CENBF CEN Biotech Inc (CE)

 

As previously disclosed, on April 20, 2021, CEN Biotech Inc. (the “Company”) entered into a Share Exchange Agreement (the “Agreement”) with Clear Com Media Inc., an Ontario, Canada corporation (“CCM”), each of the shareholders of CCM as set forth on the signature pages of the Agreement (the “CCM Shareholders”) and Lawrence Lehoux as the representative of the CCM Shareholders (each of CCM and the CCM Shareholders may be referred to collectively herein as the “CCM Parties”). The Agreement closed on July 9, 2021 and the Company acquired from the CCM Shareholders, all of the common shares of CCM, which is 10,000 shares of CCM common shares (the “CCM Stock”) held by the CCM Shareholders, in exchange (the “Exchange”) for the issuance by the Company to the CCM Shareholders of 4,000,000 restricted shares of the Company’s common stock, no par value per share (the “Company Common Stock”). As a result, CCM became a wholly owned subsidiary of the Company. In addition, the Company increased the number of members on its Board of Directors (the “Board”) by one and appointed and named Mr. Lehoux as a member of the Board of the Company. Mr. Lehoux was also appointed as the Company’s Chief Technology Officer. Mr. Lehoux’s employment is governed by an Executive Employment Agreement, effective September 1, 2022 (the “Employment Agreement”) which was previously filed by the Company as Exhibit 10.1 to the Current Report on Form 8-K with the U.S. Securities and Exchange Commission (the “SEC”) on August 31, 2022.

 

On March 23, 2023, the Company and the CCM parties agreed to unwind the transactions set forth in the Agreement and entered into a Termination and Release Agreement (the “Termination Agreement”). Pursuant to the Termination Agreement, the Company will transfer the CCM Stock back to the CCM Shareholders. The CCM Shareholders will keep the Company Common Stock in satisfaction of the Company’s indebtedness owing to CCM in the aggregate amount of Cdn$416,915.95. CCM will also make a payment to the Company in the aggregate amount of US$250,000 plus the Company’s legal costs associated with this transaction. The closing of these transactions shall take place on or about April 22, 2023 or on such other date as the parties may agree. Upon the closing of the Termination Agreement, Mr. Lehoux will resign from his position as director and Chief Technology Officer of the Company, which will result in the termination of the Employment Agreement.

 

Pursuant to the Termination Agreement, the Agreement will be of no further force and effect, and the parties each release all other parties to the Agreement from any and all claims, demands, etc. arising from the Agreement or the Termination Agreement.

 

The foregoing descriptions of the Agreement and the Termination Agreement do not purport to be complete and are qualified in their entirety by the terms and conditions of the full text of the Agreement, which was previously filed as Exhibit 10.1 to the Current Report on Form 8-K with the U.S. Securities and Exchange Commission (the “SEC”) by the Company on April 20, 2021, and the full text of the Termination Agreement, which is attached hereto as Exhibit 10.1, each of which is incorporated by reference herein.