Table of Contents

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-K

 

ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the fiscal year ended December 31, 2020

 

OR

 

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from                   to                    

 

Commission file number: 333-200344

 

Tribal Rides International Corp.

(Exact name of Registrant in its charter)

 

Nevada 37-1758469

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer Identification No.)
   
26060 Acero, Mission Viejo, CA 92691
(Address of principal executive offices) (Zip Code)

 

Issuer’s telephone number, including area code: (949) 434-7259

 

Xinda International Corp

(Former Name)

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class Name of each exchange on which registered
N/A N/A

 

Securities registered pursuant to Section 12(g) of the Act:

 

Title of each class Trading Symbol(s) Name of each exchange on which registered
N/A N/A N/A

 

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined by Rule 405 of the Securities Act. ☐ Yes ☒ No

 

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. ☒ Yes ☐ No

 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☐ No ☒

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☐ Yes ☒ No

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer ☐   Accelerated  filer ☐
Non-accelerated filer ☐ Smaller reporting company ☒
  Emerging growth company ☒

 

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

 

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

 

The aggregate market value of the voting and non-voting common equity held by non-affiliates of the registrant as of the last business day of its most recently completed second fiscal quarter based upon the price at which the common equity was last sold was $43,950,000.

 

As of September 27, 2021, there were 36,057,500 shares of the registrant’s Common Stock outstanding.

 

DOCUMENTS INCORPORATED BY REFERENCE

 

None

 

     

 

 

TABLE OF CONTENTS

 

     
PART I   1
ITEM 1. BUSINESS  
1ITEM 1A. RISK FACTORS 3
ITEM 2. PROPERTIES 3
ITEM 3. LEGAL PROCEEDINGS 3
ITEM 4. MINE SAFETY DISCLOSURES 3
     
PART II   4
ITEM 5. MARKET FOR COMPANY'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES. 4
ITEM 6. SELECTED FINANCIAL DATA. 6
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 6
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 9
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA 9
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE 11
ITEM 9A. CONTROLS AND PROCEDURES 11
ITEM 9B. OTHER INFORMATION 12
     
PART III   13
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE. 13
ITEM 11. EXECUTIVE COMPENSATION 14
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDERS MATTERS 15
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE 16
ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES. 16
     
PART IV   17
ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES 17
ITEM 16. FORM 10-K SUMMARY 17
     
SIGNATURES 18

 

 

  i  

 

 

Forward-Looking Statements

 

The statements contained in this report that are not historical facts are forward-looking statements that represent management’s beliefs and assumptions based on currently available information. Forward-looking statements include the information concerning possible or assumed future operations, business strategies, need for financing, competitive position, potential growth opportunities, ability to retain and recruit personnel, the effects of competition and the effects of future legislation or regulations. Forward-looking statements include all statements that are not historical facts and can be identified by the use of forward-looking terminology such as the words “believes,” “intends,” “may,” “should,” “anticipates,” “expects,” “could,” “plans,” or comparable terminology or by discussions of strategy or trends. Although we believe that the expectations reflected in such forward-looking statements are reasonable, we cannot give any assurances that these expectations will prove to be correct. Such statements by their nature involve risks and uncertainties that could significantly affect expected results, and actual future results could differ materially from those described in such forward-looking statements.

 

Factors that may cause differences between actual results and those contemplated by forward-looking statements may include, but are not limited to the following:

 

  · the unprecedented impact of COVID-19 pandemic on our business, customers, employees, subcontractors, consultants, service providers, stockholders, investors and other stakeholders;
  · general market and economic conditions;
  · our ability to acquire customers;
  · our ability to meet the volume and service requirements of our customers;
  · industry consolidation, including acquisitions by us or our competitors;
  · success in developing new products;
  · timing of our new product introductions;
  · new product introductions by competitors;
  · the ability of competitors to more fully leverage low-cost geographies for manufacturing or distribution;
  · product pricing, including the impact of currency exchange rates;
  · effectiveness of sales and marketing resources and strategies;
  · adequate manufacturing capacity and supply of components and materials;
  · strategic relationships with suppliers;
  · product quality and performance;
  · protection of our products and brand by effective use of intellectual property laws;
  · the financial strength of our competitors;
  · the outcome of any future litigation or commercial dispute;
  · barriers to entry imposed by competitors with significant market power in new markets; and
  · government actions throughout the world.

  

Although the forward-looking statements in this Annual Report on Form 10-K (the “Annual Report”) are based on our beliefs, assumptions and expectations, taking into account all information currently available to us, we cannot guarantee future transactions, results, performance, achievements or outcomes. No assurance can be made by anyone that the expectations reflected in our forward-looking statements will be attained, or that deviations from them will not be material and adverse. We undertake no obligation, other than as maybe be required by law, to update this Annual Report or otherwise make public statements updating our forward-looking statements.

 

Introductory Comment

 

Unless otherwise indicated, any reference to “the Company”, “our company”, “we”, “us”, or “our” refers to Tribal Rides International Corp., a Nevada corporation.

 

 

 

  ii  

 

 

PART I

 

ITEM 1. BUSINESS

 

Tribal Rides International Corp., a Nevada corporation (the “Company”), was incorporated on May 19, 2014 as “Trimax Consulting, Inc.” On May 8, 2017, the Company changed its name to “Xinda International Corp.”

 

From incorporation through January 2020, the Company was principally engaged in the business of marketing an array of property tax lien services including (a) identifying property tax lien auctions and property tax liens for sale; (b) providing valuation services with regards to real property subject to property tax liens; and (c) providing consultative and advisory services to property tax lien investors in regards to purchasing property tax liens, servicing property tax liens and adjudicating property tax liens.

 

On January 18, 2020, the Company entered into an Asset Purchase Agreement with Tribal Rides, Inc., a Nevada corporation (“Tribal Rides”), pursuant to which the Company purchased certain assets of Tribal Rides in exchange for the issuance of 25,000,000 shares of the Company’s Common Stock. On February 24, 2021, the Company changed its name to “Tribal Rides International Corp.”

 

After the asset purchase, we are now engaged in a business that is in the research and development stage of disrupting current ride-sharing paradigms. We are a transportation technology company creating the future of personal mobility with a unique, patented focus on autonomous vehicles. We believe that the mobility ecosystem and marketplace we are creating, based upon our innovative patent and patent-pending technologies, will enable us to address current ridesharing demands and those of the rapidly emerging autonomous vehicle personal mobility market. We are focused on having a significant impact in the emerging self-driving car marketplace estimated at $3 trillion by 20301.

 

Our Principal Products or Services and Markets

 

We are developing a cloud-based Systems as a Solution (“SaaS”) interface for a comprehensive social network and mobile app. Our planned E-commerce module will enable users to create and manage their own highly personalized transportation experience; to form and/or join groups; collaborate on cost-saving strategies; find, schedule, obtain transportation services from within the groups in which they belong, and easily and securely conduct financial transactions.

 

We believe that the approximately fourteen million shared-ride drivers in the United States are possible customers for our SaaS services and software and they too may be able to move forward with the autonomous vehicles and their expanded scope of services.

 

Autonomous Driving Vehicle Global Market:

 

  · $819 million in 2019
  · $29 billion in 2021 – Forecasted
  · $2.195 billion in 2030 - Forecasted

 

Shared-Ride and Taxi Market (UBER/Lyft/Didi, etc)

 

  · $117 billion dollars in 2021 - Forecasted
  · $209 billion by 2025 – Forecasted; CAGR of 20.2%

 

The Autonomous vehicle market is projected to be approximately 15+ times that of the Shared-Ride and Taxi Market by 2030.2,3

 

 

__________

1https://www.prnewswire.com/news-releases/global-outlook-for-the-autonomous-vehicle-market-to-2030---
sale-of-autonomous-vehicles-is-forecast-to-reach-58-million-units-by-2030-301198944.html

2https://www.prnewswire.com/news-releases/global-outlook-for-the-autonomous-vehicle-market-to-2030---
sale-of-autonomous-vehicles-is-forecast-to-reach-58-million-units-by-2030-301198944.html

3 https://www.marketwatch.com/press-release/ride-sharing-market-size-soaring-at-cagr-of-2021-by-2026-2021-03-12

 

 

  1  

 

 

Environmental, Social and Governance

 

The world’s cities are expanding with a resulting suburban daily automobile commute that is un-scalable and over-crowding infrastructure. The average commuter spends nearly as much annually on vehicles, their maintenance and fuel as they do on housing. We believe that this is proving to be unsustainable both fiscally and environmentally.

 

While electric vehicles reduce some of the environmental burden, they do not improve our clogged roadways nor greatly reduce the cost burden of vehicle ownership. We believe the emergence of self-driving cars enhanced by our Unified Transportation Ecosystem and Marketplace will bring another wave of societal and environmental transformation, making carpooling safer, optimized and convenient resulting in fewer vehicles on the road, and a corresponding reduction in congestion and damaging emissions. We also believe that creating, developing and rewarding a cooperative community of users, developers and vendors through ownership stock grants will inspire loyalty to our platform, create a priority of use and commitment, and will provide for financial advancement while reducing the costs of vehicle use and ownership.

 

Distribution

 

We are developing a cloud-based Systems as a Solution (“SaaS”) interface for a comprehensive social network and mobile app. We plan to distribute our mobile app. through Android and Apple in the future.

 

Marketing

 

Although in its infancy, our marketing plan is to reach out through various social media outlets and to communicate directly with drivers and riders who will be interested our new and innovative features and functions for shared rides.

 

Status of Our Publicly Announced Products or Services

 

Our SaaS interface is still in the development stage.

 

Competition

 

We believe that our disruptive technology and ecosystem will compete with the current shared-ride provider community, specifically Uber and Lyft.

 

Intellectual Property

 

We have patent and patent pending technologies with a focus on artificial intelligence (“AI”), machine learning with optimization and Smart Deployment algorithms. It involves anticipating demand for passengers and dispatching cars in advance – to reduce wait-time, increasing utilization of vehicles, and decrease cost. It includes new and efficient system for tracking and charging customers with preferred rates, supply and demand rates, and “specific” community engagement.

 

We currently own the following patents which have been issued and which are pending:

 

  · U.S. Patent 9,984,574, issued May 29, 2018, claims priority to provisional application filed on Jan. 21, 2014
  · Pending U.S. application, published as US 2018/0366004 A1, claims priority to provisional application filed on Jan. 21, 2014
  · Pending U.S. application, unpublished, claims priority to three provisional applications filed on Nov. 4, 2019.

 

Government Regulation and Effects on Our Business

 

Once we have developed our products and services, we will operate in a particularly complex legal and regulatory environment. Our business will be subject to a variety of U.S. federal, state, local and foreign laws, rules, and regulations, including those related to Internet activities, privacy, cybersecurity, data protection, intellectual property, competition, consumer protection, payments, labor and employment, transportation services, transportation network companies, licensing regulations and taxation. These laws and regulations are constantly evolving and may be interpreted, applied, created, or amended, in a manner that could harm our business.

 

 

 

  2  

 

 

Employees

 

As of September 13, 2021, we had no employees. All work is currently being accomplished by sub-contractors.

 

ITEM 1A. RISK FACTORS

 

Not applicable to “smaller reporting companies.”

 

ITEM 2. PROPERTIES

 

Our current corporate offices are located at 26060 Acero, Mission Viejo, CA 92691. We have entered into a month-to-month agreement for lease of our corporate offices at a cost of $394 per month. Our telephone number is (949) 434-7259.

 

ITEM 3. LEGAL PROCEEDINGS

 

We are currently not aware of any such legal proceedings or claims that we believe will have, individually or in the aggregate, a material adverse effect on our business, financial condition or operating results. From time to time, we may become involved in various lawsuits and legal proceedings, which arise in the ordinary course of business. However, litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm our business.

 

ITEM 4. MINE SAFETY DISCLOSURES

 

Not applicable.

 

 

 

 

 

 

 

  3  

 

PART II

 

ITEM 5. MARKET FOR COMPANY'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.

 

Our common stock is quoted on the OTC Pink under the symbol “XNDA.” The table below sets forth for the periods indicated the quarterly high and low bid prices as reported by OTC Markets. Limited trading volume has occurred during these periods. These quotations reflect inter-dealer prices, without retail mark-up, mark-down, or commission and may not necessarily represent actual transactions.

 

    Quarter     High(1)     Low(1)  
FISCAL YEAR ENDING DECEMBER 31, 2021     First     $ 6.10     $ 1.50  
      Second     $ 4.02     $ 0.99  

 

    Quarter     High     Low  
FISCAL YEAR ENDED DECEMBER 31, 2020     First     $ 5.00     $ 5.00  
      Second     $ 5.00     $ 5.00  
      Third     $ 5.00     $ 5.00  
      Fourth     $ 5.00     $ 5.00  

 

    Quarter     High     Low  
FISCAL YEAR ENDED DECEMBER 31, 2019     First     $ 5.00     $ 5.00  
      Second     $ 5.00     $ 5.00  
      Third     $ 5.00     $ 5.00  
      Fourth     $ 5.00     $ 5.00  

____________________

(1) The first trade of our Common Stock did not occur until January 1, 2021.

 

Our common stock is considered to be penny stock under rules promulgated by the SEC. Under these rules, broker-dealers participating in transactions in these securities must first deliver a risk disclosure document which describes risks associated with these stocks, broker-dealers’ duties, customers’ rights and remedies, market and other information, and make suitability determinations approving the customers for these stock transactions based on financial situation, investment experience and objectives. Broker-dealers must also disclose these restrictions in writing, provide monthly account statements to customers, and obtain specific written consent of each customer. With these restrictions, the likely effect of designation as a penny stock is to decrease the willingness of broker-dealers to make a market for the stock, to decrease the liquidity of the stock and increase the transaction cost of sales and purchases of these stocks compared to other securities.

 

Holders

 

As of the close of business on September 27, 2021, we had approximately 18 holders of our common stock. The number of record holders was determined from the records of our transfer agent and does not include beneficial owners of common stock whose shares are held in the names of various security brokers, dealers, and registered clearing agencies. We have appointed Olde Monmouth Stock Transfer Co Inc., 200 Memorial Parkway, Atlantic Highlands, NJ 07716, to act as transfer agent for the common stock.

 

Dividends

 

We have never declared a cash dividend on our common stock and our Board of Directors does not anticipate that we will pay cash dividends in the foreseeable future. Any future determination to pay cash dividends will be at the discretion of our board of directors and will depend upon our financial condition, operating results, capital requirements, restrictions contained in our agreements and other factors which our Board of Directors deems relevant.

 

 

 

 

  4  

 

 

Securities Authorized for Issuance under Equity Compensation Plans

 

Equity Compensation Plan Information

 

Plan category   Number of
securities to be
issued upon exercise
of outstanding
options, warrants
and rights
    Weighted-average
exercise price
of outstanding
options, warrants
and rights
    Number of
securities
remaining available
for future
issuance under
equity compensation
plans (excluding
securities reflected
in column (a))
 
    (a)     (b)     (c)  
Equity compensation plans approved by security holders                  
Equity compensation plans not approved by security holders     300,000 (1)   $ 0.01       2,200,000 (2)
Total     300,000     $ 0.01       2,200,000  

 

(1) Effective June 20, 2020, the Company granted options to purchase an aggregate of 300,000 shares of the Company’s Common Stock, exercisable at $0.01 per share, with 100,000 options awarded to each of Messrs. Grimes, Prasad, and Ritacco.

 

(2) Effective June 20, 2020, the Company approved and authorized the 2020 Stock Incentive Plan (the “Plan”), which authorized 2,500,000 shares of the Company’s Common Stock for future issuances under the Plan.

 

2020 Stock Incentive Plan

 

Effective June 20, 2020, the Board of Directors adopted the 2020 Stock Incentive Plan (the “Plan”). The purposes of the Plan are (a) to enhance our ability to attract and retain the services of qualified employees, officers, directors, consultants, and other service providers upon whose judgment, initiative and efforts the successful conduct and development of our business largely depends, and (b) to provide additional incentives to such persons or entities to devote their utmost effort and skill to the advancement and betterment of our company, by providing them an opportunity to participate in the ownership of our Company and thereby have an interest in the success and increased value of our Company.

 

The Plan is administered by our board of directors; however, the board of directors may designate administration of the Plan to a committee consisting of at least two independent directors. Only employees of our Company or of an “Affiliated Company”, as defined in the Plan, (including members of the board of directors if they are employees of our Company or of an Affiliated Company) are eligible to receive incentive stock options under the Plan. Employees of our Company or of an Affiliated Company, members of the board of directors (whether or not employed by our company or an Affiliated Company), and “Service Providers”, as defined in the Plan, are eligible to receive non-qualified options, restricted stock units, and stock appreciation rights under the Plan. All awards are subject to Section 162(m) of the Internal Revenue Code.

 

No option awards may be exercisable more than ten years after the date it is granted. In the event of termination of employment for cause, the options terminate on the date of employment is terminated. In the event of termination of employment for disability or death, the optionee or administrator of optionee’s estate or transferee has six months following the date of termination to exercise options received at the time of disability or death. In the event of termination for any other reason other than for cause, disability or death, the optionee has 30 days to exercise his or her options.

   

The Plan will continue in effect until all the stock available for grant or issuance has been acquired through exercise of options or grants of shares, or until ten years after its adoption, whichever is earlier. Awards under the Plan may also be accelerated in the event of certain corporate transactions such as a merger or consolidation or the sale, transfer or other disposition of all or substantially all our assets.

 

 

 

  5  

 

 

There are 2,500,000 shares authorized for issuance under the Plan.

 

As of December 31, 2020, the Board had granted options to purchase 300,000 shares Common Stock under the Plan.

 

Stock Options

 

We have issued options to purchase 300,000 shares of our common stock, as described herein.

 

Recent Sales of Unregistered Securities

 

The Company had no unreported sales of unregistered securities in the fourth quarter of 2020.

 

ITEM 6. SELECTED FINANCIAL DATA.

 

Not applicable to a smaller reporting company.

 

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 

This Management’s Discussion and Analysis of Financial Condition and Results of Operations contain certain forward-looking statements. Historical results may not indicate future performance. Our forward-looking statements reflect our current views about future events; are based on assumptions and are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from those contemplated by these statements. Factors that may cause differences between actual results and those contemplated by forward-looking statements include, but are not limited to, those discussed herein. We undertake no obligation to publicly update or revise any forward-looking statements, including any changes that might result from any facts, events, or circumstances after the date hereof that may bear upon forward-looking statements. Furthermore, we cannot guarantee future results, events, levels of activity, performance, or achievements

 

Basis of Presentation

 

The accompanying financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission (“SEC”).

  

Forward-Looking Statements

 

Statements in this management’s discussion and analysis of financial condition and results of operations contain certain forward-looking statements. To the extent that such statements are not recitations of historical fact, such statements constitute forward looking statements which, by definition involve risks and uncertainties. Where in any forward-looking statements, if we express an expectation or belief as to future results or events, such expectation or belief is expressed in good faith and believed to have a reasonable basis, but there can be no assurance that the statement of expectation or belief will result or be achieved or accomplished.

  

 

 

 

 

  6  

 

 

Factors that may cause differences between actual results and those contemplated by forward-looking statements and are not limited to the following:

 

  · the unprecedented impact of COVID-19 pandemic on our business, customers, employees, subcontractors, consultants, service providers, stockholders, investors and other stakeholders;
  · general market and economic conditions;
  · our ability to acquire customers;
  · our ability to meet the volume and service requirements of our customers;
  · industry consolidation, including acquisitions by us or our competitors;
  · success in developing new products;
  · timing of our new product introductions;
  · new product introductions by competitors;
  · the ability of competitors to more fully leverage low-cost geographies for manufacturing or distribution;
  · product pricing, including the impact of currency exchange rates;
  · effectiveness of sales and marketing resources and strategies;
  · adequate manufacturing capacity and supply of components and materials;
  · strategic relationships with suppliers;
  · product quality and performance;
  · protection of our products and brand by effective use of intellectual property laws;
  · the financial strength of our competitors;
  · the outcome of any future litigation or commercial dispute;
  · barriers to entry imposed by competitors with significant market power in new markets; and
  · government actions throughout the world.

 

You should not rely on forward-looking statements in this document. This management’s discussion contains forward looking statements that involve risks and uncertainties. We use words such as “anticipates,” “believes,” “plans,” “expects,” “future,” “intends,” and similar expressions to identify these forward-looking statements. Prospective investors should not place undue reliance on these statements, which apply only as of the date of this document. Our actual results could differ materially from those anticipated in these forward-looking statements.

  

Critical Accounting Policies and Estimates

 

The following discussions are based upon our financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States.

 

Going Concern Considerations

 

The accompanying financial statements have been prepared in conformity with generally accepted accounting principles in the United States of America, which contemplate continuation of our Company as a going concern. We currently have no revenues, have incurred net losses, and have an accumulated deficit of $178,753 as of December 31, 2020. The continuation of our Company as a going concern is dependent upon our ability to raise equity or debt financing, and the attainment of profitable operations from any future business we may acquire. There are no assurances that we will be successful in obtaining sufficient capital to continue as a going concern. If our working capital needs are not met and we are unable to obtain adequate capital, we could be forced to cease operations.

 

 

 

 

  7  

 

 

Use of Estimates and Assumptions

 

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

 

Intellectual Property

 

We have patent and patent pending technologies with a focus on artificial intelligence (“AI”), machine learning with optimization and Smart Deployment algorithms. It involves anticipating demand for passengers and dispatching cars in advance – to reduce wait-time, increasing utilization of vehicles, and decrease cost. It includes new and efficient system for tracking and charging customers with preferred rates, supply and demand rates, and “specific” community engagement.

 

Patent expenses, consisting mainly of patent filing fees, have been capitalized and are shown as an asset on our balance sheet. We amortize our Patent asset over the remaining life of the Patent, which is approximately ten (10) years.

 

Long-lived Assets

 

We follow ASC 360-10-15-3, Impairment or Disposal of Long-lived Assets, which established a “primary asset” approach to determine the cash flow estimation period for a group of assets and liabilities that represents the unit of accounting for a long-lived asset to be held and used.  Long-lived assets to be held and used are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The carrying amount of a long-lived asset is not recoverable if it exceeds the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset.  Long-lived assets to be disposed of are reported at the lower of carrying amount or fair value less cost to sell.

 

Common Stock Issued for Services

 

Our accounting policy for equity instruments issued to consultants and vendors in exchange for goods and services follows the provisions of Emerging Issues Task Force (“EITF”) 96-18, Accounting for Equity Instruments That are Issued to Other Than Employees for Acquiring, or in Conjunction with Selling, Goods or Services, codified into ASC 505 Equity. The measurement date for the fair value of the equity instruments issued is determined at the earlier of (i) the date at which a commitment for performance by the consultant or vendor is reached or (ii) the date at which the consultant or vendor's performance is complete. In the case of equity instruments issued to consultants, the fair value of the equity instrument is recognized over the term of the consulting agreement at various performance completion dates, and for unvested instruments, at each reporting date. Compensation expense, once recorded, may not be reversed.

 

Recently Issued Accounting Standards

 

The Company has implemented all new accounting pronouncements that are in effect and that may impact its financial statements and does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position and result of operations.

 

Trends and Uncertainties

 

Demand for our products is dependent on general economic conditions, which are cyclical in nature. Because a major portion of our activities are the receipt of revenues from our services and products, our business operations may be adversely affected by competitors and prolonged recessionary periods.

 

There are no other known trends, events or uncertainties that have, or are reasonably likely to have, a material impact on our short-term or long-term liquidity. Sources of liquidity will come from the sale of our products and services. There are no material commitments for capital expenditure at this time. There are no trends, events or uncertainties that have had or are reasonably expected to have a material impact on the net sales or revenues or income from continuing operations. There are no significant elements of income or loss that do not arise from the registrant’s continuing operations. There are no other known causes for any material changes from period to period in one or more line items of our financial statements.

 

 

  8  

 

 

Impact of COVID-19

 

During the year 2020, the effects of a new coronavirus (“COVID-19”) and related actions to attempt to control its spread began to impact our business. The impact of COVID-19 on our operating results for the year ended December 31, 2020 was limited, in all material respects, due to the government mandated numerous measures, including closures of businesses, limitations on movements of individuals and goods, and the imposition of other restrictive measures, in its efforts to mitigate the spread of COVID-19 within the country.

 

On March 11, 2020, the World Health Organization designated COVID-19 as a global pandemic. Governments around the world have mandated, and continue to introduce, orders to slow the transmission of the virus, including but not limited to shelter-in-place orders, quarantines, significant restrictions on travel, as well as work restrictions that prohibit many employees from going to work. Uncertainty with respect to the economic effects of the pandemic has introduced significant volatility in the financial markets.

 

Results of Operations for the Year Ended December 31, 2020 compared to the year ended December 31, 2019

 

For both years ended December 31, 2020 and 2019, we had no revenues.

 

Our operating expenses for the year ended December 31, 2020 were $37,296 compared to $22,600 or the year ended December 31, 2019. The 2019 period included $20,000 in professional fees for the issuance of common stock to consultants for assisting with the Tribal Rides asset purchase. In the 2020 period, we incurred the following expenses which we did not incur in the 2019 period: legal and accounting fees of $11,385, other professional fees of $8,625, filing fees of $3,088, rent of $4,740 telephone of $2,820 and advertising and promotion of $1,260.

 

Our other expense for the year ended December 31, 2020 consisted of interest expense of $2,000 which was the same for the year ended December 31, 2019. In addition, in the 2019 period we recorded a gain on the extinguishment of accounts payable of $620.

 

Our net loss for the year ended December 31, 2020 of $39,296 ($0.00 per share) compares to a net loss of $23,980 ($0.00 per share) in the previous year.

  

Liquidity and Capital Resources

 

We have previously raised capital through debt financing, advances from related parties and private placements of our common stock to meet operating needs. As of December 31, 2020, we have no cash, and we will need to raise additional funds to execute our current plan of operation. We currently have no written commitment from anyone to contribute funds to our Company. If we are unable to raise sufficient funds to execute our plan of operation, we intend to scale back our operations commensurately with the funds available to us. If we are unable to obtain adequate capital, we could be forced to cease operations.

 

We have no plant or significant equipment to sell, nor are we going to buy any plant or significant equipment during the next 12 months.

 

Balance Sheets

 

As of December 31, 2020, we had no cash and total assets of $3,273 compared with no assets as of December 31, 2019. Our total liabilities increase in the 2020 period compared to 2019 by $38,932 due to increases in accounts payable and accrued liabilities as well as related party advances.

 

During the year ended December 31, 2020 we issued 25,000,000 shares of our common stock in connection with the Asset Purchase Agreement.

 

Cash Flows

 

During the years ended December 31, 2020 and 2019, we used no cash for operating activities. In addition, there were no cash flows from investing activities or financing activities in either the years ended December 31, 2020 or 2019.

 

 

 

 

 

  9  

 

 

Off-Balance Sheet Arrangements

 

We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future material effect on our consolidated financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity capital expenditures or capital resources.

 

Emerging Growth Company

 

We are an “emerging growth company,” as defined in the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. Certain specified reduced reporting and other regulatory requirements that are available to public companies that are emerging growth companies include:

 

  1. an exemption from the auditor attestation requirement in the assessment of our internal controls over financial reporting required by Section 404 of the Sarbanes-Oxley Act of 2002;
  2. an exemption from the adoption of new or revised financial accounting standards until they would apply to private companies;
  3. an exemption from compliance with any new requirements adopted by the Public Company Accounting Oversight Board, or the PCAOB, requiring mandatory audit firm rotation or a supplement to the auditor’s report in which the auditor would be required to provide additional information about our audit and our financial statements; and
  4. reduced disclosure about our executive compensation arrangements.

 

We have elected to take advantage of the exemption from the adoption of new or revised financial accounting standards until they would apply to private companies. As a result of this election, our financial statements may not be comparable to public companies required to adopt these new requirements. 

 

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 

As a “smaller reporting company,” we are not required to furnish information under this Item 7A.

 

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

 

The financial statements and supplementary data required by this item are included following the signature page of this Annual Report.

 

 

 

  10  

 

 

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

 

None.

 

ITEM 9A. CONTROLS AND PROCEDURES

 

Disclosure Controls and Procedures

 

We have established disclosure controls and procedures that are designed to ensure that information required to be disclosed in reports filed or submitted under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission and, as such, is accumulated and communicated to our Chief Executive Officer and Chief Financial Officer, Joseph Grimes, who serves as our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure. Mr. Grimes, evaluated the effectiveness of our disclosure controls and procedures, as defined in Rule 13a-15(e) of the Exchange Act, as of December 31, 2020. Based on his evaluation, Mr. Grimes concluded that, due to a material weakness in our internal control over financial reporting as described below, our disclosure controls and procedures were not effective as of December 31, 2020. In light of the material weakness in internal control over financial reporting, we completed substantive procedures, including validating the completeness and accuracy of the underlying data used for accounting prior to filing this Annual Report.

 

These additional procedures have allowed us to conclude that, notwithstanding the material weakness in our internal control over financial reporting, the consolidated financial statements included in this report fairly present, in all material respects, our financial position, results of operations and cash flows for the periods presented in conformity with accounting principles generally accepted in the United States of America.

 

Management’s Report on Internal Control over Financial Reporting

 

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rule 13a-15(f). Internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.

 

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

  

Management conducted an evaluation of the effectiveness of our internal control over financial reporting as of December 31, 2020 based upon Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”).

 

During its evaluation, management noted certain matters involving internal control and its operation that we consider to be significant deficiencies or material weaknesses under standards of the Public Company Accounting Oversight Board (“PCAOB”). A control deficiency exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent or detect misstatements on a timely basis.

 

A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Company’s annual or interim financial statements will not be prevented or detected on a timely basis.

 

We noted deficiencies involving lack of segregation of duties, lack of governance/oversight, and lack of internal control documentation that we believe to be material weaknesses.

 

 

 

  11  

 

 

Because of this material weaknesses, management concluded that we did not maintain effective internal control over financial reporting as of December 31, 2020, based on criteria described in Internal Control – Integrated Framework (2013) issued by COSO.

 

Remediation of the Material Weakness

 

We are evaluating the material weaknesses and developing a plan of remediation to strengthen our overall internal control over financial reporting. The remediation plan will include the following actions:

 

  · Separation of corporate responsibilities, e.g. CEO, CFO, Secretary, etc. to different key management individuals; and
  · Creation and adoption of a formal policy manual specifically dealing with financial controls.

 

We are committed to maintaining a strong internal control environment and we believe that these remediation efforts will represent significant improvements in our controls. Some of these steps will take time to be fully integrated and confirmed to be effective and sustainable. Additional controls may also be required over time. Until the remediation steps set forth above are fully implemented and tested, the material weakness described above will continue to exist.

 

Changes in Internal Control over Financial Reporting

 

There has been no change in our internal control over financial reporting, as defined in Rules 13a-15(f) of the Exchange Act, during our most recent fiscal quarter ended December 31, 2020, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

 

Important Considerations

 

The effectiveness of our disclosure controls and procedures and our internal control over financial reporting is subject to various inherent limitations, including cost limitations, judgments used in decision making, assumptions about the likelihood of future events, the soundness of our systems, the possibility of human error, and the risk of fraud. Moreover, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions and the risk that the degree of compliance with policies or procedures may deteriorate over time. Because of these limitations, there can be no assurance that any system of disclosure controls and procedures or internal control over financial reporting will be successful in preventing all errors or fraud or in making all material information known in a timely manner to the appropriate levels of management.

 

ITEM 9B. OTHER INFORMATION

 

Effective February 24, 2021, we filed an amendment to our Articles of Incorporation to change the name of the Company to “Tribal Rides International Corp.”

 

 

 

 

 

 

 

 

  12  

 

PART III

 

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.

 

Current Management

 

The following table sets forth information concerning our executive officers and directors:

 

Name   Position   Director Since   Age  
Executive Officers and Directors              
Joseph Grimes   Chief Executive Officer, Chief Financial Officer, Director   January 18, 2020   63
Sanjay Prasad, Esq.   Director   June 1, 2020   55
Steven Ritacco   Director   June 1, 2020   56
                 

 

Directors are elected to serve until the next annual meeting of stockholders and until their successors are elected and qualified. A majority of the authorized number of directors constitutes a quorum of the Board of Directors for the transaction of business. The directors must be present at the meeting to constitute a quorum. However, any action required or permitted to be taken by the Board of Directors may be taken without a meeting if all members of the Board of Directors individually or collectively consent in writing to the action.

 

Business Experience of Executive Officers and Directors

 

The principal occupation and business experience during the past five years for our executive officers and directors is as follows:

 

Joseph Grimes: Mr. Grimes has served as our Chief Executive Officer, Chief Financial Officer, and director since January 18, 2020. Mr. Grimes has over 20 years of executive and managerial level positions leading large teams who successfully executed complex business strategies. His notable achievements include launching new products and companies, and establishing new software development and manufacturing enterprises domestically and overseas. For 12 years, he was Founder and President of ISERA Group, where he directed efforts resulting in 12 Small Business Innovative Research Grants, managed 5 teams of software designers and developed sophisticated Decision Support Software Systems (DSSS) for Commercial, Military and Government sectors. He is the Founder and CEO of Tribal Rides, Inc from 2014 to present.

 

He has programming experience in OOP in C++ and VB with Access and SQL Server, DBMS.

 

Sanjay Prasad, Esq.: Mr. Prasad has served as a director since June 1, 2020. From July 2020 until the present, Mr. Prasad has been a partner at Appleton Luff, a boutique international law firm. From July 2013 until July 2020, Mr. Prasad was a principal at Prasad IP, PC., a law firm specializing in intellectual property.

 

Steven Ritacco: Mr. Ritacco has served as a director since June 1, 2020. From April 2001 until the present, Mr. Ritacco has served as President of KeptPrivate Inc./Proxemi. From September 2015 until March 2018, Mr. Ritacco served as Chief Technology Officer of Blue NRGY Group Ltd. Mr. Ritacco received an undergraduate degree from the University of Rhode Island.

 

Legal Proceedings

 

During the past ten years there have been no events under any bankruptcy act, no criminal proceedings and no judgments, injunctions, orders or decrees material to the evaluation of the ability and integrity of any of our directors or executive officers, and none of these persons has been involved in any judicial or administrative proceedings resulting from involvement in mail or wire fraud or fraud in connection with any business entity, any judicial or administrative proceedings based on violations of federal or state securities, commodities, banking or insurance laws or regulations, or any disciplinary sanctions or orders imposed by a stock, commodities or derivatives exchange or other self-regulatory organization.

 

Family Relationships

 

There are no family relationships between any of our directors and executive officers.

 

 

 

  13  

 

 

Director Independence

 

We are not currently subject to listing requirements of any national securities exchange or inter-dealer quotation system which has requirements that a majority of the board of directors be “independent” and, as a result, we are not at this time required to have our Board of Directors comprised of a majority of “independent directors.”

  

We currently have not established any committees of the Board of Directors. Our Board of Directors may designate from among its members an executive committee and one or more other committees in the future. We do not have a nominating committee or a nominating committee charter. Further, we do not have a policy with regard to the consideration of any director candidates recommended by security holders. To date, other than as described above, no security holders have made any such recommendations. The entire Board of Directors performs all functions that would otherwise be performed by committees. Given the present size of our board it is not practical for us to have committees. If we are able to grow our business and increase our operations, we intend to expand the size of our board and allocate responsibilities accordingly.

 

Code of Ethics

 

We have not adopted a Code of Ethics. We have had minimal operations or business and have not generated any revenues and have limited members of management, including one sole executive officer. Due to this, we feel that the adoption of a Code of Ethics would not serve the primary purpose of such a code to provide a manner of conduct as the development, execution and enforcement of such a code would be by the same persons and only persons to whom such code applied. At such time as we commence more significant business operations, the current officers and directors will recommend that such a code be adopted.

 

ITEM 11. EXECUTIVE COMPENSATION

 

During the years ended December 31, 2020 and 2019, there was no compensation awarded to, earned by, or paid to our named executive officer for all services rendered in all capacities to our Company.

 

In the future, we may elect to award a cash bonus to key employees, directors, officers and consultants based on meeting individual and corporate planned objectives.

 

Equity Awards

 

The following table sets forth information concerning as of the year ended December 31, 2020 for our named executive officers.

  

Outstanding Equity Awards at Fiscal Year-End

 

    Stock awards
Name   Number of
shares or units
of stock
that have
not vested
(#)
  Market value
of shares of
units of stock
that have
not vested
($)
 

Equity incentive
plan awards:

Number of
unearned shares,
units or other
rights that have
not vested
(#)

 

Equity incentive
plan awards:

Market or
payout value
of unearned
shares, units
or other rights
that have not vested
($)

   
Joseph Grimes   100,000   1,000(1)   100,000   1,000    

 

(1) The fair market value was deemed $0.01 per share.

 

Director Compensation

 

During the year ended December 31, 2020, there was no compensation awarded to, earned by, or paid to our directors for all services rendered in their capacities to our Company.

 

 

 

 

  14  

 

 

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDERS MATTERS

 

The following table and footnotes thereto sets forth information regarding the number of shares of common stock beneficially owned by (i) each director and named executive officer of our company, (ii) each person known by us to be the beneficial owner of 5% or more of its issued and outstanding shares of common stock, and (iii) named executive officers, executive officers, and directors of the Company as a group as of September 27, 2021. In calculating any percentage in the following table of common stock beneficially owned by one or more persons named therein, the following table assumes 36,057,500 shares of common stock outstanding. Unless otherwise further indicated in the following table, the footnotes thereto and/or elsewhere in this report, the persons and entities named in the following table have sole voting and sole investment power with respect to the shares set forth opposite the shareholder’s name, subject to community property laws, where applicable. Unless as otherwise indicated in the following table and/or the footnotes thereto, the address of our named executive officers and directors in the following tables is: 26060 Acero, Mission Viejo, CA 92691.

 

Name and Address of Beneficial Owner   Amount and
Nature of
Beneficial
Ownership(1)
    Percent
of Class(1)
 
Named Executive Officers and Directors                  
Joseph Grimes     25,000,000(2)       69.33%    
Sanjay Prasad, Esq.     0          
Steven Ritacco     0          
Executive Officers, Named Executive Officers, and Directors as a Group (3 Persons)     25,000,000       69.33%    
5% Beneficial Holders (Not Named Above)                  

Tribal Rides

25108 Marguerite Pkwy, Ste A 450

Mission Viejo, CA 92692

    25,000,000       69.33%    

GG Capital and Investment Corp

123 West Nye Lane #129

Carson Coty, NV 89706

    2,000,000(6)       5.55%    

Baywall Inc

140 Charles St, Suite 11D

New York, NY 10014

    2,200,000(7)       6.10%    
                           

 

*Less than 1% 

 

  (1) Under Rule 13d-3 of the Exchange Act, a beneficial owner of a security includes any person who, directly or indirectly, through any contract, arrangement, understanding, relationship, or otherwise has or shares: (i) voting power, which includes the power to vote, or to direct the voting of shares; and (ii) investment power, which includes the power to dispose or direct the disposition of shares. Certain shares may be deemed to be beneficially owned by more than one person (if, for example, persons share the power to vote or the power to dispose of the shares). In addition, shares are deemed to be beneficially owned by a person if the person has the right to acquire the shares (for example, upon exercise of an option) within 60 days of the date as of which the information is provided. In computing the percentage ownership of any person, the amount of shares outstanding is deemed to include the number of shares beneficially owned by such person (and only such person) by reason of these acquisition rights. As a result, the percentage of outstanding shares of any person as shown in the above table does not necessarily reflect the person’s actual ownership or voting power with respect to the number of shares of common stock actually outstanding on the September 27, 2021.
  (2) Mr. Grimes is the Chief Executive Officer of Tribal Rides.

 

 

 

 

 

  15  

 

  

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE

 

Certain Relationships and Related Transactions

 

For transactions with our executive officers, please see the disclosure under “Item 11. Executive Compensation.” above.

 

On January 18, 2020, we entered into an Asset Purchase Agreement with Tribal Rides pursuant to which we purchased certain assets of Tribal Rides in exchange for the issuance of 25,000,000 shares of the Company’s Common Stock. Mr. Grimes, our CEO, is also the CEO of Tribal Rides. Mr. Grimes is also a shareholder of Tribal Rides.

 

Director Independence

 

We are not currently subject to listing requirements of any national securities exchange or inter-dealer quotation system which has requirements that a majority of the board of directors be “independent” and, as a result, we are not at this time required to have our Board of Directors comprised of a majority of “independent directors.” Although we have not have adopted the independence standards any national securities exchange to determine the independence of directors, the NYSE MKT LLC provides that a person will be considered an independent director if he or she is not an officer of the company and is, in the view of our board of directors, free of any relationship that would interfere with the exercise of independent judgment. Under this standard, our board of directors has determined that Messrs. Prasad and Ritacco would meet this standard, and therefore, would be considered to be independent.

 

ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES.

 

Fees Paid

 

Audit Fees

 

The aggregate fees billed for professional services rendered by our principal accountants for the audit of our annual financial statements, review of financial statements included in the quarterly reports and other fees that are normally provided by the accountant in connection with statutory and regulatory filings or engagements for the year ended December 31, 2020 were $12,000 and $12,000 for the period ended December 31, 2019.

 

Audit-Related Fees

 

There were no fees billed for assurance and related services by our principal accountants that are reasonably related to the performance of the audit or review of the financial statements, other than those reported above, for the years ended December 31, 2020 and 2019.

 

Tax Fees

 

There were no fees billed for professional services rendered by our principal accountants for tax compliance, tax advice and tax planning in the years ended December 31, 2020 and 2019.

 

All Other Fees

 

There were no other fees billed for products or services provided by the principal accountants, other than those previously reported above, for the years ended December 31, 2020 and 2019.

 

Audit Committee

 

We do not have an Audit Committee; therefore, the Board of Directors has considered whether the non-audit services provided by our auditors to us are compatible with maintaining the independence of our auditors and concluded that the independence of our auditors is not compromised by the provision of such services. Our Board of Directors pre-approves all auditing services and permitted non-audit services, including the fees and terms of those services, to be performed for us by our independent auditor prior to engagement.

 

 

  16  

 

 

PART IV

 

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES

 

Financial Statements

 

The following financial statements are filed with this Annual Report:

 

Report of Independent Registered Public Accounting Firm

 

Balance Sheets at December 31, 2020 and 2019

 

Statements of Operations for the years ended December 31, 2020 and 2019

 

Statements of Changes in Stockholders’ Deficit for the years ended December 31, 2020 and 2019

 

Statements of Cash Flows for the years ended December 31, 2020 and 2019

 

Notes to Financial Statements

 

Exhibits

 

The following exhibits are included with this Annual Report:

 

Incorporated by Reference      
Exhibit
Number
  Exhibit Description   Form   File No.   Exhibit   Filing 
Date
  Filed or Furninshed
Herewith
2.1 & 10.1   Asset Purchase Agreement dated January 18, 2020                   X
3.1   Articles of Incorporation filed May 19, 2014   S-1/A   333-200344   3.1   1/30/15    
3.2   Articles of Amendment filed May 8, 2017   8-K   333-200344   3.1   7/10/17    
3.3**   Certificate of Amendment filed February 25, 2021                    
3.4   Bylaws   S-1   333-200344   3.2   11/18/14    
4.1**   2020 Stock Incentive Plan                   X
10.2**   Stock Option Agreement                   X
31.1**   Rule 13a-14(a) Certification by Principal Executive Officer                   X
31.2**   Rule 13a-14(a) Certification by Principal Financial Officer                   X
32.1**   Section 1350 Certification of Principal Executive Officer                   X
32.2**   Section 1350 Certification of Principal Financial Officer                   X
101.INS   XBRL Instance Document                   X
101.SCH   XBRL Taxonomy Extension Schema Document                   X
101.CAL   XBRL Taxonomy Extension Calculation Linkbase Document                   X
101.DEF   XBRL Taxonomy Extension Definition Linkbase Document                   X
101.LAB   XBRL Taxonomy Extension Label Linkbase Document                   X
101.PRE   XBRL Taxonomy Extension Presentation Linkbase Document                   X

 

 

ITEM 16. FORM 10-K SUMMARY

 

None.

 

SIGNATURE PAGE FOLLOWS

 

 

 

 

 

  17  

 

SIGNATURES

 

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

  TRIBAL RIDES INTERNATIONAL CORP.
     
     
Date: September 27, 2021 By: /s/ Joseph Grimes
    Joseph Grimes, Chief Executive Officer and Chief Financial Officer
    (Principal Executive Officer and Principal Financial Officer)

 

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the date indicated.

 

NAME   TITLE   DATE
         
/s/ Joseph Grimes   Director   September 27, 2021
Joseph Grimes        
         
/s/ Sanjay Prasad   Director   September 27, 2021
Sanjay Prasad, Esq.        
         
/s/ Steven Ritacco   Director   September 27, 2021
Steven Ritacco        

 

 

 

 

 

 

  18  

 

 

INDEX TO FINANCIAL STATEMENTS

 

    Page
     
Report of Independent Registered Public Accounting Firm   F-2
     
Balance Sheets at December 31, 2020 and 2019   F-3
     
Statements of Operations for the years ended December 31, 2020 and 2019   F-4
     
Statements of Changes in Stockholders’ Deficit for the years ended December 31, 2020 and 2019   F-5
     
Statements of Cash Flows for the years ended December 31, 2020 and 2019   F-6
     
Notes to Financial Statements   F-7

 

 

 

 

 

 

 

  F-1  
 

 

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 

To the Board of Directors and Shareholders of Tribal Rides International Corp.

 

Opinion on the Financial Statements

 

We have audited the accompanying balance sheets of Tribal Rides International Corp. (the “Company”) as of December 31, 2020 and 2019, the related statements of operations, stockholders’ deficit, and cash flows for the years then ended, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2020 and 2019, and the results of its operations and its cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States.

 

Going Concern Matter

 

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2 to the financial statements, the Company has no revenue, suffered recurring losses from operations and has a net capital deficiency that raises substantial doubt about its ability to continue as a going concern. Management’s plans regarding these matters are also described in Note 2 to the financial statements. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

 

Basis for Opinion

 

These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

 

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audit, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

 

Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.

 

Critical Audit Matters

 

Critical audit matters are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the board of directors and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. We determined that there are no critical audit matters.

 

 

/s/ TAAD LLP

 

TAAD LLP

 

We have served as the Company’s auditor since 2021

Diamond Bar, California

September 27, 2021

 

 

  F-2  
 

 

TRIBAL RIDES INTERNATIONAL CORP.

(formerly XINDA INTERNATIONAL CORP.)

BALANCE SHEETS

 

 

 

 

    December 31,
2020
   

December 31,

2019

 
ASSETS                
                 
Noncurrent assets:                
Patents, net     3,273        
Total noncurrent assets     3,273        
Total Assets   $ 3,273     $  
                 
LIABILITIES AND STOCKHOLDERS’ DEFICIT                
Current liabilities:                
Accounts payable and accrued liabilities   $ 26,584     $ 11,509  
Note payable     40,000       40,000  
Due to related party     23,857        
Total current liabilities     90,441       51,509  
Total Liabilities     90,441       51,509  
                 
Commitments and contingencies            
                 
Stockholders’ deficit:                
Common stock, $0.0001 par value, 50,000,000 shares authorized; 36,057,500 and 11,057,500 shares issued and outstanding at December 31, 2020 and 2019, respectively     3,606       1,106  
Additional paid-in capital     87,979       86,842  
Accumulated deficit     (178,753 )     (139,457 )
Total Stockholders’ Deficit     (87,168 )     (51,509 )
Total Liabilities and Stockholders’ Deficit   $ 3,273     $  

 

 

 

See accompanying Notes to Financial Statements

 

 

 

 

  F-3  
 

 

TRIBAL RIDES INTERNATIONAL CORP.

(formerly XINDA INTERNATIONAL CORP.)

STATEMENTS OF OPERATIONS

 

 

 

 

   

For the Twelve

Months Ended
December 31,

2020

    For the Twelve
Months Ended
December 31,
2019
 
Operating expenses:                
Selling and marketing   $ 3,140     $  
General and administrative     34,156       22,600  
Total operating expense     37,296       22,600  
                 
Operating loss     (37,296 )     (22,600 )
                 
Other income (expense):                
Interest expense     (2,000 )     (2,000 )
Gain on extinguishment of debt           620  
Total other income (expense)     (2,000 )     (1,380 )
                 
Loss before provision for income taxes     (39,296 )     (23,980 )
                 
Provision for income taxes            
                 
Net loss   $ (39,296 )   $ (23,980 )
                 
Weighted average shares basic and diluted     35,374,440       6,056,952  
                 
Weighted average basic and diluted loss per common share   $ (0.00 )   $ (0.00 )

 

 

 

See accompanying Notes to Financial Statements

 

 

 

 

  F-4  
 

 

 

TRIBAL RIDES INTERNATIONAL CORP.

(formerly XINDA INTERNATIONAL CORP.)

STATEMENTS OF STOCKHOLDERS’ DEFICIT

 

 

 

 

    Common Stock     Additional Paid-In     Accumulated     Total Stockholders’  
    Shares     Amount     Capital     Deficit     (Deficit)  
Balance – December 31, 2018     5,857,500     $ 586     $ 67,362     $ (115,477 )   $ (47,529 )
Shares issued for services     5,200,000       520       19,480             20,000  
Net loss                       (23,980 )     (23,980 )
Balance – December 31, 2019     11,057,500       1,106       86,842       (139,457 )     (51,509 )
Shares issued in connection with Asset Purchase Agreement     25,000,000       2,500       1,137             3,637  
Net loss                       (39,296 )     (39,296 )
Balance – December 31, 2020     36,057,500     $ 3,606     $ 87,979     $ (178,753 )   $ (87,168 )

 

 

 

See accompanying Notes to Financial Statements

 

 

 

 

 

 

 

 

  F-5  
 

 

TRIBAL RIDES INTERNATIONAL CORP.

(formerly XINDA INTERNATIONAL CORP.)

STATEMENTS OF CASH FLOWS

 

 

 

   

For the Twelve

Months Ended

December 31,

2020

   

For the Twelve

Months Ended

December 31,

2019

 
Cash flows from operating activities:                
Net loss   $ (39,296 )   $ (23,980 )
Adjustment to reconcile net loss to net cash used in operating activities:                
Shares issued for services           20,000  
Gain on extinguishment of debt           (620 )
Amortization     364        
Changes in operating assets/liabilities:                
Accounts payable and accrued liabilities     15,076       4,600  
Due to related parties     23,856        
Net cash used in operating activities            
                 
Net change in cash            
Cash, beginning of period            
Cash, end of period   $     $  
                 
Supplemental disclosures of cash flow information                
Cash paid during the period for:                
Interest   $     $  
Taxes   $     $  
                 
Supplemental disclosures of non-cash investing and financing activities:                
Shares issued for Asset Purchase Agreement   $ 3,637     $  

 

 

 

See accompanying Notes to Financial Statements

 

 

 

 

 

  F-6  
 

 

TRIBAL RIDES INTERNATIONAL CORP.

(formerly XINDA INTERNATIONAL CORP.)

NOTES TO FINANCIAL STATEMENTS

 

 

 

1. Organization and Business

 

Organization and Business

 

 

We were incorporated on May 19, 2014 in the State of Nevada as Trimax Consulting, Inc. with an initial business plan of providing real estate consulting services and purchasing tax liens. On March 16, 2017, Newfield Global Holdings Limited acquired 25.0 million shares of our common stock representing 96.3% of our then outstanding shares. Upon election of a new Board of Directors and appointment of new management, we altered our business plan to provide end-to-end Human Resource services including recruitment, executive search, campus recruitment, training, and a complete range of Human Resource outsourcing solutions to clients. On May 8, 2017, we filed an Amendment to our Articles of Incorporation changing our name to Xinda International Corp. On February 24, 2021, we filed an Amendment to our Articles of Incorporation changing our name to Tribal Rides International Corp. Our ticker symbol is XNDA.

 

As reported in our Form 8-K dated January 18, 2020, we entered into an Asset Purchase Agreement (the “Agreement”) effective January 10, 2020 with Tribal Rides, Inc., a Nevada corporation (“TribalRides”), and the shareholders of TribalRides (the “Shareholders”). Under the Agreement, we agreed to purchase a majority of the assets of TribalRides, consisting of patent and patent pending technologies in the area of digital transformation of transportation, in exchange for the issuance of 25,000,000 shares of our common stock. See Note 3 for further information.

 

As a result of our asset purchase described above, we are now engaged, in the research and development stage, in the business of digital transformation of transportation. The digital transportation enablement and enhancement platform provides fully automated dispatching and bookings management built for taxi companies, limousine companies and ride-sharing service providers. The platform gives customers an app-based experience and provides service providers a range of functions which include customer booking, accounts management, driver tracking, real-time notifications, auto dispatching algorithms, accounting and settlements, corporate account management as well as providing reporting and analytics. The platform has also shown to have a direct application in the B2B space in providing corporations with a more efficient taxi chit solution to combat fraud and excessive administration costs.

 

 

 

 

  F-7  
 

 

2. Summary of Significant Accounting Policies

 

Basis of Presentation

 

We have prepared the accompanying financial statements in conformity with generally accepted accounting principles in the United States of America pursuant to the rules and regulations of the United States Securities and Exchange Commission (“SEC”). Our Company’s year-end is December 31.

 

Going Concern Considerations

 

The accompanying financial statements have been prepared in conformity with generally accepted accounting principles in the United States of America, which contemplate continuation of our Company as a going concern. We currently have no revenues, have incurred net losses, and have an accumulated deficit of $178,753 as of December 31, 2020. The continuation of our Company as a going concern is dependent upon our ability to raise equity or debt financing, and the attainment of profitable operations from any future business we may acquire. There are no assurances that we will be successful in obtaining sufficient capital to continue as a going concern. If our working capital needs are not met and we are unable to obtain adequate capital, we could be forced to cease operations.

  

The accompanying financial statements do not include any adjustments that might be necessary if our Company is unable to continue as a going concern.

 

Use of Estimates

 

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

 

Cash and Cash Equivalents 

 

We consider all short-term investments readily convertible to cash, without notice or penalty, with an initial maturity of 90 days or less to be cash equivalents. There is no cash at December 31, 2020 or 2019.

 

Intellectual Property

 

We have patent and patent pending technologies with a focus on artificial intelligence (“AI”), machine learning with optimization and Smart Deployment algorithms. It involves anticipating demand for passengers and dispatching cars in advance – to reduce wait-time, increasing utilization of vehicles, and decrease cost. It includes new and efficient system for tracking and charging customers with preferred rates, supply and demand rates, and “specific” community engagement.

 

Patent expenses, consisting mainly of patent filing fees, have been capitalized and are shown as an asset on our balance sheet. We amortize our Patent asset over the remaining life of the Patent, which is approximately ten (10) years. 

 

 

 

 

  F-8  
 

 

Fair Value of Financial Instruments

 

Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants as of the measurement date. Applicable accounting guidance provides an established hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in valuing the asset or liability and are developed based on market data obtained from sources independent of our Company. Unobservable inputs are inputs that reflect our Company’s assumptions about the factors that market participants would use in valuing the asset or liability. There are three levels of inputs that may be used to measure fair value:

 

  Level 1 - Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.
  Level 2 - Other inputs that are directly or indirectly observable in the marketplace.
  Level 3 - Unobservable inputs which are supported by little or no market activity.

 

As previously noted, the fair value hierarchy requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.

  

Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management as of December 31, 2020 and 2019. The respective carrying value of certain on-balance-sheet financial instruments approximated their fair values. These financial instruments include accounts payable and accrued liabilities and related-party advances. Fair values for these items were assumed to approximate carrying values because of their short-term nature or their status of being payable on demand.

 

Long-lived Assets

 

We follow ASC 360-10-15-3, Impairment or Disposal of Long-lived Assets, which established a “primary asset” approach to determine the cash flow estimation period for a group of assets and liabilities that represents the unit of accounting for a long-lived asset to be held and used.  Long-lived assets to be held and used are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The carrying amount of a long-lived asset is not recoverable if it exceeds the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset. Long-lived assets to be disposed of are reported at the lower of carrying amount or fair value less cost to sell.

 

Common Stock Issued for Services

 

Our accounting policy for equity instruments issued to consultants and vendors in exchange for goods and services follows the provisions of Emerging Issues Task Force (“EITF”) 96-18, Accounting for Equity Instruments That are Issued to Other Than Employees for Acquiring, or in Conjunction with Selling, Goods or Services, codified into ASC 505 Equity. The measurement date for the fair value of the equity instruments issued is determined at the earlier of (i) the date at which a commitment for performance by the consultant or vendor is reached or (ii) the date at which the consultant or vendor's performance is complete. In the case of equity instruments issued to consultants, the fair value of the equity instrument is recognized over the term of the consulting agreement at various performance completion dates, and for unvested instruments, at each reporting date. Compensation expense, once recorded, may not be reversed.

 

 

 

 

 

  F-9  
 

 

Income Taxes

 

We account for income taxes in accordance with ASC 740 - Income Taxes, which requires us to provide a net deferred tax asset/liability equal to the expected future tax benefit/expense of temporary reporting differences between book and tax accounting methods and any available operating loss or tax credit carry forwards. Tax law and rate changes are reflected in income in the period such changes are enacted. We record a valuation allowance to reduce the deferred tax assets to the amount that is more likely than not to be realized. We include interest and penalties related to income taxes, including unrecognized tax benefits, within the provision for income taxes.

 

Our income tax returns are based on calculations and assumptions that are subject to examination by the Internal Revenue Service and other tax authorities. In addition, the calculation of our tax liabilities involves dealing with uncertainties in the application of complex tax regulations. We recognize liabilities for uncertain tax positions based on a two-step process. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount that is more than 50% likely of being realized upon settlement. While we believe we have appropriate support for the positions taken on our tax returns, we regularly assess the potential outcomes of examinations by tax authorities in determining the adequacy of our provision for income taxes. We continually assess the likelihood and amount of potential adjustments and adjust the income tax provision, income taxes payable and deferred taxes in the period in which the facts that give rise to a revision become known.

 

Net Loss Per Share

 

We compute net income (loss) per share in accordance with ASC 260, Earnings per Share. ASC 260 requires presentation of both basic and diluted earnings per share (“EPS”) on the face of the income statement. Basic EPS is computed by dividing net income (loss) available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. Diluted EPS excludes all potential dilutive shares if their effect is anti-dilutive. As of December 31, 2020 and 2019, we had no potentially dilutive shares.

 

New Accounting Pronouncements

 

We have reviewed all accounting pronouncements recently issued by the FASB (including its Emerging Issues Task Force), the AICPA, and the SEC and have determined that they are either not applicable or are not believed to have a material impact on our present or future financial statements.

 

3. Asset Purchase Agreement

 

As described in Note 1, we entered into the Agreement with TribalRides and its shareholders to purchase the patent and patent pending technologies owned by TribalRides in exchange for our Company’s issuance of 25,000,000 of our common shares. We have valued the shares issued in this transaction at the recorded value of the patent assets purchased which was $3,637 at the date of the transaction. See Note 4.

 

 

 

 

  F-10  
 

 

4. Patents

 

We have patent and patent pending technologies with a focus on artificial intelligence (“AI”), machine learning with optimization and Smart Deployment algorithms. The technologies involve anticipating demand for passengers and dispatching cars in advance – to reduce wait-time, increasing utilization of vehicles, and decrease cost. It includes new and efficient system for tracking and charging customers with preferred rates, supply and demand rates, and “specific” community engagement.

 

We currently own the following patents which have been issued and which are pending: 

 

  · U.S. Patent 9,984,574, issued May 29, 2018, claims priority to provisional application filed on Jan. 21, 2014;
  · Pending U.S. application, published as US 2018/0366004 A1, claims priority to provisional application filed on Jan. 21, 2014; and
  · Pending U.S. application, unpublished, claims priority to three provisional applications filed on Nov. 4, 2019.

 

The software platform that underlies the patents have not created any revenue to date and there is no assurance that any revenue will be created from the patent technologies. As a result, we have recorded the patent asset at the cost of patent fees and other expenses incurred to produce and file the patents. During the year ended December 31, 2020, we recorded patent amortization expense of $364.

 

5. Related Parties Transactions

 

Due to Related Parties

 

The amount owed to related party as of December 21, 2020 totaling $23,857 represents advances from our CEO, Mr. Joe Grimes. The amount due to related party bears no interest, is unsecured and is repayable on demand.

 

Asset Purchase Agreement

 

The CEO and majority stockholder of TribalRides, Mr. Joe Grimes, is also now the CEO of our Company. As a result of the Agreement described in Note 3, Mr. Grimes is now beneficially the majority owner of our Company.

 

6. Note Payable

 

On May 29, 2018, we issued a note payable to a service provider in the principal amount of $40,000. The note bears interest at 5% per annum and was repayable six months from the date of issue. The note continues to be outstanding but there are no default provisions in the note. During the years ended December 31, 2020 and 2019, we recorded interest expense of $2,000 which amounts are included on the accompanying Balance Sheets in Accounts Payable and Accrued Liabilities.

 

 

 

 

 

  F-11  
 

 

7. Capital Stock

 

Common Stock

 

We are authorized to issue 50,000,000 shares of our $0.0001 par value common stock and each holder is entitled to one (1) vote on all matters subject to a vote of stockholders.

 

As described in Note 3, during the year ended December 31, 2020, we issued 25,000,000 shares of our common stock to TribalRides and its shareholders in accordance with the Agreement.

 

During the year ended December 31, 2019, we issued 5,200,000 shares of our common stock to service providers and recorded a general and administrative expense in the amount of $20,000. The value of the stock issued was based on documentation supplied by the service providers for the value of the services provided.

 

2020 Stock Incentive Plan

 

Effective June 20, 2020, our Board of Directors adopted the 2020 Stock Incentive Plan (the “Plan”) authorizing a total of 2,500,000 shares of our common stock for future issuances under the Plan. Under the Plan, the exercise price of a granted option shall not be less than 100% of the fair market value on the date of grant (110% of the fair market value in the case of a 10% stockholder). Additionally, no option may be exercisable more than ten (10) years after the date it is granted (no more than five (5) years in the case of a 10% stockholder).

 

Stock Options

 

On June 20, 2020, we granted options to purchase 100,000 of our common shares to each of Messrs. Grimes, Prasad, and Ritacco, all Officers and/or Directors of our Company. The options are exercisable at $0.01 per share, expire five (5) years from the date of grant, and vest ratably beginning December 20, 2021 over the term of the option.

 

The fair value of each stock option was estimated on the date of grant using the Black-Scholes option pricing model and resulted in a de minimis valuation. The assumptions used in determining the fair value of the stock options were as follows

 

    December 31, 2020  
Expected term in years     5 years  
Risk-free interest rate     0.33%  
Annual expected volatility     38.3%  
Dividend yield     0.00%  

 

Risk-free interest rate: We use the risk-free interest rate of a U.S. Treasury Bill with a similar term on the date of the option grant.

 

Volatility: We estimate the expected volatility of the stock price based on the corresponding volatility of our historical stock price.

 

Dividend yield: We use a 0% expected dividend yield as we have not paid dividends to date and do not anticipate declaring dividends in the near future.

 

 

 

 

  F-12  
 

 

Remaining term: The remaining term is based on the remaining contractual term of the stock options.

 

Activity related to stock options for 2020 is as follows:

 

      Shares     Weighted
Average
Exercise
Price
    Weighted
Average
Remaining
Contractual
Life in Years
    Aggregate
Intrinsic
Value
 
                           
  Outstanding, beginning of period                                
  Granted       300,000     $ 0.01                
  Outstanding, end of period       300,000     $ 0.01                  
  Exercisable, end of period           $ 0.01       4.5     $  

  

8. Income Taxes

 

Our Company has not filed any federal income tax returns and we are currently not subject to state income tax filing requirements. As of December 31, 2020, we have net operating loss carryforwards, on a book basis, of $159,373 which may be available to reduce various future years' federal taxable income. Future tax benefits which may result from these losses have not been recognized in these financial statements, as their realization is determined not likely to occur and accordingly, we have recorded a valuation allowance for the deferred tax asset relating to the net operating loss carry forwards.

  

The following table presents the current income tax provision for federal and state income taxes for the years ended December 31, 2020 and 2019:

 

    2020     2019  
Current tax provisions:                
Federal   $     $  
State            
Total provision for income taxes   $     $  

 

Reconciliations of the U.S. federal statutory rate to the actual tax rate for the years ended December 31, 2020 and 2019:

 

    2020     2019  
US federal statutory income tax rate     21.0%       21.0%  
Stock issued for services     -2.8%        
Gain on extinguishment of accounts payable           1.4%  
Increase in valuation reserve     -18.2%       -22.4%  
Total provision for income taxes     0.0%       0.0%  

 

 

 

 

 

  F-13  
 

 

The components of our deferred tax assets as of December 31, 2020 and 2019 consisted of the following:

 

    2020     2019  
Net operating loss carry forwards   $ 33,468     $ 26,308  
Less: valuation allowance     (33,468 )     (26,308 )
Net deferred tax assets   $     $  

  

During the year ended December 31, 2020, the valuation reserve increased $7,160 compared to an increase of $2,058 during the year ended and December 31, 2019. In assessing the recovery of the deferred tax assets, management considers whether it is more likely than not that our Company will not realize some portion or all of the deferred tax assets. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income in the periods in which those temporary differences become deductible. Management considers the scheduled reversals of future deferred tax assets, projected future taxable income, and tax planning strategies in making this assessment. As a result, management determined, as of December 31, 2020, that it was more likely than not the deferred tax assets would not be realized.

  

As noted above, we have not filed any federal tax returns, but we plan on bringing our tax filings current as soon as is practical. 

 

9. Subsequent Event

 

Effective September 23, 2021, we entered into a Debt Settlement Agreement (the “Debt Agreement”) with the holder of the $40,000 note payable described in Note 6. Under the Debt Agreement, the noteholder agreed to accept $5,000 in full settlement of all amounts owed under the note if the $5,000 is paid within 60 days of the execution of the Debt Agreement.

 

 

 

  F-14  

 

 

 

Exhibit 3.3

 

NEVADA STATE BUSINESS LICENSE Tribal Rides International Corp. Nevada Business Identification # NV20141353904 Expiration Date: 05/31/2021 In accordance with Title 7 of Nevada Revised Statutes, pursuant to proper application duly filed and payment of appropriate prescribed fees, the above named is hereby granted a Nevada State Business License for business activities conducted within the State of Nevada . Valid until the expiration date listed unless suspended, revoked or cancelled in accordance with the provisions in Nevada Revised Statutes. License is not transferable and is not in lieu of any local business license, permit or registration. License must be cancelled on or before its expiration date if business activity ceases. Failure to do so will result in late fees or penalties which, by law, cannot be waived . IN WITNESS WHEREOF, I have hereunto set my hand and affixed the Great Seal of State, at my office on 02/25/2021. Certificate Number: B202102251456743 You may verify this certificate online at http://www.nvsos.gov BARBARA K. CEGAVSKE Secretary of State

 
 

NEVADA STATE BUSINESS LICENSE Tribal Rides International Corp. Nevada Business Identification # NV20141353904 Expiration Date: 05/31/2021 In accordance with Title 7 of Nevada Revised Statutes, pursuant to proper application duly filed and payment of appropriate prescribed fees, the above named is hereby granted a Nevada State Business License for business activities conducted within the State of Nevada . Valid until the expiration date listed unless suspended, revoked or cancelled in accordance with the provisions in Nevada Revised Statutes. License is not transferable and is not in lieu of any local business license, permit or registration. License must be cancelled on or before its expiration date if business activity ceases. Failure to do so will result in late fees or penalties which, by law, cannot be waived . IN WITNESS WHEREOF, I have hereunto set my hand and affixed the Great Seal of State, at my office on 02/25/2021. Certificate Number: B202102251456743 You may verify this certificate online at http://www.nvsos.gov BARBARA K. CEGAVSKE Secretary of State

 
 

Filed in the Office of Secretary of State State Of Nevada Business Number E0278042014 - 8 Filing Number 20211259438 Filed On 2/24/2021 9:37:00 AM Number of Pages 1

 

 

Exhibit 4.1

 

Tribal Rides International Corp 

2020 STOCK INCENTIVE PLAN

 

 

THE 2020 STOCK INCENTIVE PLAN (the “Plan”) of Tribal Rides International Corp., a Nevada corporation, is hereby adopted by its Board of Directors as of June 20, 2020 (the “Effective Date”).

 

Article 1.

PURPOSES OF THE PLAN

 

Section 1.01         Purposes. The purposes of the Plan are (a) to enhance the Company’s ability to attract and retain the services of qualified employees, officers, directors, consultants, and other service providers upon whose judgment, initiative and efforts the successful conduct and development of the Company’s business largely depends, and (b) to provide additional incentives to such persons or entities to devote their utmost effort and skill to the advancement and betterment of the Company, by providing them an opportunity to participate in the ownership of the Company and thereby have an interest in the success and increased value of the Company.

 

Article 2.

DEFINITIONS

 

For purposes of this Plan, terms not otherwise defined herein shall have the meanings indicated below:

 

Section 2.01         Administrator. “Administrator” means the Board or, if the Board delegates responsibility for any matter to the Committee, the term Administrator shall mean the Committee.

 

Section 2.02         Affiliated Company. “Affiliated Company” means:

 

a)                with respect to Incentive Options, any “parent corporation” or “subsidiary corporation” of the Company, whether now existing or hereafter created or acquired, as those terms are defined in Sections 424(e) and 424(f) of the Code, respectively; and

 

b)               with respect to Nonqualified Options, Restricted Stock Units, Stock Appreciation Rights, and Restricted Stock Grants any entity described in paragraph (a) of this Section 2.02 above, plus any other corporation, limited liability company (“LLC”), partnership or joint venture, whether now existing or hereafter created or acquired, with respect to which the Company beneficially owns more than fifty percent (50%) of: (1) the total combined voting power of all outstanding voting securities, or (2) the capital or profits interests of an LLC, partnership or joint venture.

 

Section 2.03         Base Price. “Base Price” means the price per share of Common Stock for purposes of computing the amount payable to a Participant who holds a Stock Appreciation Right upon exercise thereof.

 

Section 2.04         Board. “Board” means the Board of Directors of the Company.

 

Section 2.05         Change in Control. Except as set forth below, “Change in Control” means:

 

a)                The acquisition, directly or indirectly, in one (1) transaction or a series of related transactions, by any person or group (within the meaning of Section 13(d)(3) of the Exchange Act) of the beneficial ownership of securities of the Company possessing more than fifty percent (50%) of the total combined voting power of all outstanding securities of the Company;

 

b)               A merger or consolidation in which the Company is not the surviving entity, except for a transaction in which the holders of the outstanding voting securities of the Company immediately prior to such merger or consolidation hold as a result of holding the Company securities prior to such transaction, in the aggregate, securities possessing more than fifty percent (50%) of the total combined voting power of all outstanding voting securities of the surviving entity (or the parent of the surviving entity) immediately after such merger or consolidation;

 

 

 

  1  

 

 

c)                A reverse merger in which the Company is the surviving entity but in which the holders of the outstanding voting securities of the Company immediately prior to such merger hold, in the aggregate, securities possessing less than fifty percent (50%) of the total combined voting power of all outstanding voting securities of the Company or of the acquiring entity immediately after such merger; or

 

d)               The sale, transfer or other disposition (in one (1) transaction or a series of related transactions) of all or substantially all of the assets of the Company, except for a transaction in which the holders of the outstanding voting securities of the Company immediately prior to such transaction(s) receive as a distribution with respect to securities of the Company, in the aggregate, securities possessing more than fifty percent (50%) of the total combined voting power of all outstanding voting securities of the acquiring entity immediately after such transaction(s).

 

e)                In addition, a Change in Control will be deemed to have occurred if, at any time during any period of twelve (12) consecutive months during the term of any Option, as stated in the Option Exercise Documents, Restricted Stock Award Agreement, Restricted Stock Unit Agreement or Stock Appreciation Right Agreement under this Plan, individuals who at the beginning of such period constituted the entire Board do not for any reason constitute a majority of the Board, unless the election, or the nomination for election by the Company’s stockholders, of each new director was approved by a vote of at least a majority of the directors then still in office who were directors at the beginning of the period (but not including any new director whose election or nomination is in connection with an actual or threatened proxy contest relating to the election of directors of the Company).

 

Notwithstanding the foregoing, a transaction will not be deemed a Change in Control unless the transaction qualifies as a change in control event within the meaning of Section 409A of the Code.

 

Section 2.06         Code. “Code” means the Internal Revenue Code of 1986, as amended from time to time.

 

Section 2.07         Committee. “Committee” means a committee of two (2) or more members of the Board appointed to administer the Plan, as set forth in Section 9.01.

 

Section 2.08         Common Stock. “Common Stock” means the Common Stock of the Company, subject to adjustment pursuant to Section 4.02.

 

Section 2.09         Company. “Company” means Tribal Rides International Corp., a Nevada corporation, or any entity that is a successor to the Company. Except where the context otherwise requires, the term “Company” shall include any of the Company’s present or future parent or subsidiary corporations.

 

Section 2.10         Disability. “Disability” means permanent and total disability as defined in Section 22(e)(3) of the Code. The Administrator’s determination of a Disability or the absence thereof shall be conclusive and binding on all interested parties.

 

Section 2.11         Effective Date. “Effective Date” means the date on which the Plan was originally adopted by the Board, as set forth on the first page hereof.

 

Section 2.12         Exchange Act. “Exchange Act” means the Securities and Exchange Act of 1934, as amended.

 

Section 2.13         Exercise Price. “Exercise Price” means the purchase price per share of Common Stock payable by the Optionee to the Company upon exercise of an Option.

 

Section 2.14         Fair Market Value. “Fair Market Value” on any given date means the value of one (1) share of Common Stock, determined as follows: (i) the last sale before or the first sale after the grant date; (ii) the closing price on the trading day before or on the grant date; (iii) the arithmetic mean (average) of the high and low prices on the trading day before or the trading day of the grant; (iv) an average of the stock price (determined either based on the arithmetic mean or the average of such selling price, weighted based on the volume of trading on each trading day during the period) over a fixed period occurring within 30 days before or after the grant; or (v) any other reasonable valuation method using actual transactions. If there is no public trading market for the Common Stock, the Administrator may determine the fair market value in good faith using any reasonable method of evaluation in a manner consistent with the valuation principles under Section 409A of the Code, which determination shall be conclusive and binding on all interested parties.

 

 

 

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Section 2.15         FINRA Dealer. “FINRA Dealer” means a broker-dealer that is a member of the Financial Industry Regulatory Authority.

 

Section 2.16         Grant Form. “Grant Form” means the Grant of Stock Option form signed by both parties with respect to either an Incentive Option or a Nonqualified Option, the form of which is set forth in Attachment 1 to this Plan.

 

Section 2.17         Incentive Option. “Incentive Option” means any Option designated and qualified as an “incentive stock option” as defined in Section 422 of the Code.

 

Section 2.18         Nonqualified Option. “Nonqualified Option” means any Option that is not an Incentive Option.  To the extent that any Option designated as an Incentive Option fails in whole or in part to qualify as an Incentive Option, including, without limitation, for failure to meet the limitations applicable to a 10% Stockholder or because it exceeds the annual limit provided for in Section 5.07 below, it shall to that extent constitute a Nonqualified Option.

 

Section 2.19         Option. “Option” means any option to purchase Common Stock granted pursuant to this Plan.

 

Section 2.20         Option Exercise Documents. “Option Exercise Documents” means and includes the Option Exercise Form, the Grant Form, the forms of which are set forth in Attachments 1 and 2 to this Plan, and any other agreements the Optionee is required to enter into to exercise options.

 

Section 2.21         Option Exercise Form. “Option Exercise Form” means the form identified as Exhibit A to the Grant Form.

 

Section 2.22         Optionee. “Optionee” means any Participant who holds an Option.

 

Section 2.23         Participant. “Participant” means an individual or entity that holds Options, Restricted Stock Units, Stock Appreciation Rights, or Restricted Stock Awards under this Plan.

 

Section 2.24         Performance Criteria. “Performance Criteria” means one (1) or more of the following as established by the Administrator, which may be stated as a target percentage or dollar amount, a percentage increase over a base period percentage or dollar amount or the occurrence of a specific event or events:

 

a)                Revenue;

b)               Gross profit;

c)                Operating income;

d)               Pre-tax income;  

e)                Earnings before interest, taxes, depreciation and amortization (“EBITDA”);

f)                Earnings per common share on a fully diluted basis (“EPS”);

g)               Consolidated net income of the Company divided by the average consolidated common stockholders’ equity (“ROE”);

h)               Cash and cash equivalents derived from either (i) net cash flow from operations, or (ii) net cash flow from operations, financings and investing activities (“Cash Flow”);

i)                 Adjusted operating cash flow return on income;

j)                 Cost containment or reduction;

k)               The percentage increase in the market price of the Company’s common stock over a stated period; and

l)                 Individual business objectives.

 

Section 2.25         Restricted Stock Award. “Restricted Stock Award” means shares issued pursuant to the Restricted Stock Award Program in Article 8.

 

Section 2.26         Restricted Stock Award Agreement. “Restricted Stock Award Agreement” means the written agreement entered into between the Company and a Participant evidencing the grant of Restricted Stock Awards under the Plan, the form of which is set forth in Attachment 3 to this Plan.

 

 

 

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Section 2.27         Restricted Stock Award Program. “Restricted Stock Award Program” means the program to issue restricted shares pursuant to Article 8.

 

Section 2.28         Restricted Stock Unit. “Restricted Stock Unit” means a right to receive an amount equal to the Fair Market Value of one (1) share of Common Stock, issued pursuant to Article 6, subject to any restrictions and conditions as are established pursuant to Article 6.

 

Section 2.29         Restricted Stock Unit Agreement. “Restricted Stock Unit Agreement” means the written agreement entered into between the Company and a Participant evidencing the grant of Restricted Stock Units under the Plan, the form of which is set forth in Attachment 4 to this Plan.

 

Section 2.30         Service. “Service” means the provision of services to the Company or any Affiliated Company by a person in the capacity of an employee, a non-employee member of the board of directors, officer, or a Service Provider, except to the extent otherwise specifically provided in the documents evidencing the grant of an award under this Plan.

 

Section 2.31         Service Provider. “Service Provider” means a consultant or other person or entity the Administrator authorizes to become a Participant in the Plan and who provides services to (i) the Company, (ii) an Affiliated Company, or (iii) any other business venture designated by the Administrator in which the Company or an Affiliated Company has a significant ownership interest.

 

Section 2.32         Stock Appreciation Right. “Stock Appreciation Right” means a right issued pursuant to Article 7, subject to any restrictions and conditions as are established pursuant to Article 7 that is designated as a Stock Appreciation Right.

 

Section 2.33         Stock Appreciation Right Agreement. “Stock Appreciation Right Agreement” means the written agreement entered into between the Company and a Participant evidencing the grant of Stock Appreciation Rights under the Plan, the form of which is set forth in Attachment 5 to this Plan.

 

Section 2.34         10% Stockholder. “10% Stockholder” means a person who, as of a relevant date, owns or is deemed to own (by reason of the attribution rules applicable under Section 424(d) of the Code) stock possessing more than 10% of the total combined voting power of all classes of stock of the Company or of an Affiliated Company.

 

Article 3. 

ELIGIBILITY

 

Section 3.01         Incentive Options. Only employees of the Company or of an Affiliated Company (including members of the Board if they are employees of the Company or of an Affiliated Company) are eligible to receive Incentive Options under the Plan.

 

Section 3.02         Nonqualified Options; Restricted Stock Units and Stock Appreciation Rights. Employees and officers of the Company or of an Affiliated Company, members of the Board (whether or not employed by the Company or an Affiliated Company), and Service Providers are eligible to receive Nonqualified Options, Restricted Stock Units, and Stock Appreciation Rights under the Plan.

 

Section 3.03         Section 162(m) Limitation. Subject to adjustment as to the number and kind of shares pursuant to Section 4.02, in no event shall any Participant be granted in any one (1) calendar year any award that does not qualify as “performance-based compensation” under Section 162(m) of the Code. In granting awards which are intended to qualify under Section 162(m) of the Code, the Administrator shall follow any procedures determined by it from time to time to be necessary or appropriate to ensure qualification of the award under Section 162(m) of the Code (e.g., in determining the Performance Criteria), provided that no action by the Company or the Administrator shall be deemed to be a promise that any such award will be “performance-based compensation” under such section.

 

 

 

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Article 4.

PLAN SHARES

 

Section 4.01         Shares Subject to the Plan. The number of shares of Common Stock that may be issued under this Plan shall be 2,500,000 shares of Common Stock, subject to adjustment as to the number and kind of shares pursuant to Section 4.02. For purposes of this limitation, in the event that (a) all or any portion of any Options or Stock Appreciation Rights granted under the Plan can no longer under any circumstances be exercised, (b) any shares of Common Stock are reacquired by the Company pursuant to the Option Exercise Documents, or (c) all or any portion of any Restricted Stock Units or Restricted Stock Awards granted under the Plan are forfeited or can no longer under any circumstances vest, the shares of Common Stock allocable to or covered by the unexercised or unvested portion of such Options, Stock Appreciation Rights, Restricted Stock Units, or Restricted Stock Awards, or the shares of Common Stock so reacquired shall again be available for grant or issuance under the Plan. The following shares of Common Stock may not again be made available for issuance as awards under the Plan: (i) shares of Common Stock not issued or delivered as a result of the net settlement of outstanding Stock Appreciation Rights or Options, (ii) shares of Common Stock used to pay the Exercise Price related to outstanding Options, (iii) shares of Common Stock used to pay withholding taxes related to outstanding Options, Stock Appreciation Rights, Restricted Stock Units, or Restricted Stock Awards, or (iv) shares of Common Stock repurchased on the open market with the proceeds of the Option Exercise Price.

 

Section 4.02         Changes in Capital Structure. In the event that the outstanding shares of Common Stock are hereafter increased or decreased or changed into or exchanged for a different number or kind of shares or other securities of the Company by reason of a recapitalization, stock split, reverse stock split, reclassification, stock dividend, or other change in the capital structure of the Company, then appropriate adjustments shall be made by the Administrator to the aggregate number and kind of shares subject to this Plan, the number and kind of shares and the price per share subject to or covered by outstanding Option Exercise Documents, Restricted Stock Award Agreement, Restricted Stock Unit Agreement or Stock Appreciation Right Agreement and the limit on the number of shares under Section 3.03, all in order to preserve, as nearly as practical, but not to increase, the benefits to Participants.

 

Section 4.03         Limitation on Number of Shares. The total number of shares of Common Stock issuable under this Plan shall not exceed 30% of the then outstanding shares of Common Stock (with convertible preferred or convertible senior common shares counted on an as if converted basis), unless a percentage higher than 30% is approved by at least two-thirds (2/3) of the outstanding securities entitled to vote.

 

Article 5.

OPTIONS

 

Section 5.01         Grant of Stock Options.  The Administrator shall have the right to grant pursuant to this Plan, Options subject to such terms, restrictions, and conditions as the Administrator may determine at the time of grant.  Such conditions may include, but are not limited to, continued provision of Service or the achievement of specified performance goals or objectives established by the Administrator with respect to one (1) or more Performance Criteria, which require the Administrator to certify in writing whether and the extent to which such Performance Criteria were achieved.

 

Section 5.02         Option Exercise Documents. Each Option granted pursuant to this Plan shall be evidenced by Option Exercise Documents which shall specify the number of shares subject thereto, vesting provisions relating to such Option, the Exercise Price per share, and whether the Option is an Incentive Option or Nonqualified Option. As soon as is practical following the grant of an Option, Option Exercise Documents shall be duly executed and delivered by or on behalf of the Company to the Optionee to whom such Option was granted.  Each Option Exercise Document shall be in such form and contain such additional terms and conditions, not inconsistent with the provisions of this Plan, as the Administrator shall, from time to time, deem desirable.

 

Section 5.03         Exercise Price. The Exercise Price per share of Common Stock covered by each Option shall be determined by the Administrator, subject to the following:  (a) the Exercise Price of an Incentive Option shall not be less than 100% of Fair Market Value on the date the Incentive Option is granted, (b) the Exercise Price of a Nonqualified Option shall not be less than 100% of Fair Market Value on the date the Nonqualified Option is granted, and (c) if the person to whom an Incentive Option is granted is a 10% Stockholder on the date of grant, the Exercise Price shall not be less than 110% of Fair Market Value on the date the Incentive Option is granted. However, an Option may be granted with an Exercise Price lower than that set forth in the preceding sentence if such Option is granted pursuant to an assumption or substitution for another option in a manner satisfying the provisions of Sections 409A and 424 of the Code.

 

 

 

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Section 5.04         Payment of Exercise Price. Payment of the Exercise Price shall be made upon exercise of an Option and may be made, in the discretion of the Administrator, subject to any legal restrictions, by: (a) cash; (b) check; (c) the surrender of shares of Common Stock owned by the Optionee (provided that shares acquired pursuant to the exercise of options granted by the Company must have been held by the Optionee for the requisite period necessary to avoid a charge to the Company’s earnings for financial reporting purposes), which surrendered shares shall be valued at Fair Market Value as of the date of such exercise; (d) the cancellation of indebtedness of the Company to the Optionee; (e) the waiver of compensation due or accrued to the Optionee for services rendered; (f) provided that a public market for the Common Stock exists, a “same day sale” commitment from the Optionee and a FINRA Dealer whereby the Optionee irrevocably elects to exercise the Option and to sell a portion of the shares so purchased to pay for the Exercise Price and whereby the FINRA Dealer irrevocably commits upon receipt of such shares to forward the Exercise Price directly to the Company; (g) provided that a public market for the Common Stock exists, a “margin” commitment from the Optionee and a FINRA Dealer whereby the Optionee irrevocably elects to exercise the Option and to pledge the shares so purchased to the FINRA Dealer in a margin account as security for a loan from the FINRA Dealer in the amount of the Exercise Price, and whereby the FINRA Dealer irrevocably commits upon receipt of such shares to forward the Exercise Price directly to the Company; or (h) any combination of the foregoing methods of payment or any other consideration or method of payment as shall be permitted by applicable law and approved by the Administrator.

 

Section 5.05         Term and Termination of Options. The term and provisions for termination of each Option shall be as fixed by the Administrator, but no Option may be exercisable more than ten (10) years after the date it is granted.  An Incentive Option granted to a person who is a 10% Stockholder on the date of grant shall not be exercisable more than five (5) years after the date it is granted.

 

Section 5.06         Vesting and Exercise of Options. Each Option shall vest and become exercisable in one (1) or more installments at such time or times and subject to such conditions, including without limitation the achievement of specified performance goals or objectives established with respect to one (1) or more Performance Criteria, as shall be determined by the Administrator.

 

Section 5.07         Annual Limit on Incentive Options. To the extent required for “incentive stock option” treatment under Section 422 of the Code, the aggregate Fair Market Value (determined as of the time of grant) of the Common Stock with respect to which Incentive Options granted under this Plan and any other plan of the Company or any Affiliated Company become exercisable for the first time by an Optionee during any calendar year shall not exceed $100,000.

 

Section 5.08         Restrictions. Options may not be sold, pledged or otherwise encumbered or disposed of and shall not be assignable or transferable except by will, the laws of descent and distribution or pursuant to a domestic relations order entered by a court in settlement of marital property rights, except as specifically provided in the Stock Option Agreement or as authorized by the Administrator, and subject to Section 13.01 of this Plan.

 

Section 5.09         Effect of Termination of Service, Death, or Disability.

 

a)                Unless otherwise provided by the Administrator, any unvested Options held by the Optionee at the time of termination of Service, Disability or death, will expire immediately upon the occurrence of any such event.

 

b)               The following provisions shall govern the exercise of any vested Options held by the Optionee at the time of termination of Service, Disability, or death:

 

(1)             Should the Optionee’s Service be terminated for cause, then the Options shall terminate on the date Service is terminated.

 

(2)             Should the Optionee’s Service be terminated for Disability, then the Optionee shall have a period of six (6) months following the date of such termination during which to exercise each outstanding Option held by such Optionee at the time of Disability.

 

(3)             If the Optionee dies while holding an outstanding Option, then the personal representative of his or her estate or the person or persons to whom the Option is transferred pursuant to the Optionee’s will or the laws of inheritance shall have six (6) months following the date of the Optionee’s death to exercise such Option.

 

(4)             Should Optionee’s Service be terminated by reason other than for cause, Disability, or death, then the Optionee shall have a period of thirty (30) days following the date of such termination during which to exercise each outstanding Option held by such Optionee.

 

 

 

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(5)             Under no circumstances, however, shall any such Option be exercisable after the specified expiration of the Option term.

 

(6)             During the applicable post-Service exercise period, the Option may not be exercised in the aggregate for more than the number of vested shares for which the Option is exercisable on the date of the Optionee’s termination of Service. Upon the expiration of the applicable exercise period or (if earlier) upon the expiration of the Option term, the Option shall terminate and cease to be outstanding for any Option which has not been exercised.

 

c)                The Administrator shall have the discretion, exercisable either at the time an Option is granted or at any time while the Option remains outstanding, to provide either or both of the following, in whole or in part as to any Options:

 

(1)             extend the period of time for which the Option is to remain exercisable following Optionee’s termination of Service or death from the limited period otherwise in effect for that Option to such greater period of time as the Administrator shall deem appropriate, but in no event beyond the expiration of the Option term;

 

(2)             permit the Option to be exercised, during the applicable post-termination exercise period, not only with respect to the number of vested shares of Common Stock for which such Option is exercisable at the time of the Optionee’s termination of Service but also with respect to one (1) or more additional installments in which the Optionee would have vested under the Option had the Optionee continued Service.

 

Section 5.10         Rights as a Stockholder. An Optionee or permitted transferee of an Option shall have no rights or privileges as a stockholder with respect to any shares covered by an Option until such Option has been duly exercised and certificates representing shares purchased upon such exercise have been issued to such person.

 

Article 6.

RESTRICTED STOCK UNITS

 

Section 6.01         Grants of Restricted Stock Units. The Administrator shall have the right to grant pursuant to this Plan Restricted Stock Units subject to such terms, restrictions, and conditions as the Administrator may determine at the time of grant.  Such conditions may include, but are not limited to, continued employment or the achievement of specified performance goals or objectives established by the Administrator with respect to one (1) or more Performance Criteria, which require the Administrator to certify in writing whether and the extent to which such Performance Criteria were achieved.

 

Section 6.02           Restricted Stock Unit Agreements. A Participant shall have no rights with respect to the Restricted Stock Units covered by a Restricted Stock Unit Agreement until the Participant has executed and delivered to the Company the applicable Restricted Stock Unit Agreement. Each Restricted Stock Unit Agreement shall be in such form, and shall set forth such other terms, conditions, and restrictions of the Restricted Stock Unit Agreement, not inconsistent with the provisions of this Plan, as the Administrator shall, from time to time, deem desirable. Each such Restricted Stock Unit Agreement may be different from each other Restricted Stock Unit Agreement.

 

Section 6.03         Vesting of Restricted Stock Units. The Restricted Stock Unit Agreement shall specify the date or dates, the performance goals, if any, established by the Administrator with respect to one (1) or more Performance Criteria that must be achieved, and any other conditions on which the Restricted Stock Units may vest. Except as otherwise provided by the Administrator, should the Participant cease to remain in Service while holding one (1) or more unvested Restricted Stock Units, should the performance objectives not be attained with respect to one (1) or more such unvested Restricted Stock Units, or in the event of the death or Disability of the Participant, then those Restricted Stock Units shall be immediately surrendered to the Company for cancellation, and the Participant shall have no further shareholder rights with respect to those Restricted Stock Units.

 

 

 

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Section 6.04         Form and Timing of Settlement. Settlement in respect of vested Restricted Stock Units will be automatic upon vesting thereof.  Payment in respect thereof will be made no later than thirty (30) days thereafter and may, in the discretion of the Administrator, be in cash, shares of Common Stock of equivalent Fair Market Value as of the date of exercise, or a combination of both, except as specifically provided in the Restricted Stock Unit Agreement.

 

Section 6.05         Rights as a Stockholder. Holders of Restricted Stock Units shall have no rights or privileges as a stockholder with respect to any shares of Common Stock covered thereby unless and until they become owners of shares of Common Stock following settlement in respect of such Restricted Stock Units, in whole or in part, in shares of Common Stock pursuant to their respective Restricted Stock Unit Agreements and the terms and conditions of the Plan.

 

Section 6.06         Restrictions. Restricted Stock Units may not be sold, pledged or otherwise encumbered or disposed of and shall not be assignable or transferable except by will, the laws of descent and distribution or pursuant to a domestic relations order entered by a court in settlement of marital property rights, except as specifically provided in the Restricted Stock Unit Agreement or as authorized by the Administrator, and subject to Section 13.01 of this Plan.

 

Article 7.

STOCK APPRECIATION RIGHTS

 

Section 7.01         Grants of Stock Appreciation Rights. The Administrator shall have the right to grant pursuant to this Plan, Stock Appreciation Rights subject to such terms, restrictions and conditions as the Administrator may determine at the time of grant. Such conditions may include, but are not limited to, continued employment or the achievement of specified performance goals or objectives established by the Administrator with respect to one (1) or more Performance Criteria, which require the Administrator to certify in writing whether and the extent to which such Performance Criteria were achieved.

 

Section 7.02         Stock Appreciation Right Agreements. A Participant shall have no rights with respect to the Stock Appreciation Rights covered by a Stock Appreciation Right Agreement until the Participant has executed and delivered to the Company the applicable Stock Appreciation Right Agreement. Each Stock Appreciation Right Agreement shall be in such form, and shall set forth the Base Price and such other terms, conditions and restrictions of the Stock Appreciation Right Agreement, not inconsistent with the provisions of this Plan, as the Administrator shall, from time to time, deem desirable. Each such Stock Appreciation Right Agreement may be different from each other Stock Appreciation Right Agreement.

 

Section 7.03         Base Price. The Base Price per share of Common Stock covered by each Stock Appreciation Right shall be determined by the Administrator and will be not less than 100% of Fair Market Value on the date the Stock Appreciation Right is granted.  However, a Stock Appreciation Right may be granted with a Base Price lower than that set forth in the preceding sentence if such Stock Appreciation Right is granted pursuant to an assumption or substitution for another stock appreciation right in a manner satisfying the provisions of Section 409A of the Code.

 

Section 7.04         Term and Termination of Stock Appreciation Rights. The term and provisions for termination of each Stock Appreciation Right shall be as fixed by the Administrator, but no Stock Appreciation Right may be exercisable more than ten (10) years after the date it is granted.

 

Section 7.05         Vesting and Exercise of Stock Appreciation Rights. Each Stock Appreciation Right shall vest and become exercisable in one (1) or more installments at such time or times and subject to such conditions, including without limitation the achievement of specified performance goals or objectives established with respect to one (1) or more Performance Criteria, as shall be determined by the Administrator.

 

Section 7.06         Effect of Termination of Service, Death, or Disability.

 

a)                Unless otherwise provided by the Administrator, any unvested Stock Appreciation Right held by the Participant at the time of termination of Service, Disability or death, will expire immediately upon the occurrence of any such event.

 

b)               The following provisions shall govern the exercise of any vested Stock Appreciation Right held by the Participant at the time of termination of Service, Disability, or death:

 

 

 

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(1)             Should the Participant’s Service be terminated for cause, then the Stock Appreciation Rights shall terminate on the date Service is terminated.

 

(2)             Should the Participant’s Service be terminated for Disability, then the Participant shall have a period of six (6) months following the date of such termination during which to exercise each outstanding Stock Appreciation Right held by such Participant at the time of Disability.

 

(3)             If the Participant dies while holding an outstanding Stock Appreciation Right, then the personal representative of his or her estate or the person or persons to whom the Stock Appreciation Right is transferred pursuant to the Participant’s will or the laws of inheritance shall have six (6) months following the date of the Participant’s death to exercise such Stock Appreciation Right.

 

(4)             Should Participant’s Service be terminated by reason other than for cause, Disability, or death, then the Participant shall have a period of thirty (30) days following the date of such termination during which to exercise each outstanding Stock Appreciation Right held by such Participant.

 

(5)             Under no circumstances, however, shall any such Stock Appreciation Right be exercisable after the specified expiration of the Stock Appreciation Right term.

 

c)                The Administrator shall have the discretion, exercisable either at the time a Stock Appreciation Right is granted or at any time while the Stock Appreciation Right remains outstanding, to extend the period of time for which the Stock Appreciation Right is to remain exercisable following Participant’s termination of Service or death from the limited period otherwise in effect for that Stock Appreciation Right to such greater period of time as the Administrator shall deem appropriate, but in no event beyond the expiration of the Stock Appreciation Right term;

 

Section 7.07         Amount, Form and Timing of Settlement. Upon exercise of a Stock Appreciation Right, the Participant who holds such Stock Appreciation Right will be entitled to receive payment from the Company in an amount equal to the product of (a) the difference between the Fair Market Value of a share of Common Stock on the date of exercise over the Base Price per share of Common Stock covered by such Stock Appreciation Right and (b) the number of shares of Common Stock with respect to which such Stock Appreciation Right is being exercised. Payment in respect thereof will be made no later than thirty (30) days after such exercise, provided that such payment will be made in a manner such that no amount of compensation will be treated as deferred under Treasury Regulation Section 1.409A-1(b)(5)(i)(D).  Such payment may, in the discretion of the Administrator, be in cash, shares of Common Stock of equivalent Fair Market Value as of the date of exercise, or a combination of both, except as specifically provided in the Stock Appreciation Right Agreement.

 

Section 7.08         Rights as a Stockholder. Holders of Stock Appreciation Rights shall have no rights or privileges as a stockholder with respect to any shares of Common Stock covered thereby unless and until they become owners of shares of Common Stock following settlement in respect of such Stock Appreciation Rights, in whole or in part, in shares of Common Stock pursuant to their respective Stock Appreciation Right Agreements and the terms and conditions of the Plan.

 

Section 7.09         Restrictions. Stock Appreciation Rights may not be sold, pledged or otherwise encumbered or disposed of and shall not be assignable or transferable except by will, the laws of descent and distribution or pursuant to a domestic relations order entered by a court in settlement of marital property rights, except as specifically provided in the Stock Appreciation Right Agreement or as authorized by the Administrator, and subject to Section 13.01 of this Plan.

 

 

 

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Article 8.

RESTRICTED STOCK AWARDS PROGRAM

 

Section 8.01         Restricted Stock Award Terms. Shares of Common Stock may be issued under the Restricted Stock Awards Program through direct and immediate issuances of Restricted Stock Awards without any intervening option grants. Each such stock grant shall be evidenced by a Restricted Stock Awards Agreement which complies with the terms specified below.

 

Section 8.02         Cost of Shares. Grants of Restricted Stock Awards under the Restricted Stock Awards Program shall be made at such cost as the Administrator shall determine and may be issued for no monetary consideration, subject to applicable state law.

 

Section 8.03         Vesting Provisions.

 

a)                Each Restricted Stock Award shall vest and become exercisable in one (1) or more installments at such time or times and subject to such conditions, including without limitation the achievement of specified performance goals or objectives established with respect to one (1) or more Performance Criteria, as shall be determined by the Administrator.

 

a)                Any new, substituted or additional securities or other property (including money paid other than as a regular cash dividend) which the Participant may have the right to receive with respect to the Participant’s unvested Restricted Stock Awards by reason of any stock dividend, stock split, recapitalization, combination of shares, exchange of shares or other change affecting the outstanding Common Stock as a class without the Company’s receipt of consideration shall be issued subject to (i) the same vesting requirements applicable to the Participant’s unvested Restricted Stock Awards and (ii) such escrow arrangements as the Administrator shall deem appropriate.

 

b)               Unless specified otherwise in the Restricted Stock Awards Agreement, the Participant shall have full shareholder rights with respect to any Restricted Stock Awards issued to the Participant under the Restricted Stock Awards Program, whether or not the Participant’s interest in those shares is vested, and accordingly, the Participant shall have the right to vote such shares and to receive any regular cash dividends paid on such shares.

 

c)                Should the Participant cease to remain in Service while holding one (1) or more unvested Restricted Stock Awards issued under the Restricted Stock Awards Program or should the performance objectives not be attained with respect to one (1) or more such unvested Restricted Stock Awards, then those shares shall be immediately surrendered to the Company for cancellation, and the Participant shall have no further shareholder rights with respect to those shares. To the extent the surrendered shares were previously issued to the Participant for consideration paid in cash or cash equivalent (including the Participant’s purchase-money indebtedness), the Company shall repay to the Participant the cash consideration paid for the surrendered shares and shall cancel the unpaid principal balance of any outstanding purchase-money note of the Participant attributable to such surrendered shares.

 

d)               The Administrator may in its discretion waive the surrender and cancellation of one (1) or more unvested Restricted Stock Awards (or other assets attributable thereto) which would otherwise occur upon the non-completion of the vesting schedule applicable to such shares. Such waiver shall result in the immediate vesting of the Participant’s interest in the Restricted Stock Awards as to which the waiver applies. Such waiver may be effected at any time, whether before or after the Participant’s cessation of Service or the attainment or non-attainment of the applicable performance objectives.

 

Section 8.04         Restrictions. Unvested Restricted Stock Awards may not be sold, pledged or otherwise encumbered or disposed of and shall not be assignable or transferable except by will, the laws of descent and distribution or pursuant to a domestic relations order entered by a court in settlement of marital property rights, except as specifically provided in the Restricted Stock Award Agreement or as authorized by the Administrator, and subject to Section 13.01 of this Plan.

 

Section 8.05         Share Escrow/Legends. Stock certificates evidencing any unvested Restricted Stock Awards may, in the Administrator’s discretion, be held in escrow by the Company until the Participant’s interest in such shares vests or may be issued directly to the Participant with restrictive legends on the certificates evidencing those unvested shares.

 

 

 

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Article 9. 

ADMINISTRATION OF THE PLAN

 

Section 9.01         Administrator. Authority to control and manage the operation and administration of the Plan shall be vested in the Board, which may delegate such responsibilities in whole or in part to a committee consisting of two (2) or more members of the Board (the “Committee”), each of whom shall meet the independence requirements under the then applicable rules, regulations or listing requirements of the principal exchange on which the Company’s shares of Common Stock are then listed or admitted to trading or as otherwise determined by the Board.  Members of the Committee may be appointed from time to time by, and shall serve at the pleasure of, the Board. The Board may limit the composition of the Committee to those persons necessary to comply with the requirements of Section 162(m) of the Code and Section 16 of the Exchange Act. As used herein, the term “Administrator” means the Board or, with respect to any matter as to which responsibility has been delegated to the Committee, the term Administrator shall mean the Committee.

 

Section 9.02         Powers of the Administrator. In addition to any other powers or authority conferred upon the Administrator elsewhere in this Plan or by law, the Administrator shall have full power and authority:  (a) to determine the persons to whom, and the time or times at which, Incentive Options, Nonqualified Options, Restricted Stock Units, Stock Appreciation Rights, or Restricted Stock Awards shall be granted, the number of shares to be represented by Option Exercise Documents, and the Exercise Price of such Options and the Base Price of such Stock Appreciation Rights; (b) to interpret the Plan; (c) to create, amend or rescind rules and regulations relating to the Plan; (d) to determine the terms, conditions and restrictions contained in, and the form of, Option Exercise Documents, Restricted Stock Awards Agreement, Restricted Stock Unit Agreement, or Stock Appreciation Right Agreement; (e) to determine the identity or capacity of any persons who may be entitled to exercise a Participant’s rights under any Option Exercise Documents, Restricted Stock Awards Agreement, Restricted Stock Unit Agreement, or Stock Appreciation Right Agreement under the Plan; (f) to correct any defect or supply any omission or reconcile any inconsistency in the Plan or in any Option Exercise Documents, Restricted Stock Awards Agreement, Restricted Stock Unit Agreement, or Stock Appreciation Right Agreement; (g) to accelerate the vesting of any Option, Restricted Stock Unit, Stock Appreciation Right, or Restricted Stock Award; (h) to extend the expiration date of any Option Exercise Documents, Restricted Stock Awards Agreement, Restricted Stock Unit Agreement, or Stock Appreciation Right Agreement; (i) subject to Section 9.03, to amend outstanding Option Exercise Documents, Restricted Stock Awards Agreement, Restricted Stock Unit Agreement, or Stock Appreciation Right Agreement to provide for, among other things, any change or modification which the Administrator could have included in the original agreement or in furtherance of the powers provided for herein; and (j) to make all other determinations necessary or advisable for the administration of this Plan, but only to the extent not contrary to the express provisions of this Plan.  Any action, decision, interpretation or determination made in good faith by the Administrator in the exercise of its authority conferred upon it under this Plan shall be final and binding on the Company and all Participants.  Notwithstanding any term or provision in this Plan, the Administrator shall not have the power or authority, by amendment or otherwise to extend the expiration date of an Option, Restricted Stock Unit or Stock Appreciation Right beyond the tenth (10th) anniversary of the date such Option or Stock Appreciation Right was granted.

 

Section 9.03         Repricing Prohibited. Subject to Section 4.02, and except in connection with a corporate transaction involving the Company (including, without limitation, any stock dividend, stock split, extraordinary cash dividend, recapitalization, reorganization, merger, consolidation, split-up, spin-off, combination, or exchange of shares), neither the Committee nor the Board shall amend the terms of outstanding awards to reduce the Exercise Price of outstanding Options or the Base Price of outstanding Stock Appreciation Rights or cancel outstanding Options, Stock Appreciation Rights, or Restricted Stock Awards in exchange for cash, other awards or Options with an Exercise Price that is less than the Exercise Price of the original Options or Stock Appreciation Rights with a Base Price that is less than the Base Price of the original Stock Appreciation Rights, without approval of the Company’s stockholders, evidenced by a majority of votes cast.

 

Section 9.04         Limitation on Liability; Indemnification.  No employee of the Company or member of the Board or Committee shall be subject to any liability with respect to duties under the Plan unless the person acts fraudulently or in bad faith.  To the extent permitted by law, the Company shall indemnify each member of the Board or Committee, and any employee of the Company with duties under the Plan, who was or is a party, or is threatened to be made a party, to any threatened, pending or completed proceeding, whether civil, criminal, administrative or investigative, by reason of such person’s conduct in the performance of duties under the Plan.

 

 

 

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Article 10.

CHANGE IN CONTROL

 

Section 10.01      Options and Stock Appreciation Rights. Vesting of all outstanding Options or Stock Appreciation Rights shall accelerate automatically effective as of immediately prior to the consummation of the Change in Control. In connection with such acceleration, the Administrator in its discretion may provide, in connection with the Change in Control transaction, for the purchase or exchange of each Option or Stock Appreciation Right for an amount of cash or other property having a value equal to (i) with respect to each Option, the amount (or “spread”) by which, (x) the value of the cash or other property that the Optionee would have received pursuant to the Change in Control transaction in exchange for the shares issuable upon exercise of the Option had the Option been exercised immediately prior to the Change in Control, exceeds (y) the Exercise Price of the Option, and (ii) with respect to each Stock Appreciation Right, the value of the cash or other property that the Participant would have received had the Stock Appreciation Right been exercised immediately prior to the Change in Control. The Administrator shall have the discretion to provide in each Option Exercise Document other terms and conditions that relate to vesting of such Option or Stock Appreciation Right in the event of a Change in Control. The aforementioned terms and conditions may vary in each Option Exercise Document and may be different from and have precedence over the provisions set forth in this Section 10.01.

 

Section 10.02      Restricted Stock Units and Restricted Stock Awards. All Restricted Stock Units and unvested Restricted Stock Awards shall vest in full effective as of immediately prior to the consummation of the Change in Control. In connection with such acceleration, the Administrator in its discretion may provide, in connection with the Change in Control transaction, for the purchase or exchange of each Restricted Stock Unit or Restricted Share for an amount of cash or other property having a value equal to the value of the cash or other property that the Participant would have received had the Restricted Stock Unit or Restricted Share vested immediately prior to the Change in Control. The Administrator shall have the discretion to provide in each agreement other terms and conditions that relate to vesting of such Restricted Stock Units and Restricted Stock Awards in the event of a Change in Control. The aforementioned terms and conditions may vary in each agreement, and may be different from and have precedence over the provisions set forth in this Section 10.02.

 

Article 11.

AMENDMENT AND TERMINATION OF THE PLAN

 

Section 11.01      Amendments. The Board may from time to time alter, amend, suspend or terminate this Plan in such respects as the Board may deem advisable. No such alteration, amendment, suspension or termination shall be made which shall substantially affect or impair the rights of any Participant under an outstanding Option Exercise Documents, Restricted Stock Awards Agreement, Restricted Stock Unit Agreement, and Stock Appreciation Right Agreement without such Participant’s consent. Shareholder approval is required for any amendment which increases the number of shares that may be issued under the Plan. The Board may alter or amend the Plan to comply with requirements under the Code relating to Incentive Options or other types of options which gives Optionees more favorable tax treatment than that applicable to Options granted under this Plan as of the date of its adoption. Upon any such alteration or amendment, any outstanding Option granted hereunder may, if the Administrator so determines and if permitted by applicable law, be subject to the more favorable tax treatment afforded to an Optionee pursuant to such terms and conditions. The Plan Administrator may revise or amend the grant forms attached to this Plan.

 

Section 11.02      Plan Termination. Unless this Plan shall theretofore have been terminated, the Plan shall terminate on the tenth (10th) anniversary of the Effective Date and no Options, Restricted Stock Units, Stock Appreciation Rights, or Restricted Stock Awards may be granted under the Plan thereafter, but Option Exercise Documents, Restricted Stock Awards Agreement, Restricted Stock Unit Agreements, and Stock Appreciation Right Agreements then outstanding shall continue in effect in accordance with their respective terms.

 

Article 12.

TAXES

 

Section 12.01      Withholding. The Company shall have the power to withhold, or require a Participant to remit to the Company, an amount sufficient to satisfy any applicable Federal, state, and local tax withholding requirements with respect to any Options, Restricted Stock Units, Stock Appreciation Rights, or Restricted Stock Awards. To the extent permissible under applicable tax, securities and other laws, the Administrator may, in its sole discretion and upon such terms and conditions as it may deem appropriate, permit a Participant to satisfy his or her obligation to pay any such tax, in whole or in part, up to an amount determined on the basis of the highest marginal tax rate applicable to such Participant, by (a) directing the Company to apply shares of Common Stock to which the Participant is entitled as a result of the exercise of an Option or Stock Appreciation Right or vesting of a Restricted Stock Unit or Restricted Share, or (b) delivering to the Company shares of Common Stock owned by the Participant. The shares of Common Stock so applied or delivered in satisfaction of the Participant’s tax withholding obligation shall be valued at their Fair Market Value as of the date of measurement of the amount of income subject to withholding.

 

 

 

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Section 12.02      Compliance with Section 409A of the Code. Options, Restricted Stock Units, Stock Appreciation Rights, and Restricted Stock Awards will be designed and operated in such a manner that they are either exempt from the application of, or comply with, the requirements of Section 409A of the Code such that the grant, payment, settlement or deferral will not be subject to the additional tax or interest applicable under Section 409A of the Code, except as otherwise determined in the sole discretion of the Administrator. The Plan and each Option Exercise Document, Restricted Stock Awards Agreement, Restricted Stock Unit Agreement, and Stock Appreciation Right Agreement is intended to meet the requirements of Section 409A of the Code and will be construed and interpreted in accordance with such intent, except as otherwise determined in the sole discretion of the Administrator. To the extent that an Option, Restricted Stock Unit, Stock Appreciation Right, or Restricted Stock Award, or grant, payment, settlement or deferral thereof is subject to Section 409A of the Code such Option, Restricted Stock Unit, Stock Appreciation Right, or Restricted Share will be granted, paid, settled or deferred in a manner that will meet the requirements of Section 409A of the Code, such that the grant, payment, settlement or deferral thereof will not be subject to the additional tax or interest applicable under Section 409A of the Code.

 

 

 

Article 13.

MISCELLANEOUS

 

Section 13.01      Involuntary Transfer. In the event of any transfer by operation of law or other involuntary transfer (including divorce or death) of all or a portion of any awards or shares granted pursuant to this Plan, whether vested or unvested, held by the record holder thereof, the Company shall have the right to purchase all of the awards or shares transferred at the greater of the purchase price paid by purchaser or the Fair Market Value of the awards or shares (as determined by the Board of Directors) on the date of transfer. Upon such a transfer, the person acquiring the awards or shares shall promptly notify the Secretary of the Company of such transfer. The right to purchase such awards or shares shall be provided to the Company for a period of thirty (30) days following receipt by the Company of written notice by the person acquiring the awards or shares. Within thirty (30) days of receiving notice of the transfer or proposed transfer, the Company shall notify the purchaser/acquirer or his or her executor of the price. If the purchaser/acquirer does not agree with the Company’s valuation, the purchaser/acquirer may have the valuation determined by an independent appraiser to be mutually agreed upon and paid for by the purchaser/acquirer and the Company.

 

Section 13.02      Shareholder Approval of the Plan. The Plan shall be approved by a majority of the outstanding securities entitled to vote at a duly called meeting or by majority written consent by the later of (i) within twelve (12) months before or after the date the Plan is adopted, or (ii) prior to or within twelve (12) months of the granting of any Incentive Options or Nonqualified Options, or the issuance of any Restricted Stock Units, Stock Appreciation Rights, or Restricted Stock Awards. If any Incentive Options or Nonqualified Options is exercised, or any Restricted Stock Units, Stock Appreciation Rights, or Restricted Stock Awards is issued before security holder approval is obtained, the award shall be rescinded if security holder approval is not obtained in the manner described in the preceding sentence.

 

Section 13.03      Excess Awards. Awards may be granted under the Plan which are in each instance in excess of the number of shares of Common Stock then available for issuance under the Plan, provided any excess shares actually issued under those programs shall be held in escrow until there is obtained shareholder approval of an amendment or increase pursuant to Section 4.01 sufficiently increasing the number of shares of Common Stock available for issuance under the Plan. If such shareholder approval is not obtained within twelve (12) months after the date the first such excess issuances are made, then (i) any unexercised options granted on the basis of such excess shares shall terminate and cease to be outstanding and (ii) the Company shall promptly refund to the Participants the exercise or purchase price paid for any excess shares issued under the Plan and held in escrow, together with interest (at the applicable Short Term Federal Rate) for the period the shares were held in escrow, and such shares shall thereupon be automatically canceled and cease to be outstanding.

 

Section 13.04      Benefits Not Alienable. Other than as provided above, benefits under this Plan may not be assigned or alienated, whether voluntarily or involuntarily. Any unauthorized attempt at assignment, transfer, pledge or other disposition shall be without effect.

 

Section 13.05      No Enlargement of Employee Rights. This Plan is strictly a voluntary undertaking on the part of the Company and shall not be deemed to constitute a contract between the Company and any Participant to be consideration for, or an inducement to, or a condition of, the employment of any Participant. Nothing contained in the Plan shall be deemed to give the right to any Participant to be retained as an employee of the Company or any Affiliated Company or to interfere with the right of the Company or any Affiliated Company to discharge any Participant at any time.

 

 

 

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Section 13.06      Application of Funds. The proceeds received by the Company from the sale of Common Stock pursuant to Option Exercise Documents, except as otherwise provided herein, will be used for general corporate purposes.

 

Section 13.07      Annual Reports. During the term of this Plan, the Company will furnish to each Participant who does not otherwise receive such materials, copies of all reports, proxy statements and other communications that the Company distributes generally to its stockholders, including, but not limited to, annual financial statements.

 

Section 13.08      Choice of Law and Venue.  The Plan and all related documents shall be governed by, and construed in accordance with, the laws of the State of Nevada.  Acceptance of an award shall be deemed to constitute consent to the jurisdiction and venue of the courts located in the State of Nevada for all purposes in connection with any suit, action or other proceeding relating to such award, including the enforcement of any rights under the Plan or any agreement or other document, and shall be deemed to constitute consent to any process or notice of motion in connection with such proceeding being served by certified or registered mail or personal service within or without the State of Nevada, provided a reasonable time for appearance is allowed.

 

Section 13.09      Rule 16b-3. With respect to Participants subject to Rule 16b-3 of the Exchange Act, transactions under the Plan are intended to comply with all applicable provisions of Rule 16b-3. To the extent any provision of the Plan or action by the Plan Administrator fails to so comply, it shall be deemed null and void, to the extent permitted by law and deemed advisable by the Plan Administrator.

 

Section 13.10      Relationship to Other Plans. Nothing in this Plan shall prevent the Company or any Affiliated Company from adopting or continuing other or additional compensation arrangements, including without limitation plans providing for the granting of options, restricted stock units, stock appreciation rights, restricted stock awards, or other equity awards. Grants under the Plan may form a part of or otherwise be related to such other or additional compensation arrangements.

 

Attachments:

 

1. Grant of Stock Option Form

 

2. Option Exercise Form and the Grant Form

 

3. Restricted Stock Award Agreement Form

 

4. Restricted Stock Unit Agreement Form

 

5. Stock Appreciation Right Agreement Form

 

 

 

 

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Exhibit 10.1

 

 

 

 

 

 

 

 

 

 

 

XINDA INTERNATIONAL CORP.

 

- and -

 

TRIBAL RIDES INC.

 

ASSET PURCHASE AGREEMENT

 

January 18, 2020

 

 

 

 

 

 

 

 

 

 

 

 

 


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PURCHASE AGREEMENT This Purchase Agreement (this "Agreement") is entered into as of January 10, 2020, by and among XINDA INTERNATIONAL CORP. a corporation incorporated under the laws of the state of Nevada, ("XNDA") and TRIBAL RIDES , INC., a corporation incorporated under the laws of the state of Nevada, (“TribalRides”) and the shareholders of TribalRides (the “Shareholders”). Each of the parties to this Agreement is individually referred to herein as a “Party” and collectively, as the “Parties.”

 

WHEREAS, XNDA is a publicly traded corporation quoted on the OTC Markets (the “OTC”);

 

WHEREAS, XNDA has _fifty million (50,000,000) shares of common stock authorized, of which 5,857,500 are issued and outstanding, and no shares of Series A Preferred Stock authorized, none of which are issued and outstanding. TribalRides has five million (5,000,000) shares of common stock authorized, of which one million and seven hundred thousand (1,700,000) are issued and outstanding (the “TribalRides Stock”), which shares are owned by the Shareholders. The Shareholders are the record and beneficial owner of the number of shares of TribalRides Stock, or the right to receive such shares, set forth opposite such Shareholder’s name on Annex A hereto;

 

WHEREAS, XNDA wishes to purchase from TribalRides and TribalRides wish to sell to XNDA, certain assets of TribalRides, in exchange for an aggregate of 25,000,000_newly issued shares of the common stock, $0.001 par value, of XNDA (the “XNDA Stock”) on the terms and conditions contained herein (the "Asset Purchase");

 

WHEREAS, TribalRides is engaged in the business of Digital Transformation of Transportation (the “Business”);

 

WHEREAS, the Shareholders believe that the Asset Purchase is in the best interests of TribalRides and has agreed to enter into this Agreement as set out herein;

 

NOW, THEREFORE, in consideration of the covenants, premises, representations and warranties set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

 

ARTICLE 1 INTERPRETATION

 

1.1       Interpretation. In this Agreement:

 

(a)       Definitions. In this Agreement, the following terms have the meanings set forth below, which shall be equally applicable to both the singular and plural forms. Any agreement or document referred to below shall mean such agreement or document as amended, supplemented and modified from time to time to the extent permitted by the applicable provisions thereof and by this Agreement.

 

(i)  "affiliate" means, with respect to any Person, any other Person who directly or indirectly controls, is controlled by, or is under direct or indirect common control with, such Person. A Person shall be deemed to "control" another Person if such Person possesses, directly or indirectly, the power to direct or cause the direction of the management and policies of such other Person, whether through the ownership of voting securities, by contract or otherwise; and the term "controlled" shall have a similar meaning.

 

(ii)  "Applicable Laws" means, in respect of any Person, property, transaction, event or course of conduct, all applicable laws, statutes, regulations, rules, by-laws, ordinances, protocols, regulatory policies, codes, guidelines, official directives, orders, rulings, judgments and decrees of any Governmental Authority and includes the common law.

 

(iii)  "Assets" means all properties, assets and rights of every kind, nature and description whatsoever whether tangible or intangible, real, personal or mixed, fixed or contingent, choate or inchoate, known or unknown, wherever located.

 

 

 

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(iv)  "Assignment and Assumption Agreement" means the assignment and assumption agreement dated as of the Closing Date between TribalRides and XNDA, substantially in a form agreed to by XNDA and TribalRides.

 

(v)  "Bill of Sale" means the bill of sale provided from TribalRides for the Purchased Assets, substantially in a form agreed to by XNDA and TribalRides.

 

(vi)  "Business Day" means any day which is not a Saturday, Sunday or a day on which banks in Delaware are authorized by Applicable Laws or executive orders to be closed.

 

(vii )  "Claim" means a claim for indemnification by XNDA Indemnified Parties or the Seller Indemnified Parties pursuant to Section 8.1, 8.2 or 8.3, respectively.

 

(viii) "Closing" means the completion of the purchase and sale of the Purchased Assets pursuant to this Agreement at the Closing Time.

 

(ix)  "Closing Date" means the date of this Agreement.

 

(x)  "Code" means the Internal Revenue Code of 1986, as amended from time to time.

 

(xi)  "Consent" means any approval, consent, ratification, waiver, or other authorization of, notice to or registration, qualification, designation, declaration or filing with, any Person including, without limitation, any customer or Governmental Authority.

 

(xii)  "Contract" means any agreement, contract, option, license, instrument, obligation, commitment, arrangement, promise or undertaking, in each such case, whether written or oral and whether express or implied.

 

(xiii)  "Current Assets" of a Person at any date means all assets of the Person that would properly be classified in accordance with GAAP as current assets as of that date, after deducting adequate reserves in each case a reserve is proper, determined as of such date; provided, that if such Person is TribalRides, Current Assets shall only include current assets that are Purchased Assets.

 

(xiv)  "Direct Claim" means a Claim which originates pursuant to this Agreement and does not involve a Third Party Claim.

 

(xv)  "Employee Plan" means any "employee pension benefit plan" (as defined in Section 3(2) of ERISA), any "employee welfare benefit plan" (as defined in Section 3(1) of ERISA), and any other plan, program, policy, practice, Contract or other arrangement providing for compensation, severance, termination pay, deferred compensation, performance awards, stock or stock-related awards, fringe benefits or other employee benefits or remuneration of any kind, whether written, unwritten or otherwise, funded or unfunded, that is or has been maintained, contributed to, or required to be contributed to, by TribalRides for the benefit of any employee or with respect to which TribalRides has or may have any Liability.

 

(xvi)  "Encumbrance" means any security interest, pledge, lien, mortgage, charge, encumbrance, claim, condition, easement, covenant, warrant, equitable interest, option, purchase right, community property interest, right of first refusal, or other right of third parties or other restriction of any kind including, without limitation, any restriction on the exercise of any attribute of ownership (including any restriction on the use, voting, transfer or receipt of income related to any Asset).

 

(xvii)  "ERISA" means the Employee Retirement Income Security Act of 1974, as amended. A-3

 

 

 

 

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(xviii)  "ERISA Affiliate" means any entity that would be deemed a "single employer" with TribalRides under Section 414(b), (c), (m) or (o) of the Code or Section 4001 of ERISA.

 

(xix)  "Governmental Authority" means any federal, state, local, municipal, foreign or other governmental or quasi- governmental authority including, without limitation, any administrative, executive, judicial, legislative, regulatory or taxing authority of any nature of any jurisdiction (including, without limitation, any governmental agency, branch, department, official or entity and any court or other tribunal).

 

(xx)  "Governmental Charges" means all Taxes, levies, assessments, reassessments and other charges together with all related penalties, interest and fines, due and payable to any domestic or foreign government (federal, provincial, municipal or otherwise) or to any regulatory authority, agency, commission or board of any domestic or foreign government, or imposed by any court or any other law, regulation or rulemaking entity having jurisdiction in relevant circumstances.

 

(xxi)  "Guarantee" means any obligation of a Person directly or indirectly guaranteeing any Indebtedness or other obligation of any other Person and, without limiting the generality of the foregoing, any obligation, direct or indirect, contingent or otherwise, of such Person (i) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other obligation (whether arising by virtue of partnership arrangements, by agreement to keep-well, to purchase assets, goods, securities or services, to take-or-pay, or to maintain financial statement conditions or otherwise) or (ii) entered into for the purpose of assuring in any other manner the obligee of such Indebtedness or other obligation of the payment thereof or to protect such obligee against loss in respect thereof (in whole or in part).

 

(xxii)  "Hazardous Materials" means: (i) any material, substance, chemical, waste, product, derivative, compound, mixture, solid, liquid, mineral or gas, in each case, whether naturally occurring or manmade, that is hazardous, acutely hazardous, toxic, or words of similar import or regulatory effect under Environmental Laws; and (ii) any petroleum or petroleum-derived products, radon, radioactive materials or wastes, asbestos in any form, lead or lead- containing materials, urea formaldehyde foam insulation and polychlorinated biphenyls.

 

(xxiii)  "Indebtedness" means (i) the principal of and premium, if any, and interest in respect of any indebtedness for money borrowed or any obligations evidenced by notes or other instruments, (ii) capital lease obligations, (iii) obligations issued or assumed as the deferred purchase price of property or services and (iv) obligations in respect of surety bonds, letters of credit or other similar instruments.

 

(xxiv)  "Intellectual Property" means: (i) all inventions, arts, processes, compositions of matter, business methods, developments and improvements (whether or not patented or the subject of an application for patent, whether or not patentable and whether or not reduced to practice); and all improvements thereto; (ii) all patents, pending patent applications and rights to file patent applications for the inventions referred to in (i) above; all patent disclosures and invention disclosures; and all rights of priority, reissue, divisional, continuation or continuation-in-part applications, revisions, extensions and re-examinations in connection therewith; (iii) all trade-marks, trade dress, logos, trade names, business names, corporate names and domain names; all translations, adaptations, derivations and combinations thereof; all goodwill associated therewith; and all applications, registrations and renewals in connection therewith; (iv) all copyrightable works and all copyrights; and all applications, registrations and renewals in connection therewith; (v) all mask works and all integrated circuit topographies; and all applications, registrations and renewals in connection therewith; (vi) all industrial designs; and all applications, registrations and renewals in connection therewith; (vii) all other intellectual and industrial property (whether or not registered or the subject of an application for registration and whether or not registrable); (viii) all copies and tangible embodiments of any of the foregoing (in whatever form or medium); and (ix) all common law, statutory and contractual rights to the property and rights referred to in this definition.

 

(xxv)  "IRS" means the Internal Revenue Service.

 

(xxvi)  "Liability" means all liabilities of any kind whatsoever whether known or unknown, asserted or unasserted, absolute or contingent, accrued or unaccrued, liquidated or unliquidated, due or to become due, and whether or not reflected or required by GAAP to be reflected on a balance sheet including, without limitation, any direct or indirect Guarantee of any Liability of any other Person.

 

 

 

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(xxvii)  "Licensed Intellectual Property" means any Intellectual Property owned by a Person other than TribalRides and used by TribalRides pursuant to a license, sub-license, lease, sub-lease, royalty, conditional sale, strategic alliance or other similar arrangement in connection with the Purchased Assets.

 

(xxviii)  "Loss" means any loss, injury, liability, damage, cost, expense (including legal expenses) or deficiency of any kind or nature, whether direct, indirect or consequential, suffered or incurred by a party indemnified pursuant to the terms of this Agreement, in connection with any Claim made by it hereunder, including in respect of any proceeding, assessment, judgment, settlement or compromise relating thereto.

 

(xxix)  "Material Adverse Change" means any change, effect, event, occurrence, circumstance or state of facts that, individually or in the aggregate, is, or could reasonably be expected to be, material and adverse to the business, operations or financial condition, property, assets, or liabilities (contingent or otherwise) of the Purchased Assets or that would prevent or significantly impede the sale of the Purchased Assets, Purchased Equity or the Purchased Membership Interest or the completion of the other transactions contemplated by this Agreement and the Transaction Documents.

 

(xxx)  "Order" means any final and non-appealable award, decision, injunction, judgment, order, decree, ruling, subpoena or verdict entered, issued, made or rendered by any court, administrative agency or other Governmental Authority or by any referee, arbitrator or mediator.

 

(xxxi)  "Organizational Documents" means any certificate or articles of incorporation, formation or organization, by-laws, limited liability company operating agreement, certificate of limited partnership, business certificate of partners, partnership agreement, declaration of trust, constating documents or other similar documents.

 

(xxxii)  "Owned Intellectual Property" means any Intellectual Property owned by TribalRides and used in carrying on the Purchased Assets.

 

(xxxiii)  "Person" means any individual, corporation, general or limited partnership, limited liability company, joint venture, estate, trust, association, organization, labor union, Governmental Authority or other entity.

 

(xxxiv)  "Personal Information" means the type of information regulated by Applicable Laws and collected, used or disclosed by TribalRides in connection with the Purchased Assets, including information such as an individual's name, address, age, gender, identification number, income, family status, citizenship, employment, assets, liabilities, source of funds, payment records, credit information, personal references and health records, but does not include the name, title or business address or telephone number of an employee;

 

(xxxv)  "Proceeding" means any action, claim, arbitration, mediation, audit, hearing, investigation, litigation or suit (whether civil, criminal, quasi-criminal, administrative, regulatory, investigative or informal) commenced, brought, conducted or heard by or before, or otherwise involving, any court or other Governmental Authority or referee, trustee, arbitrator or mediator.

 

(xxxvi)  "Purchase Price" has the meaning ascribed thereto in Section 3.1.

 

(xxxvii)  "Purchased Assets" has the meaning ascribed thereto in Section 2.1.

 

(xxxviii)  "TribalRides Disclosure Schedule" means the disclosure schedules dated as of the date of this Agreement from TribalRides to XNDA in connection with this Agreement, and acknowledged by XNDA.

 

 

 

 

 

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(xl)  "TribalRides IP Assignment Agreements" means the Intellectual Property assignment agreement to be executed by the CEO of Tribal Rides in the favor of XNDA in a form agreed to by XNDA and TribalRides.

 

(xli)  "Tangible Personal Property" means all machinery, equipment, tools, furniture, fixtures, computer hardware, supplies, materials, servers, routers, desktop computers, laptop computers, fixed and mobile computer storage devices, mobile phones, personal digital assistants, network equipment, telephone systems, back-up systems, non- fixed media and all other computer and electronic equipment of any kind and other items of tangible personal property of every kind owned, leased or licensed by TribalRides (wherever located and whether or not carried on the books of TribalRides), together with all express and implied warranties by the manufacturers, sellers, lessors and licensors of such items or components thereof and all maintenance records and other documents relating thereto.

 

(xlii)  "Tax" or "Taxes" means any and all taxes, fees, levies, duties, tariffs and governmental impositions or charges of any kind in the nature of, or similar to, taxes, payable to any federal, state, provincial, local or foreign taxing authority including, without limitation (a) income, franchise, profits, gross receipts, ad valorem, net worth, value added, sales, use, service, real or personal property, special assessments, capital stock, license, payroll, withholding, employment, social security, workers' compensation, unemployment compensation, utility, severance, production, excise, stamp, occupation, premiums, windfall profits, transfer and gains taxes and (b) interest, penalties, additional taxes and additions to taxes imposed with respect thereto.

 

(xliii)  "Tax Returns" means any return, report or information statement with respect to Taxes (including, but not limited to, statements, schedules and appendices and other materials attached thereto) filed or required to be filed with the IRS or any other Governmental Authority including, without limitation, consolidated, combined and unitary tax returns.

 

(xliv)  "Third Party Claim" means a Claim by XNDA which originates by reason of a Person (other than XNDA) making a claim against the Purchased Assets.

 

(xlv)  "Transaction Documents" means this Agreement, the TribalRides Disclosure Schedule, the Bill of Sale, the Assignment and Assumption Agreement, the Consulting Agreement, the TribalRides IP Assignment Agreements and all other Contracts, instruments and certificates contemplated hereunder to be delivered by any party hereto at or prior to the Closing.

 

(b)        Headings. The inclusion of headings is for convenience of reference only and shall not affect the construction or interpretation hereof.

 

(c)        Gender and Number. Except where the context requires otherwise, words importing the singular include the plural and vice versa and words importing gender include all genders.

 

(d)        Including. Where the word "including" or "includes" is used, it means including or includes "without limitation".

 

(e)        Material. Where the term "material" or "materially" is used, it shall be construed, measured or assessed on the basis of whether the matter would materially affect a party and its subsidiaries, taken as a whole, or would prevent or significantly impede the purchase or sale of the Purchased Assets or the completion of the other transactions contemplated by this Agreement and the Transaction Documents.

 

(f)        No Strict Construction. The language used in this Agreement is the language chosen by the Parties to express their mutual intent, and no rule of strict construction shall be applied against any Party proposing any such language.

 

(g)        Statutory References. A reference to a statute includes all rules and regulations made pursuant to such statute and, unless expressly provided otherwise, the provisions of any statute, rule or regulation which amends, supplements or supersedes any such statute, rule or regulation.

 

(h)        Currency. Except where expressly provided otherwise herein, all amounts are stated and shall be paid in United States dollars.

 

 

 

 

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(i)        Time Periods. Except where expressly provided otherwise herein, time periods within or following which any payment is to be made or act is to be done shall be calculated by excluding the day on which the period commences and including the day on which the period ends and by extending the period to the following Business Day if the last day of the period is not a Business Day.

 

(j)        Accounting Principles. In this Agreement, except to the extent otherwise expressly provided, references to "GAAP", means, the generally accepted accounting principles in the United States so prescribed, recommended or promulgated from time to time by the Financial Accounting Standards Board, which are applicable as at the date on which any calculation made hereunder is to be effective. Unless otherwise defined herein, all financial terminology contained in this Agreement shall be interpreted in a manner which is consistent with GAAP. Notwithstanding anything to the contrary contained herein, in the event of an inconsistency or conflict between GAAP and any other accounting principles, practices or methodologies, GAAP shall prevail and govern to the extent necessary to remedy such inconsistency or conflict.

 

(k)        Knowledge. All references to the term "Knowledge" in this Agreement and the Transaction Documents means collectively, the actual knowledge of the Shareholders, and each of them, TribalRides and XNDA (as applicable) together with the knowledge which any of them would have had if they had made inquiries and investigations into the relevant matter that a reasonably prudent officer or investor of a corporate entity would have made in similar circumstances.

 

1.2        Entire Agreement. This Agreement and the Transaction Documents constitute the entire agreement between the Parties pertaining to the transactions contemplated by this Agreement and the Transaction Documents. There are no representations, warranties, covenants, agreements, conditions, indemnities or other provisions, whether oral or written, express or implied, collateral, statutory or otherwise, relating to the transactions contemplated by this Agreement and the Transaction Documents, except as expressly contained in this Agreement and the Transaction Documents and this Agreement and the Transaction Documents supersede any and all prior and/or contemporaneous agreements and understandings, both written and oral, among the Parties with respect to such subject matter.

 

1.3        Severability. Each of the provisions contained in this Agreement is distinct and severable and a declaration of invalidity or unenforceability of any such provision or part thereof by a court of competent jurisdiction shall not affect the validity or enforceability of any other provision hereof. The Parties shall engage in good faith negotiations to replace any provision which is declared invalid or unenforceable with a valid and enforceable provision, the economic effect of which comes as near as possible to that of the invalid or unenforceable provisions that it replaces.

 

1.4        Amendments; Waivers; Investigations. Except as expressly provided otherwise herein, no amendment or waiver of this Agreement shall be binding unless executed in writing by the Party to be bound thereby. No waiver of any provision of this Agreement shall constitute a waiver of any other provision nor shall any waiver of any provision of this Agreement constitute a continuing waiver unless expressly provided otherwise herein. No investigation or waiver made by or on behalf of any Party shall have the effect of waiving, diminishing the scope of or otherwise affecting any representation or warranty made by any other Party pursuant to this Agreement or any Transaction Document.

 

1.5        Governing Law. This Agreement will be governed by and any dispute arising out of or relating to this Agreement will be resolved in accordance with the laws of the State of California, without giving effect to conflict of laws principles.

 

 

 

 

 

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ARTICLE 2

ASSET PURCHASE

 

2.1       Asset Purchase from TribalRides.

 

(a)       Purchased Assets. Subject to the terms and conditions of this Agreement, at the Closing, TribalRides shall sell, convey, assign, transfer and deliver to XNDA, and XNDA shall acquire and purchase, free and clear of all Encumbrances, all right, title and interest in and to [all of the Assets of TribalRides listed on Exhibit A to this Agreement existing on the Closing Date]/[all of TribalRides’ rights, title and interest, as of the Closing Date, in and to any and all assets, properties, rights and claims of any kind or nature, whether tangible or intangible, real, personal or mixed, wherever located and whether or not carried or reflected on the books and records of any of TribalRides, whether now existing or hereinafter acquired, which relate to the Business or which are used or useful in or held for use in, or were acquired in connection with, the operation of the Business, excluding only the Excluded Assets (such assets, properties, rights and claims to be acquired hereunder, collectively, the “Purchased Assets”), free and clear of all Liens (except for Permitted Liens) and all claims against XNDA. The Purchased Assets shall include[, even if not listed on Exhibit A] but not be limited to, the following:

 

(i)  all Tangible Personal Property used by TribalRides in carrying on the Purchased Assets and together with all rights as of the Closing Date under all representations, warranties and guarantees made by suppliers, manufacturers and contractors to the extent related thereto;

 

(ii)  any and all inventory, packaging, marketing materials, adverting materials, signage product samples, or other property owned by TribalRides or TribalRides' clients but that is currently in TribalRides' possession;

 

(iii)  all rights of TribalRides to security deposits (whether real estate or personal property), claims for refunds (other than Tax refunds) and rights to offset in respect of such clients and/or customers of TribalRides, including all funds held for the benefit of or on behalf of any client or customer;

 

(iv)  any telephone, fax or vendor/payee number or email address owned by TribalRides and used in the Purchased Assets; and

 

(v)  the goodwill of the Purchased Assets together with the exclusive right to represent XNDA as carrying on the Purchased Assets as successor to TribalRides and the right to use the name "Tribal Rides" or any variation thereof.

 

(vi)  any interest in or ownership of any websites or domain names used or owned by TribalRides;

 

(vii)  all of the following Assets to the extent that such Assets arise from, are related to or are concerning the [Business/Assets of TribalRides listed on Exhibit A];

 

(A)               all licenses and distributor agreements;

 

(B)               all right, title and interest of TribalRides in all Contracts which relate exclusively to the Purchased Assets, as set out in Schedule 2.1 to the TribalRides Disclosure Schedule (to the extent that such Contracts are assignable or transferable and subject to obtaining any necessary consents to such assignment or transfer) (collectively, the "Assumed Contracts");

 

(C)               all right, title and interest of TribalRides to all of TribalRides’ Intellectual Property, and all Licensed Intellectual Property and Owned Intellectual Property;

 

(D)               all intangible property, including originals, and where such originals are not available, copies of all business and financial records (whether or not recorded on computer), including customer lists, prospect lists, business contacts, supplier lists, referral sources and all operating manuals, engineering standards and specifications and other information;

 

 

 

 

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(E)                all authorizations from Governmental Authorities or other permits of TribalRides, to the extent transferrable;

 

(F)                all insurance benefits, including rights and proceeds, to the extent transferable to XNDA;

 

(G)               all claims of TribalRides against third-parties, whether choate or inchoate, known or unknown, contingent or non-contingent; and

 

(H)               all rights, claims and credits, including all guarantees, warranties, indemnities and similar rights in favor of TribalRides;

 

(b)        Excluded Assets. Notwithstanding any other provision of this Agreement to the contrary, the following Assets of TribalRides existing on the Closing Date (collectively, the "Excluded Assets") are excluded from the Purchased Assets and shall remain the property of TribalRides after the Closing:

 

(i)  all Retained Liabilities, which shall consist of 100% of the liabilities of TribalRides;

 

(ii)  all minute books, seals, equity record books and equity transfer records of TribalRides and Tax Returns and Tax records of TribalRides and the books and records of TribalRides;

 

(iii)  all personnel records and other records that TribalRides is required by law to retain in its possession;

 

(iv)  all right, title or interest of TribalRides under any Contract, other than the Assumed Contracts;

 

(v)  all commissions, trade accounts payable and all trade debts payable by TribalRides;

 

(vi)  the right of TribalRides to claim for net refunds of income Taxes or gross receipts Taxes of TribalRides in excess of deficiencies for any period or with respect to any event, adjustment or occurrence prior to the Closing Date;

 

(vii)  prepaid Taxes, refunds of Taxes and Tax loss carry forwards including interest thereon or claims therefor for any period or portion thereof ending on or prior to the Closing Date;

 

(viii)  all insurance policies of the TribalRides to the extent not transferable;

 

(ix)  any refunds of insurance premiums with respect to any of TribalRides’ insurance policies; and

 

(x)  all rights of TribalRides under this Agreement, including with respect to the Purchase Price.

 

(c)        Agreement to Assume Liabilities. XNDA shall assume as of the Closing Date and shall pay, discharge and perform all obligations to be performed by TribalRides after, and not on, the Closing Date under the Assumed Contracts assumed under the terms of the Assignment and Assumption Agreement, which by the terms and conditions thereof are to be paid, discharged or performed at any time after, and not on, the Closing Date (the "Assumed Liabilities").

 

(d)        No Assumption of Retained Liabilities. XNDA shall not be liable for, or assume, any other liabilities or obligations of TribalRides other than the Assumed Liabilities. Notwithstanding anything to the contrary contained herein, and without limiting the foregoing, all of the following liabilities and obligations of TribalRides shall be considered "Retained Liabilities" for purposes of this Agreement:

 

(i)  All liabilities and debts on the TribalRides balance sheet and all amounts owed to any third party for any reason;

 

 

 

 

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(ii)  any Liability or obligation relating to product Liability claims for products sold or services rendered by TribalRides;

 

(iii)  all environmental Liabilities of TribalRides under Applicable Laws;

 

(iv)  any Liability or obligation which arises prior to or after the Closing Time in respect of the present or former employees, non-employee directors or other service providers of TribalRides or the spouses, dependents or beneficiaries thereof;

 

(v)  any Liability or obligation of TribalRides to any of TribalRides’ shareholders, members, directors, officers, managers or affiliates;

 

(vi)  all Liabilities of TribalRides and the ERISA Affiliates arising under, or with respect to, the Employee Plans;

 

(vii)  any Liability or obligation arising out of, or relating to, any Proceeding pending as of the Closing Date or any Proceeding commenced after the Closing Date to the extent arising out of, or relating to, any act or omission of TribalRides or any event, circumstance, condition occurring on or prior to the Closing Date;

 

(viii)  any Liability or obligation arising out of or resulting from noncompliance by TribalRides with any Applicable Law or any Order occurring on or prior to the Closing Date;

 

(ix)  any Liability or obligation of TribalRides with respect to Taxes;

 

(x)  any Liability or obligation arising out of, or relating to, the Excluded Assets on or prior to the Closing Date;

 

(xi)  any Liability or obligation under any Assumed Contract which arises after the Closing Date with respect to any breach or violation that occurred on or prior to the Closing Date;

 

(xii)  any Liability or obligation relating to or arising out of any Contracts of TribalRides other than the Assumed Contracts;

 

(xiii)  any Liability or obligation relating to, or resulting from, TribalRides Intellectual Property to the extent arising on or prior to the Closing Date;

 

(xiv)  any Liability or obligation based upon TribalRides’ acts or omissions occurring after the Closing Date (other than those relating to XNDA's ownership of the Purchased Assets); and

 

(xv)  Governmental Charges for the period on or prior to the Closing Date; and

 

(xvi)  any Liability or obligation of TribalRides under this Agreement or any of the Transaction Documents contemplated hereby.

 

(e)       No Assumption of Liabilities for TribalRides Employees. TribalRides will continue to be responsible for and will discharge all obligations and Liabilities in respect of all employees of TribalRides, and XNDA shall have no Liability whatsoever to any employees of TribalRides prior to or after the Closing Date.

 

(f)       Post-Closing Payments. All payments and reimbursements made by any third party in the name of or to TribalRides in connection with or arising out of the Purchased Assets (other than payments relating to Excluded Assets or Retained Liabilities), shall be held by TribalRides in trust for the benefit of XNDA and, promptly, and in any event within three (3) Business Days, after receipt by TribalRides of any such payment or reimbursement, TribalRides shall pay over to XNDA the amount of such payment or reimbursement, together with all corresponding notes, documentation and information received in connection therewith.

 

 

 

 

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(g)       Taxes.

 

(i)  TribalRides shall be responsible for and shall pay on Closing all Taxes payable in respect of the sale and transfer of the Purchased Assets to XNDA. TribalRides and the Shareholders shall be responsible for all tax implications of the XNDA Shares issued pursuant to this agreement.

 

(ii)  TribalRides and XNDA each agree, upon reasonable request from the other party, to cooperate fully in connection with the preparation and filing of any documents or Tax Returns with any Governmental Authority, and to use their commercially reasonable efforts to obtain any document from any Governmental Authority or any other Person as may be necessary or commercially advisable to mitigate, reduce or eliminate any Tax that could be imposed.

 

(h)       Contracts. Prior the Closing, to the extent that specific assignments may be necessary or appropriate in respect of any of the Purchased Assets, and/or to the extent that any of the Purchased Assets are represented by certificates of title or other documents, then TribalRides will execute and deliver to XNDA any additional transfer documents, and shall endorse to and in the name of XNDA all certificates of title and other such documents, as may be necessary or appropriate and requested by XNDA to effect the full transfer to XNDA all of the Purchased Assets. Notwithstanding anything to the contrary in this Agreement, this Agreement shall not constitute an agreement to assign or transfer any Assumed Contract if such assignment or transfer, or an attempt to make such an assignment or transfer, without the consent of a third party would constitute a material breach or materially affect adversely the rights of XNDA or TribalRides thereunder. To the extent that prior to the Closing Time, TribalRides has not obtained all necessary Consents required to assign or transfer any Assumed Contract to XNDA, TribalRides shall use its commercially best reasonable efforts to obtain such Consents as promptly as practicable thereafter. Until such Consents are obtained, TribalRides shall cooperate and shall cause its representatives to cooperate with XNDA in any arrangement designed to provide XNDA with the interests, rights and benefits of TribalRides under such Assumed Contract at no cost to XNDA in excess of the cost XNDA would have incurred, without modification to the terms of such Assumed Contract, if such Consent had been obtained. Nothing in this Section shall be deemed to constitute an agreement to exclude from the Purchased Assets any Assumed Contracts for which such Consents are not obtained; provided, however, that XNDA shall be responsible for, and shall promptly pay all reasonable costs and expenses of TribalRides to establish, implement, monitor, maintain, execute on, or carry into effect any such arrangement (including any reasonable costs and expenses incurred in connection with enforcing rights under any such Assumed Contract), which TribalRides shall not incur without XNDA’s prior written consent, to the same extent as if such Assumed Contract had been assigned or transferred at the Closing Time. The obligation of TribalRides to cooperate with XNDA set forth in this Section shall not require TribalRides to incur any expenses, liabilities or obligations or to provide any financial accommodation or to remain secondarily or contingently liable for any liabilities or obligations under any applicable Assumed Contract.

 

2.2       XNDA Capitalization; Pre-Closing and post-Closing Covenants.

 

(a)       [Reseerved]

 

 

ARTICLE 3

PURCHASE PRICE AND PAYMENT

 

3.1        Purchase Price; Payment. As consideration for the Asset Purchase (the consideration listed in Section 3.1(a) shall be considered the “Purchase Price”):

 

(a)       XNDA agrees to issue to TribalRides twenty-five million (25,000,000) newly issued shares of the common stock,, $0.001 par value, of XNDA (the “XNDA Stock”). In the aggregate, the shares of XNDA Stock issuable to the Shareholders will be approximately eighty-three percent (83%) of the issued and outstanding Preferred Stock of XNDA, which will have the right to convert into (and votes with respect to) approximately eighty-three percent (83%) of the issued and outstanding capital stock of XNDA, as of and immediately after the Closing. In addition, XNDA has or shall issue up to five million additional shares to other consultants in connection with the transactions contemplated hereby, and up to five million additional shares to accredited investors.

 

 

 

 

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(b)       Each of TribalRides, XNDA and the Shareholders agree that this transaction is intended to qualify under Section 368(a)(1)(C) of the Internal Revenue Code as a tax free transaction, and each Party agrees to execute and deliver such documents as may be reasonably requested by another Party to effectuate such intent

 

3.3        Location and Time of the Closing. The Closing shall take place electronically at 11:59 p.m., EST, on the Closing Date, or such other time on the Closing Date as may be agreed upon in writing between XNDA and TribalRides (the "Closing Time").

 

3.4        reserved.

 

3.5        Right of First Refusal. If XNDA shall choose to sell any Purchased Assets during the twelve (12) month period following the Closing, TribalRides and the Shareholders shall have a first right of refusal to purchase such Assets from XNDA at fair market value. TribalRides shall have a period of thirty days to elect to purchase the Assets related to the Purchased Assets, including the Purchased Assets. If TribalRides or the Shareholders do not exercise its right to purchase such Assets during the thirty day notice period, XNDA and/or XNDA shall have the right to sell such Assets.

 

3.6        Withholding Taxes. Notwithstanding any other provision in this Agreement, XNDA shall have the right to deduct and withhold Taxes from any payment to be made under this Agreement and any Transaction Documents if such withholding is required by any Applicable Laws and to collect all necessary Tax forms from TribalRides. To the extent that amounts are so withheld, such withheld amounts shall be treated for all purposes of this Agreement and any Transaction Document as having been delivered and paid to TribalRides.

 

 

ARTICLE 4

DUE DILIGENCE

 

4.1        Acknowledgements of XNDA. XNDA acknowledges that:

 

a)        it has performed a due diligence investigation into the Purchased Assets, with the assistance of professional consultants;

 

b)        the due diligence investigation has been performed to the satisfaction of XNDA as regards form, extent and depth;

 

c)        none of the findings of the due diligence investigation or any information provided within the framework of that investigation has caused XNDA to refrain from entering into this Agreement on the terms and conditions as stated herein;

 

d)        it has had ample opportunity to investigate the information provided by TribalRides, and:

 

e)        it has been granted access to buildings, accounts and documents related to the Purchased Assets;

 

f)        it has been given an opportunity to ask questions to TribalRides on all issues which XNDA has deemed relevant in respect of (the entering into) this Agreement and that, in XNDA’s opinion, these questions have been answered satisfactorily; and

 

g)        it has been able to discuss all matters which it deems relevant in respect of the Transaction.

 

All information provided by TribalRides to XNDA within the framework of the due diligence investigation, is accurate and no action was taken by Seller to hide or alter any information related to the Purchased Assets or the due diligence investigation. All information provided shall be considered disclosed. Consequently, without prejudice to any other provisions of this Agreement, (a) there will be no Claim and (b) the Seller will not be liable for any matter causing a Claim, insofar as XNDA was or should have been aware of a Claim on the Closing Date.

 

 

 

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ARTICLE 5

REPRESENTATIONS AND WARRANTIES OF TRIBALRIDES

 

TribalRides represents and warrants to XNDA as follows and acknowledges that XNDA is relying upon the representations and warranties set forth below in connection with its purchase of the Purchased Assets.

 

5.1        Incorporation and Authority. TribalRides is a corporation, duly organized, validly existing and in good standing under the laws of the State of Nevada. TribalRides has all requisite power and authority to own or lease and operate its properties and assets and to carry on the provision of its services.

 

5.2       Power and Capacity.

 

(a)        TribalRides has the corporate power, authority and capacity to execute and deliver this Agreement and the Transaction Documents and to perform its obligations under this Agreement and the Transaction Documents.

 

(b)        TribalRides Majority Shareholders have taken all necessary action to authorize the execution, delivery and performance of this Agreement and each of the Transaction Documents to which it is a party.

 

(c)        This Agreement has been duly authorized, executed and delivered by TribalRides and the TribalRides Board of Directors and constitutes the valid and binding agreement of TribalRides and is enforceable against TribalRides in accordance with its terms (except as the enforcement of such obligations may be limited by applicable bankruptcy, insolvency, reorganization, liquidation, receivership, moratorium and other Applicable Laws relating to or affecting the enforcement of creditors' rights generally and by general principles of equity (regardless of whether such enforcement is considered in a proceeding in equity or at law)).

 

5.3        Conflicts; Consents. The execution and delivery by TribalRides of this Agreement and the Transaction Documents does not, and the consummation of the transactions associated with this Agreement and the Transaction Documents will not:

 

(a)        violate any provision of the Organizational Documents of TribalRides;

 

(b)        result in the creation of any Encumbrance upon the Purchased Assets, nor will it conflict with or result in a breach of, require a Consent, create an event of default (or event that, with the giving of notice or lapse of time or both, would constitute an event of default) under, or give any Person the right to terminate, accelerate or modify any obligation or benefit under, any Assumed Contract or by which the Purchased Assets are bound or affected;

 

(c)        result in a violation of, or require the Consent, other action by, or registration, declaration or filing with or notice to, any Governmental Authority under any Applicable Law or Order applicable to the Purchased Assets. There is no pending or, to TribalRides’ Knowledge, threatened Proceeding against TribalRides or any TribalRides Shareholder before any Governmental Authority, to restrain or prevent the consummation of the transactions contemplated under this Agreement and the Transaction Documents or that might affect the right of XNDA to own and control the Purchased Assets; and

 

(d)        violate the UCC lien filings on the assets of TribalRides; and

 

(e)        contravene any Applicable Law.

 

 

 

 

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5.4       Properties and Assets. TribalRides is the owner of the Purchased Assets (other than Purchased Assets that are leased or licensed) with good and marketable title thereto, free of all Encumbrances (including from Taxes, other than Taxes not yet due and payable). No TribalRide Shareholder has any registered or beneficial interest in the Purchased Assets. Other than the UCC filings on the Purchased Assets, filed in the state of Delaware, there are no agreements or restrictions which in any way limit or restrict the transfer to XNDA of any of the Purchased Assets. Upon XNDA's payment of the Purchase Price, XNDA will own good, valid and marketable title to the Purchased Assets, free and clear of any and all Encumbrances and good and valid title to the Purchased Assets, free and clear of any and all Encumbrances, will pass to XNDA. XNDA shall not be liable in any way for any action taken with respect to the UCC lien on the Purchased Assets, and it shall be the Sellers’ sole responsibility to discharge all UCC liens on the Purchased Assets.

 

5.5       Compliance with Laws. TribalRides is not now, and has never been in violation of any provision of any Applicable Law or order applicable to TribalRides related to the Purchased Assets. TribalRides has not directly or indirectly made any payment of funds to any person, or received or retained any funds from any person in violation of any Applicable Law related to the Purchased Assets. No event has occurred or circumstance exists that (with or without notice or lapse of time) may constitute or result in a violation by TribalRides of, or a failure on the part of TribalRides to comply with, any Applicable Law in connection with the Purchased Assets. TribalRides has not received any notice or other communication (whether oral or written) from any Governmental Authority or any other Person regarding any actual, alleged, possible or potential violation of, or failure to comply with, any Applicable Law in connection with the Purchased Assets or any actual, alleged, possible or potential proceeding or obligation on the part of TribalRides to undertake, or to bear all or any portion of the cost of, any remedial action of any nature in connection with the Purchased Assets.

 

5.6        Consents and Approvals. No authorization, consent or approval of, or filing with or notice to, any Governmental Authority or other Person is required by TribalRides in connection with the execution, delivery or performance of this Agreement and the Transaction Documents or the completion of the transactions contemplated by this Agreement and the Transaction Documents. The transfer of the Purchased Assets will not violate any terms of the UCC lien filings related to the Purchased Assets.

 

5.7        Licenses, Permits, Orders and Authorizations. No licenses, approvals, consents, ratifications, waivers, notices, registrations, qualifications, designations, filings, franchises, authorizations, security clearances and other permits of, to, from or with, any Governmental Authority are required under Applicable Laws to permit TribalRides to own, operate, use and maintain the Purchased Assets in the manner in which they are now operated and maintained.

 

5.9        No Undisclosed Liabilities. TribalRides does not have any Liability related to the Purchased Assets (and there is no basis for any present or future Proceeding giving rise to any Liability), TribalRides has no Indebtedness related to the Purchased Assets and has not provided any Guarantee for any Indebtedness related to the Purchased Assets. It is understood by TribalRides and the Shareholders that XNDA is not assuming any liabilities of TribalRides, and XNDA shall not be responsible or liable for the lien on the Purchased Assets, which shall be discharged by Seller prior to Closing.

 

5.10       Tax Matters.

 

(a)        TribalRides has timely filed all Tax Returns required TribalRides under all Applicable Laws pertaining to Taxes and to which TribalRides is subject and all such Tax Returns are accurate and complete in all respects.

 

(b)        TribalRides has have timely paid all Taxes in respect of the Purchased Assets and the Purchased Assets which are capable of forming or resulting in an Encumbrance on the Purchased Assets or of becoming a Liability or obligation of XNDA.

 

(c)        Any and all Liabilities of TribalRides for Taxes attributable to taxable years ending on or before the Closing Date, whether or not due as of the Closing Date, have been accrued as Liabilities on the TribalRides Financial Statements and shall be the responsibility of TribalRides (and/or the TribalRide Management) and there are no Taxes outstanding as of the Closing Date.

 

 

 

 

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(d)        No examination or audit of any Tax Return of TribalRides is in progress. All deficiencies proposed as a result of any examination or audit of any Tax Return filed by TribalRides has been paid or finally settled and no issue has been raised in any such examination or audit that, by application of similar principles, reasonably can be expected to result in the assertion of a deficiency for any other year not so examined or audited.

 

(e)        There are no Proceedings pending against TribalRides in respect of any Taxes in respect of the Purchased Assets, nor has any such event been asserted or threatened against TribalRides.

 

(f)        There are no Encumbrances related to Taxes outstanding against any of the Purchased Assets other than for Taxes not yet due and payable.

 

5.11        Litigation. There is no Proceeding against or involving TribalRides (whether in progress or threatened) and no Proceeding has ever been commenced against TribalRides related to any Purchased Asset. No event has occurred which might give rise to any Proceeding and there is no Order of any Governmental Authority related to any Purchased Asset to which TribalRides is subject.

 

5.12        Corrupt Practices. Neither TribalRides nor, to the Knowledge of TribalRides, any officer, director, employee, advisor or agent of TribalRides, has made any payment, directly or indirectly, on behalf of or to the benefit of TribalRides, in violation of any Applicable Laws prohibiting the payment of undisclosed commissions or bonuses or the making of bribe or incentive payments or other arrangements of a similar nature with respect to the conduct of the Purchased Assets, including the Foreign Corrupt Practices Act (U.S.), and TribalRides has instituted and maintains policies and procedures designed to ensure continued compliance with such Applicable Laws.

 

5.13       reserved.

 

5.14        Contracts. Correct and complete copies of all written Contracts related to the Purchased Assets are disclosed in the TribalRides Disclosure Schedule. The Contracts disclosed in the TribalRides Disclosure Schedule represent all of the Assigned Contracts and each such Contract is a legal and valid obligation of TribalRides and;

 

(a)        each other Person party thereto, binding and enforceable against TribalRides and, each other Person party thereto, in accordance with its terms;

 

(b)        no such Contract has been terminated and neither TribalRides, nor, any other Person is in breach or default thereunder, no event has occurred that with notice or lapse of time, or both, would constitute a breach or default, or permit termination, modification in any manner adverse to TribalRides, or acceleration thereunder;

 

(c)        no party has asserted or has (except by operation of law) any right to offset, discount or otherwise abate any amount owing under any such Contract except as expressly set forth in such Contract;

 

(d)        no party to any Assumed Contract intends to cancel, terminate or exercise any option under any Assumed Contract; and

 

(e)        TribalRides has not made any prior assignment of any Assumed Contract or any of its rights or obligations thereunder.

 

5.15        No Default. TribalRides is not in violation or breach of, or default under, and there exists no event, condition or occurrence which, with notice or passage of time or both, would constitute a default under, or give rise to any termination rights under, any provision of an Assumed Contract, license, concession, franchise, permit or grant with respect to the Purchased Assets.

 

 

 

 

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5.16        Insurance. TribalRides has not and has never held any insurance policies in respect of the Purchased Assets.

 

5.17        Employee Plans; ERISA. TribalRides currently does not and never has established an Employee Plan of any kind. TribalRides does not have any Liability with respect to any Person under Title IV of ERISA.

 

5.18        Intellectual Property.

 

(a)        Except for Licensed Intellectual Property, all Intellectual Property used, in whole or in part by TribalRides in connection with the Purchased Assets is Owned Intellectual Property.

 

(b)        The TribalRides Disclosure Schedule lists all Owned Intellectual Property that consist of trade marks and trade mark applications, trade names, certification marks, patents and patent applications, copyrights and industrial designs, the offices (if any) in which the same is registered (being the only offices where such registration is necessary to preserve the right thereto); and the applicable expiry dates of any registration.

 

(c)        The TribalRides Disclosure Schedule lists all Licensed Intellectual Property.

 

(d)        All Owned Intellectual Property is owned by TribalRides free and clear of Encumbrances, covenants, conditions, options to purchase and restrictions or other adverse claims or interests of any kind or nature.

 

(e)        To the extent that any Intellectual Property used by, or developed on behalf of, TribalRides for use in connection with the Purchased Assets was created by an employee of, or independent contractor or consultant to, TribalRides, such Persons have each irrevocably assigned to TribalRides in writing all rights to such Intellectual Property; TribalRides has not received any notice or claim challenging ownership of or rights by TribalRides to such Intellectual Property or suggesting that such Person has any claim of legal or beneficial ownership or other claim or interest with respect thereto nor, is there a reasonable basis for such a claim.

 

(f)        All current and former directors, officers, employees, consultants and independent contractors of TribalRides have entered into enforceable confidentiality agreements with TribalRides in form adequate to protect the Owned Intellectual Property.

 

(g)        All rights to the Owned Intellectual Property or Licensed Intellectual Property are valid and enforceable. TribalRides has not received any notice or claim challenging or questioning the validity or enforceability of any Owned Intellectual Property or Licensed Intellectual Property. There is no Proceeding which is ongoing or, alleged (including any opposition, re-examination or protest) which might result in the Owned Intellectual Property being invalidated, revoked or the subject of a compulsory license. To the Knowledge of TribalRides, there is no Proceeding which is ongoing or alleged (including any opposition, re- examination or protest) which might result in the Licensed Intellectual Property being invalidated or revoked or the subject of a compulsory license.

 

(h)        In the case of Licensed Intellectual Property, TribalRides has entered into valid and enforceable written agreements (the "License Agreements") pursuant to which TribalRides has been granted all licenses to develop manufacture, import, export, use, reproduce, sub-license, sell, offer for sale, or otherwise exploit the Licensed Intellectual Property to the extent required to operate all aspects of the Purchased Assets. All License Agreements are in full force and effect and neither TribalRides nor any licensor is in default of its obligations thereunder. Correct and complete copies of all License Agreements have been made available to XNDA.

 

(i)        All fees payable in respect of the maintenance of Owned Intellectual Property have been paid and all registrations and applications for registration of any Owned Intellectual Property are in good standing; TribalRides has prosecuted, and is prosecuting, such applications diligently. All fees payable in respect of the maintenance of the Licensed Intellectual Property have been paid and all registrations and applications for registration of any Licensed Intellectual Property are in good standing and, to the Knowledge of TribalRides, the licensors of the Licensed Intellectual Property have prosecuted, and are prosecuting, such applications diligently.

 

 

 

 

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(j)        To the Knowledge of TribalRides, there has been no infringement of any other Person's rights to Intellectual Property and no facts exist which would reasonably lead to such infringement.. TribalRides is not or has not been a party to Proceeding nor, to the Knowledge of TribalRides has any Proceeding been threatened, that alleges that the conduct of the Purchased Assets infringes any other Person's rights to the Owned Intellectual Property or the Licensed Intellectual Property. To the Knowledge of TribalRides, no Person has infringed or is infringing the right of TribalRides in or to any Owned Intellectual Property or Licensed Intellectual Property.

 

(k)        TribalRides is not a party to any agreement involving the grant by TribalRides to any Person of any right to the Owned Intellectual Property.

 

5.24        Computer Systems. Schedule 5.24 to the TribalRides Disclosure Schedule sets out an accurate and complete list of all:

 

(a)        machinery, equipment, parts and accessories that is or includes computer or communications hardware owned or operated by or on behalf of TribalRides in connection with the Purchased Assets (the "Computer Systems Hardware");

 

(b)        Intellectual Property that is computer software (including, where applicable, documentation, source code and back-ups) owned or used by or on behalf of TribalRides in connection with the Purchased Assets, whether stored on or off-site (the "Computer Systems Software");

 

(c)        machinery and equipment which incorporates or relies upon Computer Systems Hardware or Computer Systems Software (the "Computer Dependent Equipment");

 

(d)        permits, licences, approvals, consents, authorizations, registrations, certificates and franchises (including applicable expiry dates) relating to Computer Systems Hardware, Computer Systems Software and Computer Dependent Equipment; and

 

(e)        Contracts relating to Computer Systems Hardware, Computer Systems Software and Computer Dependent Equipment, including, all relevant maintenance, extended warranty, software escrow, network service, service bureau, outsourcing and on-line service agreements and arrangements (the "Computer Systems Contracts").

 

(f)        the original media for any Computer Systems Software purchased by TribalRides, together with proofs of purchase, are available to facilitate upgrades. All Computer Systems Hardware and Computer Dependent Equipment has been installed and operated at all times in accordance with applicable manufacturers' or suppliers' maintenance or warranty requirements.

 

5.25        Assets in Good Condition. All the physical Assets comprising the Purchased Assets are in good operating condition and in a state of good maintenance and repair having regard to the use to which the Assets are put and the age thereof. There are no facts or conditions affecting the Purchased Assets which could interfere in any respect with the use, occupancy or operation of the Purchased Assets as currently used, occupied or operated.

 

5.26        Inventory; Product Warranties and Claims.

 

(a)       TribalRides has no inventory, finished goods, work in process or raw materials.

 

(b)       TribalRides has not given any written or oral product warranty, express or implied, and no product warranty or product liability claim (or claim in the nature thereof) against TribalRides in respect of the products manufactured or sold in respect of the Purchased Assets has been made or, threatened, since TribalRides’ incorporation, nor do facts or circumstances exist that could reasonably be expected to result in any such claim. TribalRides has not made a product warranty or liability claim (or claim in the nature thereof) against any supplier thereto in respect of the products manufactured or sold in respect of the Purchased Assets since TribalRides' incorporation.

 

 

 

 

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5.27       Environmental Matters.

 

(a)       TribalRides has not emitted, discharged, deposited or released or caused or permitted to be emitted, discharged, deposited or released, any Hazardous Materials on, from, under or to any premises or area owned, leased or utilized by TribalRides, or in connection with the operation of the Purchased Assets, except in compliance with Applicable Laws;

 

(b)       There has been no exposure of any Person or property to Hazardous Materials generated by or in connection with the operation of the Purchased Assets by TribalRides that could reasonably be expected to form the basis for a claim for injuries, damages or compensation; and

 

(c)       TribalRides has not permitted any premises or area owned, leased or utilized by TribalRides to be used for the disposal of any Hazardous Material.

 

5.28       Privacy Laws. TribalRides is in material compliance with all Applicable Laws in respect of: (a) the collection, use and storage by TribalRides of Personal Information in the course of the Purchased Assets; and (b) the disclosure or transfer to third parties by TribalRides of Personal Information in the course of the Purchased Assets.

 

5.29       Books of Account. The books and records of TribalRides maintained in respect of the Purchased Assets accurately record all financial transactions in respect of the Purchased Assets.

 

5.30       Brokers' Fees. No broker, finder, investment banker or other Person is entitled to any brokerage fee, finders' fee or other commission or payment in connection with the transactions contemplated by this Agreement based on arrangements made by TribalRides.

 

5.31       Bulk Sales Act. TribalRides shall, prior to closing, provide XNDA with an affidavit outlining all of TribalRides’ secured and unsecured creditors, and shall take all actions, including filing such affidavit with such government department or court as is necessary to perfect such affidavit. TribalRides understand and agree that XNDA shall not be liable to any creditors of TribalRides, and shall not be held responsible or liable for any action by any TribalRides creditors who obtain a declaration that the sale of the Purchased Assets was invalid, or for any TribalRides creditors who attempt, or actually take possession of any of the Purchased Assets.

 

5.32       Material Facts Disclosed. Neither this Agreement, the Transaction Documents, nor any Schedule or Exhibit attached hereto furnished to XNDA by TribalRides contains any untrue statement of a material fact or omits to state a material fact necessary in order to make the statements contained therein or herein, in light of the circumstances under which they were made, not misleading.

 

 

ARTICLE 6

REPRESENTATIONS AND WARRANTIES OF XNDA

 

XNDA represents and warrants to TribalRides and the Shareholders as follows and acknowledges that TribalRides and the Shareholders are relying upon the representations and warranties set forth below in connection with the sale of the Purchased Assets.

 

6.1        Incorporation and Authority. XNDA is a corporation, duly organized, validly existing and in good standing under the laws of the State of Colorado. XNDA has all requisite power and authority to own or lease and operate its properties and Assets and to carry on the provision of their services.

 

6.2        Power and Capacity.

 

(a)              XNDA has the corporate power, authority and capacity to execute and deliver this Agreement and the Transaction Documents and to perform its obligations under this Agreement and the Transaction Documents.

 

 

 

 

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(b)              XNDA has taken all necessary action to authorize the execution, delivery and performance of this Agreement and each of the Transaction Documents to which it is a party.

 

(c)              This Agreement has been duly authorized, executed and delivered by XNDA and constitutes the valid and binding agreement of XNDA and is enforceable against XNDA in accordance with its terms (except as the enforcement of such obligations may be limited by applicable bankruptcy, insolvency, reorganization, liquidation, receivership, moratorium and other Applicable Laws relating to or affecting the enforcement of creditors' rights generally and by general principles of equity (regardless of whether such enforcement is considered in a proceeding in equity or at law).

 

6.3        Conflicts; Consents. The execution and delivery by XNDA of this Agreement and the Transaction Documents does not, and the consummation of the transactions associated with this Agreement and the Transaction Documents does not and will not:

 

(a)              violate any provision of the Organizational Documents of XNDA;

 

(b)              result in the creation of any Encumbrance upon the provision of any of XNDA's services, nor will it conflict with or result in a breach of, require a Consent, create an event of default (or event that, with the giving of notice or lapse of time or both, would constitute an event of default) under, or give any Person the right to terminate, accelerate or modify any obligation or benefit under, any Contract to which XNDA is a party;

 

(c)              result in a violation of, or require the Consent, other action by, or registration, declaration or filing with or notice to, any Governmental Authority under any Applicable Law or order applicable to XNDA and the provision of any of XNDA's services; and

 

(d)              contravene any Applicable Law.

 

6.4        Solvency. XNDA is not now insolvent and will not be rendered insolvent by any of the transactions contemplated under this Agreement and the Transaction Documents. As used in this section, "insolvent" means that the sum of the Liabilities of XNDA, as applicable, exceeds the present fair saleable value of XNDA's. Immediately after giving effect to the consummation of the transactions contemplated under this Agreement and the Transaction Documents: (a) XNDA will be able to pay its Liabilities as they become due in the usual course of its business; (b) XNDA will not have unreasonably small capital with which to conduct its present or proposed business; and (c) XNDA will have Assets (calculated at fair market value) that exceed its Liabilities.

 

6.5        Authorized Capital. The authorized capital of the XNDA consists of 50,000,000 shares of common stock, of which 5,857,500 are issued and outstanding, and no shares of Series A Preferred Stock.

 

6.6        Valid Issuance of Securities. The XNDA Stock comprising the Purchase Price that are being issued to TribalRides and ASKCO hereunder when issued and delivered in accordance with the terms hereof for consideration in accordance with the terms hereof will be duly and validly issued, fully paid and non-assessable and free of restrictions on transfer other than restrictions on transfer in the Organizational Documents, and applicable securities laws and regulations.

 

6.7        Tax Matters. XNDA has timely filed all Tax Returns required under all Applicable Laws pertaining to Taxes and to which XNDA is subject. XNDA has timely paid all Taxes required by Applicable Laws to be paid, whether or not shown on any Tax Return. All such Tax Returns are accurate and complete. No examination or audit of any Tax Return of XNDA is in progress.

 

6.8        Undisclosed Liabilities. XNDA nor any of its subsidiaries has any Liability (and there is no basis for any present or future Proceeding against any of them giving rise to any Liability), except for (a) Liabilities set forth on the face of the most recent balance sheet (rather than in any notes thereto) and (b) Liabilities that have arisen after the most recent fiscal month end in the ordinary course of business (none of which results from, arises out of, relates to, is in the nature of, or was caused by any breach of contract, breach of warranty, tort, infringement, or violation of law).

 

 

 

 

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ARTICLE 7 [RESERVED]

 

 

ARTICLE 8

CLOSING DELIVERIES AND CONDITIONS

 

8.1        Closing Deliveries from TribalRides to XNDA. On or prior to the Closing Time, TribalRides will duly execute, if applicable, and deliver to XNDA:

 

(a)        Consents and Orders. Evidence that TribalRides has, at TribalRides' expense and without cost or other adverse consequence to XNDA, sent all notices, made all filings and obtained all Consents and Orders required to be sent, made and obtained by TribalRides in connection with the execution and delivery of this Agreement, the Transaction Documents and the consummation of the transactions contemplated hereunder; provided, that, it shall not be a condition to Closing that TribalRides obtain any Consents with respect to any Assumed Contracts that qualify under Section 2.1(h).

 

(b)        Delivery of Agreements. On or prior to the Closing Time, the following agreements shall have been delivered to XNDA, in form and substance satisfactory to XNDA:

 

(i)  a certificate of status for TribalRides issued as of the Closing Date by the applicable Governmental Authority;

 

(ii)  copies of resolution of the TribalRides Management, as applicable, authorizing and approving the execution, delivery and performance of this Agreement, the Transaction Documents and the consummation of the transactions contemplated hereunder;

 

(iii)  the TribalRides Disclosure Schedule;

 

(iv)  TribalRides IP Assignment Agreements duly executed by TribalRides;

 

(v)  the Bill of Sale;

 

(vi)  Assignment and Assumption Agreement;

 

(vii)  An affidavit filed with the proper government department detailing the secured and unsecured creditors of TribalRides;

 

(viii)  such other bills of sale, assignments, deeds, certificates of title, documents and other instruments of transfer and conveyance as may be reasonably requested by XNDA, each in form and substance satisfactory to XNDA, dated the Closing Date and duly executed by TribalRides;

 

(ix)  any other assurances, agreement, documents and instruments as may be reasonably requested by XNDA to effect the transactions contemplated by this Agreement and the Transaction Documents.

 

(c)        Discharge of Charges. TribalRides shall have delivered to XNDA evidence in form and substance satisfactory to XNDA, acting reasonably, that all Governmental Charges affecting the Purchased Assets have been discharged in full, other than any Governmental Charges which, pursuant to the terms of this Agreement, are not required to be discharged.

 

(d)        Change of Name. TribalRides shall deliver an instrument in writing, in form and substance satisfactory to XNDA, acting reasonably, whereby it agrees that within one year after the Closing Date it will take or cause to be taken all such action as may be necessary to change the name of TribalRides to some other name which does not include "Coordinates Collection, Inc." or any similar name.

 

 

 

 

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(e)        Delivery of Books and Records. Within five (5) days after the Closing Date, TribalRides shall have delivered to XNDA all books, records, lists of suppliers and customers and other documents, files and data relating to the Purchased Assets, all of which shall become the property of XNDA.

 

8.2       Closing Deliveries from XNDA.

 

At the Closing, XNDA will duly execute, if applicable, and deliver to TribalRides:

 

(a)        copies of resolutions of XNDA's directors, managers, managing members or the shareholders, as the case may be, authorizing and approving the execution, delivery and performance of this Agreement, the Transaction Documents and the consummation of the transactions contemplated hereunder;

 

(b)        the executed counterpart signature page of XNDA to the Assignment Assumption Agreement and Consulting Agreement;

 

(c)        any other assurances, agreement, documents and instruments as may be reasonably requested by XNDA to effect the transactions contemplated by this Agreement and the Transaction Documents.

 

(d)        a stock certificate or certificates evidencing the Purchase Price;

 

(e)        copies of resolutions of XNDA's directors, managers, managing members or the shareholders, as the case may be, authorizing and approving the execution, delivery and performance of this Agreement, the Transaction Documents and the consummation of the transactions contemplated hereunder;

 

(f)        any other assurances, agreement, documents and instruments as may be reasonably requested by TribalRides or the Shareholders to effect the transactions contemplated by this Agreement and the Transaction Documents.

 

 

ARTICLE 9

INDEMNIFICATION AND BREACH OF WARRANTIES

 

9.1        Breach of Warranties and Indemnification by TribalRides. Subject to the limitations contained in this Agreement, TribalRides agrees to indemnify and hold XNDA, its directors, officers, employees and representatives (each, an "XNDA Indemnified Party" and collectively, the "XNDA Indemnified Parties") harmless from and after the Closing Time, against and in respect of any Losses resulting from:

 

(a)        any Loss of any XNDA Indemnified Party or the Purchased Assets as a result of any breach of representation or warranty by TribalRides or any TribalRides Shareholder contained in this Agreement, the TribalRides Disclosure Schedule or the Transaction Documents or in any certificate or document delivered pursuant to or contemplated by this Agreement or any Transaction Document;

 

(b)        any Loss of any XNDA Indemnified Party or the Purchased Assets as a result of any breach or any non-fulfilment of any covenant or agreement on the part of TribalRides or any TribalRides Shareholder contained in this Agreement, the TribalRides Disclosure Schedule or the Transaction Documents or in any certificate or document delivered pursuant to or contemplated by this Agreement or any Transaction Document;

 

(c)        any Loss of any XNDA Indemnified Party or the Purchased Assets relating to any matter in regards to the Purchased Assets that occurred on or prior to the Closing Time that is not an Assumed Liability;

 

(d)        any Loss of any XNDA Indemnified Party or the Purchased Assets arising, directly or indirectly, from a Retained Liability paid by XNDA;

 

 

 

 

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(e)        any warranty, damage or similar claim made against any XNDA Indemnified Party for or arising from defects in any goods, materials or workmanship, in each case provided by TribalRides on or prior to the Closing Time for which any XNDA Indemnified Party is or is alleged to be liable; and

 

(f)        any loss of XNDA related to any TribalRides creditor, which shall include, but not be limited to, any claim that the sale of the Purchased Assets was invalid due to any Bulk Sales Act provision; and

 

(g)        all claims, demands, costs and expenses, including reasonable legal expenses, in respect of the foregoing.

 

In the case of a breach or breaches of any TribalRides Warranty or Warranties listed in this Agreement, and in order to provide an opportunity for TribalRides to remedy a Breach, to limit the existence and/or the extent of the Damage, or to determine which steps must be taken to limit the Damage, XNDA shall:

 

a)        give notice of facts and/or circumstances that may give cause for filing a claim by virtue of this Agreement within a period of one month after those facts and/or circumstances have been discovered;

 

b)        provide TribalRides and its advisors with all relevant information relating to the potential Breach;

 

c)        not accept or acknowledge any liability on account of any Claim which may give rise to a Claim against TribalRides without its prior written consent;

 

d)        enable TribalRides – if it so desires – to set up its own defense against any claims filed by third parties, which claims are based on the Breach.

 

XNDA hereby declares to be unaware of any Breach of TribalRides’ Warranties as at the date of this Agreement.

 

9.2        Indemnification by XNDA. Subject to the limitations contained in this Agreement, XNDA agrees to indemnify and hold TribalRides and its directors, officers, employees and representatives (each, a "Seller Indemnified Party" and collectively, the "Seller Indemnified Parties") harmless from and after the Closing Time, against and in respect of any Losses resulting from:

 

(a)        any Loss of any Seller Indemnified Party as a result of any breach of representation or warranty by XNDA contained in this Agreement or the Transaction Documents or in any certificate or document delivered pursuant to or contemplated by this Agreement or any Transaction Document;

 

(b)        any Loss of any Seller Indemnified Party as a result of any breach or any non-fulfilment of any covenant or agreement on the part of XNDA contained in this Agreement or the Transaction Documents or in any certificate or document delivered pursuant to or contemplated by this Agreement or any Transaction Document;

 

(c)        any Loss of any Seller Indemnified Party arising, directly or indirectly, from an Assumed Liability;

 

(d)        any Loss of any XNDA Indemnified Party or the Purchased Assets relating to any matter in regards to the Purchased Assets that occurred after the Closing Time, provided, that such matter is not as a result of the actions of any Seller Indemnified Party prior to the Closing Time; and

 

(e)        all claims, demands, costs and expenses, including reasonable legal expenses, in respect of the foregoing.

 

 

 

 

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9.3        Notice of Claim. If XNDA, XNDA or TribalRides wishes to make a Claim on their own behalf or on behalf of a XNDA Indemnified Party or Seller Indemnified Party, as applicable, such party shall promptly give notice to the other of the Claim. Notice of any Claim shall specify with reasonable particularity (to the extent that the information is available):

 

(a)        the factual basis for the Claim, and any provisions of the Agreement, or of any Applicable Laws, relied upon; and

 

(b)        the amount of the Claim or, if an amount is not then determinable, an approximate and reasonable estimate of the potential amount of the Claim.

 

9.4        Procedure for Indemnification by XNDA Indemnified Parties.

 

(a)        Direct Claims. Following receipt of notice of a Direct Claim, either the Sellers, the Holders or XNDA, as applicable, (each an "Indemnifying Party") shall have 30 days to make such investigation of the Direct Claim as the Indemnifying Party considers necessary or desirable, as applicable. For the purpose of such investigation, either the applicable XNDA Indemnified Party or the applicable Seller Indemnified Party (each an "Indemnified Party") shall make available to the Indemnifying Party and its representatives the information relied upon by Indemnified Party to substantiate the Direct Claim. If Indemnified Party and the Indemnifying Party agree at or prior to the expiration of such 30-day period (or any extension thereof agreed upon by the parties) as to the validity and amount of the Direct Claim, Indemnifying Party and Indemnified Party shall execute a settlement agreement and Indemnifying Party shall immediately pay to Indemnified Party the full agreed upon amount of the Direct Claim, and the terms of Section 8.1 shall apply in respect of such payment. If such parties do not agree within such period (or any mutually agreed upon extension thereof), the Indemnifying Party and Indemnified Party agree that the dispute shall be submitted to the dispute resolution procedures under Section 9.4.

 

(b)        Third Party Claims.

 

(i)  With respect to any Third Party Claim, the Indemnifying Party shall have the right, at its own expense, to participate in or assume control of the negotiation, settlement or defense of the Third Party Claim and, in such event, the Indemnifying Party shall reimburse the Indemnified Party for all of the Indemnified Party's out-of-pocket expenses as a result of such participation or assumption. If the Indemnifying Party elects to assume such control, the Indemnified Party shall have the right to participate in the negotiation, settlement or defense of such Third Party Claim at its own expense and shall have the right to disagree on reasonable grounds with the selection and retention of legal counsel, in which case legal counsel satisfactory to both the Indemnifying Party and the Indemnified Party shall be retained by the Indemnifying Party.

 

(ii)  If the Indemnifying Party, having elected to assume control as contemplated in Section 9.4(b)(i), thereafter fails to defend such Third Party Claim within a reasonable time, the Indemnified Party shall be entitled to assume such control and the Indemnifying Party shall be bound by the results obtained by the Indemnified Party with respect to such Third Party Claim.

 

(iii)  In the event that any Third Party Claim is of a nature such that the Indemnified Party is required by Applicable Laws to make a payment to any Third Party with respect to such Third Party Claim before the completion of settlement negotiations or related legal proceedings, the Indemnified Party may make such payment and the Indemnifying Party shall, forthwith after demand by the Indemnified Party, reimburse the Indemnified Party for any such payment. If the amount of any liability under the Third Party Claim in respect of which such a payment was made, as finally determined, is less than the amount which was paid by the Indemnifying Party to the Indemnified Party, the Indemnified Party shall, forthwith after receipt of the difference from the Third Party, pay such difference to the Indemnifying Party.

 

(iv)  Except in the circumstances contemplated by Section 9.4(b)(ii), whether or not the Indemnifying Party assumes control of the negotiation, settlement or defense of any Third Party Claim, the Indemnified Party shall not negotiate, settle, compromise or pay any Third Party Claim except with the prior written consent of the Indemnifying Party (which consent shall not be unreasonably delayed or withheld).

 

 

 

 

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(v)  The Indemnified Party shall not permit any right of appeal in respect of any Third Party Claim to terminate without giving the Indemnifying Party notice thereof and an opportunity to contest such Third Party Claim.

 

(vi)  The Parties shall cooperate fully with each other with respect to Third Party Claims, shall keep each other fully advised with respect thereto (including supplying copies of all relevant documentation promptly as it becomes available) and shall each designate a senior officer who will keep himself/herself informed about and be prepared to discuss the Third Party Claim with his or her counterpart and with legal counsel at all reasonable times.

 

(vii)  Notwithstanding anything to the contrary contained herein, the Indemnifying Party shall not settle any Third Party Claim without the consent of the Indemnified Party unless the settlement includes a complete release of the Indemnified Party with respect to the Third Party Claim and does not include any admission of guilt or fault on the part of the Indemnified Party.

 

9.5        Subrogation. In the event that an Indemnifying Party shall be obligated to indemnify an Indemnified Party pursuant to the terms of this Agreement, the Indemnifying Party shall, upon fulfillment of its obligations with respect to indemnification (including payment in full of all amounts due pursuant to its indemnification obligations) be subrogated to all rights of the Indemnified Party with respect to the claims to which such indemnification relates.

 

9.6       Limitations on Indemnification. Notwithstanding anything to the contrary herein notwithstanding:

 

(a)       Limitations on TribalRides' Liability for Indemnification. TribalRides shall be required to indemnify any XNDA Indemnified Party for any Loss arising in respect of Claims for breaches or representations and warranties pursuant Section 8.1(a); provided, that, the aggregate indemnification Liability to be paid by TribalRides under Section 9.1(a) shall be $1,000.00 (the "Seller Cap"). Notwithstanding the foregoing, the Seller Cap shall not apply to, or otherwise reduce or limit a Claim for:

 

(i)  for a breach of the representations and warranties contained in Sections 4.1 (Incorporation and Authority), 4.2 (Power and Capacity), 4.3 (Conflicts; Consents), 4.6 (Properties and Assets), 4.8 (Consents and Approvals), 4.9 (Licenses, Permits, Orders and Authorizations), 4.12 (Tax Matters), 4.13 (Litigation); 4.25 (Intellectual Property) and 4.30 (Environmental Matters);

 

(ii)  for a breach of any of the TribalRides IP Assignment Agreements; or

 

(iii)  any lawsuit or loss or action involving XNDA related to the lien on the Purchased Assets or any liabilities of TribalRides.

 

(iv)  any Loss caused by fraud, gross negligence or willful misconduct of TribalRides or any TribalRides Shareholder.

 

(b)       Limitations on XNDA's Liability for Indemnification. XNDA shall be required to indemnify any Seller Indemnified Party for any Loss arising in respect of Claims for breaches of representations and warranties pursuant to Section 8.2(a).

 

9.7        Exclusive Remedy. The rights of indemnity set forth in this Article 9 are the sole and exclusive remedy of each Party in respect of any misrepresentation, breach of warranty or breach of covenant by the other Party hereunder. Accordingly, each Party waives, from and after the Closing Time, any and all rights, remedies and claims that such Party may have against the other, whether at law, under any statute or in equity (including but not limited to claims for breach of contract, breach of representation and warranty, negligent misrepresentation and all claim for breach of duty), or otherwise, directly or indirectly, relating to the provisions of this Agreement or the transactions contemplated by the Agreement or the Transaction Documents other than as expressly provided for in this Article 9 and other than those arising from fraud, gross negligence or willful misconduct. The Parties agree that if a Claim is made by one Party in accordance with Section 9.1 or 9.2, as the case may be, and there has been a refusal by the other Party to make payment or otherwise provide satisfaction in respect of such Claim, then a Proceeding in accordance with Section 9.4 is an appropriate means to seek a remedy for such refusal. This Article shall remain in full force and effect in all circumstances and shall not be terminated by a breach (fundamental, negligent or otherwise) by any part of its representations, warranties or covenants hereunder or under any documents delivered pursuant hereto or by any termination or rescission of this Agreement by any Party. Notwithstanding the foregoing, in the event of a breach of Article 10 or a breach by TribalRides of any TribalRides IP Assignment Agreement to which it is a party, the aggrieved party shall be entitled to seek immediate injunctive relief and for avoidance of doubt, the Seller Cap shall not apply in the event of a breach of Article 10 or any TribalRides IP Assignment Agreement to which it is a party.

 

 

 

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9.8        Survival of Representations, Warranties and Covenants. To the extent that they have not been fully performed at or prior to the Closing Time, the representations and warranties, covenants and agreements contained in this Agreement and in all certificates and documents delivered pursuant to or contemplated by this Agreement shall terminate at the expiration of 18 months following the Closing, except the representations and warranties contained in:

 

(a)  Sections 5.1 (Incorporation and Authority), 5.2 (Power and Capacity), 5.3 (Conflicts; Consents), 5.6 (Properties and Assets), 5.7 (Compliance with Laws), 5.8 Consents and Approvals), 5.9 (Licenses, Permits, Orders and Authorizations), 5.13 (Litigation); 5.25 (Intellectual Property) and 5.30 (Environmental Matters);

 

(b)  Sections 6.1 (Incorporation and Authority), 6.2 (Power and Capacity) and 6.3 (Conflicts; Consents);

 

(c)  Sections 7.1 (Incorporation and Authority), 7.2 (Power and Capacity), 7.3 (Conflicts; Consents);

 

(d)  Section 5.12 (Tax Matters) in respect of any Taxes arising in or in respect of a period shall terminate on the date which is the day after the relevant Governmental Authority is no longer entitled to assess or reassess liability for Taxes (other than interest on any Tax owing) against TribalRides, as the case may be, for that period, having regard, without limitation, to any waivers given by TribalRides in respect of such period, except to the extent that any misrepresentation has been made or any fraud has been committed by TribalRides in filing a Tax Return or in supplying information for the purposes of any Applicable Law imposing Tax on TribalRides; and

 

(e)  Section 7.6 (Tax Matters) in respect of any Taxes arising in or in respect of a period shall terminate on the date which is the day after the relevant Governmental Authority is no longer entitled to assess or reassess liability for Taxes (other than interest on any Tax owing) against the Shareholders, as the case may be, for that period, having regard, without limitation, to any waivers given by the Shareholders in respect of such period, except to the extent that any misrepresentation has been made or any fraud has been committed by the Shareholders in filing a Tax Return or in supplying information for the purposes of any Applicable Law imposing Tax on the Shareholders.

 

The period of time a representation, warranty, covenant or agreement survives the Closing pursuant to this Section 9.8 shall be the "Survival Period" with respect to such representation, warranty, claim or agreement. So long as a XNDA Indemnified Party or a Seller Indemnified Party, as applicable, gives notice of a Claim on or before the expiration of the applicable Survival Period, a XNDA Indemnified Party shall be entitled to pursue its rights to indemnification under Section 9.1 of the Agreement and a Seller Indemnified Party shall be entitled to pursue its rights to indemnification under Section 9.2 and 9.3 of the Agreement. In the event notice of any Claim under Sections 9.1, 9.2 and 9.3 the Agreement shall have been given within the applicable Survival Period and such Claim has not been finally resolved by the expiration of such Survival Period, the representations, warranties, covenants or agreements that are the subject of such Claim shall survive the end of the Survival Period of such representations, warranties, covenants and agreements until such Claim is finally resolved, but such representations, warranties, covenants and agreements shall only survive with respect to such asserted Claim. The waiver of any condition based on the accuracy of any representation or warranty, or on the performance of or compliance with any covenant or obligation, will not adversely affect the right to indemnification, payment of Losses or other remedy based on such representations, warranties, covenants or obligations.

 

 

ARTICLE 10

CONFIDENTIALITY

 

10.1        Confidentiality. The Parties shall treat the terms of this Agreement and all information provided under or in connection with this Agreement (collectively, "Confidential Information") as confidential and may not either disclose Confidential Information or use it other than for bona fide purposes connected with this Agreement, the Purchased Assets or any other agreements or instruments in any way related to this Agreement without the prior written consent of the other Parties, provided, that, XNDA shall make all necessary regulatory filings with the Securities and Exchange Commission, including, but not limited to a Form 8-K, and consent is also not required for disclosure to:

 

(a)        an affiliate of a Party to this Agreement, directors, officers, shareholders or employees of a Party or an affiliate to a Party, as long as they in turn are required to treat the Confidential Information as confidential on terms substantially the same as those set out in this Section 10.1;

 

 

 

 

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(b)        accountants, professional advisers and bankers and other lenders, whether current or prospective, as long as they are subject to statutory professional secrecy rules or similar legal concepts under Applicable Laws or, in turn, are required to treat the Confidential Information as confidential on terms substantially the same as those set out in this Section 10.1;

 

(c)        any government, agency or regulatory authority having jurisdiction over a Party, to the extent legally required, and then only after, to the extent permitted by law, informing the other Parties thereof and, to the extent possible, with sufficient notice in advance to permit the other Parties to seek a protective order or other remedy;

 

(d)        any Person to the extent required by any Applicable Laws, judicial process or the rules and regulations of any recognized stock exchange and then only subject to prior consultation with the other Parties;

 

(e)        in the case of XNDA, any intended assignee of the rights and interests of a Party or to a Person intending to acquire an interest in a party to this Agreement (or acquiring XNDA or an affiliate of XNDA) as long as the intended assignee or acquirer in turn is required by that Party to treat the Confidential Information as confidential in favor of the other parties on terms substantially restrictive as those set out in this Section 10.1; or

 

(f)        the extent that the Confidential Information is in or lawfully comes into the public domain other than by breach of this Section 10.1.

 

 

ARTICLE 11

MISCELLANEOUS

 

11.1        Expenses. Each Party shall pay its own expenses in connection with the negotiation, preparation and performance of this Agreement and the consummation of the transactions, including all fees and expenses of investment bankers, financial advisors, legal counsel, and independent accountants.

 

11.2        Notices. Any notice, consent, waiver, direction or other communication required or permitted to be given under this Agreement by a Party shall be in writing and may be given by sending same by facsimile, email or by delivery by hand addressed to the Party to which the notice is to be given at the applicable address noted below. Any such notice, consent, waiver, direction or other communication, if sent by facsimile or email, shall be deemed to have been given and received at the time of receipt (if a Business Day or, if not, the next succeeding Business Day) unless actually received after 4:00 p.m. (local time) at the point of delivery in which case it shall be deemed to have been received on the next succeeding Business Day; or, if delivered by hand, shall be deemed to have been received on the day on which it is delivered (if a Business Day, if not, the next succeeding Business Day). Notice of change of address shall also be governed by this Section 10.2. In the event of general discontinuance of postal service due to strike, lock-out or otherwise, notices, consents, waivers, directions or other communications shall be given by facsimile or email or by delivery by hand and shall be deemed to have been received in accordance with this Section 10.2.

 

The address for each of the parties shall be as follows:

 

(a)  If to XNDA, addressed to:
25108 Marguerite Pkwy, Ste A 450
Mission Viejo, CA 92692

 

(b)  If to TribalRides or the Shareholders, addressed to:

Tribal Rides, Inc

25108 Marguerite Pkwy, Ste A 450

Mission Viejo, CA 92692

 

 

 

 

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11.3        Press Releases and Public Announcements. No Party shall issue or otherwise disseminate any press release or other public notice related to this Agreement, the Transaction Documents or any of the transactions contemplated hereby without the prior written consent of the other Parties. Notwithstanding the foregoing, XNDA or XNDA shall be permitted to issue any press release or other public notice related to this Agreement, the Transaction Documents or any of the transactions contemplated hereby, without the consent of any other Party if such release is required by a Governmental Authority, a recognized securities exchange on which its securities are or may be listed or any Applicable Law.

 

11.4        Arbitration.

 

(a)              All disputes, controversies or claims arising out of, relating to, or in respect of this Agreement, including any issue regarding its existence, validity, enforceability, interpretation, breach or termination (each a "Dispute") shall be resolved in accordance with the terms of this Agreement.

 

(b)              Any Dispute that XNDA, the Shareholders or TribalRides are unable to amicably resolve or settle between themselves through negotiations between senior executives of the relevant Party within fifteen (15) Business Days (or such longer period as the applicable parties may agree to in writing) of a party being provided notice of such Dispute or difference in accordance with Section 11.2 of this Agreement (the "Consultation Period") shall be referred to and finally determined by final and binding arbitration. The arbitration shall be confidential and shall be settled in accordance with the terms of this Agreement (the "Arbitrator").

 

(c)              The arbitration shall be governed by the Rules of the American Arbitration Association to the extent that such rules do not conflict with the terms of this Section 11.4.

 

(d)                The arbitration shall be seated in the City of Los Angeles, California and the arbitration agreement set forth in this Agreement shall be governed by and construed in accordance with the laws of California. The language of the arbitration shall be English.

 

(e)                 Within thirty (30) days of the expiry of the Consultation Period, the disputing parties agree to jointly select the Arbitrator who shall be trained in the laws of California. The Arbitrator shall be impartial and independent of the Parties and shall be experienced and knowledgeable about the subject matter of the Dispute (generally and not as to the express facts concerning the Dispute). If the disputing Parties are unable to agree upon the Arbitrator, any such disputing Parties may apply to elect an Arbitrator in accordance with the provisions of the Rules of the American Arbitration Association.

 

(f)                  It is specifically acknowledged and agreed that any Dispute that cannot be resolved between the disputing Parties prior the expiry of the Consultation Period shall be submitted to arbitration irrespective of the magnitude thereof or the amount in question.

 

(g)                The Arbitrator shall have jurisdiction: (i) to apply all applicable statutes, regulations, common law and equity; and (ii) to make an award or awards in respect of interest and the payment of the costs of the arbitration (including arbitrators' fees and the legal costs of the Parties). The Arbitrator also may, where requested by a Party, determine the nature and extent of production of documents and oral depositions.

 

(h)                The award of the Arbitrator shall be reduced to writing and be final and binding on the disputing Parties. Any monetary award shall be made and payable, free of any taxes or other deduction, and shall bear interest from the date of any breach or other violation of this Agreement to the date on which the award is paid, at a rate determined by the Arbitrator.

 

(i)                  Judgment upon the award(s) rendered by the Arbitrator may be entered and execution had in any court of competent jurisdiction, or application may be made to such court for a judicial acceptance of the award and order of enforcement.

 

(j)                  The Party against whom judgment is rendered shall bear all legal fees of the disputing Parties and all other costs incurred in connection with an arbitration proceeding, including the expenses of the Arbitrator.

 

 

 

 

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(k)                By agreeing to arbitration, the Parties do not intend to deprive any court of its jurisdiction to issue a pre-arbitral injunction, pre-arbitral attachment or other order in aid of the arbitration proceedings and the enforcement of any award. Without prejudice to such provisional remedies in aid of arbitration as may be available under the jurisdiction of a legal court, the Arbitrator shall have full authority to grant provisional remedies, statutory remedies and to award damages for the failure of the disputing parties to respect the Arbitrator's orders to that effect.

 

(l)                  Nothing in this Agreement shall restrict or prohibit a Party from commencing arbitration at any time, including prior the expiry of a Consultation Period, in order to protect its rights under this Agreement or in relation to a dispute or disagreement.

 

(m)               Except where reasonably prevented by the nature of the Dispute, XNDA, the Shareholders and TribalRides shall continue to perform their respective duties, obligations and responsibilities under this Agreement and the Transaction Documents while the Dispute is being resolved in accordance with this Section 10.4, unless and until such obligations are lawfully terminated or expire in accordance with the provisions thereof.

 

(n)                All dispute resolution and arbitration proceedings (including all related information, communications, documents, materials, and evidence) shall be strictly confidential, and each party shall have a fiduciary obligation to the other parties to protect, preserve and maintain the integrity of such confidentiality.

 

11.5        Assignments, Successors and No Third-Party Rights. TribalRides shall not assign any of its rights or obligations under this Agreement without the prior written consent of XNDA. XNDA may assign any of its rights, but not its obligations, under this Agreement without the consent of TribalRides to an affiliate of XNDA or to a purchaser of all of the Assets or outstanding securities of XNDA. If XNDA shall experience a change of control, or if it shall sell to a purchaser substantially all of its assets or greater than fifty-percent (50%) of its equity, such purchaser shall consent to all terms in this Agreement, specifically the issuance of the shares representing the Purchase Price. Subject to the preceding three sentences, this Agreement will apply to, be binding in all respects upon and inure to the benefit of the successors and permitted assigns of the Parties. Except as expressly set forth in this Agreement, no Person other than the Parties hereto has any legal or equitable right, remedy or claim under or with respect to this Agreement or any provision of this Agreement.

 

11.6        Enurement. This Agreement shall enure to the benefit of and be binding upon the Parties hereto and their respective successors and permitted assigns.

 

 

 

 

 

 

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11.7        Counterparts. This Agreement may be executed in one or more counterparts, each of which will be deemed to be an original and all of which together will be deemed to be one and the same instrument, and will become voluntarily.

 

The duly authorized representatives of each party executed this Purchase Agreement on the date set out in the preamble.

 

11.8        Independent Legal Advice. Each of the Parties acknowledges that they: (a) have been advised by the other Parties to seek independent legal advice; (b) have sought such independent legal advice or deliberately decided not to do so; (c) understand their rights and obligations under this Agreement; and (d) are executing this Agreement.

 

The duly authorized representatives of each party executed this Purchase Agreement on the date set out in the preamble.

 

 

XINDA INTERNATIONAL CORP.

 

 

By: /s/ Joe Grimes___________________

Name: Joe Grimes___________________

Title: CEO_________________________

 

 

 

TRIBALRIDE COMPANY INC.

 

 

By: /s/ Joe Grimes___________________

Name: Joe Grimes___________________

Title: CEO_________________________

 

 

 

THE SHAREHOLDERS

 

 

By: /s/ Joe Grimes____________________

Name: Joe Grimes____________________

Title: ______________________________

 

 

 

 

 

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EXHIBIT A PURCHASED ASSETS

 

1) Patents

a.      Approved

b.      2 Applications

c.       3 Negotiations for Existing Map Patents

2) University Contacts

a.      University of Nevada Reno

3) 5 year Business plans

4) Financial Forecasts

5) Phase 1 Development plans

6) Copyright

a.      Gotopia (software name), Smart Deployment (Algorithms), Tribal Rides (Company)

7) URLS:

TribalRides.us, Tribalrides.mobi, gotopia.io, gotopia.mobi, autopass.io, autopia.io, effective when one or more counterparts have been signed by each of the parties. Delivery of an executed counterpart of a signature page of this Agreement by .pdf attachment to a transmission by electronic mail or by facsimile transmission shall each be effective as delivery of a manually executed original counterpart hereof.

8) Small Business Innovative Research proposals – to be submitted to the National Technical Team

9) Possible Take-over candidates

10) Taxi Company software

 

 

 

 

 

 

 

 

 

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Exhibit 10.2

 

THE SECURITY REPRESENTED BY THIS CERTIFICATE HAS BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF. NO SUCH SALE OR DISPOSITION MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED UNDER THE SECURITIES ACT OF 1933, AS AMENDED.

 

 

STOCK OPTION AGREEMENT

 

 

THIS STOCK OPTION AGREEMENT ("Agreement") is made effective as of the date of grant set forth below ("Date of Grant") by and between XINDA, INTERNATIONAL, INC., a Colorado corporation ("Company"), and the optionee named below ("Optionee") as contemplated in the Company's 2020 Option Plan ("Plan"). Capitalized terms not defined herein shall have the meaning ascribed to them in the Plan.

 

Optionee:                     Joseph Grimes

 

Social Security Number:                 xxx-xx-xxxx

 

Address:        28235 Shore, Mission Viejo, CA 92692

 

Total Option Shares:          100,000

 

Exercise Price Per Share:             Par Value $0.01

 

Date of Grant:           June 20, 2020

 

First Vesting Date:             December 20,2021

 

Expiration Date for Exercise of Options:           June 20, 2025

 

Stock Option Number: TBD

 

Type of Stock Option:

(Check one)                   [ X] Incentive Stock Option              [ ] Statutory Stock Option

 

 

 

 

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1.              Conditional Grant of Option. The Company hereby conditionally grants to Optionee an option (“Option”) to purchase the total number of shares of Common Stock of the Company set forth above ("Shares") at the Exercise Price Per Share set forth above ("Exercise Price"), subject to all of the terms and conditions of this Agreement and the Plan. If designated as an Incentive Stock Option above, the Option is intended to qualify as an "incentive stock option" (“ISO”) within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended (“Code”). Subject to the Plan, only Directors of the Company shall receive ISOs. This Agreement shall be deemed a Stock Option Agreement as defined in the Plan. The terms and conditions of the Plan are incorporated herein by this reference. All specific terms and references, including capitalized terms and references, which are undefined in this Agreement, shall have the definition and meaning ascribed to them in the Plan, including, without limitation, the definition of the terms Director and Consultant.

 

2.              Exercise Price. The Exercise Price, is not less than the fair market value per share of Common Stock on the date of grant, as determined by the Board; provided, however, in the event Optionee is a Director and owns stock representing more than ten percent (10%) of the total combined voting power of all classes of stock of the Company or of its Parent or Subsidiary corporations immediately before the Option is granted, said exercise price is not less than one hundred ten percent (110%) of the fair market value per share of Common Stock on the date of grant as determined by the Board.

 

3.              Exercise of Option. Subject to the vesting schedule contained herein and the other conditions set forth in this Agreement, all or part of the Option may be exercised prior to its expiration from the first vesting date set forth above ("First Vesting Date") up to and including 5:00 p.m. Pacific Standard Time on the expiration date set forth above ("Expiration Date") at the time or times set forth herein in accordance with the provisions of the Plan as follows:

 

(i) Vesting:

 

(a) The Option shall become exercisable in the amount of 33,334 shares upon the First Vesting Date. Thereafter, unless all options have vested subject to other terms of this Agreement, the Option shall vest and become exercisable, so long as Optionee continues to be retained by Company, at the rate of 33,333 Shares upon each anniversary of the First Vesting Date.

 

(b) In the event of a sale or merger of all or substantially all of the Company's assets to an acquiring party following which the Company would not be a surviving operating entity, the Company will provide Optionee a fifteen (15) day prior notice of such proposed event providing for immediate vesting of all remaining unvested Options under this Agreement.

 

(c) This Option may not be exercised for a fraction of a Share.

 

(d) In the event of Optionee's death, disability or other termination of employment, the exercisability of the Option is governed by Sections 7, 8 and 9 below, subject to the limitations contained in subsection 3(i)(d) below.
     
(e) In no event may the Option be exercised after the date of expiration of the term of the Option as set forth in Section 11 below.

 

 

 

 

 

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(ii) Method of Exercise. The Option shall be exercisable by written notice which shall state the election to exercise the Option, the nwnber of Shares in respect of which the Option is being exercised, and such other representations and agreements as to the holder's investment intent with respect to such shares of Common Stock as may be required by the Company pursuant to the provisions of the Plan. Such written notice shall be signed by Optionee and shall be delivered in person or by certified mail to the President, Secretary or Chief Financial Officer of the Company. The written notice shall be accompanied by payment of the exercise price.
     
  (ii)(ii) Method of Exercise. The Option shall be exercisable by written notice which shall state the election to exercise the Option, the number of Shares in respect of which the Option is being exercised, and such other representations and agreements as to the holder's investment intent with respect to such shares of Common Stock as may be required by the Company pursuant to the provisions of the Plan. Such written notice shall be signed by Optionee and shall be delivered in person or by certified mail to the President, Secretary or Chief Financial Officer of the Company. The written notice shall be accompanied by payment of the exercise price.
     
(iii) Compliance with Law. No Shares will be issued pursuant to the exercise of an Option unless such issuance and such exercise shall comply with all relevant provisions of law and the requirements of any stock exchange or quotation medium upon which the Shares may then be listed or quoted. Assuming such compliance, for income tax purposes the Shares shall be considered transferred to the Optionee on the date on which the Option is exercised with respect to such Shares.

 

(iv) Adjustments, Merger, etc. The number and class of the Shares and/or the exercise price specified above are subject to appropriate adjustment in the event of changes in the capital stock of the Company by reason of stock dividends, stock splits, combination or recombination of shares, reclassifications, mergers, consolidations, reorganizations or liquidations. Subject to any required action of the stockholders of the Company, if the Company shall be the surviving corporation in any merger or consolidation, the Option (to the extent that it is still outstanding) shall pertain to and apply to the securities to which a holder of the same number of shares of Common Stock that are then subject to the Option would have been entitled. A dissolution or liquidation of the Company, or a merger or consolidation in which the Company is not the surviving corporation, will cause the Option to terminate, unless such dissolution or liquidation of the Company, or a merger or consolidation shall otherwise provide. Prior to the termination of the Option the Company shall provide Optionee a notice of the intent to terminate the Option fifteen days prior to a dissolution or liquidation of the Company, or a merger or consolidation in which the Company is not the surviving corporation, and Optionee shall have the right under such notice to exercise this Option in whole or part (to the extent that the Option is still outstanding) during a ten-day period ending on the fifth day prior to such dissolution or liquidation of the Company, or a merger or consolidation. To the extent that the foregoing adjustments relate to stock or securities of the Company, such adjustments shall be made by the Board, whose determination in that respect shall be final, binding and conclusive.

 

 

 

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4.              Optionee's Representations. By receipt of the Option, by its execution, and by its exercise in whole or in part, Optionee represents to the Company that Optionee understands that:

 

(i) Both the Option and any Shares purchased upon its exercise are securities, the issuance by the Company of which requires compliance with federal and state securities laws;

 

(ii) These securities are made available to Optionee only on the condition that Optionee makes the representations contained in this Section 4 to the Company;

 

(iii) Optionee has made a reasonable investigation of the affairs of the Company sufficient to be well informed as to the rights and the value of these securities;

 

(iv) Optionee understands that the securities have not been registered under the Securities Act of 1933, as amended (the 11Act") in reliance upon one or more specific exemptions contained in the Act, which may include reliance on Rule 701 promulgated under the Act, if available, or which may depend upon: (a) Optionee's bona fide investment intention in acquiring these securities; (b) Optionee's intention to hold these securities in compliance with federal and state securities laws; (c) Optionee having no present intention of selling or transferring any part thereof (recognizing that the Option is not transferable) in violation of applicable federal and state securities laws; and (d) there being certain restrictions on transfer of the Shares subject to the Option;

 

(v) Optionee understands that the Shares subject to the Option, in addition to other restrictions on transfer, must be held indefinitely unless subsequently registered under the Act, or unless an exemption from registration is available; that Rule 144, the usual exemption from registration, is only available after the satisfaction of certain holding periods and in the presence of a public market for the Shares; that there is no certainty that a public market for the Shares will exist, and that otherwise it will be necessary that the Shares be sold pursuant to another exemption from registration which may be difficult to satisfy; and,

 

(vi) Optionee understands that the certificate representing the Shares will bear a legend prohibiting their transfer in the absence of their registration or the opinion of counsel for the Company that registration is not required, and a legend prohibiting their transfer in compliance with applicable state securities laws unless otherwise exempted.

 

 

 

 

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5.              Method of Payment. Payment of the purchase price may be made subject to the terms of Section 14 herein, or by cash, check or, in the sole discretion of the Board at the time of exercise, promissory notes or other Shares of Common Stock having a fair market value on the date of surrender equal to the aggregate purchase price of the Shares being purchased.

 

6.              Restrictions on Exercise. The Option may not be exercised if the issuance of such Shares upon such exercise or the method of payment of consideration for such Shares would constitute a violation of any applicable federal or state securities or other law or regulation. As a condition to the exercise of the Option, the Company may require Optionee to make any representation and warranty to the Company as may be required by any applicable law or regulation.

 

7.              Termination of Status as a Director. In the event of termination of Optionee's continuous status as a Director, as such status may be determined and construed by the Company in its sole discretion ("Continuous Status"), for any reason other than death or disability or the completed term and performance under any consulting or employment agreement between the Optionee and the Company, Optionee may, but only within sixty (60) days after the date of such termination (but in no event later than the date of expiration of the term of the Option as set forth in Section 11 below), exercise the Option to the extent that Optionee was entitled to exercise it at the date of such termination. To the extent that Optionee was not entitled to exercise the Option at the date of such termination, or if Optionee does not exercise the Option within the time specified herein, the Option shall terminate.

 

8.             Disability of Optionee. In the event of termination of Optionee's Continuous Status as an Director as a result of Optionee's disability, Optionee may, but only within six (6) months from the date of termination of employment or consulting relationship (but in no event later than the date of expiration of the term of the Option as set forth in Section 11 below), exercise the Option to the extent Optionee was entitled to exercise it at the date of such termination; provided, however that if the disability is not total and permanent (as defined in Section 22(e)(3) of the Code) and the Optionee exercises the option within the period provided above but more than three months after the date of termination, the Option shall automatically be deemed to be a Nonstatutory Stock Option and not an Incentive Stock Option; and provided, further, that if the disability is total and permanent (as defined in Section 22(e)(3) of the Code), then the Optionee may, but only within one (1) year from the date of termination of employment or consulting relationship (but in no event later than the date of expiration of the term of the Option as set forth in Section 11 below), exercise the Option to the extent Optionee was entitled to exercise it at the date of such termination. To the extent that Optionee was not entitled to exercise the Option at the date of termination, or if Optionee does not exercise such Option (which Optionee was entitled to exercise) within the time periods specified herein, the Option shall terminate.

 

9.             Death of Optionee. In the event of the death of Optionee:

 

(i) During the term of the Option while an Director of the Company and having been in Continuous Status as an Director since the date of grant of the Option, the Option may be exercised, at any time within one (1) year following the date of death (but, in the case of an Incentive Stock Option, in no event later than the date of expiration of the term of the Option as set forth in Section 11 below), by Optionee's estate or by a person who acquired the right to exercise the Option by bequest or inheritance, but only to the extent of the right to exercise that had accrued at the time of death of the Optionee. To the extent that such Director was not entitled to exercise the Option at the date of death, or if such Director, Consultant, estate or other person does not exercise such Option (which such Director, Consultant, estate or person was entitled to exercise) within the one (1) year time period specified herein, the Option shall terminate; or,

 

 

 

 

  5  
 

 

(ii) During the sixty (60) day period specified in Section 7 or the one (1) year period specified in Section 8, after the termination of Optionee's Continuous Status as an Director, the Option may be exercised, at any time within one (1) year following the date of death (but, in the case of an Incentive Stock Option, in no event later than the date of expiration of the term of the Option as set forth in Section 11 below), by Optionee's estate or by a person who acquired the right to exercise the Option by bequest or inheritance, but only to the extent of the right to exercise that had accrued at the date of termination. To the extent that such Director was not entitled to exercise the Option at the date of death, or if such Director, Consultant, estate or other person does not exercise such Option (which such Director, Consultant, estate or person was entitled to exercise) within the one (1) year time period specified herein, the Option shall terminate.

 

10.            Non-Transferability of Option. The Option may not be transferred in any manner otherwise than by wil1 or by the laws of descent or distribution and may be exercised during the lifetime of Optionee, only by Optionee. The terms of the Option shall be binding upon the executors, administrators, heirs, successors and assigns of Optionee.

 

11.            Term of Option. The Option may not be exercised more than five (5) years from the date of grant of the Option, and may be exercised during such term only in accordance with the Plan and terms of the Option; provided, however, that the term of this option, if it is a Nonstatutory Stock Option, may be extended for the period set forth in Section 9(i) or Section 9(ii) in the circumstances set forth in such Sections.

 

12.           Early Disposition of Stock; Taxation Upon Exercise of Option. If Optionee is an Director and the Option qualifies as an ISO, Optionee understands that, if Optionee disposes of any Shares received under the Option within two (2) years after the date of this Agreement or within one (1) year after such Shares were transferred to Optionee, Optionee may be treated for federal income tax purposes as having received ordinary income at the time of such disposition in any amount generally measured as the difference between the price paid for the Shares and the lower of the fair market value of the Shares at the date of exercise or the fair market value of the Shares at the of disposition. Any gain recognized on such premature sale of the Shares in excess of the amount treated as ordinary income may be characterized as capital gain. Optionee hereby agrees to notify the Company in writing within thirty (30) days after the date of any such disposition. Optionee understands that if Optionee disposes of such Shares at any time after the expiration of such two year and one-year holding periods, any gain on such sale may be treated as long-term capital gain laws subject to meeting various qualifications. If Optionee is a Consultant or this is a Nonstatutory Stock Option, Optionee understands that, upon exercise of the Option, Optionee may recognize income for tax purposes in an amount equal to the excess of the then fair market value of the Shares over the exercise price. Upon a resale of such shares by the Optionee, any difference between the sale price and the fair market value of the Shares on the date of exercise of the Option may be treated as capital gain or loss. Optionee understands that the Company may be required to withhold tax from Optionee's current compensation in some of the circumstances described above (and Optionee hereby so authorizes the Company); to the extent that Optionee's current compensation is insufficient to satisfy the withholding tax liability, the Company may require the Optionee to make a cash payment to cover such liability as a condition to exercise of the Option.

 

 

 

 

  6  
 

 

13.            Tax Consequences. The Optionee understands that any of the foregoing references to taxation are based on federal income tax laws and regulations now in effect, and may not be applicable to the Optionee under certain circumstances. The Optionee may also have adverse tax consequences under state or local law. The Optionee has reviewed with the Optionee's own tax advisors the federal, state, local and foreign tax consequences of the transactions contemplated by this Agreement. The Optionee is relying solely on such advisors and not on any statements or representations of the Company or any of its agents. The Optionee understands that the Optionee (and not the Company) shall be responsible for the Optionee's own tax liability that may arise as a result of the transactions contemplated by this Agreement.

 

14.            Net Issue Exercise. Notwithstanding any provisions herein to the contrary, if the fair market value of one share of the Company's Common Stock is greater than the Per Share Exercise Price (at the date of calculation as set forth below), in lieu of exercising the Option for cash, the Optionee may elect to receive shares equal to the value (as determined below) of the Option (or the portion thereof being canceled) by surrender of the Option at the principal office of the Company together with the properly endorsed Notice of Exercise and Subscription Form and notice of such election, in which event the Company will issue to the Optionee a number of shares of Common Stock computed using the following formula:

 

 

X =Y (A-B)

A

 

Where X = the number of shares of Common Stock to be issued to the Optionee

 

Y = the number of shares of Common Stock purchasable under the Option or, if only a portion of the Option is being exercised, the portion of the Option being canceled (at the date of such calculation)

 

A= the fair market value of one share of the Company's Common Stock (at the date of such calculation)

 

B = Per Share Exercise Price (as adjusted to the date of such calculation)

 

For purposes of the above calculation, fair market value of one share of the Company's Stock will be the average of the closing prices of the Company's shares of Common Stock as quoted on the OTC Bulletin Board (the ''OTCBB") (or on such other United States stock exchange or public trading market or quotation medium on or by which the shares of the Company trade or are quoted if, at the time of the election, they are not trading or being quoted on the OTCBB), for the five (5} consecutive trading days immediately preceding the date of the date the completed, executed Notice of Exercise and Subscription Form is received.

 

 

 

 

 

 

  7  
 

 

15.            Damages. The parties agree that any violation of the Option (other than a default in the payment of money) cannot be compensated for by damages, and any aggrieved party shall have the right, and is hereby granted the privilege, of obtaining specific performance of the Option in any court of competent jurisdiction in the event of any breach hereunder.

 

16.            Delay. No delay or failure on the part of the Company or the Optionee in the exercise of any right, power or remedy shall operate as a waiver thereof, nor shall any single or partial exercise by any of them of any right, power or remedy preclude other or further exercise thereof, or the exercise of any other right, power or remedy.

 

17.            Restrictions. Notwithstanding anything herein to the contrary, Optionee understands and agrees that Optionee shall not dispose of any of the Shares, whether by sale, exchange, assignment, transfer, gift, devise, bequest, mortgage, pledge, encumbrance or otherwise, except in accordance with the terms and conditions of this Agreement, and Optionee shall not take or omit any action which will impair the absolute and unrestricted right, power, authority and capacity of Optionee to sell Shares in accordance with the terms and conditions hereof.

 

Any purported transfer of Shares by Optionee that violates any provision of this Section 17 shall be wholly void and ineffectual and shall give to the Company or its designee the right to purchase from Optionee all but not less than all of the Shares then owned by Optionee for a period of ninety (90) days from the date the Company first learns of the purported transfer at the Agreement Price and on the Agreement Terms (as those terms are defined in subsections (iv) and (v), respectively, of this Section 17).

 

The Company shall not cause or permit the transfer of any Shares to be made on its books except in accordance with the terms hereof.

 

(i) Permitted Transfers.

 

(a) Optionee may sell, assign or transfer any Shares held by the Optionee but only by complying with the provisions of this Section I 7.

 

(b) Upon the death of Optionee, Shares held by the Optionee may be transferred to the personal representative of the Optionee's estate. Shares so transferred shall be subject to the provisions of the Option and this Agreement.

  

(ii) Stock Certificate Legend. Each stock certificate for Shares issued to the Optionee shall have conspicuously written, printed, typed or stamped upon the face thereof, or upon the reverse thereof with a conspicuous reference on the face thereof, one or both of the following legends:

 

 

 

 

 

  8  
 

 

THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ISSUED WITHOUT REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE TRANSFERRED IN THE ABSENCE OF REGISTRATION THEREUNDER OR AN APPLICABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF SUCH ACT. SUCH SHARES MAY NOT BE SOLD, ASSIGNED, TRANSFERRED, OR OTHERWISE DISPOSED OF IN ANY MANNER EXCEPT IN ACCORDANCE WITH AND SUBJECT TO THE TERMS OF THE STOCK OPTION AGREEMENT, A COPY OF WHICH IS ON FILE AT THE PRINCIPAL OFFICE OF THE COMPANY. EVERY CREDITOR OF THE HOLDER HEREOF AND ANY PERSON ACQUIRING OR PURPORTING TO ACQUIRE THIS CERTIFICATE OR THE SHARES HEREBY EVIDENCED OR ANY INTEREST THEREIN IS HEREBY NOTIFIED OF THE EXISTENCE OF SUCH STOCK OPTION AGREEMENT, AND ANY ACQUISITION OR PURPORTED ACQUISITION OF THIS CERTIFICATE OR THE SHARES HEREBY EVIDENCED OR ANY INTEREST THEREIN SHALL BE SUBJECT TO ALL RIGHTS AND OBLIGATIONS OF THE PARTIES TO SUCH STOCK OPTION AGREEMENT AS THEREIN SET FORTH.

 

IT IS UNLAWFUL TO CONSUMMATE A SALE OR TRANSFER OF THIS SECURITY, OR ANY INTEREST THEREIN, OR TO RECEIVE ANY CONSIDERATION THEREFOR, WITHOUT THE PRIOR WRITTEN CONSENT OF THE COMMISSIONER OF CORPORATIONS OF THE STATE OF CALIFORNIA, EXCEPT AS PERMITTED IN THE COMMISSIONER'S RULES.

 

(iii) Manner of Exercise. Any right to purchase hereunder shall be exercised by giving written notice of election to the Optionee, the Optionee's personal representative or any other selling person, as the case may be, prior to the expiration of such right to purchase.

 

(iv) Agreement Price. The "Agreement Price" shall be the higher of (a) the fair market value of the Shares to be purchased determined in good faith by the Board of Directors of the Company and (b) the original exercise price of the Shares to be purchased.

 

(v) Agreement Terms. "Agreement Terms" shall mean and include the following:

 

(a) Delivery of Shares and Closing Date. At the closing, the Optionee, the Optionee's personal representative or such other selling person, as the case may be, shall deliver certificates representing the Shares, properly endorsed for transfer, and with the necessary documentary and transfer tax stamps, if any, affixed, to the purchaser of such Shares. Payment of the purchase price therefore shall concurrently be made to the Optionee, the Optionee's personal representative or such other selling person, as provided in subsection (b) of this subsection (v). Such delivery and payment shall be made at the principal office of the Company or at such other place as the parties mutually agree.

 

 

 

 

 

  9  
 

 

(b) Payment of Purchase Price. The Company shall pay the purchase price to the Optionee at the closing.

 

(vi) Right to Purchase Upon Certain Events. The Company or its designee shall have the right to purchase all, but not less than all, of the Shares held by the Optionee at the Agreement Price and on the Agreement Terms for a period of ninety (90) days after any of the following events:

 

(a) An attempt by a creditor to levy upon or sell any of the Optionee's Shares;

 

(b) The filing of a petition by the Optionee under the U.S. Bankruptcy Code or any insolvency laws;

 

(c) The filing of a petition against Optionee under any insolvency or bankruptcy laws by any creditor of the Optionee if such petition is not dismissed within thirty (30) days of filing;

 

(d) The entry of a decree of divorce between the Optionee and the Optionee's spouse; or,

 

(e) The termination of Optionee's services as an Director with the Company.

 

The Optionee shall provide the Company written notice of the occurrence of any such event within 30 days of such event.

 

(vii) Termination. The provisions of this Section 17 shall terminate and all rights of each such party hereunder shall cease except for those which shall have theretofore accrued upon the occurrence of any of the following events:

 

(a) Cessation of the Company's business;

 

(b) Bankruptcy, receivership or dissolution of the Company;

 

 

(c) Written consent or agreement of the shareholders of the Company holding Fifty Percent (50%) of the then issued and outstanding shares of the Company (determined on a fully diluted basis);

 

(d) Consent or agreement of a majority of the members of the Board of Directors of the Company; or,

 

 

 

 

 

  10  
 

 

(e) Registration of any class of equity securities of the Company pursuant to Section 12 of the Securities Exchange Act of 1934, as amended.

 

(viii) Amendment. This Section 17 may be modified or amended in whole or in part by a written instrument signed by shareholders of the Company holding 50% of the outstanding shares of Common Stock (determined on a fully diluted basis) or a majority of the members of the Board of Directors of the Company.

  

18.           Market Standoff. Unless the Board of Directors otherwise consents, Optionee agrees hereby not to sell or otherwise transfer any Shares or other securities of the Company during the 180-day period following the effective date of a registration statement of the Company filed under the Act; provided, however, that such restriction shall apply only to the first two registration statements of the Company to become effective under the Act which includes securities to be sold on behalf of the Company to the public in an underwritten public offering under the Act. The Company may impose stop-transfer instructions with respect to securities subject to the foregoing restrictions until the end of such 180-day period.

 

19.             Rule 144. Optionee acknowledges and understands that the Shares may be subject to transfer and sale restrictions imposed pursuant to SEC Rule 144 of the Rules promulgated under the Securities Act of 1933 ("Act") and the regulations promulgated thereunder. Optionee shall comply with Rule 144 and with all policies and procedures established by the Company with regard to Rule 144 matters. Optionee acknowledged that the Company or its attorneys or transfer agent may require a restrictive legend on the certificate or certificates representing the Shares pursuant to the restrictions on transfer of the Shares imposed by Rule 144.

 

20.            No Distribution. Notwithstanding anything in this Agreement to the contrary, Optionee acknowledges that: (i) the Option, and the Shares upon exercise, is and are being acquired in a private transaction which is not part of a distribution of the Option or Shares; (ii) the Optionee intends to hold the Option and Shares for the account of the Optionee and does not intend to sell the Option or Shares as a part of a distribution or otherwise; and (iii) neither the Optionee nor the Company is an underwriter with regard to the Option or the Shares for purposes of Rule 144.

 

21.            Securities Compliance. Optionee understands that the Option and the Shares may be offered and sold in reliance on one or more exemptions from the registration requirements of federal and state securities laws, which exemptions may include, without limitation, Regulation D promulgated under the Securities Act, and that the Company is relying upon the truth and accuracy of the representations, warranties, agreements, acknowledgments and understandings of Optionee set forth herein in order to determine the applicability of such exemptions and the suitability of Optionee to acquire the Option and the Shares. The representations, warranties and agreements contained herein are true and correct as of the date hereof and may be relied upon by the Company and Optionee will notify the Company immediately of any adverse change in any such representations and warranties which may occur prior to the issuance of Shares. The representations, warranties and agreements of Optionee contained herein shall survive the execution and delivery of this Agreement and the exercise of the Option and the issuance of the Shares.

 

 

 

 

 

  11  
 

 

 

22.           Complete Agreement. This Agreement constitutes the entire agreement between the parties with respect to its subject matter, and supersedes all other prior or contemporaneous agreements and understandings both oral or written; subject, however, that in the event of any conflict between this Agreement and the Plan, the Plan shall govern. This Agreement may only be amended in a writing signed by the Company and the Optionee.

 

23.            Privileges of Stock Ownership. Optionee shall not have any of the rights of a shareholder with respect to any Shares until Optionee exercises the Option and pays the Exercise Price, Shares are issued and delivered to Optionee, and Optionee is shown as a shareholder of record on the books and records of the Company.

 

24.            Further Acts. The parties hereto shall cooperate with each other and execute such additional documents or instruments and perform such further acts as may be reasonably necessary to affect the purpose and intent of the Agreement.

 

25.            Effect of Headings. The subject headings of the paragraphs and subparagraphs of this Agreement are included for purposes of convenience only, and shall not affect the construction or interpretation of any of its provisions.

 

26.            Notices. Any notice required to be given or delivered to the Company under the terms of this Agreement shall be in writing and addressed to the Corporate Secretary of the Company at its principal corporate offices. Any notice required to be given or delivered to Optionee shall be in writing and addressed to Optionee at the address indicated herein or to such other address as such party may designate in writing from time to time to the Company. All notices shall be deemed to have been given or delivered upon actual personal delivery; three (3) days after deposit in the United States mail by certified or registered mail (return receipt requested); one (1) business day after deposit with any return receipt express courier (prepaid); or one (1) business day after transmission by facsimile with a corresponding facsimile transmission confirmation sheet.

 

27.            Counterparts. This Agreement may be executed simultaneously in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. The exhibits attached hereto and initialed by the parties are made a part hereof and incorporated herein by this reference.

 

28.            Parties in Interest. Nothing in this Agreement, whether express or implied, is intended to confer any rights or remedies under or by reason of this Agreement on any persons other than the parties to it and their respective successors and assigns, nor is anything in this Agreement intended to relieve or discharge the obligation or liability of any third party to this Agreement, nor shall any provision give any third person any right of subrogation or action over against any party to this Agreement.

 

29.            Recovery of Litigation Costs. If any legal action or any arbitration or other proceeding is brought for the enforcement of this Agreement, or because of an alleged dispute, breach, default or misrepresentation in connection with any of the provisions of this Agreement, the successful or prevailing party or parties shall be entitled to recover as an element of their damages, reasonable attorneys' fees and other costs incurred in that action or proceeding, in addition to any other relief to which they may be entitled.

 

 

 

 

 

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30.            Severability; Construction. In the event that any provision in this Agreement shall be invalid or unenforceable, such provision shall be severable from, and such invalidity or unenforceability shall not be construed to have any effect on, the remaining provisions of this Agreement. This Agreement shall be construed as to its fair meaning and not for or against either party.

 

31.            Survival of Representations and Obligations. All representations, warranties and agreements of the parties contained in this Agreement, or in any instrument, certificate, opinion or other writing provided for in it, shall survive the exercise of the Option and the issuance of the Shares.

 

32.            Specific Performance. Each party's obligations under this Agreement are unique. If any party should default in its obligations under this Agreement, the parties each acknowledge that it would be extremely impracticable to measure the resulting damages; accordingly, the nondefaulting party, in addition to any other available rights or remedies, may sue in equity for specific performance without the necessity of posting a bond or other security, and the parties each expressly waive the defense that a remedy in damages will be adequate.

 

33.            Gender; Number. Whenever the context of this Agreement requires, the masculine gender includes the feminine or neuter gender, and the singular number includes the plural.

 

34.            Governing Law and Venue. This Agreement will be construed and enforced in accordance with, and the rights of the parties will be governed by, the laws of the State of California without regard to conflict of laws principles. Venue in any action arising by reason of this Agreement shall lie exclusively in Orange County, California.

 

35.           Employment Agreement. This Option is issued pursuant to that certain Director's Agreement effective June 20,2020, and any amendments thereto, between the Optionee and the Company. The terms of the Director's Agreement shall control over any conflicting terms in this Option. Any breach under the Director's Agreement shall constitute a breach under this Option and allows the Company to terminate this Option in whole or in part.

 

IN WITNESS WHEREOF, this Agreement is made effective on the date first set forth above at Orange County, California.

 

 

 

  Company: XINDA, INTERNATIONAL, INC, a Nevada Corporation
   
  By: /s/ Joseph Grimes                      
  Name: Joseph Grimes
  Title: CEO

 

 

 

 

 

 

 

 

 

  13  
 

 

OPTIONEE ACKNOWLEDGES AND AGREES THAT THE VESTING OF SHARES PURSUANT TO SECTION 3 HEREOF IS EARNED ONLY BY CONTINUING SERVICE AS AN DIRECTOR AT THE WILL OF THE COMPANY (NOT THROUGH THE ACT OF BEING HIRED, BEING GRANTED THIS OPTION OR ACQUIRING SHARES HEREUNDER). OPTIONEE FURTHER ACKNOWLEDGES AND AGREES THAT THIS OPTION, THE COMPANY’S PLAN WHICH IS INCORPORATED HEREIN BY REFERENCE, THE TRANSACTIONS CONTEMPLATED HEREUNDER AND THE VESTING SCHEDULE SET FORTH HEREIN DO NOT CONSTITUTE AN EXPRESS OR IMPLIED PROMISE OF CONTINUED ENGAGEMENT AS AN DIRECTOR FOR THE VESTING PERIOD, FOR ANY PERIOD, OR AT ALL, AND SHALL NOT INTERFERE WITH OPTIONEE'S RIGHT OR THE COMPANY'S RIGHT TO TERMINATE OPTIONEE'S EMPLOYMENT OR CONSULTING RELATIONSHIP AT ANY TIME, WITH OR WITHOUT CAUSE.

 

Optionee acknowledges receipt of a copy of the Plan, represents that Optionee is familiar with the terms and provisions thereof, and hereby accepts the Option subject to all of the terms and provisions thereof. Optionee has reviewed the Plan and this Agreement in their entirety, has had an opportunity to obtain the advice of counsel prior to executing this Agreement and fully understands all provisions of the Plan and this Agreement. Optionee hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Board or of the Committee upon any questions arising wider the Plan.

 

IN WITNESS WHEREOF, this Agreement is made effective on the date first set forth above at Orange County, California.

 

 

 

 

 

  OPTIONEE
   
  /s/ Joseph Grimes                     
  Name: Joseph Grimes
   

 

 

 

 

 

 

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CONSENT OF SPOUSE

 

 

The undersigned spouse of the Optionee to the foregoing Stock Option Agreement acknowledges on his or her own behalf that: I have read the foregoing Stock Option Agreement and I know its contents. I hereby consent to and approve of the provisions of the Stock Option Agreement, and agree that the Shares issued upon exercise of the Option covered thereby and my interest in them shall be subject to the provisions of the Stock Option Agreement and that I will take no action at any time to hinder operation of the Stock Option Agreement as to the Shares or my interest in the Shares.

 

IN WITNESS WHEREOF, this Agreement is made effective on the date first set forth above at Orange County, California.

 

 

 

 

 

 

 

 

  __________________________________
  Name:
   
   
   

 

 

 

 

 

 

 

 

 

 

 

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EXHIBIT TO OPTION

SUBSCRIPTION FORM AND NOTICE OF EXERCISE

 

XINDA, INTERNATIONAL, Inc.                                                                            Date:

Attn: President

65 Enterprise

Aliso Viejo, CA 92656

 

Ladies and Gentlemen:

 

The undersigned, the holder of the enclosed Option, hereby irrevocably elects to exercise the purchase rights represented by the Option and to purchase there under ________________ shares of Common Stock of XINDA, INTERNATIONAL, INC. (the "Company"), and herewith encloses payment of $_________and/or ___________shares of the Company's common stock, (the "Purchase Price") in full payment of the Purchase Price of such shares being purchased.

 

Exercise of the Option shall not be deemed effective unless and until good and immediately available funds in the full amount of the Purchase Price have been confirmed in the account of the Company. The original Option shall be presented with this Subscription Form and Notice of Exercise.

 

The Company may, in its discretion, withhold a portion of some or all of the exercised shares or other amounts for the payment of taxes or other items. Holder represents that Holder is not subject to any backup withholding requirements. Holder acknowledges that the shares of stock of the Company issued upon exercise will not be entitled to any dividend declared upon such stock prior to the effective date of exercise of the Option.

 

Holder hereby constitutes this Subscription Form and Notice of Exercise as an assignment, deposit tender, and transfer in blank of the Option as set forth therein. Holder hereby irrevocably constitutes and appoints the secretary of the Company as Holder's attorney in fact to issue shares upon the exercise of the Option and reflect the same on the books and records of the Company, cancel the Option, issue a new Option, if applicable, and perform any necessary act on behalf of Holder, with full power substitution.

 

 

  Very truly yours,
   
  ________________________________
   
  By: _____________________________
   
  Title: ___________________________

 

 

 

 

 

 

 

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Exhibit 31.1

 

 

CERTIFICATION BY THE CHIEF EXECUTIVE OFFICER

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

 

I, Joe Grimes, certify that:

 

1. I have reviewed this annual report on Form 10-K of Tribal Rides International Corp.

 

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the issuer as of, and for, the periods presented in this report;

 

4. The issuer’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control for financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the issuer and have:

 

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the issuer is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

(c) Evaluated the effectiveness of the issuer’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 

(d) Disclosed in this report any change in the issuer’s internal control over financial reporting that occurred during the issuer’s most recent fiscal quarter (the issuer’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the issuer’s internal control over financial reporting; and

 

5. The issuer’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the issuer’s auditors and the audit committee of the issuer’s board of directors (or persons performing the equivalent functions):

 

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the issuer’s ability to record, process, summarize and report financial information; and

 

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the issuer’s internal control over financial reporting.

 

 

Date:September 27, 2021 /s/ Joe Grimes
  Joe Grimes
  Chief Executive Officer

Exhibit 31.2

 

 

CERTIFICATION BY THE CHIEF EXECUTIVE OFFICER

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

 

I, Joe Grimes, certify that:

 

1. I have reviewed this annual report on Form 10-K of Tribal Rides International Corp.

 

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the issuer as of, and for, the periods presented in this report;

 

4. The issuer’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control for financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the issuer and have:

 

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the issuer is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

(c) Evaluated the effectiveness of the issuer’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 

(d) Disclosed in this report any change in the issuer’s internal control over financial reporting that occurred during the issuer’s most recent fiscal quarter (the issuer’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the issuer’s internal control over financial reporting; and

 

5. The issuer’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the issuer’s auditors and the audit committee of the issuer’s board of directors (or persons performing the equivalent functions):

 

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the issuer’s ability to record, process, summarize and report financial information; and

 

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the issuer’s internal control over financial reporting.

 

 

Date: September 27, 2021 /s/ Joe Grimes
  Joe Grimes
  Chief Financial Officer

Exhibit 32.1

 

Certification by the Chief Executive Officer

Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

 

Pursuant to 18 U. S. C. Section 1350, I, Joe Grimes, hereby certify that, to the best of my knowledge, the Annual Report on Form 10-K of Tribal Rides International Corp. for the year ended December 31, 2020 (the “Report”) fully complies with the requirements of Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934, as amended, and that the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of. the Tribal Rides International Corp.

 

 

Date: September 27, 2021 /s/ Joe Grimes
  Joe Grimes
  Chief Executive Officer

 

Exhibit 32.2

 

Certification by the Chief Executive Officer

Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

 

Pursuant to 18 U. S. C. Section 1350, I, Joe Grimes, hereby certify that, to the best of my knowledge, the Annual Report on Form 10-K of Tribal Rides International Corp. for the year ended December 31, 2020 (the “Report”) fully complies with the requirements of Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934, as amended, and that the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of. the Tribal Rides International Corp.

 

Date: September 27, 2021 /s/ Joe Grimes
  Joe Grimes
  Chief Financial Officer