's business and market generally are altered and impacted by the introduction of new guidelines by regulatory authorities. In 2012, the FDA and the European Medicines Agency (EMA) both released revised guidelines on drug interactions, including good laboratory practices (GLP) requirements. The Company's core instrument, the CytoPatch, is GLP compliant and can support the full FDA and EMA requirements. The most pertinent and significant regulatory development that directly affects CytoBioscience is the pending CiPA initiative in the US, which is driving a significant amount of the drug safety and drug efficacy work.
 
                                             
7   Source: Pharma and William Blair Equity Research (April 25, 2014)
 
 
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Cost of drug development

Any process and/or instrumentation that helps to reduce the overall cost of drug development, safety screening, efficacy, is being sought out by pharmaceutical companies of all size.

Increase in outsourcing

There is a growing trend in the pharmaceutical industry to outsource safety screening and efficacy or drug discovery and drug development work. This is a result of a pronounced decrease in productivity caused by an increase in R&D spending which has not, in recent years, yielded a proportional increase in new drug approvals. Increased demands from regulators are also making the process costlier. As a result, in the last five years there has been a period of consolidation with the closure of a number of R&D sites of many of the large pharmaceutical companies. Instead, there has been a growth in pharmaceutical companies outsourcing to CROs. CytoBioscience, which has developed a highly automated and efficient instrument together with expertise in the ion channel screening market are benefitting from this trend.

Reduced field of competition

The ion channel screening market is relatively nascent and growing quickly, however there has been a consolidation in recent years. Specifically, the level of competition has been reduced, particularly CRO, by consolidation amongst competitors in the industry, which has reduced the number of companies performing CRO work.

The Company is actively taking advantage of the industry trends driving the increased demand for ion channel screening, including the FDA, who have recognised that the Company's technology and product produces the best results for assessing drug efficacy and safety, and exclusively use the CytoPatch for their drug screening process.

6.       PRINCIPAL CUSTOMERS

The Company has a wide range of international customers, principally in the pharmaceutical, biotechnology and medical research industries along with CRO organisations and regulatory authorities. In addition, the Company's customers also include DSTC and its network of pharmaceutical research companies in Japan, the Victor Chang Institute in Australia and the FDA.

7.       COMPETITION

The Company's core markets, ion channel screening and drug efficacy, broadly fall into the life science tools and services sector, which also includes molecular diagnostics, genetic analysis and sequencing, CROs and analytic equipment. Within this broad sector there has been a high level of consolidation and less than 20 companies control 80% of the market.

In 2014, the APC space was dominated by a small number of companies, including Molecular Devices (UK) Ltd, Sophion, Nanion Technologies and Fluxion Biosciences. The Company believes that no competitor has a unique instrument that provides the accuracy and quality of results that the CytoPatch offers.

In particular, inexact nomenclature makes for indirect comparison with the instrumentation the Company builds as its focus lies outside of mainstream, high throughput APC.

The Company is well-positioned to take advantage of this expansion and distance itself from others competing within the ion channel screening and drug efficacy market.
 
 
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8.       EMPLOYEES

We currently employ 24 people.

Item 3.02 Unregistered Sales of Equity Securities.
 
Private Offering

Prior to the Merger, CytoBioscience completed a private placement ("Private Offering") in which it issued units ("Units") consisting of shares and warrants exercisable for  shares of CytoBioscience common stock to three accredited investors (the "Purchasers"), one of whom is the Placement Agent (as defined below), for total consideration of $1.53 million.  The other two Purchasers were BOCO Investment, LLC, and Shing Leong Hui. The Private Offering was completed by CytoBioscience on March 1, 2018. Such securities were issued in reliance upon an exemption from the registration requirements of the Securities Act pursuant to Section 4(a)(2) thereof and Rule 506 of Regulation D promulgated thereunder. Approximately $48,570 of the proceeds of the Private Offering were used to repay amounts payable to Dr. James Garvin, the Chief Executive Officer, representing advances he made to CytoBioscience for working capital purposes. Approximately $200,000 of the proceeds of the Private Offering were used to repay amounts lent in a line of credit by Ian Clements, a Director of the Company.  The remaining proceeds were used to repay indebtedness, to pay transaction costs and fees, and for working capital purposes.  CytoBioscience was represented in the Private Offering by Divine Capital Markets LLC, a registered broker-dealer, which acted in a best efforts capacity as sole placement agent (the "Placement Agent"). At the closing of the Private Offering, the Placement Agent earned a cash commission of $90,000 and underwriter warrants consisting of Units to purchase shares and warrants to purchase shares of CytoBioscience common stock at 125% of the Private Offering price. The Placement Agent also elected to invest $30,000 of its cash commission in the Units.

Securities Purchase Agreement

The terms of the Private Offering are set forth in a Securities Purchase Agreement. Under the Securities Purchase Agreement, the Purchasers purchased Units consisting of one share of common stock and a warrant to purchase one shares of common stock, for $0.75 per unit.  The Securities Purchase Agreement requires the Company to file a registration statement on Form S-1 with the SEC (the "Registration Statement") to register the resale by the Purchasers of all shares of Common Stock and shares underlying the Warrants within 90 days of the Closing and to cause such Registration Statement to become effective within 180 days of the Closing. The foregoing description of the Securities Purchase Agreement does not purport to be complete and is qualified in its entirety by reference to the copy of the Securities Purchase Agreement filed as Exhibit 10.2 to this Form 8-K, and incorporated herein by this reference.

All of the shares and warrants issued by CytoBioscience in the Private Offering were cancelled and exchanged for shares and warrants, respectively, of WestMountain in connection with the Merger.

WestMountain Shares and Warrants Issued in the Merger

The information regarding the Merger Agreement and the issuance of the shares of Common Stock of the Company and the Warrants to purchase Common Stock contemplated thereunder set forth in Item 2.01 of this Current Report on Form 8-K is incorporated by reference into this Item 3.02.
 
 
- 13 -

 

 
Upon the closing of the Merger on March 19, 2018, the Company issued (i) a total of 42,522,598 shares of common stock ("Merger Shares") to CytoBioscience's stockholders ("Shareholders") in exchange for all of the outstanding shares of common and preferred stock of CytoBioscience, and (ii) Warrants for a total of 2,040,000 shares of Common Stock in exchange for the warrants for common stock of CytoBioscience. WestMountain assumed 160,000 underwriter warrants consisting of Units to purchase additional shares of Common Stock and Warrants. Such Merger Shares, Warrants, and Units were issued in reliance upon an exemption from the registration requirements of the Securities Act of 1933, as amended ("Securities Act"), pursuant to Section 4(a)(2) thereof, which exempts transactions by an issuer not involving any public offering. The issuance of such securities was not a public offering for purposes of Section 4(a)(2) because of its being made only to approximately 25 current Shareholders of CytoBioscience, such Shareholders' status as accredited investors and the manner of the issuance, including that the Company did not engage in general solicitation or advertising with regard to the issuance of the securities and did not, and will not, offer the shares to the public in connection with the issuance.

Item 4.01.  Changes in Registrant's Certifying Accountant.

Effective on March 20, 2018, and with the approval of our Board of Directors, we dismissed EKS&H LLLP, or EKS&H, as our independent registered public accounting firm engaged to audit our financial statements.

During the years ended December 31, 2017 and 2016, and the subsequent interim period through March 22, 2018, there were no (1) disagreements (as defined in Item 304(a)(1)(iv) of Regulation S-K and related instructions) with EKS&H on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of EKS&H, would have caused EKS&H to make reference to the subject matter of the disagreement in their reports, or (2) reportable events (as defined in Item 304(a)(1)(v) of Regulation S-K).

The audit reports of EKS&H on the Company's consolidated financial statements as of and for the years ended December 31, 2017 and 2016, did not contain any adverse opinion or disclaimer of opinion, nor were they qualified or modified as to uncertainty, audit scope or accounting principles.  

The Company has provided EKS&H with a copy of the disclosures it is making in this Item 4.01 prior to the filing of this Current Report on Form 8-K with the SEC, and has requested EKS&H to furnish the Company with a letter addressed to the SEC stating whether or not it agrees with the statements made herein, and if not, stating the reasons for their disagreement.  A copy of EKS&H's letter dated March 23, 2018 is attached as Exhibit 16.1 to this Current Report on Form 8-K. 
Item 5.01 Change in Control of Registrant.
The information contained in Item 2.01 of this Current Report on Form 8-K is incorporated by reference into this Item 5.01.
Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

Director Resignations and Appointments

On the Closing Date, in accordance with the Merger Agreement, Brian L. Klemsz, submitted his resignations from the Board and appointed Shing Leong Hui, Sue Lynn Hui, Paul Castella, Ian Clements, Alan Dean, James Garvin, and Thomas Knott to serve on the Board. The resignation of Brian L. Klemsz and the appointment of Shing Leong Hui, Sue Lynn Hui, Paul Castella, Ian Clements, Alan Dean, and Thomas Knott will become effective on the 10th day following the filing of the Schedule 14F with the SEC, while the appointment of James R. Garvin became effective at closing. The resignations were not the result of any disagreements with the Company .

The Board expects to appoint Mr. Dean and Mr. Castella to the Audit Committee, and Mr. Clements and Mr. Hui to the Compensation Committee.
 
 
 
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Officer Resignations and Appointments

On the Closing Date, Brian L. Klemsz, Joni Troska and Steven Anderson also submitted their resignations as the officers of the Company, and on the same date, the Board appointed Dr. James R. Garvin as the President and Chief Executive Officer of the Company, Dr. Thomas Knott as the Chief Science Officer of the Company, and Henry C. Bourg, CPA, MBA as the Chief Financial Officer of the Company, effective at the closing of the Merger.

James R. Garvin has served as the CEO, President and a Director of CytoBioscience since March 2015. Dr. Garvin has twenty-nine years of experience in working in the biotech sector and finance. His work has been recognized by the French Academy of Science and he was named one of sixteen healthcare innovators in the state of Texas for 2017. As a former investment banker, he has worked on a number of different biotechnology acquisitions, in the United States, Europe and in Israel. He has been a board member of a number of companies and currently is on the board of the Zerah Foundation which provides educational opportunities for underprivileged children in India. His international range of experiences and interests has been diverse but this has allowed him to have an outside of the box perspective that has served him well in working with companies and situations over the years. Dr. Garvin received his PhD in Economic Systems from the University of New Orleans, as well as his Masters in Administration and his BA (Hons) in English and International Relations from the State University of New York, Albany.

Thomas Knott, PhD has served as the Chief Science Officer of CytoBioscience since March 2015. Dr. Thomas Knott is an innovative technology driven entrepreneur who founded Cytocentrics CCS GmbH, a high-tech scientific instrumentation and biotech company specializing in the field of ion channel electrophysiology in 2001.  Dr. Knott single-handedly developed the Cytocentrics instrument for ion channel analysis, the CytoPatch™, demonstrating a more complete feature set in patch clamp capabilities than any existing manual patch clamp system (whole cell voltage clamp and current clamp, perforated patch clamp, extracellular and intracellular perfusion, temperature control, fast ligand gated ion channels, mechano-stimulation, GLP, and network capability). He has worked with three Nobel Prize winning teams.

Henry C. Bourg, CPA, has served as the CFO of CytoBioscience since September 2017. Henry is an accomplished senior finance and accounting professional with over thirty years' experience with start-ups, mid-sized and multi-billion dollar global organizations. He started his career with Ernst & Young in Texas and later in Maryland and New York. While with Ernst & Young, he served primarily financial institution clients such as American General Life Insurance, Capital One and MBNA America Bank. In addition to his public accounting experience, Henry has served in senior finance and accounting roles with the US Government in Europe; The Shaw Group, Inc., Chicago Bridge & Iron, and Westinghouse Electric Company in Asia; Inktomi Corporation and Bookham, Inc. (now Oclaro) as well as several technology start-ups in Silicon Valley.  He earned his Bachelor of Science degree in Accounting from Louisiana State University and a Master of Business Administration from Santa Clara University .

Employment Agreements

The Company expects to enter into new employment agreements with Dr. Garvin and Mr. Bourg. The terms of the agreements have not been, but will be, determined by the Board.

Related Party Transactions

In April of 2016, Buschier, S.p.A agreed, on behalf of itself and its related or affiliated entities, to forbear from collecting or otherwise enforcing CytoBioscience's then outstanding obligations to those entities.  The initial outstanding obligations consisted of approximately $9,551,922.22 due under the agreements with those entities. In April 2016, Buschier agreed to forgive $4,750,000 of that debt in exchange for CytoBioscience paying $750,000 cash against the debt and entering into a new note for $4,051,977.22 with the new note being due December of 2016.

In October of 2016, Buschier agreed to accept a $1,000,000 payment and amend the note to $3,172,537.42 with a new due date of June 2017. In June of 2017, the note was amended to have a new due date of August 2017. In August of 2017, the note was amended to reflect a due date of October 2017.  In November of 2017, an agreement was reached between Buschier and CytoBioscience to convert the remaining debt to equity, with a 1.5% rate applied to the debt to determine the total number of shares to exchange, and 5,058,415 shares were then issued to Buschier.
 
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In February of 2017, Targeted Technology Fund II, L.P. ("TTF II"), whose partners include Paul Castella, Ian Clements and Alan Dean who are on the board of directors of the Company, loaned the company $300,000 at a 12% annual interest.

In May of 2017, Targeted General Partner, L.P. ("TGP"), whose partners include Paul Castella, Ian Clements and Alan Dean who are on the board of directors of the Company, loaned the company $400,000 at a 12% annual interest rate.

In June of 2017, TGP loaned the company $300,000 at a 12% annual interest rate.

In February 2018, the three notes (the February 2017 TTF II note, May 2017 TTGP note and June 2017 TGP note) were combined into an interest only $1,362,572.44 Promissory Note which matures in February 2021. On the Closing Date $575,541.00 of the Note was converted into 766,667 shares of CytoBioscience.

In March of 2017, Ian Clements, a Director of the Company, loaned the company $300,000 at 12% annual interest and with a 30% warrant option. That note is still outstanding but has been amended to a 5% Note maturing in February 2021.

In July of 2017, Alan Dean, a director of the Company, loaned the Company $50,000 at 12% annual interest. That note was converted to shares at closing whereby 73,189 were issued (and included in the total shares of beneficial ownership detailed above).

In December of 2017, Ian Clements, a director of the Company, established a line of credit of $200,000 from his personal funds at 12% annual interest.  $200,000 of that line had been used and repaid in full.


Item 8.01   Other Events.

On March 23, 2018, the Company issued a press release announcing that it had completed the Merger. A copy of the press release is attached to this Current Report on Form 8-K as Exhibit 99.1 and is incorporated herein by reference.
 

Item 9.01  Financial Statements and Exhibits

(a)   Financial statements of business acquired. We will file the audited financial statements of CytoBioscience, Inc. required under applicable rules of the SEC within 71 days after the date this Form 8-K reporting the acquisition of CytoBioscience, Inc. is required to be filed.

(b)   Pro forma financial information. We will file the pro forma financial information required under applicable rules of the SEC within 71 days after the date this Form 8-K reporting the acquisition of CytoBioscience, Inc. is required to be filed.
 
 
 
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(d)    Exhibits.

The exhibits listed in the following Exhibit Index are filed as part of this Current Report on Form 8-K:

Exhibit
Number
Description
   
    2.1*
Agreement of Merger and Plan of Reorganization dated as of March 19, 2018 by and among the Registrant, WASM Acquisition Corp. and CytoBioscience, Inc.
10.1
Lock-up Agreement between the Registrant and the officers, directors and shareholders party thereto
10.2
Securities Purchase Agreement between the Registrant and the investor parties thereto
10.3
Investment Banking Agreement dated December 15, 2017 between Registrant and Divine Capital
 
Markets LLC
16.1
Letter from EKS&H LLLP to the Securities and Exchange Commission dated March 23, 2018
99.1
Press Release dated March 23, 2018

* Schedules and similar attachments to the Purchase and Sale Agreement have been omitted pursuant to Item 6.01(b)(2) of Regulation S-K. The registrant will furnish a supplemental copy of any omitted schedule or similar attachment to the Securities and Exchange Commission upon request.
 
 

 

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 March 23, 2018
WESTMOUNTAIN COMPANY
 
 
 
 
By
/s/  James R. Garvin,
 
 
James R. Garvin, Chief Executive Officer, and Director (Principal Executive Officer)
 
 

 
 
 
 
 
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Exhibit 2.1
 
 
 


AGREEMENT OF MERGER AND
PLAN OF REORGANIZATION
among
WESTMOUNTAIN COMPANY
WASM ACQUISITION CORP. and
CYTOBIOSCIENCE, INC.
March 19, 2018




Exhibit 2.1 Merger Agreement -- Page 1

AGREEMENT OF MERGER AND PLAN OF REORGANIZATION
THIS AGREEMENT OF MERGER AND PLAN OF REORGANIZATION is made and entered into on March 19, 2018, by and among WESTMOUNTAIN COMPANY, a Colorado corporation (" Parent "), WASM ACQUISITION CORP., a Colorado corporation (" Acquisition Corp. "), which is a wholly-owned subsidiary of Parent, and CYTOBIOSCIENCE, INC., a company incorporated in the State of Delaware (the " Company ").
W I T N E S S E T H :
WHEREAS, the Board of Directors of each of Acquisition Corp., Parent and the Company have each determined that it is fair to and in the best interests of their respective corporations and shareholders for Acquisition Corp. to be merged with and into the Company (the " Merger ") upon the terms and subject to the conditions set forth herein;
WHEREAS, the Board of Directors of Acquisition Corp. has approved the Merger in accordance with the Colorado Business Corporation Act (the " BCA ") and the Board of Directors of the Company has approved the Merger in accordance the Delaware General Corporation Law (" DGCL "), and upon the terms and subject to the conditions set forth herein and in the Statement of Merger (the " Statement of Merger ") attached as Exhibit A hereto; and the Board of Directors of Parent has also approved this Agreement and the Statement of Merger;
WHEREAS, the Board of Directors of the Company have recommended to the Stockholders that they should approve, by written consent pursuant to the DGCL, this Agreement and the Statement of Merger and the transactions contemplated hereby and thereby, including without limitation, the Merger, and Parent, as the sole stockholder of Acquisition Corp., has approved this Agreement, the Statement of Merger and the transactions contemplated and described hereby and thereby, including without limitation, the Merger; and
NOW, THEREFORE, in consideration of the mutual agreements and covenants hereinafter set forth, the p arties hereto agree as follows:
1.             The Merger .
1.1             Merger Subject to the terms and conditions of this Agreement and the Statement of Merger, Acquisition Corp. shall be merged with and into the Company in accordance with the BCA and the DGCL.  At the Effective Time (as hereinafter defined), the separate legal existence of Acquisition Corp. shall cease, and the Company shall be the surviving corporation in the Merger (sometimes hereinafter referred to as the " Surviving Corporation ") and shall continue its corporate existence under the laws of the State of Delaware under the name of CytoAnalytics, Inc., or some derivation thereof. The Parent and the Company shall cooperate and use good faith, commercially reasonable efforts to cause the Merger to be treated as a tax-free reorganization pursuant to Section 368 of the Code.
 
Exhibit 2.1 Merger Agreement -- Page 2

1.2             Effective Time The Merger shall become effective on the date and at the time the Articles of Merger are filed with the Secretary of State of the State of Colorado in accordance with the BCA and the Secretary of State of the State of Delaware in accordance with the DGCL, if applicable.  The time at which the Merger shall become effective as aforesaid is referred to hereinafter as the " Effective Time ."
1.3             Articles of Incorporation, By-laws, Directors and Officers .
(a)             The Certificate of Incorporation of the Company, as in effect immediately prior to the Effective Time, attached as Exhibit B hereto, shall be the Certificate of Incorporation of the Surviving Corporation from and after the Effective Time until further amended in accordance with applicable law.
(b)             The By-laws of the Company, as in effect immediately prior to the Effective Time, attached as Exhibit C hereto, shall be the By-laws of the Surviving Corporation from and after the Effective Time until amended in accordance with applicable law, the Articles of Incorporation of the Surviving Corporation and such By-laws.
(c)             The directors and officers listed in Exhibit D hereto shall be the directors and officers of the Surviving Corporation, and each shall hold his respective office or offices from and after the Effective Time (except, in the case of directors, as described in Section 6.4) until his successor shall have been elected and shall have qualified in accordance with applicable law, or as otherwise provided in the Articles of Incorporation or By-laws of the Surviving Corporation.
1.4             Assets and Liabilities At the Effective Time, the Surviving Corporation shall possess all the rights, privileges, powers and franchises of a public as well as of a private nature, and be subject to all the restrictions, disabilities and duties of each of Acquisition Corp. and the Company (collectively, the " Constituent Corporations "); and all the rights, privileges, powers and franchises of each of the Constituent Corporations, and all property, real, personal and mixed, and all debts due to any of the constituent corporations on whatever account, as well for stock subscriptions as all other things in action or belonging to each of the Constituent Corporations, shall be vested in the Surviving Corporation; and all property, rights, privileges, powers and franchises, and all and every other interest shall be thereafter as effectively the property of the Surviving Corporation as they were of the several and respective constituent corporations, and the title to any real estate vested by deed or otherwise in either of the such Constituent Corporations shall not revert or be in any way impaired by the Merger; but all rights of creditors and all liens upon any property of any of the Constituent Corporations shall be preserved unimpaired, and all debts, liabilities and duties of the Constituent Corporations shall thenceforth attach to the Surviving Corporation, and may be enforced against it to the same extent as if said debts, liabilities and duties had been incurred or contracted by it.
 
Exhibit 2.1 Merger Agreement -- Page 3

1.5            Manner and Basis of Converting Shares .
(a)            At the Effective Time:
(i)            each share of common stock, par value $0.001 per share, of Acquisition Corp. that shall be outstanding immediately prior to the Effective Time shall, by virtue of the Merger and without any action on the part of the holder thereof, be converted into the right to receive such proportionate number of common shares, par value $0.001 per share, of the Surviving Corporation, so that at the Effective Time, Parent shall be the holder of all of the issued and outstanding shares of the Surviving Corporation;
(ii)            the shares of common stock, par value $0.0001 per share, of the Company (the " Company Common Stock "), which shares at the Closing will constitute all of the issued and outstanding shares of Common Stock of the Company, beneficially owned by the Stockholders listed in Schedule 2.4 (other than shares of Company Common Stock as to which appraisal rights are perfected pursuant to the applicable provisions of the DGCL and not withdrawn or otherwise forfeited), shall, by virtue of the Merger and without any action on the part of the holders thereof, be converted into the right to receive the number of shares of Parent Common Stock specified in Schedule 1.5 for each of the Stockholders (subject to adjustment by the Company prior to closing as to the allocation of consideration among Company Stockholders without changing the total consideration).  Each of the pre-merger officers, directors and shareholders of the Company, and each of the pre-merger officers, directors and 10% or greater shareholders of Parent shall enter into customary lock-up agreements, attached as Exhibit E hereto;
(iii)            the shares of Series A Preferred Stock, par value $0.0001 per share, of the Company (the "Company Preferred Stock"), which shares together with the Company Common Stock at the Closing will constitute all of the issued and outstanding shares of capital stock of the Company, beneficially owned by the Stockholders listed in Schedule 2.4 (other than shares of Company Preferred Stock as to which appraisal rights are perfected pursuant to the applicable provisions of the DGCL and not withdrawn or otherwise forfeited), shall, by virtue of the Merger and without any action on the part of the holders thereof, be converted into the right to receive the number of shares of Parent Common Stock specified in Schedule 1.5 for each of the Stockholders (subject to adjustment by the Company prior to closing as to the allocation of consideration among Company Stockholders without changing the total consideration).  Each of the holders of the Company Preferred Stock shall enter into customary lock-up agreements, attached as Exhibit E hereto;
(iv)            each share of Company Common Stock held in the treasury of the Company immediately prior to the Effective Time shall be cancelled in the Merger and cease to exist; and
(v)            warrants to purchase up to 2,000,000 shares of Company Common Stock issued in the Offering that shall be outstanding immediately prior to the Effective Time, shall, by virtue of the Merger and without any action on the part of the holder thereof, be converted into the right to receive warrants to purchase up to 2,000,000 shares of Parent Common Stock attached as Exhibit F hereto, exercisable contingent upon the authorization of additional shares of Parent Common Stock (the "Parent Warrants").
(b)            After the Effective Time, there shall be no further registration of transfers on the stock transfer books of the Surviving Corporation of the shares of Company Common Stock that were outstanding immediately prior to the Effective Time.
 
Exhibit 2.1 Merger Agreement -- Page 4

 
1.6            Surrender and Exchange of Certificates Promptly after the Effective Time and upon (i) surrender of a certificate or certificates representing shares of Company Common Stock that were outstanding immediately prior to the Effective Time or an affidavit and indemnification in form reasonably acceptable to counsel for the Parent stating that such Stockholder has lost its certificate or certificates or that such have been destroyed, Parent shall issue to each record holder of the Company Common Stock surrendering such certificate or certificates, a certificate or certificates registered in the name of such Stockholder representing the number of shares of Parent Common Stock that such Stockholder shall be entitled to receive as set forth in Section 1.5(a)(ii) hereof.  Until the certificate, certificates or affidavit is or are surrendered as contemplated by this Section 1.6 and Section 4 hereof, each certificate or affidavit that immediately prior to the Effective Time represented any outstanding shares of Company Common Stock shall be deemed at and after the Effective Time to represent only the right to receive upon surrender as aforesaid the Parent Common Stock specified in Schedule 1.5 hereof for the holder thereof or to perfect any rights of appraisal which such holder may have pursuant to the applicable provisions of the DGCL.
1.7            Warrants . All outstanding options and warrants for Company Common Stock will be converted to Company Common Stock or cancelled prior to the closing, except for warrants for up to 2,000,000 shares which may be granted in the Offering, which will be converted on a one-for-one basis into the Parent Warrants.
1.8             Parent Common Stock  Parent agrees that it will cause the Parent Common Stock into which the Company Common Stock is converted at the Effective Time pursuant to Section 1.5(a)(ii) to be available for such purpose.  Parent further covenants that immediately prior to the Effective Time there will be no more than 9,517,402 shares of Parent Common Stock issued and outstanding and no other common or preferred stock or equity securities or any options, warrants, rights or other agreements or instruments convertible, exchangeable or exercisable into common or preferred stock or other equity securities shall be issued or outstanding.
1.9            Sale of Assets; Dividend.   Prior to, or concurrent with the Effective Time, Parent shall sell various assets, including, but not limited to, its Nexcore Healthcare Capital Corp. asset, and shall effect a cash dividend to the pre-merger Parent shareholders, consisting of the proceeds from the sale of the assets. In selling the assets, Parent shall not incur any liabilities which shall survive post-closing.
1.10           L ock-up Agreements.   Parent shall cause all of its officers, directors and holders of more than 5% of the outstanding Parent Common stock to enter into customary lock-up agreements, attached as Exhibit E hereto.
2.            Representations and Warranties of the Company The Company hereby represents and warrants to Parent and Acquisition Corp. as follows:
2.1            Organization, Standing, Subsidiaries, Etc .
 
Exhibit 2.1 Merger Agreement -- Page 5


 
(a)            The Company is a corporation duly organized and existing in good standing under the laws of the State of Delaware, and has all requisite power and authority (corporate and other) to carry on its business, to own or lease its properties and assets, to enter into this Agreement and the Statement of Merger and to carry out the terms hereof and thereof.  Copies of the Articles of Incorporation and By-laws of the Company that have been delivered to Parent and Acquisition Corp. prior to the execution of this Agreement are true and complete and have not since been amended or repealed.
(b)            Except as described in Schedule 2.1 , the Company has no subsidiaries or direct or indirect interest (by way of stock ownership or otherwise) in any firm, corporation, limited liability company, partnership, association or business.  The Company owns all of the issued and outstanding capital stock or membership interests of the Subsidiaries free and clear of all Liens, and the Subsidiaries have no outstanding options, warrants or rights to purchase capital stock or other equity securities of such Subsidiaries, other than the capital stock or membership interests owned by the Company.  Unless the context otherwise requires, all references in this Section 2 to the "Company" shall be treated as being a reference to the Company and the Subsidiaries taken together as one enterprise.
2.2            Qualification The Company is duly qualified to conduct business as a  corporation and is in good standing with the State of Delaware and in each other jurisdiction wherein the nature of its activities or its properties owned or leased makes such qualification necessary, except where the failure to be so qualified would not have a material adverse effect on the condition (financial or otherwise), properties, assets, liabilities, business operations, results of operations or prospects of the Company taken as a whole (the " Condition of the Company ").
2.3            Capitalization of the Company The authorized capital stock of the Company consists of 100,000,000 shares of Company Common Stock and 25,000,000 shares of Company Series A Preferred Stock. The Company has no authority to issue any other capital stock.  There are 9,508,540 shares of Company Common Stock and  24,352,242 shares of Company Series A Preferred Stock issued and outstanding, and such shares are duly authorized, validly issued, fully paid and nonassessable.  Except as disclosed in Schedules 2.10 , the Company has no outstanding warrants, stock options, rights or commitments to issue Company Common Stock or other Equity Securities of the Company, and there are no outstanding securities convertible or exercisable into or exchangeable for Company Common Stock or other Equity Securities of the Company. All of the issued and outstanding Company Equity Securities were issued in compliance with applicable federal and state securities laws.
2.4            Company Stockholders Schedule 2.4 hereto contains a true and complete list of the names and addresses of the record owner of all of the outstanding shares of Company Common Stock and other Equity Securities of the Company, together with the number and percentage (on a fully-diluted basis) of securities held.  To the knowledge of the Company, except as described in Schedule 2.4 , there is no voting trust, agreement or arrangement among any of the beneficial holders of Company Common Stock affecting the exercise of the voting rights of Company Common Stock. The Company Stockholders have full right, power, and authority to transfer, assign, convey, and deliver their respective Company Shares; and delivery of such Company Shares at the Effective Time will convey good and marketable title to such Company Shares free and clear of any claims, charges, equities, liens, security interests, and encumbrances.
 
Exhibit 2.1 Merger Agreement -- Page 6

 
2.5             Corporate Acts and Proceedings The execution, delivery and performance of this Agreement and the Statement of Merger (together, the " Merger Documents ") have been duly authorized by the Board of Directors of the Company and have been approved by the requisite vote of the Stockholders, and all of the corporate acts and other proceedings required for the due and valid authorization, execution, delivery and performance of the Merger Documents and the consummation of the Merger have been validly and appropriately taken, except for the filing of the Statement of Merger referred to in Section 1.2.
2.6            Compliance with Laws and Instruments To the knowledge of the Company, the business, products and operations of the Company have been and are being conducted in compliance in all material respects with all applicable laws, rules and regulations, except for such violations thereof for which the penalties, in the aggregate, would not have a material adverse effect on the Condition of the Company.  The execution, delivery and performance by the Company of the Merger Documents and the consummation by the Company of the transactions contemplated by this Agreement: (a) will not require any authorization, consent or approval of, or filing or registration with, any court or governmental agency or instrumentality, except such as shall have been obtained prior to the Closing, (b) will not cause the Company to violate or contravene in any material respect (i) any provision of law, (ii) any rule or regulation of any agency or government, (iii) any order, judgment or decree of any court, or (iv) any provision of the Articles of Incorporation or By-laws of the Company, (c) will not violate or be in conflict with, result in a breach of or constitute (with or without notice or lapse of time, or both) a default under, any indenture, loan or credit agreement, deed of trust, mortgage, security agreement or other contract, agreement or instrument to which the Company is a party or by which the Company or any of its properties is bound or affected, except as would not have a material adverse effect on the Condition of the Company, and (d) will not result in the creation or imposition of any material Lien upon any property or asset of the Company.
2.7      Binding Obligations The Merger Documents constitute the legal, valid and binding obligations of the Company and are enforceable against the Company in accordance with their respective terms, except as such enforcement is limited by bankruptcy, insolvency and other similar laws affecting the enforcement of creditors' rights generally and by general principles of equity.
2.8      Broker's and Finder's Fees With the exception of 1,500,000 shares of the Parent's common stock, $90,000 in cash and 160,000 warrants to purchase common stock, issued as broker or finder compensation, no Person has, or as a result of the transactions contemplated herein will have, any right or valid claim against the Company, Parent, Acquisition Corp. or any Stockholder for any commission, fee or other compensation as a finder or broker, or in any similar capacity.
 
Exhibit 2.1 Merger Agreement -- Page 7

 
2.9     Financial Statements Attached hereto as Schedule 2.9 are the Company's audited Consolidated Balance Sheet, Consolidated Statement of Operations, Consolidated Statement of Changes in Shareholders' Equity and Consolidated Statement of Cash Flows as of and for the years ended December 31, 2016 and 2015, and the Company's unaudited Consolidated Balance Sheet (the " Balance Sheet ") as of September 30, 2017 (the " Balance Sheet Date ") and related Statement of Operations, Consolidated Statement of Changes in Shareholders' Equity and Consolidated Statement of Cash Flows as of and for the period ended September 30, 2017.  Such financial statements (i) are in accordance with the books and records of the Company, (ii) present fairly in all material respects the financial condition of the Company at the dates therein specified and the results of its operations and changes in financial position for the periods therein specified and (iii) have been prepared in accordance with generally accepted accounting principles (" GAAP ") applied on a basis consistent with prior accounting periods.
2.10             Absence of Undisclosed Liabilities The Company has no material obligation or liability (whether accrued, absolute, contingent, liquidated or otherwise, whether due or to become due), arising out of any transaction entered into at or prior to the Closing, except (a) as disclosed in Schedule 2.10 and/or Schedule 2.11 hereto, (b) to the extent set forth on or reserved against in the Balance Sheet, (c) current liabilities incurred and obligations under agreements entered into in the usual and ordinary course of business since the Balance Sheet Date, none of which (individually or in the aggregate) has had or will have a material adverse effect on the Condition of the Company and (d) by the specific terms of any written agreement, document or arrangement identified in the Schedules or provided to Parent prior to closing.
2.11            Changes/Indebtedness Since the Balance Sheet Date, except as disclosed in Schedule 2.11 hereto, the Company has not (a) incurred any debts, obligations or liabilities, absolute, accrued, contingent or otherwise, whether due or to become due, except for fees, expenses and liabilities incurred in connection with the Merger and related transactions and current liabilities incurred in the usual and ordinary course of business, (b) discharged or satisfied any Liens other than those securing, or paid any obligation or liability other than, current liabilities shown on the Balance Sheet and current liabilities incurred since the Balance Sheet Date, in each case in the usual and ordinary course of business, (c) mortgaged, pledged or subjected to Lien any of its assets, tangible or intangible, other than in the usual and ordinary course of business, (d) sold, transferred or leased any of its assets, except in the usual and ordinary course of business, (e) cancelled or compromised any debt or claim, or waived or released any right, of material value, (f) suffered any physical damage, destruction or loss (whether or not covered by insurance) materially and adversely affecting the Condition of the Company, or (g) entered into any transaction other than in the usual and ordinary course of business.
2.12            Employee Benefit Plans; ERISASchedule 2.12 lists all:  (i) "employee benefit plans" as defined in Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended (" ERISA "), maintained or contributed to by the Company and covering employees of the Company, including (i) any such plans that are "employee welfare benefit plans" as defined in Section 3(1) of ERISA and (ii) any such plans that are "employee pension benefit plans" as defined in Section 3(2) of ERISA (collectively, the " Company Benefit Plans "); and (ii) life and health insurance, hospitalization, savings, bonus, deferred compensation, incentive compensation, holiday, vacation, severance pay, sick pay, sick leave, disability, tuition refund, service award, company car, scholarship, relocation, patent award, fringe benefit and other employee benefit plans, contracts (other than individual employment, consultancy or severance contracts), policies or practices of the Company providing employee or executive compensation or benefits to its employees, other than the Company Benefit Plans (collectively, the " Benefit Arrangements ").  Each Company Benefit Plan and Benefit Arrangement has been maintained and administered in all material respects in accordance with applicable law.
2.13            Title to Property and Encumbrances Except as disclosed in Schedule 2.13 hereto, the Company has good, valid and indefeasible marketable title to all properties and assets used in the conduct of its business (except for property held under valid and subsisting leases which are in full force and effect and which are not in default) free of all Liens and other encumbrances, except Permitted Liens and such ordinary and customary imperfections of title, restrictions and encumbrances as do not, individually or in the aggregate, materially detract from the value of the property or assets or materially impair the use made thereof by the Company in its business. Without limiting the generality of the foregoing, the Company has good and indefeasible title to all of its properties and assets reflected in the Balance Sheet, except for property disposed of in the usual and ordinary course of business since the Balance Sheet Date and for property held under valid and subsisting leases which are in full force and effect and which are not in default.
 
Exhibit 2.1 Merger Agreement -- Page 8

 
2.14            Litigation Except as set forth on Schedule 2.14 , there is no legal action, suit, arbitration or other legal, administrative or other governmental proceeding pending or, to the best knowledge of the Company, threatened against or affecting the Company or its properties, assets or business, and after reasonable investigation, the Company is not aware of any incident, transaction, occurrence or circumstance that is reasonably likely to result in or form the basis for any such action, suit, arbitration or other proceeding.  To the knowledge of the Company, the Company is not in default with respect to any order, writ, judgment, injunction, decree, determination or award of any court or any governmental agency or instrumentality or arbitration authority. No legal proceeding arising under or pursuant to Environmental Laws is pending, or to the knowledge of the Company, threatened, against the Company.
2.15            Disclosure There is no fact relating to the Company that the Company has not disclosed to Parent that materially and adversely affects or, insofar as the Company can now foresee, will materially and adversely affect, the condition (financial or otherwise), properties, assets, liabilities, business operations or results of operations of the Company.  No representation or warranty by the Company herein and no information disclosed in the schedules or exhibits hereto by the Company contains any untrue statement of a material fact or omits to state a material fact necessary to make the statements contained herein or therein not misleading.
2.17            Contracts.   The Company has provided, or will provide the Parent, copies of all material contracts, agreements, franchises, license agreements, or other commitments to which the Company is a party or by which it or any of its assets, products, technology, or properties are bound.
 
Exhibit 2.1 Merger Agreement -- Page 9

 
2.18            Intellectual Property .  The Company owns or has the right to use all Intellectual Property (as hereinafter defined) necessary (a) to use, manufacture, market and distribute the products manufactured, marketed, sold or licensed, and to provide the services provided, by the Company to other parties (together, the " Customer Deliverables ") and (b) to operate the internal systems of the Company that are material to its business or operations, including, without limitation, computer hardware systems, software applications and embedded systems (the " Internal Systems ").  The Intellectual Property owned by or licensed to the Company and incorporated in or underlying the Customer Deliverables or the Internal Systems is referred to herein as the " the Company Intellectual Property ").  Each item of the Company Intellectual Property will be owned or available for use by the Company immediately following the Closing on substantially identical terms and conditions as it was immediately prior to the Closing.  The Company has taken all reasonable measures to protect the proprietary nature of each item of the Company Intellectual Property.  To the knowledge of the Company, (i) no other person or entity has any rights to any of the Company Intellectual Property owned by the Company except pursuant to agreements or licenses entered into by the Company and such person in the ordinary course, and (ii) no other person or entity is infringing, violating or misappropriating any of the Company Intellectual Property.  For purposes of this Agreement, " Intellectual Property " means all patents and patent applications, copyrights and registrations thereof, computer software, data and documentation, trade secrets and confidential business information, whether patentable or unpatentable and whether or not reduced to practice, know-how, manufacturing and production processes and techniques, research and development information, copyrightable works, financial, marketing and business data, pricing and cost information, business and marketing plans and customer and supplier lists and information, trademarks, service marks, trade names, domain names and applications and registrations therefor, and other proprietary rights relating to any of the foregoing.
2.19            Certain Business Relationships With Affiliates .  Except as set forth in Schedule 2.19 hereto, or as contemplated by employment agreements, consulting agreements and the agreements contemplated by the transactions contemplated by this Agreement, no affiliate of the Company (a) owns any property or right, tangible or intangible, which is used in the business of the Company, (b) has any claim or cause of action against the Company, or (c) owes any money to, or is owed any money by, the Company.
3.            Representations and Warranties of Parent and Acquisition Corp . Parent and Acquisition Corp. jointly and severally represent and warrant to the Company, as follows:
3.1            Organization and Standing Parent is a corporation duly organized and existing in good standing under the laws of the State of Colorado.  Acquisition Corp. is a corporation duly organized and existing in good standing under the laws of the State of Colorado.  Parent and Acquisition Corp. have heretofore delivered to the Company complete and correct copies of their respective Articles or Certificates of Incorporation and By-laws as now in effect.  Parent and Acquisition Corp. have full corporate power and authority to carry on their respective businesses as they are now being conducted and as now proposed to be conducted and to own or lease their respective properties and assets.  Except as disclosed in Schedule 3.1 hereto, neither Parent nor Acquisition Corp. has any subsidiaries (except Parent as the sole stockholder of Acquisition Corp.) or direct or indirect interest (by way of stock ownership or otherwise) in any firm, corporation, limited liability company, partnership, association or business.  Parent owns all of the issued and outstanding capital stock of Acquisition Corp. free and clear of all Liens, and Acquisition Corp. has no outstanding options, warrants or rights to purchase capital stock or other equity securities of Acquisition Corp., other than the capital stock owned by Parent.  Unless the context otherwise requires, all references in this Section 3 to the "Parent" shall be treated as being a reference to the Parent and Acquisition Corp. taken together as one enterprise.
 
Exhibit 2.1 Merger Agreement -- Page 10

 
3.2             Corporate Authority Each of Parent and/or Acquisition Corp. (as the case may be) has full corporate power and authority to enter into the Merger Documents and the other agreements to be made pursuant to the Merger Documents, and to carry out the transactions contemplated hereby and thereby. All corporate acts and proceedings required for the authorization, execution, delivery and performance of the Merger Documents and such other agreements and documents by Parent and/or Acquisition Corp. (as the case may be) have been duly and validly taken or will have been so taken prior to the Closing.  Each of the Merger Documents constitutes a legal, valid and binding obligation of Parent and/or Acquisition Corp. (as the case may be), each enforceable against them in accordance with their respective terms, except as such enforcement may be limited by bankruptcy, insolvency, reorganization or other similar laws affecting creditors' rights generally and by general principles of equity.
3.3            Broker's and Finder's Fees Except as described in Section 2.8, no person, firm, corporation or other entity is entitled by reason of any act or omission of Parent or Acquisition Corp. to any broker's or finder's fees, commission or other similar compensation with respect to the execution and delivery of this Agreement or the Statement of Merger, or with respect to the consummation of the transactions contemplated hereby or thereby.  Parent and Acquisition Corp. jointly and severally indemnify and hold Company harmless from and against any and all loss, claim or liability arising out of any such claim from any other Person who claims he, she or it introduced Parent or Acquisition Corp. to, or assisted them with, the transactions contemplated by or described herein.
3.4            Capitalization of Parent   At the Effective Date, the authorized capital stock of Parent will consist of (a) 100,000,000 shares of common stock, par value $0.001 per share (the " Parent Common Stock "), of which not more than 9,517,402 shares will be, prior to the Effective Time, issued and outstanding, and (b) 1,000,000 shares of preferred stock, par value $0.10 per share (the " Parent Preferred Stock "), of which no shares are issued or outstanding.  Parent has no outstanding options, rights or commitments to issue shares of Parent Common Stock or any other Equity Security of Parent or Acquisition Corp., and there are no outstanding securities convertible or exercisable into or exchangeable for shares of Parent Common Stock or any other Equity Security of Parent or Acquisition Corp.  There is no voting trust, agreement or arrangement among any of the beneficial holders of Parent Common Stock affecting the nomination or election of directors or the exercise of the voting rights of Parent Common Stock.  All outstanding shares of the capital stock of Parent are validly issued and outstanding, fully paid and nonassessable, and none of such shares have been issued in violation of the preemptive rights of any person.
3.5             Acquisition Corp . Acquisition Corp. is a wholly-owned subsidiary of Parent that was formed specifically for the purpose of the Merger and that has not conducted any business or acquired any property, and will not conduct any business or acquire any property prior to the Closing Date, except in preparation for and otherwise in connection with the transactions contemplated by this Agreement, the Statement of Merger and the other agreements to be made pursuant to or in connection with this Agreement and the Statement of Merger.
 
Exhibit 2.1 Merger Agreement -- Page 11

 
3.6            Validity of Shares The 40,482,598 shares of Parent Common Stock expected to be issued at the Closing pursuant to Section 1.5(a)(ii) hereof (inclusive of up to 2,000,000 shares issued for 2,000,000 shares of Company Common Stock to be issued in the Offering), when issued and delivered in accordance with the terms hereof and of the Statement of Merger, shall be duly and validly issued, fully paid and nonassessable.  The Parent Warrants to be issued at the Closing pursuant to Section 1.5(a)(v), when issued and delivered in accordance with the terms hereof and of the Statement of Merger, shall be duly and validly issued, fully paid and nonassessable.   Based in part on the representations and warranties of the Stockholders as contemplated by Section 4 hereof and assuming the accuracy thereof, the issuance of the Parent Common Stock upon the Merger pursuant to Section 1.5(a)(ii) will be exempt from the registration and prospectus delivery requirements of the Securities Act and from the qualification or registration requirements of any applicable state blue sky or securities laws.
3.7            SEC Reporting and Compliance   (a)     Parent filed a registration statement on Form SB-2 under the Securities Act which became effective on January 17, 2008. Parent has filed with the Commission all reports required to be filed by companies registered pursuant to Section 12(g) of the Exchange Act.
(b)            Parent has delivered to the Company true and complete copies of all annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and other statements reports and filings (collectively, the " Parent SEC Documents ") filed by the Parent with the Commission. None of Parent's Subsidiaries is required to file any documents with the Commission.  As of the time it was filed with the Commission (or, if amended or superseded by a filing prior to the date of this Agreement, then on the date of such filing): (i) each of the Parent SEC Documents complied as to form in all material respects with the applicable requirements of the Securities Act or the Exchange Act (as the case may be); and (ii) none of the Parent SEC Documents contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made and taking into account the requirements applicable to the respective Parent SEC Document, not misleading, except to the extent corrected: (A) in the case of Parent SEC Documents filed or furnished on or prior to the date of this Agreement that were amended or superseded on or prior to the date of this Agreement, by the filing or furnishing of the applicable amending or superseding Parent SEC Document; and (B) in the case of Parent SEC Documents filed or furnished after the date of this Agreement that are amended or superseded prior to the Effective Time, by the filing or furnishing of the applicable amending or superseding Parent SEC Document.  The certifications and statements relating to the Parent SEC Documents required by: (A) Rule 13a-14 or Rule 15d-14 under the Exchange Act; (B) 18 U.S.C. §1350 (Section 906 of the Sarbanes-Oxley Act); or (C) any other rule or regulation promulgated by the SEC or applicable to the Parent SEC Documents are accurate and complete, and comply as to form and content with all applicable Legal Requirements.
 
Exhibit 2.1 Merger Agreement -- Page 12

 
(c)            Parent has not filed, and nothing has occurred with respect to which Parent would be required to file, any report on Form 8-K since December 1, 2017.  Prior to and until the Closing, Parent will provide to the Company copies of any and all amendments or supplements to the Parent SEC Documents filed with the Commission since December 1, 2017 and any and all subsequent statements, reports and filings filed by the Parent with the Commission or delivered to the stockholders of Parent.
(d)            The shares of Parent Common Stock are quoted on the OTCPink marketplace.
(e)            Between the date hereof and the Closing Date, Parent shall continue to satisfy the filing requirements of the Exchange Act.
3.8             Financial Statements The balance sheets, and statements of operations, statements of changes in shareholders' equity and statements of cash flows contained in the Parent SEC Documents (the " Parent Financial Statements ") (i) have been prepared in accordance with GAAP applied on a basis consistent with prior periods (and, in the case of unaudited financial information, on a basis consistent with year-end audits), (ii) are in accordance with the books and records of the Parent, and (iii) present fairly in all material respects the financial condition of the Parent at the dates therein specified and the results of its operations and changes in financial position for the periods therein specified.  The financial statements included in the Annual Report on Form 10-K for the fiscal year ended December 31, 2016, are audited by, and include the related report of EKS&H, LLLP, Parent's independent certified public accountants.
3.9            Governmental Consents All consents, approvals, orders, or authorizations of, or registrations, qualifications, designations, declarations, or filings with any federal or state governmental authority on the part of Parent or Acquisition Corp. required in connection with the consummation of the Merger shall have been obtained prior to, and be effective as of, the Closing.
3.10            Compliance with Laws and Instruments The execution, delivery and performance by Parent and/or Acquisition Corp. of this Agreement, the Statement of Merger and the other agreements to be made by Parent or Acquisition Corp. pursuant to or in connection with this Agreement or the Statement of Merger and the consummation by Parent and/or Acquisition Corp. of the transactions contemplated by the Merger Documents will not cause Parent and/or Acquisition Corp. to violate or contravene (i) any provision of law, (ii) any rule or regulation of any agency or government, (iii) any order, judgment or decree of any court, or (v) any provision of their respective articles or Articles of incorporation or by-laws as amended and in effect on and as of the Closing Date and will not violate or be in conflict with, result in a breach of or constitute (with or without notice or lapse of time, or both) a default under any indenture, loan or credit agreement, deed of trust, mortgage, security agreement or other agreement or contract to which Parent or Acquisition Corp. is a party or by which Parent and/or Acquisition Corp. or any of their respective properties is bound.
3.11            No General Solicitation In issuing Parent Common Stock in the Merger hereunder, neither Parent nor anyone acting on its behalf has offered to sell the Parent Common Stock by any form of general solicitation or advertising.
 
Exhibit 2.1 Merger Agreement -- Page 13

 
3.12            Binding Obligations The Merger Documents constitute the legal, valid and binding obligations of the Parent and Acquisition Corp., and are enforceable against the Parent and Acquisition Corp., in accordance with their respective terms, except as such enforcement is limited by bankruptcy, insolvency and other similar laws affecting the enforcement of creditors' rights generally and by general principles of equity.
3.13            Absence of Undisclosed Liabilities Neither Parent nor Acquisition Corp. has any obligation or liability (whether accrued, absolute, contingent, liquidated or otherwise, whether due or to become due), arising out of any transaction entered into at or prior to the Closing, except (a) as disclosed in the Parent SEC Documents, (b) to the extent set forth on or reserved against in the audited balance sheet of Parent as of December 31, 2016 (the " Parent Balance Sheet ") or the Notes to the Parent Financial Statements, (c) current liabilities incurred and obligations under agreements entered into in the usual and ordinary course of business since September 30, 2017 (the " Parent Balance Sheet Date "), none of which (individually or in the aggregate) materially and adversely affects the condition (financial or otherwise), properties, assets, liabilities, business operations, results of operations or prospects of the Parent or Acquisition Corp., taken as a whole (the " Condition of the Parent "), and (d) by the specific terms of any written agreement, document or arrangement attached as an exhibit to the Parent SEC Documents.
3.14            Changes Since the Parent Balance Sheet Date, except as disclosed in the Parent SEC Documents, the Parent has not (a) incurred any debts, obligations or liabilities, absolute, accrued or, to the Parent's knowledge, contingent, whether due or to become due, except for current liabilities incurred in the usual and ordinary course of business, (b) discharged or satisfied any Liens other than those securing, or paid any obligation or liability other than, current liabilities shown on the Parent Balance Sheet and current liabilities incurred since the Parent Balance Sheet Date, in each case in the usual and ordinary course of business, (c) mortgaged, pledged or subjected to Lien any of its assets, tangible or intangible, other than in the usual and ordinary course of business, (d) cancelled or compromised any debt or claim, or waived or released any right of material value, (e) suffered any physical damage, destruction or loss (whether or not covered by insurance) which could reasonably be expected to have a material adverse effect on the Condition of the Parent, (f) entered into any transaction other than in the usual and ordinary course of business, (g) encountered any labor union difficulties, (h) made or granted any wage or salary increase or made any increase in the amounts payable under any profit sharing, bonus, deferred compensation, severance pay, insurance, pension, retirement or other employee benefit plan, agreement or arrangement, other than in the ordinary course of business consistent with past practice, or entered into any employment agreement, (i) issued or sold any shares of capital stock, bonds, notes, debentures or other securities or granted any options (including employee stock options), warrants or other rights with respect thereto, (j) declared or paid any dividends on or made any other distributions with respect to, or purchased or redeemed, any of its outstanding capital stock, (k) suffered or experienced any change in, or condition affecting, the financial condition of the Parent other than changes, events or conditions in the usual and ordinary course of its business, none of which (either by itself or in conjunction with all such other changes, events and conditions) could reasonably be expected to have a material adverse effect on the Condition of the Parent, (l) made any change in the accounting principles, methods or practices followed by it or depreciation or amortization policies or rates theretofore adopted, (m) made or permitted any amendment or termination of any material contract, agreement or license to which it is a party, (n) suffered any material loss not reflected in the Parent Balance Sheet or its statement of income for the year ended on the Parent Balance Sheet Date, (o) paid, or made any accrual or arrangement for payment of, bonuses or special compensation of any kind or any severance or termination pay to any present or former officer, director, employee, stockholder or consultant, (p) made or agreed to make any charitable contributions or incurred any non-business expenses in excess of $5,000 in the aggregate, or (q) entered into any agreement, or otherwise obligated itself, to do any of the foregoing.
 
Exhibit 2.1 Merger Agreement -- Page 14

 
3.15            Tax Returns and Audits All required federal, state and local Tax Returns of the Parent have been accurately prepared in all material respects and duly and timely filed, and all federal, state and local Taxes required to be paid with respect to the periods covered by such returns have been paid to the extent that the same are material and have become due, except where the failure so to file or pay could not reasonably be expected to have a material adverse effect upon the Condition of the Parent.  The Parent is not and has not been delinquent in the payment of any Tax.  The Parent has not had a Tax deficiency assessed against it.  None of the Parent's federal income tax returns nor any state or local income or franchise tax returns has been audited by governmental authorities.  The reserves for Taxes reflected on the Parent Balance Sheet are sufficient for the payment of all unpaid Taxes payable by the Parent with respect to the period ended on the Parent Balance Sheet Date.  There are no federal, state, local or foreign audits, actions, suits, proceedings, investigations, claims or administrative proceedings relating to Taxes or any Tax Returns of the Parent now pending, and the Parent has not received any notice of any proposed audits, investigations, claims or administrative proceedings relating to Taxes or any Tax Returns.
3.16            Employment Matters; Employee Benefit Plans; ERISA There is no claim or grievance pending or threatened relating to any employment contract, wages and hours, leave of absence, plant closing notification, employment statute or regulation, work rule (together with all policies and supplements related thereto), privacy right, labor dispute, safety, retaliation, immigration or discrimination matters involving any Parent associate, including charges of unfair labor practices or harassment complaints. There are no "employee benefit plans" (within the meaning of Section 3(3) of ERISA) nor any other employee benefit or fringe benefit arrangements, practices, contracts, policies or programs other than programs merely involving the regular payment of wages, commissions, or bonuses established, maintained or contributed to by the Parent.
3.17            Litigation There is no legal action, suit, arbitration or other legal, administrative or other governmental proceeding pending or, to the knowledge of the Parent, threatened against or affecting the Parent or Acquisition Corp. or their properties, assets or business, and after reasonable investigation, the Parent is not aware of any incident, transaction, occurrence or circumstance that is reasonably likely to result in or form the basis for any such action, suit, arbitration or other proceeding.  To the knowledge of the Parent, neither Parent nor Acquisition Corp. is in default with respect to any order, writ, judgment, injunction, decree, determination or award of any court or any governmental agency or instrumentality or arbitration authority. No legal proceeding arising under or pursuant to Environmental Laws is pending, or to the knowledge of the Parent, threatened, against the Parent or Acquisition Corp.
 
Exhibit 2.1 Merger Agreement -- Page 15

 
4.              Conduct of Businesses Pending the Merger .
4.1            Conduct of Business by the Company Pending the Merger Prior to the Effective Time, unless Parent or Acquisition Corp. shall otherwise agree in writing or as otherwise contemplated by this Agreement:
(a)            the business of the Company shall be conducted only in the ordinary course;
(b)            the Company shall not (i) directly or indirectly redeem, purchase or otherwise acquire or agree to redeem, purchase or otherwise acquire any shares of its capital stock; (ii) amend its Articles of Incorporation or By-laws; or (iii) split, combine or reclassify the outstanding Company Common Stock or declare, set aside or pay any dividend payable in cash, stock or property or make any distribution with respect to any such stock;
(c)            the Company shall not (i) issue or agree to issue any additional shares of, or options, warrants or rights of any kind to acquire any shares of, Company Common Stock; (ii) acquire or dispose of any fixed assets or acquire or dispose of any other substantial assets other than in the ordinary course of business; (iii) incur additional Indebtedness or any other liabilities or enter into any other transaction other than in the ordinary course of business; (iv) enter into any contract, agreement, commitment or arrangement with respect to any of the foregoing; or (v) except as contemplated by this Agreement, enter into any contract, agreement, commitment or arrangement to dissolve, merge, consolidate or enter into any other material business combination;
(d)            the Company shall use its best efforts to preserve intact the business organization of the Company, to keep available the service of its present officers and key employees, and to preserve the good will of those having business relationships with it;
(e)            the Company will not, nor will it authorize any director or authorize or permit any officer or employee or any attorney, accountant or other representative retained by it to, make, solicit, encourage any inquiries with respect to, or engage in any negotiations concerning, any Acquisition Proposal (as defined below).  The Company will promptly advise Parent orally and in writing of any such inquiries or proposals (or requests for information) and the substance thereof.  As used in this paragraph, " Acquisition Proposal " shall mean any proposal for a merger or other business combination involving the Company or for the acquisition of a substantial equity interest in it or any material assets of it other than as contemplated by this Agreement.  The Company will immediately cease and cause to be terminated any existing activities, discussions or negotiations with any person conducted heretofore with respect to any of the foregoing; and
(f)            the Company will not enter into any new employment agreements with any of its officers or employees or grant any increases in the compensation or benefits of its officers and employees other than increases in the ordinary course of business and consistent with past practice or amend any employee benefit plan or arrangement.
 
Exhibit 2.1 Merger Agreement -- Page 16

 
4.2             Conduct of Business by Parent and Acquisition Corp. Pending the Merger Prior to the Effective Time, unless the Company shall otherwise agree in writing or as otherwise contemplated by this Agreement:
(a)            the business of Parent and Acquisition Corp. shall be conducted only in the ordinary course; provided , however , that Parent shall take the steps necessary to have discontinued its existing business without liability to Parent or Acquisition Corp. as of the Closing Date;
(b)            neither Parent nor Acquisition Corp. shall (A) directly or indirectly redeem, purchase or otherwise acquire or agree to redeem, purchase or otherwise acquire any shares of its capital stock; (B) amend its articles or Articles of incorporation or by-laws; or (C) split, combine or reclassify its capital stock or declare, set aside or pay any dividend payable in cash, stock or property or make any distribution with respect to such stock, with the exception of cash dividends to be distributed to the pre-merger shareholders of the Parent, subsequent to the sale of various assets of Parent, including, but not limited to Parent's NexCore assets, which shall take place prior to, or concurrent with, the Closing; and
(c)            neither Parent nor Acquisition Corp. shall (A) issue or agree to issue any additional shares of, or options, warrants or rights of any kind to acquire shares of, its capital stock; (B) acquire or dispose of any assets other than in the ordinary course of business (except for dispositions in connection with Sections 4.2(a) and 4.2(b) hereof); (C) incur additional Indebtedness or any other liabilities or enter into any other transaction except in the ordinary course of business; (D) enter into any contract, agreement, commitment or arrangement with respect to any of the foregoing, or (E) except as contemplated by this Agreement, enter into any contract, agreement, commitment or arrangement to dissolve, merge; consolidate or enter into any other material business contract or enter into any negotiations in connection therewith.
(d)            neither Parent nor Acquisition Corp. will, nor will they authorize any director or authorize or permit any officer or employee or any attorney, accountant or other representative retained by them to, make, solicit, encourage any inquiries with respect to, or engage in any negotiations concerning, any Acquisition Proposal (as defined below for purposes of this paragraph).  Parent will promptly advise the Company orally and in writing of any such inquiries or proposals (or requests for information) and the substance thereof.  As used in this paragraph, " Acquisition Proposal " shall mean any proposal for a merger or other business combination involving the Parent or Acquisition Corp. or for the acquisition of a substantial equity interest in either of them or any material assets of either of them other than as contemplated by this Agreement.  Parent will immediately cease and cause to be terminated any existing activities, discussions or negotiations with any person conducted heretofore with respect to any of the foregoing; and
(e)   neither the Parent nor Acquisition Corp. will enter into any new employment agreements with any of their officers or employees or grant any increases in the compensation or benefits of their officers or employees.
 
Exhibit 2.1 Merger Agreement -- Page 17

 
5.            Additional Agreements .
5.1             Access and Information The Company, Parent and Acquisition Corp. shall each afford to the other and to the other's accountants, counsel and other representatives full access during normal business hours throughout the period prior to the Effective Time of all of its properties, books, contracts, commitments and records (including but not limited to tax returns) and during such period, each shall furnish promptly to the other all information concerning its business, properties and personnel as such other party may reasonably request; provided , that no investigation pursuant to this Section 5.1 shall affect any representations or warranties made herein.  Each party shall hold, and shall cause its employees and agents to hold, in confidence all such information (other than such information which (i) is already in such party's possession or (ii) becomes generally available to the public other than as a result of a disclosure by such party or its directors, officers, managers, employees, agents or advisors, or (iii) becomes available to such party on a non-confidential basis from a source other than a party hereto or its advisors, provided that such source is not known by such party to be bound by a confidentiality agreement with or other obligation of secrecy to a party hereto or another party until such time as such information is otherwise publicly available; provided , however , that (A) any such information may be disclosed to such party's directors, officers, employees and representatives of such party's advisors who need to know such information for the purpose of evaluating the transactions contemplated hereby (it being understood that such directors, officers, employees and representatives shall be informed by such party of the confidential nature of such information), (B) any disclosure of such information may be made as to which the party hereto furnishing such information has consented in writing, and (C) any such information may be disclosed pursuant to a judicial, administrative or governmental order or request; provided , however , that the requested party will promptly so notify the other party so that the other party may seek a protective order or appropriate remedy and/or waive compliance with this Agreement and if such protective order or other remedy is not obtained or the other party waives compliance with this provision, the requested party will furnish only that portion of such information which is legally required and will exercise its best efforts to obtain a protective order or other reliable assurance that confidential treatment will be accorded the information furnished).  If this Agreement is terminated, each party will deliver to the other all documents and other materials (including copies) obtained by such party or on its behalf from the other party as a result of this Agreement or in connection herewith, whether so obtained before or after the execution hereof.
5.2       Additional Agreements Subject to the terms and conditions herein provided, each of the parties hereto agrees to use its commercially reasonable efforts to take, or cause to be taken, all action and to do, or cause to be done, all things necessary, proper or advisable under applicable laws and regulations to consummate and make effective the transactions contemplated by this Agreement, including using its commercially reasonable efforts to satisfy the conditions precedent to the obligations of any of the parties hereto to obtain all necessary waivers, and to lift any injunction or other legal bar to the Merger (and, in such case, to proceed with the Merger as expeditiously as possible).  In order to obtain any necessary governmental or regulatory action or non-action, waiver, consent, extension or approval, each of Parent, Acquisition Corp. and the Company agrees to take all reasonable actions and to enter into all reasonable agreements as may be necessary to obtain timely governmental or regulatory approvals and to take such further action in connection therewith as may be necessary.  In case at any time after the Effective Time any further action is necessary or desirable to carry out the purposes of this Agreement, the proper officers and/or directors of Parent, Acquisition Corp. and the Company shall take all such necessary action. Without limiting the foregoing, Parent shall cooperate with the Company and provide all information reasonably requested to prepare and distribute a proxy or information statement to obtain the Company Stockholders' approval or consent for the Merger and related matters.
 
Exhibit 2.1 Merger Agreement -- Page 18

 
5.3            Publicity No party shall issue any press release or public announcement pertaining to the Merger that has not been agreed upon in advance by Parent and the Company, except as Parent reasonably determines to be necessary in order to comply with the rules of the Commission or of the principal trading exchange or market for Parent Common Stock; provided , that in such case Parent will use its best efforts to allow the Company to review and reasonably approve any press release or public announcement prior to its release.
5.4            Appointment of Directors Parent shall accept the resignation of the current officers and directors of Parent as provided by Section 6.2 hereof, and shall cause the persons listed as directors in Exhibit G hereto (such persons, the "New Directors") to be elected to the Board of Directors of Parent, in each case immediately upon the Effective Time, except that the resignation and election of certain directors (as identified on Exhibit G) shall be delayed until compliance with Section 14(f) of the Exchange Act and rules promulgated thereunder, as set forth in Section 6.2 hereof (which the Surviving Company agrees to comply with promptly following the Effective Time, and in any event within two business days of the Effective Time).  Pending election of the New Directors as contemplated in this Section 5.4, except with the express written consent of James Garvin or as expressly authorized by this Agreement,
(a)           neither Parent nor the Surviving Corporation shall:
                      (i)           take any actions inconsistent with this Agreement,
                      (ii)          incur any expenditures in excess of $25,000 in the aggregate;
                       (iii)          directly or indirectly redeem, purchase or otherwise acquire or agree to redeem, purchase or otherwise acquire any shares of its capital stock;
                       (iv)          amend its articles or Articles of incorporation or by-laws;     
                       (v)           split, combine or reclassify its capital stock or declare, set aside or pay any dividend payable in cash, stock or property or make any distribution with respect to such stock;
                       (vi)          issue or agree to issue any additional shares of, or options, warrants or rights of any kind to acquire shares of, its capital stock;
                       (vii)        acquire or dispose of any assets;
                       (viii)        incur Indebtedness or any other liabilities or enter or obligate itself to enter into any transaction;
 
Exhibit 2.1 Merger Agreement -- Page 19

 
                       (ix)          enter into any contract, agreement, commitment or arrangement to dissolve, merge, consolidate or enter into, amend or otherwise alter any other material business contract or enter into any negotiations in connection therewith;
                       (x)           enter into, amend or otherwise alter any employment agreements with any of their officers or employees or grant any increases in the compensation or benefits of their officers or employees; or
                      (xi)         enter into, or obligate itself to enter into, any contract, agreement, commitment or arrangement with respect to any of the foregoing; and
(b)         Parent and the Surviving Corporation shall:
(i)            take all actions reasonably requested by James Garvin (the parties agreeing that an action is reasonably requested if the action is consistent with the conduct of the Company's business as it existed immediately prior to the Effective Time);
(ii)            from and after the Effective Time, conduct the business of Parent and the Surviving Corporation in the ordinary course of the Company's business as it existed immediately prior to the Effective Time; and
(iii)            consult with James Garvin prior to taking any action.
The Parent shall cause the Surviving Corporation to comply with the provisions of this Section 5.4.  The parties acknowledge and agree that it would be impossible or inadequate to measure and calculate the Company's and the Company's Stockholders' damages from a breach of this Section 5.4.  Accordingly, the parties agree that if either Parent or the Surviving Corporation breaches, or threatens to breach, any provision of this Section 5.4, James Garvin on behalf of the Company and the Company Stockholders will have available, in addition to any other right or remedy available, the right to obtain an injunction from a court of competent jurisdiction restraining such breach or threatened breach and to specific performance of such provisions.  The parties further agree that no bond or other security shall be required in obtaining such equitable relief, or if a bond or other security is required, the amount of such bond or other security shall not exceed $100, and the Parent and the Surviving Corporation hereby consent to the issuance of such injunction and to the ordering of specific performance. The parties agree that James Garvin is an express intended third party beneficiary of the provisions of this Section 5.4 and may enforce such provisions as if he was a party hereto.
At the first annual meeting of Parent stockholders and thereafter, the election of members of Parent's Board of Directors shall be accomplished in accordance with the by-laws of Parent.
5.5            Parent Name Change and Amendment to Articles of Incorporation. As soon as practicable following the Closing, the Surviving Entity shall take all required legal actions, including the filing of a Proxy Statement on Schedule 14A, or an Information Statement on Schedule 14C under the Exchange Act, to amend the Parent's articles of incorporation in order to 1) include provisions similar to those found in articles of incorporation customarily used by public companies, 2) cancel the Parent's preferred class of shares, 3) change its corporate name to CytoBioscience, Inc. or some derivation thereof, and 4) adopt any other changes reasonable necessary to effect the provisions of this Agreement.
 
Exhibit 2.1 Merger Agreement -- Page 20

 
5.6            Stockholder Approval. The Company shall, in accordance with the DGCL and its certificate of incorporation and bylaws, duly call, give notice of, convene and hold a special meeting of the Stockholders as promptly as practicable after the date hereof for the purpose of considering and taking action upon this Agreement and the Merger (the "Company Stockholder Consent").  Alternatively, the Company shall use its best efforts to obtain, in lieu of holding the stockholder meeting, the written consent of Company stockholders and/or waivers necessary under its certificate of incorporation, bylaws and the DGCL to obtain the Company Stockholder Consent.
6.            Conditions of Parties' Obligations .
6.1            Conditions to Obligations of Parent and Acquisition Corp. The obligations of Parent and Acquisition Corp. under this Agreement and the Statement of Merger are subject to the fulfillment at or prior to the Closing of the following conditions, any of which may be waived in whole or in part by Parent.
(a)            No Errors, etc . The representations and warranties of the Company under this Agreement shall be deemed to have been made again on the Closing Date and shall then be true and correct in all material respects.
(b)            Compliance with Agreement .  The Company shall have performed and complied in all material respects with all agreements and conditions required by this Agreement to be performed or complied with by it on or before the Closing Date.
(c)            No Default or Adverse Change .  There shall not exist on the Closing Date any Default or Event of Default or any event or condition that, with the giving of notice or lapse of time, or both, would constitute a Default or Event of Default, and since the Balance Sheet Date, there shall have been no material adverse change in the Condition of the Company.
(d)            Certificate of Officer .  The Company shall have delivered to Parent and Acquisition Corp. a certificate dated the Closing Date, executed on its behalf by James Garvin, CEO of the Company, certifying the satisfaction of the conditions specified in paragraphs (a), (b) and (c) of this Section 6.1.
(e)            No Restraining Action .  No action or proceeding before any court, governmental body or agency shall have been threatened, asserted or instituted to restrain or prohibit, or to obtain substantial damages in respect of, this Agreement or the Statement of Merger or the carrying out of the transactions contemplated by the Merger Documents.
(f)            Supporting Documents .  Parent and Acquisition Corp. shall have received the following:
 
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(1)            Copies of resolutions of the Board of Directors and the Stockholders of the Company, certified by the Secretary of the Company, authorizing and approving the execution, delivery and performance of the Merger Documents and all other documents and instruments to be delivered pursuant hereto and thereto.
(2)            A certificate of incumbency executed by the Secretary of the Company certifying the names, titles and signatures of the officers authorized to execute any documents referred to in this Agreement and further certifying that the Articles of Incorporation and By-laws of the Company delivered to Parent and Acquisition Corp. at the time of the execution of this Agreement have been validly adopted and have not been amended or modified.
(3)            A certificate, dated the Closing Date, executed by the Company's Secretary, certifying that, except for the filing of the Statement of Merger:  (i) all consents, authorizations, orders and approvals of, and filings and registrations with, any court, governmental body or instrumentality that are required for the execution and delivery of this Agreement and the Statement of Merger and the consummation of the Merger shall have been duly made or obtained, and all material consents by third parties that are required for the Merger have been obtained; and (ii) no action or proceeding before any court, governmental body or agency has been threatened, asserted or instituted to restrain or prohibit, or to obtain substantial damages in respect of, this Agreement or the Statement of Merger or the carrying out of the transactions contemplated by the Merger Documents.
(4)            Evidence as of a recent date of the good standing and corporate existence of the Company issued by the Secretary of State of the State of Delaware and evidence that the Company is qualified to transact business as a  corporation and is in good standing in  each other state of the United States and in each other jurisdiction where the character of the property owned or leased by it or the nature of its activities makes such qualification necessary.
(5)            The Company Stockholder Consent.
(6)            The signed lock-up agreements referenced in Section 1 of this Agreement.
(7)            Such additional supporting documentation and other information with respect to the transactions contemplated hereby as Parent and Acquisition Corp. may reasonably request.
(g)            Proceedings and Documents .  All corporate and other proceedings and actions taken in connection with the transactions contemplated hereby and all certificates, opinions, agreements, instruments and documents mentioned herein or incident to any such transactions shall be reasonably satisfactory in form and substance to Parent and Acquisition Corp.  The Company shall furnish to Parent and Acquisition Corp. such supporting documentation and evidence of the satisfaction of any or all of the conditions precedent specified in this Section 6.1 as Parent or its counsel may reasonably request.
 
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(h)            Financial Statements.   Company shall have provided parent with its audited financial statements for the years ended December 31, 2016 and 2015, as well as unaudited, reviewed financial statements for the nine month period ended September 30, 2017.
(i)            Offering. The Company shall have engaged a broker/dealer to commence an equity offering in an amount of $1,500,000 (the "Offering"). The Offering will include shares of Company Common Stock which will convert to up to 2,000,000 shares of Parent Common Stock and warrant which will be converted on a one-for-one basis to warrants for Parent Common Stock exercisable contingent upon the authorization of additional shares. The parties agree that Divine Capital will be an acceptable broker to conduct the Offering, and that the broker will be paid a cash success fee of between 4% and 8% of the proceeds of the Offering (4% on $750,000 and 8% on the remaining $750,000 plus up to 160,000 warrants, representing 8% of the Offering proceeds, which will convert to Parent Company warrants exercisable contingent upon the additional authorized shares).
6.2      Conditions to Obligations of Company. The obligations of the Company under this Agreement and the Statement of Merger are subject to the fulfillment at or prior to the Closing of the conditions precedent specified in paragraph (f) of Section 6.1 hereof and the following additional conditions:
(a)            No Errors, etc.   The representations and warranties of Parent and Acquisition Corp. under this Agreement shall be deemed to have been made again on the Closing Date and shall then be true and correct in all material respects.
(b)            Compliance with Agreement .  Parent and Acquisition Corp. shall have performed and complied in all material respects with all agreements and conditions required by this Agreement and the Statement of Merger to be performed or complied with by them on or before the Closing Date.
(c)            No Default or Adverse Change .  There shall not exist on the Closing Date any Default or Event of Default or any event or condition, that with the giving of notice or lapse of time, or both, would constitute a Default of Event of Default, and since the Parent Balance Sheet Date, there shall have been no material adverse change in the Condition of the Parent.
(d)            Certificate of Officer .  Parent and Acquisition Corp. shall have delivered to the Company a certificate dated the Closing Date, executed on their behalf by their respective President, certifying the satisfaction of the conditions specified in paragraphs (a), (b), and (c) of this Section 6.2.
(e)            No Restraining Action .  No action or proceeding before any court, governmental body or agency shall have been threatened, asserted or instituted to restrain or prohibit, or to obtain substantial damages in respect of, this Agreement or the Statement of Merger or the carrying out of the transactions contemplated by the Merger Documents
(f)            Supporting Documents .  The Company shall have received the following:
 
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(1)            Copies of resolutions of Parent's and Acquisition Corp.'s respective boards of directors and the sole shareholder of Acquisition Corp., certified by their respective Secretaries, authorizing and approving, to the extent applicable, the execution, delivery and performance of this Agreement, the Statement of Merger and all other documents and instruments to be delivered by them pursuant hereto and thereto.
(2)            A certificate of incumbency executed by the respective Secretaries of Parent and Acquisition Corp. certifying the names, titles and signatures of the officers authorized to execute the documents referred to in paragraph (1) above and further certifying that the articles or certificates of incorporation and by-laws of Parent and Acquisition Corp. appended thereto have not been amended or modified.
(3)            A certificate, dated the Closing Date, executed by the Secretary of each of the Parent and Acquisition Corp., certifying that, except for the filing of the Statement of Merger:  (i) all consents, authorizations, orders and approvals of, and filings and registrations with, any court, governmental body or instrumentality that are required for the execution and delivery of this Agreement and the Statement of Merger and the consummation of the Merger shall have been duly made or obtained, and all material consents by third parties required for the Merger have been obtained; and (ii) no action or proceeding before any court, governmental body or agency has been threatened, asserted or instituted to restrain or prohibit, or to obtain substantial damages in respect of, this Agreement or the Statement of Merger or the carrying out of the transactions contemplated by any of the Merger Documents.
(4)            A certificate of Corporate Stock Transfer, Inc., Parent's transfer agent and registrar, certifying as of the business day prior to the Closing Date, a true and complete list of the names and addresses of the record owners of all of the outstanding shares of Parent Common Stock, together with the number of shares of Parent Common Stock held by each record owner.
(5)            A letter from Corporate Stock Transfer, Inc., Parent's transfer agent and registrar setting forth that the number of shares of Parent Common Stock that would be issued and outstanding as of the Closing Date but prior to the closing of the Merger, is no more than 9,517,402 shares of Parent Common.
(6)            An agreement in writing from EKS&H, LLLP, in form and substance reasonably satisfactory to the Company, to deliver copies of the audit opinions and audit reports with respect to any and all financial statements of Parent that had been audited by such firm.
(7)            The executed resignation of Brian L. Klemsz, Steve Anderson, and Joni Troska as officers of Parent, with the officer resignation to take effect at the Effective Time, and with the resignation of Mr. Klemsz as a director to take effect upon Parent's compliance with Section 14(f) of the Exchange Act and rules promulgated thereunder.
 
Exhibit 2.1 Merger Agreement -- Page 24

 
(8)            Evidence as of a recent date of the good standing and corporate existence of the Parent made available to the Company by the Secretary of State of Colorado and evidence that the Parent is qualified to transact business as a foreign corporation and is in good standing in each state of the United States and in each other jurisdiction where the character of the property owned or leased by it or the nature of its activities makes such qualification necessary.
(9)            Evidence as of a recent date of the good standing and corporate existence of Acquisition Corp. issued by the Secretary of State of Colorado.
(10)            Evidence as of no later than the closing date that all employees of Parent and Acquisition Corp. have either been terminated or offered employment with an entity which will be unrelated to the Surviving Corporation post-closing, and evidence that all items of compensation, severance and related Taxes and benefits have been satisfied pre-closing or will be satisfied post-closing with no further payment or obligation on the part of Parent or Surviving Corporation, except for the Holdover Employees.
(11)            The Company Stockholder Consent.
(12)            The signed lock-up agreements referenced in Section 1 of this Agreement.
(13)            Such additional supporting documentation and other information with respect to the transactions contemplated hereby as the Company may reasonably request.
(g)            Proceedings and Documents .  All corporate and other proceedings and actions taken in connection with the transactions contemplated hereby and all certificates, opinions, agreements, instruments and documents mentioned herein or incident to any such transactions shall be satisfactory in form and substance to the Company. Parent and Acquisition Corp. shall furnish to the Company such supporting documentation and evidence of satisfaction of any or all of the conditions specified in this Section 6.2 as the Company may reasonably request.
(h)            Cash at Closing.    Parent shall have cash on hand in an amount of $500,000 net cash, plus the Holdover Employee Amount in Parent's bank account which shall be unencumbered and available for use by the Surviving Entity.
(i)            Offering Commitment.    Parent shall have committed investors to purchase at least $750,000 of securities in the Offering, at a price per unit of $0.75.
The Company may waive compliance with any of the conditions precedent specified in this Section 6.2.
7.            Survival of Representations and Warranties The representations and warranties of the parties made in Sections 2 and 3 of this Agreement (including the Schedules to the Agreement which are hereby incorporated by reference) shall survive for twelve months beyond the Effective Time.  This Section 7 shall not limit any claim for fraud or any covenant or agreement of the parties which by its terms contemplates performance after the Effective Time.
 
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8.            Amendment of Agreement This Agreement and the Statement of Merger may be amended or modified at any time in all respects by an instrument in writing executed (i) in the case of this Agreement by the parties hereto and (ii) in the case of the Statement of Merger by the parties thereto.
9.            Definitions Unless the context otherwise requires, the terms defined in this Section 9 shall have the meanings herein specified for all purposes of this Agreement, applicable to both the singular and plural forms of any of the terms herein defined.
" Acquisition Corp ." means WASM ACQUISITION Corp., a Colorado corporation.
" Acquisition Proposal " shall have the meaning assigned to such term in each of Section 5.1(e) and Section 5.2(d) hereof, as applicable.
" Affiliate " shall mean any Person that directly or indirectly controls, is controlled by, or is under common control with, the indicated Person.
" Agreement " shall mean this Agreement.
" Balance Sheet " and " Balance Sheet Date " shall have the meanings assigned to such terms in Section 2.9 hereof.
" Benefit Arrangements " shall have the meaning assigned to it in Section 2.12 hereof.
" Statement of Merger " shall have the meaning assigned to it in the second recital of this Agreement.
" Closing " and " Closing Date " shall have the meanings assigned to such terms in Section 10 hereof.
" Code " shall mean the Internal Revenue Code of 1986, as amended.
" Commission " shall mean the U.S. Securities and Exchange Commission.
" Company " shall mean CytoBioscience., a Delaware corporation.
" Company Common Stock " shall have the meaning assigned to it in Section 1.5(a)(ii).
" Company Benefit Plans " shall have the meaning assigned to it in Section 2.12 hereof.
 " Company Stockholder Consent " shall have the meaning assigned to it in Section 5.6.
 
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" Company Warrants " shall have the meaning assigned to it in Section 1.7(a) hereof.
" Condition of the Company " shall have the meaning assigned to it in Section 2.2 hereof.
" Condition of the Parent " shall have the meaning assigned to it in Section 3.13 hereof.
" Constituent Corporations " shall have the meaning assigned to it in Section 1.4 hereof.
" Default " shall mean a default or failure in the due observance or performance of any covenant, condition or agreement on the part of the Company to be observed or performed under the terms of this Agreement or the Statement of Merger, if such default or failure in performance shall remain unremedied for five (5) days.
" BCA " shall have the meaning assigned to it in the second recital hereof.
" DGCL " shall have the meaning assigned to it in the second recital hereof.
" Effective Time " shall have the meaning assigned to it in Section 1.2 hereof.
" Environmental Laws " shall mean any federal, state, local, municipal, foreign or other law, statute, principle of common law, resolution, ordinance, code, edict, decree, rule, regulation, order, award, ruling or requirement issued, enacted, adopted, promulgated, implemented or otherwise put into effect by or under the authority of any governmental body, relating to (x) pollution, contamination, protection, remediation or reclamation of the environment, (y) emissions, discharges, disseminations, releases or threatened releases of hazardous substances into the air (indoor or outdoor), surface water, groundwater, soil, land surface or subsurface, buildings, facilities, real or personal property or fixtures or (z) the management, manufacture, processing, labeling, distribution, use, treatment, storage, disposal, transport, recycling or handling of hazardous substances.
" Equity Security " shall mean any stock or similar security of an issuer or any security (whether stock or Indebtedness for Borrowed Money) convertible, with or without consideration, into any stock or similar equity security, or any security (whether stock or Indebtedness for Borrowed Money) carrying any warrant or right to subscribe to or purchase any stock or similar security, or any such warrant or right.
" ERISA " shall have the meaning assigned to it in Section 2.12 hereof.
" Exchange Act " shall mean the Securities Exchange Act of 1934, as amended.
 
Exhibit 2.1 Merger Agreement -- Page 27

 
" Event of Default " shall mean (a) the failure of the Company or Parent, as applicable to pay any Indebtedness for Borrowed Money, or any interest or premium thereon, within five (5) days after the same shall become due, whether such Indebtedness shall become due by scheduled maturity, by required prepayment, by acceleration, by demand or otherwise, (b) an event of default under any agreement or instrument evidencing or securing or relating to any such Indebtedness, or (c) the failure of the Company or Parent to perform or observe any material term, covenant, agreement or condition on its part to be performed or observed under any agreement or instrument evidencing or securing or relating to any such Indebtedness when such term, covenant or agreement is required to be performed or observed.
" GAAP " shall have the meaning assigned to it in Section 2.9 hereof.
" Holdover Employees " shall mean the current employees of Parent listed on Schedule 6.2(f)(10) hereto, who may remain employed with the Parent after the closing until no later than February 20, 2018.
" Holdover Employee Amount " shall mean an amount of money necessary to cover all unpaid compensation and related taxes and benefits associated with the Holdover Employees.
" Indebtedness " shall mean any obligation of the Company or Parent, as applicable, which under generally accepted accounting principles is required to be shown on the balance sheet of the Company as a liability. Any obligation secured by a Lien on, or payable out of the proceeds of production from, property of the Company or Parent shall be deemed to be Indebtedness even though such obligation is not assumed by the Company.
" Indebtedness for Borrowed Money " shall mean (a) all Indebtedness in respect of money borrowed including, without limitation, Indebtedness which represents the unpaid amount of the purchase price of any property and is incurred in lieu of borrowing money or using available funds to pay such amounts and not constituting an account payable or expense accrual incurred or assumed in the ordinary course of business of the Company or Parent, as applicable, (b) all Indebtedness evidenced by a promissory note, bond or similar written obligation to pay money, or (c) all such Indebtedness guaranteed by the Company or Parent, as applicable, or for which the Company is otherwise contingently liable.
" Investment Company Act " shall mean the Investment Company Act of 1940, as amended.
" knowledge " and " know " means, when referring to any person or entity, the actual knowledge of such person or entity of a particular matter or fact, and what that person or entity would have reasonably known after due inquiry.  An entity will be deemed to have "knowledge" of a particular fact or other matter if any individual who is serving, or who has served, as an executive officer of such entity has actual "knowledge" of such fact or other matter, or had actual "knowledge" during the time of such service of such fact or other matter, or would have had "knowledge" of such particular fact or matter after due inquiry.
" Lien " shall mean any mortgage, pledge, security interest, encumbrance, lien or charge of any kind, including, without limitation, any conditional sale or other title retention agreement, any lease in the nature thereof and the filing of or agreement to give any financing statement under the Uniform Commercial Code of any jurisdiction and including any lien or charge arising by statute or other law.
 
Exhibit 2.1 Merger Agreement -- Page 28

 
" Memorandum " shall have the meaning assigned to it in the fourth recital hereof.
" Merger " shall have the meaning assigned to it in the first recital hereof.
" Merger Documents " shall have the meaning assigned to it in Section 2.5 hereof.
" Offering " shall have the meaning assigned to it in Section 6.1(i) hereof.
" Parent " shall mean WestMountain Company, a Colorado corporation.
" Parent Balance Sheet " and " Parent Balance Sheet Date " shall have the meanings assigned to them in Section 3.13 hereof.
" Parent Common Stock " shall have the meaning assigned to it in Section 3.4 hereof.
" Parent Preferred Stock " shall have the meaning assigned to it in Section 3.4 hereof.
" Parent Employee Benefit Plans " shall have the meaning assigned to it in Section 3.16 hereof.
" Parent Financial Statements " shall have the meaning assigned to it in Section 3.8 hereof.
" Parent SEC Documents " shall have the meaning assigned to it in Section 3.7(b) hereof.
" Parent Warrants " shall have the meaning assigned to it in Section 1.5(a)(v) hereof.
" Patent and Trademark Rights " shall have the meaning assigned to it in Section 2.15 hereof.
" Permitted Liens " shall mean (a) Liens for taxes and assessments or governmental charges or levies not at the time due or in respect of which the validity thereof shall currently be contested in good faith by appropriate proceedings; (b) Liens in respect of pledges or deposits under workmen's compensation laws or similar legislation, carriers', warehousemen's, mechanics', laborers' and similar Liens, if the obligations secured by such Liens are not then delinquent or are being contested in good faith by appropriate proceedings; and (c) Liens incidental to the conduct of the business of the Company that were not incurred in connection with the borrowing of money or the obtaining of advances or credits and which do not in the aggregate materially detract from the value of its property or materially impair the use made thereof by the Company in its business.
 
Exhibit 2.1 Merger Agreement -- Page 29

 
" Person " shall include all natural persons, corporations, business trusts, associations, limited liability companies, partnerships, joint ventures and other entities and governments and agencies and political subdivisions.
" Securities Act " shall mean the Securities Act of 1933, as amended.
" Stockholders " shall mean all of the stockholders of the Company.
" Subsidiaries " shall have the meaning assigned to it in Section 2.1(b) hereof.
" Surviving Corporation " shall have the meaning assigned to it in Section 1.1 hereof.
" Tax " or " Taxes " shall mean (a) any and all taxes, assessments, customs, duties, levies, fees, tariffs, imposts, deficiencies and other governmental charges of any kind whatsoever (including, but not limited to, taxes on or with respect to net or gross income, franchise, profits, gross receipts, capital, sales, use, ad valorem, value added, transfer, real property transfer, transfer gains, transfer taxes, inventory, capital stock, license, payroll, employment, social security, unemployment, severance, occupation, real or personal property, estimated taxes, rent, excise, occupancy, recordation, bulk transfer, intangibles, alternative minimum, doing business, withholding and stamp), together with any interest thereon, penalties, fines, damages costs, fees, additions to tax or additional amounts with respect thereto, imposed by the United States (federal, state or local) or other applicable jurisdiction; (b) any liability for the payment of any amounts described in clause (a) as a result of being a member of an affiliated, consolidated, combined, unitary or similar group or as a result of transferor or successor liability, including, without limitation, by reason of Regulation section 1.1502-6; and (c) any liability for the payments of any amounts as a result of being a party to any Tax Sharing Agreement or as a result of any express or implied obligation to indemnify any other Person with respect to the payment of any amounts of the type described in clause (a) or (b).
" Tax Return " shall include all returns and reports (including elections, declarations, disclosures, schedules, estimates and information returns (including Form 1099 and partnership returns filed on Form 1065) required to be supplied to a Tax authority relating to Taxes.
10.      Closing The closing of the Merger (the " Closing ") shall occur on or before March 31, 2018 (the " Closing Date ").  The Closing shall occur at the offices of Bart and Associates, LLC, or at a location mutually agreed upon by the Parties.  At the Closing, Parent shall present for delivery to each Stockholder the certificate representing the Parent Common Stock to be issued pursuant to Section 1.5(a)(ii) hereof to them pursuant to Sections 1.6 and 4 hereof.  Such presentment for delivery shall be against delivery to Parent and Acquisition Corp. of the certificates, agreements and other instruments referred to in Section 6.1 hereof, and the certificates representing all of the Common Stock issued and outstanding immediately prior to the Effective Time. Parent will deliver at such Closing to the Company the officers' certificate and opinion referred to in Section 6.2 hereof. All of the other documents, certificates and agreements referenced in Section 6 will also be executed as described therein. At the Effective Time, all actions to be taken at the Closing shall be deemed to be taken simultaneously.
 
Exhibit 2.1 Merger Agreement -- Page 30

 
11.            Termination Prior to Closing .
11.1             Termination of Agreement This Agreement may be terminated at any time prior to the Closing:
(a)            By the mutual written consent of the Company, Acquisition Corp. and Parent;
(b)            By the Company, if Parent or Acquisition Corp. (i) fails to perform in any material respect any of its agreements contained herein required to be performed by it on or prior to the Closing Date, (ii) materially breaches any of its representations, warranties or covenants contained herein, which failure or breach is not cured within thirty (30) days after the Company has notified Parent and Acquisition Corp. of its intent to terminate this Agreement pursuant to this paragraph (b);
(c)            By Parent and Acquisition Corp., if the Company (i) fails to perform in any material respect any of its agreements contained herein required to be performed by it on or prior to the Closing Date, (ii) materially breach any of its representations, warranties or covenants contained herein, which failure or breach is not cured within thirty (30) days after Parent or Acquisition Corp. has notified the Company of its intent to terminate this Agreement pursuant to this paragraph (c);
(d)            By either the Company, on the one hand, or Parent and Acquisition Corp., on the other hand, if there shall be any order, writ, injunction or decree of any court or governmental or regulatory agency binding on Parent, Acquisition Corp. or the Company, which prohibits or materially restrains any of them from consummating the transactions contemplated hereby; provided , that the parties hereto shall have used their best efforts to have any such order, writ, injunction or decree lifted and the same shall not have been lifted within ninety (90) days after entry, by any such court or governmental or regulatory agency;
(e)            By the Parent and Acquisition Corp., if they deem in their sole and complete discretion, that the final audited financials statements yet to be provided by the Company under Section 2.9 are materially different in any aspect from the unaudited financial statements which have previously been provided;
(f)            By the Parent and Acquisition Corp., if they deem in their sole and complete discretion, that any aspect of the Company's business or status is materially different from its situation as disclosed to the Parent and Acquisition Corp. by the Company as of August 30, 2017;
(i)            By either the Company, on the one hand, or Parent and Acquisition Corp., on the other hand, if the Closing has not occurred on or prior to February 20, 2018 for any reason other than delay or nonperformance of the party seeking such termination.
11.2            Termination of Obligations. Termination of this Agreement pursuant to this Section 11 shall terminate all obligations of the parties hereunder, except for the obligations under Section 6.1; provided , however , that termination pursuant to paragraphs (b) or (c) of Section 11.1 shall not relieve the defaulting or breaching party or parties from any liability to the other parties hereto.
 
Exhibit 2.1 Merger Agreement -- Page 31

 
12.            Miscellaneous .
12.1            Notices Any notice, request or other communication hereunder shall be given in writing and shall be served either personally by overnight delivery or delivered by mail, certified return receipt and addressed to the following addresses:
If to Parent
or Acquisition Corp.:          WestMountain Company
1001-A E. Harmony Road #366
Fort Collins, CO 80525
Attn: Brian Klemsz, CEO

With a copy to:
Bart and Associates, LLC
8400 East Prentice Avenue
Suite 1500
Greenwood Village, Colorado  80111
Attention:  Ken Bart, Esq.

If to the Company:  
CytoBioscience, Inc.
3463 Magic Drive, Suite 120
San Antonio, TX 78229
Attn: Dr. James Garvin, Ph.D., Chief Executive Officer

With a copy to:
Maynard, Cooper & Gale, P.C.
1901 Sixth Avenue North
2400 Regions/Harbert Plaza
Birmingham, Alabama  35203
Attention: Gregory S. Curran
Facsimile:(205) 254-1999

Notices shall be deemed received at the earlier of actual receipt or three (3) business days following mailing.  Counsel for a party (or any authorized representative) shall have authority to accept delivery of any notice on behalf of such party.
12.2            Entire Agreement.  This Agreement, including the schedules and exhibits attached hereto and other documents referred to herein, contains the entire understanding of the parties hereto with respect to the subject matter hereof.  This Agreement supersedes all prior agreements and undertakings between the parties with respect to such subject matter.
12.3      Expenses . Each party shall bear and pay all of the legal, accounting and other expenses incurred by it in connection with the transactions contemplated by this Agreement.
12.4      Time. Time is of the essence in the performance of the parties' respective obligations herein contained.
12.5             Severability. Any provision of this Agreement that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.
12.6            Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors, assigns and heirs.
12.7             No Third Parties Benefited. This Agreement is made and entered into for the sole protection and benefit of the parties hereto, their successors, assigns and heirs, and no other Person shall have any right or action under this Agreement.
12.8            Counterparts. This Agreement may be executed in one or more counterparts, with the same effect as if all parties had signed the same document. Each such counterpart shall be an original, but all such counterparts together shall constitute a single agreement.
12.9             Governing Law. This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of Colorado.  The parties to this Agreement agree that any breach of any term or condition of this Agreement or the transactions contemplated hereby shall be deemed to be a breach occurring in the State of Colorado by virtue of a failure to perform an act required to be performed in the State of Colorado.  The parties to this Agreement irrevocably and expressly agree to submit to the jurisdiction of the courts of the State of Colorado for the purpose of resolving any disputes among the parties relating to this Agreement or the transactions contemplated hereby.  The parties irrevocably waive, to the fullest extent permitted by law, any objection which they may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Agreement and the transactions contemplated hereby, or any judgment entered by any court in respect hereof brought in Denver, Colorado, and further irrevocably waive any claim that any suit, action or proceeding brought in Denver, Colorado has been brought in an inconvenient forum.  With respect to any action before the above courts, the parties hereto agree to service of process by certified or registered United States mail, postage prepaid, addressed to the party in question.

[SIGNATURE PAGE FOLLOWS]
 
Exhibit 2.1 Merger Agreement -- Page 32

 
IN WITNESS WHEREOF, the parties hereto have executed this Agreement to be binding and effective as of the day and year first above written.
 
PARENT:
WESTMOUNTAIN COMPANY
 
By: /s/ Brian Klemsz    
 
 
ACQUISITION CORP.:
WASM ACQUISITION CORP.
 
By: /s/ Brian Klemsz    
 
 
THE COMPANY:
CYTOBIOSCIENCE, INC.
 
By:   /s/ James R. Garvin    
James R. Garvin, Chief Executive Officer












 
 
 
 
 
Exhibit 2.1 Merger Agreement -- Page 33

Exhibit 10.1
 

Lock-Up Agreement

March 1, 2018
 
 
 
 
The undersigned hereby agrees that, without the prior written consent of Westmountain Company ("the Company"), the undersigned will not, during the period commencing on the date hereof and ending two years after the date hereof(the "Lock-Up Period "), (1) offer, pledge, sell, contract to sell, grant, lend, or otherwise transfer or dispose of, directly or indirectly, any of the Warrants, or the common shares underlying the Warrants held by the undersigned as of the date of this Agreement (the "Securities") or any other shares of common stock or securities convertible into or exercisable or exchangeable for shares of common stock held by the undersigned, whether now owned or hereafter acquired by the undersigned or with respect to which the undersigned has or hereafter acquires the power of disposition (collectively, with the Securities, the "Lock-Up Securities"); (2) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the Lock-Up Securities , whether any such transaction described in clause (1) or (2) above is to be settled by delivery of Lock-Up Securities, in cash or otherwise;; or (3) publicly disclose the intention to make any offer, sale, pledge or disposition, or to enter into any transaction, swap, hedge or other arrangement relating to any Lock-Up Securities. Notwithstanding the foregoing, and subject to the conditions below, the undersigned may transfer Lock-Up Securities without the prior written consent of the Company in connection with (a) transactions relating to Lock-Up Securities acquired in open market transactions; provided that no filing under Section 16(a) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), shall be required or shall be voluntarily made in connection with subsequent sales of Lock-Up Securities acquired in such open market transactions; (b) transfers of Lock-Up Securities as a bona fide gift, by will or intestacy or to a family member or trust for the benefit of a family member (for purposes of this lock-up agreement, "family member" means any relationship by blood, marriage or adoption, not more remote than first cousin); (c) transfers of Lock-Up Securities to a charity or educational institution or (d) if the undersigned is a corporation, partnership, limited liability company or other business entity, any transfers of Lock-Up Securities to any majority equity holder, officer, director, managing member or manager of the undersigned, as the case may be; provided that in the case of any transfer pursuant to the foregoing clauses (b), (c) or (d), (i) any such transfer shall not involve a disposition for value, (ii) each transferee shall sign and deliver to the Representative a lock-up agreement substantially in the form of this lock-up agreement, (iii) no filing under Section 16(a) of the Exchange Act shall be required or shall be voluntarily made, and (iv) the Securities are not transferred to a direct competitor of the Company. The undersigned also agrees and consents to the entry of stop transfer instructions with the Company's transfer agent and registrar against the transfer of the undersigned's Lock-Up Securities except in compliance with this lock-up agreement.

The undersigned agrees that, prior to engaging in any transaction or taking any other action that is subject to the terms of this lock-up agreement during the period from the date hereof to and through the expiration of the initial Lock-Up Period, the undersigned will give notice thereof to the Company and will not consummate any such transaction or take any such action unless it has received written confirmation from the Company that the Lock-Up Period has expired.

 

 
Exhibit 10.1 Lock-up Agreement -- Page 1




Notwithstanding the foregoing, the undersigned may offer, pledge, sell, contract to sell, grant, lend or otherwise transfer or dispose of up to Fifteen Percent (15%) of the Securities beginning August 16, 2018 and ending February 16, 2019, and Twenty Percent (20%) of the Securities beginning February 17, 2019and ending August 16, 2019, and Thirty Percent (30%) of the Securities beginning August 17, 2019 and ending February 16 , 2020. After February 17 tl•, 2020 the undersigned is free to offer, pledge, sell, contract to sell, grant, lend or otherwise transfer or dispose of remaining shares.

Aug 16, 2018-Feb 16, 2019
15%
Feb 17, 2019-Aug 16, 2019
20%
Aug 17, 2019-Feb 16, 2020
30%
Feb 17,2020
Free to sell

If the undersigned is an officer or director of the Company, (i) the undersigned agrees that the foregoing restriction s shall be equally applicable to any issuer-directed or " friends and family" Securities; and (ii) the undersigned agrees that, at least three (3) business days before the effective date of any release or waiver of the foregoing restrictions in connection with a transfer of Lock-Up Securities, the undersigned will notify the Company of the impending release or waiver. The provisions of this paragraph will not apply if (a) the release or waiver is effected solely to permit a transfer of Lock-Up Securities not for consideration and (b) the transferee has agreed in writing to be bound by the same terms described in this lock-up agreement to the extent and for the duration that such terms remain in effect at the time of such transfer.

No provision in this agreement shall be deemed to restrict or prohibit the exercise, exchange or conversion by the undersigned of any securities exercisable or exchangeable for or convertible into Securities, as applicable; provided that the undersigned does not transfer the Securities acquired on such exercise, exchange or conversion during the Lock-Up Period, unless otherwise permitted pursuant to the terms of this lock-up agreement. In addition, no provision herein shall be deemed to restrict or prohibit the entry into or modification of a so-called" I0b5- I" plan at any time (other than the entry into or modi fi cation of such a plan in such a manner as to cause the sale of any Lock-Up Securities within the Lock-Up Period).

The undersigned understands that this lock-up agreement is irrevocable and shall be binding upon the undersigned's heirs, legal representatives, successors and assigns.


 
Very truly yours,
   
   
 
(Name - Please Print)
   
   
 
(Signature)
   
   
 
(Title)
   
   
 
(Address)
 
 


Exhibit 10.1 Lock-up Agreement -- Page 2

Exhibit 10.2
 
 
SECURITIES PURCHASE AGREEMENT
THIS SECURITIES PURCHASE AGREEMENT (this " Agreement ") is made as of the 26th day of February, 2018 by and among CytoBioscience, Inc. , a Delaware corporation (the " Company "), and the purchasers identified on the signature page hereto (each a " Purchaser " and together the " Purchasers ").
RECITALS
WHEREAS , the Company desires to sell to the Purchasers, on a "best-efforts, all-or-none" basis, $1,500,000 of units (the " Offering Amount ") of the Company (each unit, including the components of such unit, a " Unit ," and collectively the " Units "), with each Unit consisting of (i) one (1) share (each, a " Share ", collectively, the " Shares ") of the Company's common stock, par value $0.0001 per share (the " Common Stock ") and (ii) a three (3) ‑year warrant to purchase one (1) share of Common Stock (each, a " Warrant ", collectively, the " Warrants ") for a purchase price of $0.75 per Unit (the " Offering ");
WHEREAS , the Company has engaged Divine Capital Markets LLC as sole placement agent for the Offering (the " Placement Agent ");
WHEREAS , immediately following the Closing (as defined in Section 1.1), the Company shall consummate the transactions contemplated by that certain Agreement of Merger and Plan of Reorganization substantially in the form attached hereto as Exhibit A (the " Merger Agreement ") by and among the Company, a Colorado corporation whose common stock is traded on the OTCPink as an "OTCPink Current" corporation, (" Parent ") and Pubco Acquisition Corp., a Colorado corporation, which is a wholly-owned subsidiary of Parent (" Acquisition Corp. "); and
WHEREAS , the Company and each Purchaser are executing and delivering this Agreement in reliance upon the exemption from registration afforded by Section 4(a)(2) of the Securities Act of 1933, as amended (the " Securities Act "), and Rule 506 of Regulation D (" Regulation D ") as promulgated by the United States Securities and Exchange Commission under the Securities Act.
NOW, THEREFORE , in consideration of the foregoing and the representations, warranties, covenants and conditions set forth below, the Company and each Purchaser, severally and not jointly, intending to be legally bound, hereby agree as follows:
1.           Purchase and Sale of Units.
1.1           The Offering; Offering Period . The purchase and sale of the Units by the Company to the Purchasers shall occur at one closing of the Offering (the " Closing " and the date of the Closing, the " Closing Date ") to occur during a period (the " Offering Period ") beginning on February 13, 2018 and ending immediately prior to the closing of the transactions contemplated by the Merger Agreement (the " Reverse Merger "). 
1.2           Closing . On the Closing Date, upon the terms and subject to the conditions set forth herein, the Company agrees to sell, and each Purchaser, severally and not jointly with the other Purchasers (as the case may be), agrees to purchase, the Units indicated on such Purchaser's signature page hereto.  Prior to the Closing Date, each Purchaser shall deliver to the Escrow Agent, via wire transfer or a certified check, in immediately available funds, such Purchaser's subscription amount as set forth on the signature page hereto (the " Subscription Amount "), and the Company shall deliver to each Purchaser its respective Units (or the components of such Units) as determined pursuant to Section 1.3(a) below, and the Company and each Purchaser shall deliver the other items set forth in Section 1.3 deliverable at the applicable Closing.  Upon satisfaction of the covenants and conditions set forth in Sections 1.3, 4 and 5, as applicable, the applicable Closing shall occur at the offices of Sichenzia Ross Ference Kesner LLP (" SRFK ") or such other location as the parties shall mutually agree, including remotely via the delivery of electronic Closing documents.

Exhibit 10.2 Securities Purchase Agreement -- Page 1




1.3           Deliveries .
(a)           On or prior to the Closing Date, the Company shall deliver or cause to be delivered to each Purchaser participating in the applicable Closing the following:

(i)           this Agreement duly executed by the Company;
(ii)           a certificate, or book entry records thereof, for such number of Shares equal to such Purchaser's Subscription Amount divided by the Purchase Price, registered in the name of such Purchaser; and
(iii)           a Warrant, or book entry records thereof, registered in the name of such Purchaser to purchase up to a number of Shares equal to 100% of the Shares purchased by such Purchaser.
(b)           On or prior to the Closing Date, each Purchaser participating in the applicable Closing shall deliver or cause to be delivered to the Company the following:
(i)           this Agreement duly executed by such Purchaser;
(ii)           an Accredited Investor Questionnaire (in the form provided by the Company to the Purchaser), duly executed by the Purchaser; and
(iii)           such Purchaser's Subscription Amount by wire transfer to the Escrow Agent.
1.4           The Reverse Merger .  Immediately following the Closing, the Company shall consummate the Reverse Merger, pursuant to which each Unit purchased herein shall, by virtue of the Reverse  Merger and without any action on the part of the holders thereof, be converted into the right to receive one share of common stock of the Parent (the " Parent Common Stock ") and a warrant to purchase one share of Parent Common Stock (the " Parent Warrants ").  The Parent Warrants shall be in the form attached hereto as Exhibit C.

1.5           Purchaser Acknowledgment .   Each Purchaser acknowledges and agrees that such Purchaser's Subscription Amount shall be held in a non-interest-bearing Escrow Account until such time as the Company and Placement Agent mutually agree to conduct the Closing. In the event that the Company does not conduct the Closing (whether because the Offering Amount was not raised or otherwise), each Purchaser acknowledges that such Purchaser will not receive any Units and will instead have returned its Subscription Amount without interest or deduction.  Each Purchaser acknowledges that the Placement Agent shall receive cash compensation consisting of $90,000 and warrants to purchase 160,000 shares of Parent Common Stock.  Further, each Purchaser acknowledges that the Placement Agent shall have the ability to invest a certain portion of the cash compensation payable to it with reference to its participation in the transactions covered hereunder (not to exceed $30,000.00) in the Common Stock of the Company.     
1.6           Defined Terms Used in this Agreement .  In addition to the terms defined above, the following terms used in this Agreement shall be construed to have the meanings set forth or referenced below.

(a)           " Affiliate " means, with respect to any specified Person, any other Person who, directly or indirectly, controls, is controlled by, or is under common control with such Person, including, without limitation, any general partner, managing member, officer or director of such Person or any venture capital fund now or hereafter existing that is controlled by one or more general partners or managing members of, or shares the same management company with, such Person.
(b)           " Bylaws " means the Company's Bylaws, as amended.
(c)           " Code " means the Internal Revenue Code of 1986, as amended.
Exhibit 10.2 Securities Purchase Agreement -- Page 2



(d)           " Company Intellectual Property " means all patents, patent applications, trademarks, trademark applications, service marks, service mark applications, tradenames, copyrights, trade secrets, domain names, mask works, information and proprietary rights and processes, similar or other intellectual property rights, subject matter of any of the foregoing, tangible embodiments of any of the foregoing, licenses in, to and under any of the foregoing, and any and all such cases that are owned or used by the Company in the conduct of the Company's business as now conducted and as presently proposed to be conducted.
(e)             " Escrow Agent " means JP Morgan Chase Bank, N.A.
(f)               " Material Adverse Effect " means a material adverse effect on the business, assets (including intangible assets), liabilities, financial condition, property, prospects   or results of operations of the Company.
(g)           " Person " means any individual, corporation, partnership, trust, limited liability company, association or other entity.
(h)           " Purchase Price " means $0.75 per Unit.
(i)             " Securities " means the Units, Shares, Warrants and Warrant Shares.
(j)           " Securities Act " means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
(k)           " Transaction Documents " means this Agreement and the Warrant.
(l)             " Warrant Shares " means the shares of Common Stock issuable upon exercise of the Warrants.
2.           Representations and Warranties of the Company . The Company hereby represents and warrants to each Purchaser that, except as set forth on the Disclosure Schedule attached as Exhibit B to this Agreement, which exceptions shall be deemed to be part of the representations and warranties made hereunder, the following representations are true and complete as of the date of the Closing, except as otherwise indicated.  The Disclosure Schedule shall be arranged in sections corresponding to the numbered and lettered sections and Sections contained in this Section 2, and the disclosures in any section or Section of the Disclosure Schedule shall qualify other sections and Sections in this Section 2 only to the extent it is readily apparent from a reading of the disclosure that such disclosure is applicable to such other sections and Sections. For purposes of these representations and warranties (other than those in Sections 2.2, 2.3, 2.4, 2.5(a), and 2.6), the term the "Company" shall include any subsidiaries of the Company, unless otherwise noted herein .

2.1           Organization, Good Standing, Corporate Power and Qualification . The Company is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware and has all requisite corporate power and authority to carry on its business as presently conducted and as proposed to be conducted.  The Company is duly qualified to transact business and is in good standing in each jurisdiction in which the failure to so qualify would have a Material Adverse Effect.

2.2           Capitalization . The authorized capital stock of the Company consists of 100,000,000 shares of Common Stock and 25,000,000] shares of Series A Preferred Stock. The Company has no authority to issue any other capital stock.  There are 9,508,540 shares of Common Stock and  [24,352,242] shares of Series A Preferred Stock issued and outstanding, and such shares are duly authorized, validly issued, fully paid and nonassessable.  Except as disclosed in Section 2.2 of the Disclosure Schedule, the Company has no outstanding warrants, stock options, rights or commitments to issue Common Stock or other securities of the Company, and there are no outstanding securities convertible or exercisable into or exchangeable for Common Stock or other securities of the Company. All of the issued and outstanding securities were issued in compliance with applicable federal and state securities laws.

Exhibit 10.2 Securities Purchase Agreement -- Page 3




2.3           Subsidiaries.   Except as set forth on Section 2.3 of the Disclosure Schedule, the Company does not currently own or control, directly or indirectly, any interest in any other corporation, partnership, trust, joint venture, limited liability company, association, or other business entity.  The Company is not a participant in any joint venture, partnership or similar arrangement.
2.4           Authorization. All corporate action required to be taken by the Company's Board of Directors and stockholders in order to authorize the Company to enter into the Agreement, and to issue the Units, the Shares and the Warrants at the Closing and to issue the Warrant Shares upon exercise of the Warrants in accordance with their terms and payment of the exercise price therefor has been taken or will be taken prior to the Closing.  All action on the part of the officers of the Company necessary for the execution and delivery of the Transaction Documents, the performance of all obligations of the Company under the Transaction Documents to be performed as of the Closing, and the issuance and delivery of the Shares and Warrants has been taken or will be taken prior to the Closing.  The Agreement, when executed and delivered by the Company, shall constitute valid and legally binding obligations of the Company, enforceable against the Company in accordance with their respective terms except (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance, or other laws of general application relating to or affecting the enforcement of creditors' rights generally, or (ii) as limited by laws relating to the availability of specific performance, injunctive relief, or other equitable remedies.
2.5           Valid Issuance of Securities; No Bad Actors .
(a)           The Units, Shares and Warrants, when issued, sold and delivered in accordance with the terms and for the consideration set forth in this Agreement, will be validly issued, fully paid and nonassessable and free of restrictions on transfer other than restrictions on transfer under the Agreement, applicable state and federal securities laws and liens or encumbrances created by or imposed by a Purchaser.  Assuming the accuracy of the representations of the Purchasers in Section 3 of this Agreement and subject to the filings described in Section 2.6(ii) below, the Units, Shares and Warrants will be issued in compliance with all applicable federal and state securities laws.  Based in part upon the representations of the Purchasers in Section 3 of this Agreement, and subject to Section 2.6 below, the Warrant Shares have been duly reserved for issuance, and upon issuance in accordance with the terms of the Warrants and payment of the exercise price therefor, will be validly issued, fully paid and nonassessable and free of restrictions on transfer other than restrictions on transfer under the Agreement, applicable federal and state securities laws and liens or encumbrances created by or imposed by a Purchaser.
(b)           None of the Company, any of its predecessors, any affiliated issuer, any director, executive officer, other officer of the Company participating in the Offering hereunder, or, to the Company's knowledge, any beneficial owner (as that term is defined in Rule 13d-3 under the Securities Exchange Act of 1934, as amended (the " Exchange Act ")) of 20% or more of the Company's outstanding voting equity securities, calculated on the basis of voting power, nor any promoter (as that term is defined in Rule 405 under the Securities Act) connected with the Company in any capacity at the time of sale (each, an " Issuer Covered Person " and, together, " Issuer Covered Persons ") is subject to any of the "Bad Actor" disqualifications described in Rule 506(d)(1)(i) to (viii) under the Securities Act (a " Disqualification Event "), except for a Disqualification Event covered by Rule 506(d)(2) or (d)(3). The Company has exercised reasonable care to determine whether any Issuer Covered Person is subject to a Disqualification Event .
2.6           Governmental Consents and Filings. Assuming the accuracy of the representations made by the Purchasers in Section 3 of this Agreement, no consent, approval, order or authorization of, or registration, qualification, designation, declaration or filing with, any federal, state or local governmental authority is required on the part of the Company in connection with the consummation of the transactions contemplated by this Agreement, except for filings pursuant to Regulation D and applicable state securities laws, which have been made or will be made in a timely manner.

Exhibit 10.2 Securities Purchase Agreement -- Page 4



2.7           Litigation . There is no claim, action, suit, proceeding, arbitration, complaint, charge or investigation pending or to the Company's knowledge, currently threatened (i) against the Company or any officer, or director of the Company arising out of their employment or board relationship with the Company; (ii) that questions the validity of the Transaction Documents or the right of the Company to enter into them, or to consummate the transactions contemplated by the Transaction Documents; or (iii) to the Company's knowledge, that would reasonably be expected to have, either individually or in the aggregate, a Material Adverse Effect.  Neither the Company nor, to the Company's knowledge, any of its officers, or directors is a party or is named as subject to the provisions of any order, writ, injunction, judgment or decree of any court or government agency or instrumentality (in the case of officers or directors, such as would affect the Company).  There is no action, suit, proceeding or investigation by the Company pending or which the Company intends to initiate.  The foregoing includes, without limitation, actions, suits, proceedings or investigations pending or threatened in writing (or any basis therefor known to the Company) involving the prior employment of any of the Company's employees, their services provided in connection with the Company's business, any information or techniques allegedly proprietary to any of their former employers or their obligations under any agreements with prior employers.
2.8           Intellectual Property . The Company owns or has the right to use all Intellectual Property (as hereinafter defined) necessary (a) to use, manufacture, market and distribute the products manufactured, marketed, sold or licensed, and to provide the services provided, by the Company to other parties (together, the " Customer Deliverables ") and (b) to operate the internal systems of the Company that are material to its business or operations, including, without limitation, computer hardware systems, software applications and embedded systems (the " Internal Systems ").  The Intellectual Property owned by or licensed to the Company and incorporated in or underlying the Customer Deliverables or the Internal Systems is referred to herein as the " the Company Intellectual Property ").  Each item of the Company Intellectual Property will be owned or available for use by the Company immediately following the Closing on substantially identical terms and conditions as it was immediately prior to the Closing.  The Company has taken all reasonable measures to protect the proprietary nature of each item of the Company Intellectual Property.  To the knowledge of the Company, (i) no other person or entity has any rights to any of the Company Intellectual Property owned by the Company except pursuant to agreements or licenses entered into by the Company and such person in the ordinary course, and (ii) no other person or entity is infringing, violating or misappropriating any of the Company Intellectual Property.  For purposes of this Agreement, " Intellectual Property " means all patents and patent applications, copyrights and registrations thereof, computer software, data and documentation, trade secrets and confidential business information, whether patentable or unpatentable and whether or not reduced to practice, know-how, manufacturing and production processes and techniques, research and development information, copyrightable works, financial, marketing and business data, pricing and cost information, business and marketing plans and customer and supplier lists and information, trademarks, service marks, trade names, domain names and applications and registrations therefor, and other proprietary rights relating to any of the foregoing.
2.9           Compliance with Other Instruments . The Company is not in violation or default, and the execution, delivery and performance of the Transaction Documents and the consummation of the transactions contemplated thereby will not cause a violation or default, (i) of any provisions of the Company's Certificate of Incorporation, as amended (the " Certificate of Incorporation "), or the Company's Bylaws, (ii) of any instrument, judgment, order, writ or decree, (iii) under any note, indenture or mortgage, (iv) under any lease, agreement, contract or purchase order to which it is a party or by which it is bound that is required to be listed on the Disclosure Schedule,   or (v) to the Company's knowledge, of any provision of federal or state statute, rule or regulation applicable to the Company, the violation of which would have a Material Adverse Effect.  The execution, delivery and performance of the Transaction Documents and the consummation of the transactions contemplated by the Transaction Documents will not result in any such violation or be in conflict with or constitute, with or without the passage of time and giving of notice, either (1) a default under any such provision, instrument, judgment, order, writ, decree, contract or agreement or (2) an event which results in the creation of any lien, charge or encumbrance upon any assets of the Company or the suspension, revocation, forfeiture, or nonrenewal of any material permit or license applicable to the Company.

Exhibit 10.2 Securities Purchase Agreement -- Page 5




2.10           Agreements; Actions; Solvency.

(a)           Except for the Transaction Documents and as disclosed on Section 2.10(a) of the Disclosure Schedules, there are no agreements, understandings, instruments, contracts or proposed transactions to which the Company is a party or by which it is bound that involve (i) obligations (contingent or otherwise) of, or payments to, the Company in excess of $100,000, (ii) the license of any patent, copyright, trademark, trade secret or other proprietary right to or from the Company, (iii) the grant of rights to manufacture, produce, assemble, license, market, or sell its products to any other Person that limit the Company's exclusive right to develop, manufacture, assemble, distribute, market or sell its products, or (iv) indemnification by the Company with respect to infringements of proprietary rights.
(b)           Except as disclosed on Section 2.10(b) of the Disclosure Schedules, the Company has not (i) declared or paid any dividends, or authorized or made any distribution upon or with respect to any class or series of its capital stock, (ii) incurred any indebtedness for money borrowed or incurred any other liabilities individually in excess of $10,000 or in excess of $25,000 in the aggregate, (iii) made any loans or advances to any Person, other than ordinary advances for travel expenses, or (iv) sold, exchanged or otherwise disposed of any of its assets or rights, other than the sale of its inventory in the ordinary course of business.  For the purposes of (b) and (c) of this Section 2.10 , all indebtedness, liabilities, agreements, understandings, instruments, contracts and proposed transactions involving the same Person (including Persons the Company has reason to believe are affiliated with each other) shall be aggregated for the purpose of meeting the individual minimum dollar amounts of such Section.
(c)           The Company is not a guarantor or indemnitor of any indebtedness of any other Person.
(d)           Based on the consolidated financial condition of the Company as of the applicable Closing Date, after giving effect to the receipt by the Company of the proceeds from the sale of the Units hereunder, (i) the fair saleable value of the Company's assets exceeds the amount that will be required to be paid on or in respect of the Company's existing debts and other liabilities (including known contingent liabilities) as they mature, (ii) the Company's assets do not constitute unreasonably small capital to carry on its business as now conducted and as proposed to be conducted including its capital needs taking into account the particular capital requirements of the business conducted by the Company, consolidated and projected capital requirements and capital availability thereof, and (iii) the current cash flow of the Company, together with the proceeds the Company would receive, were it to liquidate all of its assets, after taking into account all anticipated uses of the cash, would be sufficient to pay all amounts on or in respect of its liabilities when such amounts are required to be paid.  The Company does not intend to incur debts beyond its ability to pay such debts as they mature (taking into account the timing and amounts of cash to be payable on or in respect of its debt).  The Company has no knowledge of any facts or circumstances which lead it to believe that it will file for reorganization or liquidation under the bankruptcy or reorganization laws of any jurisdiction within one year from the Closing Date.
2.11           Certain Transactions .

(a)           Other than (i) standard employee benefits generally made available to all employees, (ii) standard director and officer indemnification agreements approved by the Board of Directors, (iii) the purchase of shares of the Company's capital stock and the issuance of options to purchase shares of the Company's Common Stock or (iv) as set forth in the Merger Agreement, in each instance, approved in the written minutes of the Board of Directors, there are no agreements, understandings or proposed transactions between the Company and any of its officers, directors, consultants or employees, or any Affiliate thereof.
Exhibit 10.2 Securities Purchase Agreement -- Page 6




(b)           The Company is not indebted, directly or indirectly, to any of its directors, officers or employees or to their respective spouses or children except as noted in 2.11, or to any Affiliate of any of the foregoing, other than in connection with expenses or advances of expenses incurred in the ordinary course of business or employee relocation expenses and for other customary employee benefits made generally available to all employees.  None of the Company's directors, officers or employees, or any members of their immediate families, or any Affiliate of the foregoing are, directly or indirectly, indebted to the Company or, to the Company's knowledge, have any (i) material commercial, industrial, banking, consulting, legal, accounting, charitable or familial relationship with any of the Company's customers, suppliers, service providers, joint venture partners, licensees and competitors, (ii) direct or indirect ownership interest in any firm or corporation with which the Company is affiliated or with which the Company has a business relationship, or any firm or corporation which competes with the Company except that directors, officers, employees or stockholders of the Company may own stock in (but not exceeding two percent (2%) of the outstanding capital stock of) publicly traded companies that may compete with the Company; or (iii) financial interest in any material contract with the Company.  The Company has the outstanding indebtedness to noteholders and lenders disclosed in Section 2.11(b) of the Disclosure Schedule.
2.12           Rights of Registration and Voting Rights . Except for the rights provided to the Purchasers pursuant to Section 6.1 hereto, the Company is not under any obligation to register under the Securities Act any of its currently outstanding securities or any securities issuable upon exercise or conversion of its currently outstanding securities.  To the Company's knowledge, no stockholder of the Company has entered into any agreements with respect to the voting of capital shares of the Company.
2.13           Property. Except as disclosed on Section 2.13 of the Disclosure Schedule, the property and assets that the Company owns are free and clear of all mortgages, deeds of trust, liens, loans and encumbrances, except for statutory liens for the payment of current taxes that are not yet delinquent and encumbrances and liens that arise in the ordinary course of business and do not materially impair the Company's ownership or use of such property or assets.  With respect to the property and assets it leases, the Company is in compliance with such leases and, to the Company's knowledge, holds a valid leasehold interest free of any liens, claims or encumbrances other than those of the lessors of such property or assets.  The Company does not own any real property.
2.14           Financial Statements .   Attached hereto as Section 2.14 of the Disclosure Schedules are the Company's audited Consolidated Balance Sheet, Consolidated Statement of Operations, Consolidated Statement of Changes in Shareholders' Equity and Consolidated Statement of Cash Flows as of and for the years ended December 31, 2016 and 2015, and the Company's unaudited Consolidated Balance Sheet (the " Balance Sheet ") as of September 30, 2017 (the " Balance Sheet Date ") and related Statement of Operations, Consolidated Statement of Changes in Shareholders' Equity and Consolidated Statement of Cash Flows as of and for the period ended September 30, 2017.  Such financial statements (i) are in accordance with the books and records of the Company, (ii) present fairly in all material respects the financial condition of the Company at the dates therein specified and the results of its operations and changes in financial position for the periods therein specified and (iii) have been prepared in accordance with generally accepted accounting principles (" GAAP ") applied on a basis consistent with prior accounting periods.
2.15           Changes.   Since the Balance Sheet Date, except as disclosed in Section 2.15 of the Disclosure Schedules, the Company has not (a) incurred any debts, obligations or liabilities, absolute, accrued, contingent or otherwise, whether due or to become due, except for fees, expenses and liabilities incurred in connection with the Merger and related transactions and current liabilities incurred in the usual and ordinary course of business, (b) discharged or satisfied any Liens other than those securing, or paid any obligation or liability other than, current liabilities shown on the Balance Sheet and current liabilities incurred since the Balance Sheet Date, in each case in the usual and ordinary course of business, (c) mortgaged, pledged or subjected to Lien any of its assets, tangible or intangible, other than in the usual and ordinary course of business, (d) sold, transferred or leased any of its assets, except in the usual and ordinary course of business, (e) cancelled or compromised any debt or claim, or waived or released any right, of material value, (f) suffered any physical damage, destruction or loss (whether or not covered by insurance) materially and adversely affecting the Condition of the Company, or (g) entered into any transaction other than in the usual and ordinary course of business.

Exhibit 10.2 Securities Purchase Agreement -- Page 7




2.16           Employee Matters .

(a)           To the Company's knowledge, none of its employees is obligated under any contract (including licenses, covenants or commitments of any nature) or other agreement, or subject to any judgment, decree or order of any court or administrative agency, that would materially interfere with such employee's ability to promote the interest of the Company or that would conflict with the Company's business.  Neither the execution or delivery of the Transaction Documents, nor the carrying on of the Company's business by the employees of the Company, nor the conduct of the Company's business as now conducted and as presently proposed to be conducted, will, to the Company's knowledge, conflict with or result in a breach of the terms, conditions, or provisions of, or constitute a default under, any contract, covenant or instrument under which any such employee is now obligated.
(b)           Except as disclosed in Section 2.16(b) of the Disclosure Schedules, (i) the Company is not delinquent in payments to any of its employees, consultants, or independent contractors for any wages, salaries, commissions, bonuses, or other direct compensation for any service performed for it to the date hereof or amounts required to be reimbursed to such employees, consultants or independent contractors; (ii) the Company has complied in all material respects with all applicable state and federal equal employment opportunity laws and with other laws related to employment, including those related to wages, hours, worker classification and collective bargaining And (iii)The Company has withheld and paid to the appropriate governmental entity or is holding for payment not yet due to such governmental entity all amounts required to be withheld from employees of the Company and is not liable for any arrears of wages, taxes, penalties or other sums for failure to comply with any of the foregoing.
(c)           To the Company's knowledge, no officer of the Company intends to terminate employment with the Company or is otherwise likely to become unavailable to continue as an officer of the Company, nor does the Company have a present intention to terminate employment of any of the foregoing. The employment of each employee of the Company is terminable at the will of the Company.  Except as set forth in Section 2.16(c) of the Disclosure Schedule or as required by law, upon termination of the employment of any such employees, no severance or other payments will become due.  Except as set forth in Section 2.16(c) of the Disclosure Schedule, the Company has no policy, practice, plan or program of paying severance pay or any form of severance compensation in connection with the termination of employment services.
(d)           The Company has not made any representations regarding equity incentives to any officer, employee, director or consultant that are inconsistent with the share amounts and terms set forth in the minutes of meetings of the Company's board of directors.
(e)           Each former employee whose employment was terminated by the Company has entered into an agreement with the Company providing for the full release of any claims against the Company or any related party arising out of such employment.
(f)           Except as disclosed on Section 2.16(f) of the Disclosure Schedule, the Company has no employment, consulting or similar agreement that obligates the Company to pay any person for services.

(g)           Section 2.16(g) of the   Disclosure Schedule sets forth each employee benefit plan maintained, established or sponsored by the Company, or which the Company participates in or contributes to, which is subject to the Employee Retirement Income Security Act of 1974, as amended (" ERISA ").  The Company has made all required contributions and has no liability to any such employee benefit plan, other than liability for health plan continuation coverage described in Part 6 of Title I(B) of ERISA,  and has complied in all material respects with all applicable laws for any such employee benefit plan.
Exhibit 10.2 Securities Purchase Agreement -- Page 8




2.17           Tax Returns and Payments . Except as disclosed on Section 2.17 of the Disclosure Schedule, (i) there are no federal, state, county, local or foreign taxes due and payable by the Company which have not been timely paid, (ii) there are no accrued and unpaid federal, state, country, local or foreign taxes of the Company which are due, whether or not assessed or disputed, (iii) there have been no examinations or audits of any tax returns or reports by any applicable federal, state, local or foreign governmental agency and (iv) the Company has duly and timely filed all federal, state, county, local and foreign tax returns required to have been filed by it and there are in effect no waivers of applicable statutes of limitations with respect to taxes for any year.
2.18           Insurance . The Company and its business and assets are insured by insurers of recognized financial responsibility against such losses and risks and in such amounts as are prudent and customary in the businesses in which the Company is engaged.
2.19            Reserved

2.20           Permits; FDA .

(a)           The Company has all franchises, permits, licenses and any similar authority necessary for the conduct of its business, the lack of which could reasonably be expected to have a Material Adverse Effect.  The Company is not in default in any material respect under any of such franchises, permits, licenses or other similar authority.
(b)           Without limiting the generality of Section 2.20(a) , as to each product candidate of the Company subject to the jurisdiction of the U.S. Food and Drug Administration (" FDA ") under the Federal Food, Drug and Cosmetic Act, as amended, and the regulations thereunder (" FDCA ") that is manufactured, transported or tested by or on behalf of the Company (each such product candidate, a " Pharmaceutical Product ") such Pharmaceutical Product is being manufactured, transported or tested by the Company in compliance with all applicable requirements under FDCA and similar laws, rules and regulations relating to registration, investigational use, premarket clearance, licensure, or application approval, good manufacturing practices, good laboratory practices, good clinical practices, product listing, quotas, labeling, advertising, record keeping and filing of reports, except where the failure to be in compliance would not reasonably be expected to have a Material Adverse Effect.  There is no pending, completed or, to the Company's knowledge, threatened, action (including any lawsuit, arbitration, or legal or administrative or regulatory proceeding, charge, complaint, or investigation) against the Company, and the Company has not received any notice, warning letter or other communication from the FDA or any other governmental entity, which (i) contests the ability of the Company to conduct any of its present or contemplated activities with respect to any Pharmaceutical Product, (ii) withdraws its authorization for any Pharmaceutical Product, (iii) imposes a clinical hold on any clinical investigation by the Company, (iv) enjoins production at any facility of the Company, (v) enters or proposes to enter into a consent decree of permanent injunction with the Company, or (vi) otherwise alleges any violation of any laws, rules or regulations by the Company, and which, either individually or in the aggregate, would reasonably be expected to have a Material Adverse Effect.  The properties, business and operations of the Company have been and are being conducted in all material respects in accordance with all applicable laws, rules and regulations of the FDA.
2.21           Corporate Documents .  The Certificate of Incorporation and Bylaws of the Company are in the form provided to the Purchasers.  The copy of the minute books of the Company contains minutes of all meetings of directors and stockholders and all actions by written consent without a meeting by the directors and stockholders since the date of incorporation and accurately reflects in all material respects all actions by the directors (and any committee of directors) and stockholders with respect to all transactions referred to in such minutes.
2.22           Disclosure. No representation or warranty of the Company contained in this Agreement, as qualified by the Disclosure Schedule, and no certificate furnished or to be furnished to Purchasers at the Closing contains any untrue statement of a material fact or, to the Company's knowledge, omits to state a material fact necessary in order to make the statements contained herein or therein not misleading in light of the circumstances under which they were made.

Exhibit 10.2 Securities Purchase Agreement -- Page 9



2.23           Real Property Holding Corporation. The Company is not now and has never been a "United States real property holding corporation" as defined in the Code and any applicable regulations promulgated thereunder.  The Company has filed with the Internal Revenue Service all statements, if any, with its United States income tax returns which are required under s uch regulations.
2.24           Environmental and Safety Laws. Except as could not reasonably be expected to have a Material Adverse Effect to the best of the Company's knowledge (a) the Company is and has been in compliance with all Environmental Laws; (b) there has been no release or to the Company's knowledge threatened release of any pollutant, contaminant or toxic or hazardous material, substance or waste or petroleum or any fraction thereof (each a " Hazardous Substance "), on, upon, into or from any site currently or heretofore owned, leased or otherwise used by the Company; (c) there have been no Hazardous Substances generated by the Company that have been disposed of or come to rest at any site that has been included in any published U.S. federal, state or local "superfund" site list or any other similar list of hazardous or toxic waste sites published by any governmental authority in the United States; and (d) there are no underground storage tanks located on, no polychlorinated biphenyls (" PCBs ") or PCB-containing equipment used or stored on, and no hazardous waste as defined by the Resource Conservation and Recovery Act, as amended, stored on, any site owned or operated by the Company, except for the storage of hazardous waste in compliance with Environmental Laws.  The Company has made available to the Purchasers true and complete copies of all material environmental records, reports, notifications, certificates of need, permits, pending permit applications, correspondence, engineering studies and environmental studies or assessments.  For purposes of this Section 2.24. " Environmental Laws " means any law, regulation, or other applicable requirement relating to (a) releases or threatened release of Hazardous Substance; (b) pollution or protection of employee health or safety, public health or the environment; or (c) the manufacture, handling, transport, use, treatment, storage, or disposal of Hazardous Substances.
2.25           Anti-Bribery and Anti-Corruption.   The Company represents and warrants that neither it, nor any of its directors, officers, agents, stockholders or employees acting on behalf of the Company, has taken any action that will cause the Purchaser or their affiliates to be in breach of any applicable laws for the prevention of fraud, bribery, corruption, racketeering, money laundering or terrorism, including but not limited to the U.S. Foreign Corrupt Practices Act, as amended, the Canadian Corruption of Foreign Officials Act, as amended, and the U.K. Bribery Act 2010 (" Anti-Corruption Laws "). The Company agrees that it has not, and covenants that it will not, in connection with the conduct of its business activities, promise, authorize, ratify or offer to make, or take any act in furtherance of any payment, contribution, gift, reimbursement or other transfer of anything of value, or any solicitation, directly or indirectly: (i) to any individual including government officials; or (ii) to an intermediary for payment to any individual including government officials; or (iii) to any political party for the purpose or effect of public or commercial bribery, acceptance of or acquiescence in extortion, kickbacks or other unlawful, illegal or improper means.  The Company has not, nor to the knowledge of the Company, have any of the Company's directors, officers, agents, stockholders or employees acting on behalf of the company established or maintained any unrecorded fund or asset for any purpose, or has made any false or artificial entries on any of its books or records for any reason.
2.26           Investment Company Act. The Company is not, and after the receipt and application of the proceeds of the financing contemplated by this Agreement will not be, an "investment company" as defined in the Investment Company Act of 1940, as amended.
2.27           Acknowledgment Regarding Purchasers' Purchase of Units.   The Company acknowledges and agrees that each of the Purchasers is acting solely in the capacity of an arm's length purchaser with respect to the Transaction Documents and the transactions contemplated thereby.  The Company further acknowledges that no Purchaser is acting as a financial advisor or fiduciary of the Company (or in any similar capacity) with respect to the Transaction Documents and the transactions contemplated thereby and any advice given by any Purchaser or any of their respective representatives or agents in connection with the Transaction Documents and the transactions contemplated thereby is merely incidental to the Purchasers' purchase of the Securities.  The Company further represents to each Purchaser that the Company's decision to enter into this Agreement and the other Transaction Documents has been based solely on the independent evaluation of the transactions contemplated hereby by the Company and its representatives.

Exhibit 10.2 Securities Purchase Agreement -- Page 10



2.28           Private Placement. Assuming the accuracy of the Purchasers' representations and warranties set forth in Section 3 , no registration under the Securities Act is required for the offer and sale of the Units by the Company to the Purchasers as contemplated hereby.
2.29           No Integrated Offering. Assuming the accuracy of the Purchasers' representations and warranties set forth in Section 3 , neither the Company, nor any of its Affiliates, nor any Person acting on its or their behalf has, directly or indirectly, made any offers or sales of any security or solicited any offers to buy any security, under circumstances that would cause this offering of the Units to be integrated with prior offerings by the Company for purposes of the Securities Act which would require the registration of any such securities under the Securities Act.
2.30           Foreign Corrupt Practices.   Neither the Company nor to the Knowledge of the Company, any agent or other person acting on behalf of the Company, has (i) directly or indirectly, used any funds for unlawful contributions, gifts, entertainment or other unlawful expenses related to foreign or domestic political activity, (ii) made any unlawful payment to foreign or domestic government officials or employees or to any foreign or domestic political parties or campaigns from corporate funds, (iii) failed to disclose fully any contribution made by the Company (or made by any person acting on its behalf of which the Company is aware) which is in violation of law, or (iv) violated in any material respect any provision of the Foreign Corrupt Practices Act of 1977, as amended.
2.31           No Disagreements with Accountants and Lawyers. There are no disagreements of any kind presently existing, or reasonably anticipated by the Company to arise, between the Company and the accountants and lawyers formerly or presently employed by the Company and the Company is current with respect to any fees owed to its accountants and lawyers which could affect the Company's ability to perform any of its obligations under any of the Transaction Documents.

3.           Representations and Warranties of the Purchasers .

Each Purchaser hereby represents and warrants to the Company, severally and not jointly, that:

3.1           Authorization . The Purchaser has full power and authority to enter into this Agreement.  This Agreement, when executed and delivered by the Purchaser, will constitute valid and legally binding obligations of the Purchaser, enforceable in accordance with its terms, except as limited by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance and any other laws of general application affecting enforcement of creditors' rights generally, and as limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies.
3.2           Purchase Entirely for Own Account . This Agreement is made with the Purchaser in reliance upon the Purchaser's representation to the Company, which by the Purchaser's execution of this Agreement, the Purchaser hereby confirms, that the Units to be acquired by the Purchaser will be acquired for investment for the Purchaser's own account, not as a nominee or agent, and not with a view to the resale or distribution of any part thereof, and that the Purchaser has no present intention of selling, granting any participation in, or otherwise distributing the same.  By executing this Agreement, the Purchaser further represents that the Purchaser does not presently 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 of the Units.  The Purchaser has not been formed for the specific purpose of acquiring the Units.
3.3           Disclosure of Information . The Purchaser has had an opportunity to discuss the Company's business, management, financial affairs and the terms and conditions of the offering of the Units with the Company's management and has had an opportunity to review the Company's facilities.  The foregoing, however, does not limit or modify the representations and warranties of the Company in Section 2 of this Agreement or the right of the Purchasers to rely thereon.

Exhibit 10.2 Securities Purchase Agreement -- Page 11



3.4           Restricted Securities . The Purchaser understands that the Units (including the components thereof) have not been registered under the Securities Act, by reason of a specific exemption from the registration provisions of the Securities Act which depends upon, among other things, the bona fide nature of the investment intent and the accuracy of the Purchaser's representations as expressed herein.  The Purchaser understands that the Units (including the components thereof) are "restricted securities" under applicable U.S. federal and state securities laws and that, pursuant to these laws, the Purchaser must hold the   Units (including the components thereof) indefinitely unless they are registered with the Securities and Exchange Commission and qualified by state authorities, or an exemption from such registration and qualification requirements is available.  The Purchaser acknowledges that if an exemption from registration or qualification is available, it may be conditioned on various requirements including, but not limited to, the time and manner of sale, the holding period for the Units (including the components thereof), and on requirements relating to the Company which are outside of the Purchaser's control, and which the Company is under no obligation   a nd may not be able to satisfy.
3.5           Information Provided by Placement Agent . The Purchaser acknowledges and agrees that neither the Placement Agent nor any Affiliate of the Placement Agent has provided such Purchaser with any information or advice with respect to the Securities nor is such information or advice necessary or desired.  Neither the Placement Agent nor any Affiliate has made or makes any representation as to the Company or the Parent or the quality of the Securities, Parent Common Stock and Parent Warrants and the Placement Agent and any Affiliate may have acquired non-public information with respect to the Company and Parent which such Purchaser agrees need not be provided to it.  In connection with the issuance of the Securities to such Purchaser, neither the Placement Agent nor any of its Affiliates has acted as a financial advisor or fiduciary to such Purchaser.
3.6           Legends . The Purchaser understands that the Securities and any securities issued in respect of or exchange for the Securities, may be notated with one or all of the following legends:

(a)           "THE SHARES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AND HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF. NO SUCH TRANSFER MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL IN A FORM SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED UNDER THE SECURITIES ACT OF 1933."
(b)           Any legend set forth in, or required by, the other Transaction Documents.
(c)           Any legend required by the securities laws of any state to the extent such laws are applicable to the Securities represented by the certificate, instrument, or book entry so legended.

3.7           Accredited Investor . The Purchaser is an accredited investor as defined in Rule 501(a) of Regulation D.
3.8           No General Solicitation . Neither the Purchaser, nor to its knowledge, any of its officers, directors, employees, agents, stockholders or partners has either directly or indirectly, including, through a broker or finder (a) engaged in any general solicitation, or (b) published any advertisement in connection with the offer and sale of the Units.
3.9           Exculpation Among Purchasers . The Purchaser acknowledges that it is not relying upon any Person, other than the Company and its officers and directors, in making its investment or decision to invest in the Company. The Purchaser agrees that neither any Purchaser nor the respective controlling Persons, officers, directors, partners, agents, or employees of any Purchaser shall be liable to any other Purchaser for any action heretofore taken or omitted to be taken by any of them in connection with the purchase of the Units.

Exhibit 10.2 Securities Purchase Agreement -- Page 12



3.10           Residence. If the Purchaser is an individual, then the Purchaser resides in the state or province identified in the address of the Purchaser set forth on such Purchaser's signature page; if the Purchaser is a partnership, corporation, limited liability company or other entity, then the office or offices of the Purchaser in which its principal place of business is identified in the address or addresses of the Purchaser set forth on such Purchaser's signature page.

4.           Conditions to the Purchasers' Obligations at Closing . The obligations of each Purchaser to purchase Units at the Closing are subject to the fulfillment, on or before the Closing, of each of the following conditions, unless otherwise waived:
4.1           Representations and Warranties. The representations and warranties of the Company contained in Section 2   shall be true and correct in all respects as of the Closing.

4.2           Performance . The Company shall have performed and complied with all covenants, agreements, obligations and conditions contained in this Agreement that are required to be performed or complied with by the Company on or before the Closing.
4.3           Qualifications . All authorizations, approvals or permits, if any, of any governmental authority or regulatory body of the United States or of any state that are required in connection with the lawful issuance and sale of the Securities pursuant to this Agreement shall be obtained and effective as of the Closing.
4.4           Proceedings and Documents. All corporate and other proceedings in connection with the transactions contemplated at the Closing and all documents incident thereto shall be reasonably satisfactory in form and substance to each Purchaser, and each Purchaser (or its counsel) shall have received all such counterpart original and certified or other copies of such documents as reasonably requested.   Such documents may include good standing certificates .
4.5           Merger Agreement. The Company shall have delivered to Placement Agent a fully executed copy of the Merger Agreement, executed by the Company, Parent, and Acquisition Corp.
4.6           Financial Statements. The Company shall have delivered to Placement Agent its audited financial statements for the years ended December 31, 2016 and 2015, as well as unaudited, reviewed financial statements for the nine month period ended September 30, 2017.

5.           Conditions of the Company's Obligations at Closing. The obligations of the Company to sell Units to any Purchaser at the Closing are subject to the fulfillment, on or before the Closing, of each of the following conditions, unless otherwise waived:

5.1           Representations and Warranties. The representations and warranties of such Purchaser contained in Section 3 shall be true and correct in all respects as of the Closing.
5.2           Performance. The Purchaser shall have performed and complied with all covenants, agreements, obligations and conditions contained in this Agreement that are required to be performed or complied with by such Purchaser on or before the Closing.
5.3           Qualifications. All authorizations, approvals or permits, if any, of any governmental authority or regulatory body of the United States or of any State that are required in connection with the lawful issuance and sale of the Units pursuant to this Agreement shall be obtained and effective as of the Closing.

6.           Other Agreements of the Parties .

  6.1.           Reverse Merger . The Company shall consummate the Reverse Merger on or before March 8, 2018.  

Exhibit 10.2 Securities Purchase Agreement -- Page 13




6.2           Registration Rights .  The Company shall cause the Parent to file a registration statement on Form S-1 with the SEC (the " Registration Statement ") to register the resale by the Purchasers of all shares of Parent Common Stock issued to the Purchasers in the Reverse Merger and shares of Parent Common Stock underlying the Parent Warrants issued to the Purchasers in the Reverse Merger within 90 days of the Closing and to cause such Registration Statement to become effective within 180 days of the Closing.  

6.3           Indemnification of Purchasers.   The Company will indemnify and hold each Purchaser and its directors, officers, shareholders, members, partners, employees and agents (and any other Persons with a functionally equivalent role of a Person holding such titles notwithstanding a lack of such title or any other title), each Person who controls such Purchaser (within the meaning of Section 15 of the Securities Act and Section 20 of the Exchange Act), and the directors, officers, shareholders, agents, members, partners or employees (and any other Persons with a functionally equivalent role of a Person holding such titles notwithstanding a lack of such title or any other title) of such controlling persons (each, a " Purchaser Party ") harmless from any and all losses, liabilities, obligations, claims, contingencies, damages, costs and expenses, including all judgments, amounts paid in settlements, court costs and reasonable attorneys' fees and costs of investigation that any such Purchaser Party may suffer or incur as a result of or relating to (a) any breach of any of the representations, warranties, covenants or agreements made by the Company in this Agreement or in the other Transaction Documents or (b) any action instituted against the Purchaser Parties in any capacity, or any of them or their respective Affiliates, by any stockholder of the Company who is not an Affiliate of such Purchaser Party, with respect to any of the transactions contemplated by the Transaction Documents (unless such action is based upon a breach of such Purchaser Party's representations, warranties or covenants under the Transaction Documents or any agreements or understandings such Purchaser Party may have with any such stockholder or any violations by such Purchaser Party of state or federal securities laws or any conduct by such Purchaser Party which constitutes fraud, gross negligence, willful misconduct or malfeasance).  If any action shall be brought against any Purchaser Party in respect of which indemnity may be sought pursuant to this Agreement, such Purchaser Party shall promptly notify the Company in writing, and the Company shall have the right to assume the defense thereof with counsel of its own choosing reasonably acceptable to the Purchaser Party.  Any Purchaser Party shall have the right to employ separate counsel in any such action and participate in the defense thereof, but the fees and expenses of such counsel shall be at the expense of such Purchaser Party except to the extent that (i) the employment thereof has been specifically authorized by the Company in writing, (ii) the Company has failed after a reasonable period of time to assume such defense and to employ counsel or (iii) in such action there is, in the reasonable opinion of counsel, a material conflict on any material issue between the position of the Company and the position of such Purchaser Party, in which case the Company shall be responsible for the reasonable fees and expenses of no more than one such separate counsel.  The Company will not be liable to any Purchaser Party under this Agreement (y) for any settlement by a Purchaser Party effected without the Company's prior written consent, which shall not be unreasonably withheld or delayed; or (z) to the extent, but only to the extent that a loss, claim, damage or liability is attributable to any Purchaser Party's breach of any of the representations, warranties, covenants or agreements made by such Purchaser Party in this Agreement or in the other Transaction Documents. The indemnification required by this Section 6.3 shall be made by periodic payments of the amount thereof during the course of the investigation or defense, as and when bills are received or are incurred, subject to recoupment if the Purchaser Party is found to not be entitled to indemnification for such amount(s). The indemnity agreements contained herein shall be in addition to any cause of action or similar right of any Purchaser Party against the Company or others and any liabilities the Company may be subject to pursuant to law.
6.4           Reservation of Preferred Stock and Common Stock.   The Company has reserved and will keep available at all times, free of preemptive rights, a sufficient number of shares of Preferred Stock and Common Stock for the purpose of enabling the Company to issue Securities pursuant to this Agreement and the Warrant.
6.5           Blue Sky Filings. The Company shall take such action as the Company shall reasonably determine is necessary in order to obtain an exemption for, or to qualify the Units for, sale to the Purchasers at the applicable Closing under applicable securities or "Blue Sky" laws of the states of the United States, and shall provide evidence of such actions promptly upon request of any Purchaser.

Exhibit 10.2 Securities Purchase Agreement -- Page 14



6.6           No Third Party Beneficiaries. The Placement Agent shall be the third party beneficiary of the representations and warranties of the Company in Section 2 and the representations and warranties of the Purchasers in Section 3. This Agreement is intended for the benefit of the parties hereto and their respective successors and permitted assigns and is not for the benefit of, nor may any provision hereof be enforced by, any other Person, except as otherwise set forth in this Section 6.6.

7.           Miscellaneous .

7.1           Termination. This Agreement may be terminated by any Purchaser, as to such Purchaser's obligations hereunder only and without any effect whatsoever on the obligations between the Company and the other Purchasers, by written notice to the other parties, if the Closing has not been consummated on or before the termination of the Offering Period; provided, however, that no such termination will affect the right of any party to sue for any breach by any other party (or parties).  Notwithstanding anything else herein to the contrary, the Purchaser may terminate this Agreement if the Reverse Merger has not been consummated on or before January 31, 2018.
7.2           Survival of Warranties.   Unless otherwise set forth in this Agreement, the representations and warranties of the Company and the Purchasers contained in or made pursuant to this Agreement shall survive the applicable Closing Date for one (1) year, except (i) as to any matter as to which a good faith claim has been submitted in writing to the other party describing the claim in reasonable detail before such date, (ii) as to any matter which is based successfully upon fraud with respect to which the cause of action shall expire only upon expiration of the applicable statute of limitations, and (iii) those representations and warranties set forth in Section 2.17 (Tax Returns and Payments), which shall survive until the expiration of the applicable statute of limitations.
7.3           Successors and Assigns.   The terms and conditions of this Agreement shall inure to the benefit of and be binding upon the respective successors and assigns of the parties.  Nothing in this Agreement, express or implied, is intended to confer upon any party other than the parties hereto or their respective successors and assigns any rights, remedies, obligations or liabilities under or by reason of this Agreement, except as expressly provided in this Agreement.
7.4           Governing Law.   This Agreement shall be governed by the internal law of the State of New York.
7.5           Counterparts. This Agreement may be executed in two (2) or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.  Counterparts may be delivered via facsimile, electronic mail (including pdf or any electronic signature complying with the U.S. federal ESIGN Act of 2000, e.g. , www.docusign.com) or other transmission method and any counterpart so delivered shall be deemed to have been duly and validly delivered and be valid and effective for all purposes.
7.6           Titles and Subtitles. The titles and subtitles used in this Agreement are used for convenience only and are not to be considered in construing or interpreting this Agreement.
7.7           Notices.   All notices and other communications given or made pursuant to this Agreement shall be in writing and shall be deemed effectively given upon the earlier of actual receipt, or (a) personal delivery to the party to be notified, (b) when sent, if sent by electronic mail or facsimile during normal business hours of the recipient, and if not sent during normal business hours, then on the recipient's next business day, (c) five (5) days after having been sent by registered or certified mail, return receipt requested, postage prepaid, or (d) one (1) business day after deposit with a nationally recognized overnight courier, freight prepaid, specifying next business day delivery, with written verification of receipt.  All communications shall be sent to the respective parties at their address as set forth on the signature page or Exhibit A, or to such e-mail address, facsimile number or address as subsequently modified by written notice given in accordance with this Section 7.7. 

Exhibit 10.2 Securities Purchase Agreement -- Page 15



7.8           No Finder's Fees. Each party represents that it neither is nor will be obligated for any finder's fee or commission in connection with this transaction except as set forth in Section 7.8 of the Disclosure Schedules.  Each Purchaser agrees to indemnify and to hold harmless the Company from any liability for any commission or compensation in the nature of a finder's or broker's fee arising out of this transaction (and the costs and expenses of defending against such liability or asserted liability) for which each Purchaser or any of its officers, employees or representatives is responsible.  The Company agrees to indemnify and hold harmless each Purchaser from any liability for any commission or compensation in the nature of a finder's or broker's fee arising out of this transaction (and the costs and expenses of defending against such liability or asserted liability) for which the Company or any of its officers, employees or representatives is responsible.
7.9           Attorneys' Fees. If any action at law or in equity (including, arbitration) is necessary to enforce or interpret the terms of any of the Transaction Documents, the prevailing party shall be entitled to reasonable attorneys' fees, costs and necessary disbursements in addition to any other relief to wh ich such party may be entitled.
7.10           Amendments and Waivers. Any term of this Agreement may be amended, terminated or waived only with the written consent of the Company and the holders of at least a majority of the then-outstanding Securities, or for an amendment, termination or waiver effected prior to the Closing, Purchasers obligated to purchase a majority of the Units to be issued at the Closing.  Any amendment or waiver effected in accordance with this Section 7.10 shall be binding upon the Purchasers and each transferee of the Securities, each future holder of all such Securities, and the Company.
7.11           Severability. The invalidity or unenforceability of any provision hereof shall in no way affect the validity or enforceability of any other provision.
7.12           Delays or Omissions. No delay or omission to exercise any right, power or remedy accruing to any party under this Agreement, upon any breach or default of any other party under this Agreement, shall impair any such right, power or remedy of such non-breaching or non-defaulting party nor shall it be construed to be a waiver of any such breach or default, or an acquiescence therein, or of or in any similar breach or default thereafter occurring; nor shall any waiver of any single breach or default be deemed a waiver of any other breach or default theretofore or thereafter occurring.  Any waiver, permit, consent or approval of any kind or character on the part of any party of any breach or default under this Agreement, or any waiver on the part of any party of any provisions or conditions of this Agreement, must be in writing and shall be effective only to the extent specifically set forth in such writing.  All remedies, either under this Agreement or by law or otherwise afforded to any party, shall be cumulative and not alternative.
7.13           Entire Agreement. This Agreement (including the Exhibits hereto), and the other Transaction Documents constitute the full and entire understanding and agreement between the parties with respect to the subject matter hereof, and any other written or oral agreement relating to the subject matter hereof existing between the parties are expressly canceled.
7.14           Dispute Resolution. The parties (a) hereby irrevocably and unconditionally submit to the jurisdiction of the state courts of New York and to the jurisdiction of the United States District Court for the Southern District of New York for the purpose of any suit, action or other proceeding arising out of or based upon this Agreement, (b) agree not to commence any suit, action or other proceeding arising out of or based upon this Agreement except in the state courts of New York   or the United States District Court for the Southern District of New York, and (c) hereby waive, and agree not to assert, by way of motion, as a defense, or otherwise, in any such suit, action or proceeding, any claim that it is not subject personally to the jurisdiction of the above-named courts, that its property is exempt or immune from attachment or execution, that the suit, action or proceeding is brought in an inconvenient forum, that the venue of the suit, action or proceeding is improper or that this Agreement or the subject matter hereof may not be enforced in or by such court.

Exhibit 10.2 Securities Purchase Agreement -- Page 16



7.15           WAIVER OF JURY TRIAL . EACH PARTY HEREBY WAIVES ITS RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT, THE OTHER TRANSACTION DOCUMENTS, THE SECURITIES OR THE SUBJECT MATTER HEREOF OR THEREOF.  THE SCOPE OF THIS WAIVER IS INTENDED TO BE ALL-ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE FILED IN ANY COURT AND THAT RELATE TO THE SUBJECT MATTER OF THIS TRANSACTION, INCLUDING, WITHOUT LIMITATION, CONTRACT CLAIMS, TORT CLAIMS (INCLUDING NEGLIGENCE), BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW AND STATUTORY CLAIMS.  THIS SECTION HAS BEEN FULLY DISCUSSED BY EACH OF THE PARTIES HERETO AND THESE PROVISIONS WILL NOT BE SUBJECT TO ANY EXCEPTIONS.  EACH PARTY HERETO HEREBY FURTHER WARRANTS AND REPRESENTS THAT SUCH PARTY HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL, AND THAT SUCH PARTY KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. Each party will bear its own costs in respect of any disputes arising under this Agreement. Each of the parties to this Agreement consents to personal jurisdiction for any equitable action sought in the U.S. District Court for the Northern District of California or any court of the Commonwealth of Massachusetts having subject matter jurisdiction.
7.16           No Commitment for Additional Financing. The Company acknowledges and agrees that no Purchaser has made any representation, undertaking, commitment or agreement to provide or assist the Company in obtaining any financing, investment or other assistance, other than the purchase of the Units as set forth herein and subject to the conditions set forth herein.  In addition, the Company acknowledges and agrees that (i) no statements, whether written or oral, made by any Purchaser or its representatives on or after the date of this Agreement shall create an obligation, commitment or agreement to provide or assist the Company in obtaining any financing or investment, (ii) the Company shall not rely on any such statement by any Purchaser or its representatives, and (iii) an obligation, commitment or agreement to provide or assist the Company in obtaining any financing or investment may only be created by a written agreement, signed by such Purchaser and the Company, setting forth the terms and conditions of such financing or investment and stating that the parties intend for such writing to be a binding obligation or agreement.  Each Purchaser shall have the right, in its sole and absolute discretion, to refuse or decline to participate in any other financing of or investment in the Company, and shall have no obligation to assist or cooperate with the Company in obtaining any financing, in vestment or other assistance.
7.17           Remedies.   In addition to being entitled to exercise all rights provided herein or granted by law, including recovery of damages, each of the Purchasers and the Company will be entitled to specific performance under this Agreement.  The parties agree that monetary damages may not be adequate compensation for any loss incurred by reason of any breach of obligations contained in this Agreement and hereby agree to waive and not to assert in any action for specific performance of any such obligation the defense that a remedy at law would be adequate.
7.18           Payment Set Aside.   To the extent that the Company makes a payment or payments to any Purchaser pursuant to any Transaction Agreement or a Purchaser enforces or exercises its rights thereunder, and such payment or payments or the proceeds of such enforcement or exercise or any part thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside, recovered from, disgorged by or are required to be refunded, repaid or otherwise restored to the Company, a trustee, receiver or any other person or entity under any law (including, without limitation, any bankruptcy law, state or federal law, common law or equitable cause of action), then to the extent of any such restoration the obligation or part thereof originally intended to be satisfied shall be revived and continued in full force and effect as if such payment had not been made or such enforcement or setoff had not occurred.

Exhibit 10.2 Securities Purchase Agreement -- Page 17



7.19           Independent Nature of Purchasers' Obligations and Rights.   The obligations of each Purchaser under any Transaction Document are several and not joint with the obligations of any other Purchaser, and no Purchaser shall be responsible in any way for the performance or non-performance of the obligations of any other Purchaser under any Transaction Document.  Nothing contained herein or in any other Transaction Document, and no action taken by any Purchaser pursuant hereto or thereto, shall be deemed to constitute the Purchasers as a partnership, an association, a joint venture or any other kind of entity, or create a presumption that the Purchasers are in any way acting in concert or as a group with respect to such obligations or the transactions contemplated by the Transaction Documents.  Each Purchaser shall be entitled to independently protect and enforce its rights including, without limitation, the rights arising out of this Agreement or out of the other Transaction Documents, and it shall not be necessary for any other Purchaser to be joined as an additional party in any proceeding for such purpose.  Each Purchaser has been represented by its own separate legal counsel in its review and negotiation of the Transaction Documents.  It is expressly understood and agreed that each provision contained in this Agreement and in each other Transaction Document is between the Company and a Purchaser, solely, and not between the Company and the Purchasers collectively and not between and among the Purchasers.  SRFK does not represent any of the Purchasers and only represents the Placement Agent.

[ Signature Pages Follow ]


Exhibit 10.2 Securities Purchase Agreement -- Page 18

IN WITNESS WHEREOF, the parties have executed this Securities Purchase Agreement as of the date first written above.
 
COMPANY :
 
By:
 
 
Name:
 
 
Title:
 
 
Address:
CytoBioscience, Inc.
     
   
Attn:
     
 
PURCHASERS:
 
The Purchasers executing the Signature Page in the form attached hereto and delivering the same to the Company or its agents shall be deemed to have executed this Agreement and agreed to the terms of all Transaction Documents.

Exhibit 10.2 Securities Purchase Agreement -- Page 19

 
 
PURCHASER SIGNATURE PAGE TO
CYTOBIOSCIENCE, INC. SECURITIES PURCHASE AGREEMENT

The undersigned, desiring to: (i) enter into the securities purchase agreement, dated as of _____________, ______ (the " Securities Purchase   Agreement "), between the undersigned, CYTOBIOSCIENCE, INC., a Delaware corporation (the " Company "), and the other parties thereto, in or substantially in the form furnished to the undersigned and purchase the units of the Company (the " Units ") as set forth below, hereby agrees to purchase such Units from the Company and further agrees to join the Securities Purchase Agreement as a party thereto, with all the rights and privileges appertaining thereto, and to be bound in all respects by the terms and conditions thereof.  The undersigned specifically acknowledges having read the representations section in the Securities Purchase Agreement entitled "Representations and Warranties of the Purchasers," and hereby represents that the statements contained therein are complete and accurate with respect to the undersigned as a Purchaser.

The undersigned Purchaser hereby elects to purchase   Units ($ _____ ) under the Securities Purchase Agreement.

PURCHASER (individual)
 
PURCHASER (entity)
     
Signature
 
Name of Entity
     
Print Name
 
Signature
   
Print Name:
Signature (if Joint Tenants or Tenants in Common)
 
Title:
Address of Principal Residence:
 
Address of Executive Offices:
     
     
Social Security Number(s):
 
IRS Tax Identification Number:
     
Telephone Number:
 
Telephone Number:
Facsimile Number:
 
Facsimile Number:



Exhibit 10.2 Securities Purchase Agreement -- Page 20

EXHIBIT A
AGREEMENT OF MERGER AND PLAN OF REORGANIZATION
 
 
 
 
 
 
 

 
Exhibit 10.2 Securities Purchase Agreement -- Page 21

 

 
EXHIBIT B
DISCLOSURE SCHEDULE

 
 
 

 

Exhibit 10.2 Securities Purchase Agreement -- Page 22

 
 

 
EXHIBIT C
FORM OF PARENT WARRANT

 
 
 
 
 

 





Exhibit 10.2 Securities Purchase Agreement -- Page 23

Exhibit 10.3
 
 



Divine Capital Markets LLC Investment Banking Agreement


Sent via email to j.garvin@cytobioscience.com

CytoBioscience Incorporated
3453 Magic Dr S 120
San Antonio, TX 79229 USA

Attn: James Garvin, PhD


Dear Dr. Garvin:

The purpose of this letter agreement (this "Engagement Letter" or the "Agreement") is to set forth the terms and conditions pursuant to which Divine Capital Markets LLC ("Divine" or the "Placement Agent"), shall serve as the Placement Agent; in that capacity the Placement Agent shall introduce CYTOCENTRICS BIOSCIENCE INCORPORATED  (the "Company") to one or more investors (each an "Introduced Investor") in connection with the proposed offering up to $ 5MM (the "Placement" or "Offering") of securities ("Securities") of the Company on a "best efforts" basis, subject to the terms and conditions of this Agreement.
   
The terms of an Offering and the Securities issued in such Offering shall be mutually agreed upon by the Company and the purchasers in such Offering (each, a "Purchaser" and collectively, the "Purchasers") and nothing herein enables the Placement Agent to bind the Company or any Purchaser. This Agreement and the documents executed and delivered by the Company and the Purchasers in connection with the Placement shall be collectively referred to herein as the "Transaction Documents."  The materials utilized to offer the Securities shall be referred to as the "Offering Materials."  The date of each of the closings of an Offering shall be referred to herein as the "Closing Date."  The Company expressly acknowledges and agrees that the Placement Agent's obligations hereunder are on a reasonable "best efforts" basis only and that the execution of this Agreement does not constitute a commitment by the Placement Agent to purchase or to sell the Securities and does not ensure the successful placement of the Securities or any portion thereof.  The identities of the Introduced Investors shall be proprietary information of the Placement Agent and shall not be divulged to third parties by the Company, nor used by the Company outside the scope of the Placement Agent's engagement as described herein, other than as required by applicable law; provided, however, that nothing in the preceding sentence shall prohibit the Company from dealing with any Purchaser with respect to their investment in the Company.

The subscription proceeds for any Securities sold in the Offering will be deposited in a non-interest bearing escrow account established by the Company and the Placement Agent at U.S. Bank, or another mutually acceptable federally chartered bank, in accordance with the requirements of Rule 15c2-4 and the interpretations relating thereto issued by the Financial Industry Regulatory Authority.  Upon Closing of the Offering, the proceeds will be released upon the joint authorization and direction of the Company and the Placement Agent; notwithstanding the foregoing, the Placement Agent will authorize, at the direction of the Company, the release of any and all proceeds attributable to investors who are not Introduced Investors ; upon termination of the Offering without any Closings, the escrow agreement  governing the account shall provide that the escrow agent shall promptly return such proceeds, without the payment of interest and without deduction, to the subscribers.
 
Exhibit 10.3 Investment Banking Agreement -- Page 1



SECTION 1.           COMPENSATION AND OTHER FEES.

(A)           As compensation for all of the Placement Agent's services hereunder, the Placement Agent shall be entitled to a selling commission in cash equal to xx percent 8..0%) of the gross proceeds from the sale of Securities as a part of the Offering to Introduced Investors consummated at each Closing, which commission will be due and payable upon the receipt by the Company of the net proceeds thereof from the escrow described in the preceding paragraph (each an "Escrow Closing"). For the BOCO Group, the Placement Agent shall be entitled to a selling commission in cash equal to 4 percent (4.0%) of the gross proceeds from such sale of Securities which are consummated at a Closing, which commission will be due and payable upon the relevant Escrow Closing.
 
(B)           Warrants.  As additional compensation for the Services to be provided by the Placement Agent in connection with the Offering, at the relevant Escrow Closing the Company shall issue to the Placement Agent or its designees warrants (the "Placement Agent Warrants") to purchase that number of Securities equal to eight percent (8.0%) of the aggregate number of Securities sold to Introduced Investors in the relevant Closing;  in determining the number Securities for purposes of issuing the Placement Agent Warrants, "Securities" shall take into consideration securities underlying convertible Securities closed in the Offering. The Placement Agent Warrants shall have an exercise price equal to 125% of the price at which Securities are issued to Investors, an exercise period of five years.  The Warrants shall be issued to Divine contemporaneously with an Escrow Closing and shall contain customary terms, including, without limitation, provisions for cashless exercise, corporate and price based anti-dilution protections and registration rights consistent with the registration rights granted to the investors in the Offering.



SECTION 2.           SERVICES TO BE RENDERED BY DIVINE

Without limiting the generality of the foregoing, Divine will:

(A)
Study and review the business, operations, and financial performance of COMPANY (based in part upon management's forecast of financial performance) so as to enable Divine to provide advice to COMPANY;

(B)
Assist COMPANY in formulating the best strategy to meet COMPANY's working capital and capital resource needs;

(C)
Introduce COMPANY to potential investors (whether such investment is in the form of debt and/or equity financing or some combination thereof).  

(D)
Assist in the formulation of the terms and structure of any reasonably proposed business combination transaction involving COMPANY, including without limitation, any merger or consolidation, sale of assets, or sale or exchange of stock (a "Business Combination");

(E)
Assist in the presentation to the Board of Directors of COMPANY of any proposed transaction;
 
 
 
Exhibit 10.3 Investment Banking Agreement -- Page 2

 
 

 
(F)
Advise COMPANY in the preparation of press releases and other communications for the financial and investment communities;

(G)
Divine agrees to furnish advice to COMPANY in connection with the identification of individual and institutional sources of financing; arrangement of appropriate introductions to same parties; and marketing of financing proposals. Divine will also assist in preparation of the Transaction Documents and Offering  Materials.  Divine shall also render such other financial consulting and/or investment banking services as may from time to time be agreed upon by Divine and COMPANY.

(H)
Milestones

(I)
Divine will update COMPANY on at least a weekly basis on the progress of milestones.


SECTION 3.           COMPANY REPRESENTATIONS AND WARRANTIES.

The Company represents and warrants to, and agrees with, the Placement Agent that:

(A)           The Offering Memorandum (and any documents that accompany it) as amended or supplemented will comply in all material respects with the Securities Act and the applicable Rules and Regulations.  The Offering Memorandum (and any documents to accompany it) as amended or supplemented will not contain as of the date thereof any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. Any incorporated documents (the "Incorporated Documents"), when filed with the Securities and Exchange Commission (the "Commission"), conformed when filed in all material respects to the requirements of the Exchange Act and the applicable Rules and Regulations, and none of such documents, when they were or are filed with the Commission, contained any untrue statement of a material fact or omitted to state a material fact necessary to make the statements therein (with respect to Incorporated Documents incorporated by reference in the Offering Memorandum as amended or supplemented, in light of the circumstances under which they were made not misleading); and any further documents subsequently incorporated by reference in the Offering Memorandum, as amended or supplemented, when such documents are filed with the Commission, will conform in all material respects to the requirements of the Exchange Act and the applicable Rules and Regulations, as applicable, and will not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading.

(B)           In dealing with the Introduced Investors, the Company will not, without the prior consent of the Placement Agent, prepare, use or refer to, any Offering Memorandum or other offering materials.
 
 
Exhibit 10.3 Investment Banking Agreement -- Page 3

 
 

 
(C)            The Company will furnish promptly to the Placement Agent all information and material concerning the Company and the Offering that the Placement Agent requests in connection with the performance of its obligations hereunder.  The Company represents and warrants that all information made available to the Placement Agent by the Company will, at all times during the period of the engagement of the Placement Agent hereunder, be complete and correct in all material respects and will not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein not misleading in light of the circumstances under which such statements are made.  The Company further represents and warrants that any financial or other projections or forecasts provided to the Placement Agent will have been prepared in good faith and will be based upon assumptions which, in light of the circumstances under which they are made, are reasonable.  The Company acknowledges and agrees that in rendering its services hereunder the Placement Agent will be using and relying upon, without any independent investigation or verification thereof, all information that is or will be furnished to the Placement Agent by or on behalf of the Company and on publicly available information, and the Placement Agent will not in any respect be responsible for the accuracy or completeness of any of the foregoing information, and that the Placement Agent will not undertake to make an independent appraisal of any of the assets or of the business of the Company.  The Company understands that in rendering services hereunder the Placement Agent does not provide accounting, legal or tax advice and will rely upon the advice of the Placement Agent's counsel and advisers, as well as counsel to the Company and other advisors to the Company as to accounting, legal, tax and other matters relating to any matters contemplated by this Agreement.

SECTION 4.           REPRESENTATIONS AND WARRANTIES.

The Placement Agent shall be entitled to rely upon any and all representations and warranties of the Company included in the purchase agreements entered into by the Company and the Purchasers in connection with the Placement, subject to the qualifications and limitations therein, including, but not limited to, any disclosure set forth on an applicable schedule.

SECTION 5.           ENGAGEMENT TERM & SURVIVAL.

 The Placement Agent's engagement under this Agreement shall be non-exclusive for a period of six months from the date hereof, and shall be extended upon mutual agreement of the Company and the Placement Agent for an additional six months from the date of any Closing of an Offering hereunder pursuant to which the aggregate proceeds equal or exceed one million dollars (the "Term").  Notwithstanding the foregoing, this Agreement may be terminated by either the Company or the Placement Agent at any time after the initial six month period, upon 30 days' written notice; provided however that in the event of the termination or expiration of this Agreement, the Placement Agent's compensation due under Section 1 (A) and (B) of this Agreement for the sale of Securities to Introduced Investors will be payable in full at Escrow Closings occurring during the twelve (12) month period commencing with such termination or expiration (the "Tail Period").  The Company shall pay Divine the applicable Tail Period Compensation, provided, however, that (i) no Tail Period Compensation shall become due and payable unless and until the Closing has occurred and the Company actually receives the cash proceeds from a Financing Transaction, (ii) in no event shall any Tail Period Compensation be payable if this Agreement is terminated due to the material breach of this Agreement by Placement Agent. For the avoidance of doubt, in the event of more than one Closing, a pro rata portion of the aggregate Tail Period Compensation shall be due based on the actual cash proceeds received by the Company at each such Closing prior to the expiration of the Tail Period. Notwithstanding anything to the contrary contained herein, the Company's representations and warranties; the provisions concerning confidentiality, indemnification, contribution, choice of law and venue; and the Company's obligations to pay fees earned and payable pursuant to Section 1 hereof, will survive any expiration or termination of this Agreement.  The Placement Agent agrees not to use any confidential information concerning the Company provided to them by the Company for any purposes other than those contemplated under this Agreement.
Exhibit 10.3 Investment Banking Agreement -- Page 4


SECTION 6.           PLACEMENT AGENT INFORMATION.

The Company agrees that any written or oral advice rendered by the Placement Agent in connection with this engagement is for the confidential use of the Company only in its evaluation of the Placement and preparation of the Offering Materials and, except as otherwise required by law, the Company will not disclose or otherwise refer to the advice in any manner without prior written consent of the Placement Agent.

SECTION 7.           NO FIDUCIARY RELATIONSHIP.

This Agreement does not create, and shall not be construed as creating rights enforceable by any person or entity that is not a party hereto, except those entitled hereto by virtue of the indemnification provisions hereof.  The Company acknowledges and agrees that the Placement Agent is not and shall not be construed as a fiduciary of the Company and that the Placement Agent shall not have any duties or liabilities to the equity holders or the creditors of the Company or to any other person by virtue of this Agreement or the retention of the Placement Agent hereunder, all of which are hereby expressly waived.

SECTION 8.           CLOSING.

The obligations of the Placement Agent and the Purchasers, and the Closing(s) of the sale of the Securities hereunder, are subject to the accuracy, when made and on the respective Closing Date, of the representations and warranties of the Company contained or incorporated herein, to the accuracy of the statements of the Company made in any certificates pursuant to the provisions hereof, to the performance by the Company of their obligations hereunder, and to each of the following additional terms and conditions:

 (A)           No stop order relating to the Offering shall have been issued by any federal or state agency.

(B)           The Placement Agent shall not have discovered on or prior to the Closing Date that the Offering Memorandum or any amendment or supplement thereto or any Incorporated Documents, contains an untrue statement of a fact which, in the opinion the Placement Agent, is material or omits to state any fact which, in the opinion of the Placement Agent, is material and is required to be stated therein or is necessary to make the statements therein not misleading.

(C)           All corporate proceedings and other legal matters incident to the authorization, form, execution, delivery and validity of each of this Agreement, the Securities, the Offering Memorandum as amended or supplemented, the Transaction Documents, and all other legal matters relating to this Agreement and the transactions contemplated hereby shall be reasonably satisfactory in all material respects to the Placement Agent and its counsel, and the Company shall have furnished to the Placement Agent and to its counsel all documents and information that they may reasonably request to enable them to pass upon such matters.

(D)           The Placement Agent shall have received from outside counsel to the Company such counsel's written opinion, addressed to each of the Placement Agent and the Purchasers dated as of the Closing Date, in form and substance reasonably satisfactory to the Placement Agent.
 
 
Exhibit 10.3 Investment Banking Agreement -- Page 5

 

 
(E)           Neither the Company nor any of its Subsidiaries (i) shall have sustained since the date of the latest audited or, in the case if an audit has not been completed, unaudited financial statements included or incorporated by reference in the Offering Memorandum, as amended or supplemented, any loss or interference with its business from fire, explosion, flood, terrorist act or other calamity, whether or not covered by insurance, or from any labor dispute or court or governmental action, order or decree, otherwise than as set forth in or contemplated by the Offering Memorandum, as amended or supplemented, and (ii) since such date there shall not have been any material change in the capital stock or long-term debt of the Company or any of its Subsidiaries or any change, or any development involving a prospective change, in or affecting the business, general affairs, management, financial position, stockholders' equity, results of operations or prospects of the Company and its Subsidiaries, otherwise than as set forth in or contemplated by the Offering Memorandum, as amended or supplemented, the effect of which, in any such case described in clause (i) or (ii), is, in the judgment of the Placement Agent, so material and adverse as to make it impracticable or inadvisable to proceed with the sale or delivery of the Securities on the terms and in the manner contemplated by the Offering Memorandum, as amended or supplemented.

(F)           Subsequent to the execution and delivery of this Agreement, there shall not have occurred any of the following: (i) trading in securities generally on the New York Stock Exchange, the Nasdaq National Market or the NYSE Amex or in the over-the-counter market, or trading in any securities of the Company on any exchange or in the over-the-counter market, shall have been suspended or minimum or maximum prices or maximum ranges for prices shall have been established on any such exchange or such market by the Commission, by such exchange or by any other regulatory body or governmental authority having jurisdiction, (ii) a banking moratorium shall have been declared by federal or state authorities or a material disruption has occurred in commercial banking or securities settlement or clearance services in the United States, (iii) the United States shall have become engaged in hostilities in which it is not currently engaged, the subject of an act of terrorism, there shall have been an escalation in hostilities involving the United States, or there shall have been a declaration of a national emergency or war by the United States, or (iv) there shall have occurred any other calamity or crisis or any change in general economic, political or financial conditions in the United States or elsewhere, if the effect of any such event in clause (iii) or (iv) makes it, in the sole judgment of the Placement Agent, impracticable or inadvisable to proceed with the sale or delivery of the Securities on the terms and in the manner contemplated by Offering Memorandum, as amended or supplemented.

(G)           No action shall have been taken and no statute, rule, regulation or order shall have been enacted, adopted or issued by any governmental agency or body which would, as of a Closing Date, prevent the issuance or sale of the Securities or materially and adversely affect the business or operations of the Company; and no injunction, restraining order or order of any other nature by any federal or state court of competent jurisdiction shall have been issued as of a Closing Date which would prevent the issuance or sale of the Securities or materially and adversely affect the business or operations of the Company.

(H)           The Company shall be obligated following Closing to prepare and file with the Commission a Current Report on Form D with respect to the Placement.

(I)           The Company shall have entered into subscription agreements with each of the Purchasers and such agreements shall be in full force and effect and shall contain representations and warranties of the Company as agreed between the Company and the Purchasers.
 
 
 
Exhibit 10.3 Investment Banking Agreement -- Page 6

 

 
(J)           Prior to the Closing Date, the Company shall have furnished to the Placement Agent such further information, certificates and documents as either of the Placement Agent or its counsel shall request.

(K)           The terms of the Offering and of the Securities shall be acceptable to the Placement Agent.

(L)           The Transaction Documents shall be acceptable in form and substance to the Placement Agent.

(M)           The Company shall have paid or made arrangements for the prompt payment of all Offering out of pocket expenses (not to exceed $25,000), including the Blue Sky fees and expenses relating Blue Sky services to be performed by counsel to the Placement Agent.  Out of pocket expenses in excess shall be submitted to the Company in advance for approval, which approval shall not be unreasonably withheld.

All opinions, letters, evidence and certificates mentioned above or elsewhere in this Agreement shall be deemed to be in compliance with the provisions hereof only if they are in form and substance reasonably satisfactory to counsel for the Placement Agent.

SECTION 9.           INDEMNIFICATION.

The parties agree to the terms of the Placement Agent's standard indemnification agreement, which is attached hereto as Appendix A and incorporated herein by reference. The provisions of this Section 9 shall survive any termination of this Agreement.



SECTION 10.           ANNOUNCEMENTS.

The Company grants to the Placement Agent the right to place customary announcement(s) of the Placement in certain newspapers and to mail announcement(s) to persons and firms selected by Placement Agent subject to the Company's prior written approval, which shall not be unreasonably withheld, and all costs of such announcement(s) will be borne by such Placement Agent.

SECTION 11.           GOVERNING LAW.

This Agreement will be governed by, and construed in accordance with, the laws of the State of New York applicable to agreements made and to be performed entirely in such State.  This Agreement may not be assigned by either party without the prior written consent of the other party.  This Agreement shall be binding upon and inure to the benefit of the parties hereto, and their respective successors and permitted assigns.  Any right to trial by jury with respect to any dispute arising under this Agreement or any transaction or conduct in connection herewith is waived.  Any dispute arising under this Agreement may be brought into the courts of the State of New York located in New York County or into the Federal Court located in Manhattan, New York, New York and, by execution and delivery of this Agreement, the Company hereby accepts for itself and in respect of its property, generally and unconditionally, the jurisdiction of aforesaid courts.  Each party hereto hereby irrevocably waives personal service of process and consents to process being served in any such suit, action or proceeding by delivering a copy thereof via overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof.  Nothing contained herein shall be deemed to limit in any way any right to serve process in any manner permitted by law. If either party shall commence an action or proceeding to enforce any provisions of a Transaction Document, then the prevailing party in such action or proceeding shall be reimbursed by the other party for its attorneys fees and other costs and expenses incurred with the investigation, preparation and prosecution of such action or proceeding.
 
 
Exhibit 10.3 Investment Banking Agreement -- Page 7


 
 
SECTION 12.           ENTIRE AGREEMENT/MISC.

This Agreement embodies the entire agreement and understanding between the parties hereto, and supersedes all prior agreements and understandings, relating to the subject matter hereof.  If any provision of this Agreement is determined to be invalid or unenforceable in any respect, such determination will not affect such provision in any other respect or any other provision of this Agreement, which will remain in full force and effect.  This Agreement may not be amended or otherwise modified or waived except by an instrument in writing signed by each of the Placement Agent and the Company.  The representations, warranties, agreements and covenants contained herein shall survive the closing of the Placement and delivery and/or exercise of the Securities, as applicable.  This Agreement may be executed in two or more counterparts, all of which when taken together shall be considered one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to the other party, it being understood that both parties need not sign the same counterpart.  In the event that any signature is delivered by facsimile transmission or a .pdf format file, such signature shall create a valid and binding obligation of the party executing (or on whose behalf such signature is executed) with the same force and effect as if such facsimile or .pdf signature page were an original thereof.

SECTION 13.           NOTICES.

Any and all notices or other communications or deliveries required or permitted to be provided hereunder shall be in writing and shall be deemed given and effective on the earliest of (a) the date of transmission, if such notice or communication is delivered via facsimile at the facsimile number specified on the signature pages attached hereto prior to 6:30 p.m. (New York time) on a business day, (b) the next business day after the date of transmission, if such notice or communication is delivered via facsimile at the facsimile number on the signature pages attached hereto on a day that is not a business day or later than 6:30 p.m. (New York time) on any business day, (c) the business day following the date of mailing, if sent by U.S. nationally recognized overnight courier service, or (d) upon actual receipt by the party to whom such notice is required to be given.  The address for such notices and communications shall be as set forth on the signature pages hereto.

Please confirm that the foregoing correctly sets forth our agreement by signing and returning an executed copy of this Agreement to the Placement Agent.

Very truly yours,

DIVINE CAPITAL MARKETS, LLC
 
By: /s/ Danielle Hughes

 Name:  Danielle Hughes
 Title:  Chief Executive Officer

Signatures continued next page

Address for notice:

Divine Capital Markets LLC
39 Broadway 36th Floor
New York, NY 10006
 
 
 
Exhibit 10.3 Investment Banking Agreement -- Page 8



Accepted and Agreed to as of
the date first written above:


ISSUER NAME



By:   /s/ James Garvin                                                               
      Name: James Garvin
      Title: CEO(


Address for notice:
 
3463 Magic Drive
Suite 120
San Antonio, TX 78229
 
 

Exhibit 10.3 Investment Banking Agreement -- Page 9

 
 
APPENDIX A - - INDEMNIFICATION PROVISIONS


(A)  The Company agrees to indemnify and hold harmless the Placement Agent and its affiliates and their respective officers, directors, employees, agents, counsel, advisers and consultants, and any persons controlling the Placement Agent or any of its affiliates within the meaning of Section 15 of the Securities Act of 1933 or Section 20 of the Securities Exchange Act of 1934 (the Placement Agent and each such other person or entity being referred to herein as an "Indemnified Person"), from and against all claims, liabilities, losses or damages (or actions in respect thereof) or other expenses which (A) are related to or arise out of (i) actions taken or omitted to be taken (including any untrue statements made or any statements omitted to be made) by the Company or its respective affiliates or (ii) actions taken or omitted to be taken by an Indemnified Person with the consent or in conformity with the actions or omissions of the Company or their respective affiliates or (iii) any investigation, litigation, or inquiry by a regulatory or self-regulatory agency or authority involving the Company or any transaction arising under any agreements between the Company and the Placement Agent or (B) are otherwise related to or arise out of the Placement Agents' activities on behalf of the Company or its respective affiliates pursuant to this Agreement or (C) in any way involving or alleged to involve the Company, the Offering or the Securities.  The Company will not be responsible, however, for any losses, claims, damages, liabilities or expenses pursuant to clause (B) of the preceding sentence which are finally judicially determined to have resulted solely from such Indemnified Person's gross negligence or willful misconduct.  In addition, the Company agrees to advance (and in the absence of advancement required hereunder) to promptly reimburse each Indemnified Person for all out-of-pocket expenses (including fees and expenses of counsel) as they are incurred by such Indemnified Person in connection with investigating, preparing, conducting or defending any such action or claim, whether or not in connection with litigation in which any Indemnified Person is a named party, or in connection with enforcing the rights of such Indemnified Person under this Agreement.

(B)   Promptly after receipt by the Placement Agent of notice of any claim or the commencement of any action or proceeding with respect to which the Placement Agent is entitled to indemnity hereunder, the Placement Agent will notify the Company in writing of such claim or of the commencement of such action or proceeding, and the Company will assume the defense of such action or proceeding and will employ counsel reasonably satisfactory to the Placement Agent and will pay the fees and expenses of such counsel.  Notwithstanding the preceding sentence, the Placement Agent will be entitled to employ counsel separate from counsel for the Company and from any other party in such action if counsel for the Placement Agent determines that to do so would be in the best interests of the Placement Agent.  In such event, the reasonable fees and disbursements of no more than one such separate counsel will be paid by the Company.  The Company will have the exclusive right to settle the claim or proceeding at its sole expense provided (i) such settlement includes an unconditional release of each Indemnified Party from any liabilities arising out of such action and does not include any findings of fact or admissions of culpability as to the Indemnified Party and (ii) the parties agree that the terms of such Settlement shall remain confidential.

(C)   The Company agrees to notify the Placement Agent promptly of the assertion against it or any other person of any claim or the commencement of any action or proceeding relating to a transaction contemplated by this engagement letter.
 
 

Exhibit 10.3 Investment Banking Agreement -- Page 10

 
 

 
(D)   If for any reason the foregoing indemnity is unavailable to the Placement Agent or insufficient to hold the Placement Agent harmless, then the Company shall contribute to the amount paid or payable by the Placement Agent as a result of such losses, claims, damages or liabilities in such proportion as is appropriate to reflect not only the relative benefits received by the Company on the one hand and the  Placement Agent on the other, but also the relative fault of the Company on the one hand and the Placement Agent on the other that resulted in such losses, claims, damages or liabilities, as well as any relevant equitable considerations.  The amounts paid or payable by a party in respect of losses, claims, damages and liabilities referred to above shall be deemed to include any legal or other fees and expenses incurred in defending any litigation, proceeding or other action or claim.  Notwithstanding the provisions hereof, the Placement Agent's share of the liability hereunder shall not be in excess of the amount of fees actually received, or to be received, by such Placement Agent under this engagement letter (excluding any amounts received as reimbursement of expenses incurred by such Placement Agent).

(E)   These indemnification provisions shall remain in full force and effect whether or not the transaction contemplated by this Agreement is completed and shall survive the termination of this Agreement, and shall be in addition to any liability that the Company might otherwise have to any indemnified party under this engagement letter or otherwise.
 
 
 
 
 
 
 
 
 
 
 
 
 


 
Exhibit 10.3 Investment Banking Agreement -- Page 11

Exhibit 16.1
 
 


Securities and Exchange Commission
100 F Street, NE
Washington, District of Columbia 20549
 
Re:
Westmountain Company
Ladies and Gentlemen:
We have read Item 4.01 of Form 8-K dated March 23, 2018 of Westmountain Company and are in agreement with all statements made pertaining to EKS&H LLLP. We have no basis to agree or disagree with other statements of the registrant contained therein.


/s/    EKS&H LLLP


March 23, 2018
Denver, Colorado


Exhibit 99.1
 
 

CytoBioscience, Inc. Announces Merger
With WestMountain Company

San Antonio, TX – (Accesswire) – March 23, 2018 CytoBioscience, Inc. (the "Company"), a revenue-generating ion channel screening business providing medical instrumentation and research services to organizations in the pharmaceutical and drug research market, today announced that it has closed a merger (the "Merger") with WestMountain Company (OTCBB: WASM) ("WestMountain"), effective March 19, 2018.
On March 19, 2018, WestMountain entered into a Merger Agreement with CytoBioscience, Inc., a Delaware corporation (the "Merger Agreement"). As per the terms of the Merger Agreement, a subsidiary of WestMountain merged into CytoBioscience, with CytoBioscience surviving the merger and becoming a wholly-owned subsidiary of WestMountain, and the shareholders of CytoBioscience becoming shareholders of WestMountain.  Pursuant to terms of the Merger Agreement, all outstanding shares of capital stock of CytoBioscience were cancelled and exchanged for the issuance of 42,522,598   shares of common stock of WestMountain. In addition, warrants to purchase 2,040,000 shares of Common Stock of WestMountain were issued in exchange for all outstanding warrants of CytoBioscience, which were cancelled . The closing of the Merger on March 19, 2018 resulted in a change of control of WestMountain. The shares of WestMountain common stock issued to CytoBioscience's shareholders in the Merger constitute approximately 74% of the issued and outstanding shares of WestMountain's common stock as of and immediately after the consummation of the Merger. All of the newly issued shares will be subject to a lock-up agreement which prohibits sales for a period of at least two years. In addition, the directors of the WestMountain will seek shareholder approval to change the name of WestMountain to CytoBioscience, Inc., and new directors will be appointed to the board 10 days after the filing of a Schedule 14f-1 with the Securities and Exchange Commission. In connection with the Merger, Brian L. Klemsz resigned as an officer of WestMountain, and James Garvin, Chief Executive Officer of CytoBioscience, became Chief Executive Officer of WestMountain, Dr. Thomas Knott as the Chief Science Officer of WestMountain, and Henry Bourg became Chief Financial Officer of WestMountain.
Dr. Garvin said "We very excited about the opportunities this merger gives our combined company and we look forward and are enthusiastic about the new possibilities ahead for us."
For further information regarding certain terms and conditions contained in the merger agreement, please see WestMountain 's Current Report on Form 8-K, which will be filed in connection with this transaction.
About CytoBioscience, Inc.
Headquartered in San Antonio, Texas, CytoBioscience is a revenue-generating ion channel screening business providing medical instrumentation and research services to organizations in the pharmaceutical and drug research market.
 
 

 
 
CytoBioscience's flagship precision instrument is the CytoPatch Freedom , for which the company also develops and manufactures various cell lines and related consumables used in research and drug development.  The company, as well, conducts CRO services, using the Freedom , for a growing list of clients in drug development and  research
In addition to the Freedom , the company's HSC instrument, is used to determine and optimize the solubility of protein drugs – solubility is a key factor in protein based drug development. Soluble Bioscience, a wholly owned subsidiary, makes the HSC instrument.
For more information on CytoBioscience, please visit our website at http://www.cytobioscience.com .
Forward-Looking Statements
To the extent that any statements made in this press release contain information that is not historical, these statements are essentially forward-looking.  Forward-looking statements can be identified by the use of words such as "expects", "plans", "may", "anticipates", "believes", "should", "intends", "estimates", and other words of similar meaning.  These statements are subject to risks and uncertainties that cannot be predicted or quantified and, consequently, actual results may differ materially from those expressed or implied by such forward-looking statements.  Such risks and uncertainties include, without limitation, our ability to raise additional capital to finance our activities; the effectiveness, profitability and marketability of our products; the effect of competition on our ability to market our products; the effects of Food and Drug Administration ("FDA") and other regulation on our business and products; legal and regulatory risks associated with the share exchange; the future trading of our common stock; our ability to operate as a public company; our ability to protect our proprietary information; general economic and business conditions; the volatility of our operating results and financial condition; our ability to attract or retain qualified senior management personnel and research and development staff; and other risks detailed from time to time in our filings with the Securities and Exchange Commission (the "SEC"), or otherwise.
Information regarding market and industry statistics contained in this press release are included based on information available to us that we believe is accurate.  It is generally based on industry and other publications that are not produced for purposes of securities offerings or economic analysis.  Forecasts and other forward-looking information obtained from these sources are subject to the same qualifications and the additional uncertainties accompanying any estimates of future market size, revenue and market acceptance of products and services.  We do not undertake any obligation to publicly update any forward-looking statements.  As a result, investors should not place undue reliance on these forward-looking statements.