Exhibit 2.2

AMERI HOLDINGS, INC.

 

and

 

JAY PHARMA MERGER SUB, INC.

 

and

 

JAY PHARMA INC.

 

and

 

1236567 B.C. UNLIMITED LIABILITY COMPANY

 

and

 

BARRY KOSTINER

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Dated effective as of January 10, 2020

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(iv)

Parent is in compliance in all material respects with the applicable provisions of the Sarbanes-Oxley Act that are effective as of the date of this Agreement.

(m)

Disclosure Controls and Internal Control over Financial Reporting.  The Parent and the Parent Subsidiaries maintain a system of internal accounting controls designed to provide reasonable assurance that:  (i) transactions are executed in accordance with management’s general or specific authorization; (ii) transactions are recorded as necessary in order to permit preparation of financial statements in accordance with United States GAAP and to maintain accountability for assets; (iii) access to assets is permitted only in accordance with management’s general or specific authorization; and (iv) the recorded accountability for assets is compared with existing assets at reasonable intervals and appropriate action is taken with respect to any differences.  The Parent and the Parent Subsidiaries maintain internal controls over financial reporting that provides reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with United States GAAP.

(n)

Auditors. The Parent Financial Statements have been audited by a PCAOB registered accounting firm.

(o)

No Undisclosed Liabilities.  None of the Parent, the Purchaser or any of their respective Subsidiaries have any Liability, whether accrued, absolute, contingent or otherwise, not reflected in the Parent Financial Statements, except Liabilities (i) incurred in connection with this Agreement or the Transaction, (ii) incurred since December 31, 2018, in the Ordinary Course consistent with past practices or (iii) that would not have, individually or in the aggregate, a Material Adverse Effect with respect to the Parent. An itemized list setting forth the principal amount of all indebtedness for borrowed money of the Parent, the Purchaser and any of their respective Subsidiaries (and all accrued interest thereon) as of the date hereof, including capital leases, is disclosed in the Parent Disclosure Letter or the SEC Documents.

(p)

Absence of Certain Changes or Events.  Since December 31, 2018, other than the transactions contemplated in this Agreement and as disclosed in the Parent Disclosure Letter or the SEC Documents, the business of the Parent, the Purchaser and their respective Subsidiaries has been conducted in the Ordinary Course and there has not been any event, circumstance or occurrence which has had or would be reasonably expected to have, individually or in the aggregate, a Material Adverse Effect with respect to the Parent.

(q)

Ordinary Course.  Since December 31, 2018, other than the transactions contemplated in this Agreement or as disclosed in the Parent Disclosure Letter or the SEC Documents:

(i)

the Parent, the Purchaser and their respective Subsidiaries have conducted their respective businesses only in the Ordinary Course;

(ii)

no liability or obligation of any nature (whether absolute, accrued, contingent or otherwise), which has had, or is reasonably likely to have, a Material Adverse Effect with respect to the Parent, has been incurred by the Parent, the Purchaser or their respective Subsidiaries;

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(iii)

there has not been any change in the accounting practices used by the Parent, the Purchaser or their respective Subsidiaries;

(iv)

except for Ordinary Course adjustments to employee compensation (other than directors or officers), there has not been any increase in the salary, bonus, or other remuneration payable to any employees of any of the Parent, the Purchaser or their respective Subsidiaries;

(v)

there has not been any redemption, repurchase or other acquisition of Parent Common Stock by the Parent, or any declaration, setting aside or payment of any dividend or other distribution (whether in cash or otherwise) with respect to the Parent Common Stock;

(vi)

there has not been a material change in the level of accounts receivable or payable, inventories or employees of the Parent, the Purchaser or their respective Subsidiaries, other than those changes in the Ordinary Course;

(vii)

neither the Parent nor any Parent Subsidiary has entered into, or amended, any Material Contract other than in the Ordinary Course;

(viii)

there has not been any satisfaction or settlement of any material claims or material liabilities of the Parent, the Purchaser or their respective Subsidiaries that were not reflected in the Parent Financial Statements, other than the settlement of claims or liabilities incurred in the Ordinary Course; and

(ix)

except for Ordinary Course adjustments, there has not been any increase in the salary, bonus, or other remuneration payable to any officers or directors of the Parent, the Purchaser or their respective Subsidiaries or any amendment or modification to the vesting or exercisability schedule or criteria, including any acceleration, right to accelerate or acceleration event or other entitlement under any stock option, restricted stock, deferred compensation or other compensation award of any officer of the Parent or any Parent Subsidiary.

(r)

Related Party Transactions.  Neither the Parent nor any Parent Subsidiary is indebted to any director, officer, employee or agent of, or independent contractor to, the Parent or any Parent Subsidiary (except for amounts due in the Ordinary Course as salaries, bonuses and director’s fees or the reimbursement of Ordinary Course expenses).  There are no Contracts (other than employment arrangements) with, or advances, loans, guarantees, liabilities or other obligations to, on behalf or for the benefit of, any shareholder, officer or director of the Parent or any Parent Subsidiary.

(s)

Authorizations and Licenses.

(i)

The Parent, the Purchaser and their respective Subsidiaries own, possess or have obtained all Authorizations that are required by Applicable Laws in connection with the operation of the business of the Parent, the Purchaser and their respective Subsidiaries as presently or previously conducted, or in connection with the ownership, operation or use of the assets of the Parent, the Purchaser and their respective Subsidiaries.

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(ii)

The Parent, the Purchaser and their respective Subsidiaries lawfully hold, own or use, and have complied with, all such Authorizations. Each Authorization is valid and in full force and effect, and is renewable by its terms or in the Ordinary Course.

(iii)

No action, investigation or proceeding is pending in respect of or regarding any such Authorization and neither the Parent, the Purchaser, their respective Subsidiaries nor, to the knowledge of the Parent, any of their respective officers or directors has received notice of revocation, non-renewal or material amendments of any such Authorization.

(t)

Opinions of Parent Financial Advisor.  The Parent Board have received the Parent Fairness Opinion. A true and complete copy of the engagement letter between the Parent and Gemini Partners, Inc. has been provided to the Company and the Parent has made true and complete disclosure to the Company of all fees, commissions or other payments that may be incurred pursuant to such engagement or that may otherwise be payable to Gemini Partners, Inc.

(u)

Finders’ Fees.  Except for the engagement letter between the Parent and Palladium Capital Advisors, LLC and the fees payable under or in connection with such engagement, no investment banker, broker, finder, financial adviser or other intermediary has been retained by or is authorized to act on behalf of the Parent or any of its Subsidiaries, or any of their respective officers, directors or employees, or is entitled to any fee, commission or other payment from the Parent or any of its Subsidiaries, or any of their respective officers, directors or employees, in connection with the Agreement.

(v)

Parent Board Approval. The Parent Board, after consultation with its financial and legal advisors, has (A) determined that the Amalgamation, this Agreement the issuance of the Consideration Shares, the Parent Charter Amendment and the Stock Split are fair to the Parent Stockholders and in the best interests of the Parent, the Purchaser, their respective Subsidiaries and the Parent Stockholders; (B) resolved to recommend that the Parent Stockholders vote in favour of the Parent Stockholder Approval Resolution; and (C) authorized the entering into of this Agreement and the performance by the Parent of its obligations under this Agreement, and no action has been taken to amend, or supersede such determinations, resolutions, or authorizations (the “Parent Board Approval”).

(w)

Material Contracts.

(i)

All of the Parent’s Material Contracts are filed as exhibits to the Parent’s latest Annual Report on Form 10-K and the Parent is not a party to any other Material Contracts that are not so filed as exhibits to the Annual Report on Form 10-K. True and complete copies of the Material Contracts of the Parent, the Purchaser and their respective Subsidiaries have been made available to the Company or are filed as exhibits to the Parent’s latest Annual Report on Form 10-K and no such Contract has been modified, rescinded or terminated.

(ii)

Each Material Contract is legal, valid, binding and in full force and effect and is enforceable by the Parent, the Purchaser or their respective Subsidiaries, as applicable, in accordance with its terms (subject to the Bankruptcy and Equity Exceptions).

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(iii)

Each of the Parent, the Purchaser and their respective Subsidiaries has performed in all material respects all respective obligations required to be performed by them to date under the Material Contracts and neither the Parent, Purchaser nor any of their respective Subsidiaries is in breach or default under any Material Contract, nor does the Parent have knowledge of any condition that, with the passage of time or the giving of notice or both, would result in such a breach or default.

(iv)

None of the Parent, the Purchaser or any of their respective Subsidiaries has received any notice, that any party to a Material Contract intends to cancel, terminate or otherwise modify or not renew its relationship with the Parent, the Purchaser or any of their respective Subsidiaries, as applicable, and, to the knowledge of the Parent, no such action has been threatened.

(x)

Real Property. Except as disclosed in the Parent Disclosure Letter:

(i)

the Parent, the Purchaser or their respective Subsidiaries, as applicable, have valid, good and marketable title to all of the real or immovable property owned by the Parent, the Purchaser or their respective Subsidiaries, as applicable (the “Parent Owned Properties”), free and clear of any Liens, except for Permitted Liens, and there are no outstanding options or rights of first refusal to purchase the Parent Owned Properties, or any portion thereof or interest therein;

(ii)

each lease, sublease, license or occupancy agreement (in each case, together with any amendments, supplements, notices and ancillary agreements thereto) for real or immovable property leased, subleased, licensed or occupied by the Parent, the Purchaser or their respective Subsidiaries, as applicable (the “Parent Leased Properties”), is valid, legally binding and enforceable against the Parent, the Purchaser or their respective Subsidiaries, as applicable, in accordance with its terms and in full force and effect, true and complete copies of which (including all related amendments, supplements, notices and ancillary agreements) have been made available to the Company, and none of the Parent, the Purchaser or their respective Subsidiaries, as applicable, is in breach of, or default under, such lease, sublease, license or occupancy agreement, and, to the knowledge of the Parent, no event has occurred which, with notice, lapse of time or both, would constitute such a breach or default the Parent, the Purchaser or their respective Subsidiaries, as applicable, or permit termination, modification or acceleration by any third party thereunder;

(iii)

no third party has repudiated or has the right to terminate or repudiate any such lease, sublease, license or occupancy agreement (except for the normal exercise of remedies in connection with a default thereunder or any termination rights set forth in the lease, sublease, license or occupancy agreement) or any provision thereof; and

(iv)

none of the leases, subleases, licenses or occupancy agreements has been assigned by the Parent, the Purchaser or their respective Subsidiaries, as applicable, in favor of any Person or sublet or sublicensed.

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(y)

Personal Property; Condition of Personal Property.  The Parent, the Purchaser or their respective Subsidiaries, as applicable, have good title to all material personal or movable property of any kind or nature which the Parent, the Purchaser or their respective Subsidiaries, as applicable, purport to own, free and clear of all Liens (other than Permitted Liens). The Parent, the Purchaser or their respective Subsidiaries, as applicable, as lessee, have the right under valid and subsisting leases to use, possess and control all personal or movable property leased by, and material to, the Parent, the Purchaser or their respective Subsidiaries, as applicable, as used, possessed and controlled by the Parent, the Purchaser or their respective Subsidiaries, as applicable. All real and tangible personal property of the Parent, the Purchaser or their respective Subsidiaries is in generally good repair and is operational and usable in the manner in which it is currently being utilized, subject to normal wear and tear and technical obsolescence, repair or replacement.

(z)

Intellectual Property.  Except as would not and would not be reasonably expected to have, individually or in the aggregate, a Material Adverse Effect with respect to the Parent: (i) the Parent, the Purchaser or their respective Subsidiaries, as applicable, own all right, title and interest, or have valid licenses (and are not in material breach of such licenses), in and to all Intellectual Property that is material to the conduct of the business, as presently conducted, of the Parent, the Purchaser or their respective Subsidiaries, as applicable (collectively, the “Parent Intellectual Property Rights”); (ii) all such Parent Intellectual Property Rights that are owned by or licensed to the Parent, the Purchaser or their respective Subsidiaries, as applicable, are sufficient, in all material respects, for conducting the business, as presently conducted, of the Parent, the Purchaser or their respective Subsidiaries, as applicable; (iii) to the knowledge of the Parent, all Parent Intellectual Property Rights owned or leased by the Parent, the Purchaser or their respective Subsidiaries, as applicable, are valid and enforceable, and the carrying on of the business of the Parent, the Purchaser or their respective Subsidiaries, as applicable, and the use by the Parent, the Purchaser or their respective Subsidiaries, as applicable, of any of the Parent Intellectual Property Rights or Parent Technology (as defined below) owned by or licensed to the Parent, the Purchaser or their respective Subsidiaries, as applicable, does not breach, violate, infringe or interfere with any rights of any other Person, except that the foregoing representation is given to the knowledge of Parent with respect to patents, and no proceeding is currently pending or, to the knowledge of Parent, threatened, with respect to any of the foregoing; (iv) to the knowledge of the Parent, no third party is infringing upon the Parent Intellectual Property Rights owned or licensed by the Parent, the Purchaser or their respective Subsidiaries, as applicable, and no proceeding is currently pending or threatened with respect to the foregoing; (v) all computer hardware and associated firmware and operating systems, application software, database engines and processed data, technology infrastructure and other computer systems used in connection with the conduct of the business, as presently conducted, of the Parent, the Purchaser or their respective Subsidiaries, as applicable (collectively, the “Parent Technology”), are sufficient, in all material respects, for conducting the business, as presently conducted, of the Parent, the Purchaser or their respective Subsidiaries, as applicable; and (vi) the Parent, the Purchaser or their respective Subsidiaries, as applicable own, or have validly licensed or leased (and are not in material breach of such licenses or leases), such Parent Technology.

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(aa)

Restrictions on Conduct of Business.  Neither the Parent, the Purchaser nor any of their respective Subsidiaries is a party to or bound by any non-competition agreement, any non-solicitation agreement, or any other agreement, obligation, judgment, injunction, order or decree which purports to: (i) limit in any material respect the manner or the localities in which all or any portion of the business of the Parent, the Purchaser or their respective Subsidiaries are conducted; (ii) limit any business practice of the Parent, the Purchaser or their respective Subsidiaries in any material respect; or (iii) restrict any acquisition or disposition of any property by the Parent, the Purchaser or their respective Subsidiaries in any material respect. Neither the Parent, the Purchaser nor any of their respective Subsidiaries or any of their respective properties or assets is subject to any outstanding judgment, order, writ, injunction or decree that would have or would be reasonably expected to have, individually or in the aggregate, a Material Adverse Effect with respect to the Parent, or that would or would be reasonably expected to prevent or delay the consummation of the Amalgamation or the transactions contemplated hereby.

(bb)

Litigation.  There are no claims, actions, suits, arbitrations, inquiries, audits, investigations or proceedings pending, or, to the knowledge of the Parent threatened, against or relating to the Parent, the Purchaser or their respective Subsidiaries, the business of the Parent, the Purchaser or their respective Subsidiaries or affecting any of their respective current or former properties or assets by or before any Governmental Authority that, if determined adverse to the interests of the Parent, the Purchaser or their respective Subsidiaries, could potentially result in criminal sanction, or would be reasonably expected to prevent or delay the consummation of the Amalgamation or the transactions contemplated hereby, or would, or would be reasonably expected to, materially affect the Parent’s ability to own or operate the business of the Parent, the Purchaser or their respective Subsidiaries, nor, to the knowledge of the Parent, are there any events or circumstances which could reasonably be expected to give rise to any such claim, action, suit, arbitration, inquiry, investigation or proceeding. There is no bankruptcy, liquidation, winding-up or other similar proceeding pending or in progress, or, to the knowledge of the Parent, threatened against or relating to the Parent, the Purchaser or their respective Subsidiaries before any Governmental Authority.

(cc)

Corrupt Practices Legislation. Neither the Parent, the Purchaser, their respective Subsidiaries nor any of their respective officers, directors or employees acting on behalf of any of them, has taken, committed to take or been alleged to have taken any action which would cause the Parent or any of its Subsidiaries to be in violation of 18 United States Code §201, the Foreign Corrupt Practices Act, or any law of similar effect of any other jurisdiction, and to the knowledge of the Parent, no such action has been taken by any of its agents, representatives or other Persons acting on behalf of the Parent, the Purchaser or their respective Subsidiaries.

(dd)

Intentionally Omitted.

(ee)

Employment Matters.

(i)

(A) The Parent has not entered into any written or oral agreement or understanding providing for a retention or change of control bonus or severance or termination payments to any director, officer or Parent Employees in connection with the termination of their position or their employment as a direct result of a change in control of the Parent (including as a result of the Amalgamation), and (B) no Parent Employee has any agreement as to length of notice or severance payment required to terminate his or her employment, other than such as results by Applicable Law from the employment of an employee without an agreement as to notice or severance;

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(ii)

(A) the Parent is not a party to any Collective Agreement with respect to any Parent Employees, (B) no Person holds bargaining rights with respect to any Parent Employees and (C) to the knowledge of the Parent, no Person has applied or threatened to be certified as the bargaining agent of any Parent Employees;

(iii)

no trade union has applied to have the Parent declared a common or related employer pursuant to Applicable Laws;

(iv)

the Parent is in material compliance with all terms and conditions of employment and all Applicable Laws respecting employment;

(v)

the Parent is not subject to any pending or, to the knowledge of the Parent, threatened claim or action relating to employment or termination of employment of employees or independent contractors;

(vi)

the Parent has not and is not engaged in any unfair labor practice and no unfair labor practice complaint, grievance or arbitration proceeding is pending, or to the knowledge of the Parent, threatened against the Parent;

(vii)

no labor strike, lock-out, slowdown or work stoppage is pending or to the knowledge of the Parent, threatened against or directly affecting the Parent and no such event has occurred in the last two years;

(viii)

each independent contractor and consultant has been properly classified by the Parent as an independent contractor and the Parent has not received notification from any Governmental Authority challenging the classification of any individual who performs services for the Parent’s business as an independent contractor or consultant; and

(ix)

there are no outstanding assessments, penalties, fines, liens, charges, surcharges, or other amounts due or owing pursuant to any workplace safety and insurance legislation and there are no orders under applicable occupational health and safety legislation relating to the Parent which are currently outstanding.

(ff)

Employee Plans.

(i)

Set forth in the Parent Disclosure Letter is, as of the date of this Agreement, a complete and accurate list of each material pension, benefit, insurance, retirement, compensation, deferred compensation, incentive, bonus, employee loan, collective bargaining, profit sharing, commission, performance award, option, phantom equity, stock or stock-based, stock purchase, restricted stock, change in control, retention, severance, vacation, paid time off, welfare, fringe-benefit and other similar agreement, plan, policy, program or arrangement (and any amendments thereto), in each case whether or not reduced to writing and whether funded or unfunded, whether or not Tax-qualified, which is or has been maintained, sponsored, contributed to, or required to be contributed to by the Parent or any ERISA Affiliate of Parent for the benefit of any current or former Parent Employee or director, or under which the Parent has or may have any Liability, contingent or otherwise (collectively, the “Parent Employee Plans”).  Neither the Parent nor, to the knowledge of the Parent, any other Person, has made any commitment to modify, change or terminate any Parent Employee Plan, other than with respect to a modification, change or termination required by Applicable Laws.  With respect to each material Parent Employee Plan, Parent has made available to the Company accurate and complete copies of the following documents: (A) the plan document and any related trust agreement, including amendments thereto; (B) any current summary plan descriptions and other material communications to participants relating to the plan; (C) each plan trust, insurance, annuity or other funding contract or service provider agreement related thereto; (D) the most recent plan financial statements and actuarial or other valuation reports prepared with respect thereto, if any; (E) the most recent IRS determination or opinion letter, if any; (F) copies of the most recent plan year nondiscrimination and coverage testing results for each plan subject to such testing requirements; and (G) the most recent annual reports (Form 5500) and all schedules attached thereto for each Parent Employee Plan that is subject to ERISA and Code reporting requirements.

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(ii)

Each Parent Employee Plan is being, and has been, administered in accordance with its terms and in compliance with the requirements prescribed by any and all Applicable Laws (including ERISA and the Code), in all material respects.  The Parent is not in material default under or material violation of, and has no knowledge of any material defaults or material violations by any other party to, any Parent Employee Plans.  All contributions required to be made by the Parent or any ERISA Affiliate to any Parent Employee Plan have been timely paid or accrued on the most recent Parent Financial Statements, if required under United States GAAP, in each case, in all material respects.  Any Parent Employee Plan intended to be qualified under Section 401(a) of the Code has obtained from the IRS a favorable determination letter or opinion letter as to its qualified status under the Code, and to the knowledge of the Parent, no event has occurred and no condition exists with respect to the form or operation of such Parent Employee Plan that would cause the loss of such qualification.

(iii)

No Parent Employee Plan provides retiree medical to any Person, except as required by COBRA.  No suit, administrative proceeding or action has been brought, or to the knowledge of the Parent, is threatened against or with respect to any such Parent Employee Plan, including any audit or inquiry by the IRS or other applicable Governmental Authority (other than routine claims for benefits arising under such plans).

(iv)

Neither the Parent nor any ERISA Affiliate of the Parent has, during the past six (6) years from the date hereof, maintained, established, sponsored, participated in or contributed to, or is obligated to contribute to, or otherwise incurred any obligation or liability (including any contingent liability) under, any “multiemployer plan” (as defined in Section 3(37) of ERISA) or any “pension plan” (as defined in Section 3(2) of ERISA) subject to Title IV of ERISA or Section 412 of the Code.  Neither the Parent nor any ERISA Affiliate has, as of the date of this Agreement, any actual or potential withdrawal liability (including any contingent liability) for any complete or partial withdrawal (as defined in Sections 4203 and 4205 of ERISA) from any multiemployer plan.

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(v)

Consummation of the Amalgamation and the other transactions contemplated hereby will not (i) entitle any current or former employee or other service provider of the Parent or any ERISA Affiliate to any payment (including golden parachute, bonus or benefits under any Parent Employee Plan); (ii) accelerate the time of payment or vesting of any such benefits or increase the amount of compensation due any such employee or service provider; (iii) result in the forgiveness of any indebtedness; (iv) result in any obligation to fund future benefits under any Parent Employee Plan; or (v) result in the imposition of any restrictions with respect to the amendment or termination of any of Parent Employee Plans.  No benefit payable or that may become payable by the Parent pursuant to any Parent Employee Plan in connection with the Amalgamation or as a result of or arising under this Agreement will constitute an “excess parachute payment” (as defined in Section 280G(b)(1) of the Code) subject to the imposition of an excise Tax under Section 4999 of the Code or the deduction for which would be disallowed by reason of Section 280G of the Code.

(gg)

Insurance. A true and complete list of all material insurance policies currently in effect that insure the physical properties, business, operations and assets of the Parent, the Purchaser and their respective Subsidiaries has been made available to the Company. To the knowledge of the Parent, each material insurance policy currently in effect that insures the physical properties, business, operations and assets of the Parent, the Purchaser and their respective Subsidiaries is valid and binding and in full force and effect and there is no material claim pending under any such policies as to which coverage has been questioned, denied or disputed by any insurer or as to which any insurer has made any reservation of rights or refused to cover all or any material portion of such claims.  All material proceedings covered by any insurance policy of the Parent or its Subsidiaries have been properly reported to and accepted by the applicable insurer.

(hh)

Taxes.  The Parent, the Purchaser and their respective Subsidiaries have made available to the Company true, correct and complete copies of all Tax Returns, examination reports and statements of deficiencies for taxable periods, or transactions consummated, for which the applicable statutory periods of limitations have not expired. Except as disclosed on the Parent Disclosure Letter:

(i)

the Parent, the Purchaser and their respective Subsidiaries have duly and timely filed all Tax Returns required to be filed by them prior to the date hereof and all such Tax Returns are complete and correct in all material respects;

(ii)

the Parent, the Purchaser and their respective Subsidiaries have paid on a timely basis all Taxes which are due and payable, all assessments and reassessments, and all other Taxes due and payable by them on or before the date hereof, other than those which are being or have been contested in good faith and in respect of which reserves have been provided in the Parent Financial Statements;

(iii)

the Parent, the Purchaser and their respective Subsidiaries have provided adequate accruals in accordance with United States GAAP in the Parent Financial Statements for any Taxes of the Parent, the Purchaser and their respective Subsidiaries for the period covered by such financial statements that have not been paid whether or not shown as being due on any Tax Returns;

(iv)

since January 1, 2018, no material liability in respect of Taxes not reflected in such statements or otherwise provided for has been assessed, proposed to be assessed, incurred or accrued by the Parent, the Purchaser and their respective Subsidiaries, other than in the Ordinary Course;

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(v)

none of the Parent, the Purchaser and their respective Subsidiaries has received a Tax refund to which it was not entitled;

(vi)

no material deficiencies, litigation, proposed adjustments or matters in controversy exist or have been asserted with respect to Taxes of the Parent, the Purchaser or their respective Subsidiaries, and neither the Parent, the Purchaser nor their respective Subsidiaries are a party to any action or proceeding for assessment or collection of Taxes and no such event has been asserted or, to the knowledge of the Parent, threatened against the Parent, the Purchaser or their respective Subsidiaries or any of their respective assets;

(vii)

no claim has been made by any Government Authority in a jurisdiction where the Parent, the Purchaser and their respective Subsidiaries do not file Tax Returns that the Parent, the Purchaser or their respective Subsidiaries are or may be subject to Tax by that jurisdiction;

(viii)

there are no Liens (other than Permitted Liens) with respect to Taxes upon any of the assets of the Parent, the Purchaser or their respective Subsidiaries;

(ix)

the Parent, the Purchaser and their respective Subsidiaries have withheld or collected all amounts required to be withheld or collected by it on account of Taxes and has remitted all such amounts to the appropriate Governmental Authority when required by Applicable Law to do so;

(x)

there are no outstanding agreements extending or waiving the statutory period of limitations applicable to any claim for, or the period for the collection or assessment or reassessment of Taxes due from the Parent, the Purchaser or their respective Subsidiaries for any taxable period and no request for any such waiver or extension is currently pending;

(xi)

no closing agreements, private letter rulings, technical advice memoranda or similar agreements or rulings have been entered into by the Parent, the Purchaser or their respective Subsidiaries with any taxing authority or issued by any taxing authority to the Parent, the Purchaser or their respective Subsidiaries;

(xii)

there are no outstanding rulings of, or request for rulings with, any Governmental Authority addressed to the Parent, the Purchaser or their respective Subsidiaries that are, or if issued would be, binding on the Parent, the Purchaser or their respective Subsidiaries;

(xiii)

none of the Parent, the Purchaser or their respective Subsidiaries is a party to any Contract with any third party relating to allocating or sharing the payment of, or liability for, Taxes or Tax benefits (other than pursuant to customary provisions included in credit agreements, leases, and agreements entered with employees, in each case, not primarily related to Taxes and entered into in the Ordinary Course);

(xiv)

none of the Parent, the Purchaser or their respective Subsidiaries has any liability for the Taxes of any third party under Section 1.1502-6 of the Treasury Regulations (or any similar provision under Applicable Laws) as a transferee or successor or otherwise by operation of Applicable Laws;

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(xv)

none of the Parent, the Purchaser or their respective Subsidiaries have participated in any “listed transaction” within the meaning of Section 1.6011-4 of the Treasury Regulations;

(xvi)

the Parent has disclosed on its respective United States federal income Tax Returns all positions taken therein that could give rise to a substantial understatement of United States federal income Tax within the meaning of Section 6662 of the Code;

(xvii)

none of the Parent, the Purchaser or their respective Subsidiaries are (and have not been for the five-year period ending at the Effective Time) a “United States real property holding corporation” as defined in Section 897(c)(2) of the Code and the applicable Treasury Regulations;

(xviii)

none of the Parent, the Purchaser or their respective Subsidiaries have distributed stock of another Person, or have had its stock distributed by another Person, in a transaction that was purported or intended to be governed in whole or in part by Sections 355 or 361 of the Code;

(xix)

none of the Parent, the Purchaser or their respective Subsidiaries has taken or agreed to take any action that would prevent the Amalgamation from constituting a reorganization qualifying under Section 368 of the Code; and

(xx)

none of the Parent, the Purchaser or their respective Subsidiaries is aware of any agreement, plan or other circumstance that would prevent the Amalgamation from qualifying as a reorganization under Section 368 of the Code.

(ii)

Disclosure.  The information relating to the Parent, the Purchaser or their respective Subsidiaries to be supplied by or on behalf of the Parent for inclusion or incorporation by reference in the S-4 Registration Statement and the Proxy Statement/Prospectus will not, on the date the its filed with the SEC or the date it is first mailed to the Parent Stockholders, as applicable, or at the time of the Parent Meeting, contain any untrue statement of any material fact, or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they are made, not false or misleading at the time and in light of the circumstances under which such statement is made.  The S-4 Registration Statement and the Proxy Statement/Prospectus will comply in all material respects as to form with the requirements of the United States Exchange Act and the rules and regulations thereunder.  Notwithstanding the foregoing, no representation is made by the Parent or the Purchaser with respect to the information that has been or will be supplied by the Company or any of its Representatives for inclusion in the S-4 Registration Statement and the Proxy Statement/Prospectus.

(a)

Organization and Qualification. ExchangeCo is an unlimited liability corporation duly incorporated and validly existing under the laws of British Columbia, and has all necessary power and authority to own its property and assets as now owned and to conduct its affairs as now conducted. ExchangeCo:

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(i)

has all Authorizations necessary to conduct its business substantially as now conducted, except where the failure to hold such Authorizations would not individually or in the aggregate have a Material Adverse Effect on it; and

(ii)

is duly registered or otherwise authorized and qualified to do business and is in good standing in each jurisdiction in which the character of its properties, owned, leased, licensed or otherwise held or the nature of its activities makes such qualification necessary, except where the failure to be so qualified or in good standing would not have a Material Adverse Effect on the Parent or the Purchaser.

(b)

Authorized and Issued Capital.

(i)

All of ExchageCo’s issued and outstanding capital stock is currently held by the Parent and no other person has any right to acquire shares of ExchangeCo.

(ii)

All ExchangeCo Exchangeable Shares and all ExchangeCo Special Shares have been duly authorized and validly issued, and are fully paid and non-assessable and have not been issued in violation of any pre-emptive rights or in violation of Applicable Laws.

(iii)

Except the Voting and Exchange Trust Agreement and the Exchangeable Share Support Agreement, there are no issued, outstanding or authorized options, equity-based awards, warrants, calls, conversion, pre-emptive, redemption, repurchase, stock appreciation or other rights, or any other agreements, arrangements, instruments or commitments of any kind that obligate ExchangeCo to, directly or indirectly, issue or sell any securities of ExchangeCo or give any Person a right to subscribe for or acquire, any securities of ExchangeCo.

(c)

Corporate Authorization. ExchangeCo has the requisite corporate power and authority to enter into and perform its obligations under this Agreement. The execution and delivery of, and performance by, ExchangeCo of this Agreement and the consummation of the Amalgamation and the other transactions contemplated hereby have been, or will at Closing be, duly authorized by all necessary corporate action on the part of each of ExchangeCo and no other corporate actions on the part of ExchangeCo are necessary to authorize this Agreement or to consummate the Amalgamation and the other transactions contemplated hereby.

(d)

ExchangeCo. ExchangeCo was incorporated solely to effect the Amalgamation and ExchangeCo has no assets or liabilities and it has not carried on any business.

(e)

No Conflict. The execution and delivery of, and the performance by ExchangeCo of its obligations under, this Agreement, the completion of the transactions contemplated hereby, and the performance of its obligations hereunder and thereunder, do not and will not (or would not with the giving of notice, the lapse of time or the happening of any other event or condition):

(i)

constitute or result in a violation or breach of, or conflict with, any of the terms or provisions of its Organizational Documents;

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(ii)

require any consent or other action by any Person under, constitute or result in a breach or violation of or conflict with, or, with or without notice or lapse of time or both, allow any Person to exercise any rights under any of the terms or provisions of any Material Contracts, licenses, leases or instruments to which ExchangeCo is a party or pursuant to which any of its assets or properties may be affected;

(iii)

result in a breach of, or cause the termination or revocation of, any Authorization held by ExchangeCo, or necessary to the ownership of the ExchangeCo Exchangeable Shares or ExchangeCo Special Shares, or the operation of the businesses of ExchangeCo; or

(iv)

result in the violation of any Applicable Law,

(f)

Disclosure.  The information relating to ExchangeCo to be supplied by or on behalf of ExchangeCo for inclusion or incorporation by reference in the S-4 Registration Statement and the Proxy Statement/Prospectus will not, on the date the its filed with the SEC or the date it is first mailed to the Parent Stockholders, as applicable, or at the time of the Parent Meeting, contain any untrue statement of any material fact, or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they are made, not false or misleading at the time and in light of the circumstances under which such statement is made.  The S-4 Registration Statement and the Proxy Statement/Prospectus will comply in all material respects as to form with the requirements of the United States Exchange Act and the rules and regulations thereunder.  Notwithstanding the foregoing, no representation is made by ExchangeCo with respect to the information that has been or will be supplied by the Parent, the Purchaser, the Company or any of their respective Representatives for inclusion in the S-4 Registration Statement and the Proxy Statement/Prospectus.

(a)

Except as expressly provided in this Article 6 and for the Parent Legacy Business Disposition, the Company, the Parent, and their respective Subsidiaries shall not, directly or indirectly, through any officer, director, employee, representative (including any financial or other adviser) or other agent of the Company or the Parent or of any of their Subsidiaries (collectively “Representatives”), or otherwise, and shall not permit any such Person to:

(i)

solicit, assist, initiate, encourage or otherwise knowingly facilitate (including by way of furnishing or providing copies of, access to, or disclosure of, any confidential information, properties, facilities, books or records of the Company, the Parent or any of their Subsidiaries or entering into any form of agreement, arrangement or understanding) any inquiry, proposal or offer that constitutes or may reasonably be expected to constitute or lead to, an Acquisition Proposal for the Company or the Parent;

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(ii)

enter into or otherwise engage or participate in any discussions or negotiations with any Person (other than the Parties) regarding any inquiry, proposal or offer that constitutes or may reasonably be expected to constitute or lead to, an Acquisition Proposal for the Company or the Parent;

(iii)

make a Company Change in Recommendation or Parent Change in Recommendation;

(iv)

accept, approve, endorse or recommend, or publicly propose to accept, approve, endorse or recommend, or take no position or remain neutral with respect to, any Acquisition Proposal for the Company or the Parent; or

(v)

accept or enter into or publicly propose to accept or enter into any agreement, understanding or arrangement in respect of an Acquisition Proposal for the Company or the Parent.

(b)

The Company and Parent shall, and shall cause their Subsidiaries and Representatives to, immediately cease and terminate, and cause to be terminated, any solicitation, encouragement, discussion, negotiations, or other activities commenced prior to the date of this Agreement with any Person (other than the Parties) with respect to any inquiry, proposal or offer that constitutes, or may reasonably be expected to constitute or lead to, an Acquisition Proposal for the Company or the Parent, and in connection therewith the Company and the Parent shall:

(i)

immediately discontinue access to and disclosure of all information, including any data room, and any confidential information, properties, facilities, books and records of the Company, the Parent, or any of their respective Subsidiaries; and

(ii)

promptly request, and exercise all rights either has to require: (A) the return or destruction of all copies of any confidential information regarding the Company, the Parent, or any of their respective Subsidiaries provided to any Person other than the Parties, and (B) the destruction of all material including or incorporating or otherwise reflecting such confidential information regarding the Company, the Parent, or any of their respective Subsidiaries, using their commercially reasonable efforts to ensure that such requests are fully complied with in accordance with the terms of such rights or entitlements.

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(c)

The Company and the Parent represent and warrant that, since January 1, 2019, neither the Company nor the Parent has waived any confidentiality, standstill, non-disclosure, non-solicitation, use, business purpose or similar agreement, restriction or covenant to which the Company, the Parent, or any of their respective Subsidiaries is a party, and further covenant and agree that (A) the Company and the Parent shall take all necessary action to enforce each confidentiality, standstill, non-disclosure, non-solicitation, use, business purpose or similar agreement, restriction or covenant to which they or any of their respective Subsidiaries is a party, and (B) neither the Company, the Parent, nor any of their respective Subsidiaries, nor any of their respective Representatives have or will, without the prior written consent of the Parties (which may be withheld or delayed in the Parties’ sole and absolute discretion), release any Person from, or waive, amend, suspend or otherwise modify such Person’s obligations respecting the Company, the Parent, or any of their respective Subsidiaries under any confidentiality, standstill, non-disclosure, non-solicitation, use, business purpose or similar agreement, restriction or covenant to which the Company, the Parent, or any of their respective Subsidiaries is a party (it being acknowledged by the Parties that the automatic termination or release of any standstill restrictions of any such agreement as the result of entering into of this Agreement will not constitute a breach of this Section 6.1(c)).

(d)        Notwithstanding the foregoing, if Parent receives a written Acquisition Proposal from a third party and the receipt of such Acquisition Proposal was not initiated, sought, solicited, knowingly encouraged or knowingly induced by Parent or its subsidiaries, then the Parent may (i) contact the person who has made such Acquisition Proposal in order to clarify the terms of such Acquisition Proposal so that the Parent Board (or any committee thereof) may inform itself about such Acquisition Proposal, (ii) furnish information concerning its business, properties or assets to any person pursuant to a confidentiality agreement with terms that, taken as a whole, are not materially less favorable to the Company than those contained in the Confidentiality Agreement and (iii) negotiate and participate in discussions and negotiations with such person concerning a Acquisition Proposal, in the case of clauses (ii) and (iii), if the Parent Board determines in good faith that such Acquisition Proposal constitutes or is reasonably likely to constitute or lead to a Superior Proposal.  Parent (A) shall promptly (and in any case within twenty-four (24) hours) provide the Company notice (1) of the receipt of any Acquisition Proposal, which notice shall include a complete, unredacted copy of such Acquisition Proposal, and (2) of any inquiries, proposals or offers received by, any requests for non-public information from, or any discussions or negotiations sought to be initiated or continued with, the Parent or any Representatives of the Parent concerning an Acquisition Proposal that constitutes or is reasonably likely to constitute or lead to an Acquisition Proposal, and disclose the identity of the other party (or parties) and the material terms of such inquiry, offer, proposal or request and, in the case of written materials, provide copies of such materials, (B) shall promptly (and in any case within twenty-four (24) hours) make available to the Company copies of all written materials provided by the Parent to such party but not previously made available to the Company and (C) shall keep the Company informed on a reasonably prompt basis (and, in any case, within twenty-four (24) hours of any significant development) of the status and material details (including amendments and proposed amendments) of any such Acquisition Proposal or other inquiry, offer, proposal or request.

 

(e)

If the Parent Board receives an Acquisition Proposal that the Parent Board determines in good faith constitutes a Superior Proposal, the Parent Board may effect a Parent Change in Recommendation and authorize the Parent to terminate this Agreement pursuant to Section 9.2(a)(iv)(A) in order to enter into a definitive agreement providing for a Superior Proposal if (i) the Parent Board determines in good faith that the failure to take such action could reasonably be expected to be inconsistent with the Parent’s directors’ fiduciary duties under applicable Law; (ii) the Parent has notified the Company in writing that it intends to effect a Parent Change in Recommendation or terminate this Agreement; (iii) if applicable, the Parent has provided the Company a copy of the proposed definitive agreements between the Parent and the Person making such Superior Proposal; (iv) for a period of five (5) Business Days following the notice delivered pursuant to clause (ii) of this Section 6.1(e), the Parent shall have discussed and negotiated in good faith and made Representatives of the Parent available to discuss and negotiate in good faith (in each case to the extent the Company desires to negotiate) with Representatives of the Company any proposed modifications to the terms and conditions of this Agreement so that the failure to take such action would no longer reasonably be expected to be inconsistent with the Parent’s directors’ fiduciary duties under applicable Law (it being understood and agreed that any amendment to any material term or condition of any Superior Proposal shall require a new notice and a new four (4) Business Day negotiation period); and (v) no earlier than the end of such negotiation period, the Parent Board shall have determined in good faith, after considering the terms of any proposed amendment or modification to this Agreement, that (x) the Acquisition Proposal that is the subject of the notice described in clause (ii) above still constitutes a Superior Proposal and (y) the failure to take such action would still reasonably be expected to be inconsistent with the Parent’s directors’ fiduciary duties under applicable Law.

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(a)

The Company covenants and agrees that, subject to Applicable Law, during the period from the date of this Agreement until the earlier of the Effective Time and the time that this Agreement is terminated in accordance with its terms, except with the express prior written consent of the Parent and the Purchaser or as required or permitted by this Agreement, the Company shall conduct its business in the Ordinary Course and in accordance with Applicable Law.

---

(b)

Without limiting the generality of Section 7.2(a), subject to Applicable Law, the Company covenants and agrees that, during the period from the date of this Agreement until the earlier of the Effective Time and the time that this Agreement is terminated in accordance with its terms, except with the express prior written consent of the Parent and the Purchaser or as required or permitted by this Agreement, the Company shall use its reasonable commercially reasonable efforts to maintain and preserve intact the current business organization, assets, properties and business of the Company, maintain in effect all material Authorizations of the Company, keep available the services of the present employees and agents of the Company and maintain good relations with, and the goodwill of, employees, suppliers, customers, creditors and all other Persons having business relationships with the Company and, except with the prior written consent of the Parent and the Purchaser and as required in connection with the Bridge Loan Financing, the Company shall not, directly or indirectly:

(i)

make any change in its Organizational Documents;

(ii)

split, combine, consolidate or reclassify any shares of its capital stock, undertake any capital reorganization or declare, set aside or pay any dividend or other distribution (whether in cash, stock or property or any combination thereof);

(iii)

redeem, repurchase, or otherwise acquire or offer to redeem, repurchase or otherwise acquire any shares of its capital stock or reduce the stated capital in respect of the Company Common Shares or any other shares of the Company;

(iv)

issue, grant, deliver, sell, pledge or otherwise encumber, or authorize the issuance, grant, delivery, sale, pledge or other encumbrance of any shares of capital stock, securities, options, warrants or similar rights exercisable or exchangeable for or convertible into such capital stock, of the Company, except for the issuance of Company Common Shares (A) issuable upon the exercise of the currently outstanding Company Options or (B) pursuant to outstanding Company Warrants;

(v)

acquire (by merger, consolidation, acquisition of stock or assets or otherwise), directly or indirectly, in one transaction or in a series of related transactions, assets, securities, properties, interests or businesses of any other Person (other than pursuant to the transactions contemplated by this Agreement);

(vi)

reorganize, amalgamate, combine or merge the Company with any other Person (other than pursuant to the transactions contemplated by this Agreement);

(vii)

adopt a plan of liquidation or resolutions providing for the liquidation or dissolution of the Company;

(viii)

sell, pledge, lease, dispose of, surrender, lose the right to use, mortgage, license, encumber (other than Permitted Liens) or otherwise dispose of or transfer any assets of the Company or any interest in any assets of the Company, other than in the Ordinary Course;

(ix)

make any capital expenditure or similar commitments, other than in the Ordinary Course;

---

(x)

make any loan or advance to, or any capital contribution or investment in, or assume, guarantee or otherwise become liable with respect to the liabilities or obligations of, any Person, other than in the Ordinary Course;

(xi)

prepay any long-term indebtedness before its scheduled maturity or increase, create, incur, assume or otherwise become liable, in one transaction or in a series of related transactions, with respect to any indebtedness for borrowed money or guarantees thereof, other than in the Ordinary Course; provided that any indebtedness created, incurred, refinanced, assumed or for which the Company becomes liable in accordance with the any of the foregoing shall be prepayable at the Effective Time without premium, penalty or other incremental costs (including breakage costs);

(xii)

enter into any interest rate, currency, equity or commodity swaps, hedges, derivatives, forward sales contracts or similar financial instruments;

(xiii)

make any bonus or profit sharing distribution or similar payment of any kind;

(xiv)

grant any general increase in the rate of wages, salaries, bonuses or other remuneration of any Company Employees, other than in the Ordinary Course;

(xv)

except as required by United States GAAP, make any change in the Company’s methods of accounting;

(xvi)

make any material Tax election, information schedule, return or designation, except as required by Applicable Law and in a manner consistent with past practice, settle or compromise any material Tax claim, assessment, reassessment or liability, file any amended Tax Return, enter into any material agreement with a Governmental Authority with respect to Taxes, surrender any right to claim a material Tax abatement, reduction, deduction, exemption, credit or refund, consent to the extension or waiver of the limitation period applicable to any material Tax matter or materially amend or change any of its methods or reporting income, deductions or accounting for income Tax purposes except as may be required by Applicable Law;

(xvii)

create, enter into or increase any severance, change of control or termination pay to (or amend any similar existing arrangement with) any Company Employee, director or executive officer of the Company or change the benefits payable under any existing severance or termination pay policies with any Company Employee, director or executive officer of the Company;

(xviii)

except as required by Applicable Law: (A) adopt, enter into or amend any Employee Plan (other than entering into an employment agreement in the Ordinary Course with a new Company Employee who was not employed by the Company on the date of this Agreement); (B) pay any benefit to any director or officer of the Company or to any Company Employee that is not required under the terms of any Employee Plan in effect on the date of this Agreement; (C) grant, accelerate, increase or otherwise amend any payment, award or other benefit payable to, or for the benefit of, any director or officer of the Company or to any Company Employee; (D) make any material determination under any Employee Plan that is not in the Ordinary Course; (E) take or propose any action to effect any of the foregoing; or (F) hire or terminate or promote any employee whose base salary is greater than $75,000;

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(xix)

cancel, waive, release, assign, settle or compromise any material claims or rights;

(xx)

commence, waive, release, assign, settle or compromise any litigation, proceedings or governmental investigations;

(xxi)

amend, modify, terminate or waive any right under any Material Contract or enter into any Contract or agreement that would be a Material Contract if in effect on the date hereof;

(xxii)

except as contemplated in Section 4.1(jj), amend, modify, terminate, cancel or let lapse any material insurance (or re-insurance) policy of the Company in effect on the date of this Agreement, unless simultaneously with such termination, cancellation or lapse, replacement policies underwritten by insurance and re-insurance companies of nationally recognized standing providing coverage equal to or greater than the coverage under the terminated, cancelled or lapsed policies for substantially similar premiums are in full force and effect;

(xxiii)

in respect of any assets of the Company, waive, release, surrender, let lapse, grant or transfer any material right or value or amend, modify or change, or agree to amend, modify or change, in any material respect any existing material Authorization, right to use, lease, contract, production sharing agreement, Intellectual Property (other than the granting of non-exclusive licenses or other dispositions in the Ordinary Course), or other material document;

(xxiv)

abandon or fail to diligently pursue any application for any material Authorizations, licenses, leases, or registrations or take any action, or fail to take any action, that could lead to the termination of any material Authorizations, licenses, leases or registrations;

(xxv)

enter into or amend any Contract with any broker, finder or investment banker; or

(xxvi)

authorize, agree, resolve or otherwise commit, whether or not in writing, to do any of the foregoing.

(a)

carry out this Agreement in accordance with and subject to the terms hereof, and comply promptly with all requirements imposed by Applicable Law on it with respect to this Agreement or the Amalgamation;

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(b)

use all commercially reasonable efforts to obtain and maintain all third party or other consents, waivers, permits, exemptions, orders, approvals, agreements, amendments or confirmations that are (i) necessary or advisable to be obtained under the Material Contracts in connection with the Amalgamation or (ii) required in order to maintain the Material Contracts in full force and effect following completion of the Amalgamation, in each case, on terms that are reasonably satisfactory to the Parent and the Purchaser, and without paying, and without committing itself or the Parent or the Purchaser to pay, any consideration or incur any liability or obligation without the prior written consent of the Parent and the Purchaser;

(c)

use all commercially reasonable efforts to effect all necessary registrations, filings and submissions of information required by Governmental Authorities from the Company relating to the Amalgamation;

(d)

use all commercially reasonable efforts to, on prior written approval of the Parent and the Purchaser, oppose, lift or rescind any injunction, restraining or other order, decree, judgment or ruling seeking to restrain, enjoin or otherwise prohibit or adversely affect the consummation of the Amalgamation and defend, or cause to be defended, any proceedings to which it is a party or brought against it or its directors or officers challenging the Amalgamation or this Agreement;

(e)

not take any action, or refrain from taking any commercially reasonable action, or permitting any action to be taken or not taken, which is inconsistent with this Agreement or which would reasonably be expected to prevent, delay or otherwise impede the consummation of the Amalgamation or the transactions contemplated by this Agreement;

(f)

use all commercially reasonable efforts to, as promptly as practicable, prepare and file all necessary documents, registrations, statements, petitions, filings and applications for any Regulatory Approvals and use commercially reasonable efforts to obtain and maintain all Regulatory Approvals;

(g)

use all commercially reasonable efforts to cooperate with the Parent and the Purchaser in connection with obtaining any Regulatory Approvals including providing the Parent and the Purchaser with copies of all notices and information or other correspondence supplied to, filed with or received from any Governmental Authority;

(h)

concurrently with the Closing, cause all current Company Shareholders except the Noteholder to execute a lock-up agreement substantially in the form attached hereto as Exhibit A (the “Lock-Up Agreement”);

(i)

promptly notify the Parent and the Purchaser in writing of:

(i)

any Material Adverse Effect with respect to the Company or any change, effect, event, development, occurrence, circumstance or state of facts which could reasonably be expected to have a Material Adverse Effect with respect to the Company;

(ii)

any notice or other communication from any Person alleging that the consent (or waiver, permit, exemption, order, approval, agreement, amendment or confirmation) of such Person (or another Person) is or may be required in connection with this Agreement or the Amalgamation;

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(iii)

any notice or other communication from any material supplier, customer or other third party to the effect that such supplier, customer or third party is terminating, may terminate or is otherwise materially adversely modifying or may materially adversely modify its relationship with the Company as a result of this Agreement or the Amalgamation;

(iv)

any notice or other communication from any Governmental Authority in connection with this Agreement (and the Company shall contemporaneously provide a copy of any such written notice or communication to the Purchaser); or

(v)

any filing, actions, suits, claims, investigations or proceedings commenced or, to its knowledge, threatened against, relating to or involving or otherwise affecting the Company or its assets or properties; and

(j)

conduct itself, in all material respects, subject to Applicable Law, so as to keep the Parent and the Purchaser fully informed as to the material decisions required to be made or actions required to be taken with respect to the operation of its business.

(a)

The Parent and the Purchaser covenant and agree that, subject to Applicable Law, during the period from the date of this Agreement until the earlier of the Effective Time and the time that this Agreement is terminated in accordance with its terms, except with the express prior written consent of the Company or as required or permitted by this Agreement, the Parent and the Purchaser shall, and shall cause their respective Subsidiaries to, conduct their business in the Ordinary Course and in accordance with Applicable Law.

(b)

Without limiting the generality of Section 7.4(a), subject to Applicable Law, the Parent and the Purchaser covenant and agree that, during the period from the date of this Agreement until the earlier of the Effective Time and the time that this Agreement is terminated in accordance with its terms, except with the express prior written consent of the Company or as required or permitted by this Agreement or as contemplated by the Parent Legacy Business Disposition or Parent Financing, the Parent and the Purchaser shall, and shall cause their respective Subsidiaries to, use their commercially reasonable efforts to maintain and preserve intact the current business organization, assets, properties and business of the Parent, the Purchaser and their respective Subsidiaries, maintain in effect all material Authorizations of the Parent, the Purchaser and their respective Subsidiaries, keep available the services of the present employees and agents of the Parent, the Purchaser and their respective Subsidiaries and maintain good relations with, and the goodwill of, employees, suppliers, customers, creditors and all other Persons having business relationships with the Parent, the Purchaser and their respective Subsidiaries and, except with the prior written consent of the Company and other than as required in connection with the Parent Legacy Business Disposition and the Stock Split, the Parent and the Purchaser shall not, directly or indirectly, and shall cause their respective Subsidiaries not to:

(i)

make any change in its Organizational Documents, other than the Parent Charter Amendment;

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(ii)

split, combine, consolidate or reclassify any shares of its capital stock, undertake any capital reorganization or declare, set aside or pay any dividend or other distribution (whether in cash, stock or property or any combination thereof), other than the Stock Split;

(iii)

redeem, repurchase, or otherwise acquire or offer to redeem, repurchase or otherwise acquire any shares of its capital stock or reduce the stated capital in respect of the Parent Common Stock or any other shares of the Parent, the Purchaser and their respective Subsidiaries (other than in connection with the redemption or conversion into common stock of the Parent’s outstanding shares of preferred stock prior to the Effective Time);

(iv)

issue, grant, deliver, sell, pledge or otherwise encumber, or authorize the issuance, grant, delivery, sale, pledge or other encumbrance of any shares of capital stock, securities, options, warrants or similar rights exercisable or exchangeable for or convertible into such capital stock, of the Parent, the Purchaser or their respective Subsidiaries, except for the issuance of Parent Capital Stock (A) issuable upon the exercise of the currently outstanding Parent Options, (B) pursuant to outstanding Parent Warrants or (C) issuable in connection with the Parent Financing;

(v)

acquire (by merger, consolidation, acquisition of stock or assets or otherwise), directly or indirectly, in one transaction or in a series of related transactions, assets, securities, properties, interests or businesses of any other Person (other than pursuant to the transactions contemplated by this Agreement);

(vi)

reorganize, amalgamate, combine or merge the Parent, the Purchaser or their respective Subsidiaries with any other Person (other than pursuant to the transactions contemplated by this Agreement);

(vii)

adopt a plan of liquidation or resolutions providing for the liquidation or dissolution of the Parent, the Purchaser or their respective Subsidiaries;

(viii)

sell, pledge, lease, dispose of, surrender, lose the right to use, mortgage, license, encumber (other than Permitted Liens) or otherwise dispose of or transfer any assets of the Parent, the Purchaser or their respective Subsidiaries or any interest in any assets of the Parent, the Purchaser or their respective Subsidiaries, other than in the Ordinary Course;

(ix)

make any capital expenditure or similar commitments, other than in the Ordinary Course;

(x)

make any loan or advance to, or any capital contribution or investment in, or assume, guarantee or otherwise become liable with respect to the liabilities or obligations of, any Person;

(xi)

prepay any long-term indebtedness before its scheduled maturity or increase, create, incur, assume or otherwise become liable, in one transaction or in a series of related transactions, with respect to any indebtedness for borrowed money or guarantees thereof, other than in the Ordinary Course; provided that any indebtedness created, incurred, refinanced, assumed or for which the Parent, the Purchaser or their respective Subsidiaries becomes liable in accordance with the foregoing shall be prepayable at the Effective Time without premium, penalty or other incremental costs (including breakage costs);

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(xii)

enter into any interest rate, currency, equity or commodity swaps, hedges, derivatives, forward sales contracts or similar financial instruments;

(xiii)

make any bonus or profit sharing distribution or similar payment of any kind except as may be required by the terms of a Contract listed in the Parent Disclosure Letter or the SEC Documents;

(xiv)

grant any general increase in the rate of wages, salaries, bonuses or other remuneration of any Parent Employees except as may be required by a Contract listed in the Parent Disclosure Letter or the SEC Documents, other than in the Ordinary Course;

(xv)

except as required by United States GAAP, make any change in the methods of accounting of the Parent, the Purchaser or their respective Subsidiaries;

(xvi)

make any material Tax election, information schedule, return or designation, except as required by Applicable Law and in a manner consistent with past practice, settle or compromise any material Tax claim, assessment, reassessment or liability, file any amended Tax Return, enter into any material agreement with a Governmental Authority with respect to Taxes, surrender any right to claim a material Tax abatement, reduction, deduction, exemption, credit or refund, consent to the extension or waiver of the limitation period applicable to any material Tax matter or materially amend or change any of its methods or reporting income, deductions or accounting for income Tax purposes except as may be required by Applicable Law;

(xvii)

create, enter into or increase any severance, change of control or termination pay to (or amend any existing arrangement with) any Parent Employee, director or executive officer of the Parent, the Purchaser or their respective Subsidiaries or change the benefits payable under any existing severance or termination pay policies with any Parent Employee, director or executive officer of the Parent, the Purchaser or their respective Subsidiaries, except as required by the terms thereof as in effect on the date of this Agreement;

(xviii)

except as required by Applicable Law: (A) adopt, enter into or amend any Parent Employee Plan (other than entering into an employment agreement in the Ordinary Course with a new Parent Employee who was not employed by the Parent, the Purchaser or their respective Subsidiaries on the date of this Agreement); (B) pay any benefit to any director or officer of the Parent, the Purchaser or their respective Subsidiaries or to any Parent Employee that is not required under the terms of any Parent Employee Plan in effect on the date of this Agreement; (C) grant, accelerate, increase or otherwise amend any payment, award or other benefit payable to, or for the benefit of, any director or officer of the Parent, the Purchaser or their respective Subsidiaries or to any Parent Employee; (D) make any material determination under any Parent Employee Plan that is not in the Ordinary Course; or (E) take or propose any action to effect any of the foregoing;

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(xix)

cancel, waive, release, assign, settle or compromise any material claims or rights;

(xx)

commence, waive, release, assign, settle or compromise any litigation, proceedings or governmental investigations;

(xxi)

amend or modify or terminate or waive any right under any Material Contract or enter into any Contract or agreement that would be a Material Contract if in effect on the date hereof;

(xxii)

except as contemplated in Section 5.1(gg), amend, modify, terminate, cancel or let lapse any material insurance (or re-insurance) policy of the Parent, the Purchaser or their respective Subsidiaries in effect on the date of this Agreement, unless simultaneously with such termination, cancellation or lapse, replacement policies underwritten by insurance and re-insurance companies of nationally recognized standing providing coverage equal to or greater than the coverage under the terminated, cancelled or lapsed policies for substantially similar premiums are in full force and effect;

(xxiii)

in respect of any assets of the Parent, the Purchaser or their respective Subsidiaries, waive, release, surrender, let lapse, grant or transfer any material right or value or amend, modify or change, or agree to amend, modify or change, in any material respect any existing material Authorization, right to use, lease, contract, production sharing agreement, Intellectual Property, or other material document;

(xxiv)

abandon or fail to diligently pursue any application for any material Authorizations, licenses, leases, or registrations or take any action, or fail to take any action, that could lead to the termination of any material Authorizations, licenses, leases or registrations;

(xxv)

enter into or amend any Contract with any broker, finder or investment banker; or

(xxvi)

authorize, agree, resolve or otherwise commit, whether or not in writing, to do any of the foregoing.

(a)

carry out in accordance with and subject to the terms of this Agreement and comply promptly with all requirements imposed by Applicable Law on it with respect to this Agreement or the Amalgamation;

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(b)

use all commercially reasonable efforts to obtain and maintain all third party or other consents, waivers, permits, exemptions, orders, approvals, agreements, amendments or confirmations that are (i) necessary or advisable to be obtained under the Material Contracts in connection with the Amalgamation or (ii) required in order to maintain the Material Contracts in full force and effect following completion of the Amalgamation, in each case, on terms that are reasonably satisfactory to the Company, and without paying, and without committing itself or the Company to pay, any consideration or incur any liability or obligation without the prior written consent of the Company;

(c)

use all commercially reasonable efforts to effect all necessary registrations, filings and submissions of information required by Governmental Authorities from each of the Parent and the Purchaser relating to the Amalgamation;

(d)

prepare and submit the NASDAQ Listing Application and use commercially reasonable efforts to cause such NASDAQ Listing Application to be conditionally approved prior to the Effective Time;

(e)

use all commercially reasonable efforts to oppose, lift or rescind any injunction, restraining or other order, decree, judgment or ruling seeking to restrain, enjoin or otherwise prohibit or adversely affect the consummation of the Amalgamation and defend, or cause to be defended, any proceedings to which it is a party or brought against it or its directors or officers challenging the Amalgamation or this Agreement;

(f)

use all commercially reasonable efforts to, as promptly as practicable, prepare and file all necessary documents, registrations, statements, petitions, filings and applications for any Regulatory Approvals and use commercially reasonable efforts to obtain and maintain all Regulatory Approvals;

(g)

use all commercially reasonable efforts to cooperate with the Company in connection with obtaining any Regulatory Approvals including providing the Company with copies of all notices and information or other correspondence supplied to, filed with or received from any Governmental Authority (provided that, notwithstanding anything to the contrary set forth in this Agreement, each of the Parent and the Purchaser are under no obligation to take any steps or actions that would, in their sole discretion, affect the Parent or the Purchaser’s right to own, use or exploit its business, operations or assets or those of the Company);

(h)

not take any action, or refrain from taking any commercially reasonable action, or permitting any action to be taken or not taken, which is inconsistent with this Agreement or which would reasonably be expected to prevent, delay or otherwise impede the consummation of the Amalgamation or the transactions contemplated by this Agreement;

(i)

except as set forth in Section 7.7 hereof, assist in obtaining the resignations (in a form satisfactory to the Company, acting reasonably) of each member of the Parent Board and each member of the board of directors of the Parent’s Subsidiaries, and causing them and the officers of the Parent to be replaced in accordance with Section 7.7;

(j)

prior to the Closing, consummate the Parent Legacy Business Disposition;

(k)

prior to the Closing, consummate the Parent Financing;

(l)

prior to the Closing, obtain the Parent Stockholder Approval;

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(m)

immediately prior to the Effective Time, file the Parent Charter Amendment to become effective at the Effective Time;

(n)

concurrently with the Closing, if necessary, effectuate the Stock Split;

(o)

prior to the Closing, cause all Parent Preferred Stock to be converted into Parent Common Stock;

(p)

adopt a stock incentive plan (the “Resulting Issuer Incentive Stock Plan”) pursuant to which shares of Resulting Issuer Common Stock comprising 15% of the issued and outstanding shares of Resulting Issuer Common Stock post-Closing, on a fully diluted basis, shall be reserved for issuance to employees, directors, consultants, and other service providers;

(q)

promptly notify the Company of:

(i)

any Material Adverse Effect with respect to the Parent or the Purchaser or any change, effect, event, development, occurrence, circumstance or state of facts which could reasonably be expected to have a Material Adverse Effect with respect to the Parent or the Purchaser;

(ii)

any notice or other communication from any Person alleging that the consent (or waiver, permit, exemption, order, approval, agreement, amendment or confirmation) of such Person (or another Person) is or may be required in connection with this Agreement or the Amalgamation;

(iii)

any notice or other communication from any material supplier, customer or other third party to the effect that such supplier, customer or third party is terminating, may terminate or is otherwise materially adversely modifying or may materially adversely modify its relationship with the Parent or the Purchaser as a result of this Agreement or the Amalgamation;

(iv)

any notice or other communication from any Governmental Authority in connection with this Agreement (and the Parent or the Purchaser shall contemporaneously provide a copy of any such written notice or communication to the Company); or

(v)

any filing, actions, suits, claims, investigations or proceedings commenced or, to its knowledge, threatened against, relating to or involving or otherwise affecting the Company or its assets or properties; and

(r)

conduct itself, in all material respects, subject to Applicable Law, so as to keep the Company fully informed as to the material decisions required to be made or actions required to be taken with respect to the operation of its business.

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(a)

The Company shall take all commercially reasonable actions to ensure compliance with all of the applicable conditions precedent in favor of the Parent as set forth in this Agreement.

(b)

The Parent shall take all commercially reasonable actions to ensure compliance with all of the applicable conditions precedent in favor of the Company as set forth in this Agreement.

(a)

Each Party shall promptly notify the other Parties of the occurrence, or failure to occur, of any event or state of facts which occurrence or failure would, or would be reasonably likely to:

(i)

cause any of the representations or warranties of such Party contained in this Agreement to be untrue or inaccurate in any material respect at any time from the date of this Agreement to the Effective Time; or

(ii)

result in the failure, in any material respect, to comply with or satisfy any covenant, condition or agreement to be complied with or satisfied by such Party under this Agreement.

(b)

Notification provided under this Section 7.10 will not affect the representations, warranties, covenants, agreements or obligations of the Parties (or remedies with respect thereto) or the conditions to the obligations of the Parties under this Agreement.

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(c)

The Parent and the Purchaser may not elect to exercise their right to terminate this Agreement pursuant to Section 9.2 and the Company may not elect to exercise its right to terminate this Agreement pursuant to Section 9.2, unless the Party seeking to terminate the Agreement (the “Terminating Party”) has delivered a written notice (“Termination Notice”) to the other Party (the “Breaching Party”) specifying in reasonable detail all breaches of covenants, representations and warranties or other matters which the Terminating Party asserts as the basis for termination. After delivering a Termination Notice, provided the Breaching Party is proceeding diligently to cure such matter and such matter is capable of being cured prior to the End Date, the Terminating Party may not exercise such termination right until the earlier of (a) the End Date, and (b) the date that is twenty (20) Business Days following receipt of such Termination Notice by the Breaching Party, if such matter has not been cured by such date. If the Terminating Party delivers a Termination Notice prior to the date of the Company Meeting or the Parent Meeting, if necessary, unless the Parties agree otherwise, the Company shall postpone or adjourn the Company Meeting, and the Parent shall postpone or adjourn the Parent Meeting, if necessary, to the earlier of (a) five (5) Business Days prior to the End Date and (b) the date that is twenty (20) Business Days following receipt of such Termination Notice by the Breaching Party.

(a)

From the Execution Date until the earlier of the Effective Time and the termination of this Agreement, subject to compliance with Applicable Laws, each Party will, and will direct their Affiliates and its and their respective Representatives, as applicable, to:

(i)

give the other Parties and their Representatives reasonable access to the offices, properties, books and records of such Party; and

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(ii)

furnish to the other Parties and their Representatives such financial and operating data and other information as such Persons may reasonably request.

(b)

Any investigation pursuant to this Section 7.12 will be conducted during normal business hours and in such manner as not to interfere unreasonably with the conduct of the business of the other Party or any Affiliate thereof, as the case may be.

(c)

From the Execution Date until the Effective Time, each Party will, and will direct their Affiliates and its and their respective Representatives, as applicable, to hold, in strict confidence, all data and information obtained from any other Party or from any Affiliate or Representative thereof, whether pertaining to the financial condition, assets, results of operations or method of operation thereof or otherwise, except any of the same which:

(i)

currently in the public domain;

(ii)

is required to be disclosed by any such Person in connection with any Proceeding before, or the regulatory requirements of, any Governmental Authority, or in connection with securing any consent required hereunder (provided that the disclosing Party, to the extent legally permissible, provides the other Party with reasonable prior notice of such disclosure); or

(iii)

becomes information generally available to the public other than through an act of a person bound by or subject to a confidentiality arrangement with the disclosing party;

(d)

Except with respect to the material terms and conditions of the Transaction, each Party covenants and agrees that neither it, nor any other Person acting on its behalf will provide the Noteholder or its agents or counsel with any information that constitutes, or such Party reasonably believes constitutes, material non-public information, unless prior thereto the Noteholder shall have consented to the receipt of such information and agreed with such Party to keep such information confidential.  To the extent that a Party delivers any material, non-public information to the Noteholder without the Noteholder’s consent, such Party hereby covenants and agrees that the Noteholder shall not have any duty of confidentiality to the Parties, any of their Subsidiaries or any of their respective officers, directors, agents, employees or Affiliates not to trade on the basis of, such material, non-public information, provided that the Noteholder shall remain subject to applicable law. To the extent that any notice provided pursuant to any Transaction Document constitutes, or contains, material, non-public information, the Party giving such notice shall simultaneously file, or cause to be filed, such notice pursuant to a Current Report on Form 8-K.  Each Party acknowledges and agrees that (i) the Noteholder shall be relying on the foregoing covenant in effecting transactions in securities of the Resulting Issuer and (ii) the Noteholder is not a party to any confidentiality agreement nor is it subject to any confidentiality obligations.  Parent shall on the trading day following the entry into this Amalgamation Agreement, file a Current Report on Form 8-K including the Transaction Documents as exhibits thereto with the SEC (“Signing Form 8-K”).  A form of the Signing Form 8-K is attached hereto as Exhibit C.  Such Exhibit C will be identical to the Signing Form 8-K which will be filed with the SEC except for the omission of signatures thereto.  From and after the filing of the Signing Form 8-K, Parent represents to Noteholder that Parent shall have publicly disclosed all material, non-public information delivered to Noteholder, or any of its officers, directors, employees or agents.  The requirements set forth in this Section 7.12(d) are made for the benefit of Noteholder and as an inducement to Noteholder to enter into a funding transaction with the Company.

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(a)

As promptly as reasonably practicable following the date of this Agreement, the Parent shall prepare and file with the SEC a proxy statement to be sent to the stockholders of each of the Parent and the Company relating to the meeting of the stockholders, as applicable, and a Registration Statement on Form S-4 (including a prospectus) (including all amendments thereto, “S-4 Registration Statement”) in connection with the issuance of shares of Resulting Issuer Capital Stock and Resulting Issuer Preferred Stock (or a newly filed S-8 Registration Statement, as applicable), of which such proxy statement will form a part (such proxy statement and prospectus constituting a part thereof, the “Proxy Statement/Prospectus”), and each of the Company and the Parent shall, or shall cause their respective Affiliates to, prepare and file with the SEC all other documents to be filed by the Parent with the SEC in connection with the Amalgamation and the other transactions contemplated hereby (the “Other Filings”) as required by the 1933 Act or the United States Exchange Act.  For the avoidance of doubt, all shares of Resulting Issuer Preferred Stock held by the Noteholder will be registered on the S-4 Registration Statement.  The Parent and the Company shall cooperate with each other in connection with the preparation of the S-4 Registration Statement, the Proxy Statement/Prospectus and any Other Filings.  Each Party shall as promptly as reasonably practicable notify the other Party of the receipt of any oral or written comments from the staff of the SEC on the S-4 Registration Statement or any Other Filing.  The Parent and the Company shall also use their reasonable commercially reasonable efforts to satisfy prior to the effective date of the S-4 Registration Statement all applicable Securities Laws or “blue sky” notice requirements in connection with the Amalgamation and to consummate the other transactions contemplated hereby.

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(b)

The Parent covenants and agrees that the S-4 Registration Statement and Proxy Statement/Prospectus, including any pro forma financial statements included therein (and the letter to stockholders, notice of meeting and form of proxy included therewith), will not, at the time that the S-4 Registration Statement and Proxy Statement/Prospectus or any amendment or supplement thereto is filed with the SEC or the Proxy Statement/Prospectus is first mailed to the Parent Stockholders, at the time of the Parent Meeting and at the Effective Time, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements made therein, in light of the circumstances under which they were made, not misleading. The Company represents, covenants and agrees that the information provided by the Company to the Parent for inclusion in the S-4 Registration Statement and Proxy Statement/Prospectus (including the Company Financial Statements) will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make such information not misleading. Notwithstanding the foregoing, the Parent makes no covenant, representation or warranty with respect to statements made in the S-4 Registration Statement or Proxy Statement/Prospectus (and the letter to stockholders, notice of meeting and form of proxy included therewith), if any, based on information furnished in writing by the Company specifically for inclusion therein.  Each of the Parties shall use commercially reasonable efforts to cause the S-4 Registration Statement and Proxy Statement/Prospectus to comply with the applicable rules and regulations promulgated by the SEC and to respond promptly to any comments of the SEC or its staff.  Each of the Parties shall use commercially reasonable efforts to cause the S-4 Registration Statement to be declared effective as soon as possible and the Proxy Statement/Prospectus to be mailed to Parent Stockholders as promptly as practicable after the SEC declares the S-4 Registration Statement to be effective. Each Party shall promptly furnish to the other Party all information concerning such Party, such Party’s Subsidiaries and such Party’s stockholders that may be required or reasonably requested in connection with any action contemplated by this Section 7.15. If any event relating to the Parent or the Company occurs, or if the Parent or the Company becomes aware of any information, that should be disclosed in an amendment or supplement to the S-4 Registration Statement and/or Proxy Statement/Prospectus, then the Parent or the Company, as applicable, shall promptly inform the other Party thereof and shall cooperate with one another in filing such amendment or supplement with the SEC and, if appropriate, in mailing such amendment or supplement to the Parent Stockholders. No filing of, or amendment or supplement to, the S-4 Registration Statement and/or Proxy Statement/Prospectus will be made by the Parent without the prior written consent of the Company, which consent shall not be unreasonably withheld, conditioned or delayed.

(c)

The Company shall reasonably cooperate with the Parent and provide, and require its Representatives, advisors, accountants and attorneys to provide, the Parent and its Representatives, advisors, accountants and attorneys, with all true, correct and complete information regarding the Company that is required by Applicable Law to be included in the S-4 Registration Statement and/or the Proxy Statement/Prospectus or reasonably requested from the Parent to be included in the S-4 Registration Statement and/or the Proxy Statement/Prospectus. The information provided by the Company to be included in the S-4 Registration Statement and/or the Proxy Statement/Prospectus shall not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements made therein, in light of the circumstances under which they were made, not misleading.

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(a)

Amalgamation Resolution.  The Amalgamation Resolution has been approved and adopted by the necessary Company Securityholders at the Company Meeting.

(b)

Parent Stockholder Approval.  The Parent Stockholder Approval shall have been obtained.

(c)

No Injunctions or Restraints; Illegality.  No temporary restraining order, preliminary or permanent injunction or other order (whether temporary, preliminary or permanent) issued by any court of competent jurisdiction or other legal restraint or prohibition preventing the consummation of the Amalgamation will be in effect, nor will any proceeding brought by any administrative agency or commission or other Governmental Authority or instrumentality, domestic or foreign, seeking any of the foregoing be pending. There will not be any action taken, or any statute, rule, regulation or order enacted, entered, enforced or deemed applicable to the Amalgamation, which makes the consummation of the Amalgamation illegal.

(d)

Regulatory Approvals.  Each required Regulatory Approval has been made, given or obtained and each such Regulatory Approval is in force and has not been modified. Any waiting period applicable to the consummation of the Amalgamation under any Regulatory Approval will have expired or been terminated.

(e)

Voting and Exchange Trust Agreement. Parent, ExchangeCo and the Trustee (as defined in the provisions governing the ExchangeCo Exchangeable Shares) shall have entered into the Voting and Exchange Trust Agreement.

(f)

Exchangeable Share Support Agreement. Parent and ExchangeCo shall have entered into the Exchangeable Share Support Agreement.

(g)

NASDAQ Listing Application.  The NASDAQ Listing Application shall have been approved, if such approval is required to maintain such listing following the consummation of the Amalgamation.

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(h)

Parent Legacy Business Disposition. The Parent shall have completed the Parent Legacy Business Disposition.

(i)

Parent Financing. The Parent shall have completed the Parent Financing.

(j)

Naming of Company Representative. Prior to the Effective Time, the identity and contact information of the Company Representative designated hereby shall be provided to the Parties, including the Parent Representative.

(a)

Representations and Warranties.

(i)

The representations and warranties of the Company (other than the Fundamental Representations) set forth in Article 4 shall be true and correct as of the Execution Date and the Closing Date as though made on and as of the Execution Date and the Closing Date (as applicable), except to the extent such representations and warranties speak as of an earlier date (which need only be true and correct as of such earlier date), in each case, except for inaccuracies that would not, individually or in the aggregate, have a Material Adverse Effect.

(ii)

The Fundamental Representations of the Company set forth in Article 4 shall be true and correct as of the Execution Date and the Closing Date as though made on and as of the Execution Date and the Closing Date, except for those Fundamental Representations which expressly relate to an earlier date (in which case such Fundamental Representations shall have been true and correct in all respects as of such earlier date).

(iii)

The Company has delivered a certificate confirming clauses (i) and (ii) above to the Parent and the Purchaser, executed by an officer of the Company (without personal liability) addressed to the Parent and the Purchaser and dated as of the Closing Date.

(b)

Performance of Covenants.  The Company has fulfilled or complied in all material respects with each of the covenants of the Company contained in this Agreement to be fulfilled or complied with by it on or prior to the Closing Date, and has delivered a certificate confirming same to the Parent and the Purchaser, executed by an officer of the Company (without personal liability) addressed to the Parent and the Purchaser and dated as of the Closing Date.

(c)

No Legal Action.  There is no action or proceeding (whether, for greater certainty, by a Governmental Authority or any other Person) pending or threatened in any jurisdiction to:

(i)

cease trade, enjoin, prohibit, or impose any limitations, damages or conditions on, the Purchaser’s ability to acquire, hold, or exercise full rights of ownership over, any Company Common Shares, including the right to vote the Company Common Shares;

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(ii)

prohibit, restrict or impose terms or conditions on, the Amalgamation, or the ownership or operation by the Parent and the Purchaser of the business or assets of the Parent, the Purchaser, the Company or their respective Subsidiaries, or compel the Parent or the Purchaser to dispose of or hold separate any of the business or assets of the Parent, the Purchaser, the Company or their respective Subsidiaries as a result of the Amalgamation; or

(iii)

prevent or materially delay the consummation of the Amalgamation, or if the Amalgamation were to be consummated, have a Material Adverse Effect with respect to the Company.

(d)

Material Adverse Effect.  There shall not have been or occurred a Material Adverse Effect with respect to the Company that has not been disclosed by the Company prior to the date hereof.

(e)

Officer’s Certificate.  The Parent shall have received a certificate executed by an officer of the Company (without personal liability) certifying as to (i) an attached copy of each of the Amalgamation Resolution and the Company Board Approval and stating neither the Amalgamation Resolution nor the Company Board Approval has been amended, modified, revoked or rescinded, (ii) the incumbency, authority and specimen signature of each officer of the Company executing this Agreement and (iii) true and complete attached copies of the Organizational Documents of the Company.

(f)

Allocation Certificate.  An officer of the Company will have executed and delivered to Parent at least two (2) Business Days prior to the Closing Date a certificate in a form reasonably acceptable to the Parent which sets forth (i) a true and complete list of the Company Securityholders immediately prior to the Effective Time and the number and type of Company Common Shares, Company Options or Company Warrants owned by each such Company Securityholder and (ii) the allocation of the Consideration among the Company Securityholders pursuant to the Amalgamation.

(g)

Lock-Up Agreements.  The Company shall have provided the Lock-Up Agreements executed by each of the parties described in Section 7.3(h) hereof.

(h)

Certificate of Good Standing.  The Company shall have provided the Parent a certificate of good standing (or equivalent) from the appropriate Governmental Authority of the jurisdiction of incorporation of the Company.

(i)

Consulting Agreement. Barry Kostiner and the Company shall have entered into a consulting agreement, to be effective as of the Closing, pursuant to which Barry Kostiner will serve as a consultant to the Company for a period of twelve (12) months following the Closing Date.

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(a)

Representations and Warranties.

(i)

The representations and warranties of the Parent, the Purchaser and ExchangeCo (other than the Fundamental Representations) set forth in Article 5 shall be true and correct as of the Execution Date and the Closing Date as though made on and as of the Execution Date and the Closing Date (as applicable), except to the extent such representations and warranties speak as of an earlier date (which need only be true and correct as of such earlier date), in each case, except for inaccuracies that would not, individually or in the aggregate, have a Material Adverse Effect.

(ii)

The Fundamental Representations of the Parent, the Purchaser and ExchangeCo set forth in Article 5 shall be true and correct as of the Closing Date as though made on and as of the Closing Date, except for those Fundamental Representations which expressly relate to an earlier date (in which case such Fundamental Representations shall have been true and correct in all respects as of such earlier date).

(iii)

The Parent (on behalf of itself and the Purchaser) has delivered a certificate confirming clauses (i) and (ii) above to the Company, executed by an officer of the Parent (without personal liability) addressed to the Company and dated as of the Closing Date.

(b)

Performance of Covenants.  Each of the Parent and the Purchaser has fulfilled or complied in all material respects with each of the covenants of the Parent and the Purchaser contained in this Agreement to be fulfilled or complied with by it on or prior to the Closing Date, and has delivered a certificate confirming same to the Company, executed by an officer of the Parent (without personal liability) addressed to the Company and dated as of the Closing Date.

(c)

Parent Liabilities. Parent shall have no outstanding material debts or liabilities of any kind (including, without limitation, unpaid Transaction expenses, leases, accounts payable or promissory notes) at the Effective Time.

(d)

Material Adverse Effect.  There shall not have been or occurred a Material Adverse Effect with respect to the Parent that has not been disclosed by the Parent prior to the date hereof.

(e)

Parent Board of Directors and Officer Resignation Letters.  Company will have received a duly executed copy of a resignation letter from each of the resigning members of the board of directors of Parent and each officer of Parent as contemplated by Section 7.5(i) and each of the Parent Subsidiaries, as applicable, pursuant to which each such Person will resign as a member of the board of directors of Parent immediately following the Effective Time.

(f)

Officer’s Certificate.  The Company shall have received a certificate executed by an officer of the Parent (without personal liability) certifying as to (i) an attached copy of each of the Parent Stockholder Approval Resolution and the Parent Board Approval and stating neither the Parent Stockholder Approval Resolution nor the Parent Board Approval has been amended, modified, revoked or rescinded, (ii) the incumbency, authority and specimen signature of each officer of the Parent executing this Agreement and (iii) true and complete attached copies of the Organizational Documents of the Parent and the Purchaser.

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(g)

Stock Split.  The Parent shall have completed the Stock Split, if it is deemed necessary.

(h)

Certificate of Good Standing.  The Parent and the Purchaser shall have provided the Company a certificate of good standing (or equivalent) from the appropriate Governmental Authority of the jurisdiction of incorporation or formation of the Parent and the Purchaser.

(i)

Parent Preferred Stock Conversion. The Parent shall have caused all Parent Preferred Stock to be converted into Parent Common Stock.

(j)

Incentive Stock Plan. The Purchaser shall have adopted the Resulting Issuer Incentive Stock Plan, to be effective as of the Closing.

(a)

This Agreement may be terminated prior to the Effective Time (provided, however, that (x) in each case the Noteholder’s prior written consent shall be a condition precedent to such termination and (y) if any of the conditions in this Section 9.2(a) are not met, the Company shall be required to pay, and the Noteholder shall be entitled to receive upon demand, the entire outstanding principal balance of the Note plus all accrued and unpaid interest thereon and any other sums payable to the Noteholder directly in connection with the Bridge Loan Financing) by:

(i)

the mutual written agreement of the Parties; or

(ii)

either the Company or the Purchaser if:

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(A)

the Parent Stockholder Approval Resolution is not approved by the requisite vote at the Parent Meeting provided that a Party may not terminate this Agreement pursuant to this Section 9.2(a)(ii)(A) if the failure to obtain the Parent Stockholder Approval has been caused by, or is a result of, a breach by such Party of any of its representations or warranties or the failure of such Party to perform any of its covenants or agreements under this Agreement;

(B)

the Amalgamation Resolution is not approved by the necessary Company Securityholders at the Company Meeting provided that a Party may not terminate this Agreement pursuant to this Section 9.2(a)(ii)(B) if the failure to obtain the approval of the necessary Company Securityholders has been caused by, or is a result of, a breach by such Party of any of its representations or warranties or the failure of such Party to perform any of its covenants or agreements under this Agreement;

(C)

after the date of this Agreement, any Applicable Law is enacted, made, enforced or amended, as applicable, that makes the consummation of the Amalgamation illegal or otherwise permanently prohibits or enjoins the Company, the Parent or the Purchaser from consummating the Amalgamation, and such Applicable Law has, if applicable, become final and non-appealable;

(D)

the Effective Time does not occur on or prior to the End Date, provided that a Party may not terminate this Agreement pursuant to this Section 9.2(a)(ii)(D) if the failure of the Effective Time to so occur has been caused by, or is a result of, a breach by such Party of any of its representations or warranties or the failure of such Party to perform any of its covenants or agreements under this Agreement, provided, however, in the event that the SEC has not concluded its review of the S-4 Registration Statement by the date which is sixty (60) days prior to the End Date, then either of Parent or the Company shall be entitled to extend the End Date for an additional sixty (60) days by providing written notice to the other party; or

(iii)

the Company if:

(A)

a breach of any representation or warranty or failure to perform any covenant or agreement on the part of the Parent or the Purchaser under this Agreement occurs that would cause any condition in Section 8.3(a) or Section 8.3(b) not to be satisfied, and such breach or failure is incapable of being cured on or prior to the End Date or is not cured in accordance with the terms of Section 7.10; provided that any willful breach shall be deemed to be incurable, and; provided, further that the Company is not then in breach of this Agreement so as to cause any condition in Section 8.2(a) or Section 8.2(b) not to be satisfied;

(1)

the Parent Board or any committee of the Parent Board fails to unanimously recommend or withdraws, amends, modifies or qualifies the Parent Board Approval, or publicly proposes or states its intention to do so (a “Parent Change in Recommendation”); or

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(2)

the Parent breaches Article 6 in any material respect;

(C)

there has occurred a Material Adverse Effect with respect to the Parent that has not been disclosed by the Parent prior to the date hereof;

(iv)

the Parent

(A)

in order to enter into a definitive agreement providing for a Superior Proposal in accordance with Section 6.1(e).

(B)

if a breach of any representation or warranty or failure to perform any covenant or agreement on the part of the Company under this Agreement occurs that would cause any condition in Section 8.2(a) or Section 8.2(b) not to be satisfied, and such breach or failure is incapable of being cured on or prior to the End Date or is not cured in accordance with the terms of Section 7.10; provided that any willful breach shall be deemed to be incurable, and; provided, further that the Parent is not then in breach of this Agreement so as to cause any condition in Section 8.3(a) or Section 8.3(b) not to be satisfied;

(1)

if the Company Board or any committee of the Company Board fails to unanimously recommend or withdraws, amends, modifies or qualifies the Company Board Approval, or publicly proposes or states its intention to do so (a “Company Change in Recommendation”); or

(2)

if the Company breaches Article 6 in any material respect; or

(D)

if there has occurred a Material Adverse Effect with respect to the Company that has not been publicly disclosed by the Company prior to the date hereof.

(b)

The Party desiring to terminate this Agreement pursuant to this Section 9.2 shall give notice of such termination to the other Party, specifying in reasonable detail the basis for such Party’s exercise of its termination right.

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(a)

The Parent, from and after the Closing Date and through the applicable Survival Period, will indemnify and hold harmless the Company Shareholders, the Noteholder and its officers, directors, agents or employees (collectively, the “Company Indemnified Parties”), and will reimburse the Company Indemnified Parties for any loss, liability, claim, damage, expense (including, but not limited to, costs of investigation and defense and reasonable attorneys’ fees) or diminution of value (collectively, “Damages”), whether or not involving a third party claim, arising from or in connection with:

(i)

any breach of any representation or warranty made by the Parent, Purchaser or ExchangeCo in (A) this Agreement or (B) any other certificate, document, writing or instrument executed and delivered;

(ii)

any breach of any covenant or obligation of the Parent, Purchaser or ExchangeCo in this Agreement or in any other certificate, document, writing or instrument executed and delivered by the Parent, Purchaser or ExchangeCo on or prior to the Closing Date pursuant to this Agreement;

(iii)

the operations and corporate governance of the Parent prior to the Closing, including, without limitation, its compliance (or lack of compliance) with Applicable Laws or the rules and regulations of any Governmental Authority;

(iv)

any debts, liabilities or other obligations of the Parent related to the business or activities of the Parent conducted prior to the Effective Time;

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(v)

Taxes attributable to any transaction or event occurring on or prior to the Closing Date;

(vi)

any litigation, action, claim, proceeding or investigation by any third party relating to or arising out of the business or operations of the Parent, or the actions of the Parent or any holder of Parent Capital Stock prior to the Effective Time; and/or

(vii)

any Proceedings pending or threatened in writing on or prior to the Closing Date against the Parent, Purchaser or ExchangeCo.

(a)

If, at any time on or prior to the expiration of the Survival Period, any of the Company Indemnified Parties shall assert a claim for indemnification pursuant to Section 10.2, the Company Representative (as defined below) on behalf of such Company Indemnified Party shall submit to the Parent, the Parent Representative, the Noteholder and Grushko & Mittman, P.C. (Attn: Edward Grushko) a written claim in good faith signed by the Company Representative stating (i) that a Company Indemnified Party incurred or reasonably believes it may incur Damages and the reasonable estimate of the amount of any such Damages; (ii) in reasonable detail, the facts alleged as the basis for such claim and the section or sections of this Agreement alleged as the basis or bases for the claim; and (iii) if the Damages have actually been incurred, the number of additional shares of Resulting Issuer Common Stock to which the Company Shareholders are entitled to with respect to such Damages, which shall be determined as provided in Section 10.4 below (each such written claim, an “Indemnification Statement”). If the claim is for Damages which the Company Representative, on behalf of the Company Indemnified Parties, reasonably believes may be incurred or are otherwise un-liquidated, the Indemnification Statement shall state the reasonable estimate of such Damages, in which event a claim shall be deemed to have been asserted under this Article 10 in the amount of such estimated Damages, but no distribution of additional shares of Resulting Issuer Common Stock to the Company Shareholders pursuant to Section 10.4 below shall be made until such Damages have actually been incurred.

(b)

If the Parent or the Parent Representative has any objections to an Indemnification Statement, then the Parent Representative shall deliver to the Company Representative a statement (an “Objection Statement”) setting forth its disputes or objections (the “Objection Disputes”) to the Indemnification Statement and, to the extent practical, the Parent Representative’s proposed resolution of each such Objection Dispute.  If an Objection Statement is not delivered to the Company Representative within thirty (30) days after receipt of the Indemnification Statement by the Parent Representative, then the Indemnification Statement as originally received by the Parent Representative shall be final, binding and non-appealable by the Parties.  If an Objection Statement is timely delivered, then the Parent Representative and the Company Representative shall negotiate in good faith to resolve any Objection Disputes, but if they do not reach a final resolution within thirty (30) days after the delivery of the Objection Statement, the Parent Representative and the Company Representative shall submit each unresolved Objection Dispute to a court of competent jurisdiction to resolve such Objection Disputes. The Party that is not the prevailing party shall pay all of the fees, costs and expenses associated with the resolution of any Objection Disputes that are submitted to a court of competent jurisdiction for resolution.

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	PARENT:
	AMERI HOLDINGS, INC.
	By:		/s/ Barry Kostiner
			Authorized Signing Officer
			Print Name: Barry Kostiner
	PURCHASER:
	JAY PHARMA MERGER SUB, INC.
	By:		/s/ Barry Kostiner
			Authorized Signing Officer
			Print Name: Barry Kostiner
	COMPANY:
	JAY PHARMA INC.
	By:		/s/ David Stefansky
			Authorized Signing Officer
			Print Name: David Stefansky
	EXCHANGECO:
	1236567 B.C. UNLIMITED LIABILITY COMPANY
	By:		/s/ Barry Kostiner
			Authorized Signing Officer
			Print Name: Barry Kostiner
	PARENT REPRESENTATIVE:
	/s/ Barry Kostiner
	BARRY KOSTINER

(Date)		(Signature of Shareholder)		(Guarantee of Signature)

(Registration / Name)

(Street Address or P.O. Box)

(City, Province/State, Country)

(Postal Code)

Signature of Shareholder		Signature Guaranteed by