UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.
20549
___________________
FORM 8-K
___________________
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of report (date of earliest event reported): May 12, 2016
EMERALD MEDICAL APPLICATIONS CORP.
(Exact Name of Registrant
as Specified in its Charter)
Commission File No.: 0-15476
| Delaware | 68-0080601 |
| (State of Incorporation) | (I.R.S. Employer Identification No.) |
| 7 Imber Street, Petach Tikva, Israel | 4951141 |
| (Address of Principal Executive Offices) | (ZIP Code) |
Registrant's Telephone Number, including area code: (972) 3-744-4505
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 (see General Instruction A.2. below):
¨
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))
Item 1.01 Entry Into a Material Definitive Agreement
On May 12, 2016, Emerald Medical Applications Corp. (the "Registrant") entered into an Equity Purchase Agreement and a Registration Rights Agreement with Kodiak Capital Group, LLC, a limited liability company organized under the laws of the State of Delaware with offices located in Newport Beach, CA (the "Investor" or "Kodiak"). Under the Equity Purchase Agreement, the Registrant shall issue and sell to the Investor and sell to Investor, from time to time, and Investor shall purchase up to One Million ($1,000,000) Dollars of the Registrant's common stock, par value $0.0001 per share ("Common Stock" or "Shares") as set forth in the Equity Purchase Agreement, a copy of which is attached as Exhibit 10.20 hereto. As partial consideration for the Equity Purchase Agreement, the Registrant also issued to the Investor 150,000 Shares as a commitment fee (the "Commitment Shares"). In connection with the execution of the Equity Purchase Agreement, more fully discussed below, the Registrant also entered into a Registration Rights Agreement with Kodiak, a copy of which is attached as Exhibit 10.21 hereto, pursuant to which the Registrant has agreed to file a registration statement on Form S-1 by June 30, 2016 (the "Registration Statement") to register for resale the Put Shares of Common Stock that may be issued under the Equity Purchase Agreement and the Commitment Shares.
Pursuant to the Equity Purchase Agreement, from the date that the Securities and Exchange Commission (the "SEC") has declared the Registration Statement effective (the "Effective Date") until the one year anniversary thereof, the Registrant has the right to sell, from time to time, up to an aggregate of One Million ($1,000,000) Dollars of Put Shares to the Investor. The Registrant will control the timing and amount of future sales, if any. The purchase price of the Put Shares will be equal to 70% of the market price of the Common Stock as defined in the Equity Purchase Agreement. While there is no minimum amount that the Registrant may require the Investor to purchase at any one time, the Registrant may not require the Investor to purchase Put Shares of Common Stock if such purchase would result in the Investor's beneficial ownership exceeding 9.99% of the outstanding Common Stock. The Equity Purchase Agreement contains customary representations, warranties, covenants, closing conditions, and indemnification and termination provisions. The Investor has covenanted not to cause or engage in any direct or indirect short selling of the Common Stock. The Equity Purchase Agreement may be terminated by the Registrant at any time at its discretion without any cost to the Registrant.
The Equity Purchase Agreement and the Registration Rights Agreement are attached as Exhibits hereto to give investors information regarding the agreements' respective terms. They are not provided to give investors factual information about the Registrant or any other parties thereto. In addition, the representations, warranties and covenants contained in the Purchase Agreement and the Registration Rights Agreement were made only for purposes of those agreements and as of specific dates, were solely for the benefit of the parties to those agreements, and may be subject to limitations agreed by the contracting parties, including being qualified by disclosures exchanged between the parties in connection with the execution of such agreements. Investors are not third-party beneficiaries under these agreements and should not view the representations, warranties and covenants or any descriptions thereof as characterizations of the actual state of facts or conditions of the Registrant.
The foregoing description of the Equity Purchase Agreement and the Registration Rights Agreement are qualified in their entirety by reference to the full text of thereof, copies of each of which are attached hereto as Exhibits 10.20 and 10.21, respectively, and each of which is incorporated herein in its entirety by reference.
Item 3.02 Unregistered Sales of Equity Securities.
On May 12, 2016, the Registrant issued and sold unregistered 150,000 restricted shares of its Common Stock (the "Commitment Shares") to Kodiak as follows:
| Name of Issuee | Date of Issuance | Number of Shares | Consideration | Bases for Issuance |
| Kodiak Capital Corp. (1) | 05/12/2016 | 150,000 | (1) | Equity Purchase Agreement (1) |
(1) The 150,000 restricted Shares were issued to Kodiak as partial consideration and represent commitment Shares under the Equity Purchase Agreement between the Registrant and Kodiak dated May 12, 2016, a copy of which is attached hereto as Exhibit 10.20.
The issuance and sale of the 150,000 Shares to Kodiak, without registration under the Securities Act of 1933, as amended (the "Act"), was made in reliance upon the exemptions provided in Section 4(2) of the Act and Regulation D promulgated by the United States Securities and Exchange Commission under the Act.
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.
|
/s/ Lior Wyan
|
Exhibit 10.20
EQUITY PURCHASE AGREEMENT
THIS EQUITY PURCHASE AGREEMENT entered into as of the 12th day of May, 2016
(this "AGREEMENT"), by and between KODIAK CAPITAL GROUP, LLC, a Delaware limited
liability company ("INVESTOR"), and EMERALD MEDICAL APPLICATIONS CORP., a
Delaware corporation (the "COMPANY").
WHEREAS, the parties desire that, upon the terms and subject to the conditions
contained herein, the Company shall issue and sell to Investor, from time to
time as provided herein, and Investor shall purchase up to One Million Dollars
($1,000,000) of the Company’s Common Stock (as defined below).
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE I
CERTAIN DEFINITIONS
Section 1.1 DEFINED TERMS as used in this Agreement, the following terms shall
have the following meanings specified or indicated (such meanings to be equally
applicable to both the singular and plural forms of the terms defined)
"AGREEMENT" shall have the meaning specified in the preamble hereof.
"BY-LAWS" shall have the meaning specified in Section 4.7.
"CLAIM NOTICE" shall have the meaning specified in Section 9.3(a).
“CLEARING DATE” shall be the date in which the Put Shares have been deposited
into the Investor’s brokerage account.
"CLOSING" shall mean one of the closings of a purchase and sale of shares of
Common Stock pursuant to Section 2.3.
"CLOSING CERTIFICATE" shall mean the closing certificate of the Company in the
form of Exhibit B hereto.
"CLOSING PRICE" shall mean the closing bid price for the Company’s common stock
on the Principal Market on a Trading Day as reported by Bloomberg Finance L.P.
"COMMITMENT SHARES" shall have the meaning specified in Section 2.1(b).
"COMMITMENT PERIOD" shall mean the period commencing on the Execution Date, and
ending on the earlier of (i) the date on which Investor shall have purchased Put
Shares pursuant to this Agreement for an aggregate Purchase Price of the Maximum
Commitment Amount or (ii) the one-year anniversary of the Execution Date.
"COMMON STOCK" shall mean the Company's common stock, $0.0001 par value per
share, and any shares of any other class of common stock whether now or
hereafter authorized, having the right to participate in the distribution of
dividends (as and when declared) and assets (upon liquidation of the Company).
"COMPANY" shall have the meaning specified in the preamble to this Agreement.
"DAMAGES" shall mean any loss, claim, damage, liability, cost and expense
(including, without limitation, reasonable attorneys' fees and disbursements and
costs and expenses of expert witnesses and investigation).
"DISPUTE PERIOD" shall have the meaning specified in Section 9.3(a).
"EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as amended, and
the rules and regulations promulgated thereunder.
"EXECUTION DATE" shall mean the date on which this Agreement is executed and
delivered by the Company and Investor.
"FINRA" shall mean the Financial Industry Regulatory Authority, Inc.
"INVESTMENT AMOUNT" shall mean the Put Shares referenced in the Put Notice
multiplied by the Purchase Price.
"INDEMNIFIED PARTY" shall have the meaning specified in Section 9.3(a).
"INDEMNIFYING PARTY" shall have the meaning specified in Section 9.3(a).
"INDEMNITY NOTICE" shall have the meaning specified in Section 9.3(b).
"INVESTOR" shall have the meaning specified in the preamble to this Agreement.
"MARKET PRICE" shall mean the lowest closing bid price on the Principal Market
for any Trading Day during the Valuation Period, as reported by Bloomberg
Finance L.P.
"MATERIAL ADVERSE EFFECT" shall mean any effect on the business, operations,
properties, or financial condition of the Company that is material and adverse
to the Company and/or any condition, circumstance, or situation that would
prohibit or otherwise materially interfere with the ability of the Company to
enter into and perform its obligations under any of this Agreement.
"MAXIMUM COMMITMENT AMOUNT" shall mean One Million Dollars ($1,000,000).
"PERSON" shall mean an individual, a corporation, a partnership, an association,
a trust or other entity or organization, including a government or political
subdivision or an agency or instrumentality thereof.
"PRINCIPAL MARKET" shall mean any of the national exchanges (i.e. NYSE, NYSE
AMEX, Nasdaq), or principal quotation systems (i.e. OTCQX, OTCQB, OTCPink), or
other principal exchange or recognized quotation system which is at the time the
principal trading platform or market for the Common Stock.
"PURCHASE PRICE" shall mean 70% of the Market Price on such date on which the
Purchase Price is calculated in accordance with the terms and conditions of this
Agreement.
"PUT" shall mean the right of the Company to require the Investor to purchase
shares of Common Stock, subject to the terms and conditions of this Agreement.
"PUT DATE" shall mean any Trading Day during the Commitment Period that a Put
Notice is deemed delivered pursuant to Section 2.2(b).
"PUT NOTICE" shall mean a written notice, substantially in the form of Exhibit A
hereto, to Investor setting forth the Put Shares with respect to which the
Company intends to require Investor to purchase pursuant to the terms of this
Agreement.
"PUT SHARES" shall mean all shares of Common Stock issued, or that the Company
shall be entitled to issue, per any applicable Put Notice in accordance with the
terms and conditions of this Agreement.
"REGISTERED SECURITIES" shall mean the (a) Put Shares, (b) the Commitment Shares
and (c) any securities issued or issuable with respect to any of the foregoing
by way of exchange, stock dividend or stock split or in connection with a
combination of shares, recapitalization, merger, consolidation or other
reorganization or otherwise. As to any particular Registered Securities, once
issued such securities shall cease to be Registered Securities when (i) a
Registration Statement has been declared effective by the SEC and such
Registered Securities have been disposed of pursuant to a Registration
Statement, (ii) such Registered Securities have been sold under circumstances
under which all of the applicable conditions of Rule 144 are met, (iii) such
time as such Registered Securities have been otherwise transferred to holders
who may trade such shares without restriction under the Securities Act or (iv)
in the opinion of counsel to the Company, which counsel shall be reasonably
acceptable to Investor (for which purposes it is agreed that the Company’s
counsel as of the Execution Date shall be deemed acceptable), such Registered
Securities may be sold without registration under the Securities Act or the need
for an exemption from any such registration requirements and without any time,
volume or manner limitations pursuant to Rule 144(b)(i) (or any similar
provision then in effect) under the Securities Act.
"REGISTRATION STATEMENT" shall mean the Company’s effective registration
statement on file with the SEC registering the resale of the Registered
Securities, and any follow up registration statement or amendment
thereto.
"REGULATION D" shall mean Regulation D promulgated under the Securities Act.
"RULE 144" shall mean Rule 144 promulgated under the Securities Act or any
similar provision then in force under the Securities Act.
"SEC" shall mean the United States Securities and Exchange Commission.
"SECURITIES ACT" shall have the meaning specified in the recitals of this
Agreement.
"SEC DOCUMENTS" shall mean, as of a particular date, all reports and other
documents filed by the Company pursuant to Section 13(a) or 15(d) of the
Exchange Act since the end of the Company's then most recently completed and
reported fiscal year as of the time in question (provided that if the date in
question is within ninety days of the beginning of the Company's fiscal year,
the term shall include all documents filed since the beginning of the preceding
fiscal year).
“SHORT SALES” shall mean all “short sales” as defined in Rule 200 of Regulation
SHO under the Exchange Act.
"THIRD PARTY CLAIM" shall have the meaning specified in Section 9.3(a).
“TRADING DAY” shall mean a day on which the Principal Market shall be open for
business.
“TRANSACTION DOCUMENTS” shall mean this Agreement and the Registration Rights
Agreement.
"VALUATION PERIOD" shall mean the period of five (5) Trading Days immediately
following the Clearing Date associated with the applicable Put Notice during
which the Purchase Price of the Common Stock is valued. Investor shall notify
the Company in writing of the occurrence of the Clearing Date associated with a
Put Notice. The Valuation Period shall begin the first Trading Day following
such written notice from Investor.
ARTICLE II
PURCHASE AND SALE OF COMMON STOCK
Section 2.1 INVESTMENTS.
(a) PUTS. Upon the terms and conditions set forth herein (including,
without limitation, the provisions of Article VII), on any Put Date the Company
may exercise a Put by the delivery of a Put Notice.
(b) COMMITMENT SHARES. As a condition for the execution of this Agreement by the
Investor, the Company shall issue to the Investor 150,000 shares of Common Stock
on the Execution Date.
Section 2.2 MECHANICS.
(a) PUT NOTICE. At any time and from time to time during the
Commitment Period, the Company may deliver a Put Notice to Investor, subject to
the conditions set forth in Section 7.2. On the Put Date the Company shall
deliver to Investor’s brokerage account the Put Shares referenced in the Put
Notice.
(b) DATE OF DELIVERY OF PUT NOTICE. A Put Notice shall be deemed
delivered on (i) the Trading Day it is received by email by Investor if such
notice is received on or prior to 09:00 New York time, or (ii) the immediately
succeeding Trading Day if it is received by email after 09:00 New York time on a
Trading Day or at any time on a day which is not a Trading Day. The Valuation
Period will commence on the Clearing Date.
Section 2.3 CLOSINGS. At the end of the Valuation Period the Purchase
Price shall be established; if the value of the Put Shares initially delivered
to Investor is greater than the Maximum Commitment Amount then immediately after
the Valuation Period the Investor shall deliver to Company the Put Shares
surplus associated with such Put. The Closing of a Put shall occur upon the
first Trading Day following the completion of the Valuation Period, whereby
Investor shall deliver the Investment Amount, by wire transfer of immediately
available funds to an account designated by the Company. In addition, on or
prior to such Closing Date, each of the Company and Investor shall deliver to
each other all documents, instruments and writings required to be delivered or
reasonably requested by either of them pursuant to this Agreement in order to
implement and effect the transactions contemplated herein.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF INVESTOR
Investor represents and warrants to the Company that:
Section 3.1 INTENT. Investor is entering into this Agreement for its
own account and Investor has no present arrangement (whether or not legally
binding) at any time to sell the Registered Securities to or through any person
or entity; provided, however, that Investor reserves the right to dispose of the
Registered Securities at any time in accordance with federal and state
securities laws applicable to such disposition.
Section 3.2 NO LEGAL ADVICE FROM THE COMPANY. The Investor
acknowledges that it has had the opportunity to review this Agreement and the
transactions contemplated by this Agreement with its own legal counsel and
investment and tax advisors. The Investor is relying solely on such counsel and
advisors and not on any statements or representations of the Company or any of
its representatives or agents for legal, tax or investment advice with respect
to this investment, the transactions contemplated by this Agreement or the
securities laws of any jurisdiction.
Section 3.3 SOPHISTICATED/ACCREDITED INVESTOR. Investor is a
sophisticated investor (as described in Rule 506(b)(2)(ii) of Regulation D) and
an accredited investor (as defined in Rule 501 of Regulation D), and Investor
has such experience in business and financial matters that it is capable of
evaluating the merits and risks of an investment in the Registered Securities.
Investor acknowledges that an investment in the Registered Securities is
speculative and involves a high degree of risk.
Section 3.4 AUTHORITY. (a) Investor has the requisite power and
authority to enter into and perform its obligations under this Agreement and the
transactions contemplated hereby in accordance with its terms; (b) the execution
and delivery of this Agreement and the consummation by it of the transactions
contemplated hereby and thereby have been duly authorized by all necessary
action and no further consent or authorization of Investor or its partners is
required; and (c) this Agreement has been duly authorized and validly executed
and delivered by Investor and constitutes a valid and binding obligation of
Investor enforceable against it in accordance with its terms, subject to
applicable bankruptcy, insolvency, or similar laws relating to, or affecting
generally the enforcement of, creditors' rights and remedies or by other
equitable principles of general application.
Section 3.6 ORGANIZATION AND STANDING. Investor is a limited liability
company duly organized, validly existing and in good standing under the laws of
the State of Delaware and has all requisite power and authority to own, lease
and operate its properties and to carry on its business as now being conducted.
Investor is duly qualified and in good standing in every jurisdiction in which
the nature of the business conducted or property owned by it makes such
qualification necessary, other than those in which the failure so to qualify
would not have a material adverse effect on Investor.
Section 3.8 DISCLOSURE; ACCESS TO INFORMATION. Investor had an
opportunity to review copies of the SEC Documents filed on behalf of the Company
and has had access to all publicly available information with respect to the
Company.
Section 3.9 MANNER OF SALE. At no time was Investor presented with or
solicited by or through any leaflet, public promotional meeting, television
advertisement or any other form of general solicitation or advertising.
Section 3.10 Estimates; Forward-Looking Statements. The Investor
acknowledges that any and all estimates or forward-looking statements or
projections with which it may have been provided (collectively, the
“Information”) were prepared by the Company in good faith, but that the
attainment of any such projections, estimates or forward-looking statements
cannot be guaranteed, will not be updated by the Company and should not be
relied upon. The Investor further acknowledges that any and all Information
regarding the historical performance of the Company is not necessarily
indicative of future performance.
Section 3.11 Trading Activities; No Short Sales. Neither the
Investor nor any of its affiliates currently has an open short position in the
Common Stock. Since the earlier of (a) such time when such Investor was first
contacted by the Company or any other person acting on behalf of the Company
regarding the transactions contemplated hereby or (b) thirty (30) days prior to
the date hereof, neither such Investor nor any affiliate of such Investor which
(x) had knowledge of the transactions contemplated hereby, (y) has or shares
discretion relating to such Investor’s investments or trading or information
concerning such Investor’s investments, including in respect of the Registered
Securities, or (z) is subject to such Investor’s review or input concerning such
affiliate’s investments or trading (collectively, “Trading Affiliates”) has,
directly or indirectly, effected or agreed to effect any Short Sale, whether or
not against the box, established any “put equivalent position” (as defined in
Rule 16a-1(h) under the Exchange Act) with respect to the Common Stock, granted
any other right (including, without limitation, any put or call option) with
respect to the Common Stock or with respect to any security that includes,
relates to or derived any significant part of its value from the Common Stock or
otherwise sought to hedge its position in the Registered Securities.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents and warrants to Investor that, except as disclosed in the
SEC Documents:
Section 4.1 ORGANIZATION OF THE COMPANY. The Company is a corporation
duly organized and validly existing and in good standing under the laws of the
State of Delaware and has all requisite power and authority to own, lease and
operate its properties and to carry on its business as now being conducted. The
Company is duly qualified as a foreign corporation to do business and is in good
standing in every jurisdiction in which the nature of the business conducted or
property owned by it makes such qualification necessary, other than those in
which the failure so to qualify would not have a Material Adverse Effect.
Section 4.2 AUTHORITY. (a) The Company has the requisite corporate
power and authority to enter into and perform its obligations under this
Agreement and to issue the Put Shares; (b) the execution and delivery of this
Agreement by the Company and the consummation by it of the transactions
contemplated hereby and thereby have been duly authorized by all necessary
corporate action and no further consent or authorization of the Company or its
Board of Directors or stockholders is required; and (c) this Agreement has been
duly executed and delivered by the Company and constitutes a valid and binding
obligation of the Company enforceable against the Company in accordance with its
terms, except as such enforceability may be limited by applicable bankruptcy,
insolvency, or similar laws relating to, or affecting generally the enforcement
of, creditors' rights and remedies or by other equitable principles of general
application.
Section 4.3 CAPITALIZATION. As of the date hereof, the authorized capital stock
of the Company consists of 490,000,000 shares of Common Stock, $0.0001 par value
per share, of which 18,624,461 shares were issued and outstanding as of March
31, 2016 and 10,000,000 shares of preferred stock, $0.0001 par value per share,
of which no shares were issued and outstanding as of March 31, 2016. Except as
set forth on Schedule 4.3, there are no outstanding securities which are
convertible into shares of Common Stock, whether such conversion is currently
exercisable or exercisable only upon some future date or the occurrence of some
event in the future. All of the outstanding shares of Common Stock of the
Company have been duly and validly authorized and issued and are fully paid and
non-assessable.
Section 4.4 COMMON STOCK. To the best of its knowledge, the Company is
in full compliance with all reporting requirements of the Exchange Act, and the
Company has maintained all requirements for the continued listing or quotation
of the Common Stock, and such Common Stock is currently listed or quoted on the
Principal Market which is presently the OTCQB.
Section 4.5 SEC DOCUMENTS. The Company may make available to Investor
true and complete copies of the SEC Documents (including, without limitation,
proxy information and solicitation materials). To the Company’s knowledge, the
Company has not provided to Investor any information that, according to
applicable law, rule or regulation, should have been disclosed publicly prior to
the date hereof by the Company, but which has not been so disclosed. As of their
respective dates, the SEC Documents complied in all material respects with the
requirements of the Exchange Act, and other federal laws, rules and regulations
applicable to such SEC Documents, and none of the 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
light of the circumstances under which they were made, not misleading. The
financial statements of the Company included in the SEC Documents comply as to
form and substance in all material respects with applicable accounting
requirements and the published rules and regulations of the SEC or other
applicable rules and regulations with respect thereto. Such financial statements
have been prepared in accordance with generally accepted accounting principles
applied on a consistent basis during the periods involved (except (a) as may be
otherwise indicated in such financial statements or the notes thereto or (b) in
the case of unaudited interim statements, to the extent they may not include
footnotes or may be condensed or summary statements) and fairly present in all
material respects the financial position of the Company as of the dates thereof
and the results of operations and cash flows for the periods then ended
(subject, in the case of unaudited statements, to normal year-end audit
adjustments).
Section 4.6 VALID ISSUANCES. When issued and paid for as herein
provided, the Put Shares shall be duly and validly issued, fully paid, and
non-assessable. The sales of the Put Shares pursuant to this Agreement, and the
Company's performance of its obligations hereunder, shall not (a) result in the
creation or imposition of any liens, charges, claims or other encumbrances upon
the Put Shares, or any of the assets of the Company, or (b) entitle the holders
of outstanding shares of Common Stock to preemptive or other rights to subscribe
to or acquire the Common Stock or other securities of the Company. The Put
Shares shall not subject Investor to personal liability, in excess of the
subscription price by reason of the ownership thereof.
Section 4.7 NO CONFLICTS. The execution, delivery and performance of
this Agreement by the Company and the consummation by the Company of the
transactions contemplated hereby, including without limitation the issuance of
the Put Shares, do not and will not (a) result in a violation of the Company’s
Certificate of Incorporation or By-Laws or (b) conflict with, or constitute a
material default (or an event that with notice or lapse of time or both would
become a material default) under, or give to others any rights of termination,
amendment, acceleration or cancellation of, any material agreement, indenture,
instrument or any "lock-up" or similar provision of any underwriting or similar
agreement to which the Company is a party, or (c) result in a violation of any
federal, state or local law, rule, regulation, order, judgment or decree
(including federal and state securities laws and regulations) applicable to the
Company or by which any property or asset of the Company is bound or affected
(except for such conflicts, defaults, terminations, amendments, accelerations,
cancellations and violations as would not, individually or in the aggregate,
have a Material Adverse Effect) nor is the Company otherwise materially in
violation of, conflict with or in default under any of the foregoing. The
business of the Company is not being conducted in violation of any law,
ordinance or regulation of any governmental entity, except for possible
violations that either singly or in the aggregate do not and will not have a
Material Adverse Effect. The Company is not required under federal, state or
local law, rule or regulation to obtain any consent, authorization or order of,
or make any filing or registration with, any court or governmental agency in
order for it to execute, deliver or perform any of its obligations under this
Agreement or issue and sell the Common Stock in accordance with the terms hereof
(other than any SEC, FINRA or state securities filings that may be required to
be made by the Company subsequent to any Closing, or any registration statement
that may be filed pursuant hereto); provided that, for purposes of the
representation made in this sentence, the Company is assuming and relying upon
the accuracy of the relevant representations and agreements of Investor herein.
Section 4.8 NO MATERIAL ADVERSE CHANGE. Since March 31, 2016 no event
has occurred that would have a Material Adverse Effect on the Company.
Section 4.9 LITIGATION AND OTHER PROCEEDINGS. Except as disclosed in
the Company’s SEC filings, there are no lawsuits or proceedings pending or to
the knowledge of the Company threatened, against the Company, nor has the
Company received any written or oral notice of any such action, suit, proceeding
or investigation, which would have a Material Adverse Effect. No judgment,
order, writ, injunction or decree or award has been issued by or, so far as is
known by the Company, requested of any court, arbitrator or governmental agency
which would have a Material Adverse Effect.
Section 4.10 DILUTION. The number of shares of Common Stock issuable as
Put Shares may increase substantially in certain circumstances, including, but
not necessarily limited to, the circumstance wherein the trading price of the
Common Stock declines during the period between the Execution Date and the end
of the Commitment Period. The Company’s executive officers and directors have
studied and fully understand the nature of the transactions contemplated by this
Agreement and recognize that they have a potential dilutive effect. The board of
directors of the Company has concluded in its good faith business judgment that
such issuance is in the best interests of the Company. The Company specifically
acknowledges that its obligation to issue the Put Shares is binding upon the
Company and enforceable regardless of the dilution such issuance may have on the
ownership interests of other shareholders of the Company.
ARTICLE V
COVENANTS OF INVESTOR
Section 5.1 COMPLIANCE WITH LAW; TRADING IN SECURITIES. Investor's
trading activities with respect to shares of the Common Stock will be in
compliance with all applicable state and federal securities laws, rules and
regulations and the rules and regulations of FINRA and the Principal Market on
which the Common Stock is listed or quoted.
Section 5.2 SHORT SALES AND CONFIDENTIALITY. Neither Investor nor any
trading affiliate will execute any Short Sales during the period from the date
hereof to the end of the Commitment Period. For the purposes hereof, and in
accordance with Regulation SHO, the sale after delivery of a Put Notice of such
number of shares of Common Stock reasonably expected to be purchased under a Put
Notice shall not be deemed a Short Sale.
Other than to other Persons party to this Agreement, Investor has maintained the
confidentiality of all disclosures made to it in connection with this
transaction (including the existence and terms of this transaction).
ARTICLE VI
COVENANTS OF THE COMPANY
Section 6.1 RESERVATION OF COMMON STOCK. The Company will, from time
to time as needed in advance of a Closing Date, reserve and keep available until
the consummation of such Closing, free of preemptive rights sufficient shares of
Common Stock for the purpose of enabling the Company to satisfy its obligation
to issue the Put Shares to be issued in connection therewith. The number of
shares so reserved from time to time, as theretofore increased or reduced as
hereinafter provided, may be reduced by the number of shares actually delivered
hereunder.
Section 6.2 LISTING OF COMMON STOCK. If the Company applies to have
the Common Stock traded on any other Principal Market, it shall include in such
application the Put Shares, and shall take such other action as is necessary or
desirable in the reasonable opinion of Investor to cause the Common Stock to be
listed on such other Principal Market as promptly as possible. The Company shall
use its commercially reasonable efforts to continue the listing and trading of
the Common Stock on the Principal Market (including, without limitation,
maintaining sufficient net tangible assets) and will comply in all respects with
the Company's reporting, filing and other obligations under the bylaws or rules
of the FINRA and the Principal Market.
Section 6.3 CERTAIN AGREEMENTS. So long as this Agreement remains in
effect, the Company covenants and agrees that it will not, without the prior
written consent of the Investor, enter into any equity line of credit agreements
with a third party during the Commitment Period having terms and conditions
substantially comparable to this Agreement. For the avoidance of doubt, nothing
contained in the Transaction Documents shall restrict, or require the Investor's
consent for, any agreement providing for the issuance or distribution of (or the
issuance or distribution of) any equity securities pursuant to any agreement or
arrangement that is not commonly understood to be an "equity line of credit."
ARTICLE VII
CONDITIONS TO DELIVERY OF
PUT NOTICES AND CONDITIONS TO CLOSING
Section 7.1 CONDITIONS PRECEDENT TO THE OBLIGATION OF THE COMPANY TO
ISSUE AND SELL COMMON STOCK. The obligation hereunder of the Company to issue
and sell the Put Shares to Investor is subject to the satisfaction of each of
the conditions set forth below.
(a) ACCURACY OF INVESTOR'S REPRESENTATIONS AND WARRANTIES. The representations
and warranties of Investor shall be true and correct in all material respects as
of the date of this Agreement and as of the date of each such Closing as though
made at each such time.
(b) PERFORMANCE BY INVESTOR. Investor shall have performed, satisfied
and complied in all respects with all covenants, agreements and conditions
required by this Agreement to be performed, satisfied or complied with by
Investor at or prior to such Closing.
Section 7.2 CONDITIONS PRECEDENT TO THE RIGHT OF THE COMPANY TO
DELIVER A PUT NOTICE AND THE OBLIGATION OF INVESTOR TO PURCHASE PUT SHARES. The
right of the Company to deliver a Put Notice and the obligation of Investor
hereunder to acquire and pay for the Put Shares is subject to the satisfaction
of each of the following conditions:
(a) EFFECTIVE REGISTRATION STATEMENT. The Registration Statement, and
any amendment or supplement thereto, shall remain effective for the sale by
Investor of the Registered Securities subject to such Put Notice, and (i)
neither the Company nor Investor shall have received notice that the SEC has
issued or intends to issue a stop order with respect to such Registration
Statement or that the SEC otherwise has suspended or withdrawn the effectiveness
of such Registration Statement, either temporarily or permanently, or intends or
has threatened to do so and (ii) no other suspension of the use or withdrawal of
the effectiveness of such Registration Statement or related prospectus shall
exist.
(b) ACCURACY OF THE COMPANY'S REPRESENTATIONS AND WARRANTIES. The
representations and warranties of the Company shall be true and correct in all
material respects (except for representations and warranties specifically made
as of a particular date), except for any conditions which have temporarily
caused any representations or warranties herein to be incorrect and which have
been corrected with no continuing impairment to the Company or Investor.
(c) PERFORMANCE BY THE COMPANY. The Company shall have performed,
satisfied and complied in all material respects with all covenants, agreements
and conditions required by this Agreement to be performed, satisfied or complied
with by the Company.
(d) NO INJUNCTION. No statute, rule, regulation, executive order,
decree, ruling or injunction shall have been enacted, entered, promulgated or
adopted by any court or governmental authority of competent jurisdiction that
prohibits or directly and materially adversely affects any of the transactions
contemplated by this Agreement, and no proceeding shall have been commenced that
may have the effect of prohibiting or materially adversely affecting any of the
transactions contemplated by this Agreement.
(e) ADVERSE CHANGES. Since the date of filing of the Company's most
recent SEC Document, no event that had or is reasonably likely to have a
Material Adverse Effect has occurred.
(f) NO SUSPENSION OF TRADING IN OR DELISTING OF COMMON STOCK. The
trading of the Common Stock shall not have been suspended by the SEC, the
Principal Market or the FINRA and the Common Stock shall have been approved for
listing or quotation on and shall not have been delisted from the Principal
Market.
(g) TEN PERCENT LIMITATION. On each Closing Date, the number of Put
Shares then to be purchased by Investor shall not exceed the number of such
shares that, when aggregated with all other shares of Common Stock then owned by
Investor beneficially or deemed beneficially owned by Investor, would result in
Investor owning more than 9.99% of all of such Common Stock as would be
outstanding on such Closing Date, as determined in accordance with Section 16 of
the Exchange Act and the regulations promulgated thereunder. For purposes of
this Section, in the event that the amount of Common Stock outstanding as
determined in accordance with Section 16 of the Exchange Act and the regulations
promulgated thereunder is greater on a Closing Date than on the date upon which
the Put Notice associated with such Closing Date is given, the amount of Common
Stock outstanding on such Closing Date shall govern for purposes of determining
whether Investor, when aggregating all purchases of Common Stock made pursuant
to this Agreement, would own more than 9.99% of the Common Stock following such
Closing Date.
(h) NO KNOWLEDGE. The Company shall have no knowledge of any event more
likely than not to have the effect of causing such Registration Statement to be
suspended or otherwise ineffective (which event is more likely than not to occur
within the fifteen (15) Trading Days following the Trading Day on which such Put
Notice is deemed delivered).
(i) OTHER. On the date of delivery of each Put Notice, Investor shall
have received a certificate in substantially the form and substance of Exhibit B
hereto, executed by an executive officer of the Company and to the effect that
all the conditions to such Closing shall have been satisfied as at the date of
each such certificate.
ARTICLE VIII
LEGENDS
Section 8.1 PUT SHARES. No legend shall be placed on the share
certificates representing the Put Shares.
Section 8.2 COMMITMENT SHARES. Certificates evidencing the Commitment
Shares shall not contain a legend (i) while a registration statement covering
the resale of such security is effective under the Securities Act, (ii)
following any sale of such Commitment Shares pursuant to Rule 144, or (iii) if
such legend is not required under applicable requirements of the Securities Act
(including judicial interpretations and pronouncements issued by the staff of
the SEC).
Section 8.3 INVESTOR'S COMPLIANCE. Nothing in this Article VIII shall
affect in any way Investor's obligations under any agreement to comply with all
applicable securities laws upon the sale of the Common Stock.
ARTICLE IX
NOTICES; INDEMNIFICATION
Section 9.1 NOTICES. Any and all notices or other communications or
deliveries to be provided by the Investor hereunder shall be in writing and
delivered personally, by facsimile, by email attachment, or sent by a nationally
recognized overnight courier service, addressed to the Company, at the address
set forth below, or such other facsimile number, email address, or address as
the Company may specify for such purposes by notice to the Holder delivered in
accordance with this Section 9.1. Any and all notices or other communications or
deliveries to be provided by the Company hereunder shall be in writing and
delivered personally, by facsimile, by email attachment, or sent by a nationally
recognized overnight courier service addressed to the Investor at the facsimile
number or email address or address of the Investor set forth below. Any notice
or other communication or deliveries hereunder shall be deemed given and
effective on the earliest of (i) the date of transmission, if such notice or
communication is delivered via facsimile at the facsimile number or email
attachment to the email address set forth on the signature pages attached hereto
prior to 5:30 p.m. (New York City time) on any date, (ii) the next Trading Day
after the date of transmission, if such notice or communication is delivered via
facsimile at the facsimile number or email attachment to the email address set
forth on the signature pages attached hereto on a day that is not a Trading Day
or later than 5:30 p.m. (New York City time) on any Trading Day, (iii) the
second Trading Day following the date of mailing, if sent by U.S. nationally
recognized overnight courier service or (iv) upon actual receipt by the party to
whom such notice is required to be given. The addresses for such communications
shall be:
If to the Company:
Emerald Medical Applications Corp.
7 Imber Street
Petach Tikva 4951141 Israel
Attn: Lior Wayn, CEO
Email: lior@dermacompare.com
with a copy to:
Office of Richard Rubin
40 Wall Street, 28th Floor
New York, NY 10005
Attn: Richard Rubin, Esq.
Email: rrubin@parkavenuegroup.us
If to the Investor:
Kodiak Capital Group, LLC
260 Newport Center Drive
Newport Beach, CA 92660
info@kodiakfunds.com
Either party hereto may from time to time change its address or email for
notices under this Section 9.1 by giving at least ten (10) days' prior written
notice of such changed address to the other party hereto.
Section 9.2 INDEMNIFICATION. Each party (an “Indemnifying Party”)
agrees to indemnify and hold harmless the other party along with its officers,
directors, employees, and authorized agents, and each Person or entity, if any,
who controls such party within the meaning of Section 15 of the Securities Act
or Section 20 of the Exchange Act (an “Indemnified Party”) from and against any
Damages, joint or several, and any action in respect thereof to which the
Indemnified Party becomes subject to, resulting from, arising out of or relating
to (i) any misrepresentation, breach of warranty or nonfulfillment of or failure
to perform any covenant or agreement on the part of Indemnifying Party contained
in this Agreement, (ii) any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement or any post-effective
amendment thereof or supplement thereto, or the omission or alleged omission
therefrom of a material fact required to be stated therein or necessary to make
the statements therein not misleading, (iii) any untrue statement or alleged
untrue statement of a material fact contained in any preliminary prospectus or
contained in the final prospectus (as amended or supplemented, if the Company
files any amendment thereof or supplement thereto with the SEC) or the omission
or alleged omission to state therein any material fact necessary to make the
statements made therein, in the light of the circumstances under which the
statements therein were made, not misleading, or (iv) any violation or alleged
violation by the Company of the Securities Act, the Exchange Act, any state
securities law or any rule or regulation under the Securities Act, the Exchange
Act or any state securities law, as such Damages are incurred, except to the
extent such Damages result primarily from Indemnified Party's failure to perform
any covenant or agreement contained in this Agreement or Indemnified Party's
negligence, recklessness or bad faith in performing its obligations under this
Agreement; provided, however, that the foregoing indemnity agreement shall not
apply to any Damages of an Indemnified Party to the extent, but only to the
extent, arising out of or based upon any untrue statement or alleged untrue
statement or omission or alleged omission made by an Indemnifying Party in
reliance upon and in conformity with written information furnished to the
Indemnifying Party by the Indemnified Party expressly for use in the
Registration Statement, any post-effective amendment thereof or supplement
thereto, or any preliminary prospectus or final prospectus (as amended or
supplemented).
Section 9.3 METHOD OF ASSERTING INDEMNIFICATION CLAIMS. All claims for
indemnification by any Indemnified Party (as defined below) under Section 9.2
shall be asserted and resolved as follows:
(a) In the event any claim or demand in respect of which an Indemnified
Party might seek indemnity under Section 9.2 is asserted against or sought to be
collected from such Indemnified Party by a person other than a party hereto or
an affiliate thereof (a "THIRD PARTY CLAIM"), the Indemnified Party shall
deliver a written notification, enclosing a copy of all papers served, if any,
and specifying the nature of and basis for such Third Party Claim and for the
Indemnified Party's claim for indemnification that is being asserted under any
provision of Section 9.2 against an Indemnifying Party, together with the amount
or, if not then reasonably ascertainable, the estimated amount, determined in
good faith, of such Third Party Claim (a "CLAIM NOTICE") with reasonable
promptness to the Indemnifying Party. If the Indemnified Party fails to provide
the Claim Notice with reasonable promptness after the Indemnified Party receives
notice of such Third Party Claim, the Indemnifying Party shall not be obligated
to indemnify the Indemnified Party with respect to such Third Party Claim to the
extent that the Indemnifying Party's ability to defend has been prejudiced by
such failure of the Indemnified Party. The Indemnifying Party shall notify the
Indemnified Party as soon as practicable within the period ending thirty (30)
calendar days following receipt by the Indemnifying Party of either a Claim
Notice or an Indemnity Notice (as defined below) (the "DISPUTE PERIOD") whether
the Indemnifying Party disputes its liability or the amount of its liability to
the Indemnified Party under Section 9.2 and whether the Indemnifying Party
desires, at its sole cost and expense, to defend the Indemnified Party against
such Third Party Claim.
(i) If the Indemnifying Party notifies the Indemnified Party within the
Dispute Period that the Indemnifying Party desires to defend the Indemnified
Party with respect to the Third Party Claim pursuant to this Section 9.3(a),
then the Indemnifying Party shall have the right to defend, with counsel
reasonably satisfactory to the Indemnified Party, at the sole cost and expense
of the Indemnifying Party, such Third Party Claim by all appropriate
proceedings, which proceedings shall be vigorously and diligently prosecuted by
the Indemnifying Party to a final conclusion or will be settled at the
discretion of the Indemnifying Party (but only with the consent of the
Indemnified Party in the case of any settlement that provides for any relief
other than the payment of monetary damages or that provides for the payment of
monetary damages as to which the Indemnified Party shall not be indemnified in
full pursuant to Section 9.2). The Indemnifying Party shall have full control of
such defense and proceedings, including any compromise or settlement thereof;
provided, however, that the Indemnified Party may, at the sole cost and expense
of the Indemnified Party, at any time prior to the Indemnifying Party's delivery
of the notice referred to in the first sentence of this clause (i), file any
motion, answer or other pleadings or take any other action that the Indemnified
Party reasonably believes to be necessary or appropriate to protect its
interests; and provided further, that if requested by the Indemnifying Party,
the Indemnified Party will, at the sole cost and expense of the Indemnifying
Party, provide reasonable cooperation to the Indemnifying Party in contesting
any Third Party Claim that the Indemnifying Party elects to contest. The
Indemnified Party may participate in, but not control, any defense or settlement
of any Third Party Claim controlled by the Indemnifying Party pursuant to this
clause (i), and except as provided in the preceding sentence, the Indemnified
Party shall bear its own costs and expenses with respect to such participation.
Notwithstanding the foregoing, the Indemnified Party may takeover the control of
the defense or settlement of a Third Party Claim at any time if it irrevocably
waives its right to indemnity under Section 9.2 with respect to such Third Party
Claim.
(ii) If the Indemnifying Party fails to notify the Indemnified Party
within the Dispute Period that the Indemnifying Party desires to defend the
Third Party Claim pursuant to Section 9.3(a), or if the Indemnifying Party gives
such notice but fails to prosecute vigorously and diligently or settle the Third
Party Claim, or if the Indemnifying Party fails to give any notice whatsoever
within the Dispute Period, then the Indemnified Party shall have the right to
defend, at the sole cost and expense of the Indemnifying Party, the Third Party
Claim by all appropriate proceedings, which proceedings shall be prosecuted by
the Indemnified Party in a reasonable manner and in good faith or will be
settled at the discretion of the Indemnified Party(with the consent of the
Indemnifying Party, which consent will not be unreasonably withheld). The
Indemnified Party will have full control of such defense and proceedings,
including any compromise or settlement thereof; provided, however, that if
requested by the Indemnified Party, the Indemnifying Party will, at the sole
cost and expense of the Indemnifying Party, provide reasonable cooperation to
the Indemnified Party and its counsel in contesting any Third Party Claim which
the Indemnified Party is contesting. Notwithstanding the foregoing provisions of
this clause (ii), if the Indemnifying Party has notified the Indemnified Party
within the Dispute Period that the Indemnifying Party disputes its liability or
the amount of its liability hereunder to the Indemnified Party with respect to
such Third Party Claim and if such dispute is resolved in favor of the
Indemnifying Party in the manner provided in clause (iii) below, the
Indemnifying Party will not be required to bear the costs and expenses of the
Indemnified Party's defense pursuant to this clause (ii) or of the Indemnifying
Party's participation therein at the Indemnified Party's request, and the
Indemnified Party shall reimburse the Indemnifying Party in full for all
reasonable costs and expenses incurred by the Indemnifying Party in connection
with such litigation. The Indemnifying Party may participate in, but not
control, any defense or settlement controlled by the Indemnified Party pursuant
to this clause (ii), and the Indemnifying Party shall bear its own costs and
expenses with respect to such participation.
(iii) If the Indemnifying Party notifies the Indemnified Party that it
does not dispute its liability or the amount of its liability to the Indemnified
Party with respect to the Third Party Claim under Section 9.2 or fails to notify
the Indemnified Party within the Dispute Period whether the Indemnifying Party
disputes its liability or the amount of its liability to the Indemnified Party
with respect to such Third Party Claim, the amount of Damages specified in the
Claim Notice shall be conclusively deemed a liability of the Indemnifying Party
under Section 9.2 and the Indemnifying Party shall pay the amount of such
Damages to the Indemnified Party on demand. If the Indemnifying Party has timely
disputed its liability or the amount of its liability with respect to such
claim, the Indemnifying Party and the Indemnified Party shall proceed in good
faith to negotiate a resolution of such dispute; provided, however, that if the
dispute is not resolved within thirty (30) days after the Claim Notice, the
Indemnifying Party shall be entitled to institute such legal action as it deems
appropriate.
(b) In the event any Indemnified Party should have a claim under
Section 9.2 against the Indemnifying Party that does not involve a Third Party
Claim, the Indemnified Party shall deliver a written notification of a claim for
indemnity under Section 9.2 specifying the nature of and basis for such claim,
together with the amount or, if not then reasonably ascertainable, the estimated
amount, determined in good faith, of such claim (an "INDEMNITY NOTICE") with
reasonable promptness to the Indemnifying Party. The failure by any Indemnified
Party to give the Indemnity Notice shall not impair such party's rights
hereunder except to the extent that the Indemnifying Party demonstrates that it
has been irreparably prejudiced thereby. If the Indemnifying Party notifies the
Indemnified Party that it does not dispute the claim or the amount of the claim
described in such Indemnity Notice or fails to notify the Indemnified Party
within the Dispute Period whether the Indemnifying Party disputes the claim or
the amount of the claim described in such Indemnity Notice, the amount of
Damages specified in the Indemnity Notice will be conclusively deemed a
liability of the Indemnifying Party under Section 9.2 and the Indemnifying Party
shall pay the amount of such Damages to the Indemnified Party on demand. If the
Indemnifying Party has timely disputed its liability or the amount of its
liability with respect to such claim, the Indemnifying Party and the Indemnified
Party shall proceed in good faith to negotiate a resolution of such dispute;
provided, however, that if the dispute is not resolved within thirty (30) days
after the Claim Notice, the Indemnifying Party shall be entitled to institute
such legal action as it deems appropriate.
(c) The Indemnifying Party agrees to pay the Indemnified Party,
promptly as such expenses are incurred and are due and payable, for any
reasonable legal fees or other reasonable expenses incurred by them in
connection with investigating or defending any such Claim.
(d) The indemnity provisions contained herein shall be in addition to
(i) any cause of action or similar rights of the Indemnified Party against the
Indemnifying Party or others, and (ii) any liabilities the Indemnifying Party
may be subject to.
ARTICLE X
MISCELLANEOUS
Section 10.1 GOVERNING LAW; JURISDICTION. This Agreement and all acts
and transactions pursuant hereto and the rights and obligations of the Company
and the Investor shall be governed, construed and interpreted in accordance with
the laws of the State of California without giving effect to principles of
conflicts of law. Each of the Company and Investor hereby submit to the
exclusive jurisdiction of the United States Federal and state courts located in
California with respect to the adjudication of any dispute hereunder or in
connection herewith or with any transaction contemplated hereby or discussed
herein.
Section 10.2 JURY TRIAL WAIVER. The Company and the Investor hereby
waive a trial by jury in any action, proceeding or counterclaim brought by
either of the parties hereto against the other in respect of any matter arising
out of or in connection with the Transaction Documents.
Section 10.3 ASSIGNMENT. This Agreement shall be binding upon and inure
to the benefit of the Company and Investor and their respective successors.
Neither this Agreement nor any rights of Investor or the Company hereunder may
be assigned by either party to any other person.
Section 10.4 THIRD PARTY BENEFICIARIES. This Agreement is intended for
the benefit of the Company and Investor and their respective successors, and is
not for the benefit of, nor may any provision hereof be enforced by, any other
person.
Section 10.5 TERMINATION. The Company may terminate this Agreement at
any time by written notice to the Investor. Additionally, this Agreement shall
terminate at the end of Commitment Period or as otherwise provided herein;
provided, however, that the provisions of Articles IX, and Sections 10.1 and
10.2 shall survive the termination of this Agreement for a period of twenty four
(24) months.
Section 10.6 ENTIRE AGREEMENT, AMENDMENT; NO WAIVER. This Agreement and
the instruments referenced herein contain the entire understanding of the
Company and Investor with respect to the matters covered herein and therein and,
except as specifically set forth herein or therein, neither the Company nor
Investor makes any representation, warranty, covenant or undertaking with
respect to such matters. No provision of this Agreement may be waived or amended
other than by an instrument in writing signed by the party to be charged with
enforcement.
Section 10.7 FEES AND EXPENSES. The Company agrees to pay its own
expenses in connection with the preparation of this Agreement and performance of
its obligations hereunder. The Company shall pay all stamp or other similar
taxes and duties levied in connection with issuance of the Put Shares pursuant
hereto.
Section 10.8 COUNTERPARTS. This Agreement may be executed in multiple
counterparts, each of which may be executed by less than all of the parties and
shall be deemed to be an original instrument which shall be enforceable against
the parties actually executing such counterparts and all of which together shall
constitute one and the same instrument. This Agreement may be delivered to the
other parties hereto by email of a copy of this Agreement bearing the signature
of the parties so delivering this Agreement.
Section 10.9 SEVERABILITY. In the event that any provision of this
Agreement becomes or is declared by a court of competent jurisdiction to be
illegal, unenforceable or void, this Agreement shall continue in full force and
effect without said provision; provided that such severability shall be
ineffective if it materially changes the economic benefit of this Agreement to
any party.
Section 10.10 FURTHER ASSURANCES. Each party shall do and perform, or
cause to be done and performed, all such further acts and things, and shall
execute and deliver all such other agreements, certificates, instruments and
documents, as the other party may reasonably request in order to carry out the
intent and accomplish the purposes of this Agreement and the consummation of the
transactions contemplated hereby.
Section 10.11 NO STRICT CONSTRUCTION. The language used in this
Agreement will be deemed to be the language chosen by the parties to express
their mutual intent, and no rules of strict construction will be applied against
any party.
Section 10.12 EQUITABLE RELIEF. The Company recognizes that in the event
that it fails to perform, observe, or discharge any or all of its obligations
under this Agreement, any remedy at law may prove to be inadequate relief to
Investor. The Company therefore agrees that Investor shall be entitled to
temporary and permanent injunctive relief in any such case without the necessity
of proving actual damages.
Section 10.13 TITLE AND SUBTITLES. The titles and subtitles used in this
Agreement are used for the convenience of reference and are not to be considered
in construing or interpreting this Agreement.
Section 10.14 REPORTING ENTITY FOR THE COMMON STOCK. The reporting
entity relied upon for the determination of the Closing Price for the Common
Stock on any given Trading Day for the purposes of this Agreement shall be
Bloomberg Finance L.P. or any successor thereto. The written mutual consent of
Investor and the Company shall be required to employ any other reporting entity.
Section 10.15 PUBLICITY. The Company and Investor shall consult with
each other in issuing any press releases or otherwise making public statements
with respect to the transactions contemplated hereby and no party shall issue
any such press release or otherwise make any such public statement without the
prior written consent of the other parties, which consent shall not be
unreasonably withheld or delayed, except that no prior consent shall be required
if such disclosure is required by law, in which such case the disclosing party
shall provide the other parties with prior notice of such public statement.
Notwithstanding the foregoing, the Company shall not publicly disclose the name
of Investor without the prior written consent of such Investor, except to the
extent required by law. Investor acknowledges that this Agreement and all or
part of the Transaction Documents may be deemed to be "material contracts" as
that term is defined by Item 601(b)(10) of Regulation S-K, and that the Company
may therefore be required to file such documents as exhibits to reports or
registration statements filed under the Securities Act or the Exchange Act.
Investor further agrees that the status of such documents and materials as
material contracts shall be determined solely by the Company, in consultation
with its counsel.
[-Signature page follows-]
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed
by their respective officers thereunto duly authorized as of the day and year
first above written.
COMPANY:
EMERALD MEDICAL APPLICATIONS CORP.
By: /s/ Lior Wayn
Name: Lior Wayn
Title: Chief Executive Officer
INVESTOR:
KODIAK CAPITAL GROUP, LLC
By:
Name:
Title:
EXHIBIT A
FORM OF PUT NOTICE
TO: KODIAK CAPITAL GROUP, LLC
We refer to the Equity Purchase Agreement dated May 12, 2016 (the
“Agreement”) entered into by Emerald Medical Applications Corp. (the “Company”)
and you. Capitalized terms defined in the Agreement shall, unless otherwise
defined, have the same meaning when used herein.
We hereby:
1) Give you notice that we require you to purchase ______________ Put Shares;
2) Certify that, as of the date hereof, to the best of our knowledge, the
conditions set forth in Section 7.2 of the Agreement are satisfied.
Date: _____________, 2016
__________
By:
Name:
Title:
EXHIBIT B
FORM OF CERTIFICATE OF THE CHIEF EXECUTIVE OFFICER OF EMERALD MEDICAL APPLICATIONS CORP.
Pursuant to Section 7.2(j) of that certain Equity Purchase Agreement dated
May 12, 2016 (the “Agreement”) by and between the Company and KODIAK CAPITAL
GROUP, LLC (the “Investor”), the undersigned, in his capacity as the Chief
Executive Officer of EMERALD MEDICAL APPLICATIONS CORP. (the “Company”), and not
in his individual capacity, hereby certifies, as of the date hereof (such date,
the “Condition Satisfaction Date”), the following:
1. The representations and warranties of the Company are true and
correct in all material respects as of the Condition Satisfaction Date as though
made on the Condition Satisfaction Date (except for representations and
warranties specifically made as of a particular date) with respect to all
periods, and as to all events and circumstances occurring or existing to and
including the Condition Satisfaction Date, except for any conditions which have
temporarily caused any representations or warranties of the Company set forth in
the Agreement to be incorrect and which have been corrected with no continuing
impairment to the Company or Investor; and
2. All of the Company’s conditions to Closing set forth in Section 7.2
of the Agreement have been satisfied as of the Condition Satisfaction Date.
Capitalized terms used herein shall have the meanings set forth in the Agreement
unless otherwise defined herein.
IN WITNESS WHEREOF, the undersigned has hereunto affixed his hand as of the
__________ day of ____________, 2016.
By:
Name:
Title:
Exhibit 10.21
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement ("Agreement"), dated May 12, 2016, is made by and between EMERALD MEDICAL APPLICATIONS CORP., a Delaware corporation ("Company"), and KODIAK CAPITAL GROUP, LLC a Delaware limited liability company (the "Investor").
RECITALS
WHEREAS, upon the terms and subject to the conditions of the Equity Purchase
Agreement ("Purchase Agreement"), between the Investor and the Company, the
Company has agreed to issue and sell to the Investor shares (the "Put Shares")
of its common stock, $0.0001 par value per share (the "Common Stock") from time
to time for an aggregate investment price of up to One Million ($1,000,000)
Dollars (the "EPA Securities");
WHEREAS, as a condition for the execution of the Purchase Agreement by the
Investor, the Company has agreed to issue to the Investor 150,000 shares of
Common Stock (the “Commitment Shares "); and
WHEREAS, to induce the Investor to execute and deliver the Purchase Agreement,
the Company has agreed to provide certain registration rights under the
Securities Act of 1933, as amended, and the rules and regulations thereunder, or
any similar successor statute (collectively, the "Securities Act"), and
applicable state securities laws with respect to the EPA Securities, the shares
of Common Stock underlying the Commitment Shares, and any securities issued or
issuable with respect to any of the foregoing by way of exchange, stock dividend
or stock split or in connection with a combination of shares, recapitalization,
merger, consolidation or other reorganization or otherwise (together with the
EPA Securities and the Note Securities, the “Registered Securities”).
NOW, THEREFORE, in consideration of the premises and the mutual covenants
contained herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company and the Investor
hereby agree as follows:
1. Definitions.
(a) As used in this Agreement, the following terms shall have the
following meaning:
(i) "Execution Date" means the date of this Agreement.
(ii) "Investor" has the meaning set forth in the preamble to this
Agreement.
(iii) "Register," "registered" and "registration" refer to a registration
effected by preparing and filing a Registration Statement or Statements in
compliance with the Securities Act and pursuant to Rule 415 under the Securities
Act or any successor rule providing for offering securities on a delayed or
continuous basis ("Rule 415"), and the declaration or ordering of effectiveness
of such Registration Statement by the United States Securities and Exchange
Commission (the "SEC").
(iv) "Registered Securities" will have the same meaning as set forth in
the Purchase Agreement.
(v) "Registration Statement" means the Company’s registration statement on Form
S-1, or any similar registration statement of the Company filed with SEC under
the Securities Act with respect to the Registered Securities.
(vi) "EDGAR" means the SEC's Electronic Data Gathering, Analysis and
Retrieval System.
(vii) “Exchange Act” means the Securities Exchange Act of 1934, as
amended, or any similar federal statute, and the rules and regulations of the
SEC thereunder, all as the same will then be in effect.
(b) Capitalized terms used herein and not otherwise defined herein
shall have the respective meanings set forth in the Purchase Agreement.
2. Obligation of the Company. In connection with the registration of
the Registered Securities, the Company shall do each of the following:
(a) Prepare promptly and file with the SEC by June 30, 2016, a
Registration Statement with respect to not less than the maximum allowable under
Rule 415 of Registered Securities, and thereafter use all commercially
reasonable efforts to cause such Registration Statement relating to the
Registered Securities to become effective within five (5) business days after
notice from the Securities and Exchange Commission that such Registration
Statement may be declared effective, and keep the Registration Statement
effective at all times prior to the termination of the Purchase Agreement until
the earliest of (i) the date that is three months after the completion of the
last Closing Date under the Purchase Agreement, (ii) the date when the Investor
may sell all Registered Securities under Rule 144 without volume limitations, or
(iii) the date the Investor no longer owns any of the Registered Securities
(collectively, the "Registration Period"), which Registration Statement
(including any amendments or supplements, thereto and prospectuses contained
therein) shall not contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading;
(b) Prepare and file with the SEC such amendments (including post-effective
amendments) and supplements to the Registration Statement and the prospectus
used in connection with the Registration Statement as may be necessary to keep
the Registration Statement effective at all times during the Registration
Period, and to comply with the provisions of the Securities Act with respect to
the disposition of all Registered Securities of the Company covered by the
Registration Statement until the expiration of the Registration Period.
(c) With respect to the Registered Securities, upon written request by
the Investor, permit counsel designated by Investor to review the Registration
Statement and all amendments and supplements thereto a reasonable period of time
(but not less than two (2) business days) prior to their filing with the SEC,
and not file any document in a form to which such counsel reasonably objects.
(d) As promptly as practicable after becoming aware of the following facts,
the Company shall notify Investor and Investor’s legal counsel identified to the
Company and (if requested by any such person) confirm such notice in writing no
later than one (1) business day thereafter (i): (A) when a prospectus or any
prospectus supplement or post-effective amendment to the Registration Statement
is filed; (B) with respect to the Registration Statement or any post-effective
amendment, when the same has become effective; (ii) of the issuance by the SEC
of any stop order suspending the effectiveness of the Registration Statement
covering any or all of the Registered Securities or the initiation of any
proceedings for that purpose; and (iii) of the receipt by the Company of any
notification with respect to the suspension of the qualification or exemption
from qualification of any of the Registered Securities for sale in any
jurisdiction, or the initiation or threatening of any proceeding for such
purpose.
(e) Unless available to the Investor without charge through EDGAR, the
SEC's website or the Company's website, furnish to Investor, promptly after the
same is prepared and publicly distributed, filed with the SEC, or received by
the Company, one (1) copy of the Registration Statement, each preliminary
prospectus and the prospectus, and each amendment or supplement thereto;
(f) Use all commercially reasonable efforts to (i) register and/or
qualify the Registered Securities covered by the Registration Statement under
such other securities or blue sky laws of such jurisdictions as the Investor may
reasonably request and in which significant volumes of shares of Common Stock
are traded, (ii) prepare and file in those jurisdictions such amendments
(including post-effective amendments) and supplements to such registrations and
qualifications as may be necessary to maintain the effectiveness thereof at all
times during the Registration Period, (iii) take such other actions as may be
necessary to maintain such registrations and qualification in effect at all
times during the Registration Period, and (iv) take all other actions reasonably
necessary or advisable to qualify the Registered Securities for sale in such
jurisdictions: provided, however, that the Company shall not be required in
connection therewith or as a condition thereto to (A) qualify to do business in
any jurisdiction where it would not otherwise be required to qualify but for
this Section 3(f), (B) subject itself to general taxation in any such
jurisdiction, (C) file a general consent to service of process in any such
jurisdiction, (D) provide any undertakings that cause more than nominal expense
or burden to the Company or (E) make any change in its charter or by-laws or any
then existing contracts, which in each case the Board of Directors of the
Company determines to be contrary to the best interests of the Company and its
stockholders;
(g) As promptly as practicable after becoming aware of such event,
notify the Investor of the happening of any event of which the Company has
knowledge, as a result of which the prospectus included in the Registration
Statement, as then in effect, includes any untrue statement of a material fact
or omits to state a material fact required to be stated therein or necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading ("Registration Default"), and promptly prepare a
supplement or amendment to the Registration Statement or other appropriate
filing with the SEC to correct such untrue statement or omission, and take any
other commercially reasonable steps to cure the Registration Default, and,
unless available to the Investor without charge through EDGAR, the SEC's website
or the Company's website, deliver a number of copies of such supplement or
amendment to the Investor as the Investor may reasonably request.
(h) Use its commercially reasonable efforts to secure quotation for such
Registered Securities on the OTCQB, OTCQX or OTCPink markets;
(i) Provide a transfer agent for the Registered Securities (the
“Transfer Agent”) not later than the Execution Date under the Purchase
Agreement;
(j) Cooperate with the Investor to facilitate the timely preparation
and delivery of certificates for the Registered Securities to be offered
pursuant to the Registration Statement and enable such certificates for the
Registered Securities to be in such denominations or amounts as the case may be,
as the Investor may reasonably request and registration in such names as the
Investor may request; and, within five (5) business days after a Registration
Statement which includes Registered Securities is ordered effective by the SEC,
the Company shall deliver, and shall cause legal counsel selected by the Company
to deliver, to the Transfer Agent (with copies to the Investor) an appropriate
instruction and opinion of such counsel, if so required by the Transfer Agent;
and
(k) Take all other commercially reasonable actions necessary to
expedite and facilitate distribution to the Investor of the Registered
Securities pursuant to the Registration Statement.
3. Obligations of the Investor. In connection with the registration of
the Registered Securities, the Investor shall have the following obligations;
(a) It shall be a condition precedent to the obligations of the Company
to complete the registration pursuant to this Agreement with respect to the
Registered Securities of the Investor that the Investor shall timely furnish to
the Company such information regarding itself, the Registered Securities held by
it, and the intended method of disposition of the Registered Securities held by
it, as shall be reasonably required to effect the registration of such
Registered Securities and shall timely execute such documents in connection with
such registration as the Company may reasonably request.
(b) The Investor by such Investor’s acceptance of the Registered
Securities agrees to cooperate with the Company as reasonably requested by the
Company in connection with the preparation and filing of the Registration
Statement hereunder; and
(c) The Investor agrees that, upon receipt of any notice from the
Company of the happening of any event of the kind described in Section 2(d)(ii)
or (iii) or 2(g) above, the Investor will immediately discontinue disposition of
Registered Securities pursuant to the Registration Statement covering such
Registered Securities until the Investor receives the copies of the supplemented
or amended prospectus contemplated by Section 2(d)(ii) or (iii) or 2(g) and, if
so directed by the Company, the Investor shall deliver to the Company (at the
expense of the Company) or destroy (and deliver to the Company a certificate of
destruction) all copies in the Investor’s possession, of the prospectus covering
such Registered Securities current at the time of receipt of such notice.
4. Expenses of Registration. All reasonable expenses incurred
in connection with registrations, filings or qualifications pursuant to Section
2, including, without limitation, all registration, listing, and qualifications
fees, printers and accounting fees, the fees and disbursements of counsel for
the Company shall be borne by the Company.
5. Indemnification. After Registered Securities are included
in a Registration Statement under this Agreement:
(a) To the extent permitted by law, the Company will indemnify and hold
harmless, the Investor, the directors, if any, of such Investor, the officers,
if any, of such Investor, each person, if any, who controls the Investor within
the meaning of the Securities Act or the Exchange Act (each, an "Indemnified
Person"), against any losses, claims, damages, liabilities or expenses (joint or
several) incurred (collectively, "Claims") to which any of them may become
subject under the Securities Act, the Exchange Act or otherwise, insofar as such
Claims (or actions or proceedings, whether commenced or threatened, in respect
thereof) arise out of or are based upon: (i) any untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement or
any post-effective amendment thereof or the omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, (ii) any untrue statement or alleged
untrue statement of a material fact contained in any preliminary prospectus or
contained in the final prospectus (as amended or supplemented, if the Company
files any amendment thereof or supplement thereto with the SEC) or the omission
or alleged omission to state therein any material fact necessary to make the
statements made therein, in the light of the circumstances under which the
statements therein were made, not misleading or (iii) any violation or alleged
violation by the Company of the Securities Act, the Exchange Act, any state
securities law or any rule or regulation under the Securities Act, the Exchange
Act or any state securities law (the matters in the foregoing clauses (i)
through (iii) being collectively referred to as "Violations"). Subject to
Section 5(b) hereof, the Company shall reimburse the Investor, promptly as such
expenses are incurred and are due and payable, for any reasonable legal fees or
other reasonable expenses incurred by them in connection with investigating or
defending any such Claim. Notwithstanding anything to the contrary contained
herein, the indemnification agreement contained in this Section 5(a) shall not
(i) apply to any Claims arising out of or based upon a Violation which occurs in
reliance upon and in conformity with information furnished in writing to the
Company by or on behalf of any Indemnified Person expressly for use in
connection with the preparation of the Registration Statement or any such
amendment thereof or supplement thereto, if such prospectus was timely made
available by the Company pursuant to Section 2(b) hereof; (ii) with respect to
any preliminary prospectus, inure to the benefit of any such person from whom
the person asserting any such Claim purchased the Registered Securities that are
the subject thereof (or to the benefit of any person controlling such person) if
the untrue statement or omission of material fact contained in the preliminary
prospectus was corrected in the prospectus, as then amended or supplemented, if
such prospectus was timely made available by the Company pursuant to Section
2(b) hereof; (iii) be available to the extent such Claim is based on a failure
of the Investor to deliver or cause to be delivered the prospectus made
available by the Company; or (iv) apply to amounts paid in settlement of any
Claim if such settlement is effected without the prior written consent of the
Company, which consent shall not be unreasonably withheld. The Investor will
indemnify the Company, its officers, directors and agents (including legal
counsel) against any claims arising out of or based upon a Violation which
occurs in reliance upon and in conformity with information furnished in writing
to the Company, by or on behalf of the Investor, expressly for use in connection
with the preparation of the Registration Statement, subject to such limitations
and conditions set forth in the previous sentence.
(b) Promptly after receipt by an Indemnified Person under this Section
5 of notice of the commencement of any action (including any governmental
action), such Indemnified Person shall, if a Claim in respect thereof is to be
made against any indemnifying party under this Section 5, deliver to the
indemnifying party a written notice of the commencement thereof and the
indemnifying party shall have the right to participate in, and, to the extent
the indemnifying party so desires, jointly with any other indemnifying party
similarly noticed, to assume control of the defense thereof with counsel
mutually satisfactory to the indemnifying party and the Indemnified Person, as
the case may be; provided, however, that an Indemnified Person shall have the
right to retain its own counsel with the reasonable fees and expenses to be paid
by the indemnifying party, if, in the reasonable opinion of counsel retained by
the indemnifying party, the representation by such counsel of the Indemnified
Person and the indemnifying party would be inappropriate due to actual or
potential differing interests between such Indemnified Person and any other
party represented by such counsel in such proceeding. In such event, the Company
shall pay for only one separate legal counsel for the Investor selected by the
Investor. The failure to deliver written notice to the indemnifying party within
a reasonable time of the commencement of any such action shall not relieve such
indemnifying party of any liability to the Indemnified Person under this Section
5, except to the extent that the indemnifying party is prejudiced in its ability
to defend such action. The indemnification required by this Section 5 shall be
made by periodic payments of the amount thereof during the course of the
investigation or defense, as such expense, loss, damage or liability is incurred
and is due and payable.
6. Contribution. To the extent any indemnification by an
indemnifying party is prohibited or limited by law, the indemnifying party
agrees to make the maximum contribution with respect to any amounts for which it
would otherwise be liable under Section 5 to the fullest extent permitted by
law; provided, however, that (a) no contribution shall be made under
circumstances where the maker would not have been liable for indemnification
under the fault standards set forth in Section 5 and; (b) no seller of
Registered Securities guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any seller of Registered Securities who was not guilty of such fraudulent
misrepresentation.
7. Reports under Exchange Act. With a view to making available to the
Investor the benefits of Rule 144 promulgated under the Securities Act or any
other similar rule or regulation of the SEC that may at any time permit the
Investor to sell securities of the Company to the public without registration
("Rule 144"), the Company agrees to use its commercially reasonable efforts to:
(a) make and keep public information available, as those terms are
understood and defined in Rule 144;
(b) file with the SEC in a timely manner all reports and other
documents required of the Company under the Securities Act for so long as the
Company remains subject to such requirements, and the filing of such reports is
required for sales under Rule 144;
(c) furnish to the Investor so long as the Investor owns Registered
Securities, promptly upon request, (i) a written statement by the Company that
it has complied with the reporting requirements of Rule 144, the Securities Act
and the Exchange Act, (ii) unless available to the Investor without charge
through EDGAR, the SEC's website or the Company's website, a copy of the most
recent annual or quarterly report of the Company and such other reports and
documents so filed by the Company, and (iii) such other information as may be
reasonably requested to permit the Investors to sell such securities pursuant to
Rule 144 without registration; and
(d) at the request of any Investor of Registered Securities, give its
Transfer Agent instructions (supported by an opinion of Company counsel, if
required or requested by the Transfer Agent) to the effect that, upon the
Transfer Agent’s receipt from such Investor of:
(i) a certificate (a “Rule 144 Certificate”) certifying (A) that such Investor
has held the shares of Registered Securities which the Investor proposes to sell
(the “Securities Being Sold”) for a period of not less than (6) months and (B)
as to such other matters as may be appropriate in accordance with Rule 144 under
the Securities Act, and
(ii) an opinion of counsel acceptable to the Company (for which purposes it is
agreed that the initial Investor’s counsel shall be deemed acceptable if such
opinion is not given by Company counsel) that, based on the Rule 144
Certificate, Securities Being Sold may be sold pursuant to the provisions of
Rule 144, even in the absence of an effective Registration Statement, the
Transfer Agent is to effect the transfer of the Securities Being Sold and issue
to the buyer(s) or transferee(s) thereof one or more stock certificates
representing the transferred Securities Being Sold without any restrictive
legend and without recording any restrictions on the transferability of such
shares on the Transfer Agent’s books and records (except to the extent any such
legend or restriction results from facts other than the identity of the
Investor, as the seller or transferor thereof, or the status, including any
relevant legends or restrictions, of the shares of the Securities Being Sold
while held by the Investor). If the Transfer Agent requires any additional
documentation at the time of the transfer, the Company shall deliver or cause to
be delivered all such reasonable additional documentation as may be necessary to
effectuate the issuance of an certificate without any restrictive legend.
8. Miscellaneous.
(a) Registered Owners. A person or entity is deemed to be a holder of
Registered Securities whenever such person or entity owns of record such
Registered Securities. If the Company receives conflicting instructions, notices
or elections from two or more persons or entities with respect to the same
Registered Securities, the Company shall act upon the basis of instructions,
notice or election received from the registered owner of such Registered
Securities.
(b) Rights Cumulative; Waivers. The rights of each of the parties under
this Agreement are cumulative. The rights of each of the parties hereunder shall
not be capable of being waived or varied other than by an express waiver or
variation in writing. Any failure to exercise or any delay in exercising any of
such rights shall not operate as a waiver or variation of that or any other such
right. Any defective or partial exercise of any of such rights shall not
preclude any other or further exercise of that or any other such right. No act
or course of conduct or negotiation on the part of any party shall in any way
preclude such party from exercising any such right or constitute a suspension or
any variation of any such right.
(c) Benefit; Successors Bound. This Agreement and the terms, covenants,
conditions, provisions, obligations, undertakings, rights, and benefits hereof,
shall be binding upon, and shall inure to the benefit of, the undersigned
parties and their successors.
(d) Entire Agreement. This Agreement contains the entire agreement
between the parties with respect to the subject matter hereof. There are no
promises, agreements, conditions, undertakings, understandings, warranties,
covenants or representations, oral or written, express or implied, between them
with respect to this Agreement or the matters described in this Agreement,
except as set forth in this Agreement and in the other documentation relating to
the transactions contemplated by this Agreement. Any such negotiations,
promises, or understandings shall not be used to interpret or constitute this
Agreement.
(e) Amendment. Any provision of this Agreement may be amended and the
observance thereof may be waived (either generally or in a particular instance
and either retroactively or prospectively), only with the written consent of the
Company and Investor. Any amendment or waiver affected in accordance with this
Section 9 shall be binding upon the Company.
(f) Severability. Each part of this Agreement is intended to be
severable. In the event that any provision of this Agreement is found by any
court or other authority of competent jurisdiction to be illegal or
unenforceable, such provision shall be severed or modified to the extent
necessary to render it enforceable and as so severed or modified, this Agreement
shall continue in full force and effect.
(g) Notices. Any and all notices or other communications or deliveries
to be provided by the Investor hereunder shall be in writing and delivered
personally, by facsimile, by email attachment, or sent by a nationally
recognized overnight courier service, addressed to the Company, at the address
set forth below, or such other facsimile number, email address, or address as
the Company may specify for such purposes by notice to the Holder delivered in
accordance with this Section 8(g). Any and all notices or other communications
or deliveries to be provided by the Company hereunder shall be in writing and
delivered personally, by facsimile, by email attachment, or sent by a nationally
recognized overnight courier service addressed to the Investor at the facsimile
number or email address or address of the Investor set forth below. Any notice
or other communication or deliveries hereunder shall be deemed given and
effective on the earliest of (i) the date of transmission, if such notice or
communication is delivered via facsimile at the facsimile number or email
attachment to the email address set forth on the signature pages attached hereto
prior to 5:30 p.m. (New York City time) on any date, (ii) the next Trading Day
after the date of transmission, if such notice or communication is delivered via
facsimile at the facsimile number or email attachment to the email address set
forth on the signature pages attached hereto on a day that is not a Trading Day
or later than 5:30 p.m. (New York City time) on any Trading Day, (iii) the
second Trading Day following the date of mailing, if sent by U.S. nationally
recognized overnight courier service or (iv) upon actual receipt by the party to
whom such notice is required to be given. The addresses for such communications
shall be:
If to the Company:
Emerald Medical Applications Corp.
7 Imber Street
Petach Tikva 4951141 Israel
Attn: Lior Wayn, CEO
Email: lior@dermacompare.com
with a copy to:
Office of Richard Rubin
40 Wall Street, 28th Floor
New York, NY 10005
Attn: Richard Rubin, Esq.
Email: rrubin@parkavenuegroup.us
If to the Investor:
Kodiak Capital Group, LLC
260 Newport Center Drive
Newport Beach, CA 92660
infor@kodiakfunds.com
Either party hereto may from time to time change its address or email for
notices under this Section 8(g) by giving at least ten (10) days' prior written
notice of such changed address to the other party hereto.
(h) Governing Law. This Agreement and all acts and transactions
pursuant hereto and the rights and obligations of the Company and the Investor
shall be governed, construed and interpreted in accordance with the laws of the
State of California, without giving effect to principles of conflicts of law.
Each of the Company and Investor hereby submit to the exclusive jurisdiction of
the United States Federal and state courts located in California with respect to
the adjudication of any dispute hereunder or in connection herewith or with any
transaction contemplated hereby or discussed herein.
(i) Consents. The person signing this Agreement on behalf of each party
hereby represents and warrants that he has the necessary power, consent and
authority to execute and deliver this Agreement on behalf of that party.
(j) Further Assurances. In addition to the instruments and documents to
be made, executed and delivered pursuant to this Agreement, the parties hereto
agree to make, execute and deliver or cause to be made, executed and delivered,
to the requesting party such other instruments and to take such other actions as
the requesting party may reasonably require to carry out the terms of this
Agreement and the transactions contemplated hereby.
(k) Section Headings. The Section headings in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
(l) Construction. Unless the context otherwise requires, when used
herein, the singular shall be deemed to include the plural, the plural shall be
deemed to include each of the singular, and pronouns of one or no gender shall
be deemed to include the equivalent pronoun of the other or no gender.
(m) Execution in Counterparts. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original but all of which
shall constitute one and the same agreement. This Agreement, once executed by a
party, may be delivered to the other party hereto by email of a .pdf or
telephone line facsimile transmission of a copy of this Agreement bearing the
signature of the party so delivering this Agreement. A facsimile transmission or
email of a .pdf of this signed Agreement shall be legal and binding on all
parties hereto.
IN WITNESS WHEREOF, the parties have caused this Registration Rights Agreement
to be duly executed by their respective officers thereunto duly authorized as of
the day and year first above written.
COMPANY:
EMERALD MEDICAL APPLICATIONS CORP.
By: /s/ Lior Wayn
Name: Lior Wayn
Title: Chief Executive Officer
INVESTOR:
KODIAK CAPITAL GROUP, LLC
By:
Name:
Title: