UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
6-K
Report
of Foreign Private Issuer Pursuant to Rule 13a-16
or 15d-16 of the Securities Exchange Act of 1934
| For
the month of |
October
2023 |
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| Commission
File Number |
001-41460 |
Bruush
Oral Care Inc.
(Translation
of registrant’s name into English)
128
West Hastings Street, Unit 210
Vancouver,
British Columbia V6B 1G8
Canada
(844)
427-8774
(Address
of principal executive offices)
Indicate
by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:
Indicate
by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):
Indicate
by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):
INFORMATION
CONTAINED IN THIS FORM 6-K REPORT
On
October 2, 2023, Bruush Oral Care Inc. (the “Company”) entered into a private placement transaction (the “Private
Placement”), pursuant to a Securities Purchase Agreement (the “Agreement”) and a Registration Rights Agreement
(the “Registration Rights Agreement”) with an institutional investor (the “Purchaser”) for aggregate
gross proceeds of $5,010,000, before deducting fees to the placement agent and other expenses payable by the Company in connection
with the Private Placement. EF Hutton, division of Benchmark Investments, LLC (“EF Hutton”) acted as the exclusive
placement agent for the Private Placement, which closed on October 2, 2023.
As
part of the Private Placement, the Company will issue 79,724 common shares of the Company, a prefunded common share purchase warrant
(the “Prefunded Warrant”) to purchase 7,181,146 common shares of the Company, and a common share purchase warrant
(the “Warrant” and together with the Prefunded Warrant, the “Warrants”) to purchase 8,350,000 common shares
of the Company. The Warrants have a term of five years from the date of issuance.
To
secure performance of the Company’s obligations pursuant to the Agreement,
the Company executed a Confession of Judgment (the “Confession of Judgment”), whereby the Company confessed judgment
in favor of the Purchaser in an amount equal to the fair market value of the common shares of the Company that the Purchaser submitted
an exercise notice under either the Pre-Funded Warrant or the Warrant.
The
Company issued and sold the Warrant and Pre-Funded Warrant and shares of common stock issuable upon exercise of the Pre-Funded Warrant
and Warrants in reliance on the exemption from the registration requirements of the Securities Act of 1933, as amended (the “Securities
Act”) provided by Section 4(a)(2) thereof and Rule 506 thereunder. In connection with the Purchaser’s execution of the
Agreement, the Purchaser represented to us that they are each an “accredited investor” as defined in Regulation D of the
Securities Act and that the securities to be purchased by them will be acquired solely for their own account and not with a view to or
for distributing or reselling such securities or any part thereof in violation of the Securities Act or any applicable state securities
law. Such securities shall not be offered or sold in the United States absent registration or an applicable exemption from the registration
requirements and certificates evidencing such shares of common stock contain a legend stating the same.
The
descriptions of the Agreement, Registration Rights Agreement, Pre-Funded Warrant, Warrant, Confession of Judgment, Waiver set forth above
are qualified in their entirety by reference to the full text of those documents, which are attached hereto as Exhibits 10.1, 10.2, 10.3,
10.4 and 10.5, respectively.
On
October 2, 2023, the Company issued a press release announcing the pricing of the Private Placement. A copy of the press release is furnished
herewith as Exhibit 99.1 to this Report on Form 6-K.
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.
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Bruush
Oral Care Inc. |
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(Registrant) |
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| Date: |
October
6, 2023 |
|
By: |
/s/
Aneil Singh Manhas |
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Name: |
Aneil
Singh Manhas |
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Title: |
Chief
Executive Officer |
Exhibit 10.1
THE
PLACEMENT AGENT FOR THIS SECURITIES PURCHASE AGREEMENT IS EF HUTTON, A DIVISION OF BENCHMARK INVESTMENTS, LLC, A BROKER - DEALER REGISTERED
WITH THE U.S. SECURITIES AND EXCHANGE COMMISSION AND IS A MEMBER OF FINRA
THIS
AGREEMENT CONTAINS AN AFFIDAVIT OF CONFESSION OF JUDGMENT PROVISION WHICH CONSTITUTES A WAIVER OF IMPORTANT RIGHTS BORROWER MAY HAVE
AND ALLOWS THE INVESTOR TO OBTAIN A JUDGMENT AGAINST COMPANY WITHOUT ANY FURTHER NOTICE.
SECURITIES
PURCHASE AGREEMENT
This
SECURITIES PURCHASE AGREEMENT (the “Agreement”), dated as of October 2, 2023, by and between BRUUSH ORAL CARE,
INC., a corporation incorporated in British Columbia, Canada, with principal executive offices located at 128 West Hastings Street,
Unit 210 Vancouver, British Columbia V6B 1G8 (the “Company”), and _______, a company domiciled and registered
in Saint Kitts and Nevis (the “Buyer”). _______ is acting in association with Benchmark Investments, LLC. Benchmark
Investments, LLC. is the placement agent for this investment and is a broker - dealer registered with the United States Securities and
Exchange Commission and is a member of FINRA.
WHEREAS:
A. The
Company and the Buyer are executing and delivering this Agreement in reliance upon the exemption from securities registration afforded
by Section 4(a)(2) of the Securities Act of 1933, as amended (the “1933 Act”) and Rule 506(b) promulgated by the United States
Securities and Exchange Commission (the “SEC”) under the 1933 Act;
B. Buyer
desires to purchase from the Company, and the Company desires to issue and sell to the Buyer, upon the terms and conditions set forth
in this Agreement, 79,724 Common Shares (the “Shares”) and Warrant A and Warrant B (as defined below), upon the terms and
subject to the limitations and conditions set forth in this Agreement;
C. The
Buyer wishes to purchase the Shares upon the terms and conditions stated in this Agreement;
D. The
Company wishes to issue the Warrants (as defined below) to the Buyer as additional consideration for the purchase of the Shares, which
shall be earned in full as of the Closing Date, as further provided herein.
NOW
THEREFORE, in consideration of the foregoing and of the agreements and covenants herein contained, and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the Company and the Buyer hereby agree as follows:
1. Purchase and Sale of Shares.
a. Purchase
of Shares. On the Closing Date (as defined below), the Company shall issue and sell to the Buyer, and the Buyer agrees to purchase
from the Company, the Shares, as further provided herein. “Common Shares” shall mean the common shares of the Company, without
par value.
b. Form of Payment. On the Closing Date: (i) the Buyer shall pay the purchase price of
$8,350,000 (the “Purchase Price”) for the Shares, to be issued and sold to it at the Closing (as defined below), by
wire transfer of immediately available funds in accordance with written wiring instructions provided by the Company. On the Closing Date,
the Buyer shall withhold a non-accountable sum of a $15,000 legal fee from the Purchase Price to cover the Buyer’s legal fees in
connection with the transactions contemplated by this Agreement and an original issue discount of $3,340,000 (the “Transaction
Expense Amount”). The Transaction Expense Amount shall be offset against the Purchase Price.
c. Closing
Date. Subject to the satisfaction (or written waiver) of the conditions thereto set forth in Section 6 and Section 7 below, the date
and time of the issuance and sale of the Shares pursuant to this Agreement (the “Closing Date”) shall be on the date that
the Purchase Price for the Shares is paid by Buyer pursuant to terms of this Agreement.
d. Closing.
The closing of the transactions contemplated by this Agreement (the “Closing”) shall occur on the Closing Date in Saint Kitts
and Nevis (allowing for exchange of electronic signatures).
e. Warrants.
On or before the Closing Date, the Company shall issue a prefunded common share purchase warrant for the purchase of 7,181,146
shares of the Company’s common stock (“Warrant A”) and a common share purchase warrant for the purchase of 8,350,000
shares of the Company’s common shares (“Warrant B”), (Warrant A and Warrant B shall collectively be referred
to herein as the “Warrants”), to the Buyer pursuant to the terms of contained therein.
2. Buyer’s
Representations and Warranties. The Buyer represents and warrants to the Company as of the Closing Date that:
a. Investment
Purpose. As of the Closing Date, the Buyer is purchasing the Shares, the Warrants, such additional Common Shares, if any, as are
issuable pursuant to this Agreement, and such Common Shares issuable upon exercise of the Warrants (the “Warrant Shares”)
(collectively referred to herein as the “Securities”) for its own account and not with a present view towards the public
sale or distribution thereof, except pursuant to sales registered or exempted from registration under the 1933 Act; provided,
however, that by making the representations herein, the Buyer does not agree to hold any of the Securities for any minimum or
other specific term and reserves the right to dispose of the Securities at any time in accordance with or pursuant to a registration
statement or an exemption under the 1933 Act.
b. Accredited
Investor Status. The Buyer is an “accredited investor” as that term is defined in Rule 501(a) of Regulation D (an “Accredited
Investor”).
c. Reliance
on Exemptions. The Buyer understands that the Securities are being offered and sold to it in reliance upon specific exemptions from
the registration requirements of United States federal and state securities laws and that the Company is relying upon the truth and accuracy
of, and the Buyer’s compliance with, the representations, warranties, agreements, acknowledgments and understandings of the Buyer
set forth herein in order to determine the availability of such exemptions and the eligibility of the Buyer to acquire the Securities.
d. Information.
The Buyer and its advisors, if any, have been, furnished with all materials relating to the business, finances and operations of
the Company and materials relating to the offer and sale of the Securities which have been requested by the Buyer or its advisors. The
Buyer and its advisors, if any, have been, afforded the opportunity to ask questions of the Company regarding its business and affairs.
Notwithstanding the foregoing, the Company has not disclosed to the Buyer any material nonpublic information regarding the Company or
otherwise and will not disclose such information unless such information is disclosed to the public prior to or promptly following such
disclosure to the Buyer. Neither such inquiries nor any other due diligence investigation conducted by Buyer or any of its advisors or
representatives shall modify, amend or affect Buyer’s right to rely on the Company’s representations and warranties contained
in Section 3 below.
e. Governmental
Review. The Buyer understands that no United States federal or state agency or any other government or governmental agency has passed
upon or made any recommendation or endorsement of the Securities.
f. Transfer
or Re-sale. The Buyer understands that (i) the sale or resale of the Securities has not been and is not being registered under
the 1933 Act or any applicable state securities laws, and the Securities may not be transferred unless (a) the Securities are sold
pursuant to an effective registration statement under the 1933 Act, (b) the Buyer shall have delivered to the Company, at the
cost of the Company, an opinion of counsel (which may be the Legal Counsel Opinion (as defined below)) that shall be in form,
substance and scope customary for opinions of counsel in comparable transactions to the effect that the Securities to be sold or
transferred may be sold or transferred pursuant to an exemption from such registration, which opinion shall be accepted by the
Company, (c) the Securities are sold or transferred to an “affiliate” (as defined in Rule 144 promulgated under the 1933
Act (or a successor rule) (“Rule 144”)) of the Buyer who agrees to sell or otherwise transfer the Securities only in
accordance with this Section 2(f) and who is an Accredited Investor, (d) the Securities are sold pursuant to Rule 144 or other
applicable exemption, or (e) the Securities are sold pursuant to Regulation S under the 1933 Act (or a successor rule)
(“Regulation S”), and the Buyer shall have delivered to the Company, at the cost of the Company, an opinion of counsel
that shall be in form, substance and scope customary for opinions of counsel in corporate transactions, which opinion shall be
accepted by the Company; (ii) any sale of such Securities made in reliance on Rule 144 may be made only in accordance with the terms
of said Rule and further, if said Rule is not applicable, any re-sale of such Securities under circumstances in which the seller (or
the person through whom the sale is made) may be deemed to be an underwriter (as that term is defined in the 1933 Act) may require
compliance with some other exemption under the 1933 Act or the rules and regulations of the SEC thereunder; and (iii) neither the
Company nor any other person is under any obligation to register such Securities under the 1933 Act or any state securities laws or
to comply with the terms and conditions of any exemption thereunder (in each case). Notwithstanding the foregoing or anything else
contained herein to the contrary, the Securities may be pledged in connection with a bona fide margin account or other
lending arrangement secured by the Securities, and such pledge of Securities shall not be deemed to be a transfer, sale or
assignment of the Securities hereunder, and the Buyer in effecting such pledge of Securities shall be not required to provide the
Company with any notice thereof or otherwise make any delivery to the Company pursuant to this Agreement or otherwise.
g. Legends. The
Buyer understands that until such time as the Shares, Warrants, and, upon exercise of the Warrants in accordance with its respective
terms, the Warrant Shares, have been registered under the 1933 Act or may be sold pursuant to Rule 144, Rule 144A under the 1933
Act, Regulation S, or other applicable exemption without any restriction as to the number of securities as of a particular date that
can then be immediately sold, the Securities may bear a restrictive legend in substantially the following form (and a stop-transfer
order may be placed against transfer of such Securities):
“NEITHER
THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE EXERCISABLE
HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED
FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL (WHICH COUNSEL SHALL BE SELECTED BY THE HOLDER), IN A GENERALLY ACCEPTABLE FORM,
THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO RULE 144, RULE 144A, REGULATION S, OR OTHER APPLICABLE
EXEMPTION UNDER SAID ACT. NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT
OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE SECURITIES.”
The
legend set forth above shall be removed and the Company shall issue a certificate or book entry statement for the applicable Common Shares
without such legend to the holder of any Security upon which it is stamped or (as requested by such holder) issue the applicable Common
Shares to such holder by electronic delivery by crediting the account of such holder’s broker with The Depository Trust Company
(“DTC”), if, unless otherwise required by applicable state securities laws, (a) such Security is registered for sale
under an effective registration statement filed under the 1933 Act or otherwise may be sold pursuant to Rule 144, Rule 144A, Regulation
S, or other applicable exemption without any restriction as to the number of securities as of a particular date that can then be immediately
sold, or (b) the Company or the Buyer provides the Legal Counsel Opinion (as contemplated by and in accordance with Section 4(m) hereof)
to the effect that a public sale or transfer of such Security may be made without registration under the 1933 Act, which opinion shall
be accepted by the Company so that the sale or transfer is effected. The Company shall be responsible for the fees of its transfer agent
and all DTC fees associated with any such issuance. The Buyer agrees to sell all Securities, including those represented by a certificate(s)
from which the legend has been removed, in compliance with applicable prospectus delivery requirements, if any.
Authorization;
Enforcement. This Agreement has been duly and validly authorized by the Buyer and has been duly executed and delivered on behalf
of the Buyer, and this Agreement constitutes and binding agreement of the Buyer enforceable in accordance with its terms, except as enforcement
may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting creditors’ rights generally
and except as may be limited by the exercise of judicial discretion in applying principles of equity.
3. Representations
and Warranties of the Company. The Company represents and warrants to the Buyer as of the Closing Date that:
a. Organization
and Qualification. The Company and each of its Subsidiaries (as defined below), if any, is a corporation duly organized, validly
existing and in good standing under the laws of the jurisdiction in which it is incorporated, with full power and authority (corporate
and other) to own, lease, use and operate its properties and to carry on its business as and where now owned, leased, used, operated
and conducted. Schedule 3(a), if attached hereto, sets forth a list of all of the Subsidiaries of the Company and the jurisdiction in
which each is incorporated. The Company and each of its Subsidiaries is duly qualified as a foreign corporation to do business and is
in good standing in every jurisdiction in which its ownership or use of property or the nature of the business conducted by it makes
such qualification necessary except where the failure to be so qualified or in good standing would not have a Material Adverse Effect.
“Material Adverse Effect” means any material adverse effect on the business, operations, assets, financial condition or prospects
of the Company or its Subsidiaries, if any, taken as a whole, or on the transactions contemplated hereby or by the agreements or instruments
to be entered into in connection herewith. “Subsidiaries” means any corporation or other organization, whether incorporated
or unincorporated, in which the Company owns, directly or indirectly, any equity or other ownership interest.
b. Authorization;
Enforcement. (i) The Company has all requisite corporate power and authority to enter into and perform this Agreement and to consummate
the transactions contemplated hereby and thereby and to issue the Securities, in accordance with the terms hereof and thereof, (ii) the
execution and delivery of this Agreement, the Warrants, the Shares, and the Warrant Shares by the Company and the consummation by it
of the transactions contemplated hereby and thereby (including without limitation, the issuance of the Shares, Warrants, as well as the
issuance and reservation for issuance of the Warrant Shares issuable upon exercise of the Warrants) have been duly authorized by the
Company’s Board of Directors and no further consent or authorization of the Company, its Board of Directors, its shareholders,
or its debt holders is required, (iii) this Agreement, the Warrants, and all other documentation executed in connection herewith or therewith
have been duly executed and delivered by the Company by its authorized representative, and such authorized representative is the true
and official representative with authority to sign this Agreement, the Warrants, and all other documentation executed in connection herewith
or therewith and bind the Company accordingly, and (iv) this Agreement constitutes, and upon execution and delivery by the Company of
the Warrants, each of such instruments will constitute, a legal, valid and binding obligation of the Company, enforceable against the
Company in accordance with their terms.
c. Capitalization;
Governing Documents. As of September 25, 2023, the authorized capital stock of the Company consists of: unlimited authorized Common
Shares, of which 1,594,492 shares were issued and outstanding, and unlimited authorized shares of preferred stock, of which zero shares
were issued and outstanding. All of such outstanding shares of capital stock of the Company and the Warrant Shares, are, or upon issuance
will be, duly authorized, validly issued, fully paid and non-assessable. No shares of capital stock of the Company are subject to preemptive
rights or any other similar rights of the shareholders of the Company or any liens or encumbrances imposed through the actions or failure
to act of the Company. As of the effective date of this Agreement, other than as publicly announced prior to such date and reflected
in the SEC filings of the Company (i) there are no outstanding options, warrants, scrip, rights to subscribe for, puts, calls, rights
of first refusal, agreements, understandings, claims or other commitments or rights of any character whatsoever relating to, or securities
or rights convertible into or exchangeable for any shares of capital stock of the Company or any of its Subsidiaries, or arrangements
by which the Company or any of its Subsidiaries is or may become bound to issue additional shares of capital stock of the Company or
any of its Subsidiaries, (ii) there are no agreements or arrangements under which the Company or any of its Subsidiaries is obligated
to register the sale of any of its or their securities under the 1933 Act and (iii) there are no anti-dilution or price adjustment provisions
contained in any security issued by the Company (or in any agreement providing rights to security holders) that will be triggered by
the issuance of any of the Securities. The Company has furnished to the Buyer true and correct copies of the Company’s Articles
of Incorporation as in effect on the date hereof (“Articles of Incorporation”), the Company’s By-laws, as in effect
on the date hereof (the “By-laws”), and the terms of all securities convertible into or exercisable for Common Shares of
the Company and the material rights of the holders thereof in respect thereto.
d. Issuance
of Warrant Shares. The Warrant Shares are duly authorized and reserved for issuance and, upon exercise of the Warrants in accordance
with its terms, will be validly issued, fully paid and non-assessable, and free from all taxes, liens, claims and encumbrances with respect
to the issue thereof and shall not be subject to preemptive rights or other similar rights of shareholders of the Company and will not
impose personal liability upon the holder thereof.
e. Issuance
of Warrants. The issuance of the Warrants are duly authorized and will be validly issued, fully paid and non-assessable, and free
from all taxes, liens, claims and encumbrances with respect to the issue thereof and shall not be subject to preemptive rights or other
similar rights of shareholders of the Company and will not impose personal liability upon the holder thereof.
f. Acknowledgment
of Dilution. The Company understands and acknowledges the potentially dilutive effect of the Warrant Shares to the Common Shares
upon the exercise of the Warrants. The Company further acknowledges that its obligation to issue the Warrant Shares in accordance with
this Agreement and the Warrants is absolute and unconditional regardless of the dilutive effect that such issuance may have on the ownership
interests of other shareholders of the Company.
g. No
Conflicts. The execution, delivery and performance of this Agreement and the Warrants by the Company and the consummation by the
Company of the transactions contemplated hereby and thereby (including, without limitation, the issuance and reservation for issuance
of the Warrant Shares) will not (i) conflict with or result in a violation of any provision of the Articles of Incorporation or By-laws,
or (ii) violate or conflict with, or result in a breach of any provision of, or constitute a default (or an event which with notice or
lapse of time or both could become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation
of, any agreement, note, evidence of indebtedness, indenture, patent, patent license or instrument to which the Company or any of its
Subsidiaries is a party, or (iii) result in a violation of any law, rule, regulation, order, judgment or decree (including federal and
state securities laws and regulations and regulations of any self-regulatory organizations to which the Company or its securities is
subject) applicable to the Company or any of its Subsidiaries or by which any property or asset of the Company or any of its Subsidiaries
is bound or affected (except for such conflicts, defaults, terminations, amendments, accelerations, cancellations and violations as would
not, individually or in the aggregate, have a Material Adverse Effect), or (iv) other than as publicly announced prior to such date and
reflected in the SEC filings of the Company, trigger any anti-dilution and/or ratchet provision contained in any other contract in which
the Company is a party thereto or any security issued by the Company. Neither the Company nor any of its Subsidiaries is in violation
of its Articles of Incorporation, By-laws or other organizational documents and neither the Company nor any of its Subsidiaries is in
default (and no event has occurred which with notice or lapse of time or both could put the Company or any of its Subsidiaries in default)
under, and neither the Company nor any of its Subsidiaries has taken any action or failed to take any action that would give to others
any rights of termination, amendment, acceleration or cancellation of, any agreement, indenture or instrument to which the Company or
any of its Subsidiaries is a party or by which any property or assets of the Company or any of its Subsidiaries is bound or affected,
except for possible defaults as would not, individually or in the aggregate, have a Material Adverse Effect. The businesses of the Company
and its Subsidiaries, if any, are not being conducted, and shall not be conducted so long as the Buyer owns any of the Securities, in
violation of any law, ordinance or regulation of any governmental entity. Except as specifically contemplated by this Agreement and as
required under the 1933 Act and any applicable state securities laws, the Company is not required to obtain any consent, authorization
or order of, or make any filing or registration with, any court, governmental agency, regulatory agency, self-regulatory organization
or stock market or any third party in order for it to execute, deliver or perform any of its obligations under this Agreement and the
Warrants in accordance with the terms hereof or thereof or to issue and sell the Shares in accordance with the terms hereof and, upon
exercise of the Warrants, issue Warrant Shares. All consents, authorizations, orders, filings and registrations which the Company is
required to obtain pursuant to the preceding sentence have been obtained or effected on or prior to the date hereof. The “Principal
Market” shall mean any tier of the OTC Markets, any tier of the NASDAQ Stock Market (including NASDAQ Capital Market), or the NYSE
American, or any successor to such markets.
h. SEC
Documents; Financial Statements. The Company has filed all reports, schedules, forms, statements and other documents required to
be filed by it with the SEC pursuant to the reporting requirements of the Securities Exchange Act of 1934, as amended (the “1934
Act”) (all of the foregoing filed prior to the date hereof and all exhibits included therein and financial statements and schedules
thereto and documents (other than exhibits to such documents) incorporated by reference therein, being hereinafter referred to herein
as the “SEC Documents”). As of their respective dates, the SEC Documents complied in all material respects with the requirements
of the 1934 Act and the rules and regulations of the SEC promulgated thereunder applicable to the SEC Documents, and none of the SEC
Documents, at the time they were filed with the SEC, contained any untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they
were made, not misleading. None of the statements made in any such SEC Documents is, or has been, required to be amended or updated under
applicable law (except for such statements as have been amended or updated in subsequent filings prior the date hereof). As of their
respective dates, the financial statements of the Company included in the SEC Documents complied as to form in all material respects
with applicable accounting requirements and the published rules and regulations of the SEC with respect thereto. Such financial statements
have been prepared in accordance with United States generally accepted accounting principles, consistently applied, during the periods
involved and fairly present in all material respects the consolidated financial position of the Company and its consolidated Subsidiaries
as of the dates thereof and the consolidated results of their operations and cash flows for the periods then ended (subject, in the case
of unaudited statements, to normal year-end audit adjustments). Except as set forth in the financial statements of the Company included
in the SEC Documents, the Company has no liabilities, contingent or otherwise, other than (i) liabilities incurred in the ordinary course
of business subsequent to September 14, 2023, and (ii) obligations under contracts and commitments incurred in the ordinary course of
business and not required under generally accepted accounting principles to be reflected in such financial statements, which, individually
or in the aggregate, are not material to the financial condition or operating results of the Company. The Company is subject to the reporting
requirements of the 1934 Act. The Company has never been a “shell company” as described in Rule 144(i)(1)(i).
i. Absence
of Certain Changes. Since September 14, 2023, there has been no material adverse change and no material adverse development in the
assets, liabilities, business, properties, operations, financial condition, results of operations, prospects or 1934 Act reporting status
of the Company or any of its Subsidiaries.
j. Absence
of Litigation. There is no action, suit, claim, proceeding, inquiry or investigation before or by any court, public board, government
agency, self-regulatory organization or body pending or, to the knowledge of the Company or any of its Subsidiaries, threatened against
or affecting the Company or any of its Subsidiaries, or their officers or directors in their capacity as such, that could have a Material
Adverse Effect. The SEC Documents contain a complete list and summary description of any pending or, to the knowledge of the Company,
threatened proceeding against or affecting the Company or any of its Subsidiaries, without regard to whether it would have a Material
Adverse Effect. The Company and its Subsidiaries are unaware of any facts or circumstances which might give rise to any of the foregoing.
k. Intellectual
Property. The Company and each of its Subsidiaries owns or possesses the requisite licenses or rights to use all patents, patent
applications, patent rights, inventions, know-how, trade secrets, trademarks, trademark applications, service marks, service names, trade
names and copyrights (“Intellectual Property”) necessary to enable it to conduct its business as now operated (and, as presently
contemplated to be operated in the future); there is no claim or action by any person pertaining to, or proceeding pending, or to the
Company’s knowledge threatened, which challenges the right of the Company or of a Subsidiary with respect to any Intellectual Property
necessary to enable it to conduct its business as now operated (and, as presently contemplated to be operated in the future); to the
best of the Company’s knowledge, the Company’s or its Subsidiaries’ current and intended products, services and processes
do not infringe on any Intellectual Property or other rights held by any person; and the Company is unaware of any facts or circumstances
which might give rise to any of the foregoing. The Company and each of its Subsidiaries have taken reasonable security measures to protect
the secrecy, confidentiality and value of their Intellectual Property.
l. No
Materially Adverse Contracts, Etc. Neither the Company nor any of its Subsidiaries is subject to any charter, corporate or other
legal restriction, or any judgment, decree, order, rule or regulation which in the judgment of the Company’s officers has or is
expected in the future to have a Material Adverse Effect. Neither the Company nor any of its Subsidiaries is a party to any contract
or agreement which in the judgment of the Company’s officers has or is expected to have a Material Adverse Effect.
m. Tax
Status. The Company and each of its Subsidiaries has made or filed all federal, state and foreign income and all other tax returns,
reports and declarations required by any jurisdiction to which it is subject (unless and only to the extent that the Company and each
of its Subsidiaries has set aside on its books provisions reasonably adequate for the payment of all unpaid and unreported taxes) and
has paid all taxes and other governmental assessments and charges that are material in amount, shown or determined to be due on such
returns, reports and declarations, except those being contested in good faith and has set aside on its books provisions reasonably adequate
for the payment of all taxes for periods subsequent to the periods to which such returns, reports or declarations apply. There are no
unpaid taxes in any material amount claimed to be due by the taxing authority of any jurisdiction, and the officers of the Company know
of no basis for any such claim. The Company has not executed a waiver with respect to the statute of limitations relating to the assessment
or collection of any foreign, federal, state or local tax. None of the Company’s tax returns is presently being audited by any
taxing authority.
n. Transactions
with Affiliates. Except for arm’s length transactions pursuant to which the Company or any of its Subsidiaries makes payments
in the ordinary course of business upon terms no less favorable than the Company or any of its Subsidiaries could obtain from third parties
and other than the grant of stock options described in the SEC Documents, none of the officers, directors, or employees of the Company
is presently a party to any transaction with the Company or any of its Subsidiaries (other than for services as employees, officers and
directors), including any contract, agreement or other arrangement providing for the furnishing of services to or by, providing for rental
of real or personal property to or from, or otherwise requiring payments to or from any officer, director or such employee or, to the
knowledge of the Company, any corporation, partnership, trust or other entity in which any officer, director, or any such employee has
a substantial interest or is an officer, director, trustee or partner.
o. Disclosure.
All information relating to or concerning the Company or any of its Subsidiaries set forth in this Agreement and provided to the
Buyer pursuant to Section 2(d) hereof and otherwise in connection with the transactions contemplated hereby is true and correct in all
material respects and the Company has not omitted to state any material fact necessary in order to make the statements made herein or
therein, in light of the circumstances under which they were made, not misleading. No event or circumstance has occurred or exists with
respect to the Company or any of its Subsidiaries or its or their business, properties, prospects, operations or financial conditions,
which, under applicable law, rule or regulation, requires public disclosure or announcement by the Company but which has not been so
publicly announced or disclosed (assuming for this purpose that the Company’s reports filed under the 1934 Act are being incorporated
into an effective registration statement filed by the Company under the 1933 Act).
p. Acknowledgment
Regarding Buyer’s Purchase of Securities. The Company acknowledges and agrees that the Buyer is acting solely in the capacity
of arm’s length purchaser with respect to this Agreement and the transactions contemplated hereby. The Company further acknowledges
that the Buyer is not acting as a financial advisor or fiduciary of the Company (or in any similar capacity) with respect to this Agreement
and the transactions contemplated hereby and any statement made by the Buyer or any of its respective representatives or agents in connection
with this Agreement and the transactions contemplated hereby is not advice or a recommendation and is merely incidental to the Buyer’s
purchase of the Securities. The Company further represents to the Buyer that the Company’s decision to enter into this Agreement
has been based solely on the independent evaluation of the Company and its representatives.
q. No
Integrated Offering. Neither the Company, nor any of its affiliates, nor any person acting on its or their behalf, has directly
or indirectly made any offers or sales in any security or solicited any offers to buy any security under circumstances that would
require registration under the 1933 Act of the issuance of the Securities to the Buyer. The issuance of the Securities to the Buyer
will not be integrated with any other issuance of the Company’s securities (past, current or future) for purposes of any
shareholder approval provisions applicable to the Company or its securities.
r. No
Brokers; No Solicitation. Other than it’s relationship with Benchmark Investments, LLC, the Company has taken no action which
would give rise to any claim by any person for brokerage commissions, transaction fees or similar payments relating to this Agreement
or the transactions contemplated hereby. The Company acknowledges and agrees that neither the Buyer nor its employee(s), member(s), beneficial
owner(s), or partner(s) solicited the Company to enter into this Agreement and consummate the transactions described in this Agreement.
s. Permits;
Compliance. The Company and each of its Subsidiaries is in possession of all franchises, grants, authorizations, licenses, permits,
easements, variances, exemptions, consents, certificates, approvals and orders necessary to own, lease and operate its properties and
to carry on its business as it is now being conducted (collectively, the “Company Permits”), and there is no action pending
or, to the knowledge of the Company, threatened regarding suspension or cancellation of any of the Company Permits. Neither the Company
nor any of its Subsidiaries is in conflict with, or in default or violation of, any of the Company Permits, except for any such conflicts,
defaults or violations which, individually or in the aggregate, would not reasonably be expected to have a Material Adverse Effect. Since
September 14, 2023, neither the Company nor any of its Subsidiaries has received any notification with respect to possible conflicts,
defaults or violations of applicable laws, except for notices relating to possible conflicts, defaults or violations, which conflicts,
defaults or violations would not have a Material Adverse Effect.
t.
Environmental Matters.
(i) There
are, to the Company’s knowledge, with respect to the Company or any of its Subsidiaries or any predecessor of the Company, no past
or present violations of Environmental Laws (as defined below), releases of any material into the environment, actions, activities, circumstances,
conditions, events, incidents, or contractual obligations which may give rise to any common law environmental liability or any liability
under the Comprehensive Environmental Response, Compensation and Liability Act of 1980 or similar federal, state, local or foreign laws
and neither the Company nor any of its Subsidiaries has received any notice with respect to any of the foregoing, nor is any action pending
or, to the Company’s knowledge, threatened in connection with any of the foregoing. The term “Environmental Laws” means
all federal, state, local or foreign laws relating to pollution or protection of human health or the environment (including, without
limitation, ambient air, surface water, groundwater, land surface or subsurface strata), including, without limitation, laws relating
to emissions, discharges, releases or threatened releases of chemicals, pollutants contaminants, or toxic or hazardous substances or
wastes (collectively, “Hazardous Materials”) into the environment, or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling of Hazardous Materials, as well as all authorizations, codes,
decrees, demands or demand letters, injunctions, judgments, licenses, notices or notice letters, orders, permits, plans or regulations
issued, entered, promulgated or approved thereunder.
(ii) Other
than those that are or were stored, used or disposed of in compliance with applicable law, no Hazardous Materials are contained on or
about any real property currently owned, leased or used by the Company or any of its Subsidiaries, and no Hazardous Materials were released
on or about any real property previously owned, leased or used by the Company or any of its Subsidiaries during the period the property
was owned, leased or used by the Company or any of its Subsidiaries, except in the normal course of the Company’s or any of its
Subsidiaries’ business.
(iii) There
are no underground storage tanks on or under any real property owned, leased or used by the Company or any of its Subsidiaries that are
not in compliance with applicable law.
u. Title
to Property. The Company and its Subsidiaries have good and marketable title in fee simple to all real property and good and
marketable title to all personal property owned by them which is material to the business of the Company and its Subsidiaries, in
each case free and clear of all liens, encumbrances and defects except such as are described in Schedule 3(u), if attached hereto,
or such as would not have a Material Adverse Effect. Any real property and facilities held under lease by the Company and its
Subsidiaries are held by them under valid, subsisting and enforceable leases with such exceptions as would not have a Material
Adverse Effect.
v. Insurance.
The Company and each of its Subsidiaries are insured by insurers of recognized financial responsibility against such losses and risks
and in such amounts as management of the Company believes to be prudent and customary in the businesses in which the Company and its
Subsidiaries are engaged. Neither the Company nor any such Subsidiary has any reason to believe that it will not be able to renew its
existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary
to continue its business at a cost that would not have a Material Adverse Effect. Upon written request the Company will provide to the
Buyer true and correct copies of all policies relating to directors’ and officers’ liability coverage, errors and omissions
coverage, and commercial general liability coverage.
w. Internal
Accounting Controls. The Company and each of its Subsidiaries maintain a system of internal accounting controls sufficient, in the
judgment of the Company’s board of directors, to provide reasonable assurance that (i) transactions are executed in accordance
with management’s general or specific authorizations, (ii) transactions are recorded as necessary to permit preparation of financial
statements in conformity with generally accepted accounting principles and to maintain asset accountability, (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 the existing assets at reasonable intervals and appropriate action is taken with respect to any differences.
x. Foreign
Corrupt Practices. Neither the Company, nor any of its Subsidiaries, nor any director, officer, agent, employee or other person acting
on behalf of the Company or any Subsidiary has, in the course of his actions for, or on behalf of, the Company, used any corporate funds
for any unlawful contribution, gift, entertainment or other unlawful expenses relating to political activity; made any direct or indirect
unlawful payment to any foreign or domestic government official or employee from corporate funds; violated or is in violation of any
provision of the U.S. Foreign Corrupt Practices Act of 1977, as amended, or made any bribe, rebate, payoff, influence payment, kickback
or other unlawful payment to any foreign or domestic government official or employee.
y. Solvency.
The Company (after giving effect to the transactions contemplated by this Agreement) is solvent (i.e., its assets have a fair
market value in excess of the amount required to pay its probable liabilities on its existing debts as they become absolute and matured)
and currently the Company has no information that would lead it to reasonably conclude that the Company would not, after giving effect
to the transaction contemplated by this Agreement, have the ability to, nor does it intend to take any action that would impair its ability
to, pay its debts from time to time incurred in connection therewith as such debts mature. The Company’s financial statements for
its most recent fiscal year end and interim financial statements have been prepared assuming the Company will continue as a going concern,
which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.
z. No
Investment Company. The Company is not, and upon the issuance and sale of the Securities as contemplated by this Agreement will not
be an “investment company” required to be registered under the Investment Company Act of 1940 (an “Investment Company”).
The Company is not controlled by an Investment Company.
aa.
No Off Balance Sheet Arrangements. There is no transaction, arrangement, or other relationship between the Company or any of its
Subsidiaries and an unconsolidated or other off balance sheet entity that is required to be disclosed by the Company in its 1934 Act
filings and is not so disclosed or that otherwise could be reasonably likely to have a Material Adverse Effect.
bb. No
Disqualification Events. None of the Company, any of its predecessors, any affiliated issuer, any director, executive officer,
other officer of the Company participating in the offering hereunder, any beneficial owner of 20% or more of the Company’s
outstanding voting equity securities, calculated on the basis of voting power, nor any promoter (as that term is defined in Rule 405
under the 1933 Act) connected with the Company in any capacity at the time of sale (each, an “Issuer Covered Person”) is
subject to any of the “Bad Actor” disqualifications described in Rule 506(d)(1)(i) to (viii) under the 1933 Act (a
“Disqualification Event”), except for a Disqualification Event covered by Rule 506(d)(2) or (d)(3). The Company has
exercised reasonable care to determine whether any Issuer Covered Person is subject to a Disqualification Event.
cc.
Manipulation of Price. The Company has not, and to its knowledge no one acting on its behalf has: (i) taken, directly or indirectly,
any action designed to cause or to result, or that could reasonably be expected to cause or result, in the stabilization or manipulation
of the price of any security of the Company to facilitate the sale or resale of any of the Securities, (ii) sold, bid for, purchased,
or paid any compensation for soliciting purchases of, any of the Securities, or (iii) paid or agreed to pay to any person any compensation
for soliciting another to purchase any other securities of the Company.
dd.
Bank Holding Company Act. Neither the Company nor any of its Subsidiaries is subject to the Bank Holding Company Act of 1956,
as amended (the “BHCA”) and to regulation by the Board of Governors of the Federal Reserve System (the “Federal Reserve”).
Neither the Company nor any of its Subsidiaries or affiliates owns or controls, directly or indirectly, five percent (5%) or more of
the outstanding shares of any class of voting securities or twenty-five percent (25%) or more of the total equity of a bank or any entity
that is subject to the BHCA and to regulation by the Federal Reserve. Neither the Company nor any of its Subsidiaries or affiliates exercises
a controlling influence over the management or policies of a bank or any entity that is subject to the BHCA and to regulation by the
Federal Reserve.
ee.
Illegal or Unauthorized Payments; Political Contributions. Neither the Company nor any of its Subsidiaries nor, to the Company’s
knowledge, any of the officers, directors, employees, agents or other representatives of the Company or any of its Subsidiaries or any
other business entity or enterprise with which the Company or any Subsidiary is or has been affiliated or associated, has, directly or
indirectly, made or authorized any payment, contribution or gift of money, property, or services, whether or not in contravention of
applicable law, (i) as a kickback or bribe to any person or (ii) to any political organization, or the holder of or any aspirant to any
elective or appointive public office except for personal political contributions not involving the direct or indirect use of funds of
the Company or any of its Subsidiaries.
4. ADDITIONAL COVENANTS, AGREEMENTS AND ACKNOWLEDGEMENTS.
a.
Best Efforts. The parties shall use their best efforts to satisfy timely each of the conditions described in Section 6 and 7 of
this Agreement.
b.
Transfer Agent. Within 30 days of the date hereof, the Company shall change its transfer agent, Endeavor Trust Corporation, and
appoint either Vstock Transfer, LLC or Continental Stock Transfer & Trust Company. Failure by the Company to fulfill this section
4(b) within 30 days shall result in the Company being required to pay the Investor a sum of $100,000 and then a weekly sum of $10,000
for every week the Company has failed to fulfill this section 4(b).
c.
Use of Proceeds. The Company shall use the proceeds for business development, and not for the repayment of any indebtedness owed
to officers, directors or employees of the Company or their affiliates or in violation or contravention of any applicable law, rule or
regulation.
d.
Right of First Refusal. Until the earlier of (i) July 2, 2024, and (ii) and such date as the Buyer no longer beneficially owns
Shares, Warrants, or any Warrant Shares, if the Company has a bona fide offer of capital or financing (equity, debt, or otherwise) from
any 3rd party that the Company intends to act upon, then the Company must first offer such opportunity to the Buyer to provide such capital
or financing to the Company on the same terms as each respective 3rd party’s terms. Should the Buyer be unwilling or unable to
provide such capital or financing to the Company within 5 trading days from Buyer’s receipt of written notice of the offer (the
“Offer Notice”) from the Company, then the Company may obtain such capital or financing from that respective 3rd party upon
the exact same terms and conditions offered by the Company to the Buyer, which transaction must be completed within 30 days after the
date of the Offer Notice (except in the case of a proposed “overnight” or “intraday” financing in which case
the Company shall be required to provide 1 trading days’ notice to the Buyer). If the Company does not receive the capital or financing
from the respective 3rd party within 30 days after the date of the respective Offer Notice, then the Company must again offer the capital
or financing opportunity to the Buyer as described above, and the process detailed above shall be repeated. Notwithstanding the foregoing,
the Company may not engage in any financing until the date that is 30 days after a registration statement registering the Shares and
the Warrant Shares shall have been declared effective. For the avoidance of doubt, the provisions of this Section 4(d) shall not apply
to any Fundamental Transaction or the offer of capital or financing (equity, debt, or otherwise) from any third party to the Company
made or contemplated in connection with any Fundamental Transaction.
e.
Restriction on Activities. Until the earlier of (i) July 2, 2024, and (ii) and such date as the Buyer no longer beneficially owns
Shares, Warrants, or Warrant Shares, the Company shall not, directly or indirectly, without the Buyer’s prior written consent,
which consent shall not be unreasonably withheld: (a) change the nature of its business; (b) sell, divest, acquire, change the structure
of any material assets other than in the ordinary course of business; or (c) consummate any Variable Rate Transaction (as defined herein);
provided, that the foregoing restrictions shall not apply in respect of any Exempt Issuance. For purposes of this Agreement, an “Exempt
Issuance” shall mean “Exempt Issuance” means the issuance of securities issued (i) pursuant to acquisitions or strategic
transactions approved by a majority of the disinterested directors of the Company, provided that such securities are issued as “restricted
securities” (as defined in Rule 144) and carry no registration rights that require or permit the filing of any registration statement
in connection therewith, and provided that any such issuance shall only be to a Person (or to the equity holders of a Person) which is,
itself or through its subsidiaries, an operating company or an owner of an asset in a business synergistic with the business of the Company
and shall provide to the Company additional benefits in addition to the investment of funds, but shall not include a transaction in which
the Company is issuing securities primarily for the purpose of raising capital or to an entity whose business involves investing in securities,
or (ii) in any Fundamental Transaction, as defined in the Warrants.
f.
Listing. The Company will, so long as the Buyer owns any of the Securities, maintain the listing and trading of its Common Shares
on the Principal Market or any equivalent replacement exchange or electronic quotation system (including but not limited to the Pink
Sheets electronic quotation system) and will comply in all respects with the Company’s reporting, filing and other obligations
under the bylaws or rules of the Financial Industry Regulatory Authority (“FINRA”) and such exchanges, as applicable. The
Company shall promptly provide to the Buyer copies of any notices it receives from the Principal Market and any other exchanges or electronic
quotation systems on which the Common Shares are then traded regarding the continued eligibility of the Common Shares for listing on
such exchanges and quotation systems.
g. Corporate Existence. The Company will, so long as the Buyer beneficially owns any of the Securities, maintain its corporate existence and shall not sell all or substantially all of the Company’s assets, except in the event of a merger or consolidation or sale of all or substantially all of the Company’s assets, where the surviving or successor entity in such transaction (i) assumes the Company’s obligations hereunder and under the agreements and instruments entered into in connection herewith and (ii) is a publicly traded corporation whose Common Shares are listed for trading or quotation on the Principal Market, any tier of the NASDAQ Stock Market, the New York Stock Exchange or the NYSE MKT.
h.
No Integration. The Company shall not make any offers or sales of any security (other than the Securities) under circumstances
that would require registration of the Securities being offered or sold hereunder under the 1933 Act or cause the offering of the Securities
to be integrated with any other offering of securities by the Company for the purpose of any stockholder approval provision applicable
to the Company or its securities.
i.
Compliance with 1934 Act; Public Information Failures. For so long as the Buyer beneficially owns the Shares, Warrants, or any
Warrant Shares, the Company shall comply with the reporting requirements of the 1934 Act; and the Company shall continue to be subject
to the reporting requirements of the 1934 Act. During the period that the Buyer beneficially owns the Shares, Warrants, or any Warrant
Shares, if the Company shall (i) fail for any reason to satisfy the requirements of Rule 144(c)(1), including, without limitation, the
failure to satisfy the current public information requirements under Rule 144(c) or (ii) if the Company has ever been an issuer described
in Rule 144(i)(1)(i) or becomes such an issuer in the future, and the Company shall fail to satisfy any condition set forth in Rule 144(i)(2)
(each, a “Public Information Failure”) then, as partial relief for the damages to the Buyer by reason of any such delay in
or reduction of its ability to sell the Securities (which remedy shall not be exclusive of any other remedies available pursuant to this
Agreement, the Warrants, or at law or in equity), the Company shall pay to the Buyer an amount in cash equal to three percent (3%) of
the Purchase Price on each of the day of a Public Information Failure and on every thirtieth day (pro rated for periods totaling less
than thirty days) thereafter until the date such Public Information Failure is cured. The payments to which a holder shall be entitled
pursuant to this Section 4(k) are referred to herein as “Public Information Failure Payments.” Public Information Failure
Payments shall be paid on the earlier of (i) the last day of the calendar month during which such Public Information Failure Payments
are incurred and (iii) the third business day after the event or failure giving rise to the Public Information Failure Payments is cured.
In the event the Company fails to make Public Information Failure Payments in a timely manner, such Public Information Failure Payments
shall bear interest at the rate of 5% per month (prorated for partial months) until paid in full.
j.
Disclosure of Transactions and Other Material Information. By 9:00 a.m., Eastern Standard Time, following the date this Agreement
has been fully executed, the Company shall file a Current Report on Form 6-K (if required) describing the terms of the transactions contemplated
by this Agreement in the form required by the 1934 Act and attaching this Agreement and the Warrants (the “6-K Filing”).
From and after the filing of the 6-K Filing with the SEC, the Buyer shall not be in possession of any material, nonpublic information
received from the Company, any of its Subsidiaries or any of their respective officers, directors, employees or agents that is not disclosed
in the 6-K Filing. In addition, effective upon the filing of the 6-K Filing, the Company acknowledges and agrees that any and all confidentiality
or similar obligations under any agreement, whether written or oral, between the Company, any of its Subsidiaries or any of their respective
officers, directors, affiliates, employees or agents, on the one hand, and the Buyer or any of its affiliates, on the other hand, shall
terminate.
k.
Legal Counsel Opinions. Upon the request of the Buyer from to time to time, the Company shall be responsible (at its cost) for
promptly supplying to the Company’s transfer agent and the Buyer a customary legal opinion letter of its counsel (the “Legal
Counsel Opinion”) to the effect that the resale of the Warrant Shares by the Buyer or its affiliates, successors and assigns is
exempt from the registration requirements of the 1933 Act pursuant to Rule 144 (provided the requirements of Rule 144 are satisfied and
provided the Warrant Shares are not then registered under the 1933 Act for resale pursuant to an effective registration statement) or
other applicable exemption (provided the requirements of such other applicable exemption are satisfied). Should the Company’s legal
counsel fail for any reason to issue the Legal Counsel Opinion, the Buyer may (at the Company’s cost) secure another legal counsel
to issue the Legal Counsel Opinion, and the Company will instruct its transfer agent to accept such opinion. The Company hereby agrees
that it may never take the position that it is a “shell company” in connection with its obligations under this Agreement
or otherwise.
l.
Registration Rights. The Company hereby grants to the Buyer the registration rights set forth in the registration rights agreement
entered into between the Company and the Buyer on the date of this Agreement (the “Registration Rights Agreement”) as well
as the piggy-back registration rights set forth on Exhibit E hereto.
m. Most Favored Nation. Until the earlier of (i) July 2, 2024, (ii) and such date as the Buyer no longer beneficially owns Shares, Warrants, or Warrant Shares, the Company shall not enter into any public or private offering of its securities (including securities convertible into shares of Common Stock) with any individual or entity (an “Other Investor”) that has the effect of establishing rights or otherwise benefiting such Other Investor in a manner more favorable in any material respect to such Other Investor than the rights and benefits established in favor of the Buyer by this Agreement or the Warrants unless, in any such case, the Buyer has been provided with such rights and benefits pursuant to a definitive written agreement or agreements between the Company and the Buyer.
n. Subsequent
Variable Rate Transactions. Until the earlier of (i) July 2, 2024, (ii) and such date as the Buyer no longer beneficially owns Shares,
Warrants, or Warrant Shares, , the Company shall be prohibited from effecting or entering into an agreement involving a Variable Rate
Transaction. “Variable Rate Transaction” means a transaction in which the Company (i) issues or sells any debt or equity
securities that are convertible into, exchangeable or exercisable for, or include the right to receive, additional Common Shares either
(A) at a conversion price, exercise price or exchange rate or other price that is based upon, and/or varies with, the trading prices
of or quotations for the Common Shares at any time after the initial issuance of such debt or equity securities or (B) with a conversion,
exercise or exchange price that is subject to being reset at some future date after the initial issuance of such debt or equity security
or upon the occurrence of specified or contingent events directly or indirectly related to the business of the Company or the market
for the Common Stock (but which shall not include standard price reset mechanisms) or (ii) enters into any agreement, including, but
not limited to, an equity line of credit, whereby the Company may issue securities at a future determined price. During the foregoing
period the Company may only enter into an equity line of credit with the Buyer. The Buyer shall be entitled to obtain injunctive relief
against the Company to preclude any such issuance, which remedy shall be in addition to any right to collect damages.
o.
Non-Public Information. The Company covenants and agrees that neither it, nor any other person acting on its behalf will provide
the Buyer or its agents or counsel with any information that constitutes, or the Company reasonably believes constitutes, material non-public
information, unless prior thereto the Buyer shall have consented to the receipt of such information and agreed with the Company to keep
such information confidential. The Company understands and confirms that the Buyer shall be relying on the foregoing covenant in effecting
transactions in securities of the Company. To the extent that the Company delivers any material, non-public information to the Buyer
without such Buyer’s consent, the Company hereby covenants and agrees that such Buyer shall not have any duty of confidentiality
to the Company, any of its 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 Buyer shall remain subject to applicable law. To the extent
that any notice provided, information provided, or any other communications made by the Company, to the Buyer, constitutes or contains
material non-public information regarding the Company or any Subsidiaries, the Company shall simultaneously file such notice or other
material information with the SEC pursuant to a Current Report on Form 6-K. In addition to any other remedies provided by this Agreement
or the related transaction documents, if the Company provides any material non-public information to the Buyer without their prior written
consent, and it fails to immediately (no later than that business day) file a Form 6-K disclosing this material non-public information,
it shall pay the Buyer as partial liquidated damages and not as a penalty a sum equal to $2,000 per day beginning with the day the information
is disclosed to the Buyer and ending and including the day the Form 6-K disclosing this information is filed.
5. Transfer
Agent Instructions. The Company shall issue irrevocable instructions to the Company’s transfer agent to issue certificates,
registered in the name of the Buyer or its nominee, upon exercise of the Warrants, the Warrant Shares, in such amounts as specified from
time to time by the Buyer to the Company in accordance with the terms thereof (the “Irrevocable Transfer Agent Instructions”).
In the event that the Company proposes to replace its transfer agent, the Company shall provide, prior to the effective date of such
replacement, a fully executed Irrevocable Transfer Agent Instructions in a form as initially delivered pursuant to this Agreement (including
but not limited to the provision to irrevocably reserve Common Shares in the Warrants) signed by the successor transfer agent to the
Company and the Company. Prior to registration of the Warrant Shares under the 1933 Act or the date on which the Warrant Shares may be
sold pursuant to Rule 144, Rule 144A, Regulation S, or other applicable exemption without any restriction as to the number of Securities
as of a particular date that can then be immediately sold, all such certificates shall bear the restrictive legend specified in Section
2(g) of this Agreement. The Company warrants that: (i) no instruction other than the Irrevocable Transfer Agent Instructions referred
to in this Section 5 will be given by the Company to its transfer agent and that the Securities shall otherwise be freely transferable
on the books and records of the Company as and to the extent provided in this Agreement and the Warrants; (ii) it will not direct its
transfer agent not to transfer or delay, impair, and/or hinder its transfer agent in transferring (or issuing)(electronically or in certificated
form) any Securities to be issued to the Buyer when required by the Warrants and this Agreement; (iii) it will not fail to remove (or
directs its transfer agent not to remove or impairs, delays, and/or hinders its transfer agent from removing) any restrictive legend
(or to withdraw any stop transfer instructions in respect thereof) on any certificate for any Securities issued to the Buyer as and when
required by the Warrants and this Agreement and (iv) it will provide any required corporate resolutions and issuance approvals to its
transfer agent within 6 hours of each exercise of the Warrants. Nothing in this Section shall affect in any way the Buyer’s obligations
and agreement set forth in Section 2(g) hereof to comply with all applicable prospectus delivery requirements, if any, upon re-sale of
the Securities. If the Buyer provides the Company, at the cost of the Company, with (i) an opinion of counsel in form, substance and
scope customary for opinions in comparable transactions, to the effect that a public sale or transfer of such Securities may be made
without registration under the 1933 Act and such sale or transfer is effected or (ii) the Buyer provides reasonable assurances that the
Securities can be sold pursuant to 144, Rule 144A, Regulation S, or other applicable exemption, the Company shall permit the transfer,
and, in the case of the Securities, promptly instruct its transfer agent to issue one or more certificates, free from restrictive legend,
in such name and in such denominations as specified by the Buyer. The Company acknowledges that a breach by it of its obligations hereunder
will cause irreparable harm to the Buyer, by vitiating the intent and purpose of the transactions contemplated hereby. Accordingly, the
Company acknowledges that the remedy at law for a breach of its obligations under this Section 5 may be inadequate and agrees, in the
event of a breach or threatened breach by the Company of the provisions of this Section, that the Buyer shall be entitled, in addition
to all other available remedies, to an injunction restraining any breach and requiring immediate transfer, without the necessity of showing
economic loss and without any bond or other security being required.
6. Conditions
to the Company’s Obligation to Sell. The obligation of the Company hereunder to issue and sell the Shares to the Buyer at the
Closing is subject to the satisfaction, at or before the Closing Date, of each of the following conditions thereto, provided that these
conditions are for the Company’s sole benefit and may be waived by the Company at any time in its sole discretion:
a. The Buyer shall have executed this Agreement and delivered the same to the Company.
b. The Buyer shall have delivered the Purchase Price to the Company in accordance with Section 1(b).
c. The
representations and warranties of the Buyer shall be true and correct in all material respects as of the date when made and as of the
Closing Date, as though made at that time (except for representations and warranties that speak as of a specific date), and the Buyer
shall have performed, satisfied and complied in all material respects with the covenants, agreements and conditions required by this
Agreement to be performed, satisfied or complied with by the Buyer at or prior to the Closing Date.
d. No
litigation, statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated or
endorsed by or in any court or governmental authority of competent jurisdiction or any self-regulatory organization having authority
over the matters contemplated hereby which prohibits the consummation of any of the transactions contemplated by this Agreement.
7. Conditions
to The Buyer’s Obligation to Purchase. The obligation of the Buyer hereunder to purchase the Shares, on the Closing Date, is
subject to the satisfaction, at or before the Closing Date, of each of the following conditions, provided that these conditions are for
the Buyer’s sole benefit and may be waived by the Buyer at any time in its sole discretion:
a. The Company shall have executed this Agreement and delivered the same to the Buyer.
b. The
Company shall have delivered the Shares to the Buyer.
c. The Company shall have delivered to the Buyer the Warrants.
d. The
Irrevocable Transfer Agent Instructions, in form and substance satisfactory to the Buyer, shall have been delivered to and acknowledged
in writing by the Company’s Transfer Agent, and the share reserve thereunder shall have been reserved for the Buyer.
e. The
representations and warranties of the Company shall be true and correct in all material respects as of the date when made and as of Closing
Date, as though made at such time (except for representations and warranties that speak as of a specific date) and the Company shall
have performed, satisfied and complied in all material respects with the covenants, agreements and conditions required by this Agreement
to be performed, satisfied or complied with by the Company at or prior to the Closing Date.
f. No
litigation, statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated or
endorsed by or in any court or governmental authority of competent jurisdiction or any self-regulatory organization having authority
over the matters contemplated hereby which prohibits the consummation of any of the transactions contemplated by this Agreement.
g. No
event shall have occurred which could reasonably be expected to have a Material Adverse Effect on the Company including but not limited
to a change in the 1934 Act reporting status of the Company or the failure of the Company to be timely in its 1934 Act reporting obligations.
h. Trading
in the Common Shares on the Principal Market shall not have been suspended by the SEC, FINRA or the Principal Market.
i. The
Company shall have delivered to the Buyer (i) a certificate evidencing the formation and good standing of the Company and each of its
Subsidiaries in such entity’s jurisdiction of formation issued by the Secretary of State (or comparable office) of such jurisdiction,
as of a date within ten (10) days of the Closing Date and (ii) resolutions adopted by the Company’s Board of Directors at a duly
called meeting or by unanimous written consent authorizing this Agreement and all other documents, instruments and transactions contemplated
hereby.
j. Governing
Law; Miscellaneous. This Agreement shall be deemed executed, delivered and performed in Nevis. This Agreement shall be solely and
exclusively construed and enforced in accordance with, and all questions concerning the construction, validity, interpretation and performance
of this Agreement shall be governed solely and exclusively by the internal laws of Nevis, without giving effect to any choice of law
or conflict of law provision or rule (whether of Nevis or any other jurisdiction) that would cause the application of the laws of any
jurisdiction other than Nevis. The Company irrevocably and exclusively consents to and expressly agrees that binding arbitration in Nevis
conducted by the Arbitrator Conflict Resolution Centre shall be their sole and exclusive remedy for any dispute arising out of or relating
to the Agreement, Irrevocable Instructions or any other agreement between the parties, the Company’s transfer agent or the relationship
of the parties or their affiliates, and that the arbitration shall be conducted via telephone or teleconference. If the Arbitrator is
not available, a different arbitrator or law firm in Nevis shall be chosen by the Buyer and agreed upon by the Company. Company covenants
and agrees to provide written notice to Buyer via email prior to bringing any action or arbitration action against the Company’s
transfer agent or any action against any person or entity that is not a party to this Agreement that is related in any way to this Agreement
or any of the Exhibits under this Agreement or any transaction contemplated herein or therein, and further agrees to timely notify Buyer
to any such action. Company acknowledges that the governing law and venue provisions set forth in this Agreement are material terms to
induce Buyer to enter into the Transaction Documents and that but for Company’s agreements set forth in this section, Buyer would
not have entered into the Transaction Documents. In the event that the Buyer needs to take action to protect their rights under the Agreement,
the Buyer may commence action in any jurisdiction needed with the understanding that the Agreement shall still be solely and exclusively
construed and enforced in accordance with, and all questions concerning the construction, validity, interpretation and performance of
this Agreement shall be governed solely and exclusively by the internal laws of Nevis, without giving effect to any choice of law or
conflict of law provision or rule (whether of Nevis or any other jurisdiction) that would cause the application of the laws of any jurisdiction
other than the Nevis. This section and provision of the Agreement will not apply to the Confession of Judgment.
k. Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original but all of which shall constitute one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to the other party. A facsimile or .pdf signature shall be considered due execution and shall be binding upon the signatory thereto with the same force an effect as if the signature were an original, not a facsimile or .pdf signature. Delivery of a counterpart signature hereto by facsimile or email/.pdf transmission shall be deemed validly delivery thereof.
l. Construction; Headings. This Agreement shall be deemed to be jointly drafted by the Company and the Buyer and shall not be construed against any person as the drafter hereof. The headings of this Agreement are for convenience of reference only and shall not form part of, or affect the interpretation of, this Agreement.
m. Severability. In the event that any provision of this Agreement, the Warrants, or any other agreement or instrument delivered in connection herewith is invalid or unenforceable under any applicable statute or rule of law, then such provision shall be deemed inoperative to the extent that it may conflict therewith and shall be deemed modified to conform with such statute or rule of law. Any such provision which may prove invalid or unenforceable under any law shall not affect the validity or enforceability of any other provision of this Agreement, the Warrants, or any other agreement, certificate, instrument or document contemplated hereby or thereby.
n. Entire Agreement; Amendments. This Agreement, the Warrants, and the instruments referenced herein contain the entire understanding of the parties with respect to the matters covered herein and therein and, except as specifically set forth herein or therein, neither the Company nor the Buyer makes any representation, warranty, covenant or undertaking with respect to such matters. No provision of this Agreement or any agreement or instrument contemplated hereby may be waived or amended other than by an instrument in writing signed by the Buyer.
o. Notices. All notices, demands, requests, consents, approvals, and other communications required or permitted hereunder shall be in writing and, unless otherwise specified herein, shall be transmitted by e-mail. Any notice or other communication required or permitted to be given hereunder shall be deemed effective upon delivery by e-mail at the address designated below (if delivered on a business day during normal business hours where such notice is to be received), or the first business day following such delivery (if delivered other than on a business day during normal business hours where such notice is to be received) The addresses for such communications shall be:
If
to the Company, to: aneil@bruush.com
With
a copy to (which shall not constitute notice):
Lucosky
Brookman LLP
101
Wood Avenue South
Fifth
Floor
Woodbridge,
NJ 08830
Attention:
Seth Brookman
Email:
sbrookman@lucbro.com
If
to the Buyer, to: [ ]
p.
Successors and Assigns. This Agreement shall be binding upon the Company and its successors and assigns, and shall inure to the
benefit of the Buyer and its successors and assigns. The Buyer has the full control and discretion to assign or transfer this Agreement
to any transferee without the consent of the Company or have the shares that it receives pursuant to this agreement and the exercise
of any warrants, sent to any third party at its sole discretion, without the consent of the Company. The Buyer may instruct the Company
and its transfer Agent that this Agreement has been transferred or assigned to an Assignee and that the Assignee is now the new Buyer
of this Agreement without any new Agreement being required to be issued by the Company to the Assignee. To further clarify, and by way
of example only, if _______ sells, assigns or transfers the Agreement to ABC Fund, LLC, then ABC Fund, LLC shall now be the new
Buyer under this Agreement, regardless of whether a new Agreement is issued by the Company in the name of ABC Fund, LLC.
q. Third Party Beneficiaries. This Agreement is intended for the benefit of the parties hereto and their respective permitted successors and assigns, and is not for the benefit of, nor may any provision hereof be enforced by, any other person.
r. Survival. The representations and warranties of the Company and the agreements and covenants set forth in this Agreement shall survive the closing hereunder notwithstanding any due diligence investigation conducted by or on behalf of the Buyer. The Company agrees to indemnify and hold harmless the Buyer and all their officers, directors, employees and agents for loss or damage arising as a result of or related to any breach or alleged breach by the Company of any of its representations, warranties and covenants set forth in this Agreement or any of its covenants and obligations under this Agreement, including advancement of expenses as they are incurred.
s. Publicity. The Company, and the Buyer shall have the right to review a reasonable period of time before issuance of any press releases, SEC, Principal Market or FINRA filings, or any other public statements with respect to the transactions contemplated hereby; provided, however, that the Company shall be entitled, without the prior approval of the Buyer, to make any press release or SEC, Principal Market (or other applicable trading market) or FINRA filings with respect to such transactions as is required by applicable law and regulations (although the Buyer shall be consulted by the Company in connection with any such press release prior to its release and shall be provided with a copy thereof and be given an opportunity to comment thereon).
t. Further Assurances. Each party shall do and perform, or cause to be done and performed, all such further acts and things, and shall execute and deliver all such other agreements, certificates, instruments and documents, as the other party may reasonably request in order to carry out the intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby.
u. No Strict Construction. The language used in this Agreement will be deemed to be the language chosen by the parties to express their mutual intent, and no rules of strict construction will be applied against any party.
v. Indemnification. In consideration of the Buyer’s execution and delivery of this Agreement and acquiring the Securities hereunder, and in addition to all of the Company’s other obligations under this Agreement or the Warrants, the Company shall defend, protect, indemnify and hold harmless the Buyer and its stockholders, partners, members, officers, directors, employees and direct or indirect investors and any of the foregoing persons’ agents or other representatives (including, without limitation, those retained in connection with the transactions contemplated by this Agreement) (collectively, the “Indemnitees”) from and against any and all actions, causes of action, suits, claims, losses, costs, penalties, fees, liabilities and damages, and expenses in connection therewith (irrespective of whether any such Indemnitee is a party to the action for which indemnification hereunder is sought), and including reasonable attorneys’ fees and disbursements (the “Indemnified Liabilities”), incurred by any Indemnitee as a result of, or arising out of, or relating to (a) any misrepresentation or breach of any representation or warranty made by the Company in this Agreement or any other agreement, certificate, instrument or document contemplated hereby or thereby, (b) any breach of any covenant, agreement or obligation of the Company contained in this Agreement, the Warrants, or any other agreement, certificate, instrument or document contemplated hereby or thereby or (c) any cause of action, suit or claim brought or made against such Indemnitee by a third party (including for these purposes a derivative action brought on behalf of the Company) and arising out of or resulting from (i) the execution, delivery, performance or enforcement of this Agreement, the Warrants or any other agreement, certificate, instrument or document contemplated hereby or thereby, (ii) any transaction financed or to be financed in whole or in part, directly or indirectly, with the proceeds of the issuance of the Securities, or (iii) the status of the Buyer or holder of the Securities as an investor in the Company pursuant to the transactions contemplated by this Agreement. To the extent that the foregoing undertaking by the Company may be unenforceable for any reason, the Company shall make the maximum contribution to the payment and satisfaction of each of the Indemnified Liabilities that is permissible under applicable law. Buyer shall be further indemnified and protected by not being bound by the Governing Law Provision of this Agreement.
w. Remedies. The Company acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the Buyer by vitiating the intent and purpose of the transaction contemplated hereby. Accordingly, the Company acknowledges that the remedy at law for a breach of its obligations under this Agreement, Warrants, or any other agreement, certificate, instrument or document contemplated hereby or thereby will be inadequate and agrees, in the event of a breach or threatened breach by the Company of the provisions of this Agreement, the Warrants, or any other agreement, certificate, instrument or document contemplated hereby or thereby, that the Buyer shall be entitled, in addition to all other available remedies at law or in equity, and in addition to the penalties assessable herein, to an injunction or injunctions restraining, preventing or curing any breach of this Agreement, Warrants, or any other agreement, certificate, instrument or document contemplated hereby or thereby, and to enforce specifically the terms and provisions hereof and thereof, without the necessity of showing economic loss and without any bond or other security being required.
x. Payment Set Aside. To the extent that the Company makes a payment or payments to the Buyer hereunder or pursuant to the Warrants or any other agreement, certificate, instrument or document contemplated hereby or thereby, or the Buyer enforces or exercises its rights hereunder or thereunder, and such payment or payments or the proceeds of such enforcement or exercise or any part thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside, recovered from, disgorged by or are required to be refunded, repaid or otherwise restored to the Company, a trustee, receiver or any other person or entity under any law (including, without limitation, any bankruptcy law, foreign, state or federal law, common law or equitable cause of action), then to the extent of any such restoration the obligation or part thereof originally intended to be satisfied shall be revived and continued in full force and effect as if such payment had not been made or such enforcement or setoff had not occurred.
y.
No Broker-Dealer Acknowledgement. _______, is the Investor, in association
with Benchmark Investments, LLC. Benchmark Investments, LLC is the placement agent for this investment and is a broker-dealer registered
with the SEC and is a member FINRA. So long as any obligation of Company under this Agreement, or the other Transaction Documents is
outstanding, the Company shall not state, claim, allege, or in any way assert to any person, institution, or entity, that Investor is
currently, or ever has been, a broker-dealer under the Securities Exchange Act of 1934. Benchmark Investments, LLC is the registered
broker - dealer.
z. Failure or Indulgence Not Waiver. No failure or delay on the part of the Buyer in the exercise of any power, right or privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such power, right or privilege preclude other or further exercise thereof or of any other right, power or privileges. All rights and remedies of the Buyer existing hereunder are cumulative to, and not exclusive of, any rights or remedies otherwise available.
aa. Exhibits. This Agreement shall include the following exhibits which shall form part of the Agreement:
Exhibit
A Prefunded Common Share Purchase Warrant A
Exhibit
B Common Share Purchase Warrant B
Exhibit C Irrevocable Instructions
Exhibit D Officer’s Certificate
Exhibit E Confession of Judgment
Exhibit
F Registration Rights Agreement
bb. Confession Of Judgment. The Company hereby irrevocably authorizes and empowers, the Buyer and any attorney-at-law, each as the Company’s attorney-in-fact, to appear ex parte in any court of record and to confess judgment against the Company, if the Company fails to issue the shares due or the shares due upon exercise of the Warrants by the Buyer, as evidenced by an affidavit signed by Holder setting forth the amount then due, including attorneys’ fees plus costs of suit, and to release all errors, and waive all rights of appeal. If a copy of this Agreement verified by an affidavit, shall have been filed in the proceeding, it will not be necessary to file the original as a warrant of attorney. The Company waives the right to contest Buyer’s rights under this section, including without limitation the right to any stay of execution and the benefit of all exemption laws now or hereafter in effect. No single exercise of the foregoing warrant and power to confess judgment will be deemed to exhaust the power, whether or not any such exercise shall be held by any court to be invalid, voidable, or void; but the power will continue undiminished and may be exercised from time to time as Buyer may elect until all amounts owing upon exercise of the warrants have been issued in full. The Company hereby further waives and releases any and all claims or causes of action which the Company might have against any attorney acting under the terms of authority which the Company has granted herein arising out of or connected with the confession of judgment hereunder. Notwithstanding anything to the contrary contained herein, Buyer shall not exercise its rights with respect to the foregoing power of attorney unless or until an Event of Default has occurred. Neither the Confession of Judgment nor the Buyer shall not be bound by Section 8 of this Agreement and the Investor shall have the option to commence legal proceedings with any court of their choosing.
IN
WITNESS WHEREOF, the undersigned Buyer and the Company have caused this Agreement to be duly executed as of the date first above written.
| BRUUSH ORAL CARE, INC. |
|
| |
|
|
| By:
|
|
|
| Name: |
Aneil Singh Manhas |
|
| Title: |
Chief Executive Officer |
|
Exhibit
10.2
EXHIBIT
F
REGISTRATION
RIGHTS AGREEMENT
REGISTRATION
RIGHTS AGREEMENT (this “Agreement”), dated as of October 2, 2023, by and between BRUUSH ORAL CARE, INC., a
corporation incorporated in British Columbia, Canada, with principal executive offices located at 128 West Hastings Street, Unit 210
Vancouver, British Columbia V6B 1G8 (the “Company”), and _______, a limited company organized under
the laws of Saint Kitts and Nevis (together with its permitted assigns, the “Investor”). Capitalized terms used herein
and not otherwise defined herein shall have the respective meanings set forth in the Securities Purchase Agreement by and between the
parties hereto, dated as of the date hereof (as amended, restated, supplemented or otherwise modified from time to time, the “Purchase
Agreement”).
WHEREAS,
upon the terms and subject to the conditions of the Purchase Agreement, the Company has agreed, to sell to the Investor, and the Investor
has agreed to purchase from the Company, the Shares (as defined in the Purchase Agreement) (the “Registerable Common Shares”)
and the Company’s Common Shares issuable upon exercise of Warrant A and Warrant B (“Warrant Shares” and together
with the Registerable Common Shares, the “Shares”) for the consideration set forth therein.
WHEREAS,
to induce the Investor to enter into the Purchase Agreement, the Company has agreed to provide the Investor the right to require the
Company to register the Shares under the Securities Act of 1933, as amended, and the rules and regulations thereunder (collectively,
the “Securities Act”).
NOW,
THEREFORE, in consideration of the promises and the mutual covenants contained herein and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the Company and the Investor hereby agree as follows:
1. DEFINITIONS.
As
used in this Agreement, the following terms shall have the following meanings:
a.
“Investor” means the _______, or any transferee or assignee thereof who is assigned its rights and who agrees
to become bound by the provisions of this Agreement, and any transferee or assignee thereof to whom a transferee or assignee assigns
its rights under this Agreement and who agrees to become bound by the provisions of this Agreement.
b. “Person”
means any individual or entity including but not limited to any corporation, a limited liability company, an association, a partnership,
an organization, a business, an individual, a governmental or political subdivision thereof or a governmental agency.
c. “Register,”
“registered,” and “registration” refer to a registration effected by preparing and filing with
the U.S. Securities and Exchange Commission (the “SEC”) one or more registration statements of the Company pursuant
to the Securities Act and pursuant to Rule 415 under the Securities Act providing for offering securities on a continuous basis (“Rule
415”), and the declaration of effectiveness of such registration statement(s) by the SEC.
d. “Registrable
Securities” means the Shares and any Common Shares issued to the Investor as a result of any stock split, stock dividend, recapitalization,
exchange or similar event or otherwise, without regard to any limitation on purchases under the Purchase Agreement.
e. “Registration
Statement” means one or more registration statements of the Company covering only the sale of the Registrable Securities pursuant
to the Securities Act..
2. REGISTRATION.
a. Mandatory
Registration. The Company shall, within five (5) calendar days from the date that the resale registration statement required to
be filed by that certain Inducement Letter entered into by the Company on August 22, 2023 is declared effective (the “Filing
Date”),, file with the SEC a F-1 Registration Statement covering the maximum number of Registrable Securities as shall be
permitted to be included thereon in accordance with applicable SEC rules, regulations and interpretations so as to permit the resale
of such Registrable Securities by the Investor, including but not limited to under Rule 415 under the Securities Act at then
prevailing market prices (and not fixed prices), subject to the aggregate number of authorized shares of the Company’s Common
Shares then available for issuance in its Certificate of Incorporation. The F-1 Registration Statement shall register only the
Registrable Securities. The Investor and its counsel shall have a reasonable opportunity to review and comment upon such
Registration Statement and any amendment or supplement to such Registration Statement and any related prospectus prior to its filing
with the SEC, and the Company shall give due consideration to all reasonable comments. The Investor shall furnish all information
reasonably requested by the Company for inclusion therein. The Company shall have the Registration Statement and any amendment
declared effective by the SEC at the earliest possible date (in any event within sixty (60) calendar days from the Filing Date). The
Company shall keep the Registration Statement effective, at all times until the date on which the Investor shall have sold all the
Registrable Securities covered thereby (the “Registration Period”). The Registration Statement (including any
amendments or supplements thereto and prospectuses contained therein) shall not contain any untrue statement of a material fact or
omit to state a material fact required to be stated therein not misleading.
b. Rule
424 Prospectus. The Company shall, as required by applicable securities regulations, from time to time file with the SEC, pursuant
to Rule 424 under the Securities Act, the prospectus and prospectus supplements, if any, to be used in connection with sales of the Registrable
Securities under the Registration Statement. The Investor and its counsel shall have a reasonable opportunity to review and comment upon
such prospectus prior to its filing with the SEC, and the Company shall give due consideration to all such comments. The Investor shall
use its reasonable best efforts to comment upon such prospectus within one (1) Business Day from the date the Investor receives the final
pre-filing version of such prospectus.
c. Sufficient
Number of Shares Registered. In the event the number of shares available under the Registration Statement is insufficient to cover
all of the Registrable Securities, the Company shall amend the Registration Statement or file a new Registration Statement (a “New
Registration Statement”), so as to cover all of such Registrable Securities (subject to the limitations set forth in Section
2(a)) as soon as practicable, but in any event not later than ten (10) Business Days after the necessity therefor arises, subject to
any limits that may be imposed by the SEC pursuant to Rule 415 under the Securities Act. The Company shall use it reasonable best efforts
to cause such amendment and/or New Registration Statement to become effective as soon as practicable following the filing thereof. In
the event that any of the Registrable Securities are not included in the Registration Statement, or have not been included in any New
Registration Statement and the Company files any other registration statement under the Securities Act (other than on Form S-4, Form
S-8, or with respect to other employee related plans or rights offerings) (“Other Registration Statement”) then the
Company shall include such remaining Registrable Securities in such Other Registration Statement. The Company agrees that it shall not
file any such Other Registration Statement unless all of the Registrable Securities have been included in such Other Registration Statement
or otherwise have been registered for resale as described above.
d.
Offering. If the staff of the SEC (the “Staff”) or the SEC seeks to characterize any offering pursuant to a
Registration Statement filed pursuant to this Agreement as constituting an offering of securities that does not permit such Registration
Statement to become effective and be used for resales by the Investor under Rule 415 at then prevailing market prices (and not fixed
prices), or if after the filing of the initial Registration Statement with the SEC pursuant to Section 2(a), the Company is otherwise
required by the Staff or the SEC to reduce the number of Registrable Securities included in such initial Registration Statement, then
the Company shall reduce the number of Registrable Securities to be included in such initial Registration Statement (with the prior consent,
which shall not be unreasonably withheld, of the Investor and its legal counsel as to the specific Registrable Securities to be removed
therefrom) until such time as the Staff and the SEC shall so permit such Registration Statement to become effective and be used as aforesaid.
In the event of any reduction in Registrable Securities pursuant to this paragraph, the Company shall file one or more New Registration
Statements in accordance with Section 2(c) until such time as all Registrable Securities have been included in Registration Statements
that have been declared effective and the prospectus contained therein is available for use by the Investor. Notwithstanding any provision
herein or in the Purchase Agreement to the contrary, the Company’s obligations to register Registrable Securities (and any related
conditions to the Investor’s obligations) shall be qualified as necessary to comport with any requirement of the SEC or the Staff
as addressed in this Section 2(d).
3. RELATED
OBLIGATIONS.
With
respect to the Registration Statement and whenever any Registrable Securities are to be registered pursuant to Section 2 including on
any New Registration Statement, the Company shall use its reasonable best efforts to effect the registration of the Registrable Securities
in accordance with the intended method of disposition thereof and, pursuant thereto, the Company shall have the following obligations:
a. The
Company shall prepare and file with the SEC such amendments (including post-effective amendments) and supplements to any registration
statement and the prospectus used in connection with such registration statement, which prospectus is to be filed pursuant to Rule 424
promulgated under the Securities Act, as may be necessary to keep the Registration Statement or any New Registration Statement effective
at all times during the Registration Period, and, during such period, comply with the provisions of the Securities Act with respect to
the disposition of all Registrable Securities of the Company covered by the Registration Statement or any New Registration Statement
until such time as all of such Registrable Securities shall have been disposed of in accordance with the intended methods of disposition
by the seller or sellers thereof as set forth in such registration statement.
b. The
Company shall permit the Investor to review and comment upon the Registration Statement or any New Registration Statement and all amendments
and supplements thereto at least two (2) Business Days prior to their filing with the SEC, and not file any document in a form to which
Investor reasonably objects. The Investor shall use its reasonable best efforts to comment upon the Registration Statement or any New
Registration Statement and any amendments or supplements thereto within one (1) Business Day from the date the Investor receives the
final version thereof. The Company shall furnish to the Investor, without charge any correspondence from the SEC or the staff of the
SEC to the Company or its representatives relating to the Registration Statement or any New Registration Statement.
c. Upon
request of the Investor, the Company shall furnish to the Investor, (i) promptly after the same is prepared and filed with the SEC, at
least one copy of such registration statement and any amendment(s) thereto, including financial statements and schedules, all documents
incorporated therein by reference and all exhibits, (ii) upon the effectiveness of any registration statement, a copy of the prospectus
included in such registration statement and all amendments and supplements thereto (or such other number of copies as the Investor may
reasonably request) and (iii) such other documents, including copies of any preliminary or final prospectus, as the Investor may reasonably
request from time to time in order to facilitate the disposition of the Registrable Securities owned by the Investor. For the avoidance
of doubt, any filing available to the Investor via the SEC’s EDGAR system shall be deemed “furnished to the Investor”
hereunder.
d. The
Company shall use reasonable best efforts to (i) register and qualify the Registrable Securities covered by a registration statement
under such other securities or “blue sky” laws of such jurisdictions in the United States as the Investor may reasonably
request, unless such registrations or qualifications are not necessary in connection with the intended disposition of the Shares, (ii)
prepare and file in any such jurisdictions, such amendments (including post-effective amendments) and supplements to such registrations
and qualifications as may be necessary to maintain the effectiveness thereof during the Registration Period, (iii) take such other actions
as may be necessary to maintain any such registrations and qualifications in effect at all times during the Registration Period, and
(iv) take all other actions reasonably necessary or advisable to qualify the Registrable Securities for sale in such jurisdictions, if
applicable; provided, however, that the Company shall not be required in connection therewith or as a condition thereto to (x) qualify
to do business in any jurisdiction where it would not otherwise be required to qualify, (y) subject itself to general taxation in any
such jurisdiction, or (z) file a general consent to service of process in any such jurisdiction. The Company shall promptly notify the
Investor of the receipt by the Company of any notification with respect to the suspension of the registration or qualification of any
of the Registrable Securities for sale under the securities or “blue sky” laws of any jurisdiction in the United States or
its receipt of actual notice of the initiation or threatening of any proceeding for such purpose.
e. As
promptly as practicable after becoming aware of such event or facts, the Company shall notify the Investor in writing of the happening
of any event or existence of such facts as a result of which the prospectus included in any registration statement, as then in effect,
includes an untrue statement of a material fact or omits to state a material fact required to be stated therein not misleading, and promptly
prepare a supplement or amendment to such registration statement to correct such untrue statement or omission, and deliver a copy of
such supplement or amendment to the Investor (or such other number of copies as the Investor may reasonably request). The Company shall
also promptly notify the Investor in writing (i) when a prospectus or any prospectus supplement or post-effective amendment has been
filed, and when a registration statement or any post-effective amendment has become effective (notification of such effectiveness shall
be delivered to the Investor by email or facsimile on the same day of such effectiveness and by overnight mail), (ii) of any request
by the SEC for amendments or supplements to any registration statement or related prospectus or related information, and (iii) of the
Company’s reasonable determination that a post-effective amendment to a registration statement would be appropriate.
f. The
Company shall use its reasonable best efforts to prevent the issuance of any stop order or other suspension of effectiveness of any registration
statement, or the suspension of the qualification of any Registrable Securities for sale in any jurisdiction and, if such an order or
suspension is issued, to obtain the withdrawal of such order or suspension at the earliest possible moment and to notify the Investor
of the issuance of such order and the resolution thereof or its receipt of actual notice of the initiation or threat of any proceeding
for such purpose.
g. The
Company shall (i) cause all the Registrable Securities to be listed on each securities exchange on which securities of the same class
or series issued by the Company are then listed, if any, if the listing of such Registrable Securities is then permitted under the rules
of such exchange, or (ii) secure designation and quotation of all the Registrable Securities on the Principal Market. The Company shall
pay all fees and expenses in connection with satisfying its obligation under this Section.
h. The
Company shall cooperate with the Investor to facilitate the timely preparation and delivery of the Registrable Securities (not bearing
any restrictive legend) either by DWAC, DRS, or in certificated form if DWAC or DRS is unavailable, to be offered pursuant to any registration
statement and enable such Registrable Securities to be in such denominations or amounts as the Investor may reasonably request and registered
in such names as the Investor may request.
i. The
Company shall at all times maintain the current transfer agent and registrar with respect to its Common Shares.
j. If
requested by the Investor, the Company shall (i) immediately incorporate in a prospectus supplement or post-effective amendment such
information as the Investor believes should be included therein relating to the sale and distribution of Registrable Securities, including,
without limitation, information with respect to the number of Registrable Securities being sold and any other terms of the offering of
the Registrable Securities; (ii) make all required filings of such prospectus supplement or post-effective amendment as soon as practicable
upon notification of the matters to be incorporated in such prospectus supplement or post-effective amendment; and (iii) supplement or
make amendments to any registration statement.
k. The
Company shall use its reasonable best efforts to cause the Registrable Securities covered by any registration statement to be registered
with or approved by such other governmental agencies or authorities as may be necessary to consummate the disposition of such Registrable
Securities.
l. Within
one (1) Business Day after any registration statement which includes the Registrable Securities is declared effective by the SEC, the
Company shall cause legal counsel for the Company to deliver, to the transfer agent for such Registrable Securities (with copies to the
Investor) confirmation that such registration statement has been declared effective by the SEC in the form attached hereto as Exhibit
A. Thereafter, if requested by the Investor at any time, the Company shall cause its counsel to deliver to the Investor a written
confirmation whether or not the effectiveness of such registration statement has lapsed at any time for any reason (including, without
limitation, the issuance of a stop order) and whether or not the registration statement is current and available to the Investor for
sale of all of the Registrable Securities.
m. The
Company shall take all other reasonable actions necessary to expedite and facilitate disposition by the Investor of Registrable Securities
pursuant to any registration statement.
4. OBLIGATIONS
OF THE INVESTOR.
a. The
Company shall notify the Investor in writing of the information the Company reasonably requires from the Investor in connection with
any registration statement hereunder. The Investor shall furnish to the Company such information regarding itself, the Registrable Securities
held by it and the intended method of disposition of the Registrable Securities held by it as shall be reasonably required to effect
the registration of such Registrable Securities and shall execute such documents in connection with such registration as the Company
may reasonably request.
b. The
Investor agrees to cooperate with the Company as reasonably requested by the Company in connection with the preparation and filing of
any registration statement hereunder.
c. The
Investor agrees that, upon receipt of any notice from the Company of the happening of any event or existence of facts of the kind described
in Section 3(f) or the first sentence of 3(e), the Investor will immediately discontinue disposition of Registrable Securities pursuant
to any registration statement(s) covering such Registrable Securities until the Investor’s receipt of the copies of the supplemented
or amended prospectus contemplated by Section 3(f) or the first sentence of 3(e). Notwithstanding anything to the contrary, the Company
shall cause its transfer agent to promptly deliver Common Shares without any restrictive legend in accordance with the terms of the Purchase
Agreement in connection with any sale of Registrable Securities with respect to which an Investor has entered into a contract for sale
prior to the Investor’s receipt of a notice from the Company of the happening of any event of the kind described in Section 3(f)
or the first sentence of Section 3(e) and for which the Investor has not yet settled.
5. EXPENSES
OF REGISTRATION.
All
expenses incurred in connection with registrations, filings or qualifications pursuant to Sections 2 and 3, including, without limitation,
all registration, listing and qualifications fees, printers and accounting fees, and fees and disbursements of counsel for the Company,
shall be paid by the Company.
6. INDEMNIFICATION.
a. To
the fullest extent permitted by law, the Company will, and hereby does, indemnify, hold harmless and defend the Investor, each Person,
if any, who controls the Investor, the members, the directors, officers, partners, employees, agents, representatives of the Investor
and each Person, if any, who controls the Investor within the meaning of the Securities Act or the Securities Exchange Act of 1934, as
amended (the “Exchange Act”) (each, an “Indemnified Person”), against any losses, claims, damages,
liabilities, judgments, fines, penalties, charges, costs, attorneys’ fees, amounts paid in settlement or expenses, joint or several,
(collectively, “Claims”) incurred in investigating, preparing or defending any action, claim, suit, inquiry, proceeding,
investigation or appeal taken from the foregoing by or before any court or governmental, administrative or other regulatory agency, body
or the SEC, whether pending or threatened, whether or not an indemnified party is or may be a party thereto (“Indemnified Damages”),
to which any of them may become subject insofar as such Claims (or actions or proceedings, whether commenced or threatened, in respect
thereof) arise out of or are based upon: (i) any untrue statement or alleged untrue statement of a material fact in the Registration
Statement, any New Registration Statement or any post-effective amendment thereto or in any filing made in connection with the qualification
of the offering under the securities or other “blue sky” laws of any jurisdiction in which Registrable Securities are offered
(“Blue Sky Filing”), or the omission or alleged omission to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, (ii) any untrue statement or alleged untrue statement of a material fact contained
in the final prospectus (as amended or supplemented, if the Company files any amendment thereof or supplement thereto with the SEC) or
the omission or alleged omission to state therein any material fact necessary to make the statements made therein, in light of the circumstances
under which the statements therein were made, not misleading, (iii) any violation or alleged violation by the Company of the Securities
Act, the Exchange Act, any other law, including, without limitation, any state securities law, or any rule or regulation thereunder relating
to the offer or sale of the Registrable Securities pursuant to the Registration Statement or any New Registration Statement or (iv) any
material violation by the Company of this Agreement (the matters in the foregoing clauses (i) through (iv) being, collectively, “Violations”).
The Company shall reimburse each Indemnified Person promptly as such expenses are incurred and are due and payable, for any reasonable
legal fees or other reasonable expenses incurred by them in connection with investigating or defending any such Claim. Notwithstanding
anything to the contrary contained herein, the indemnification agreement contained in this Section 6(a): (i) shall not apply to a Claim
by an Indemnified Person arising out of or based upon a Violation which occurs in reliance upon and in conformity with information about
the Investor furnished in writing to the Company by such Indemnified Person expressly for use in connection with the preparation of the
Registration Statement, any New Registration Statement or any such amendment thereof or supplement thereto, if such prospectus was timely
made available by the Company pursuant to Section 3(c) or Section 3(e); (ii) with respect to any superseded prospectus, shall not inure
to the benefit of any such person from whom the person asserting any such Claim purchased the Registrable Securities that are the subject
thereof (or to the benefit of any person controlling such person) if the untrue statement or omission of material fact contained in the
superseded prospectus was corrected in the revised prospectus, as then amended or supplemented, if such revised prospectus was timely
made available by the Company pursuant to Section 3(c) or Section 3(e), and the Indemnified Person was promptly advised in writing not
to use the incorrect prospectus prior to the use giving rise to a violation and such Indemnified Person, notwithstanding such advice,
used it; (iii) shall not be available to the extent such Claim is based on a failure of the Investor to deliver or to cause to be delivered
the prospectus made available by the Company, if such prospectus was timely made available by the Company pursuant to Section 3(c) or
Section 3(e); and (iv) shall not apply to amounts paid in settlement of any Claim if such settlement is effected without the prior written
consent of the Company, which consent shall not be unreasonably withheld. Such indemnity shall remain in full force and effect regardless
of any investigation made by or on behalf of the Indemnified Person and shall survive the transfer of the Registrable Securities by the
Investor pursuant to Section 9.
b. Promptly
after receipt by an Indemnified Person or Indemnified Party under this Section 6 of notice of the commencement of any action or proceeding
(including any governmental action or proceeding) involving a Claim, such Indemnified Person or Indemnified Party shall, if a Claim in
respect thereof is to be made against any indemnifying party under this Section 6, deliver to the indemnifying party a written notice
of the commencement thereof, and the indemnifying party shall have the right to participate in, and, to the extent the indemnifying party
so desires, jointly with any other indemnifying party similarly noticed, to assume control of the defense thereof with counsel mutually
satisfactory to the indemnifying party and the Indemnified Person or the Indemnified Party, as the case may be; provided, however, that
an Indemnified Person or Indemnified Party shall have the right to retain its own counsel with the fees and expenses to be paid by the
indemnifying party, if, in the reasonable opinion of counsel retained by the indemnifying party, the representation by such counsel of
the Indemnified Person or Indemnified Party and the indemnifying party would be inappropriate due to actual or potential differing interests
between such Indemnified Person or Indemnified Party and any other party represented by such counsel in such proceeding. The Indemnified
Party or Indemnified Person shall cooperate fully with the indemnifying party in connection with any negotiation or defense of any such
action or claim by the indemnifying party and shall furnish to the indemnifying party all information reasonably available to the Indemnified
Party or Indemnified Person which relates to such action or claim. The indemnifying party shall keep the Indemnified Party or Indemnified
Person fully apprised at all times as to the status of the defense or any settlement negotiations with respect thereto. No indemnifying
party shall be liable for any settlement of any action, claim or proceeding effected without its written consent, provided, however,
that the indemnifying party shall not unreasonably withhold, delay or condition its consent. No indemnifying party shall, without the
consent of the Indemnified Party or Indemnified Person, consent to entry of any judgment or enter into any settlement or other compromise
which does not include as an unconditional term thereof the giving by the claimant or plaintiff to such Indemnified Party or Indemnified
Person of a release from all liability in respect to such claim or litigation. Following indemnification as provided for hereunder, the
indemnifying party shall be subrogated to all rights of the Indemnified Party or Indemnified Person with respect to all third parties,
firms or corporations relating to the matter for which indemnification has been made. The failure to deliver written notice to the indemnifying
party within a reasonable time of the commencement of any such action shall not relieve such indemnifying party of any liability to the
Indemnified Person or Indemnified Party under this Section 6, except to the extent that the indemnifying party is prejudiced in its ability
to defend such action.
c. The
indemnification required by this Section 6 shall be made by periodic payments of the amount thereof during the course of the investigation
or defense, as and when bills are received or Indemnified Damages are incurred.
d. The
indemnity agreements contained herein shall be in addition to (i) any cause of action or similar right of the Indemnified Party or Indemnified
Person against the indemnifying party or others, and (ii) any liabilities the indemnifying party may be subject to pursuant to the law.
7. CONTRIBUTION.
To
the extent any indemnification by an indemnifying party is prohibited or limited by law, the indemnifying party agrees to make the maximum
contribution with respect to any amounts for which it would otherwise be liable under Section 6 to the fullest extent permitted by law.
8. REPORTS
AND DISCLOSURE UNDER THE SECURITIES ACTS.
With
a view to making available to the Investor the benefits of Rule 144 under the Securities Act permit the Investor to sell securities of
the Company to the public without registration (“Rule 144”), the Company agrees, at the Company’s sole expense,
to:
a. make
and keep public information available, as those terms are understood and defined in Rule 144;
b. file
with the SEC in a timely manner all reports and other documents required of the Company under the Securities Act and the Exchange Act
so long as the Company remains subject to such requirements and the filing of such reports and other documents is required for the applicable
provisions of Rule 144;
c. furnish
to the Investor so long as the Investor owns Registrable Securities, promptly upon request, (i) a written statement by the Company that
it has complied with the reporting and or disclosure provisions of Rule 144, (ii) a copy of the most recent annual or other reports of
the Company and such other reports and documents so filed with or furnished to the SEC by the Company, and (iii) such other information
as may be reasonably requested to permit the Investor to sell such securities pursuant to Rule 144 without registration; and
d. take
such additional action as is requested by the Investor to enable the Investor to sell the Registrable Securities pursuant to Rule 144,
including, without limitation, delivering all such legal opinions, consents, certificates, resolutions and instructions to the Company’s
Transfer Agent as may be requested from time to time by the Investor and otherwise fully cooperate with Investor and Investor’s
broker to effect such sale of securities pursuant to Rule 144.
The
Company agrees that damages may be an inadequate remedy for any breach of the terms and provisions of this Section 8 and that Investor
shall, whether or not it is pursuing any remedies at law, be entitled to equitable relief in the form of a preliminary or permanent injunctions,
without having to post any bond or other security, upon any breach or threatened breach of any such terms or provisions.
9. ASSIGNMENT OF REGISTRATION RIGHTS.
The
Company shall not assign this Agreement or any rights or obligations hereunder.
10. AMENDMENT
OF REGISTRATION RIGHTS.
No
provision of this Agreement may be (i) amended other than by a written instrument signed by both parties hereto or (ii) waived other
than in a written instrument signed by the party against whom enforcement of such waiver is sought. Failure of any party to exercise
any right or remedy under this Agreement or otherwise, or delay by a party in exercising such right or remedy, shall not operate as a
waiver thereof.
11. MISCELLANEOUS.
a. Reserved.
b. Any
notices, consents, waivers or other communications required or permitted to be given under the terms of this Agreement must be in writing
and will be deemed to have been delivered: when sent by email The addresses for such communications shall be:
If
to the Company, to:
Bruush
Oral Care Inc.
128
West Hastings Street, Unit 210
Vancouver,
British Columbia V6B 1G8
Canada
Attention:
Aneil S. Manhas, Chief Executive Officer
E-mail:
aneil@bruush.com
With
a copy to (which shall not constitute notice):
Lucosky
Brookman LLP
101
Wood Avenue South, 5th Floor
Woodbridge,
NJ 08830
USA
Attention:
Seth Brookman
Email:
sbrookman@lucbro.com
If
to the Investor:
e-mail:
[ ]
c.
This
Agreement shall be deemed executed, delivered and performed in Nevis. This Agreement shall be solely and exclusively construed and enforced
in accordance with, and all questions concerning the construction, validity, interpretation and performance of this Agreement shall be
governed solely and exclusively by the internal laws of Nevis, without giving effect to any choice of law or conflict of law provision
or rule (whether of Nevis or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than Nevis.
The Company irrevocably and exclusively consents to and expressly agrees that binding arbitration in Nevis conducted by the Arbitrator
Conflict Resolution Centre shall be their sole and exclusive remedy for any dispute arising out of or relating to the Securities Purchase
Agreement, Irrevocable Instructions or any other agreement between the parties, the Company’s transfer agent or the relationship
of the parties or their affiliates, and that the arbitration shall be conducted via telephone or teleconference. If the Arbitrator is
not available, a different arbitrator or law firm in Nevis shall be chosen by the Investor and agreed upon by the Company. Company covenants
and agrees to provide written notice to Investor via email prior to bringing any action or arbitration action against the Company’s
transfer agent or any action against any person or entity that is not a party to this Agreement that is related in any way to this Agreement
or any of the Exhibits under this Agreement or any transaction contemplated herein or therein, and further agrees to timely notify Investor
to any such action. Company acknowledges that the governing law and venue provisions set forth in this Agreement are material terms to
induce Investor to enter into the Securities Purchase Agreement and that but for Company’s agreements set forth in this section,
Investor would not have entered into the Transaction Documents. In the event that the Investor needs to take action to protect their
rights under the Securities Purchase Agreement, the Investor may commence action in any jurisdiction needed with the understanding that
the Agreement shall still be solely and exclusively construed and enforced in accordance with, and all questions concerning the construction,
validity, interpretation and performance of this Agreement shall be governed solely and exclusively by the internal laws of Nevis, without
giving effect to any choice of law or conflict of law provision or rule (whether of Nevis or any other jurisdiction) that would cause
the application of the laws of any jurisdiction other than the Nevis.
d. This
Agreement and the Securities Purchase Agreement constitute the entire agreement among the parties hereto with respect to the subject
matter hereof and thereof. There are no restrictions, promises, warranties or undertakings, other than those set forth or referred to
herein and therein. This Agreement and the Securities Purchase Agreement supersede all prior agreements and understandings among the
parties hereto with respect to the subject matter hereof and thereof.
e. Subject
to the requirements of Section 9, this Agreement shall inure to the benefit of and be binding upon the successors and permitted assigns
of each of the parties hereto.
f. The
headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning hereof.
g. This
Agreement may be executed in identical counterparts, each of which shall be deemed an original but all of which shall constitute one
and the same agreement. This Agreement, once executed by a party, may be delivered to the other party hereto by facsimile transmission
or by e-mail in a “.pdf” format data file of a copy of this Agreement bearing the signature of the party so delivering this
Agreement.
h. Each
party shall do and perform, or cause to be done and performed, all such further acts and things, and shall execute and deliver all such
other agreements, certificates, instruments and documents, as the other party may reasonably request in order to carry out the intent
and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby.
i. The
language used in this Agreement will be deemed to be the language chosen by the parties to express their mutual intent and no rules of
strict construction will be applied against any party.
j. This
Agreement is intended for the benefit of the parties hereto and their respective successors and permitted assigns, and is not for the
benefit of, nor may any provision hereof be enforced by, any other Person.
*
* * * * *
IN
WITNESS WHEREOF, the parties have caused this Agreement to be duly executed as of day and year first above written.
| THE COMPANY: |
|
| |
|
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| BRUUSH ORAL CARE, INC. |
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| |
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| By: |
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| Name:
|
Aneil
Singh Manhas |
|
| Title:
|
Chief
Executive Officer |
|
| |
|
|
| INVESTOR: |
|
| |
|
| INVESTOR |
|
| |
|
|
| By: |
|
|
| Name: |
|
|
| Title: |
|
|
[Signature
Page to registration rights agreement]
EXHIBIT
A
TO
REGISTRATION RIGHTS AGREEMENT
FORM
OF NOTICE OF EFFECTIVENESS
OF
REGISTRATION STATEMENT
______,
2023
Endeavor
Trust Corporation
Suite
702 - 777 Hornby Street, Vancouver, BC, V6Z 1S4
mark.trendell-jensen@endeavortrust.com
admin@endeavortrust.com
(604)
559-8880
Re:
Effectiveness of Registration Statement
Ladies
and Gentlemen:
We
are counsel to Bruush Oral Care, Inc., a corporation incorporated in British Columbia, Canada, (the “Company”), and
have represented the Company in connection with that certain Securities Purchase Agreement, dated as of October 2, 2023 (the “Purchase
Agreement”), entered into by and between the Company and _______ (the “Investor”) pursuant to which
the Company has agreed to issue to the Investor common shares of the Company, no par value per share, consisting of the Shares (as defined
in this Agreement). In connection with the transactions contemplated by the Purchase Agreement, the Company has registered with the U.S.
Securities and Exchange Commission the following Common Shares:
| (1) | 79,724
Shares issued to the Investor in accordance with the Purchase Agreement and 15,531,146 shares
issuable upon exercise of the Warrants; |
Pursuant
to the Purchase Agreement, the Company also has entered into a Registration Rights Agreement, of even date with the Purchase Agreement,
with the Investor (the “Registration Rights Agreement”) pursuant to which the Company has agreed, among other things,
to register the Shares under the Securities Act of 1933, as amended (the “Securities Act”). In connection with the
Company’s obligations under the Purchase Agreement and the Registration Rights Agreement, on October 2, 2023, the Company filed
a Registration Statement (File No. 333-[_________]) (the “Registration Statement”) with the Securities and Exchange
Commission (the “SEC”) relating to the resale of the Shares and Warrant Shares.
In
connection with the foregoing, we advise you that a member of the SEC’s staff has advised us by telephone that the SEC has entered
an order declaring the Registration Statement effective under the Securities Act at [_____] [A.M./P.M.] on [__________], 2023 and we
have no knowledge, after telephonic inquiry of a member of the SEC’s staff, that any stop order suspending its effectiveness has
been issued or that any proceedings for that purpose are pending before, or threatened by, the SEC and the Shares and Warrant Shares
are available for resale under the Securities Act pursuant to the Registration Statement and may be issued without any restrictive legend.
| |
Very
truly yours, |
| |
[Company
Counsel] |
| |
|
| |
By: |
|
Exhibit
10.3
NEITHER
THIS SECURITY NOR THE SECURITIES AS TO WHICH THIS SECURITY MAY BE EXERCISED HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION
OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS
OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR
TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY. THIS SECURITY AND THE SECURITIES ISSUABLE UPON
EXERCISE OF THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.
Warrant
“A”
PREFUNDED
COMMON SHARE PURCHASE WARRANT
BRUUSH
ORAL CARE, INC.
Warrant
Shares: 7,818,146
Date
of Issuance: October 2, 2023 (“Issuance Date”)
This
PREFUNDED COMMON SHARE PURCHASE WARRANT (the “Warrant”) certifies that, for value received (in connection with the
issuance of the Shares (as defined in the Purchase Agreement (as defined below) to the Holder (as defined below), _______ a Saint
Kitts and Nevis Company (including any permitted and registered assigns, the “Holder”), is entitled, upon the terms
and subject to the limitations on exercise and the conditions hereinafter set forth, at any time on or after the date of issuance hereof,
BRUUSH ORAL CARE, INC., a corporation incorporated in British Columbia, Canada, with principal executive offices located at 128
West Hastings Street, Unit 210 Vancouver, British Columbia V6B 1G8 (the “Company”), 7,181,146
Common Shares (the “Warrant Shares”) (whereby such number may be adjusted from time to time pursuant to the
terms and conditions of this Warrant) at the Exercise Price per share then in effect. This Warrant is issued by the Company as of the
date hereof in connection with that certain securities purchase agreement dated as of October 2, 2023, by and among the Company and the
Holder (the “Purchase Agreement”).
Capitalized
terms used in this Warrant shall have the meanings set forth in the Purchase Agreement unless otherwise defined in the body of this Warrant
or in Section 12 below. For purposes of this Warrant, the term “Exercise Price” shall mean $0.0001, subject to adjustment
as provided herein, and the term “Exercise Period” shall mean the period commencing on the Issuance Date and ending
on 5:00 p.m. eastern standard time on the five-year anniversary thereof. The amount of funds to be paid to the Company upon the exercise
of this Warrant shall be zero as this is a warrant which has been fully paid for.
1. EXERCISE
OF WARRANT.
(a) Mechanics
of Exercise. Subject to the terms and conditions hereof, the rights represented by this Warrant may be exercised in whole or in part
at any time or times during the Exercise Period by delivery of a written notice, in the form attached hereto as Exhibit A (the
“Exercise Notice”), of the Holder’s election to exercise this Warrant. The Holder shall not be required to deliver
the original Warrant in order to effect an exercise hereunder. Partial exercises of this Warrant resulting in issuance of a portion of
the total number of Warrant Shares available hereunder shall have the effect of lowering the outstanding number of Warrant Shares issued
hereunder in an amount equal to the applicable number of Warrant Shares issued. On or before the second Trading Day (the “Warrant
Share Delivery Date”) following the date on which the Holder sent the Exercise Notice to the Company or the Company’s
transfer agent together with the Exercise Notice, the “Exercise Delivery Documents”), the Company shall (or direct
its transfer agent to) issue and dispatch by overnight courier to the address as specified in the Exercise Notice, a certificate, registered
in the Company’s share register in the name of the Holder or its designee, for the number of Common Shares to which the Holder
is entitled pursuant to such exercise (or deliver such Common Shares in electronic format if requested by the Holder). Upon delivery
of the Exercise Delivery Documents, the Holder shall be deemed for all corporate purposes to have become the holder of record of the
Warrant Shares with respect to which this Warrant has been exercised, irrespective of the date of delivery of the certificates evidencing
such Warrant Shares. If this Warrant is submitted in connection with any exercise and the number of Warrant Shares represented by this
Warrant submitted for exercise is greater than the number of Warrant Shares being acquired upon an exercise, then the Company shall as
soon as practicable and in no event later than three Business Days after any exercise and at its own expense, issue a new Warrant (in
accordance with Section 6) representing the right to issue the number of Warrant Shares issuable immediately prior to such exercise under
this Warrant, less the number of Warrant Shares with respect to which this Warrant is exercised.
If
the Company fails to cause its transfer agent to transmit to the Holder the respective Common Shares by the respective Warrant Share
Delivery Date, then the Holder will have the right to rescind such exercise in Holder’s sole discretion in addition to all other
rights and remedies at law, under this Warrant, or otherwise, and such failure shall also be deemed a material breach of this Warrant
and the Agreement.
(b) No
Fractional Shares. No fractional shares shall be issued upon the exercise of this Warrant as a consequence of any adjustment pursuant
hereto. All Warrant Shares (including fractions) issuable upon exercise of this Warrant may be aggregated for purposes of determining
whether the exercise would result in the issuance of any fractional share. If, after aggregation, the exercise would result in the issuance
of a fractional share, the Company shall, in lieu of issuance of any fractional share, pay the Holder otherwise entitled to such fraction
a sum in cash equal to the product resulting from multiplying the then-current fair market value of a Warrant Share by such fraction.
(c)
Holder’s Exercise Limitations. Notwithstanding anything to the contrary contained herein, the Company shall not effect any
exercise of this Warrant, and a Holder shall not have the right to exercise any portion of this Warrant, pursuant to Section 1 or otherwise,
to the extent that after giving effect to such issuance after exercise as set forth on the applicable Notice of Exercise, the Holder
(together with the Holder’s affiliates (the “Affiliates”), and any other Persons acting as a group together with the
Holder or any of the Holder’s Affiliates (such Persons, “Attribution Parties”)), would beneficially own in excess of
the Beneficial Ownership Limitation (as defined below). For purposes of the foregoing sentence, the number of Common Shares beneficially
owned by the Holder and Attribution Parties shall include the number of Common Shares issuable upon exercise of this Warrant with respect
to which such determination is being made, but shall exclude the number of Common Shares which would be issuable upon (i) exercise of
the remaining, nonexercised portion of this Warrant beneficially owned by the Holder or any of its Affiliates or Attribution Parties
and (ii) exercise or conversion of the unexercised or nonconverted portion of any other securities of the Company (including, without
limitation, any other Common Share Equivalents) subject to a limitation on conversion or exercise analogous to the limitation contained
herein beneficially owned by the Holder or any of its Affiliates or Attribution Parties. Except as set forth in the preceding sentence,
for purposes of this Section 1(c), beneficial ownership shall be calculated in accordance with Section 13(d) of the Exchange Act and
the rules and regulations promulgated thereunder, it being acknowledged by the Holder that the Holder is solely responsible for any schedules
required to be filed in accordance therewith. In addition, a determination as to any group status as contemplated above shall be determined
in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder. For purposes of this Section
1(c), in determining the number of outstanding Common Shares, a Holder may rely on the number of outstanding Common Shares as reflected
in (A) the Company’s most recent periodic or annual report filed with the Commission, as the case may be, (B) a more recent public
announcement by the Company or (C) a more recent written notice by the Company or the Company’s transfer agent setting forth the
number of Common Shares outstanding. Upon the written or oral request of a Holder, the Company shall within two Trading Days confirm
orally and in writing to the Holder the number of Common Shares then outstanding. In any case, the number of outstanding Common Shares
shall be determined after giving effect to the conversion or exercise of securities of the Company, including this Warrant, by the Holder
or its Affiliates or Attribution Parties since the date as of which such number of outstanding Common Shares was reported. The “Beneficial
Ownership Limitation” shall be 4.99% of the number of Common Shares outstanding at the time of the respective calculation hereunder.
The limitations contained in this paragraph shall apply to a successor holder of this Warrant.
(d)
Compensation for Buy-In on Failure to Timely Deliver Warrant Shares Upon Exercise. In addition to any other rights available to
the Holder, if the Company fails to cause the Company’s transfer agent to transmit to the Holder the Warrant Shares in accordance
with the provisions of this Warrant (including but not limited to Section 1(a) above pursuant to an exercise on or before the respective
Warrant Share Delivery Date, and if after such date the Holder is required by its broker to purchase (in an open market transaction or
otherwise) or the Holder’s brokerage firm otherwise purchases, Common Shares to deliver in satisfaction of a sale by the Holder
of the Warrant Shares which the Holder anticipated receiving upon such exercise (a “Buy-In”), then the Company shall (A)
pay in cash to the Holder, within one (1) business day of Holder’s request, the amount, if any, by which (x) the Holder’s
total purchase price (including brokerage commissions, if any) for the Common Shares so purchased exceeds (y) the product of (1) the
number of Warrant Shares that the Company was required to deliver to the Holder in connection with the exercise at issue times (2) the
price at which the sell order giving rise to such purchase obligation was executed, and (B) at the option of the Holder, either reinstate
the portion of the Warrant and equivalent number of Warrant Shares for which such exercise was not honored (in which case such exercise
shall be deemed rescinded) or deliver to the Holder within one (1) business day of Holder’s request the number of Common Shares
that would have been issued had the Company timely complied with its exercise and delivery obligations hereunder. For example, if the
Holder purchases, or effectuates a cashless exercise hereunder for, Common Shares having a total purchase price of $11,000 to cover a
Buy-In with respect to an attempted exercise of Common Shares with an aggregate sale price giving rise to such purchase obligation of
$10,000, under clause (A) of the immediately preceding sentence, the Company shall be required to pay the Holder $1,000. The Holder shall
provide the Company written notice indicating the amounts payable to the Holder in respect of the Buy-In and, upon request of the Company,
evidence of the amount of such loss. Nothing herein shall limit a Holder’s right to pursue any other remedies available to it hereunder,
at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief with respect to the Company’s
failure to timely deliver Common Shares upon exercise of the Warrant as required pursuant to the terms hereof.
2. ADJUSTMENTS.
The Exercise Price and the number of Warrant Shares shall be adjusted from time to time as follows:
(a) Distribution
of Assets. If the Company shall declare or make any dividend or other distribution of its assets (or rights to acquire its assets)
to holders of Common Shares, by way of return of capital or otherwise (including without limitation any distribution of cash, stock or
other securities, property or options by way of a dividend, spin off, reclassification, corporate rearrangement or other similar transaction
(a “Distribution”), at any time after the issuance of this Warrant, then, in each such case:
(i) any
Exercise Price in effect immediately prior to the close of business on the record date fixed for the determination of holders of Common
Shares entitled to receive the Distribution shall be reduced, effective as of the close of business on such record date, to a price determined
by multiplying such Exercise Price by a fraction (i) the numerator of which shall be the Closing Sale Price of the Common Shares on the
Trading Day immediately preceding such record date minus the value of the Distribution (as determined in good faith by the Company’s
Board of Directors) applicable to one Common Share, and (ii) the denominator of which shall be the Closing Sale Price of the Common Shares
on the Trading Day immediately preceding such record date; and
(ii) the
number of Warrant Shares shall be increased to a number of shares equal to the number of Common Shares obtainable immediately prior to
the close of business on the record date fixed for the determination of holders of Common Shares entitled to receive the Distribution
multiplied by the reciprocal of the fraction set forth in the immediately preceding clause (i); provided, however, that in the event
that the Distribution is of shares of common stock of a company (other than the Company) whose common stock is traded on a national securities
exchange or a national automated quotation system (“Other Shares of Common Stock”), then the Holder may elect to receive
a warrant to have issued Other Shares of Common Stock in lieu of an increase in the number of Warrant Shares, the terms of which shall
be identical to those of this Warrant, except that such warrant shall be exercisable into the number of shares of Other Shares of Common
Stock that would have been payable to the Holder pursuant to the Distribution had the Holder exercised this Warrant immediately prior
to such record date and with an aggregate exercise price equal to the product of the amount by which the exercise price of this Warrant
was decreased with respect to the Distribution pursuant to the terms of the immediately preceding clause (i) and the number of Warrant
Shares calculated in accordance with the first part of this clause (ii).
(b) Anti-Dilution
Adjustments to Exercise Price. If the Company or any Subsidiary thereof, as applicable, at any time while this Warrant is outstanding,
shall sell or grant any option to purchase, or sell or grant any right to reprice, or otherwise dispose of or issue (or announce any
offer, sale, grant or any option to purchase or other disposition) any Common Shares or securities entitling any person or entity (which,
for purposes of clarification, shall not include any Common Shares issued to the Holder pursuant to (i) any other security of the Company
currently held by Holder, (ii) any other security of the Company issued to Holder on or after the Issuance Date, or (iii) any other agreement
entered into between the Company and Holder) to acquire Common Shares (upon conversion, exercise or otherwise), at an effective price
per share less than the then Exercise Price (such lower price, the “Base Share Price” and such issuances collectively, a
“Dilutive Issuance”) (if the holder of the Common Shares or Common Share Equivalents so issued shall at any time, whether
by operation of purchase price adjustments, elimination of an applicable floor price for any reason in the future (including but not
limited to the passage of time or satisfaction of certain condition(s)), reset provisions, floating conversion, exercise or exchange
prices or otherwise, or due to warrants, options or rights per share which are issued in connection with such issuance, be entitled or
potentially entitled to receive Common Shares at an effective price per share which is less than the Exercise Price at any time while
such Common Shares or Common Share Equivalents are in existence, such issuance shall be deemed to have occurred for less than the Exercise
Price on such date of the Dilutive Issuance (regardless of whether the Common Shares or Common Share Equivalents are (i) subsequently
redeemed or retired by the Company after the date of the Dilutive Issuance or (ii) actually converted or exercised at such Base Share
Price), then the Exercise Price shall be reduced at the option of the Holder and only reduced to equal the Base Share Price. The Company
shall notify the Holder in writing, no later than the Trading Day following the issuance of any Common Shares or Common Share Equivalents
subject to this Section 2(b), indicating therein the applicable issuance price, or applicable reset price, exchange price, conversion
price and other pricing terms (such notice the “Dilutive Issuance Notice”). For purposes of clarification, whether or not
the Company provides a Dilutive Issuance Notice pursuant to this Section 2(b), upon the occurrence of any Dilutive Issuance, after the
date of such Dilutive Issuance the Holder is entitled to receive a number of Warrant Shares based upon the Base Share Price regardless
of whether the Holder accurately refers to the Base Share Price in the Notice of Exercise.
(c)
Subdivision or Combination of the Common Shares. If the Company at any time on or after the issuance date of this Warrant (“Issuance
Date”), subdivides (by any stock split, stock dividend, recapitalization or otherwise) one or more classes of its outstanding Common
Shares into a greater number of shares, the Exercise Price in effect immediately prior to such subdivision will be proportionately reduced
and the number of Warrant Shares will be proportionately increased. Any adjustment under this section shall become effective at the close
of business on the date the subdivision or combination becomes effective. Each such adjustment of the Exercise Price shall be calculated
to the nearest one-hundredth of a cent. Such adjustment shall be made successively whenever any event covered by this section shall occur.
3. FUNDAMENTAL
TRANSACTIONS. If, at any time while this Warrant is outstanding, (i) the Company effects any merger of the Company with or into another
entity and the Company is not the surviving entity (such surviving entity, the “Successor Entity”), (ii) the Company
effects any sale of all or substantially all of its assets in one or a series of related transactions, (iii) any tender offer or exchange
offer (whether by the Company or by another individual or entity, and approved by the Company) is completed pursuant to which holders
of the Common Shares are permitted to tender or exchange their Common Shares for other securities, cash or property and the holders of
at least 50% of the Common Shares accept such offer, or (iv) the Company effects any reclassification of the Common Shares or any compulsory
share exchange pursuant to which the Common Shares are effectively converted into or exchanged for other securities, cash or property
(other than as a result of a subdivision or combination of Common Shares) (in any such case, a “Fundamental Transaction”),
then, upon any subsequent exercise of this Warrant, the Holder shall have the right to receive the number of Common Shares of the Successor
Entity or of the Company and any additional consideration (the “Alternate Consideration”) receivable upon or as a
result of such reorganization, reclassification, merger, consolidation or disposition of assets by a holder of the number of Common Shares
for which this Warrant is exercisable immediately prior to such event (disregarding any limitation on exercise contained herein solely
for the purpose of such determination). For purposes of any such exercise, the determination of the Exercise Price shall be appropriately
adjusted to apply to such Alternate Consideration based on the amount of Alternate Consideration issuable in respect of one Common Share
in such Fundamental Transaction, and the Company shall apportion the Exercise Price among the Alternate Consideration in a reasonable
manner reflecting the relative value of any different components of the Alternate Consideration. If holders of Common Shares are given
any choice as to the securities, cash or property to be received in a Fundamental Transaction, then the Holder shall be given the same
choice as to the Alternate Consideration it receives upon any exercise of this Warrant following such Fundamental Transaction. To the
extent necessary to effectuate the foregoing provisions, any Successor Entity in such Fundamental Transaction shall issue to the Holder
a new warrant consistent with the foregoing provisions and evidencing the Holder’s right to exercise such warrant into Alternate
Consideration.
4. NON-CIRCUMVENTION.
The Company covenants and agrees that it will not, by amendment of its certificate of incorporation, bylaws or through any reorganization,
transfer of assets, consolidation, merger, scheme of arrangement, dissolution, issue or sale of securities, or any other voluntary action,
avoid or seek to avoid the observance or performance of any of the terms of this Warrant, and will at all times in good faith carry out
all the provisions of this Warrant and take all action as may be required to protect the rights of the Holder. Without limiting the generality
of the foregoing, the Company (i) shall not increase the par value of any Common Shares receivable upon the exercise of this Warrant
above the Exercise Price then in effect, (ii) shall take all such actions as may be necessary or appropriate in order that the Company
may validly and legally issue fully paid and non-assessable Common Shares upon the exercise of this Warrant, and (iii) shall, for so
long as this Warrant is outstanding, have authorized and reserved, free from preemptive rights, ten times the number of Common Shares
into which the Warrants are then exercisable into to provide for the exercise of the rights represented by this Warrant (without regard
to any limitations on exercise).
5. WARRANT
HOLDER NOT DEEMED A STOCKHOLDER. Except as otherwise specifically provided herein, this Warrant, in and of itself, shall not entitle
the Holder to any voting rights or other rights as a stockholder of the Company. In addition, nothing contained in this Warrant shall
be construed as imposing any liabilities on the Holder to purchase any securities (upon exercise of this Warrant or otherwise) or as
a stockholder of the Company, whether such liabilities are asserted by the Company or by creditors of the Company.
6. REISSUANCE.
(a) Lost,
Stolen or Mutilated Warrant. If this Warrant is lost, stolen, mutilated or destroyed, the Company will, on such terms as to indemnity
or otherwise as it may reasonably impose (which shall, in the case of a mutilated Warrant, include the surrender thereof), issue a new
Warrant of like denomination and tenor as this Warrant so lost, stolen, mutilated or destroyed.
(b) Issuance
of New Warrants. Whenever the Company is required to issue a new Warrant pursuant to the terms of this Warrant, such new Warrant
shall be of like tenor with this Warrant, and shall have an issuance date, as indicated on the face of such new Warrant which is the
same as the Issuance Date.
7. NOTICES.
Whenever notice is required to be given under this Warrant, unless otherwise provided herein, such notice shall be given in accordance
with the notice provisions contained in the Purchase Agreement. The Company shall provide the Holder with prompt written notice (i) immediately
upon any adjustment of the Exercise Price, setting forth in reasonable detail, the calculation of such adjustment and (ii) at least 20
days prior to the date on which the Company closes its books or takes a record (A) with respect to any dividend or distribution upon
the Common Shares, (B) with respect to any grants, issuances or sales of any stock or other securities directly or indirectly convertible
into or exercisable or exchangeable for Common Shares or other property, pro rata to the holders of Common Shares or (C) for determining
rights to vote with respect to any Fundamental Transaction, dissolution or liquidation, provided in each case that such information shall
be made known to the public prior to or in conjunction with such notice being provided to the Holder.
8.
TRANSFER. This Warrant shall be binding upon the Company and its successors and assigns, and shall inure to be the benefit of
the Holder and its successors and assigns. Notwithstanding anything to the contrary herein, the rights, interests or obligations of the
Company hereunder may not be assigned, by operation of law or otherwise, in whole or in part, by the Company without the prior signed
written consent of the Holder, which consent may be withheld at the sole discretion of the Holder (any such assignment or transfer shall
be null and void if the Company does not obtain the prior signed written consent of the Holder). This Warrant or any of the severable
rights and obligations inuring to the benefit of or to be performed by Holder hereunder may be assigned by Holder to a third party, in
whole or in part, without the need to obtain the Company’s consent thereto. Any transferee of all or a portion of this Warrant
shall succeed to the rights and benefits of the initial Holder of this Warrant and the Securities Purchase Agreement.
9. AMENDMENT
AND WAIVER. The terms of this Warrant may be amended or waived (either generally or in a particular instance and either retroactively
or prospectively) only with the written consent of the Company and the Holder.
10.
GOVERNING LAW. This Warrant shall be deemed executed, delivered and performed in Saint Kitts and Nevis (“Nevis”).
This Warrant shall be solely and exclusively governed by and construed in accordance with the laws of Nevis without regard to principles
of conflicts of laws. The parties hereby warrant and represent that the selection of Nevis law as the sole and exclusive governing law
under this Warrant (i) has a reasonable nexus to each of the parties and to the transactions contemplated by the Warrant; and (ii) does
not offend any public policy of the Nevis, or of any other jurisdiction. The Company irrevocably and exclusively consents to and expressly
agrees that binding arbitration in Nevis conducted by the Arbitrator Conflict Resolution Centre shall be their sole and exclusive remedy
for any dispute arising out of or relating to this Warrant, Agreement, Irrevocable Instructions or any other agreement between the parties,
the Company’s transfer agent or the relationship of the parties or their affiliates, and that the arbitration shall be conducted
via telephone or teleconference. If the Arbitrator is not available, a different arbitrator or law firm in Nevis shall be chosen by the
Lender and agreed upon by the Company. Company covenants and agrees to provide written notice to Lender via email prior to bringing any
action or arbitration action against the Company’s transfer agent or any action against any person or entity that is not a party
to this Agreement that is related in any way to this Agreement or any of the Exhibits under this Agreement or any transaction contemplated
herein or therein, and further agrees to timely notify Lender to any such action. Company acknowledges that the governing law and venue
provisions set forth in this Agreement are material terms to induce Lender to enter into the Transaction Documents and that but for Company’s
agreements set forth in this section, Lender would not have entered into the Transaction Documents. In the event that the Lender needs
to take action to protect their rights under the Loan, the Lender may commence action in any jurisdiction needed with the understanding
that the Agreement shall still be solely and exclusively construed and enforced in accordance with, and all questions concerning the
construction, validity, interpretation and performance of this Agreement shall be governed solely and exclusively by the internal laws
of Nevis, without giving effect to any choice of law or conflict of law provision or rule (whether of Nevis or any other jurisdiction)
that would cause the application of the laws of any jurisdiction other than the Nevis.
11. ACCEPTANCE.
Receipt of this Warrant by the Holder shall constitute acceptance of and agreement to all of the terms and conditions contained herein.
12. CERTAIN
DEFINITIONS. For purposes of this Warrant, the following terms shall have the following meanings:
(a) “Nasdaq”
means www.Nasdaq.com.
(b) “Closing
Sale Price” means, for any security as of any date, (i) the last closing trade price for such security on the Principal Market,
as reported by Nasdaq, or, if the Principal Market begins to operate on an extended hours basis and does not designate the closing trade
price, then the last trade price of such security prior to 4:00 p.m., New York time, as reported by Nasdaq, or (ii) if the foregoing
does not apply, the last trade price of such security in the over-the-counter market for such security as reported by Nasdaq, or (iii)
if no last trade price is reported for such security by Nasdaq, the average of the bid and ask prices of any market makers for such security
as reported by the OTC Markets. If the Closing Sale Price cannot be calculated for a security on a particular date on any of the foregoing
bases, the Closing Sale Price of such security on such date shall be the fair market value as mutually determined by the Company and
the Holder. All such determinations to be appropriately adjusted for any stock dividend, stock split, stock combination or other similar
transaction during the applicable calculation period.
(c) “Common
Shares” means the common shares of the Company, no par value, and any other class of securities into which such securities
may hereafter be reclassified or changed.
(d) “Common
Share Equivalents” means any securities of the Company that would entitle the holder thereof to acquire at any time Common
Shares, including without limitation any debt, preferred stock, rights, options, warrants or other instrument that is at any time convertible
into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive, Common Shares.
(e)
“Person” and “Persons” means an individual, a limited liability company, a partnership, a joint
venture, a corporation, a trust, an unincorporated organization, any other entity and any governmental entity or any department or agency
thereof.
(g) “Principal
Market” means the primary national securities exchange on which the Common Shares are then traded.
(h) “Market
Price” means the volume weighted average price of the Common Shares one Trading Day prior to the date of the respective Exercise
Notice.
(i) “Trading
Day” means (i) any day on which the Common Shares are listed or quoted and traded on its Principal Market, (ii) if the Common
Shares are not then listed or quoted and traded on any national securities exchange, then a day on which trading occurs on any over-the-counter
markets, or (iii) if trading does not occur on the over-the-counter markets, any Business Day.
*
* * * * * *
IN WITNESS WHEREOF, the Company has caused this
Warrant to be duly executed as of the Issuance Date set forth above.
| BRUUSH
ORAL CARE, INC. |
|
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| By: |
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| Name:
|
Aneil
Singh Manhas |
|
| Title:
|
Chief
Executive Officer |
|
EXHIBIT
A
EXERCISE
NOTICE
(To
be executed by the registered holder to exercise this Common Share Purchase Warrant)
| 1. | The
Undersigned holder
hereby exercises the right to have issued _________________ of the Common Shares (“Warrant
Shares”) of BRUUSH ORAL CARE, INC., a corporation incorporated in British Columbia,
Canada, the “Company”), evidenced by the attached copy of the Common Share Purchase
Warrant A (the “Warrant”). Capitalized terms used herein and not otherwise defined
shall have the respective meanings set forth in the Warrant. The amount of funds to be paid
to the Company upon the exercise of this Warrant shall be zero as this is a prefunded warrant
which has already been fully paid for. |
| | | |
| 2. | |
| | | |
| 3. | Delivery
of Warrant Shares. The Company shall deliver to the holder __________________ Warrant
Shares in accordance with the terms of the Warrant. |
| Date:
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(Print Name of Registered Holder) |
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By:
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Name:
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Title:
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EXHIBIT
B
ASSIGNMENT
OF WARRANT
(To
be signed only upon authorized transfer of the Warrant)
For
Value Received, the undersigned hereby sells, assigns,
and transfers unto ____________________ the right to purchase _______________ shares of common shares of BRUUSH ORAL CARE, INC.,
to which the Common Share Purchase Warrant relates and appoints ____________________, as attorney-in-fact, to transfer said right on
the books of BRUUSH ORAL CARE, INC. with full power of substitution and re-substitution in the premises. By accepting such transfer,
the transferee has agreed to be bound in all respects by the terms and conditions of the within Warrant.
| Dated:
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(Signature)
* |
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(Name) |
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(Address) |
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(Social
Security or Tax Identification No.) |
*
The signature on this Assignment of Warrant must correspond to the name as written upon the face of the Common Share Purchase Warrant
in every particular without alteration or enlargement or any change whatsoever. When signing on behalf of a corporation, partnership,
trust or other entity, please indicate your position(s) and title(s) with such entity.
Exhibit
10.4
NEITHER
THIS SECURITY NOR THE SECURITIES AS TO WHICH THIS SECURITY MAY BE EXERCISED HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION
OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS
OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR
TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY. THIS SECURITY AND THE SECURITIES ISSUABLE UPON
EXERCISE OF THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.
Warrant
“B”
COMMON
SHARE PURCHASE WARRANT
BRUUSH
ORAL CARE, INC.
Warrant
Shares: 8,350,000
Date
of Issuance: October 2, 2023 (“Issuance Date”)
This
COMMON SHARE PURCHASE WARRANT (the “Warrant”) certifies that, for value received (in connection with the issuance
of the Shares (as defined in the Purchase Agreement (as defined below) to the Holder (as defined below), _______, a Saint Kitts
and Nevis Company (including any permitted and registered assigns, the “Holder”), is entitled, upon the terms and
subject to the limitations on exercise and the conditions hereinafter set forth, at any time on or after the date of issuance hereof,
BRUUSH ORAL CARE, INC., a corporation incorporated in British Columbia, Canada, with principal executive offices located at 128
West Hastings Street, Unit 210 Vancouver, British Columbia V6B 1G8 (the “Company”), 8,350,000
Common Shares (the “Warrant Shares”) (whereby such number may be adjusted from time to time pursuant to the
terms and conditions of this Warrant) at the Exercise Price per share then in effect. This Warrant is issued by the Company as of the
date hereof in connection with that certain securities purchase agreement dated as of October 2, 2023, by and among the Company and the
Holder (the “Purchase Agreement”).
Capitalized
terms used in this Warrant shall have the meanings set forth in the Purchase Agreement unless otherwise defined in the body of this Warrant
or in Section 12 below. For purposes of this Warrant, the term “Exercise Price” shall mean $0.0001, subject to adjustment
as provided herein, and the term “Exercise Period” shall mean the period commencing on the Issuance Date and ending
on 5:00 p.m. eastern standard time on the five-year anniversary thereof.
1. EXERCISE
OF WARRANT.
(a) Mechanics
of Exercise. Subject to the terms and conditions hereof, the rights represented by this Warrant may be exercised in whole or in part
at any time or times during the Exercise Period by delivery of a written notice, in the form attached hereto as Exhibit A (the
“Exercise Notice”), of the Holder’s election to exercise this Warrant. The Holder shall not be required to deliver
the original Warrant in order to effect an exercise hereunder. Partial exercises of this Warrant resulting in issuance of a portion of
the total number of Warrant Shares available hereunder shall have the effect of lowering the outstanding number of Warrant Shares issued
hereunder in an amount equal to the applicable number of Warrant Shares issued. On or before the second Trading Day (the “Warrant
Share Delivery Date”) following the date on which the Holder sent the Exercise Notice to the Company or the Company’s
transfer agent together with the Exercise Notice, the “Exercise Delivery Documents”), the Company shall (or direct
its transfer agent to) issue and dispatch by overnight courier to the address as specified in the Exercise Notice, a certificate, registered
in the Company’s share register in the name of the Holder or its designee, for the number of Common Shares to which the Holder
is entitled pursuant to such exercise (or deliver such Common Shares in electronic format if requested by the Holder). Upon delivery
of the Exercise Delivery Documents, the Holder shall be deemed for all corporate purposes to have become the holder of record of the
Warrant Shares with respect to which this Warrant has been exercised, irrespective of the date of delivery of the certificates evidencing
such Warrant Shares. If this Warrant is submitted in connection with any exercise and the number of Warrant Shares represented by this
Warrant submitted for exercise is greater than the number of Warrant Shares being acquired upon an exercise, then the Company shall as
soon as practicable and in no event later than three Business Days after any exercise and at its own expense, issue a new Warrant (in
accordance with Section 6) representing the right to issue the number of Warrant Shares issuable immediately prior to such exercise under
this Warrant, less the number of Warrant Shares with respect to which this Warrant is exercised.
If
the Company fails to cause its transfer agent to transmit to the Holder the respective Common Shares by the respective Warrant Share
Delivery Date, then the Holder will have the right to rescind such exercise in Holder’s sole discretion in addition to all other
rights and remedies at law, under this Warrant, or otherwise, and such failure shall also be deemed a material breach of this Warrant
and the Agreement.
(b) No
Fractional Shares. No fractional shares shall be issued upon the exercise of this Warrant as a consequence of any adjustment pursuant
hereto. All Warrant Shares (including fractions) issuable upon exercise of this Warrant may be aggregated for purposes of determining
whether the exercise would result in the issuance of any fractional share. If, after aggregation, the exercise would result in the issuance
of a fractional share, the Company shall, in lieu of issuance of any fractional share, pay the Holder otherwise entitled to such fraction
a sum in cash equal to the product resulting from multiplying the then-current fair market value of a Warrant Share by such fraction.
(c)
Holder’s Exercise Limitations. Notwithstanding anything to the contrary contained herein, the Company shall not effect any
exercise of this Warrant, and a Holder shall not have the right to exercise any portion of this Warrant, pursuant to Section 1 or otherwise,
to the extent that after giving effect to such issuance after exercise as set forth on the applicable Notice of Exercise, the Holder
(together with the Holder’s affiliates (the “Affiliates”), and any other Persons acting as a group together with the
Holder or any of the Holder’s Affiliates (such Persons, “Attribution Parties”)), would beneficially own in excess of
the Beneficial Ownership Limitation (as defined below). For purposes of the foregoing sentence, the number of Common Shares beneficially
owned by the Holder and Attribution Parties shall include the number of Common Shares issuable upon exercise of this Warrant with respect
to which such determination is being made, but shall exclude the number of Common Shares which would be issuable upon (i) exercise of
the remaining, nonexercised portion of this Warrant beneficially owned by the Holder or any of its Affiliates or Attribution Parties
and (ii) exercise or conversion of the unexercised or nonconverted portion of any other securities of the Company (including, without
limitation, any other Common Share Equivalents) subject to a limitation on conversion or exercise analogous to the limitation contained
herein beneficially owned by the Holder or any of its Affiliates or Attribution Parties. Except as set forth in the preceding sentence,
for purposes of this Section 1(c), beneficial ownership shall be calculated in accordance with Section 13(d) of the Exchange Act and
the rules and regulations promulgated thereunder, it being acknowledged by the Holder that the Holder is solely responsible for any schedules
required to be filed in accordance therewith. In addition, a determination as to any group status as contemplated above shall be determined
in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder. For purposes of this Section
1(c), in determining the number of outstanding Common Shares, a Holder may rely on the number of outstanding Common Shares as reflected
in (A) the Company’s most recent periodic or annual report filed with the Commission, as the case may be, (B) a more recent public
announcement by the Company or (C) a more recent written notice by the Company or the Company’s transfer agent setting forth the
number of Common Shares outstanding. Upon the written or oral request of a Holder, the Company shall within two Trading Days confirm
orally and in writing to the Holder the number of Common Shares then outstanding. In any case, the number of outstanding Common Shares
shall be determined after giving effect to the conversion or exercise of securities of the Company, including this Warrant, by the Holder
or its Affiliates or Attribution Parties since the date as of which such number of outstanding Common Shares was reported. The “Beneficial
Ownership Limitation” shall be 4.99% of the number of Common Shares outstanding at the time of the respective calculation hereunder.
The limitations contained in this paragraph shall apply to a successor holder of this Warrant.
(d)
Compensation for Buy-In on Failure to Timely Deliver Warrant Shares Upon Exercise. In addition to any other rights available to
the Holder, if the Company fails to cause the Company’s transfer agent to transmit to the Holder the Warrant Shares in accordance
with the provisions of this Warrant (including but not limited to Section 1(a) above pursuant to an exercise on or before the respective
Warrant Share Delivery Date, and if after such date the Holder is required by its broker to purchase (in an open market transaction or
otherwise) or the Holder’s brokerage firm otherwise purchases, Common Shares to deliver in satisfaction of a sale by the Holder
of the Warrant Shares which the Holder anticipated receiving upon such exercise (a “Buy-In”), then the Company shall (A)
pay in cash to the Holder, within one (1) business day of Holder’s request, the amount, if any, by which (x) the Holder’s
total purchase price (including brokerage commissions, if any) for the Common Shares so purchased exceeds (y) the product of (1) the
number of Warrant Shares that the Company was required to deliver to the Holder in connection with the exercise at issue times (2) the
price at which the sell order giving rise to such purchase obligation was executed, and (B) at the option of the Holder, either reinstate
the portion of the Warrant and equivalent number of Warrant Shares for which such exercise was not honored (in which case such exercise
shall be deemed rescinded) or deliver to the Holder within one (1) business day of Holder’s request the number of Common Shares
that would have been issued had the Company timely complied with its exercise and delivery obligations hereunder. For example, if the
Holder purchases, or effectuates a cashless exercise hereunder for, Common Shares having a total purchase price of $11,000 to cover a
Buy-In with respect to an attempted exercise of Common Shares with an aggregate sale price giving rise to such purchase obligation of
$10,000, under clause (A) of the immediately preceding sentence, the Company shall be required to pay the Holder $1,000. The Holder shall
provide the Company written notice indicating the amounts payable to the Holder in respect of the Buy-In and, upon request of the Company,
evidence of the amount of such loss. Nothing herein shall limit a Holder’s right to pursue any other remedies available to it hereunder,
at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief with respect to the Company’s
failure to timely deliver Common Shares upon exercise of the Warrant as required pursuant to the terms hereof.
2. ADJUSTMENTS.
The Exercise Price and the number of Warrant Shares shall be adjusted from time to time as follows:
(a) Distribution
of Assets. If the Company shall declare or make any dividend or other distribution of its assets (or rights to acquire its assets)
to holders of Common Shares, by way of return of capital or otherwise (including without limitation any distribution of cash, stock or
other securities, property or options by way of a dividend, spin off, reclassification, corporate rearrangement or other similar transaction
(a “Distribution”), at any time after the issuance of this Warrant, then, in each such case:
(i) any
Exercise Price in effect immediately prior to the close of business on the record date fixed for the determination of holders of Common
Shares entitled to receive the Distribution shall be reduced, effective as of the close of business on such record date, to a price determined
by multiplying such Exercise Price by a fraction (i) the numerator of which shall be the Closing Sale Price of the Common Shares on the
Trading Day immediately preceding such record date minus the value of the Distribution (as determined in good faith by the Company’s
Board of Directors) applicable to one Common Share, and (ii) the denominator of which shall be the Closing Sale Price of the Common Shares
on the Trading Day immediately preceding such record date; and
(ii) the
number of Warrant Shares shall be increased to a number of shares equal to the number of Common Shares obtainable immediately prior to
the close of business on the record date fixed for the determination of holders of Common Shares entitled to receive the Distribution
multiplied by the reciprocal of the fraction set forth in the immediately preceding clause (i); provided, however, that in the event
that the Distribution is of shares of common stock of a company (other than the Company) whose common stock is traded on a national securities
exchange or a national automated quotation system (“Other Shares of Common Stock”), then the Holder may elect to receive
a warrant to have issued Other Shares of Common Stock in lieu of an increase in the number of Warrant Shares, the terms of which shall
be identical to those of this Warrant, except that such warrant shall be exercisable into the number of shares of Other Shares of Common
Stock that would have been payable to the Holder pursuant to the Distribution had the Holder exercised this Warrant immediately prior
to such record date and with an aggregate exercise price equal to the product of the amount by which the exercise price of this Warrant
was decreased with respect to the Distribution pursuant to the terms of the immediately preceding clause (i) and the number of Warrant
Shares calculated in accordance with the first part of this clause (ii).
(b) Anti-Dilution
Adjustments to Exercise Price. If the Company or any Subsidiary thereof, as applicable, at any time while this Warrant is outstanding,
shall sell or grant any option to purchase, or sell or grant any right to reprice, or otherwise dispose of or issue (or announce any
offer, sale, grant or any option to purchase or other disposition) any Common Shares or securities entitling any person or entity (which,
for purposes of clarification, shall not include an Common Shares issued to the Holder pursuant to (i) any other security of the Company
currently held by Holder, (ii) any other security of the Company issued to Holder on or after the Issuance Date, or (iii) any other agreement
entered into between the Company and Holder) to acquire Common Shares (upon conversion, exercise or otherwise), at an effective price
per share less than the then Exercise Price (such lower price, the “Base Share Price” and such issuances collectively, a
“Dilutive Issuance”) (if the holder of the Common Shares or Common Share Equivalents so issued shall at any time, whether
by operation of purchase price adjustments, elimination of an applicable floor price for any reason in the future (including but not
limited to the passage of time or satisfaction of certain condition(s)), reset provisions, floating conversion, exercise or exchange
prices or otherwise, or due to warrants, options or rights per share which are issued in connection with such issuance, be entitled or
potentially entitled to receive Common Shares at an effective price per share which is less than the Exercise Price at any time while
such Common Shares or Common Share Equivalents are in existence, such issuance shall be deemed to have occurred for less than the Exercise
Price on such date of the Dilutive Issuance (regardless of whether the Common Shares or Common Share Equivalents are (i) subsequently
redeemed or retired by the Company after the date of the Dilutive Issuance or (ii) actually converted or exercised at such Base Share
Price), then the Exercise Price shall be reduced at the option of the Holder and only reduced to equal the Base Share Price. The Company
shall notify the Holder in writing, no later than the Trading Day following the issuance of any Common Shares or Common Share Equivalents
subject to this Section 2(b), indicating therein the applicable issuance price, or applicable reset price, exchange price, conversion
price and other pricing terms (such notice the “Dilutive Issuance Notice”). For purposes of clarification, whether or not
the Company provides a Dilutive Issuance Notice pursuant to this Section 2(b), upon the occurrence of any Dilutive Issuance, after the
date of such Dilutive Issuance the Holder is entitled to receive a number of Warrant Shares based upon the Base Share Price regardless
of whether the Holder accurately refers to the Base Share Price in the Notice of Exercise.
(c)
Subdivision or Combination of Common Shares. If the Company at any time on or after the issuance date of this Warrant (“Issuance
Date”), subdivides (by any stock split, stock dividend, recapitalization or otherwise) one or more classes of its outstanding Common
Shares into a greater number of shares, the Exercise Price in effect immediately prior to such subdivision will be proportionately reduced
and the number of Warrant Shares will be proportionately increased. Any adjustment under this section shall become effective at the close
of business on the date the subdivision or combination becomes effective. Each such adjustment of the Exercise Price shall be calculated
to the nearest one-hundredth of a cent. Such adjustment shall be made successively whenever any event covered by this section shall occur.
3. FUNDAMENTAL
TRANSACTIONS. If, at any time while this Warrant is outstanding, (i) the Company effects any merger of the Company with or into another
entity and the Company is not the surviving entity (such surviving entity, the “Successor Entity”), (ii) the Company
effects any sale of all or substantially all of its assets in one or a series of related transactions, (iii) any tender offer or exchange
offer (whether by the Company or by another individual or entity, and approved by the Company) is completed pursuant to which holders
of Common Shares are permitted to tender or exchange their Common Shares for other securities, cash or property and the holders of at
least 50% of the Common Shares accept such offer, or (iv) the Company effects any reclassification of the Common Shares or any compulsory
share exchange pursuant to which the Common Shares are effectively converted into or exchanged for other securities, cash or property
(other than as a result of a subdivision or combination of Common Shares) (in any such case, a “Fundamental Transaction”),
then, upon any subsequent exercise of this Warrant, the Holder shall have the right to receive the number of Common Shares of the Successor
Entity or of the Company and any additional consideration (the “Alternate Consideration”) receivable upon or as a
result of such reorganization, reclassification, merger, consolidation or disposition of assets by a holder of the number of Common Shares
for which this Warrant is exercisable immediately prior to such event (disregarding any limitation on exercise contained herein solely
for the purpose of such determination). For purposes of any such exercise, the determination of the Exercise Price shall be appropriately
adjusted to apply to such Alternate Consideration based on the amount of Alternate Consideration issuable in respect of one Common Share
in such Fundamental Transaction, and the Company shall apportion the Exercise Price among the Alternate Consideration in a reasonable
manner reflecting the relative value of any different components of the Alternate Consideration. If holders of Common Shares are given
any choice as to the securities, cash or property to be received in a Fundamental Transaction, then the Holder shall be given the same
choice as to the Alternate Consideration it receives upon any exercise of this Warrant following such Fundamental Transaction. To the
extent necessary to effectuate the foregoing provisions, any Successor Entity in such Fundamental Transaction shall issue to the Holder
a new warrant consistent with the foregoing provisions and evidencing the Holder’s right to exercise such warrant into Alternate
Consideration.
4. NON-CIRCUMVENTION.
The Company covenants and agrees that it will not, by amendment of its certificate of incorporation, bylaws or through any reorganization,
transfer of assets, consolidation, merger, scheme of arrangement, dissolution, issue or sale of securities, or any other voluntary action,
avoid or seek to avoid the observance or performance of any of the terms of this Warrant, and will at all times in good faith carry out
all the provisions of this Warrant and take all action as may be required to protect the rights of the Holder. Without limiting the generality
of the foregoing, the Company (i) shall not increase the par value of any Common Shares receivable upon the exercise of this Warrant
above the Exercise Price then in effect, (ii) shall take all such actions as may be necessary or appropriate in order that the Company
may validly and legally issue fully paid and non-assessable Common Shares upon the exercise of this Warrant, and (iii) shall, for so
long as this Warrant is outstanding, have authorized and reserved, free from preemptive rights, ten times the number of Common Shares
into which the Warrants are then exercisable into to provide for the exercise of the rights represented by this Warrant (without regard
to any limitations on exercise).
5. WARRANT
HOLDER NOT DEEMED A STOCKHOLDER. Except as otherwise specifically provided herein, this Warrant, in and of itself, shall not entitle
the Holder to any voting rights or other rights as a stockholder of the Company. In addition, nothing contained in this Warrant shall
be construed as imposing any liabilities on the Holder to purchase any securities (upon exercise of this Warrant or otherwise) or as
a stockholder of the Company, whether such liabilities are asserted by the Company or by creditors of the Company.
6. REISSUANCE.
(a) Lost,
Stolen or Mutilated Warrant. If this Warrant is lost, stolen, mutilated or destroyed, the Company will, on such terms as to indemnity
or otherwise as it may reasonably impose (which shall, in the case of a mutilated Warrant, include the surrender thereof), issue a new
Warrant of like denomination and tenor as this Warrant so lost, stolen, mutilated or destroyed.
(b) Issuance
of New Warrants. Whenever the Company is required to issue a new Warrant pursuant to the terms of this Warrant, such new Warrant
shall be of like tenor with this Warrant, and shall have an issuance date, as indicated on the face of such new Warrant which is the
same as the Issuance Date.
7. NOTICES.
Whenever notice is required to be given under this Warrant, unless otherwise provided herein, such notice shall be given in accordance
with the notice provisions contained in the Purchase Agreement. The Company shall provide the Holder with prompt written notice (i) immediately
upon any adjustment of the Exercise Price, setting forth in reasonable detail, the calculation of such adjustment and (ii) at least 20
days prior to the date on which the Company closes its books or takes a record (A) with respect to any dividend or distribution upon
the Common Shares, (B) with respect to any grants, issuances or sales of any stock or other securities directly or indirectly convertible
into or exercisable or exchangeable for Common Shares or other property, pro rata to the holders of Common Shares or (C) for determining
rights to vote with respect to any Fundamental Transaction, dissolution or liquidation, provided in each case that such information shall
be made known to the public prior to or in conjunction with such notice being provided to the Holder.
8.
TRANSFER. This Warrant shall be binding upon the Company and its successors and assigns, and shall inure to be the benefit of
the Holder and its successors and assigns. Notwithstanding anything to the contrary herein, the rights, interests or obligations of the
Company hereunder may not be assigned, by operation of law or otherwise, in whole or in part, by the Company without the prior signed
written consent of the Holder, which consent may be withheld at the sole discretion of the Holder (any such assignment or transfer shall
be null and void if the Company does not obtain the prior signed written consent of the Holder). This Warrant or any of the severable
rights and obligations inuring to the benefit of or to be performed by Holder hereunder may be assigned by Holder to a third party, in
whole or in part, without the need to obtain the Company’s consent thereto. Any transferee of all or a portion of this Warrant
shall succeed to the rights and benefits of the initial Holder of this Warrant and the Securities Purchase Agreement.
9. AMENDMENT
AND WAIVER. The terms of this Warrant may be amended or waived (either generally or in a particular instance and either retroactively
or prospectively) only with the written consent of the Company and the Holder.
10.
GOVERNING LAW. This Warrant shall be deemed executed, delivered and performed in Saint Kitts and Nevis (“Nevis”).
This Warrant shall be solely and exclusively governed by and construed in accordance with the laws of Nevis without regard to principles
of conflicts of laws. The parties hereby warrant and represent that the selection of Nevis law as the sole and exclusive governing law
under this Warrant (i) has a reasonable nexus to each of the parties and to the transactions contemplated by the Warrant; and (ii) does
not offend any public policy of the Nevis, or of any other jurisdiction. The Company irrevocably and exclusively consents to and expressly
agrees that binding arbitration in Nevis conducted by the Arbitrator Conflict Resolution Centre shall be their sole and exclusive remedy
for any dispute arising out of or relating to this Warrant, Agreement, Irrevocable Instructions or any other agreement between the parties,
the Company’s transfer agent or the relationship of the parties or their affiliates, and that the arbitration shall be conducted
via telephone or teleconference. If the Arbitrator is not available, a different arbitrator or law firm in Nevis shall be chosen by the
Lender and agreed upon by the Company. Company covenants and agrees to provide written notice to Lender via email prior to bringing any
action or arbitration action against the Company’s transfer agent or any action against any person or entity that is not a party
to this Agreement that is related in any way to this Agreement or any of the Exhibits under this Agreement or any transaction contemplated
herein or therein, and further agrees to timely notify Lender to any such action. Company acknowledges that the governing law and venue
provisions set forth in this Agreement are material terms to induce Lender to enter into the Transaction Documents and that but for Company’s
agreements set forth in this section, Lender would not have entered into the Transaction Documents. In the event that the Lender needs
to take action to protect their rights under the Loan, the Lender may commence action in any jurisdiction needed with the understanding
that the Agreement shall still be solely and exclusively construed and enforced in accordance with, and all questions concerning the
construction, validity, interpretation and performance of this Agreement shall be governed solely and exclusively by the internal laws
of Nevis, without giving effect to any choice of law or conflict of law provision or rule (whether of Nevis or any other jurisdiction)
that would cause the application of the laws of any jurisdiction other than the Nevis.
11. ACCEPTANCE.
Receipt of this Warrant by the Holder shall constitute acceptance of and agreement to all of the terms and conditions contained herein.
12. CERTAIN
DEFINITIONS. For purposes of this Warrant, the following terms shall have the following meanings:
(a) “Nasdaq”
means www.Nasdaq.com.
(b) “Closing
Sale Price” means, for any security as of any date, (i) the last closing trade price for such security on the Principal Market,
as reported by Nasdaq, or, if the Principal Market begins to operate on an extended hours basis and does not designate the closing trade
price, then the last trade price of such security prior to 4:00 p.m., New York time, as reported by Nasdaq, or (ii) if the foregoing
does not apply, the last trade price of such security in the over-the-counter market for such security as reported by Nasdaq, or (iii)
if no last trade price is reported for such security by Nasdaq, the average of the bid and ask prices of any market makers for such security
as reported by the OTC Markets. If the Closing Sale Price cannot be calculated for a security on a particular date on any of the foregoing
bases, the Closing Sale Price of such security on such date shall be the fair market value as mutually determined by the Company and
the Holder. All such determinations to be appropriately adjusted for any stock dividend, stock split, stock combination or other similar
transaction during the applicable calculation period.
(c) “Common
Shares” means the common shares of the Company, no par value, and any other class of securities into which such securities
may hereafter be reclassified or changed.
(d) “Common
Share Equivalents” means any securities of the Company that would entitle the holder thereof to acquire at any time Common
Shares, including without limitation any debt, preferred stock, rights, options, warrants or other instrument that is at any time convertible
into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive, Common Shares.
(e)
“Person” and “Persons” means an individual, a limited liability company, a partnership, a joint
venture, a corporation, a trust, an unincorporated organization, any other entity and any governmental entity or any department or agency
thereof.
(g) “Principal
Market” means the primary national securities exchange on which the Common Shares are then traded.
(h) “Market
Price” means the volume weighted average price of the Common Shares one Trading Day prior to the date of the respective Exercise
Notice.
(i) “Trading
Day” means (i) any day on which the Common Shares are listed or quoted and traded on its Principal Market, (ii) if the Common
Shares are not then listed or quoted and traded on any national securities exchange, then a day on which trading occurs on any over-the-counter
markets, or (iii) if trading does not occur on the over-the-counter markets, any Business Day.
*
* * * * * *
IN
WITNESS WHEREOF, the Company has caused this Warrant to be duly executed as of the Issuance Date set forth above.
| BRUUSH
ORAL CARE, INC. |
|
| |
|
|
| By: |
|
|
| Name: |
Aneil
Singh Manhas |
|
| Title: |
Chief
Executive Officer |
|
EXHIBIT
A
EXERCISE
NOTICE
(To
be executed by the registered holder to exercise this Common Share Purchase Warrant)
| 1. | The
Undersigned holder
hereby exercises the right to have issued _________________ of the Common Shares (“Warrant
Shares”) of BRUUSH ORAL CARE, INC., a corporation incorporated in British Columbia,
Canada, the “Company”), evidenced by the attached copy of the Common Share Purchase
Warrant A (the “Warrant”). Capitalized terms used herein and not otherwise defined
shall have the respective meanings set forth in the Warrant. |
| 2. | Delivery
of Warrant Shares. The Company shall deliver to the holder __________________ Warrant
Shares in accordance with the terms of the Warrant. |
| |
|
| |
(Print
Name of Registered Holder) |
| |
|
|
| |
By:
|
|
| |
Name:
|
|
| |
Title:
|
|
EXHIBIT
B
ASSIGNMENT
OF WARRANT
(To
be signed only upon authorized transfer of the Warrant)
For
Value Received, the undersigned hereby sells, assigns,
and transfers unto ____________________ the right to purchase _______________ Common Shares of BRUUSH ORAL CARE, INC., to which
the Common Share Purchase Warrant relates and appoints ____________________, as attorney-in-fact, to transfer said right on the books
of BRUUSH ORAL CARE, INC. with full power of substitution and re-substitution in the premises. By accepting such transfer, the
transferee has agreed to be bound in all respects by the terms and conditions of the within Warrant.
| |
|
| |
(Signature)
* |
| |
|
| |
|
| |
(Name) |
| |
|
| |
|
| |
(Address) |
| |
|
| |
|
| |
(Social
Security or Tax Identification No.) |
*
The signature on this Assignment of Warrant must correspond to the name as written upon the face of the Common Share Purchase Warrant
in every particular without alteration or enlargement or any change whatsoever. When signing on behalf of a corporation, partnership,
trust or other entity, please indicate your position(s) and title(s) with such entity.
Exhibit
10.5
Exhibit
E – CONFESSION OF JUDGMENT
| STATE OF MINNESOTA, |
X |
|
| INVESTOR |
Index No |
| |
|
Plaintiff, |
| |
|
|
| |
|
AFFIDAVIT OF
CONFESSION OF
JUDGMENT |
| |
|
|
| - against - |
|
|
| |
|
|
| BRUUSH ORAL CARE, INC., |
|
|
| Defendant. |
| |
X |
| |
AFFIDAVIT
OF CONFESSION OF JUDGEMENT
Aneil
Singh Manhas, being duly sworn, hereby deposes and says
| 1. | I
am the Chief Executive Officer of defendant BRUUSH ORAL CARE, INC. (“Company”).
As such, I am fully familiar with all the facts and circumstances recited herein on personal
knowledge. Company has its principal place of business at 128 West Hastings Street, Unit
210 Vancouver, British Columbia V6B 1G8. On behalf of the Company, I hereby confess judgment
in favor of _______ (“Investor”), a corporation with an office at The
Block E Building, 8th Street and Main Avenue
Moorhead, Minnesota, 56560, in amount equal to the fair market value on the date of
this affidavit of confession of judgment of those common shares of the Company for which
the Investor has submitted an exercise notice under either that certain Prefunded Common
Share Purchase Warrant A and Common Share Purchase Warrant B (the “Warrants”)
dated as of October 2, 2023, and in respect of which the Company has not issued common shares
as required pursuant to the terms of the Warrants and any other common shares required to
be issued by the Company to the Investor that have not been issued to Investor (the “Unissued
Warrant Share Value”). |
| 2. | I
hereby authorize the federal courts and/or state courts located in the State of Minnesota
to enter judgment against Company in an amount equal to the Unissued Warrant Share Value
on or after the date of this affidavit of confession of judgment, and all other applicable
penalties under the Securities Purchase Agreement, dated as of October 2, 2023 (the “Securities
Purchase Agreement”), plus the cost of attorney’s fees that are set forth below,
less the fair market value of any issuances of common shares made to the Investor on or after
the date of this affidavit of confession of judgment, upon Company’s failure for any
reason to issue its common shares to _______ Required by the Warrants.. |
| | | |
| 3. | In
order to secure these obligations, Company agreed to simultaneously deliver the execution
of the Agreements with this Affidavit of Confession of Judgment. |
The
sums confessed pursuant to this affidavit of confession are justly due and owing to _______ under the following circumstances:
Company entered into the Securities Purchase Agreement between Company and Investor, dated as of October 2, 2023, pursuant to which Company
promised to issue 79,724 of its common shares, as well as an additional 8,350,000 common
shares upon exercise of the Common Share Purchase Warrant B issued by the Company and 7,181,146 common shares upon exercise of the Prefunded
Common Share Purchase Warrant A issued by the Company. The amounts confessed by this affidavit represent common shares of owed to the
Investor by the Company and arises out of Company’s breach of its obligations under the Securities Purchase Agreement and Warrants
by failing to issue those common shares to the Investor.
| 4. | Company
agrees to pay any and all costs and expenses incurred by Investor in enforcing the terms
of this affidavit of confession of judgment, including reasonable attorney’s fees and
expenses that Investor incurs or is billed in connection with enforcing the terms of the
affidavit of confession of judgment, entering any Judgment, collecting upon said Judgment,
and defending or prosecuting any appeals. |
| |
BRUUSH
ORAL CARE, INC. |
| |
|
|
| |
By: |
|
| |
Name: |
Aneil
Singh Manhas |
| |
Title: |
Chief
Executive Officer |
Signature
Page to Affidavit of
Confession
of Judgment
To
be confirmed via notary public or docusign
Exhibit
99.1
Brüush
Announces Pricing of $5.0 Million Private Placement
VANCOUVER,
BC / ACCESSWIRE / October 2, 2023 / Bruush Oral Care Inc. (NASDAQ: BRSH) (the “Company”), today
announced that it has entered into a securities purchase agreement with an institutional investor to raise gross proceeds of approximately
$5.0 million through a private placement, before deducting fees to the placement agent and other offering expenses payable by the Company.
In
connection with the private placement, the Company will issue 79,724 of its common shares, a prefunded common share purchase warrant
(the “Prefunded Warrant”) to purchase 7,181,146 common shares, and a common share purchase warrant (the “Common Warrant”)
to purchase 8,350,000 common shares. Each of the Common Warrant and the Pre-funded Warrant have a term of five (5) years from the date
of issuance.
The
closing of the private placement is expected to occur on or about October 3, 2023, subject to the satisfaction of certain customary closing
conditions.
EF
Hutton, division of Benchmark Investments, LLC, is acting as the exclusive placement agent for the private placement.
The
securities described above are being sold in a private placement under Section 4(a)(2) of the Securities Act of 1933, as amended (the
“Act”), and Regulation D promulgated thereunder and have not been registered under the Act, or applicable state securities
laws. Accordingly, the securities may not be offered or sold in the United States except pursuant to an effective registration statement
or an applicable exemption from the registration requirements of the Act and such applicable state securities laws. Pursuant to a registration
rights agreement with the investors, the Company has agreed to file one or more registration statements with the Securities and Exchange
Commission (the “SEC”) covering the resale of the common shares and the common shares issuable upon exercise of the warrants.
This
press release shall not constitute an offer to sell or the solicitation of an offer to buy any of the securities described herein, nor
shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation, or sale would be unlawful
prior to registration or qualification under the securities laws of any such state or jurisdiction.
About
Bruush Oral Care Inc.
Bruush
Oral Care Inc. is on a mission to inspire confidence through brighter smiles and better oral health. Founded in 2018, Brüush is
an oral care company that is disrupting the space by reducing the barriers between consumers and access to premium oral care products.
The Company is an e-commerce business with a product portfolio that currently consists of a sonic-powered electric toothbrush kit and
brush head refills. Brüush has developed a product to make upgrading to an electric brush appealing with three core priorities in
mind: (i) a high-quality electric toothbrush at a more affordable price than a comparable electric toothbrush from the competition; (ii)
a sleek, countertop-friendly design; and (iii) a convenient brush head refill subscription program that eliminates the frustrating experience
of purchasing replacement brush heads at the grocery/drug store. The Company is rooted in building a brand that creates relevant experiences
and content, with the goal of becoming the go-to oral care brand for millennials and Generation Z.
For
more information on Brüush visit: https://bruush.com
Follow
Brüush on LinkedIn: Bruush
Follow
Brüush on Instagram: @bruush
Safe
Harbor Forward-Looking Statements
This
press release of Bruush Oral Care Inc. contains “forward-looking statements”. Words such as “may”, “will”,
“could”, “should”, “expects”, “anticipates”, “intends”, “plans”,
“believes”, “seeks”, “estimates” and other comparable terminology are intended to identify forward-looking
statements. For example, the Company is using forward-looking statements when it discusses its vision, its strategy, and its products.
Forward-looking statements are not historical facts, and are based upon management’s current expectations, beliefs and projections,
many of which, by their nature are inherently uncertain. Such expectations, beliefs and projections are expressed in good faith. However,
there could be no assurance that management’s expectations, beliefs and projections will be achieved, and actual results may differ
materially from what is expressed or indicated by the forward-looking statements. Forward-looking statements are subject to risks and
uncertainties that could cause actual performance or results to differ materially from those expressed in the forward-looking statements.
Forward-looking statements speak only as of the date the statements are made. The Company assumes no obligation to update forward-looking
statements to reflect actual results, subsequent events or circumstances, changes in assumptions or changes in other factors affecting
forward-looking statements except to the extent required by applicable securities laws. If the Company does update one or more forward-looking
statement, no inference should be drawn that the Company will make additional updates with respect thereto or with respect to other forward-looking
statements.
Investor
Relations Contact:
Colette
Eymontt
colette@tradigitalir.com
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