RAADR, Inc.
Consolidated Statements of Cash Flows
(Unaudited)
| For The Year Ended
|
| December 31,
|
| 2023
|
| 2022
|
|
|
|
|
CASH FLOWS FROM OPERATING ACTIVITIES:
| $
| (50,813)
|
| $
| (4,050,139)
|
Net loss
|
|
|
|
|
|
Adjustments to reconcile net loss to net cash used in operating activities:
|
|
|
|
|
|
Depreciation
|
| 1,828
|
|
|
|
Change in fair value of derivative liability
|
| (3,828,593)
|
|
| 2,378,733
|
Stock based compensation
|
| 301,524
|
|
| 282,600
|
Loss on forbearance agreement
|
| 2,720,000
|
|
|
|
Loss on anti-dilution clause
|
| 270,541
|
|
|
|
Amortization of debt discount
|
|
|
|
| 229,523
|
Additional interest expense on conversion of notes payable
|
|
|
|
| 39,631
|
Effect of changes in:
|
|
|
|
|
|
Accounts payable
|
| 16,518
|
|
| 32,278
|
Accrued expenses
|
| 331,016
|
|
| 381,859
|
Net Cash Used in Operating Activities
|
| (237,979)
|
|
| (705,515)
|
|
|
|
|
|
|
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
|
Purchase of property and equipment
|
| -
|
|
| (1,828)
|
Net Cash Used in Financing Activities
|
| -
|
|
| (1,828)
|
|
|
|
|
|
|
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
|
Proceeds from issuance of convertible notes payable
|
| 126,150
|
|
| 150,900
|
Repayments of advances
|
| -
|
|
| (8,000)
|
Proceeds from line of credit
|
| -
|
|
| 42,590
|
Payments on line of credit
|
| (2,936)
|
|
| (1,532)
|
Offering costs paid for notes payable
|
| -
|
|
| (8,000)
|
Payments of notes payable
|
| -
|
|
| (37,558)
|
Proceeds from notes payable
|
| 33,508
|
|
| 249,145
|
Proceeds from sale of common stock
|
| 93,750
|
|
| 318,500
|
Net Cash Provided by Financing Activities
|
| 250,472
|
|
| 706,045
|
|
|
|
|
|
|
Net Increase (Decrease) in Cash
|
| 12,493
|
|
| (1,298)
|
Cash at Beginning of Year
|
| 871
|
|
| 2,169
|
Cash at End of Period
| $
| 13,364
|
| $
| 871
|
|
|
|
|
|
|
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
|
|
|
|
|
|
Cash paid during the year for:
|
|
|
|
|
|
Interest
|
| -
|
| $
| 6,045
|
Income taxes paid
|
| -
|
|
| -
|
|
|
|
|
|
|
Non-cash investing and financing activities
|
|
|
|
|
|
Conversions of notes payable
| $
| 50,454
|
|
|
|
The accompanying notes are an integral part of these consolidated financial statements.
F-20
RAADR, Inc.
Notes to Consolidated Financial Statements
For the Years Ended December 31, 2023 and 2022
(Unaudited)
Note 1 - History and Organization
Organization
Raadr, Inc. (the “Company”) was organized March 29, 2006 (Date of Inception) under the laws of the State of Nevada, as White Dental Supply, Inc. On December 27, 2012, the Company formed two wholly owned subsidiaries, Choice One Mobile, Inc. and PITOOEY! Mobile, Inc., under the laws of the State of Nevada. On January 7, 2013, the Board of Directors of the Company authorized and a majority of the stockholders of the Company ratified, by written consent, resolutions to change the name of the Company to PITOOEY!, Inc. The name change was effective with the State of Nevada February 7, 2013. On February 6, 2013, the Company formed a wholly owned subsidiary, Rockstar Digital, Inc., under the laws of the State of Nevada. On October 31, 2013, the Company, as part of its settlement agreement with the employees of Rockstar Digital, ceased operations of its wholly owned subsidiary, Rockstar Digital, Inc. On July 29, 2015, the Company changed their name to Raadr, Inc. The name change was effective with the State of Nevada on July 29, 2015.
Business
The Company offers a unique software tool in www.raadr.com that allows individuals to monitor social media activity online. As the digital world of the 21st Century continues to evolve, parents, guardians, and children are faced with challenges and threats not just in the real world, but in the omnipresent realm of Social Media as well. PITOOEY! INC., makers of the proprietary technology application RAADR© have developed a web based tool that provides families with peace of mind when it comes to knowing that children are safe from bullying and predatory behavior unfortunately so prevalent today.
By customizing their own unique monitoring and alert settings, parents and guardians can be alerted when their children’s Facebook, Twitter, Instagram and other pertinent social media platforms under scrutiny become posted with inappropriate language. By utilizing customized keywords chosen by the user that are added to an already existing database, parents and guardians can carry a sense of assuredness that the youth they love and are responsible for are safe and acting in a fun, yet appropriate manner.
Going Concern
The accompanying consolidated financial statements have been prepared assuming the Company will continue as a going concern. As shown in the accompanying consolidated financial statements, the Company has limited assets and a working capital deficit of approximately $10.3 million.
In order to continue as a going concern, the Company will need, among other things, additional capital resources. The Company is significantly dependent upon its ability, and will continue to attempt, to secure equity and/or additional debt financing. The Company is attempting to conduct private placements of its preferred and common stock to raise proceeds to finance its plan of operation. There are no assurances that the Company will be successful, and without sufficient financing, it would be unlikely for the Company to continue as a going concern.
The consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts of and classification of liabilities that might be necessary in the event the Company cannot continue in existence. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. These consolidated financial statements do not include any adjustments that might arise from this uncertainty.
Unaudited and Unreviewed Financial Statements
The accompanying consolidated financial statements have been prepared by the Company’s management pursuant to the rules and regulations of the United States Securities and Exchange Commission. These consolidated financial statements have not been audited or reviewed by an independent third party.
F-21
Note 2 - Summary of Significant Accounting Policies
Basis of Presentation
The Company’s unaudited consolidated financial statements have been prepared in accordance with accounting principles
generally accepted in the United States (“U.S. GAAP”).
Principles of Consolidation
The consolidated financial statements include the accounts of Raadr, Inc., Choice One Mobile, Inc., PITOOEY! Mobile, Inc. and Rockstar Digital, Inc. All significant intercompany balances and transactions have been eliminated. Raadr, Inc., Choice One Mobile, Inc., PITOOEY! Mobile, Inc. and Rockstar Digital, Inc. will be collectively referred herein to as the “Company”.
Risks and Uncertainties
The Company has a limited operating history and has not generated revenues from our planned principal operations.
The Company’s business and operations are sensitive to general business and economic conditions in the U.S. and worldwide. These conditions include short-term and long-term interest rates, inflation, fluctuations in debt and equity capital markets and
the general condition of the U.S. and world economy. A host of factors beyond the Company’s control could cause fluctuations
in these conditions, including the political environment and acts or threats of war or terrorism. Adverse developments in these
general business and economic conditions, including through recession, downturn or otherwise, could have a material adverse
effect on the Company’s consolidated financial condition and the results of its operations.
The Company currently has limited sales and marketing and/or distribution capabilities. The Company has limited experience
in developing, training or managing a sales force and will incur substantial additional expenses if we decide to market any of
our current and future products. Developing a marketing and sales force is also time consuming and could delay launch of our
future products. In addition, the Company will compete with many companies that currently have extensive and well-funded
marketing and sales operations. Our marketing and sales efforts may be unable to compete successfully against these
companies . In addition, the Company has limited capital to devote sales and marketing.
The Company’s industry is characterized by rapid changes in technology and customer demands. As a result, the Company’s products may quickly become obsolete and unmarketable. The Company’s future success will depend on its ability to adapt to
technological advances, anticipate customer demands, develop new products and enhance our current products on a timely and
cost -effective basis. Further, the Company’s products must remain competitive with those of other companies with substantially
greater resources. The Company may experience technical or other difficulties that could delay or prevent the development,
introduction or marketing of new products or enhanced versions of existing products. Also, the Company may not be able to
adapt new or enhanced products to emerging industry standards, and the Company’s new products may not be favorably
received . We also may not have the capital resources to further the development of existing and/or new ones.
Use of Estimates
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ significantly from those estimates.
Loss Per Common Share
Net loss per share is provided in accordance with ASC Subtopic 260-10. The Company presents basic loss per share (“EPS”) and diluted EPS on the face of the statements of operations. Basic EPS is computed by dividing reported losses by the weighted average shares outstanding. Except where the result would be anti-dilutive to income from continuing operations, diluted earnings per share has been computed assuming the conversion of the convertible long-term debt and the elimination of the related interest expense, and the exercise of stock warrants. Loss per common share has been computed using the weighted average number of common shares outstanding during the year.
F-22
Fair Value of Financial Instruments
Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants as of the measurement date. Applicable accounting guidance provides an established hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in valuing the asset or liability and are developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the factors that market participants would use in valuing the asset or liability.
The three levels of the fair value hierarchy are described below:
Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;
Level 2: Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability;
Level 3: Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported by little or no market activity).
As of December 31, 2023 and 2022, respectively, the derivative liabilities are considered a level 2 item; see Note 4.
The carrying amounts reflected in the balance sheets for cash, accounts payable and accrued expenses approximate the respective fair values due to the short maturities of these items.
Recent Pronouncements
Management does not believe that any other recently issued, but not yet effective, authoritative guidance, if currently adopted, would have a material impact on the Company’s consolidated financial statement presentation or disclosures.
Note 3 - Financial Statement Elements
Accrued liabilities as of December 31, 2023 and December 31, 2022 consisted of:
|
| December 31,
2023
|
| December 31,
2022
|
|
|
|
|
|
Accrued payroll and taxes
|
| $
| 188,030
|
| $
| 188,117
|
Executive compensation
|
|
| 617,921
|
|
| 636,270
|
Accrued interest
|
|
| 1,761,963
|
|
| 1,412,511
|
Other
|
|
| 596,638
|
|
| 596,638
|
|
| $
| 3,164,552
|
| $
| 2,833,536
|
In August 2015, the Company entered into a settlement agreement with their former Chief Executive Officer. In connection with the agreement, the Company has the obligation to issue 1 share of common stock in settlement of amounts payable to the former Chief Executive Officer for accrued salaries and an investment in Series B preferred stock. The Company has yet to issue the required shares, and thus, as of December 31, 2023 and 2022, respectively, the liabilities remain.
See Note 7 for discussion of accrued wages due to the Company’s Chief Executive Officer.
F-23
Note 4 - Notes Payable
Notes payable as of December 31, 2023 and 2022, respectively, consisted of:
|
| December 31,
2023
|
| December 31,
2022
|
|
|
|
|
|
Third Party Notes:
|
|
|
|
|
Convertible promissory notes
|
| $
| 1,701,018
|
| $
| 1,611,386
|
Debentures with warrants
|
|
| 327,664
|
|
| 327,664
|
Notes under Investment Agreement
|
|
| 69,333
|
|
| 69,333
|
Promissory notes
|
|
| 507,635
|
|
| 480,599
|
Subtotal - third party notes
|
|
| 2,605,650
|
|
| 2,488,982
|
|
|
|
|
|
|
|
Related Party Notes:
|
|
|
|
|
|
|
Debentures with warrants
|
|
| 87,445
|
|
| 87,445
|
Demand notes
|
|
| 30,659
|
|
| 30,659
|
Subtotal - related party notes
|
|
| 118,104
|
|
| 118,104
|
Total
|
|
| 2,723,754
|
|
| 2,607,086
|
Current portion
|
|
| (2,576,985)
|
|
| (2,459,586)
|
Long-term portion
|
| $
| 146,769
|
| $
| 147,500
|
As of the date of this filing, all notes outstanding as of December 31, 2023, with exception of $146,769 are in default.
Convertible Promissory Notes
Commencing in December 2014 and through September 2018, the Company issued various convertible promissory notes to third parties to be used for operations. In most cases, these convertible promissory notes are convertible upon issuance into a variable number of shares of common stock. Based on the requirements of ASC 815, we determined that a derivative liability was triggered upon issuance due to the variable conversion price. Using the Black-Scholes pricing model, we calculated the derivative liability upon issuance and recorded the fair market value of the derivative liability as a discount to the convertible promissory notes. When a derivative liability associated with a convertible note is in excess of the face value of the convertible note, the excess of fair value of derivative is charged to the statement of operations. The derivative liability is required to be revalued at each conversion event and at each reporting period. The Company doesn’t account for the derivative liability until the convertible promissory note is convertible. In addition, these convertible promissory notes include various default provisions in which increase the interest rate to rates ranging from 12% to 35% and at times the principal balance at rates ranging from 5% to 50%. Additionally, most convertible promissory notes have prepayment penalties in which range from 15% to 50%.
In May, June, September, October, November and December 2020, a total of $90,000 in convertible notes were received. The notes bear an interest rate of 10% and mature on April 1, 2021. The notes are convertible into common stock based upon a 50% discount to the lowest traded price within the 20 trading days preceding the conversion. The note contains various prepayment and default provisions, similar to those disclosed above.
On July 23, 2020, the Company entered into a convertible note payable with a third party for proceeds of $25,000. The convertible note incurs interest at 20% per annum, is due 180 days from the date of issuance and is convertible upon issuance into shares of the Company’s common stock at a 50% discount to the average closing bid price during the preceding 10 trading days. The note contains various prepayment and default provisions, similar to those disclosed above.
On August 13, 2020, the Company entered into a convertible note payable with a third party for proceeds of $60,000. The convertible note incurs interest at 25% per annum, is due 180 days from the date of issuance and is convertible upon issuance into shares of the Company’s common stock at a 50% discount to the average closing bid price during the preceding 10 trading days. The note contains various prepayment and default provisions, similar to those disclosed above.
In September 2020, a $40,000 convertible note was sold from one third party to another. Under the terms of the new note agreement, principal of $98,367 is due on year from the date of issuance. The notes bear an interest rate of 10% and mature on April 1, 2021. The notes are convertible into common stock based upon a 50% discount to the lowest traded price within the 20 trading days preceding the
F-24
conversion. The note contains various prepayment and default provisions, similar to those disclosed above. The difference between the carry value of the new note and the old not plus accrued interest was $38,405 and recorded as interest expense.
In November 2020, a $50,000 convertible note with accrued interest of $23,877 was sold from one third party to another. Under the terms of the new note agreement, principal of $73,877 is due on year from the date of issuance. The notes bear an interest rate of 10% and mature on April 1, 2021. The notes are convertible into common stock based upon a 50% discount to the lowest traded price within the 20 trading days preceding the conversion. The note contains various prepayment and default provisions, similar to those disclosed above.
At various times during the year ended December 31, 2021, the Company entered into convertible notes payable totaling $437,536 receiving proceeds of $355,000. The terms of the notes range from six months to one year, interest ranging from 8-20% and conversion prices with discounts of up to 50% of the lowest bid prices in days prior ranging from five to 25 days. In addition, the Company issued $500,000 in convertible notes payable for services for which the terms are similar to those noted above.
In March 2021, a note with $472,431 in principal and $299,456 in accrued interest was sold to a third party for which the Company entered into a new convertible note of $771,887. Under the terms of the new note agreement, principal of $73,877 is due one year from the date of issuance. The notes bear an interest rate of 10% and mature in one year. The note is convertible into common stock based upon a 50% discount to the lowest traded price within the 20 trading days preceding the conversion. The note contains various prepayment and default provisions, similar to those disclosed above.
During the year ended December 31, 2021, the Company issued 27,952,829 shares of common stock in satisfaction of $1,520,840 in principal and interest. In connection with the conversion, derivative liabilities of $2,637,806 were relieved.
At various times during the year ended December 31, 2022, the Company entered into convertible notes payable totaling $150,900 receiving proceeds of $126,650. The terms of the notes range from six months to one year, interest ranging from 4-8% and conversion prices ranging from $0.00025 - $0.0005.
During the year ended December 31, 2022, the Company issued 5,550,000 shares of common stock in satisfaction of $27,750 in principal and interest. In connection with the conversion, derivative liabilities of $83,250 were relieved and a loss of $34,500 was recorded.
At various times during the year ended December 31, 2023, the Company entered into convertible notes payable totaling $126,150 receiving proceeds of $126,150. The terms of the notes range from six months to one year, interest ranging from 8% - $20% and conversion prices ranging from $0.00025 - $0.000358, which are at a 65% discount to the previous 10 closing prices.
During the year ended December, 2023, the Company issued 137,174,000 shares of common stock in satisfaction of $50,454 in principal and interest.
2018 Issuances
During the year ended December 31, 2018, the Company received $45,775 in proceeds from the issuance of six convertible notes payable. Under the terms of the agreements, the notes are due in 180 days from the date of issuance, incur interest at rates ranging from 10%- 25% per annum and are convertible into common stock at a 50% discount to the average closing bid price per share of common stock during the 10 consecutive trading days immediately prior to conversion. In addition, the notes include a 50% prepayment penalty. Due to the variable conversion price, the Company recorded a derivative liability in connection with these notes.
Discounts and Conversions
The convertible notes issued were fully discounted at issuance due to the associated derivative liabilities being in excess of the convertible notes payable. The discounts are being amortized over the terms of the notes. As of December 31 2023 and 2022, respectively, discounts of $0 remained. Amortization expense for the year ended December 31, 2023 and 2022, respectively, was $0 and $229,523. At December 31, 2023, the derivative liabilities were re-valued at $2,616,951 which resulted in a gain on change in the fair market value of derivative liabilities of $3,238,593. See below for weighted average variables used.
As of December 31, 2023, these convertible notes were convertible into approximately 32.0 billion shares of common stock, which is in excess of the total authorized shares.
F-25
Derivative Liabilities
During the years ended December 31, 2023 and 2022, respectively, the range of inputs used to calculate the derivative liability were as follows:
|
| December 31, 2023
|
| December 31, 2022
|
|
|
|
|
|
Exercise price per share
|
| $0.00036
|
| $0.00005
|
Expected life (years)
|
| 1.00
|
| 0.50
|
Risk-free interest rate
|
| 4.15%
|
| 3.92%
|
Expected volatility
|
| 1701%
|
| 1712%
|
Debentures with Warrants
At various dates in 2014 and 2013, the Company issued debentures with warrants totaling $347,664. These debentures contain interest rates ranging from 8% to 20% and matured at various times from July 2014 through July 2015. As of December 31, 2023 and 2022, respectively, these notes were in technical default. The warrants issued with these debentures contain an exercise price of $2,500 per share and expired three years from the date of issuance.
Notes Issued Under an Investment Agreement
On April 29, 2013, the Company entered into an Investment Agreement, in which an investor agreed to purchase debentures up to a total principal amount of $1,100,000. This commitment was increased to $2,000,000 based on an agreement modification entered into on December 2, 2013. Each debenture will accrue interest on the unpaid principal of each individual debenture at the rate of 8% per year from the date each debenture is issued until paid. Maturity dates of the debentures issued range from April 2014 through May 2015. In March 2021, the holder transferred $472,431 in principal and $299,456 in accrued interest to a third party for which the Company entered into a new convertible note, see above. As of December 31, 2023 and 2022, respectively, the principal balance owed on these debentures was $69,333, plus accrued interest.
Promissory Notes
On July 25, 2012, the Company entered into an Intellectual Property Assignment Agreement. In accordance with the terms and conditions contained therein, the Company has agreed to pay the Seller $8,000 in two installments: The first payment of $4,000 was due July 25, 2013, and second payment of $4,000 was due July 25, 2014. The note is currently in default due to non-payment.
During the year ended December 31, 2013, the Company issued a $50,000 promissory note bearing interest at 10% and due on May 31, 2014. The note is payable in monthly payments of principal and interest. As of December 31, 2023 and 2022, respectively, the remaining principal balance of $10,606, is past due and in default.
In June 2015, the Company received $20,000 in proceeds from convertible notes payable. The notes are convertible, only at the Company’s option, for a minimum of $40,000 in common stock based upon the closing stock price on the date of conversion for a period of one year. In addition, the notes incur interest at 12% per annum and is due June 1, 2016. Since the note is only convertible at the Company’s option, the accounting for such will be triggered if the option is exercised.
On July 13, 2020, the Company entered into a $150,000 loan with the Small Business Administration. The note incurs interest at 3.75% per annum with principal and interest due over the period of thirty years. The note is secured by substantially all of the Company’s asset and requires the funds to be used for operational purposes. As of December 31, 2023 and 2022, respectively, the remaining principal balance was $147,500.
During the year ended December 31, 2022, the Company issued $209,145 in short-term promissory notes to various parties with interest rates ranging from 20%-50%. The Company also issued approximately $40,000 in short-term promissory notes to various third parties for expenses paid by the third parties on behalf of the Company. These mature on demand or on various dates from April 2022 through September 2022. During the year ended December 31, 2022, the Company repaid approximately $37,558 of these promissory notes.
During the year ended December 31, 2022, the Company also entered into two 18-month business loan agreements totaling $160,000. The loans require fixed weekly payments of principal and interest totaling $2,897 through November 2023 and have effective interest rates ranging from 34% to 63%. These loans are also secured by substantially all assets of the Company and have various default
F-26
provisions as defined within the agreement, whereby the debt can be called immediately. As certain of these default provisions have been triggered, the full amount of the remaining principal balance of the loans of $145,942 as of December 31, 2022 has been presented as current although default has not been called by the lender. Net proceeds of $158,175 were received from these loans. An additional $8,000 was paid to a third party for brokering the deal. The on-issuance discount and additional fees paid were recorded as a discount to the loans and are being amortized over the life of the loan. During the year ended December 31, 2022, all of the discount was amortized to interest.
Debentures with Warrants Issued to Related Parties
At various times in 2014 and 2013, the Company issued debentures with warrants to several related parties for $87,445. These debentures bear interest at 8% and mature at various times from July 2014 through February 2015. As of December 31, 2022 and 2021, all the notes are in default as they are past the maturity dates. The warrants issued with these debentures contain an exercise price of $2,500 per share and expired three years from the date of issuance.
Demand Notes Issued to Related Parties
The Company has various notes outstanding to related parties totaling $30,659 and $30,659 as of December 31, 2023 and 2022, respectively. These notes are due on demand and have no stated interest rate. The Company records imputed interest in connection with these related party notes.
Advances
As of December 31, 2023 and December 31, 2022, the Company received advances from a third parties totaling $105,700 and $105,700, respectively. These advances bear interest at 20% per annum and are due 90 days after the funds are received. As of the date of this filing, these advances are considered in default as they are past their maturity date.
Line of Credit
During the year ended December 31, 2022, the Company took out a business line of credit with a financial institution that provides a credit line of up to $35,000. Advances under this line incur interest as an annual rate of 12.25% plus various other periodic finance charges. As of December 31, 2023 and 2022, $38,998 and $41,934 was outstanding on the line of credit, respectively.
Note 5 - Commitments and Contingencies
Consulting Agreements
On December 30, 2015, effective January 1, 2016, the Company entered into an agreement with two consultants to promote the Company’s RAADR mobile app for a period of 60 days. Under the terms of the agreement, the consultants received a total of 20 shares of common stock and were to be paid a total of $50,000 for their services. In addition, the consultants were to receive 50% of all revenues generated from the RAADR mobile app. As of December 31, 2023 and 2022, respectively, no amounts had been earned under the revenue arrangement.
On June 27, 2018, the Company entered into an agreement with an individual whereby the individual is to provide consulting services in exchange for 40 shares of common stock. The shares were valued at $2,000 based upon the closing price of the Company’s common stock on the date of the agreement. The agreement does not provide for a performance commitment, and thus, the common stock was expensed upon issuance.
During the year ended December 31, 2018, the Company entered into an agreement with an individual whereby the individual is to provide consulting services in exchange for 100 shares of common stock. The shares were valued at $5,000 based upon the closing price of the Company’s common stock on the date of the agreement. The agreement does not provide for a performance commitment, and thus, the common stock was expensed upon issuance. Additionally, the agreement notes a signing bonus of $10,000 as well as bonuses for certain milestones, none of which have been paid.
See Note 6 for an additional agreements.
F-27
Legal
On February 6, 2013, we formed a wholly owned subsidiary, Rockstar Digital, Inc. (“Rockstar”), under the laws of the State of Nevada. Rockstar was organized to specialize in internet branding through social media marketing, mobile marketing and iPhone ® app development Company. On October 31, 2013, the Company entered into a settlement agreement with certain former employees to assume responsibility for certain payroll taxes of Rockstar Digital, Inc. (“Rockstar”) and assign its ownership of Mobile Application and Transition Services intellectual property rights to Rockstar. In addition, the Company agreed to not assert a claim against certain computer equipment (cost of $28,307) in use at Rockstar. The Company agreed to assume liability for any payroll taxes owed on payroll paid by the Company on behalf of Rockstar’s employees. The Company estimated this liability at $30,000 which they have recorded in accrued liabilities as of December 31, 2023 and 2022, respectively
On July 29, 2014, a default judgment was issued against the Company in Circuit Court of the 11th Judicial Circuit in and for Miami-Dade County, Florida. This judgment stems from a legal filing by a consulting firm, with which the Company entered into an agreement for consulting services, on February 20, 2013. On September 25, 2013, the Company cancelled the agreement because it determined that services had not been provided by consulting firm, as promised per the agreed-upon contract terms. In November 2014, we entered into a settlement agreement whereby the Company shall pay the plaintiff $13,246, in monthly installments of $1,472. In addition, the Company issued options to purchase 20 shares of the Company’s common stock at an exercise price of $8,750 expiring in two years. The Company valued the options on the date of issuance at $21,424 using the Black-Sholes model. The required payments on the settlement have not been made, however, the full amount of the liability has been recorded within accrued liabilities as of December 31, 2023 and 2022, respectively.
On April 5, 2017, the Circuit Courts within the Twelfth Judicial Circuit of Florida entered an order approving the stipulation of the parties (the “Stipulation”) in the matter of Northbridge Financial, Inc. (“NBF”) v. Raadr Inc. Under the Stipulation, the Company agreed to issue, as settlement of liabilities owed by the Company to NBF in the aggregate amount of $272,250 (the “Claim Amount”) and the following:
(a)In one or more tranches as necessary, 7,000 shares of common stock (the “Initial Issuance”) and $27,500 in fees.
(b)Through the Initial Issuance and any required additional issuances, that number of shares of common stock with an aggregate value equal to the Purchase Price (defined under the Stipulation as the market price (defined as the lowest closing bid price of the Company’s common stock during the valuation period set forth in the Stipulation) less the product of the Discount (equal to 50%) and the market price.
(c)If at any time during the valuation period the closing bid price of the Company’s common stock is below 90% of the closing bid price on the day before an issuance date, the Company will immediately cause to be issued to BF such additional shares as may be required to affect the purposes of the Stipulation.
(d)Notwithstanding anything to the contrary in the Stipulation, the number of shares beneficially owned by NBF will not exceed 4.99% of the Company’s outstanding common stock.
In connection with the Settlement Shares, the Company relied on the exemption from registration provided by Section 3(a)(10) under the Securities Act.
The Company cannot reasonably estimate the amount of proceeds NBF expects to receive from the sale of these shares which be used to satisfy the liabilities. Thus, the Company accounts for the transaction as the shares are sold and the liabilities are settled. All amounts are included within accounts payable. Shares in which are held by NBF at each reporting period are accounted for as issued but not outstanding. During the year ended December 31, 2017, the Company issued 6,263 shares of common stock in settlement of $219,250 in accounts payable. The Company valued the common stock issued at $847,250 based upon the closing market price of the common stock on the settlement date. The difference between the fair market value of the common stock and accounts payable relieved of $628,000 was recorded as additional interest expense. As of December 31, 2023 and 2022, respectively, amounts payable to NBF included within accounts payable were $53,000.
F-28
Note 6 - Stockholders’ Deficit
Authorized Shares
As of December 31, 2023, the Company is authorized to issue 39,000,000,000 shares of $0.001 par value common stock and 101,000,000 shares of $0.001 par value preferred stock (of which 20,000,000 have been designated as Series A Preferred Stock, 1,000,000 have been designated as Series E Preferred Stock, and 8,000,000 shares of preferred stock available for the Company to assign or designate such provisions or preferences as may be assigned by the Board of Directors).
Effective December 20, 2022, the Company enacted a 100 to 1 reverse stock split. All share and per share amount have been revised to reflect the reverse stock split.
Series A Preferred Stock
On January 3, 2013, the Company filed a Certificate of Designation with the State of Nevada to designate up to 20,000,000 shares of preferred stock as “Series A”. The Series A holds no voting rights but is automatically convertible into shares of the Company’s common stock immediately upon the effectiveness of a Certificate of Change filed by the Company to increase the number of shares of common stock the Company would become authorized to issue.
Series B Preferred Stock
As of the date of these consolidated financial statements the designations for the Series B have not been filed with the State, and thus, the proceeds received for sale of these shares to date are reflected as a liability on the accompanying balance sheets at June 30, 2023 and December 31, 2022. The rights and preferences are not valid until the designations are filed. Once approved, the holders are expected to receive warrants to purchase one share of common stock at $50.00 per share. In addition, each share of Series B converted the holder would receive two shares of common stock.
Series E Preferred Stock
On January 27, 2016, the Company filed a Certificate of Designation with the State of Nevada to designate up to 1,000,000 shares of preferred stock as “Series E”. The Series E hold voting rights equal to twice the number of votes of all outstanding shares of capital stock such that the holders of outstanding shares of Series E shall always constitute 66.67% of the voting rights of the Corporation. All shares of Series E rank subordinate to all of the Company’s common and preferred stock and are not entitled to participate in the distribution of the Company’s assets upon liquidation.
Common Stock
During the year ended December 31, 2023, the Company sold 89,500,000 shares of common stock for total proceeds of $93,750. The Company also issued 127,820,746 shares of common stock for consulting services. In connection with these issuances, the Company recorded stock-based compensation expense of $301,524 during the year ended December 31, 2023 based on the closing market price of the Company’s stock on the date of grant.
During the year ended December 31, 2023, 209,370,320 shares were issued for full-ratchet anti-dilution protection rights to shareholders resulting in a loss of $270,541.
During the year ended December 31, 2023, 137,174,000 shares were issued for conversion of notes payable that totaled $50,454 of principal and interest.
During the year ended December 31, 2023, 1,700,000,000 shares were issued in a forbearance agreement to three shareholders resulting in a loss of $2,720,000.
During the year ended December 31, 2022, the Company sold 30,412,500 shares of common stock for total proceeds of $318,500. The Company also issued 5,791,577 shares of common stock for consulting services. In connection with these issuances, the Company recorded stock-based compensation expense of $282,600 during the year ended December 31, 2022, 2022 based on the closing market price of the Company’s stock on the date of grant. 2,000,000 of these shares were issued with full-ratchet anti-dilution protection rights.
See Note 4 for additional common stock issuance.
F-29
Note 7 - Related Party Transactions
As of December 31, 2023 and December 31, 2022, amounts included within accrued liabilities related to payroll due to Jacob DiMartino, our Chief Executive Officer, were $617,921 and $636,270, respectively. The Company accrues $15,000 per month in connection with the CEO’s services.
During the year ended December 31, 2023the Company made contributions of approximately $6,000 to a youth sports not for profit for which the Company’s Chief Executive Officer has significant influence.
See Note 4 discussion related to notes payable and Note 6 for shares issued to related parties.
Note 8 - Subsequent Events
The Company has evaluated events subsequent to December 31, 2023 and through the date these financial statements have been prepared and has determined no events, other than those disclosed above, have occurred that would materially affect these consolidated financial statements.
F-30
MEXEDIA, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
(unaudited)
| June 30, 2024
|
| December 31, 2023
|
ASSETS
|
|
|
|
|
|
NON-CURRENT ASSETS
|
|
|
|
|
|
Intangible assets, net
| $
| 11,692,611
|
| $
| 12,257,161
|
TOTAL NON-CURRENT ASSETS
|
| 11,692,611
|
|
| 12,257,161
|
|
|
|
|
|
|
CURRENT ASSETS
|
|
|
|
|
|
Prepaid expenses and other current assets
|
| 232,225
|
|
| 8,668
|
Accounts receivable, net
|
| 28,300,087
|
|
| 31,360,759
|
Cash
|
| 46,041
|
|
| 24,303
|
TOTAL CURRENT ASSETS
|
| 28,578,354
|
|
| 31,393,730
|
TOTAL ASSETS
| $
| 40,270,965
|
| $
| 43,650,891
|
|
|
|
|
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
CURRENT LIABILITIES
|
|
|
|
|
|
Deferred tax liability
| $
| 528,341
|
| $
| 528,341
|
Accounts payable
|
| 31,169,028
|
|
| 36,117,779
|
Accrued provider costs
|
| 1,776,864
|
|
| ---
|
Accrued expenses
|
| 973
|
|
| 155,768
|
TOTAL CURRENT LIABILITIES
|
| 33,475,206
|
|
| 36,801,888
|
|
|
|
|
|
|
NON-CURRENT LIABILITIES
|
|
|
|
|
|
Due to related party
|
| 6,252,327
|
|
| 5,675,040
|
TOTAL LIABILITIES
|
| 39,727,533
|
|
| 42,476,928
|
|
|
|
|
|
|
COMMITMENTS AND CONTINGENCIES
|
|
|
|
|
|
EQUITY
|
| 543,432
|
|
| 1,173,963
|
TOTAL LIABILITIES AND EQUITY
| $
| 40,270,965
|
| $
| 43,650,891
|
The accompanying notes are an integral part of these unaudited consolidated financial statements.
F-31
MEXEDIA, INC. AND SUBSIDIARIES
Consolidated Statement of Profit and Loss
For the Six Months Ended June 30, 2024 and 2023
(unaudited)
| Six Months Ended June 30,
|
| 2024
|
| 2023
|
|
|
|
|
|
|
REVENUES, NET
| $
| 17,663,834
|
| $
| 100,000,366
|
COST OF SALES
|
| (16,948,183)
|
|
| (96,485,394)
|
GROSS PROFIT
|
| 715,651
|
|
| 3,514,972
|
|
|
|
|
|
|
OPERATING EXPENSES
|
|
|
|
|
|
Depreciation and amortization
|
| 564,000
|
|
| -
|
Other expenses
|
| -
|
|
| 23,428
|
General and administrative expenses
|
| 787,940
|
|
| 1,460,130
|
TOTAL OPERATING EXPENSES
|
| 1,352,490
|
|
| 1,483,558
|
|
|
|
|
|
|
OPERATING PROFIT (LOSS)
|
| (636,839)
|
|
| 2,031,414
|
|
|
|
|
|
|
FINANCE COSTS
|
| 6,308
|
|
| (855,448)
|
|
|
|
|
|
|
OTHER NON-OPERATING INCOME
|
| -
|
|
| 120,433
|
|
|
|
|
|
|
OTHER NON-OPERATING EXPENSES
|
| -
|
|
| (18,930)
|
|
|
|
|
|
|
PROFIT (LOSS) BEFORE TAX EXPENSE
|
| (630,531)
|
|
| 1,277,469
|
|
|
|
|
|
|
TAX EXPENSE
|
| -
|
|
| (6,000)
|
|
|
|
|
|
|
NET PROFIT (LOSS)
| $
| (630,531)
|
| $
| 1,271,469
|
|
|
|
|
|
|
NET LOSS PER COMMON SHARE
|
|
|
|
|
|
Basic
| $
| (6,305)
|
| $
| 12,715
|
Diluted
| $
| (6,305)
|
| $
| 12,715
|
|
|
|
|
|
|
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING
|
|
|
|
|
|
Basic
|
| 100
|
|
| 100
|
Diluted
|
| 100
|
|
| 100
|
The accompanying notes are an integral part of these unaudited consolidated financial statements.
F-32
MEXEDIA, INC. AND SUBSIDIARIES
Consolidated Statement of Changes in Equity
For the Six Months Ended June 30, 2024 and 2023
(unaudited)
| Common Stock
|
| Retained Earnings
(Accumulated Deficit)
|
| Total
|
|
|
|
|
|
|
|
|
|
Balances at January 1, 2023
| $
| 100
|
| $
| (159,120)
|
| $
| (159,120)
|
Net profit (loss)
|
| -
|
|
| 1,271,469
|
|
| 1,271,469
|
Balances at June 30, 2023
| $
| 100
|
| $
| 1,112,349
|
| $
| 1,112,349
|
|
|
|
|
|
|
|
|
|
Balances at January 1, 2024
| $
| 100
|
| $
| 1,173,963
|
| $
| 1,173,963
|
Net profit (loss)
|
| -
|
|
| (630,531)
|
|
| (630,531)
|
Balances at June 30, 2024
| $
| 100
|
| $
| 543,432
|
| $
| 543,432
|
The accompanying notes are an integral part of these unaudited consolidated financial statements.
F-33
MEXEDIA, INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows
For the Six Months Ended June 30, 2024 and 2023
(unaudited)
| Six Months Ended June 30,
|
| 2024
|
| 2023
|
|
|
|
|
|
|
Statement of changes in cashflows
|
|
|
|
|
|
Net income (loss)
| $
| (630,531)
|
| $
| 1,271,469
|
Adjustments:
|
|
|
|
|
|
Provision for doubtful accounts
|
| -
|
|
| -
|
Interest expense
|
| -
|
|
| -
|
Amortization of intangible assets
|
| 564,550
|
|
| -
|
Provision for income taxes
|
| -
|
|
| -
|
Changes in operating assets and liabilities
|
| -
|
|
| -
|
Prepaid expenses and other current assets
|
| (223,557)
|
|
| 1,323,566
|
Accounts receivable
|
| 3,060,671
|
|
| 21,411,300
|
Accounts payable
|
| (4,948,751)
|
|
| (24,236,719)
|
Accrued expenses
|
| 1,622,069
|
|
| 290,210
|
Net cash - operating activities
|
| (555,549)
|
|
| 59,826
|
|
|
|
|
|
|
Cash acquired via business combination, net of cash paid of $250,000
|
| -
|
|
| 1,171,875
|
Net cash - investing activities
|
| -
|
|
| 1,171,875
|
|
|
|
|
|
|
Due to related party
|
| 577,287
|
|
| -
|
Net cash - financing activities
|
| 577,287
|
|
| -
|
|
|
|
|
|
|
Net change in cash
|
| 21,738
|
|
| 1,231,701
|
Cash - beginning of period
|
| 24,303
|
|
| 25,267
|
Cash - end of period
| $
| 46,041
|
| $
| 1,256,968
|
The accompanying notes are an integral part of these unaudited consolidated financial statements.
F-34
MEXEDIA, INC. AND SUBSIDIARIES
Notes to Unaudited Consolidated Financial Statements
June 30, 2024
1.ORGANIZATION AND DESCRIPTION OF BUSINESS
Mexedia, Inc. is a Florida Corporation organized in 2020. On January 1, 2023, Mexedia, Inc. acquired all the shares of Phonetime, Inc. and Matchcom Telecommunications, Inc. (collectively referred as the “Company”). The Company is a technology company in the areas of customer-management and telecom and provides retail and wholesale voice services and value-added platform services such as analytics, automation, and engagement.
The address of the Company’s registered office is 1680 Michigan Avenue, Suite 700, Miami Beach Florida 33139.
2.SIGNIFICANT ACCOUNTING POLICIES
Basis of Consolidation
The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All significant intercompany transactions and balances have been eliminated in consolidation.
The Company has a calendar year-end reporting date.
Basis of Presentation
The accompanying consolidated financial statements have been prepared in accordance with International Financial Reporting Standards and International Accounting Standards as issued by the International Accounting Standards Board (IASB) and Interpretations (collectively IFRSs).
Functional and Presentation Currency
These consolidated financial statements are presented in United States dollars, which is the Company’s functional currency.
Liquidity
The Company’s primary source of liquidity are the cash flows generated from operations and advances from related parties. These sources of liquidity are needed to fund the operations of the Company and its working capital requirements. Management believes the existing sources of cash will be sufficient to support the Company’s existing operations through at least twelve months from the date of the report.
Use of Estimates
The preparation of consolidated financial statements in conformity with IFRS requires the use of certain accounting estimates. It also requires management to exercise its judgment in the process of applying the Company’s accounting policies. Although these estimations, based on management’s knowledge of current events and actions it may undertake in the future, they may ultimately differ from actual results, and those differences may be material,
Concentrations of Credit Risk
Cash
Financial instruments, which potentially subject the Company to concentrations of credit risk, consist principally of cash deposits in excess of the Federal Deposit Insurance Corporation (“FDIC”) insured limit of $250,000. The Company generally limits its exposure by placing its deposits with quality financial institutions located in the United States. However, at times, such cash balances may be in excess of insured amounts.
F-35
Revenues
The Company relies on a significant portion of its revenue from major customers. Revenues from two customers represented 30% of the Company’s revenues for the six-months ended June 30, 2024. An adverse change in the Company’s relationship with these customers could have a material effect on the Company’s business, financial position, and results of operations.
Accounts Receivable
As of June 30, 2024, two customers. each of which accounted for more than 10% of the Company’s accounts receivable, accounted for 55% of total accounts receivable in aggregate.
Revenue Recognition
The Company recognizes revenue when a customer obtains control of the promised goods or services. The amount of revenue that is recorded reflects the consideration that the Company expects to receive in exchange for those goods or services. The Company applies the following five-step model in order to determine this amount: (t) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the Company satisfies a performance obligation. The Company only applies the five-step model to contracts when it is probable that the Company will collect the consideration it is entitled to in exchange for the goods or services the Company transfers to the customer. At contract inception, management reviews the contract to determine which performance obligations must be delivered and which of these performance obligations are distinct. The Company recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when the performance obligation is satisfied.
Accounts Receivable
The Company records accounts receivable in the ordinary course of business related to its sale of telecommunication products and services. The Company grants credit to various businesses and individuals located primarily in the United States and Europe. Accounts receivables are stated at the amount management expects to collect from outstanding balances. Management provides for probable uncollectible amounts through a charge to earnings and a credit to valuation allowance based on historical experience and management’s assessment of the status of individual accounts. Balances that are still outstanding after management has made reasonable collection efforts are written off through a charge to the valuation allowance and a credit to accounts receivable.
Accrued Revenue
Accrued revenue (unbilled accounts receivable) consists of revenue meeting the revenue recognition criteria but not yet invoiced at period end due to contract terms.
Goodwill and Intangible Assets
Goodwill represents the excess of the purchase price over the fair values underlying net assets acquired in an acquisition. Goodwill is allocated to a cash generating unit (CGU), or a group of CGUs, which cannot be larger than an operating segment before aggregation. A CGU is the smallest identifiable group of assets that generates largely independent cash flows.
Intangible assets with finite lives are amortized over the useful economic life and assessed for impairment whenever there is an indication that the intangible asset may be impaired. The amortization period and the amortization method for an intangible asset with a finite useful life are reviewed at least at the end of each reporting period. Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodied in the asset are considered to modify the amortization period or method, as appropriate, and are treated as changes in accounting estimates. The amortization expense on intangible assets with finite lives is recognized in the statement of profit and loss in the caption amortization expense.
Goodwill is tested at least annually for impairment or more frequently if an impairment indicator is present. An impairment loss is measured as the difference between the carrying amount of the CGU, including goodwill, and its recoverable amount. The recoverable amount is the higher of fair value less cost of disposal or value in use. Any impairment loss for a CGU is allocated first to any goodwill and then pro rata to other assets in the CGU. However, no asset is written down to below its known recoverable amount. There was no impairment of goodwill for the year ended June 30, 2024.
Intangible assets are to be tested for impairment if there is an indicator of impairment during the course of or at the end of the reporting period. During the period ended June 30, 2024, management believes there was no indicator of impairment of the intangible assets.
F-36
Accounts Payables and Accrued Expenses
Liabilities for accounts payable and other amounts are normally settled on 30 - 90-day terms and carried at cost which is the fair value of the consideration to be paid for goods and services received.
Financial Instruments
Financial instruments are initially recorded at cost, and consist of cash, accounts receivable, due from/to related parties, and accounts payable and accrued expenses. As of June 30, 2024, the carrying value of these financial instruments approximates their fair value due to their short-term nature
Income Taxes
The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilized. Unrecognized deferred tax assets are re-assessed at each reporting date and are recognized to the extent that it has become probable that future taxable profits will allow the deferred tax asset to be recovered. In assessing the recoverability of deferred tax assets, the Company relies on forecasted assumptions. Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is realized or the liability is settled, based on tax rates that have been enacted or substantively enacted at the reporting date. Deferred tax relating to items recognized outside profit or loss is recognized outside profit or loss. Deferred tax items are recognized in correlation to the underlying transaction directly in equity. Tax benefits acquired as part of a business combination, but not satisfying the criteria for separate recognition at that date, are recognized subsequently if new information about facts and circumstances change. The adjustment is either treated as a reduction in goodwill (as long as it does not exceed goodwill) if it was incurred during the measurement period or recognized in profit or loss.
The Company offsets deferred tax assets and deferred tax liabilities if and only if it has a legally enforceable right to set off current tax assets and current tax liabilities and the deferred tax assets and deferred tax liabilities relate to income taxes levied by the same taxation authority on either the same taxable entity or different taxable entities which intend either to settle current tax liabilities and assets on a net basis, or to realize the assets and settle the liabilities simultaneously, in each future period in which significant amounts of deferred tax liabilities or assets are expected to be settled or recovered
Some judgment is required in determining the provision for income taxes. There are many transactions and calculations for which the ultimate tax determination is uncertain during the ordinary course of business. The Company recognizes liabilities for anticipated tax based on estimates of whether additional taxes will be due. Where the final tax outcome of these matters is different from the amounts that were initially recorded, such differences will impact the income tax and deferred tax provisions in the period in which such determination is made,
Subsequent Events
The Company has evaluated subsequent events through August 15, 2024, which is the date the consolidated financial statements were available to be issued.
3.CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS
Estimates and judgments are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.
The Company makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are as follows:
Accounts Receivable
The Company assesses at each consolidated statement of financial position date the impact of the IFRS 9 simplified approach used to measure expected credit losses using a lifetime expected credit loss provision for trade receivables. As of June 30, 2024, the Company had no provisions for expected credit loss.
F-37
Goodwill and Intangible Assets
Assumptions and estimates at arriving at goodwill and intangible assets including the fair value of the assets acquired and liabilities assumed, the fair value of consideration transferred, and the estimated useful lives of the intangible assets.
4.RELATED PARTY TRANSACTIONS
Mexedia, Ltd.
Due to Related Parties
The Company from time to time is advanced monies for operational purposes by Mexedia, Ltd., a related entity through common ownership. As of June 30, 2024, the Company owed Mexedia Ltd. $6,252,327. This balance carries no interest and is due on demand. However, the Company does not expect to repay these balances over the next twelve months and as such has classified the balance as non-current on the accompanying statement of financial position.
5.BUSINESS COMBINATIONS
On January 1, 2023, the Company acquired two separate businesses as part of a single transaction. The acquisition was accounted for as a business combination using the acquisition method of accounting.
The Company entered into a Purchase Agreement (the “Agreement”) to purchase all of the outstanding shares of Phonetime, Inc. and Matchcom Telecommunications, Inc. (collectively referred to as the “Sellers”). The initial aggregate purchase consideration on the date of acquisition transferred to the Sellers totaled $3,000,000. Subsequent to the acquisition date, but during the measurernent period, management became aware that certain account receivables that were contingent of the final payment of $2,500,000, were not collected. As a result, management believes the Company is not entitled to make that payment based on the terms of the contract. Additionally, management believes the second payment of $250,000, due twelve months after closing, is also not due since management believes that payment was also tied to the collection of the same receivables. Therefore, management has adjusted the consideration due and the related goodwill amount to account for foregoing these payments. As a result, the eventual purchase price subsequent to the measurement period adjustments amounted to $250,000.
The purchase price for the acquisition has been allocated to the tangible assets acquired and liabilities assumed based upon their estimated fair values as of the Closing Date. There were no identifiable intangible assets. The excess of the purchase price over the estimated fair value of the tangible acquired and liabilities assumed has been recorded as goodwill.
The fair value of the acquired accounts receivable above approximates the carrying value of accounts receivable due to the short-term nature of the expected timeframe to collect amounts due to the Company and the contractual cash flows, which are expected to be collected related to these receivables.
Acquisition-related expenses were expensed as incurred. The results of operations are included in the consolidated financial statements of the Company from the date of acquisition.
6.COMMITMENTS AND CONTINGENCIES
Operating Leases
The Company leases office space in Miami Beach, Florida under a one-year operating lease through March 2025. The lease calls for monthly lease payments of approximately $350.
Litigation
In the ordinary course of business, the Company may become a party to various claims, legal actions and complaints. In the opinion of management, there were no matters that would have a material adverse effect on the consolidated financial condition of the Company as of June 30, 2024.
7.COMMON STOCK
As of June 30, 2024, the Company has authorized and issued 100 common stock shares with a par value of $1.00.
F-38
8.SUBSEQUENT EVENT
The Company has evaluated subsequent events through August 15, 2024, the date these consolidated financial statements were available to be issued.
F-39
MEXEDIA, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
(unaudited)
| December 31, 2023
|
| December 31, 2022
|
ASSETS
|
|
|
|
|
|
NON-CURRENT ASSETS
|
|
|
|
|
|
Intangible assets, net
| $
| 10,646,900
|
| $
| ---
|
Goodwill
|
| 1,610,261
|
|
| ---
|
TOTAL NON-CURRENT ASSETS
|
| 12,257,161
|
|
| ---
|
|
|
|
|
|
|
CURRENT ASSETS
|
|
|
|
|
|
Prepaid expenses and other current assets
|
| 8,668
|
|
| 2,908
|
Accounts receivable, net
|
| 31,360,759
|
|
| ---
|
Cash
|
| 24,303
|
|
| 25,267
|
Loan to Phonetime, Inc.
|
| ---
|
|
| 2,550,000
|
Other assets, purchase deposit
|
| ---
|
|
| 250,137
|
TOTAL CURRENT ASSETS
|
| 31,393,730
|
|
| 2,578,175
|
TOTAL ASSETS
| $
| 43,650,891
|
| $
| 2,828,312
|
|
|
|
|
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
CURRENT LIABILITIES
|
|
|
|
|
|
Deferred tax liability
| $
| 528,341
|
| $
| 2,004
|
Accounts payable
|
| 12,961,856
|
|
| 24,775
|
Accrued expenses
|
| 23,311,691
|
|
| ---
|
TOTAL CURRENT LIABILITIES
|
| 36,801,888
|
|
| 26,779
|
|
|
|
|
|
|
NON-CURRENT LIABILITIES
|
|
|
|
|
|
Due to related party
|
| 5,675,040
|
|
| 2,692,387
|
TOTAL LIABILITIES
|
| 42,476,928
|
|
| 2,719,166
|
|
|
|
|
|
|
COMMITMENTS AND CONTINGENCIES
|
|
|
|
|
|
EQUITY
|
| 1,173,963
|
|
| 109,146
|
TOTAL LIABILITIES AND EQUITY
| $
| 43,650,891
|
| $
| 2,828,312
|
The accompanying notes are an integral part of these unaudited consolidated financial statements.
F-40
MEXEDIA, INC. AND SUBSIDIARIES
Consolidated Statement of Profit and Loss
For the Years Ended December 31, 2023 and 2022
(unaudited)
| Years Ended December 31,
|
| 2023
|
| 2022
|
|
|
|
|
|
|
REVENUES, NET
| $
| 215,325,822
|
| $
| 276,535
|
COST OF SALES
|
| 207,738,077
|
|
| ---
|
GROSS PROFIT
|
| 7,587,745
|
|
| 276,535
|
|
|
|
|
|
|
OPERATING EXPENSES
|
|
|
|
|
|
Salaries and benefits
|
| 1,703,710
|
|
| 148,265
|
Professional fees
|
| 326,550
|
|
| 35,575
|
Bad debt expense
|
| 200,971
|
|
| ---
|
Amortization expense
|
| 1,129,100
|
|
| ---
|
Other operating expenses
|
| 437,459
|
|
| 255,430
|
TOTAL OPERATING EXPENSES
|
| 3,797,790
|
|
| 439,270
|
|
|
|
|
|
|
OPERATING PROFIT (LOSS)
|
| 3,789,955
|
|
| (162,735)
|
|
|
|
|
|
|
FINANCE COSTS
|
| (1,928,631)
|
|
| ---
|
|
|
|
|
|
|
PROFIT BEFORE TAX EXPENSE
|
| 1,861,324
|
|
| (162,735)
|
|
|
|
|
|
|
TAX EXPENSE
|
| (528,344)
|
|
| ---
|
|
|
|
|
|
|
PROFIT (LOSS)
| $
| 1,332,983
|
| $
| (162,735)
|
|
|
|
|
|
|
NET LOSS PER COMMON SHARE
|
|
|
|
|
|
Basic
| $
| 13,330
|
| $
| (1,627)
|
Diluted
| $
| 13,330
|
| $
| (1,627)
|
|
|
|
|
|
|
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING
|
|
|
|
|
|
Basic
|
| 100
|
|
| 100
|
Diluted
|
| 100
|
|
| 100
|
The accompanying notes are an integral part of these unaudited consolidated financial statements.
F-41
MEXEDIA, INC. AND SUBSIDIARIES
Consolidated Statement of Changes in Equity
For the Years Ended December 31, 2023 and 2022
(unaudited)
| Common Stock
|
| Retained Earnings
(Accumulated Deficit)
|
| Total
|
|
|
|
|
|
|
|
|
|
Balances at January 1, 2022
| $
| -
|
| $
| -
|
| $
| -
|
Issuance of common stock
|
| -
|
|
| -
|
|
| -
|
Net loss
|
| -
|
|
| -
|
|
| -
|
Balances at December 31, 2022
| $
| 100
|
| $
| (159,120)
|
| $
| (159,020)
|
Net income
|
| -
|
|
| 1,332,983
|
|
| 1,332,983
|
Balances at December 31, 2023
| $
| 100
|
| $
| 1,173,863
|
| $
| 1,173,863
|
The accompanying notes are an integral part of these unaudited consolidated financial statements.
F-42
MEXEDIA, INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows
For the Years Ended December 31, 2023 and 2022
(unaudited)
| Years Ended December 31,
|
| 2023
|
| 2022
|
|
|
|
|
|
|
CASH FLOWS FROM OPERATING ACTIVITIES
|
|
|
|
|
|
Net income (loss)
| $
| 1,322,983
|
| $
| (162,735)
|
Adjustments to reconcile net income to net cash used in operating activities:
|
|
|
|
|
|
Provision for doubtful accounts
|
| 200,971
|
|
| ---
|
Interest expense
|
| 378,201
|
|
| 179,960
|
Amortization of intangible assets
|
| 1,129,100
|
|
| ---
|
Provision for income taxes
|
| 528,341
|
|
| ---
|
Changes in operating assets and liabilities
|
|
|
|
|
|
Prepaid expenses and other current assets
|
| 2,146,732
|
|
| 2,908
|
Accounts receivable
|
| 29,919,255
|
|
| ---
|
Accounts payable
|
| (20,514,338)
|
|
| ---
|
Accrued expenses
|
| (18,844,084)
|
|
| 137
|
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES
|
| (3,722,839)
|
|
| 20,270
|
|
|
|
|
|
|
CASH FLOWS FROM INVESTING ACTIVITIES
|
|
|
|
|
|
Decrease in due from related party
|
| 2,950,000
|
|
| ---
|
Cash acquired via business combination, net of cash paid of $250,000
|
| 1,171,875
|
|
| ---
|
Purchase deposit for business combination
|
| ---
|
|
| (250,000)
|
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES
|
| 4,121,875
|
|
| (250,000)
|
|
|
|
|
|
|
CASH FLOWS FROM FINANCING ACTIVITIES
|
|
|
|
|
|
Decrease in due to related party
|
| (400,000)
|
|
| 2,692,387
|
Loan granted to commercial partner
|
| ---
|
|
| (2,550,000)
|
NET CASH USED IN FINANCING ACTIVITIES
|
| (400,000)
|
|
| 142,387
|
|
|
|
|
|
|
NET INCREASE (DECREASE) IN CASH
|
| (964)
|
|
| (87,343)
|
CASH, BEGINNING OF PERIOD
|
| 25,267
|
|
| 112,610
|
CASH, END OF PERIOD
| $
| 24,303
|
| $
| 25,267
|
The accompanying notes are an integral part of these unaudited consolidated financial statements.
F-43
MEXEDIA, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
December 31, 2023 and 2022
1.ORGANIZATION AND DESCRIPTION OF BUSINESS
Mexedia, Inc. is a Florida Corporation organized in 2020. On January 1, 2023, Mexedia, Inc. acquired all the shares of Phonetime, Inc. and Matchcom Telecommunications, Inc. (collectively referred as the “Company”). The Company is a technology company in the areas of customer-management and telecom and provides retail and wholesale voice services and value-added platform services such as analytics, automation, and engagement.
The address of the Company’s registered office is 1680 Michigan Avenue, Suite 700, Miami Beach Florida 33139.
2.SIGNIFICANT ACCOUNTING POLICIES
Basis of Consolidation
The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All significant intercompany transactions and balances have been eliminated in consolidation.
The Company has a calendar year-end reporting date.
Basis of Presentation
The accompanying consolidated financial statements have been prepared in accordance with International Financial Reporting Standards and International Accounting Standards as issued by the International Accounting Standards Board (IASB) and Interpretations (collectively IFRSs).
Functional and Presentation Currency
These consolidated financial statements are presented in United States dollars, which is the Company’s functional currency.
Liquidity
The Company’s primary source of liquidity are the cash flows generated from operations and advances from related parties. These sources of liquidity are needed to fund the operations of the Company and its working capital requirements. Management believes the existing sources of cash will be sufficient to support the Company’s existing operations through at least twelve months from the date of the report.
Use of Estimates
The preparation of consolidated financial statements in conformity with IFRS requires the use of certain accounting estimates. It also requires management to exercise its judgment in the process of applying the Company’s accounting policies. Although these estimations, based on management’s knowledge of current events and actions it may undertake in the future, they may ultimately differ from actual results, and those differences may be material,
Concentrations of Credit Risk
Cash
Financial instruments, which potentially subject the Company to concentrations of credit risk, consist principally of cash deposits in excess of the Federal Deposit Insurance Corporation (“FDIC”) insured limit of $250,000. The Company generally limits its exposure by placing its deposits with quality financial institutions located in the United States. However, at times, such cash balances may be in excess of insured amounts.
Revenues
The Company relies on a significant portion of its revenue from major customers. Revenues from two customers represented 30% of the Company’s revenues for the year ended December 31, 2023. An adverse change in the Company’s relationship with these customers could have a material effect on the Company’s business, financial position, and results of operations.
F-44
Accounts Receivable
As of December 31, 2023, two customers. each of which accounted for more than 10% of the Company’s accounts receivable, accounted for 55% of total accounts receivable in aggregate.
Revenue Recognition
Under IFRS 15, the Company recognizes revenue when a customer obtains control of the promised goods or services. The amount of revenue that is recorded reflects the consideration that the Company expects to receive in exchange for those goods or services. The Company applies the following five-step model in order to determine this amount: (t) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iV) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the Company satisfies a performance obligation. The Company only applies the five-step model to contracts when it is probable that the Company will collect the consideration it is entitled to in exchange for the goods or services the Company transfers to the customer. At contract inception, once the contract is determined to be within the scope of IFRS 15, management reviews the contract to determine which performance obligations must be delivered and which of these performance obligations are distinct. The Company recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when the performance obligation is satisfied.
The following is a description of the business units, from which the Company generates its revenues.
•Carrier sales - reflects the sales of Wholesale Voice over the Internet protocol (VoIP) traffic It consists of large sales volumes (minutes of traffic, destinations, and rates) of traffic exchanged with our customers. The Company is responsible for raising or “buying” the forecasted traffic to sell to its customers.
•SMS sales - Similarly as VoIP sales, SMS or “Short Messaging Services” includes the sale of messages on a wholesale basis to the Company’s customers, for termination within their network of suppliers.
•Late fees - amounts charged for delinquent accounts and contractual agreements.
The table below sets forth the Company’s revenue disaggregated within each business unit for the year ended December 31, 2023:
Carrier
|
| $
| 210,076,611
|
SMS
|
|
| 5,198,306
|
Late Fees
|
|
| 50,905
|
|
| $
| 215,325,822
|
Accounts Receivable
The Company records accounts receivable in the ordinary course of business related to its sale of telecommunication products and services. The Company grants credit to various businesses and individuals located primarily in the United States and Europe. Accounts receivables are stated at the amount management expects to collect from outstanding balances. Management provides for probable uncollectible amounts through a charge to earnings and a credit to valuation allowance based on historical experience and management’s assessment of the status of individual accounts. Balances that are still outstanding after management has made reasonable collection efforts are written off through a charge to the valuation allowance and a credit to accounts receivable. Management has reserved approximately $95,000 towards the allowance for doubtful accounts as of December 31, 2023.
Accrued Revenue
Accrued revenue (unbilled accounts receivable) consists of revenue meeting the revenue recognition criteria but not yet invoiced at period end due to contract terms.
Business Combinations
The Company accounts for business combinations in accordance with IFRS 3, Business Combinations (“IFRS 3”), which requires that the Company allocates the purchase price to the tangible and intangible assets acquired and the liabilities assumed based on estimated fair values. This guidance requires the Company to make significant estimates and assumptions, including fair value estimates, as of the acquisition date and to adjust those estimates as necessary during the measurement period (defined as the period, not to exceed one year, in which the Company may adjust the provisional amounts recognized for an acquisition). Should the initial accounting for an acquisition be incomplete by the end of a reporting period that falls within the measurement period, the Company reports provisional amounts in its consolidated financial statements. During the measurement period, the Company adjusts the provisional amounts recognized at the acquisition date to reflect new information obtained about facts and circumstances that existed as of the acquisition date that, if known,
F-45
would have affected the measurement of the amounts recognized as of that date, and the Company records those adjustments to its consolidated financial statements.
Goodwill and Intangible Assets
Goodwill represents the excess of the purchase price over the fair values underlying net assets acquired in an acquisition. Under International Accounting Standard (“IAS”) 36, goodwill is allocated to a cash generating unit (CGU), or a group of CGUs, which cannot be larger than an operating segment before aggregation. A CGU is the smallest identifiable group of assets that generates largely independent cash flows.
Intangible assets with finite lives are amortized over the useful economic life and assessed for impairment whenever there is an indication that the intangible asset may be impaired. The amortization period and the amortization method for an intangible asset with a finite useful life are reviewed at least at the end of each reporting period. Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodied in the asset are considered to modify the amortization period or method, as appropriate, and are treated as changes in accounting estimates. The amortization expense on intangible assets with finite lives is recognized in the statement of profit and loss in the caption amortization expense.
Under IAS 36, goodwill is tested at least annually for impairment or more frequently if an impairment indicator is present. An impairment loss is measured as the difference between the carrying amount of the CGU, including goodwill, and its recoverable amount. The recoverable amount is the higher of fair value less cost of disposal or value in use. Any impairment loss for a CGU is allocated first to any goodwill and then pro rata to other assets in the CGU. However, no asset is written down to below its known recoverable amount. There was no impairment of goodwill for the year ended December 31, 2023
Intangible assets are to be tested for impairment if there is an indicator of impairment during the course of or at the end of the reporting period. During 2023, management believes there was no indicator of impairment of the intangible assets.
Accounts Payables and Accrued Expenses
Liabilities for accounts payable and other amounts are normally settled on 30 - 90-day terms and carried at cost which is the fair value of the consideration to be paid for goods and services received.
Financial Instruments
Financial instruments are initially recorded at cost, and consist of cash, accounts receivable, due from/to related parties, and accounts payable and accrued expenses. As of December 31, 2023, the carrying value of these financial instruments approximates their fair value due to their short-term nature
Income Taxes
The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilized. Unrecognized deferred tax assets are re-assessed at each reporting date and are recognized to the extent that it has become probable that future taxable profits will allow the deferred tax asset to be recovered. In assessing the recoverability of deferred tax assets, the Company relies on forecasted assumptions. Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is realized or the liability is settled, based on tax rates that have been enacted or substantively enacted at the reporting date. Deferred tax relating to items recognized outside profit or loss is recognized outside profit or loss. Deferred tax items are recognized in correlation to the underlying transaction directly in equity. Tax benefits acquired as part of a business combination, but not satisfying the criteria for separate recognition at that date, are recognized subsequently if new information about facts and circumstances change. The adjustment is either treated as a reduction in goodwill (as long as it does not exceed goodwill) if it was incurred during the measurement period or recognized in profit or loss.
The Company offsets deferred tax assets and deferred tax liabilities if and only if it has a legally enforceable right to set off current tax assets and current tax liabilities and the deferred tax assets and deferred tax liabilities relate to income taxes levied by the same taxation authority on either the same taxable entity or different taxable entities which intend either to settle current tax liabilities and assets on a net basis, or to realize the assets and settle the liabilities simultaneously, in each future period in which significant amounts of deferred tax liabilities or assets are expected to be settled or recovered
Some judgment is required in determining the provision for income taxes. There are many transactions and calculations for which the ultimate tax determination is uncertain during the ordinary course of business. The Company recognizes liabilities for anticipated tax based on estimates of whether additional taxes will be due. Where the final tax outcome of these matters is different from the amounts
F-46
that were initially recorded, such differences will impact the income tax and deferred tax provisions in the period in which such determination is made,
Offsetting
As of December 31, 2023, the Company offset a portion of accounts receivable and accounts payable, A right to offset is a debtor’s right, by contract or otherwise, to settle or otherwise eliminate all or a portion of an amount due to a creditor by applying against that amount an amount due from the creditor. Two conditions must exist for an entity to offset a financial liability (and thus present the net amount on the balance sheet). The entity must both: 1) Currently have a legally enforceable right to offset and 2) Intent either to settle on a net basis or to realize the asset and settle the liability simultaneously Management believes both of these conditions exist on December 31, 2023.
Offsetting of accounts receivable - As of December 31, 2023:
|
| Gross amounts of
recognized assets
|
| Gross amounts offset
in the consolidated
balance sheet
|
| Net amounts of assets
presented in the
consolidated
balance sheets
|
Accounts receivable
|
| $ 36,513,193
|
| $ (5,152,434)
|
| $ 31,360,759
|
Offsetting of accounts payable - As of December 31, 2023:
|
| Gross amounts of
recognized liabilities
|
| Gross amounts offset
in the consolidated
balance sheet
|
| Net amounts of assets
presented in the
consolidated
balance sheets
|
Accounts payable
|
| $ 18,114,290
|
| $ (5,152,434)
|
| $ 12,961,856
|
Foreign Currency
The Company’s functional currency is the U.S. dollar. Gains and losses from translation of foreign currency financial statements into U.S. dollars are included in current results of operations. Gains and Iosses resulting from foreign currency transactions are also included in current results of operations.
Standards, Amendments, and Interpretations to Existing Standards That are Not Yet Effective
The Company has not applied the following new or revised standards, amendments and interpretations to existing standards that have been issued but are not yet effective:
•Classification of liabilities as current or non-current and non-current liabilities with covenants (Amendments to IAS 1)
•Supplier finance arrangements (IAS 7 and IFRS 7)
•Lease liability in a sale and leaseback (Amendments to IFRS 16)
•Lack of exchangeability (Amendments to IAS 21)
The Company’s management does not expect that the adoption of these standards or interpretations in future periods will have a material impact on the financial statements of the Company.
Subsequent Events
The Company has evaluated subsequent events through March 18, 2024, which is the date the consolidated financial statements were available to be issued.
F-47
3.CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS
Estimates and judgments are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.
The Company makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are as follows:
Accounts Receivable
The Company assesses at each consolidated statement of financial position date the impact of the IFRS 9 simplified approach used to measure expected credit losses using a lifetime expected credit loss provision for trade receivables. As of December 31, 2023, the Company has a provision for expected credit loss of approximately $95,000.
Goodwill and Intangible Assets
Assumptions and estimates at arriving at goodwill and intangible assets including the fair value of the assets acquired and liabilities assumed, the fair value of consideration transferred, and the estimated useful lives of the intangible assets.
4.ACCOUNTS RECEIVABLE
Accounts receivable consist of the following at December 31, 2023:
Billed accounts receivable, net
|
| $
| 18,904,934
|
Unbilled accounts receivable
|
|
| 12,455,825
|
|
| $
| 31,360,759
|
5.RELATED PARTY TRANSACTIONS
Mexedia, Ltd.
Due to Related Parties
The Company from time to time is advanced monies for operational purposes by Mexedia, Ltd., a related entity through common ownership. As of December 31, 2023, the Company owes Mexedia, Ltd. $5,675,040. This balance bears interest at 6.00% and is due on demand. However, the Company does not expect to repay these balances over the next twelve months and as such has classified the balance as non-current on the accompanying statement of financial position
Interest expense related to these advances totaled approximately $378,000 for the year ended December 31, 2023 and is included within the caption finance costs in the accompanying consolidated statement of profit and loss.
Accounts Receivable, net - Related Parties
As of December 31, 2023, $529,473 of unbilled accounts receivable were due from Mexedia, Ltd. This balance is included within the caption accounts receivable, net in the accompanying consolidated statement of financial position.
Accounts Payable - Related Parties
As of December 31, 2023, accounts payable to Mexedia, Ltd, total $2,758,303. This balance is included within the caption accounts payable in the accompanying consolidated balance sheet.
Sales - Related Parties
During 2023, the Company sold approximately $17,073,536 of services to Mexedia, Ltd.
Purchases- Related Parties
During 2023, the Company purchased approximately $5,313,000 of services from Mexedia, Ltd.
F-48
6.BUSINESS COMBINATIONS
On January 1, 2023, the Company acquired two separate businesses as part of a single transaction The acquisition was accounted for as a business combination using the acquisition method of accounting in accordance with IFRS 3, Business Combinations.
The Company entered into a Purchase Agreement (the “Agreement”) to purchase all of the outstanding shares of Phonetime, Inc. and Matchcom Telecommunications, Inc. (collectively referred to as the “Sellers”). The initial aggregate purchase consideration on the date of acquisition transferred to the Sellers totaled $3,000,000. Subsequent to the acquisition date, but during the measurernent period, management became aware that certain account receivables that were contingent of the final payment of $2,500,000, were not collected. As a result, management believes the Company is not entitled to make that payment based on the terms of the contract. Additionally, management believes the second payment of $250,000, due twelve months after closing, is also not due since management believes that payment was also tied to the collection of the same receivables. Therefore, management has adjusted the consideration due and the related goodwill amount to account for foregoing these payments. As a result, the eventual purchase price subsequent to the measurement period adjustments amounted to $250,000.
Cash deposit held in escrow:
|
| $
| 250,000
|
Twelve months from date of closing:
|
|
| 250,000
|
Should certain accounts receivable be collected as described in the purchase agreement:
|
|
| 2,500,000
|
Initial purchase price:
|
|
| 3,000,000
|
Measurement period adjustments:
|
|
| (2,750,000)
|
Adjusted purchase price:
|
| $
| 250,000
|
The purchase price for the acquisition has been allocated to the tangible assets acquired and liabilities assumed based upon their estimated fair values as of the Closing Date. There were no identifiable intangible assets. The excess of the purchase price over the estimated fair value of the tangible acquired and liabilities assumed has been recorded as goodwill
Fair values of assets acquired, and liabilities assumed, net of measurement period adjustments of $2,750,000:
Customer relationships
|
| $
| 10,321,000
|
Goodwill
|
|
| 1,610,261
|
Tradenames
|
|
| 1,455,000
|
Goodwill and identifiable intangible assets acquired
|
|
| 13,386,261
|
Cash
|
|
| 1,421,875
|
Accounts receivable
|
|
| 61,480,985
|
Prepaid expenses and other current assets
|
|
| 1,902,492
|
Accounts payable and accrued expenses
|
|
| (75,041,613)
|
Due to related parties
|
|
| (2,900,000)
|
Net working capital deficit assumed
|
|
| (2,900,000)
|
Purchase price
|
| $
| 250,000
|
The fair value of the acquired accounts receivable above approximates the carrying value of accounts receivable due to the short-term nature of the expected timeframe to collect amounts due to the Company and the contractual cash flows, which are expected to be collected related to these receivables.
Acquisition related expenses were expensed as incurred. The results of operations are included in the consolidated financial statements of the Company from the date of acquisition.
F-49
7.GOODWILL AND INTANGIBLE ASSETS
As of December 31, 2023, the Company has the following amounts related to goodwill and intangible assets:
| Goodwill
|
| Customer
relationships
|
| Tradenames
|
| Total
|
Cost
|
|
|
|
|
|
|
|
|
|
|
|
Balances at January 1, 2023
| $
| ---
|
| $
| ---
|
| $
| ---
|
| $
| ---
|
Acquisitions
|
| 1,610,261
|
|
| 10,321,000
|
|
| 1,455,000
|
|
| 13,386,261
|
Balances at December 31, 2023
| $
| 1,610,261
|
| $
| 10,321,000
|
| $
| 1,455,000
|
| $
| 13,386,261
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated Amortization
|
|
|
|
|
|
|
|
|
|
|
|
Balances at January 1, 2023
| $
| ---
|
| $
| ---
|
| $
| ---
|
| $
| ---
|
Amortization
|
| ---
|
|
| 1,032,000
|
|
| 97,000
|
|
| 1,129,100
|
Balances at December 31, 2023
| $
| 1,610,261
|
| $
| 1,032,000
|
| $
| 97,000
|
| $
| 1,129,100
|
Carrying amounts at January 1, 2023
| $
| ---
|
| $
| ---
|
| $
| ---
|
| $
| ---
|
Carrying amounts at December 31, 2023
| $
| 1,610,261
|
| $
| 9,288,900
|
| $
| 1,358,000
|
| $
| 12,257,161
|
The Company’s estimated useful lives for its intangible assets is as follows:
|
| Useful lives
|
Goodwill
|
| Annual impairment test
|
Customer relationships
|
| 10
|
Tradenames
|
| 15
|
Amortization expense for the year ended December 31, 2023, totaled $1,129,100. The following table represents the total estimated amortization of intangible assets for the five succeeding years and thereafter:
For the Years Ending
December 31,
|
| Estimated
Amortization
|
2024
|
| 1,129,100
|
2025
|
| 1,129,100
|
2026
|
| 1,129,100
|
2027
|
| 1,129,100
|
2028
|
| 1,129,100
|
Thereafter
|
| 5,001,400
|
Total
|
| 10,646,900
|
8.ACCRUED EXPENSES
Accrued expenses consists of the following at December 31, 2023:
Accrued telecommunication costs
|
| $
| 22,253,616
|
Other accrued expenses
|
|
| 1,058,075
|
|
| $
| 23,311,691
|
9.INCOME TAXES
The provision for income taxes is computed using the asset and liability method, under which deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities and for operating losses and tax credit carryforwards. Deferred tax assets and liabilities are measured using the currently enacted tax rates that apply to taxable income in effect for the years in which those tax assets and liabilities are expected to be realized or settled. The Company records a valuation allowance to reduce deferred tax assets to the amount that is believed more likely than not to be realized.
Uncertain tax positions are recognized only when the Company believes it is more likely than not that the tax position will be upheld on examination by the taxing authorities based on the merits of the position. The Company has no material unrecognized tax benefits and no adjustments to its consolidated financial position, results of operations or cash flows were required as of December 31, 2023.
The Company’s tax return for the year ended December 31, 2023 remains subject to examination by federal and state tax jurisdictions. No income tax returns are currently under examination by taxing authorities. The Company recognizes interest and penalties, if any,
F-50
related to uncertain tax positions in income tax expense. The Company did not have any accrued interest or penalties associated with uncertain tax positions as of December 31, 2023.
The federal and state income tax provision (benefit) is summarized as follows:
| 2023
|
|
|
Federal:
| $
| 437,765
|
Current
|
| (42,738)
|
Deferred
|
| 385,027
|
|
|
|
State:
|
| 90,576
|
Current
|
| (8,843)
|
Deferred
|
| 81,733
|
|
|
|
Change in valuation allowance of deferred tax assets
|
| 51,580
|
Income tax
| $
| 528,341
|
No benefit for income taxes has been recorded due to the uncertainty of the realization of any tax assets. At December 31, 2023, the Company had approximately $8,200 of net operating losses.
The components of the Company’s deferred tax assets are as follows:
| 2023
|
Deferred income tax assets:
|
|
Related party interest expense
| $
| 95,855
|
Allowance for bad debts
|
| 24,148
|
Amortization
|
| (27,208)
|
Net operating losses
|
| 1,726,600
|
|
| 1,819,395
|
|
|
|
Valuation allowance of deferred tax assets
|
| (1,819,395)
|
Net deferred tax asset
| $
| ---
|
A reconciliation of the provision for income taxes with amounts determined by applying the statutory U.S. federal income tax rate to income before income taxes is as follows:
| 2023
|
|
|
Computed tax at the federal rate of 21%
| $
| 390,878
|
State taxes, net of federal benefit
|
| 80,875
|
Related party interest expenses
|
| 95,855
|
Allowance for bad debts
|
| 24,148
|
Amortization
|
| (27,208)
|
Operating loss carryforwards
|
| (41,215)
|
Permanent differences
|
| 5,008
|
Provision for income taxes
| $
| 528,341
|
Effective income tax rate
|
| 25.35%
|
At December 31, 2023, the Company has available unused net operating losses and investment tax credits carryforwards that may be applied against future taxable income and that expire as follows:
Year of Expiration
|
| Net Operating Loss
Carryforwards
|
Indefinite
|
| $
| (8,225)
|
F-51
10.COMMITMENTS AND CONTINGENCIES
Operating Leases
The Company leases office space in Miami Beach, Florida under a one-year operating lease through March 2024. The lease calls for monthly lease payments of approximately $350.
For the year ended December 31, 2023, total rent expense for the Company totaled approximately $3,000.
Management believes IFRS 16 did not have a material impact on the Company’s operations due the Company not having any material leases.
Litigation
In the ordinary course of business, the Company may become a party to various claims, legal actions and complaints. In the opinion of management, there were no matters that would have a material adverse effect on the consolidated financial condition of the Company as of December 31, 2023.
11.COMMON STOCK
As of December 31, 2023, the Company has authorized and issued 100 common stock shares with a par value of $1.00.
12.POST REPORTING DATE EVENTS
No post reporting date events have occurred between the reporting date and the date of authorization of these consolidated financial statements, which would require adjusting the consolidated financial statements.
13.AUTHORIZATION OF FINANCIAL STATEMENTS
For the year ended December 31, 2023, the consolidated financial statements of the Company were approved by Daniel Contreras, Chief Executive Officer, on March 18, 2024.
14.SUBSEQUENT EVENT
The Company has evaluated subsequent events through March 18, 2024, the date these consolidated financial statements were available to be issued.
During February 2024, in an effort to streamline operations and better serve its customer base, Phonetime, Inc. transferred substantially all of its customers contracts to Mexedia, Inc. and to Mexedia, Ltd. (also a related entity through common ownership).
F-52
MEXEDIA DESIGNATED ACTIVITY COMPANY
UNAUDITED STATEMENT OF FINANCIAL POSITION
AS AT JUNE 30, 2024
|
| June 30, 2024
|
| December 31, 2023
|
|
|
|
|
|
|
|
Assets
|
|
|
|
|
|
|
Non-current assets
|
|
|
|
|
|
|
Property, plant and equipment
|
| $
| 52,547
|
| $
| 57,664
|
Goodwill
|
|
| -
|
|
| -
|
Other intangible assets
|
|
| 75,000
|
|
| 75,000
|
Investments in associates
|
|
| -
|
|
| -
|
Other non-current assets
|
|
| 9,752
|
|
| 9,751
|
Deferred taxes
|
|
| -
|
|
| -
|
|
|
| 137,299
|
|
| 142,415
|
|
|
|
|
|
|
|
Current assets
|
|
|
|
|
|
|
Inventories
|
|
| -
|
|
| -
|
Trade receivables
|
|
| 39,552,279
|
|
| 40,702,777
|
Short-term loans
|
|
| 12,407,443
|
|
| 13,715,040
|
Taxes and other current assets
|
|
| 1,982,837
|
|
| 558,452
|
Cash and cash equivalents
|
|
| 82,067
|
|
| 98,617
|
Accruals
|
|
| 82,904
|
|
| 93,965
|
|
|
| 54,107,530
|
|
| 55,168,851
|
Total assets
|
| $
| 54,244,829
|
| $
| 55,311,266
|
|
|
|
|
|
|
|
Equity and liabilities
|
|
|
|
|
|
|
Equity
|
| $
|
|
| $
|
|
Share capital
|
|
| 1,000
|
|
| 1,000
|
Other reserves
|
|
| 2,000,000
|
|
| 2,000,000
|
Translation difference
|
|
| -
|
|
| -
|
Retained earnings
|
|
| (1,440,668)
|
|
| (1,575,264)
|
Net profit (loss) for the financial period
|
|
| (2,428,709)
|
|
| 1,585,133
|
Equity attributable to equity owners of the Group
|
|
| (1,868,377)
|
|
| 2,010,869
|
Minority interests
|
|
| -
|
|
| -
|
|
|
| (1,868,377)
|
|
| 2,010,869
|
|
|
|
|
|
|
|
Non-current liabilities
|
|
|
|
|
|
|
Long-term borrowings
|
|
| -
|
|
| -
|
Financial debt on repurchase of minority interests
|
|
| -
|
|
| -
|
Deferred tax liabilities
|
|
| -
|
|
| -
|
Retirement benefits obligations
|
|
| -
|
|
| -
|
Provisions for other liabilities
|
|
| 12,000
|
|
| 12,000
|
Total non-current liabilities
|
|
| 12,000
|
|
| 12,000
|
|
|
|
|
|
|
|
Current liabilities
|
|
|
|
|
|
|
Short-term borrowings
|
|
| 41,791,319
|
|
| 41,821,898
|
Trade payables
|
|
| 9,584,136
|
|
| 7,488,264
|
Taxes payable
|
|
| 15,162
|
|
| 204,042
|
Other current liabilities
|
|
| 4,710,589
|
|
| 3,774,193
|
Accruals
|
|
| -
|
|
| -
|
Total current liabilities
|
|
| 56,101,206
|
|
| 53,288,397
|
Total equity and liabilities
|
| $
| 54,244,829
|
| $
| 55,311,266
|
The accompanying notes are an integral part of these unaudited financial statements.
F-53
MEXEDIA DESIGNATED ACTIVITY COMPANY
UNAUDITED STATEMENT OF COMPREHENSIVE INCOME
FOR THE SIX MONTHS ENDED JUNE 30, 2024
|
| June 30, 2024
|
| June 30, 2023
|
|
|
|
|
|
|
|
Revenue
|
| $
| 19,290,476
|
| $
| 39,768,401
|
Cost of sales
|
|
| (17,729,909)
|
|
| (35,091,883)
|
Gross profit
|
|
| 1,560,567
|
|
| 4,676,519
|
|
|
|
|
|
|
|
General and administration
|
|
| (630,898)
|
|
| (1,596,106)
|
Other income
|
|
| -
|
|
| -
|
Other expenses
|
|
| (40,757)
|
|
| (39,255)
|
Depreciation and amortization
|
|
| (5,117)
|
|
| (82,029)
|
Operating profit (loss)
|
|
| 883,795
|
|
| 2,959,129
|
|
|
|
|
|
|
|
Finance income (costs)
|
|
| (3,100,749)
|
|
| (1,786,459)
|
Other non-operating income
|
|
| 80,812
|
|
| 3,466
|
Other non-operating expenses
|
|
| (292,567)
|
|
| (99,042)
|
Profit (loss) before taxation
|
|
| (2,428,709)
|
|
| 1,077,093
|
|
|
|
|
|
|
|
Income taxes
|
|
| -
|
|
| (134,637)
|
Net profit (loss) for the financial period
|
| $
| (2,428,709)
|
| $
| 942,456
|
The accompanying notes are an integral part of these unaudited financial statements.
F-54
MEXEDIA DESIGNATED ACTIVITY COMPANY
UNAUDITED STATEMENT OF CHANGES IN EQUITY
FOR THE SIX MONTHS ENDED JUNE 30, 2024
| Notes
|
| Share
Capital
|
| Revaluation
Reserve
|
| Profit and
Loss Reserves
|
| Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at 1 January 2023
|
|
| $
| 1,000
|
| $
| 2,000,000
|
| $
| 5,263,968
|
| $
| 7,264,968
|
Net profit (loss)
|
|
|
| -
|
|
| -
|
|
| 942,456
|
|
| 942,456
|
Balance at 30 June 2023
|
|
| $
| 1,000
|
| $
| 2,000,000
|
| $
| 6,206,424
|
| $
| 8,207,424
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at 1 January 2024
|
|
| $
| 1,000
|
| $
| 2,000,000
|
| $
| 11,431,955
|
| $
| 3,432,955
|
Net profit (loss)
|
|
|
| -
|
|
| -
|
|
| (2,428,709)
|
|
| (2,428,709)
|
Balance at 30 June 2024
|
|
| $
| 1,000
|
| $
| 2,000,000
|
| $
| 9,003,246
|
| $
| 1,004,246
|
The accompanying notes are an integral part of these unaudited financial statements.
F-55
MEXEDIA DESIGNATED ACTIVITY COMPANY
UNAUDITED STATEMENT OF CASH FLOWS
FOR THE SIX MONTHS ENDED JUNE 30, 2024
|
| June 30, 2024
|
| June 30, 2023
|
|
|
|
|
|
|
|
A) Cash flows from current activities
|
|
|
|
|
|
|
Profit (loss) for the period
|
| $
| (2,428,709)
|
| $
| 942,456
|
Income tax
|
|
| -
|
|
| 134,637
|
Payable (receivable) interest
|
|
| 3,100,749
|
|
| 1,786,459
|
1) Profit (loss) for the year before income tax, interest, dividends and capital gains/losses from convenances
|
|
| 672,040
|
|
| 2,863,552
|
Adjustments to non monetary items that were not offset in the net working capital
|
|
|
|
|
| -
|
Provisions
|
|
| -
|
|
| (3,000)
|
Other non-monetary items
|
|
| 67,298
|
|
| 134,587
|
Fixed asset depreciation/amortisation
|
|
| 5,117
|
|
| 82,029
|
Total adjustments for non-monetary items that were not offset in the net working capital
|
|
| 72,415
|
|
| 213,616
|
2) Cash flow before changing net working capital
|
|
| 744,455
|
|
| 3,077,168
|
Changes to the net working capital
|
|
|
|
|
|
|
Decrease/(increase) in trade receivables
|
|
| (6,278,394)
|
|
| (9,360,222)
|
Increase/(decrease) in trade payables
|
|
| 7,017,724
|
|
| (1,664,151)
|
Decrease/(increase) from prepayments and accrued income
|
|
| 483,872
|
|
| 615,378
|
Increase/(decrease) from accruals and deferred income
|
|
| -
|
|
| -
|
Other decreases/(other increases) in net working capital
|
|
| 1,693,985
|
|
| (4,612,428)
|
Total changes to net working capital
|
|
| 2,917,187
|
|
| (15,021,423)
|
3) Cash flow after changes to net working capital
|
|
| 3,661,642
|
|
| (11,944,255)
|
Other adjustments
|
|
|
|
|
|
|
Interest received/(paid)
|
|
| (46)
|
|
| (1,331,192)
|
(Var of reserves)
|
|
|
|
|
|
|
Total other adjustments
|
|
| (46)
|
|
| (1,331,192)
|
Cash flow from current activities (A)
|
|
| 3,661,596
|
|
| (13,275,447)
|
B) Cash flows from investments
|
|
|
|
|
|
|
Tangible fixed assets
|
|
|
|
|
|
|
(Investments)
|
|
| 10,233
|
|
| 10,234
|
Intangible fixed assets
|
|
|
|
|
|
|
(Investments)
|
|
| -
|
|
| (75,000)
|
Financial fixed assets
|
|
|
|
|
|
|
(Investments)
|
|
| -
|
|
| -
|
Cash flows from investments (B)
|
|
| 10,233
|
|
| (64,766)
|
C) Cash flows from financing activities
|
|
|
|
|
|
|
Loan capital
|
|
|
|
|
|
|
New loans
|
|
| (2,018,761)
|
|
| 14,260,574
|
Equity
|
|
|
|
|
|
|
Capital increase payments
|
|
| -
|
|
| -
|
Cash flows from financing activities (C)
|
|
|
|
|
| 14,260,574
|
Increase (decrease) in liquid assets (A ± B ± C)
|
|
| 1,653,068
|
|
| 920,360
|
Liquid assets at the end of the year
|
|
|
|
|
|
|
Bank and post office deposits
|
|
| 79,922
|
|
| 918,215
|
Cash and valuables in hand
|
|
| 2,145
|
|
| 2,145
|
Total liquid assets at the end of the year
|
|
| 82,067
|
|
| 920,360
|
The accompanying notes are an integral part of these unaudited financial statements.
F-56
MEXEDIA DESIGNATED ACTIVITY COMPANY
NOTES TO THE UNAUDITED FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED JUNE 30, 2024
1Accounting policies
Company information
Mexedia Designated Activity Company is a limited company domiciled and incorporated in the Republic of Ireland. The registered office is 17 Clanwilliam Square, Grand Canal Quay, Dublin 2 and its company registration number is 601653.
1.1 Accounting convention
The financial statements are prepared in dollars; the functional currency of the company is euros. Monetary amounts in these financial statements are rounded to the nearest dollar.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
1.2 Going concern
At the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
1.3 Turnover
Turnover is recognized at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.
1.4 Intangible fixed assets other than goodwill
Intangible assets acquired separately from a business are recognized at cost and are subsequently measured at cost less accumulated amortization and accumulated impairment losses.
Intangible assets acquired on business combinations are recognized separately from goodwill at the acquisition date where it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity and the fair value of the asset can be measured reliably; the intangible asset arises from contractual or other legal rights; and the intangible asset is separable from the entity.
Amortization is recognized so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Software
| Over 15 years
|
Development costs
| Over 8 years
|
1.5 Tangible fixed assets
Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognized so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Leasehold land and buildings
| 8 years
|
Fixtures and fittings
| 8 years
|
Computers
| 8 years
|
F-57
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.
1.6 Impairment of fixed assets
Assets not measured at fair value are reviewed for any indication that the asset may be impaired at each statement of financial position date. If such indication exists, the recoverable amount of the asset, or the asset’s cash generating unit, is estimated and compared to the carrying amount. Where the carrying amount exceeds its recoverable amount, an impairment loss is recognized in profit or loss unless the asset is carried at a revalued amount where the impairment loss is a revaluation decrease.
1.7 Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
1.8 Financial instruments
Financial instruments are recognized in the company's statement of financial position when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognized amounts and there is an intention to settle on a net basis or to realize the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortized cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest.
Classification of financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
Basic financial liabilities
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognized at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest.
1.9 Equity instruments
Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognized as liabilities once they are no longer at the discretion of the company.
1.10 Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the income statement because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax
Deferred tax liabilities are generally recognized for all timing differences and deferred tax assets are recognized to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognized if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
F-58
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realized. Deferred tax is charged or credited in the income statement, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
1.11 Employee benefits
The costs of short-term employee benefits are recognized as a liability and an expense, unless those costs are required to be recognized as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognized in the period in which the employee’s services are received.
Termination benefits are recognized immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
1.12 Foreign exchange
Transactions in currencies other than euros are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.
2Judgements and key sources of estimation uncertainty
In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
Critical judgements
The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognized in the financial statements.
Going Concern
The directors have prepared budgets and cash flows for a period of at least twelve months from the date of the approval of the financial statements which demonstrate that there is no material uncertainty regarding the company’s ability to meet its liabilities as they fall due, and to continue as a going concern. On this basis the directors consider it appropriate to prepare the financial statements on a going concern basis. Accordingly, these financial statements do not include any adjustments to the carrying amounts and classification of assets and liabilities that may arise if the company was unable to continue as a going concern.
Useful lives of Tangible Fixed Assets
Long-lived assets comprising primarily of property, plant and machinery and fixtures and fittings represent a significant portion of total assets. The annual depreciation charge depends primarily on the estimated lives of each type of asset and, in certain circumstances, estimates of residual values. The directors regularly review these useful lives and change them if necessary to reflect current conditions. In determining these useful lives management consider technological change, patterns of consumption, physical condition and expected economic utilization of the assets. Changes in the useful lives can have a significant impact on the depreciation charge for the financial year.
F-59
3Interest payable and similar expenses
| Six Months Ended June 30,
|
| 2024
|
| 2023
|
|
|
|
|
|
|
Finance interest
| $
| 2,516,418
|
| $
| 1,977,970
|
Other interest
|
| 4,735
|
|
| 15,903
|
| $
| 2,521,153
|
| $
| 1,993,872
|
4Debtors
| June 30, 2024
|
| June 30, 2023
|
Amounts falling due with one year:
|
|
|
|
|
|
|
|
|
|
|
|
Trade debtors
| $
| 42,991,609
|
| $
| 40,040,852
|
Corporation tax recoverable
|
| 2,155,259
|
|
| 455,408
|
Amounts owed by group undertakings
|
| 13,035,264
|
|
| 10,799,952
|
Other debtors
|
| 13,486,351
|
|
| 1,406,286
|
Prepayments
|
| 682,925
|
|
| 2,867,501
|
| $
| 72,351,408
|
| $
| 55,569,999
|
5Creditors: amounts falling due within one year
| June 30, 2024
|
| June 30, 2023
|
|
|
|
|
|
|
Trade creditors
| $
| 8,532,680
|
| $
| 3,088,035
|
Amounts owed to group undertakings
|
| 16,304
|
|
| 16,129
|
Corporation tax
|
| 0
|
|
| 0
|
VAT
|
| 2,628,310
|
|
| 0
|
PAYE and social security
|
| 4,758
|
|
| 3,134
|
Other creditors
|
| 48,149,823
|
|
| 45,259,245
|
Accruals
|
| 0
|
|
| 0
|
| $
| 59,331,877
|
| $
| 48,366,544
|
6Related party transactions
Included in debtors are various balances owed to Mexedia DAC from connected parties, these may be summarized as follows:
Amounts due:
Heritage Ventures Limited (common director) – At 6/30/24: $3,949,855
Mexedia Inc (group company) - At 6/30/24: $5,702,588
Amounts owed:
Heritage Ventures Limited (common director) shares - At 6/30/24: $16,304
Heritage Ventures Limited (common director) security deposit - At 6/30/24: $3,260
Mexedia Spa (group company) - At 6/30/24: $5,091,840
7Subsequent events
In October 2024, the company was acquired by Raadr, Inc., a U.S. publicly-traded corporation.
F-60
MEXEDIA DESIGNATED ACTIVITY COMPANY
UNAUDITED STATEMENT OF FINANCIAL POSITION
AS AT DECEMBER 31, 2023
| Notes
|
| 2023
|
| 2022
|
|
|
|
|
|
|
|
|
Fixes assets
|
|
|
|
|
|
|
|
Intangible assets
| 9
|
| $
| 1,712,500
|
| $
| 1,827,083
|
Tangible assets
| 10
|
|
| 67,275
|
|
| 79,249
|
|
|
|
| 1,779,775
|
|
| 1,906,332
|
|
|
|
|
|
|
|
|
Current assets
|
|
|
|
|
|
|
|
Debtors
| 11
|
|
| 54,722,747
|
|
| 38,028,150
|
Cash at bank and in hand
|
|
|
| 68,040
|
|
| 2,307,680
|
|
|
|
| 54,790,787
|
|
| 40,335,830
|
|
|
|
|
|
|
|
|
Creditors: amounts falling due within one year
| 12
|
|
| (53,137,607)
|
|
| (34,977,194)
|
|
|
|
|
|
|
|
|
Net current assets
|
|
|
| 1,653,180
|
|
| 5,358,636
|
|
|
|
|
|
|
|
|
Net assets
|
|
| $
| 3,432,955
|
| $
| 7,264,968
|
|
|
|
|
|
|
|
|
Capital and reserves
|
|
|
|
|
|
|
|
Called up share capital presented as equity
| 13
|
| $
| 1,000
|
| $
| 1,000
|
Revaluation reserve
| 14
|
|
| 2,000,000
|
|
| 2,000,000
|
Profit and loss reserves
| 15
|
|
| 1,431,955
|
|
| 5,263,968
|
|
|
|
|
|
|
|
|
Total equity
|
|
| $
| 3,432,955
|
| $
| 7,264,968
|
The accompanying notes are an integral part of these unaudited financial statements.
F-61
MEXEDIA DESIGNATED ACTIVITY COMPANY
UNAUDITED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED DECEMBER 31, 2023
The income statement has been prepared on the basis that all operations are continuing operations.
| Notes
|
| 2023
|
| 2022
|
|
|
|
|
|
|
|
|
Turnover
|
|
| $
| 112,626,233
|
| $
| 140,871,413
|
Cost of sales
|
|
|
| (102,949,336)
|
|
| (127,696,740)
|
|
|
|
|
|
|
|
|
Gross profit
|
|
|
| 9,676,897
|
|
| 13,714,673
|
|
|
|
|
|
|
|
|
Administrative expenses
|
|
|
| (3,823,761)
|
|
| (4,107,763)
|
Other operating income/(expenses)
|
|
|
| 170,798
|
|
| (2,982)
|
|
|
|
|
|
|
|
|
Operating profit
| 3
|
|
| 6,023,934
|
|
| 9,063,928
|
|
|
|
|
|
|
|
|
Interest payable and similar expenses
| 6
|
|
| (4,402,570)
|
|
| (3,042,846)
|
|
|
|
|
|
|
|
|
Profit before taxation
|
|
|
| 1,621,364
|
|
| 6,021,082
|
|
|
|
|
|
| $
|
|
Tax on profit
| 7
|
|
| (190,055)
|
|
| (757,759)
|
|
|
|
|
|
|
|
|
Profit for the financial year
|
|
| $
| 1,431,309
|
| $
| 5,263,323
|
The accompanying notes are an integral part of these unaudited financial statements.
F-62
MEXEDIA DESIGNATED ACTIVITY COMPANY
UNAUDITED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED DECEMBER 31, 2023
| Notes
|
| Share
Capital
|
| Revaluation
Reserve
|
| Profit and
Loss Reserves
|
| Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at 1 January 2022
|
|
| $
| 1,000
|
| $
| 2,000,000
|
| $
| 2,915,946
|
| $
| 4,916,946
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended 31 December 2022:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit and total comprehensive income
|
|
|
| -
|
|
| -
|
|
| 5,263,323
|
|
| 5,263,323
|
Dividends
| 8
|
|
| -
|
|
| -
|
|
| (2,915,301)
|
|
| (2,915,301)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at 31 December 2022
|
|
|
| 1,000
|
|
| 2,000,000
|
|
| 5,263,968
|
|
| 7,264,968
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended 31 December 2023:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit and total comprehensive income
|
|
|
| -
|
|
| -
|
|
| 1,431,309
|
|
| 1,431,309
|
Dividends
| 8
|
|
| -
|
|
| -
|
|
| (5,263,322)
|
|
| (5,263,322)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at 31 December 2023
|
|
| $
| 1,000
|
| $
| 2,000,000
|
| $
| 11,431,955
|
| $
| 3,432,955
|
The accompanying notes are an integral part of these unaudited financial statements.
F-63
MEXEDIA DESIGNATED ACTIVITY COMPANY
UNAUDITED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED DECEMBER 31, 2023
| Notes
|
| 2023
|
| 2022
|
|
|
|
|
|
|
|
|
Cash flows from operating activities
|
|
|
|
|
|
|
|
Cash generated from operations
| 19
|
| $
| 8,474,652
|
| $
| 3,121,505
|
Interest paid
|
|
|
| (4,402,570)
|
|
| (3,042,846)
|
Income taxes paid
|
|
|
| (1,010,900)
|
|
| (284,109)
|
|
|
|
|
|
|
|
|
Net cash inflow/(outflow) from operating activities
|
|
|
| 3,061,182
|
|
| (205,450)
|
|
|
|
|
|
|
|
|
Investing activities
|
|
|
|
|
|
|
|
Purchase of intangible assets
|
|
|
| (37,500)
|
|
| (37,500)
|
Purchase of tangible fixed assets
|
|
|
| -
|
|
| (991)
|
Proceeds from disposal of subsidiaries
|
|
|
| -
|
|
| 85
|
|
|
|
|
|
|
|
|
Net cash used in investing activities
|
|
|
| (37,500)
|
|
| 5,358,636
|
|
|
|
|
|
|
|
|
Financing activities
|
|
|
|
|
|
|
|
Dividends paid
|
|
|
| (5,263,322)
|
|
| (2,915,301)
|
|
|
|
|
|
|
|
|
Net cash used in financing activities
|
|
|
| (5,263,322)
|
|
| (2,915,301)
|
|
|
|
|
|
|
|
|
Net decrease in cash and cash equivalents
|
|
|
| (2,239,640)
|
|
| (3,159,157)
|
|
|
|
|
|
|
|
|
Cash and cash equivalents at beginning of year
|
|
|
| 2,307,680
|
|
| 5,466,837
|
|
|
|
|
|
|
|
|
Cash and cash equivalents at end of year
|
|
| $
| 68,040
|
| $
| 2,307,680
|
The accompanying notes are an integral part of these unaudited financial statements.
F-64
MEXEDIA DESIGNATED ACTIVITY COMPANY
NOTES TO THE UNAUDITED FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2023
1Accounting policies
Company information
Mexedia Designated Activity Company is a limited company domiciled and incorporated in the Republic of Ireland. The registered office is 17 Clanwilliam Square, Grand Canal Quay, Dublin 2 and its company registration number is 601653.
1.1 Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2014.
The financial statements are prepared in euros, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest dollar.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
1.2 Going concern
At the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
1.3 Turnover
Turnover is recognized at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.
1.4 Intangible fixed assets other than goodwill
Intangible assets acquired separately from a business are recognized at cost and are subsequently measured at cost less accumulated amortization and accumulated impairment losses.
Intangible assets acquired on business combinations are recognized separately from goodwill at the acquisition date where it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity and the fair value of the asset can be measured reliably; the intangible asset arises from contractual or other legal rights; and the intangible asset is separable from the entity.
Amortization is recognized so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Software
| Over 15 years
|
Development costs
| Over 8 years
|
1.5 Tangible fixed assets
Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognized so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Leasehold land and buildings
| 8 years
|
Fixtures and fittings
| 8 years
|
Computers
| 8 years
|
F-65
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.
1.6 Impairment of fixed assets
Assets not measured at fair value are reviewed for any indication that the asset may be impaired at each statement of financial position date. If such indication exists, the recoverable amount of the asset, or the asset’s cash generating unit, is estimated and compared to the carrying amount. Where the carrying amount exceeds its recoverable amount, an impairment loss is recognized in profit or loss unless the asset is carried at a revalued amount where the impairment loss is a revaluation decrease.
1.7 Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
1.8 Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognized in the company’s statement of financial position when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognized amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortized cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest.
Classification of financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
Basic financial liabilities
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognized at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest.
1.9 Equity instruments
Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognized as liabilities once they are no longer at the discretion of the company.
1.10 Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the income statement because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax
Deferred tax liabilities are generally recognized for all timing differences and deferred tax assets are recognized to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognized if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
F-66
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realized. Deferred tax is charged or credited in the income statement, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
1.11 Employee benefits
The costs of short-term employee benefits are recognized as a liability and an expense, unless those costs are required to be recognized as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognized in the period in which the employee’s services are received.
Termination benefits are recognized immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
1.12 Foreign exchange
Transactions in currencies other than euros are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.
2Judgements and key sources of estimation uncertainty
In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
Critical judgements
The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognized in the financial statements.
Going Concern
The directors have prepared budgets and cash flows for a period of at least twelve months from the date of the approval of the financial statements which demonstrate that there is no material uncertainty regarding the company’s ability to meet its liabilities as they fall due, and to continue as a going concern. On this basis the directors consider it appropriate to prepare the financial statements on a going concern basis. Accordingly, these financial statements do not include any adjustments to the carrying amounts and classification of assets and liabilities that may arise if the company was unable to continue as a going concern.
Useful lives of Tangible Fixed Assets
Long-lived assets comprising primarily of property, plant and machinery and fixtures and fittings represent a significant portion of total assets. The annual depreciation charge depends primarily on the estimated lives of each type of asset and, in certain circumstances, estimates of residual values. The directors regularly review these useful lives and change them if necessary to reflect current conditions. In determining these useful lives management consider technological change, patterns of consumption, physical condition and expected economic utilization of the assets. Changes in the useful lives can have a significant impact on the depreciation charge for the financial year.
F-67
3Operating profit
| 2023
|
| 2022
|
Operating profit for the year is stated after charging:
|
|
|
|
|
|
|
|
|
|
|
|
Exchange losses
| $
| 11,768
|
| $
| 82,310
|
Fees payable to the company’s auditor for the audit of the company’s financial statements
|
| 22,765
|
|
| 19,950
|
Depreciation of owned tangible fixed assets
|
| 11,974
|
|
| 11,965
|
Amortization of intangible assets
| $
| 152,083
|
| $
| 152,084
|
4Employees
The average monthly number of persons (including directors) employed by the company during the year was:
| 2023
Number
|
| 2022
Number
|
|
|
|
|
|
|
Directors
|
| 1
|
|
| 1
|
Other
|
| 2
|
|
| 2
|
Total
|
| 3
|
|
| 3
|
Their aggregate remuneration comprised:
| 2023
|
| 2022
|
|
|
|
|
|
|
Wages and salaries
| $
| 145,691
|
| $
| 160,851
|
Social security costs
|
| 26,943
|
|
| 18,352
|
| $
| 172,634
|
| $
| 179,203
|
5Directors’ Remuneration
| 2023
|
| 2022
|
|
|
|
|
|
|
Remuneration for qualifying services
| $
| 77,000
|
| $
| 77,000
|
6Interest payable and similar expenses
| 2023
|
| 2022
|
|
|
|
|
|
|
Finance interest
| $
| 4,373,361
|
| $
| 3,004,658
|
Other interest
|
| 29,209
|
|
| 38,188
|
| $
| 4,402,570
|
| $
| 3,042,846
|
F-68
7Taxation
| 2023
|
| 2022
|
Current tax
|
|
|
|
|
|
Corporation tax on profits for the current period
| $
| 190,055
|
| $
| 757,759
|
| 2023
|
| 2022
|
|
|
|
|
|
|
Profit before taxation
| $
| 1,621,364
|
| $
| 6,021,082
|
|
|
|
|
|
|
Expected tax charge based on standard rate of corporation tax of 12.50% (2022: 12.50%)
| $
| 202,671
|
| $
| 752,635
|
Tax effect of expenses that are not deductible in determining taxable profit
|
| 3,651
|
|
| 18,899
|
Tax effect of income not taxable in determining taxable profit
|
| (75)
|
|
| (75)
|
Permanent capital allowances in excess of depreciation
|
| (36,255)
|
|
| (35,669)
|
Depreciation on assets not qualifying for tax allowances
|
| 3,565
|
|
| 1,496
|
Amortization on assets not qualifying for tax allowances
|
| 19,010
|
|
| 19,011
|
Other non-reversing timing differences
|
| -
|
|
| 1,462
|
|
|
|
|
|
|
Taxation charge for the year
| $
| 192,567
|
| $
| 757,759
|
|
|
|
|
|
|
Taxation charge in the financial statements
| $
| 190,055
|
| $
| 757,759
|
|
|
|
|
|
|
Reconciliation - the current year tax charge does not reconcile to the above analysis. Please review figures in the database.
| $
| 2,512
|
| $
| -
|
8Dividends
| 2023
|
| 2022
|
|
|
|
|
|
|
Final paid/outstanding
| $
| 5,263,322
|
| $
| 2,915,301
|
9Intangible fixed assets
| Software
|
| Development
Costs
|
| Total
|
|
|
|
|
|
|
|
|
|
Cost
|
|
|
|
|
|
|
|
|
At 1 January 2023
| $
| 2,000,000
|
| $
| 187,500
|
| $
| 2,187,500
|
Additions - internally developed
|
| -
|
|
| 37,500
|
|
| 37,500
|
|
|
|
|
|
|
|
|
|
At 31 December 2023
|
| 2,000,000
|
|
| 225,000
|
|
| 2,225,000
|
|
|
|
|
|
|
|
|
|
Amortization and impairment
|
|
|
|
|
|
|
|
|
At 1 January 2023
|
| 266,667
|
|
| 93,750
|
|
| 360,417
|
Amortization charged for the year
|
| 133,333
|
|
| 18,750
|
|
| 152,083
|
|
|
|
|
|
|
|
|
|
At 31 December 2023
|
| 400,000
|
|
| 112,500
|
|
| 512,500
|
|
|
|
|
|
|
|
|
|
Carrying amount
|
|
|
|
|
|
|
|
|
At 31 December 2023
|
| 1,600,000
|
|
| 112,500
|
|
| 1,712,500
|
|
|
|
|
|
|
|
|
|
At 31 December 2022
| $
| 1,733,333
|
| $
| 93,750
|
| $
| 1,827,083
|
F-69
10Tangible fixed assets
| Leasehold
land and
buildings
|
| Fixtures and
fittings
|
| Computers
|
| Total
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost
|
|
|
|
|
|
|
|
|
|
|
|
At 1 January 2023 and 31 December 2023
| $
| 13,925
|
| $
| 75,948
|
| $
| 5,921
|
| $
| 95,794
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation
|
|
|
|
|
|
|
|
|
|
|
|
At 1 January 2023
|
| 2,573
|
|
| 13,023
|
|
| 949
|
|
| 16,545
|
Depreciation charged in the year
|
| 1,741
|
|
| 9,493
|
|
| 740
|
|
| 11,974
|
|
|
|
|
|
|
|
|
|
|
|
|
at 31 December 2023
|
| 4,314
|
|
| 22,516
|
|
| 1,689
|
|
| 28,519
|
|
|
|
|
|
|
|
|
|
|
|
|
Carrying amount
|
|
|
|
|
|
|
|
|
|
|
|
At 31 December 2023
|
| 9,611
|
|
| 53,432
|
|
| 4,232
|
|
| 67,275
|
|
|
|
|
|
|
|
|
|
|
|
|
At 31 December 2022
| $
| 11,352
|
| $
| 6,295
|
| $
| 4,972
|
| $
| 79,249
|
11Debtors
| 2023
|
| 2022
|
Amounts falling due with one year:
|
|
|
|
|
|
|
|
|
|
|
|
Trade debtors
| $
| 40,654,524
|
| $
| 28,587,750
|
Corporation tax recoverable
|
| 159,572
|
|
| -
|
Amounts owed by group undertakings
|
| 9,212,143
|
|
| 4,871,520
|
Other debtors
|
| 3,674,842
|
|
| 4,020,446
|
Prepayments
|
| 1,021,666
|
|
| 548,434
|
| $
| 54,722,747
|
| $
| 38,028,150
|
Amounts receivable from group companies are unsecured, interest-free, have no fixed date of repayment and are repayable on demand.
12Creditors: amounts falling due within one year
| 2023
|
| 2022
|
|
|
|
|
|
|
Trade creditors
| $
| 7,488,256
|
| $
| 3,897,599
|
Amounts owed to group undertakings
|
| 3,682,134
|
|
| 1,233,301
|
Corporation tax
|
| -
|
|
| 661,273
|
VAT
|
| -
|
|
| 22,568
|
PAYE and social security
|
| 8,374
|
|
| 12,119
|
Other creditors
|
| 41,891,469
|
|
| 29,150,424
|
Accruals
|
| 67,374
|
|
| (90)
|
| $
| 53,137,607
|
| $
| 34,977,194
|
Amounts owed to group companies are unsecured, interest-free, have no fixed date of repayment and are repayable on demand.
Other creditors: Included in other creditors are loan balances which have been advanced to the company by Lenderwize Limited. The total outstanding at the year end to Lenderwize Limited was $41,791,319 (2022 - $29,048,069). Interest charged by Lenderwize Limited in the current year was $4,373,334 (2022 - $3,000,863).
F-70
13Share capital
| 2023
Number
|
| 2022
Number
|
| 2023
|
| 2022
|
Ordinary share capital Authorized equity
Issued and fully paid
|
|
|
|
|
|
|
|
|
|
|
|
Ordinary shares of $1 each
|
| 1,000
|
|
| 1,000
|
| $
| 1,000
|
| $
| 1,000
|
14Revaluation reserve
| 2023
|
| 2022
|
|
|
|
|
|
|
At the beginning and end of the year
| $
| 2,000,000
|
| $
| 2,000,000
|
15Profit and loss reserves
| 2023
|
| 2022
|
|
|
|
|
|
|
At the beginning of the year
| $
| 5,263,968
|
| $
| 2,915,946
|
Profit for the year
|
| 1,431,309
|
|
| 5,263,323
|
Dividends declared and paid in the year/outstanding at year end
|
| (5,263,322)
|
|
| (2,915,301)
|
| $
| 1,431,955
|
| $
| 5,263,968
|
16Events after the reporting date
There are no post balance sheet adjustments which require disclosure.
17Related party transactions
Included in debtors are various balances owed to Mexedia DAC from connected parties, these may be summarized as follows:
Amounts due:
Heritage Ventures Limited (common director) - $4,039,855 (2022: $2,027,855)
Mexedia Inc (group company) - $5,172,288 (2022: $2,843,665)
Amounts owed:
Heritage Ventures Limited (common director) shares - $15,000 (2022: $15,000)
Heritage Ventures Limited (common director) security deposit - $3,000 (2022: $3,000)
Mexedia Spa (group company) - $3,644,134 (2022: $1,215,301)
Trade debtor intercompany balances:
Mexedia Inc (group company) - $558,002 (2022: $206,377)
Mexedia Spa (group company) - $12,492 (2022: $Nil)
Opt1mize Technologies Limited (common control) - $591,826 (2022: $584,763)
18Ultimate controlling party
Mexedia Limited is a wholly owned subsidiary of Mexedia SPA S.B, an Italian company. The majority shareholder in Mexedia SPA S.B, via a holding company structure, is Mr Orlando Taddeo who may be regarded as the ultimate controlling party of Mexedia Limited.
F-71
19Cash generated from operations
| 2023
|
| 2022
|
|
|
|
|
|
|
Profit for the year after tax
| $
| 1,431,309
|
| $
| 5,263,323
|
|
|
|
|
|
|
Adjustments for:
|
|
|
|
|
|
Taxation charged
|
| 190,055
|
|
| 757,759
|
Finance costs
|
| 4,402,570
|
|
| 3,042,846
|
Amortization and impairment of intangible assets
|
| 152,083
|
|
| 152,084
|
Depreciation and impairment of tangible fixed assets
|
| 11,974
|
|
| 11,965
|
|
|
|
|
|
|
Movements in working capital:
|
|
|
|
|
|
Increase in debtors
|
| (16,535,025)
|
|
| (13,733,710)
|
Increase in creditors
|
| 18,821,686
|
|
| 7,627,238
|
|
|
|
|
|
|
Cash generated from operations
| $
| 8,474,652
|
| $
| 3,121,505
|
20Analysis of changes in net funds
| 1 January
2023
|
| Cash flows
|
| 31 December
2023
|
|
|
|
|
|
|
|
|
|
Cash at bank and in hand
| $
| 2,307,680
|
| $
| (2,239,640)
|
| $
| 68,040
|
21Approval of financial statements
The directors approved the financial statements on 11 March 2024.
F-72
PART III EXHIBITS
Exhibit No.
| Description of Exhibit
|
|
|
2. Charter and Bylaws
|
2.1*
| Articles of Incorporation
|
2.2*
| Certificate of Change (Increase Authorized) dated June 19, 2018
|
2.3*
| Certificate of Designation (Creation of Series A Preferred) dated January 3, 2013
|
2.4*
| Certificate of Amendment (Name Change to Pitooey!, Inc.) dated January 18, 2013
|
2.5*
| Certificate of Amendment (Name Change to Raadr, Inc.) dated June 29, 2015
|
2.6*
| Certificate of Designation (Creation of Series E Preferred) dated January 27, 2016
|
2.7*
| Certificate of Amendment (Increase in Authorized) dated March 21, 2016
|
2.8*
| Certificate of Amendment (Increase in Authorized) dated May 9, 2016
|
2.9*
| Certificate of Amendment (Increase in Authorized) dated May 3, 2017
|
2.10*
| Certificate of Amendment (Increase in Authorized) dated August 4, 2017
|
2.10.1*
| Certificate of Amendment (Increase in Authorized) dated May 6, 2022
|
2.10.2*
| Certificate of Amendment (Reverse Split: 1-for-1,000) dated August 31, 2022
|
2.10.3*
| Certificate of Amendment (Reverse Split: 1-for-100) dated September 28, 2022
|
2.10.4+
| Certificate of Amendment (Increase in Authorized) dated December 1, 2022
|
2.10.5+
| Certificate of Designation (Creation of Series F Preferred) dated October 8, 2024
|
2.11*
| Bylaws
|
|
|
3. Instruments Defining the Rights of Securityholders
|
3.1*
| Promissory Note issued by the Company to JanBella Group, LLC and Guaranty between JanBella Group, LLC and Jacob DiMartino
|
3.2+
| Secured Promissory Note dated October 8, 2024, principal amount $540,000.00, in favor of JanBella Group, LLC
|
3.3+
| Convertible Promissory Note dated November 15, 2024, $50,000 principal amount, issued in favor of Daniel Contreras
|
3.4+
| Convertible Promissory Note dated November 15, 2024, $300,000 principal amount, issued in favor of Orlando Taddeo
|
3.5+
| Convertible Promissory Note dated November 15, 2024, $200,000 principal amount, issued in favor of Daniel Gilcher
|
3.6+
| Convertible Promissory Note dated November 15, 2024, $300,000 principal amount, issued in favor of Orlando Taddeo
|
3.7+
| Convertible Promissory Note dated November 15, 2024, $200,000 principal amount, issued in favor of Daniel Gilcher
|
3.8+
| Convertible Promissory Note dated July 15, 2024, $60,000 principal amount, issued in favor of Newlan Law Firm, PLLC
|
3.9+
| Convertible Promissory Note dated July 15, 2024, $40,000 principal amount, issued in favor of Newlan Law Firm, PLLC
|
3.10+
| Amendment No. 1 to the Promissory Note dated November 18, 2022, in favor of Boot Capital, LLC
|
3.11+
| Second Amendment to Senior Secured Convertible Promissory Note dated July 29, 2021, in favor of Leonite Fund I, LP
|
3.12+
| Convertible Promissory Note dated October 1, 2024, $25,000 principal amount, issued in favor of FirstFire Global Opportunity Fund, LLC
|
|
|
4. Subscription Agreement
|
4.1+
| Form of Subscription Agreement
|
II-1
Exhibit No.
| Description of Exhibit
|
|
|
6. Material Agreements
|
6.1*
| Forbearance Agreement between the Company and Dean Richards
|
6.2*
| Forbearance Agreement between the Company and Tina Upham
|
6.3*
| Forbearance Agreement between the Company and Brenda Whitman
|
6.4+
| Stock Cancellation Agreement between the Company and Dean Richards
|
6.5+
| Stock Cancellation Agreement between the Company and Tina Upham
|
6.6+
| Stock Cancellation Agreement between the Company and Brenda Whitman
|
6.7+
| Redemption Agreement between the Company and JanBella Group, LLC
|
6.8+
| Pledge Agreement between Mexedia S.p.A. S.B. and JanBella Group, LLC
|
6.9+
| Guaranty of Mexedia S.p.A. S.B.
|
6.10+
| Settlement Agreement between the Company and FirstFire Global Opportunities Fund, LLC
|
6.11+
| Settlement Agreement between the Company and FirstFire Global Opportunities Fund, LLC
|
6.12+
| Global Settlement Agreement between the Company and Leonite Fund I, LP
|
6.13+
| Global Settlement Agreement between the Company and IBH Capital, LLC
|
6.14+
| Settlement Agreement between the Company and GW Holdings Group, LLC
|
6.15+
| Legal Services Agreement between the Company and Newlan Law Firm, PLLC
|
6.16+
| Facility Agreement among Mexedia, DAC, Matchcom Telecommunication Inc. and Phonetime Inc., as Borrowers/Obligors, and Fasanara Securitisation S.A., Acting for and on Behalf of its Compartment H, as Lender
|
6.17+
| Settlement Agreement between the Company and Boot Capital, LLC
|
|
|
7. Plan of acquisition, reorganization, arrangement, liquidation or succession
|
7.1+
| Share Exchange Agreement among the Company, Mexedia, Inc. and Mexedia S.p.A. S.B.
|
7.1.1+
| Amendment No. 1 to Share Exchange Agreement among the Company, Mexedia, Inc. and Mexedia S.p.A. S.B.
|
7.2+
| Share Exchange Agreement among the Company, Mexedia DAC and Mexedia S.p.A. S.B.
|
7.2.1+
| Amendment No. 1 to Share Exchange Agreement among the Company, Mexedia, DAC and Mexedia S.p.A. S.B.
|
|
|
11. Consents
|
11.1+
| Consent of Newlan Law Firm, PLLC (see Exhibit 12.1)
|
|
|
|
|
12. Opinion re: Legality
|
12.1+
| Opinion of Newlan Law Firm, PLLC
|
__________________________
+ Filed herewith.
* Incorporated by reference as indicated.
II-2
SIGNATURES
Pursuant to the requirements of Regulation A, the issuer certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form 1-A and has duly caused this offering statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Miami Beach, State of Florida, on November 29, 2024.
| RAADR, INC.
|
|
|
| By:
| /s/ Daniel Contreras
|
|
| Daniel Contreras
|
|
| Chief Executive Officer
|
This Offering Statement has been signed by the following persons in the capacities and on the dates indicated.
/s/ Daniel Contreras
|
|
|
Daniel Contreras
|
| November 29, 2024
|
Chief Executive Officer (Principal
|
|
|
Executive Officer) and Director
|
|
|
/s/ Orlando Taddeo
|
|
|
Orlando Taddeo
|
| November 29, 2024
|
President and Director
|
|
|
/s/ Daniel Gilcher
|
|
|
Daniel Gilcher
|
| November 29, 2024
|
Chief Financial Officer (Principal Accounting Officer),
|
|
|
Secretary, Treasurer and Director
|
|
|
II-3
48
| 15/10/2027
| 15/11/2027
| 15/11/2027
| 12,678,574.67
| 11,763,323.89
| 10.0%
| -109,176.62
| - 915,250.78
| -
| - 1,024,427.4
|
49
| 15/11/2027
| 15/12/2027
| 15/12/2027
| 11,763,323.89
| 10,787,056.39
| 10.0%
| - 98,027.70
| - 976,267.50
| -
| - 1,074,295.2
|
50
| 15/12/2027
| 15/01/2027
| 15/01/2027
| 10,787,056.39
| 9,810,788.89
| 10.0%
| - 92,888.54
| - 976,267.50
| -
| - 1,069,156.0
|
51
| 15/01/2027
| 15/02/2027
| 15/02/2027
| 9,810,788.89
| 8,834,521.39
| 10.0%
| - 84,481.79
| - 976,267.50
| -
| - 1,060,749.2
|
52
| 15/02/2027
| 15/03/2027
| 15/03/2027
| 8,834,521.39
| 7,858,253.89
| 10.0%
| - 68,712.94
| - 976,267.50
| -
| - 1,044,980.4
|
53
| 15/03/2027
| 15/04/2027
| 15/04/2027
| 7,858,253.89
| 6,881,986.39
| 10.0%
| - 67,668.30
| - 976,267.50
| -
| - 1,043,935.8
|
54
| 15/04/2027
| 15/05/2027
| 15/05/2027
| 6,881,986.39
| 5,905,718.89
| 10.0%
| - 57,349.89
| - 976,267.50
| -
| - 1,033,617.3
|
55
| 15/05/2027
| 15/06/2028
| 15/06/2028
| 5,905,718.89
| 4,929,451.39
| 10.0%
| - 50,854.80
| - 976,267.50
| -
| - 1,027,122.3
|
56
| 15/06/2028
| 15/07/2028
| 15/07/2028
| 4,929,451.39
| 3,953,183.89
| 10.0%
| - 41,078.76
| - 976,267.50
| -
| - 1,017,346.2
|
57
| 15/07/2028
| 15/08/2028
| 15/08/2028
| 3,953,183.89
| 2,976,916.39
| 10.0%
| - 34,041.31
| - 976,267.50
| -
| - 1,010,308.8
|
58
| 15/08/2028
| 15/09/2028
| 15/09/2028
| 2,976,916.39
| 2,000,648.89
| 10.0%
| - 25,634.56
| - 976,267.50
| -
| - 1,001,902.0
|
59
| 15/09/2028
| 15/10/2028
| 15/10/2028
| 2,000,648.89
| 1,024,381.39
| 10.0%
| -16,672.07
| -976,267.50
| -
| -992,939.57
|
60
| 15/10/2028
| 15/11/2028
| 15/11/2028
| 1,024,381.39
| -
| 10.0%
| 8,821.06
| -1,024,381.38
| -
| -1,033,202.4
|
- 49 -
SIGNATURES
THE BORROWER AND AN OBLIGOR
SIGNED by
MEXEDIA DAC acting by the following person(s) who, in accordance with the laws of its territory of incorporation, is/are acting under the actual authority of such party
)
)
)
)
)
)/s/ Orlando Taddeo
Orlando Taddeo, Director
AN OBLIGOR
SIGNED by
MATCHCOM TELECOMMUNICATION INC acting
by the following person(s) who, in accordance with the laws of its territory of incorporation, is/are acting under the actual authority of such party
)
)
)
)
)
)/s/ Orlando Taddeo
Orlando Taddeo, Director
AN OBLIGOR
SIGNED by
PHONETIME INC acting by the following person(s) who, in accordance with the laws of its territory of incorporation, is/are acting under the actual authority of such party
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)
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)/s/ Orlando Taddeo
Orlando Taddeo, Director
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THE LENDER
SIGNED by
FASANARA SECURITISATION S.A.,
acting in respect of its COMPARTMENT H acting by the following person(s) who, in accordance with the laws of its territory of incorporation, is/are acting under the actual authority of such party
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)
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/s/ Francesco Filia
Francesco Filia, Director
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SETTLEMENT AGREEMENT
This Settlement Agreement (this “Agreement”) is entered into as of November 22, 2024, by and between Raadr, Inc., a Nevada corporation (the “Company”), and Boot Capital, LLC (“Investor”, and, together with the Company, the “Parties”).
WHEREAS, the Company currently is indebted to Investor in the aggregate amount of 67,028.52 under a promissory note dated November 18, 2022, as amended as of October 8, 2024 (the “Note Amendment”), as more particularly described on Exhibit A attached hereto and made a part hereof (collectively, the “Company Obligations”), there being no other Company instruments held by Investor; and
WHEREAS, certain unspecified disputes (the “Unspecified Disputes”) may have arisen between the Parties in respect of the Company Obligations, the terms and conditions thereof, the payments that may be due and owning thereon, the number of shares to which Investor may have rights or the actions of the Company in connection therewith; and
WHEREAS, subject to the terms and conditions set forth herein, the Company and Investor desire to enter into a transaction to settle the Unspecified Disputes wherein the Company will issue to Investor a total of 450,000,000 shares of Company common stock (the “Settlement Shares”) on the terms and conditions herein.
NOW, THEREFORE, in consideration of the rights and benefits that they will each receive in connection with this Agreement, the Parties, intending to be legally bound, agree as follows:
1.Settlement. In exchange for the Company Obligations held by Investor, the Company shall issue and deliver the Settlement Shares to Investor, at the Closing (as defined below), pursuant to Section 3(a)(9) of the Securities Act of 1933, as amended (the “Securities Act”), and/or Section 4(a)(2) of the Securities Act.
2.Closing. On the Closing Date (as defined below), subject to the terms and conditions of this Agreement, the Company shall deliver (a) the Closing Shares and (b) the Reserve Letter, and Investor shall exchange the Company Obligations held by Investor therefor. Upon receipt of the Closing Shares, all of Investor’s rights under the Company Obligations shall be extinguished. The exchange described in the foregoing sentence shall take place remotely via electronic delivery of signatures and documents within one (1) day of the date hereof, or at such other time and place as the Company and Investor mutually agree (the “Closing” and such date the “Closing Date”).
SETTLEMENT AGREEMENT | PAGE 1
3.Leak-Out Agreement. The leak-out provisions contained in the Note Amendment shall survive so long as Investor shall hold any of the Settlement Shares issued pursuant to this Agreement.
4.Closing Conditions.
(a)Conditions to Investor’s Obligations. The obligation of Investor to consummate the Closing is subject to the fulfillment, to Investor’s reasonable satisfaction, prior to or at the Closing, of each of the following conditions:
(1)Representations and Warranties. The representations and warranties of the Company contained in this Agreement shall be true and correct in all material respects on the date hereof and on and as of the Closing Date as if made on and as of such date.
(2)No Actions. No action, proceeding, investigation, regulation or legislation shall have been instituted, threatened or proposed before any court, governmental agency or authority or legislative body to enjoin, restrain, prohibit or obtain substantial damages in respect of, this Agreement or the consummation of the transactions contemplated by this Agreement.
(3)Proceedings and Documents. All proceedings in connection with the transactions contemplated hereby and all documents and instruments incident to such transactions shall be satisfactory in substance and form to Investor, and Investor shall have received all such counterpart originals or certified or other copies of such documents as it may reasonably request.
(4)Issuance. The Company shall have issued to Investor the Settlement Shares.
(b)Conditions to the Company’s Obligations. The obligation of the Company to consummate the Closing is subject to the fulfillment, to the Company’s reasonable satisfaction, prior to or at the Closing, of each of the following conditions:
(1)Representations and Warranties. The representations and warranties of Investor contained in this Agreement shall be true and correct in all material respects on the date hereof and on and as of the Closing Date as if made on and as of such date.
(2) No Actions. No action, proceeding, investigation, regulation or legislation shall have been instituted, threatened or proposed before any court, governmental agency or authority or legislative body to enjoin, restrain, prohibit, or obtain substantial damages in respect of, this Agreement or the consummation of the transactions contemplated by this Agreement.
(3)Proceedings and Documents. All proceedings in connection with the transactions contemplated hereby and all documents and instruments incident to such
SETTLEMENT AGREEMENT | PAGE 2
transactions shall be satisfactory in substance and form to the Company and the Company shall have received all such counterpart originals or certified or other copies of such documents as the Company may reasonably request.
5.Representations and Warranties of the Company. The Company hereby represents and warrants to Investor as of the date hereof as follows:
(a)Organization and Standing. The Company is a corporation duly organized, validly existing and in good standing under the laws of Nevada. The Company has all requisite corporate power and authority to own and operate its properties and assets and to carry on its business as presently conducted. The Company is duly qualified and authorized to transact business and is in good standing as a foreign corporation in each jurisdiction in which the failure to so qualify would have a material adverse effect on its business, properties or financial condition.
(b)Corporate Power. The Company has all requisite legal and corporate power and authority to execute and deliver this Agreement, to issue the Settlement Shares hereunder, and to carry out and perform its obligations under the terms of this Agreement and the transactions contemplated hereby.
(c)Authorization. All corporate action on the part of the Company, its officers, directors and stockholders necessary for the authorization, execution, delivery and performance of this Agreement, the authorization, sale, issuance and delivery of the Settlement Shares and the performance of all of the Company’s obligations hereunder have been taken or will be taken prior to the Closing. This Agreement has been duly executed by the Company and constitutes valid and legally binding obligations of the Company, enforceable against the Company in accordance with their respective terms, subject to applicable law.
(d)Capitalization. As of the date of this Agreement, the authorized capital stock of the Company consists of: 15,000,000,000 shares of common stock, , par value $0.001 per share, of which 5,101,760,661 shares are issued and outstanding; and 100,000,000 shares of preferred stock, par value $0.001 per share, (1) 1,000,000 shares of which are designated Series E Preferred Stock and none of which shares are issued and outstanding and (2) 75,000 shares of which are designated Series F Preferred Stock and 75,000 shares of which are issued and outstanding. All of the Company’s issued and outstanding shares have been duly authorized, are validly issued, fully paid and non-assessable.
(e)Issuance of Settlement Shares. The issuance, sale and delivery of the Settlement Shares in accordance with this Agreement have been duly authorized by all necessary corporate action on the part of the Company. The Settlement Shares, when issued, sold and delivered in accordance with the terms and conditions of this Agreement, will be duly and validly issued, fully paid and non-assessable.
(f)Consents; Waivers. No consent, waiver, approval or authority of any nature, or other formal action, by any Person, not already obtained, is required in connection
SETTLEMENT AGREEMENT | PAGE 3
with the execution and delivery of this Agreement by the Company or the consummation by the Company of the transactions provided for herein and therein. As used herein, “Person” means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.
(g)Absence of Litigation. There is no action, suit, 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, threatened against or affecting the Company, the Settlement Shares or any of the Company’s officers or directors in their capacities as such.
(h)Validity; Enforcement; No Conflicts. This Agreement has been duly and validly authorized, executed and delivered on behalf of the Company and shall constitute the legal, valid and binding obligations of the Company enforceable against the Company in accordance with their respective terms, except as such enforceability may be limited by general principles of equity or to applicable bankruptcy, insolvency, reorganization, moratorium, liquidation and other similar laws relating to, or affecting generally, the enforcement of applicable creditors’ rights and remedies. The execution, delivery and performance by the Company of this Agreement and the consummation by the Company of the transactions contemplated hereby will not (1) result in a violation of the organizational documents of the Company, (2) conflict with, or constitute a default (or an event which with notice or lapse of time or both would become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, any agreement, indenture or instrument to which the Company is a party or by which it is bound, or (3) result in a violation of any law, rule, regulation, order, judgment or decree (including federal and state securities or “blue sky” laws) applicable to the Company, except in the case of clause (2) above, for such conflicts, defaults or rights which would not, individually or in the aggregate, reasonably be expected to have a material adverse effect on the ability of the Company to perform its obligations hereunder.
(i)Offering. Subject in part on the accuracy of Investor’s representations herein, the offer, sale and issuance of the Settlement Shares in conformity with the terms of this Agreement constitute transactions exempt from registration of under the Securities Act and from all applicable state securities laws. The sole consideration for the issuance of the Settlement Shares is Investor’s surrender of the Company Obligations.
6.Representations and Warranties of Investor. Investor hereby represents and warrants as of the date hereof to the Company as follows:
(a)Corporate Power. Investor has all requisite legal and corporate power and authority to execute and deliver this Agreement, and to carry out and perform its obligations under the terms of this Agreement and the transactions contemplated hereby.
(b)Authorization. All corporate action on the part of Investor, its officers, directors and stockholders necessary for the authorization, execution, delivery and performance
SETTLEMENT AGREEMENT | PAGE 4
of this Agreement and the performance of all of Investor’s obligations hereunder have been taken or will be taken prior to the Closing. This Agreement has been duly executed by Investor and constitutes valid and legally binding obligations of Investor, enforceable against Investor in accordance with their respective terms, subject to applicable law.
(c)Own Account. Investor is acquiring the Settlement Shares for its own account.
(d)Investment Purpose. As of the Closing, Investor is purchasing the Settlement Shares 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 Securities Act; provided, however, that by making the representations herein, Investor does not agree to hold any of such securities for any minimum or other specific term and reserves the right to dispose of such securities at any time in accordance with or pursuant to a registration statement or an exemption under the Securities Act.
(e)Accredited Investor Status. Investor is an “accredited investor” as that term is defined in Rule 501(a) of Regulation D (an “Accredited Investor”).
(f)Legends. Investor understands that until such time as the Settlement Shares have been registered under the Securities Act or may be sold pursuant to Rule 144, Rule 144A under the Securities Act, Regulation A, 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, such 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 [CONVERTIBLE/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 shares of common stock without such legend to the holder upon which it is stamped or (as requested by such holder) issue the applicable shares of common stock 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 Securities Act or otherwise may be sold pursuant to Rule 144, Rule 144A, Regulation A, 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 Investor provides the an opinion of counsel to the effect that a public sale
SETTLEMENT AGREEMENT | PAGE 5
or transfer of such security may be made without registration under the Securities 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. Investor agrees to sell all such securities, including those represented by a certificate(s) from which the legend has been removed, in compliance with applicable prospectus delivery requirements, if any.
(g)No Other Securities. Investor represents that the convertible promissory note comprising the Company Obligations is the only security of the Company owned by the Investor.
7.No Short Sales. Investor, its successors, assigns and affiliates, agrees that so long as the Settlement Shares are not sold, Investor and Investor’s affiliates shall not, directly or indirectly, enter into or effect “short sales” of the common stock of the Company or hedging transaction which establishes a short position with respect to the common stock of the Company. The Company acknowledges and agrees that upon delivery of a conversion notice by Investor, Investor immediately owns the shares of common stock described in the conversion notice and any sale of those shares issuable under such conversion notice would not be considered short sales.
8.Miscellaneous.
(a)Entire Agreement. This Agreement, together with the schedules and exhibits attached hereto, contain the entire understanding of the parties with respect to the subject matter hereof and supersede all prior agreements and understandings, oral or written with respect to such matters.
(b)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 (2) personally served, (2) deposited in the mail, registered or certified, return receipt requested, postage prepaid, (3) delivered by reputable air courier service with charges prepaid, or (4) transmitted by hand delivery or e-mail, addressed as set forth below or to such other address as such party shall have specified most recently by written notice.
Any notice or other communication required or permitted to be given hereunder shall be deemed effective (A) upon hand delivery or delivery by e-mail at the address or e-mail 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) or (B) on the second business day following the date of mailing by express courier service, fully prepaid, addressed to such address, or upon actual receipt of such mailing, whichever shall occur first. Such notice shall be properly delivered to the address set forth beneath the name of such party below:
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If to Investor:Boot Capital, LLC
1688 Meridian Avenue, Suite 723
Miami Beach, Florida 33139
Attention: Peter Rosten, President
E-mail: rost_nyc@yahoo.com
If to the Company:Raadr, Inc.
1680 Michigan Avenue, Suite 700
Miami Beach, Florida 33139
Attention: Daniel Gilcher, Chief Financial Officer
E-mail: dgilcher@mexedia.com
(c)Amendments; Waivers. No provision of this Agreement may be waived, modified, supplemented or amended except in a written instrument signed, in the case of an amendment, by the Company and Investor, in the case of a waiver, by the party against whom enforcement of any such waived provision is sought. No waiver with respect to any provision, condition or requirement of this Agreement shall be deemed to be a continuing waiver in the future or a waiver of any other provision, condition or requirement hereof, nor shall any delay or omission of any party to exercise any right hereunder in any manner impair the exercise of any such right.
(d)Headings. The headings herein are for convenience only, do not constitute a part of this Agreement and shall not be deemed to limit or affect any of the provisions hereof.
(e)Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their successors and permitted assigns.
(f)No Third-Party Beneficiaries. This Agreement is intended for the benefit of the parties hereto and their respective successors and assigns, and is not for the benefit of, nor may any provision hereof be enforced by, any other Person.
(g)Governing Law. All questions concerning the construction, validity, enforcement and interpretation of this Agreement shall be governed by and construed and enforced in accordance with the internal laws of the State of Nevada, without regard to the principles of conflict of laws thereof. Each party agrees that all legal proceedings concerning the interpretation, enforcement and defense of the transactions contemplated by this Agreement (whether brought against a party hereto or its respective affiliates, directors, officers, shareholders, employees or agents) shall be commenced in the state and federal courts sitting in the Miami, Florida (the “Florida Courts”). Each party hereto hereby irrevocably submits to the exclusive jurisdiction of the Florida Courts for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of such Florida Courts, or such Florida Courts are improper or inconvenient venue for such proceeding. Each party hereby irrevocably waives personal service of process and consents to process being served in any such suit, action or
SETTLEMENT AGREEMENT | PAGE 7
proceeding by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by applicable law. Each party hereto hereby irrevocably waives, to the fullest extent permitted by applicable law, any and all right to trial by jury in any legal proceeding arising out of or relating to this Agreement or the transactions contemplated hereby. If any party shall commence an action or proceeding to enforce any provisions of this Agreement, then the prevailing party in such action or proceeding shall be reimbursed by the other party for its attorneys’ fees and other costs and expenses incurred in the investigation, preparation and prosecution of such action or proceeding.
(h)Survival. The representations and warranties contained herein shall survive the Closing for the applicable statute of limitations.
(i)Execution. This Agreement may be executed in two (2) or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Counterparts may be delivered via electronic mail (including pdf or any electronic signature complying with the U.S. federal ESIGN Act of 2000, e.g., www.docusign.com) or other transmission method and any counterpart so delivered shall be deemed to have been duly and validly delivered and be valid and effective for all purposes.
(j)Severability. If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction to be invalid, illegal, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions set forth herein shall remain in full force and effect and shall in no way be affected, impaired or invalidated, and the parties hereto shall use their commercially reasonable efforts to find and employ, an alternative means to achieve the same or substantially the same result as that contemplated by such term, provision, covenant or restriction. It is hereby stipulated and declared to be the intention of the parties that they would have executed the remaining terms, provisions, covenants and restrictions without including any of such that may be hereafter declared invalid, illegal, void or unenforceable.
(k)Construction. The parties hereto agree that each of them and/or their respective counsel have reviewed and have had an opportunity to revise this Agreement and the schedules attached hereto. This Agreement shall be construed according to its fair meaning and not strictly for or against any party. The word “including” shall be construed to include the words “without limitation.” In this Agreement, unless the context otherwise requires, references to the singular shall include the plural and vice versa.
[ SIGNATURE PAGE FOLLOWS ]
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[ SIGNATURE PAGE TO SETTLEMENT AGREEMENT ]
IN WITNESS WHEREOF, the Parties have caused this Settlement Agreement to be duly executed and delivered as of the date and year first written above.
COMPANY:INVESTOR:
RAADR, INC.BOOT CAPITAL, LLC
By: /s/ Daniel ContrerasBy: /s/ Peter Rosten
Daniel ContrerasPeter Rosten
Chief Executive President
SETTLEMENT AGREEMENT | PAGE 9
EXHIBIT A
Description of the Company Obligations
1.Promissory note dated November 18, 2022, as amended as of October 8, 2024
Current Balance: $ 67,028.52
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SHARE EXCHANGE AGREEMENT
This Share Exchange Agreement (this “Agreement”) is entered into as of this 9th day of September, 2024, by and among Raadr, Inc., a Nevada corporation (“RDAR”), Mexedia Inc., a Florida corporation (“Acquired Company”), and Mexedia S.p.A. S.B., the owner of Acquired Company (the “Owner”).
RECITALS
WHEREAS, this Agreement is one of a series of agreements that would, when consummated, result in the Company’s (a) having acquired businesses and assets valued in excess of USD$60,000,000 and (b) having undergone a change in control (collectively, the “Change-in-Control Agreements”);
WHEREAS, the Boards of Directors of RDAR, Acquired Company and the Owner have determined that an acquisition of all of the issued and outstanding shares of capital stock of Acquired Company by RDAR through a share exchange upon the terms and subject to the conditions set forth in this Agreement (the “Share Exchange”) would be in the best interests of RDAR, Acquired Company and the Owner; and
WHEREAS, and the Boards of Directors of RDAR and Acquired Company have each approved the Share Exchange; and
WHEREAS, this Agreement is under consideration by the Board of Directors of the Owner for formal determination and approval; and
WHEREAS, pursuant to the Share Exchange, all of the right, title and interest in and to all of the issued and outstanding shares of capital stock of Acquired Company (the “Ownership Interest”) will be exchanged for 45,000 shares of Series F Preferred Stock of RDAR, the Certificate of Designation of which is attached hereto as Exhibit A, including the common stock into which such shares may be converted (the “Exchange Shares”); and
WHEREAS, RDAR, Acquired Company and the Owner desire to make certain representations, warranties, covenants and agreements in connection with the Share Exchange and also to prescribe various conditions to the Share Exchange.
NOW, THEREFORE, in consideration of the representations, warranties, covenants and agreements contained in this Agreement, the parties agree as follows:
Article I.
The Exchange
1.1Share Exchange. Upon the terms and subject to the conditions set forth in this Agreement, and in accordance with the Nevada Revised Statutes (the “Nevada Statutes”), at the Closing (defined below), the parties shall do the following:
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(a)Acquired Company shall cause the Owner to convey, assign and transfer the Ownership Interest to RDAR by delivering to RDAR duly executed assignments in proper form for transfer. The Ownership Interest transferred to RDAR at the Closing shall constitute 100% of the issued and outstanding shares of capital stock of Acquired Company.
(b)As consideration for its acquisition of the Ownership Interest, RDAR shall issue the Exchange Shares to the Owner by delivering a book entry record to the Owner evidencing the Exchange Shares (the “Exchange Shares Certificate”).
1.2Closing. Unless this Agreement shall have been terminated and the transactions herein contemplated shall have been abandoned pursuant to Article VIII, the closing date of the Exchange (the “Closing”) will take place on the business day upon satisfaction of the conditions set forth in Article VI (or as soon as practicable thereafter following satisfaction or waiver of the conditions set forth in Article VI) (the “Closing Date”), at such time and location as may be agreed upon by RDAR and Acquired Company; provided, however, that the Closing shall take place no later than January 31, 2025.
1.3Reorganization.
(a)As of the Closing, Jacob DiMartino shall resign as RDAR’s sole director and officer and Orlando Taddeo shall be appointed as the sole director and officer of RDAR.
(b)If at any time after the Closing, any party shall consider that any further deeds, assignments, conveyances, agreements, documents, instruments or assurances in law or any other things are necessary or desirable to vest, perfect, confirm or record in RDAR the title to any property, rights, privileges, powers and franchises of Acquired Company by reason of, or as a result of, the Share Exchange, or otherwise to carry out the provisions of this Agreement, the remaining parties, as applicable, shall execute and deliver, upon request, any instruments or assurances, and do all other things necessary or proper to vest, perfect, confirm or record title to such property, rights, privileges, powers and franchises in RDAR, and otherwise to carry out the provisions of this Agreement.
Article II.
Compliance with Applicable Securities Laws
2.1Covenants, Representations and Warranties of the Owner.
(a)The Owner acknowledges and agrees that it is acquiring the Exchange Shares for investment purposes and will not offer, sell or otherwise transfer, pledge or hypothecate any of the Exchange Shares issued to them (other than pursuant to an effective Registration Statement under the Securities Act of 1933, as amended (the “Securities Act”)) directly or indirectly unless:
(1)the sale is to RDAR; or
(2)the Exchange Shares are sold in a transaction that does not require registration under the Securities Act, or any applicable United States state laws and regulations governing the offer and sale of securities, and the seller has furnished to RDAR an opinion of counsel to that effect or such other written opinion as may be reasonably required by RDAR.
(b)The Owner acknowledges and agrees that the book entry record representing the Exchange Shares shall bear a restrictive legend, substantially in the following form:
MEXEDIA, INC. SHARE EXCHANGE AGREEMENT | PAGE 2
“THE SECURITIES REPRESENTED BY THIS STOCK CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”) OR APPLICABLE STATE SECURITIES LAWS, AND SHALL NOT BE SOLD, PLEDGED, HYPOTHECATED, DONATED, OR OTHERWISE TRANSFERRED (WHETHER OR NOT FOR CONSIDERATION) BY THE HOLDER EXCEPT UPON THE ISSUANCE TO THE COMPANY OF A FAVORABLE OPINION OF ITS COUNSEL OR THE SUBMISSION TO THE COMPANY OF SUCH OTHER EVIDENCE AS MAY BE SATISFACTORY TO COUNSEL FOR THE COMPANY, TO THE EFFECT THAT ANY SUCH TRANSFER SHALL NOT BE IN VIOLATION OF THE SECURITIES ACT OR APPLICABLE STATE SECURITIES LAWS.”
(c)The Owner represents and warrants that it:
(1)is not aware of any advertisement of, or other form or general solicitation with respect to, any of the Exchange Shares being issued hereunder;
(2)acknowledges and agrees that RDAR will refuse to register any transfer of the Exchange Shares not made pursuant to an effective registration statement under the Securities Act or pursuant to an available exemption from the registration requirements of the Securities Act and in accordance with applicable state and provincial securities laws; and
(3)acknowledges and agrees to RDAR making a notation on its records or giving instructions to the registrar and transfer agent of RDAR in order to implement the restrictions on transfer set forth and described herein.
Article III.
Representations and Warranties
3.1Representations and Warranties of Acquired Company and the Owner. As a material inducement for RDAR to enter into this Agreement and to consummate the transactions contemplated hereby, Acquired Company and the Owner hereby make the following representations and warranties as of the date hereof and as of the Closing Date, each of which is relied upon by RDAR regardless of any investigation made or information obtained by RDAR (unless and to the extent specifically and expressly waived in writing by RDAR on or before the Closing Date):
(a)Organization, Standing and Power; No Disability. Acquired Company is duly organized, validly existing and in good standing under the laws of the State of Florida. The Owner is duly organized, validly existing and in good standing under the laws of its organization.
(b)Subsidiaries. Acquired Company has two subsidiaries: (1) Matchcom Technologies, Inc., a Florida corporation; and (2) Phonetime, Inc., a Florida corporation.
(c)Corporate Documents. Schedule 3.1(c) contains true and correct copies of the Articles of Incorporation and bylaws of Acquired Company, each as amended to date.
(d)Ownership Interest. The Ownership Interest represents 100% of the issued and outstanding shares of capital stock of Acquired Company. Acquired Company also warrants that there are no outstanding bonds, debentures, notes or other indebtedness or other securities of Acquired Company. There are no rights, commitments, agreements, arrangements or undertakings of any kind to which Acquired Company is a party or by which it is bound obligating Acquired Company to issue, deliver or sell, or cause to be issued, delivered or sold, additional ownership interests of Acquired Company or obligating Acquired Company to issue, grant, extend or enter into any such right, commitment, agreement, arrangement or undertaking. There are
MEXEDIA, INC. SHARE EXCHANGE AGREEMENT | PAGE 3
no outstanding contractual obligations, commitments, understandings or arrangements of Acquired Company to repurchase, redeem or otherwise acquire or make any payment in respect of the capital stock of Acquired Company.
(e)Capitalization of Acquired Company. Schedule 3(e) sets forth the issued and outstanding shares of capital stock of Acquired Company (the Ownership Interest). All of Acquired Company’s issued and outstanding shares of capital stock have been duly authorized, are validly issued, fully paid and non-assessable.
(f)Authority; Non-contravention. Acquired Company and the Owner have all requisite power and authority to enter into this Agreement and to consummate the transactions contemplated by this Agreement. The execution and delivery of this Agreement by Acquired Company and its Owner and the consummation by Acquired Company and the Owner of the transactions contemplated hereby have been (or at Closing will have been) duly authorized by all necessary action on the part of Acquired Company. This Agreement has been duly executed and when delivered by Acquired Company and the Owner shall constitute a valid and binding obligation of Acquired Company and the Owner, enforceable against Acquired Company and the Owner, as applicable, in accordance with its terms, except as such enforcement may be limited by bankruptcy, insolvency or other similar laws affecting the enforcement of creditors’ rights generally or by general principles of equity. The execution and delivery of this Agreement does not, and the consummation of the transactions contemplated by this Agreement and compliance with the provisions hereof will not, conflict with, or result in any breach or violation of, or default (with or without notice or lapse of time, or both) under, or give rise to a right of termination, cancellation or acceleration of or “put” right with respect to any obligation or to a loss of a material benefit under, or result in the creation of any lien upon any of the properties or assets of Acquired Company under, (1) the articles of incorporation or bylaws of Acquired Company, (2) any loan or credit agreement, note, bond, mortgage, indenture, lease or other agreement, instrument, permit, concession, franchise or license applicable to Acquired Company, its properties or assets, or (3) subject to the governmental filings and other matters referred to in the following sentence, any judgment, order, decree, statute, law, ordinance, rule, regulation or arbitration award applicable to Acquired Company, its properties or assets, other than, in the case of clauses (ii) and (iii), any such conflicts, breaches, violations, defaults, rights, losses or liens that individually or in the aggregate could not have a material adverse effect with respect to Acquired Company or could not prevent, hinder or materially delay the ability of Acquired Company to consummate the transactions contemplated by this Agreement.
(g)Governmental Authorization. No consent, approval, order or authorization of, or registration, declaration or filing with, or notice to, any United States court, administrative agency or commission, or other federal, state or local government or other governmental authority, agency, domestic or foreign (a “Governmental Entity”), is required by or with respect to Acquired Company in connection with the execution and delivery of this Agreement by Acquired Company or the consummation by Acquired Company of the transactions contemplated hereby, except, with respect to this Agreement, any filings under the Securities Act or the Securities Exchange Act of 1934 and the rules and regulations promulgated thereunder (the “Exchange Act”) or pursuant to the rules of OTC Markets.
(h)Financial Statements.
(1)At Closing, RDAR will have received from Acquired Company a copy of its unaudited financial statements for the years ended December 31, 2023 and 2022, and for the six months ended June 30, 2024 (collectively, the “Acquired Company Financial Statements”). The Acquired Company Financial Statements fairly present the financial condition of Acquired Company at the dates indicated and its results of operations and cash flows for the periods then ended and, except as indicated therein, reflect all
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claims, debts and liabilities of Acquired Company, fixed or contingent, and of whatever nature.
(2)Since June 30, 2024, there has been no material adverse change in the assets or liabilities, or in the business or condition, financial or otherwise, or in the results of operations or prospects, of Acquired Company, whether as a result of any legislative or regulatory change, revocation of any license or rights to do business, fire, explosion, accident, casualty, labor trouble, flood, drought, riot, storm, condemnation, act of God, public force or otherwise and no material adverse change in the assets or liabilities, or in the business or condition, financial or otherwise, or in the results of operation or prospects, of Acquired Company except in the ordinary course of business.
(3)Since June 30, 2024, Acquired Company has not issued, sold or otherwise disposed of, or agreed to issue, sell or otherwise dispose of, any securities of Acquired Company, and has not granted or agreed to grant any other right to subscribe for or to purchase any securities of Acquired Company or has incurred or agreed to incur any indebtedness for borrowed money.
(i)Absence of Certain Changes or Events. Since June 30, 2024, Acquired Company has conducted its business only in the ordinary course consistent with past practice, and there is not and has not been any:
(1)material adverse change with respect to Acquired Company including any amendments to its formation and governance documents;
(2)event which, if it had taken place following the execution of this Agreement, would not have been permitted by Section 4.1 without prior consent of RDAR;
(3)condition, event or occurrence which could reasonably be expected to prevent, hinder or materially delay the ability of Acquired Company to consummate the transactions contemplated by this Agreement;
(4)incurrence, assumption or guarantee by Acquired Company of any indebtedness for borrowed money other than in the ordinary course and in amounts and on terms consistent with past practices or as disclosed to RDAR in writing;
(5)creation or other incurrence by Acquired Company of any lien on any asset other than in the ordinary course consistent with past practices;
(6)transaction or commitment made, or any contract or agreement entered into, by Acquired Company relating to its assets or business (including the acquisition or disposition of any assets) or any relinquishment by Acquired Company of any contract or other right, in either case, material to Acquired Company, other than transactions and commitments in the ordinary course consistent with past practices and those contemplated by this Agreement;
(7)labor dispute, other than routine, individual grievances, or, to the knowledge of Acquired Company, any activity or proceeding by a labor union or representative thereof to organize any employees of Acquired Company or any lockouts, strikes, slowdowns, work stoppages or threats by or with respect to such employees;
(8)payment, prepayment or discharge of liability other than in the ordinary course of business or any failure to pay any liability when due;
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(9)write-offs or write-downs of any assets of Acquired Company;
(10)creation, termination or amendment of, or waiver of any right under, any material contract of Acquired Company;
(11)damage, destruction or loss having, or reasonably expected to have, a material adverse effect on Acquired Company;
(12)other condition, event or occurrence which individually or in the aggregate could reasonably be expected to have a material adverse effect or give rise to a material adverse change with respect to Acquired Company; or
(13)agreement or commitment to do any of the foregoing.
(j)Certain Fees. No brokerage or finder’s fees or commissions are or will be payable by Acquired Company to any broker, financial advisor or consultant, finder, placement agent, investment banker, bank or other person with respect to the transactions contemplated by this Agreement.
(k)Litigation; Labor Matters; Compliance with Laws.
(1)Except as set forth in Schedule 3(k)(1), there is no suit, action or proceeding or investigation pending or, to the knowledge of Acquired Company, threatened against or affecting Acquired Company or any basis for any such suit, action, proceeding or investigation that, individually or in the aggregate, could reasonably be expected to have a material adverse effect with respect to Acquired Company or prevent, hinder or materially delay the ability of Acquired Company to consummate the transactions contemplated by this Agreement, nor is there any judgment, decree, injunction, rule or order of any governmental entity or arbitrator outstanding against Acquired Company having, or which, insofar as reasonably could be foreseen by Acquired Company, in the future could have, any such effect.
(2)Acquired Company is not a party to, or bound by, any collective bargaining agreement, contract or other agreement or understanding with a labor union or labor organization, nor is it the subject of any proceeding asserting that it has committed an unfair labor practice or seeking to compel it to bargain with any labor organization as to wages or conditions of employment nor is there any strike, work stoppage or other labor dispute involving it pending or, to its knowledge, threatened, any of which could have a material adverse effect with respect to Acquired Company.
(3)The conduct of the business of Acquired Company complies with all statutes, laws, regulations, ordinances, rules, judgments, orders, decrees or arbitration awards applicable thereto.
(l)Benefit Plans. Acquired Company is not a party to any Benefit Plan under which Acquired Company currently has an obligation to provide benefits to any current or former employee, officer or director of Acquired Company. As used herein, “Benefit Plan” shall mean any employee benefit plan, program, or arrangement of any kind, including any defined benefit or defined contribution plan, ownership plan with respect to any membership interest, executive compensation program or arrangement, bonus plan, incentive compensation plan or arrangement, profit sharing plan or arrangement, deferred compensation plan, agreement or arrangement, supplemental retirement plan or arrangement, vacation pay, sickness, disability, or death benefit plan (whether provided through insurance, on a funded or unfunded basis, or otherwise), medical or life insurance plan providing benefits to employees, retirees, or former employees or any of their dependents, survivors, or beneficiaries, severance pay, termination, salary continuation, or employee assistance plan.
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(m)Tax Returns and Tax Payments.
(1)Acquired Company has timely filed with the appropriate taxing authorities all Tax Returns, as that term is hereinafter defined, required to be filed by it (taking into account all applicable extensions). All such Tax Returns are true, correct and complete in all respects. All Taxes, as that term is hereinafter defined, due and owing by Acquired Company have been paid (whether or not shown on any Tax Return and whether or not any Tax Return was required). Acquired Company is not currently the beneficiary of any extension of time within which to file any Tax Return or pay any Tax. No claim has ever been made in writing or otherwise addressed to Acquired Company by a taxing authority in a jurisdiction where Acquired Company does not fileTax Returns that it is or may be subject to taxation by that jurisdiction. Since inception, Acquired Company has not incurred any liability for Taxes outside the ordinary course of business consistent with past custom and practice.
(2)No material claim for unpaid Taxes has been made or become a lien against the property of Acquired Company or is being asserted against Acquired Company, no audit of any Tax Return of Acquired Company is being conducted by a tax authority, and no extension of the statute of limitations on the assessment of any Taxes has been granted by Acquired Company and is currently in effect. Acquired Company has withheld and paid all Taxes required to have been withheld and paid in connection with amounts paid or owing to any employee, independent contractor, creditor, stockholder or other third party.
(3)As used herein, “Taxes” shall mean all taxes of any kind, including, without limitation, those on or measured by or referred to as income, gross receipts, sales, use, ad valorem, franchise, profits, license, withholding, payroll, employment, excise, severance, stamp, occupation, premium value added, property or windfall profits taxes, customs, duties or similar fees, assessments or charges of any kind whatsoever, together with any interest and any penalties, additions to tax or additional amounts imposed by any governmental authority, domestic or foreign. As used herein, “ Tax Return “ shall mean any return, report or statement required to be filed with any governmental authority with respect to Taxes.
(n)Environmental Matters. Acquired Company is in compliance with all Environmental Laws in all material respects. Acquired Company has not received any written notice regarding any violation of any Environmental Laws, as that term is hereinafter defined, including any investigatory, remedial or corrective obligations. Acquired Company holds all permits and authorizations required under applicable Environmental Laws, unless the failure to hold such permits and authorizations would not have a material adverse effect on Acquired Company, and is in compliance with all terms, conditions and provisions of all such permits and authorizations in all material respects. No releases of Hazardous Materials, as that term is hereinafter defined, have occurred at, from, in, to, on or under any real property currently or formerly owned, operated or leased by Acquired Company or any predecessor thereof and no Hazardous Materials are present in, on, about or migrating to or from any such property which could result in any liability to Acquired Company. Acquired Company has not transported or arranged for the treatment, storage, handling, disposal, or transportation of any Hazardous Material to any off-site location which could result in any liability to Acquired Company. Acquired Company has no liability, absolute or contingent, under any Environmental Law that if enforced or collected would have a material adverse effect on Acquired Company. There are no past, pending or threatened claims under Environmental Laws against Acquired Company and Acquired Company is not aware of any facts or circumstances that could reasonably be expected to result in a liability or claim against Acquired Company pursuant to Environmental Laws. “Environmental Laws” means all applicable foreign, federal, state and local statutes, rules, regulations, ordinances, orders, decrees and common law relating in any manner to contamination, pollution or protection of human health or the environment, and similar state laws. “Hazardous Material” means any toxic, radioactive, corrosive or otherwise hazardous substance, including petroleum, its derivatives, by-products and other hydrocarbons, or any substance having any constituent elements displaying
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any of the foregoing characteristics, which in any event is regulated under any Environmental Law.
(o)Material Contracts. All Material Contracts copies of which have been furnished to RDAR. Acquired Company is not, or has not received any notice or has any knowledge that any other party is, in default in any respect under any Material Contract, as that term is hereinafter defined; and there has not occurred any event that with the lapse of time or the giving of notice or both would constitute such a material default.
For purposes of this Agreement, a “Material Contract” means any contract, agreement or commitment that is effective as of the Closing Date to which Acquired Company is a party (1) with expected receipts or expenditures in an amount in excess of two percent (2%) of Acquired Company’s gross revenues for the 12 months ended July 31, 2025, (2) requiring Acquired Company to indemnify any person in an amount that is expected to exceed ten percent (10%) of Acquired Company’s owners’ equity as of the date of Closing, (3) granting exclusive rights to any party, (4) evidencing indebtedness for borrowed or loaned money in an amount in excess of ten percent (10%) of Acquired Company’s owners’ equity, including guarantees of such indebtedness, as of the date of Closing, or (5) which, if breached by Acquired Company in such a manner would (A) permit any other party to cancel or terminate the same (with or without notice of passage of time) or (B) provide a basis for any other party to claim money damages (either individually or in the aggregate with all other such claims under that contract) from Acquired Company or (C) give rise to a right of acceleration of any material obligation or loss of any material benefit under any such contract, agreement or commitment.
(p)Properties. Acquired Company has no real property. Any facilities held under lease by Acquired Company is held by it under valid, subsisting and enforceable leases of which Acquired Company is in compliance, except as could not, individually or in the aggregate, have or reasonably be expected to result in a material adverse effect.
(q)Intellectual Property.
(1)As used in this Agreement, the term “Trademarks” means trademarks, service marks, trade names, internet domain names, designs, slogans, and general intangibles of like nature; the term “Trade Secrets” means technology; trade secrets and other confidential information, know-how, proprietary processes, formulae, algorithms, models, and methodologies; the term “ Intellectual Property “ means patents, copyrights, Trademarks, applications for any of the foregoing, and Trade Secrets; the term “ Company License Agreements “ means any license agreements granting any right to use or practice any rights under any Intellectual Property (except for such agreements for off-the-shelf products that are generally available for less than $10,000), and any written settlements relating to any Intellectual Property, to which Acquired Company is a party or otherwise bound; and the term “ Software “ means any and all computer programs, including any and all software implementations of algorithms, models and methodologies, whether in source code or object code.
(2)Acquired Company owns or has valid rights to use the Trademarks, trade names, domain names, copyrights, patents, logos, licenses and computer software programs (including, without limitation, the source codes thereto) that are necessary for the conduct of its respective businesses as now being conducted. To the knowledge of Acquired Company, none of Acquired Company’s Intellectual Property or License Agreements infringe upon the rights of any third party that may give rise to a cause of action or claim against Acquired Company or its successors.
(r)Affiliate Transactions. Except as set forth in Schedule 3(r), no officer, director or employee of Acquired Company or any member of the immediate family of any such officer, director or employee, or any entity in which any of such persons owns any beneficial interest (other than any publicly-held
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corporation whose stock is traded on a national securities exchange or in the over-the-counter market and less than one percent of the stock of which is beneficially owned by any of such persons), has any agreement with Acquired Company or any interest in any of their property of any nature, used in or pertaining to the business of Acquired Company. None of the foregoing persons has any direct or indirect interest in any competitor, supplier or customer of Acquired Company or in any person from whom or to whom Acquired Company leases any property or transacts business of any nature.
(s)Undisclosed Liabilities. Except as set forth in Schedule 3(s), Acquired Company has no liabilities or obligations of any nature (whether fixed or unfixed, secured or unsecured, known or unknown and whether absolute, accrued, contingent, or otherwise.)
(t)Full Disclosure. All of the representations and warranties made by Acquired Company in this Agreement, and all statements set forth in the certificates delivered by Acquired Company at the Closing pursuant to this Agreement, are true, correct and complete in all material respects and do not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make such representations, warranties or statements, in light of the circumstances under which they were made, misleading. The copies of all documents furnished by Acquired Company pursuant to the terms of this Agreement are complete and accurate copies of the original documents. The schedules, certificates, and any and all other statements and information, whether furnished in written or electronic form, to RDAR or its representatives by or on behalf of any of Acquired Company or its affiliates in connection with the negotiation of this Agreement and the transactions contemplated hereby do not contain any material misstatement of fact or omit to state a material fact or any fact necessary to make the statements contained therein not misleading.
3.2Representations and Warranties of RDAR. As a material inducement for Acquired Company and the Owner to enter into this Agreement and to consummate the transactions contemplated hereby, RDAR hereby makes the following representations and warranties as of the date hereof and as of the Closing Date, each of which is relied upon by Acquired Company regardless of any investigation made or information obtained by Acquired Company (unless and to the extent specifically and expressly waived in writing by Acquired Company on or before the Closing Date):
(a)Organization, Standing and Corporate Power. RDAR is a corporation duly organized, validly existing and in good standing under the laws of the State of Nevada and has the requisite corporate power and authority and all government licenses, authorizations, permits, consents and approvals required to own, lease and operate its properties and carry on its business as now being conducted. RDAR is duly qualified or licensed to do business and is in good standing in each jurisdiction in which the nature of its business or the ownership or leasing of its properties makes such qualification or licensing necessary, other than in such jurisdictions where the failure to be so qualified or licensed (individually or in the aggregate) would not have a material adverse effect with respect to RDAR.
(b)Subsidiaries. RDAR has no subsidiaries.
(c)Capitalization of RDAR. The entire authorized capital stock of RDAR consists of 15,000,000,000 common shares, par value $0.001 per share, of which 4,433,149,661 shares are issued and outstanding, and 100,000,000 shares of preferred stock, par value $0.001 per share, (1) 1,000,000 shares of which are designated Series E Preferred Stock and 1,000,000 shares of which are issued and outstanding and (2) 75,000 shares of which are designated Series F Preferred Stock and no shares of which are issued and outstanding. All of RDAR’s issued and outstanding shares have been duly authorized, are validly issued, fully paid and non-assessable.
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Except as set forth in Schedule 3.2(c), there are no other shares of RDAR capital stock issuable upon the exercise of outstanding warrants, convertible notes, options or otherwise. Except as set forth in Schedule 3.2(c), no shares of capital stock or other equity securities of RDAR are issued, reserved for issuance or outstanding.
The Exchange Shares will be, when issued, duly authorized, validly issued, fully paid and non-assessable, not subject to preemptive rights and issued in compliance with all applicable state and federal laws concerning the issuance of securities.
(d)Corporate Authority; Non-contravention. RDAR has all requisite corporate and other power and authority to enter into this Agreement and to consummate the transactions contemplated by this Agreement. The execution and delivery of this Agreement by RDAR and the consummation by RDAR of the transactions contemplated hereby have been (or at Closing will have been) duly authorized by all necessary corporate action on the part of RDAR. This Agreement has been duly executed and when delivered by RDAR shall constitute a valid and binding obligation of RDAR, enforceable against RDAR in accordance with its terms, except as such enforcement may be limited by bankruptcy, insolvency or other similar laws affecting the enforcement of creditors’ rights generally or by general principles of equity. The execution and delivery of this Agreement does not, and the consummation of the transactions contemplated by this Agreement and compliance with the provisions hereof will not, conflict with, or result in any breach or violation of, or default (with or without notice or lapse of time, or both) under, or give rise to a right of termination, cancellation or acceleration of or “put” right with respect to any obligation or to loss of a material benefit under, or result in the creation of any lien upon any of the properties or assets of RDAR under (1) its articles of incorporation, bylaws, or other charter documents; (2) any loan or credit agreement, note, bond, mortgage, indenture, lease or other agreement, instrument, permit, concession, franchise or license applicable to RDAR,its properties or assets; or (3) subject to the governmental filings and other matters referred to in the following sentence, any judgment, order, decree, statute, law, ordinance, rule, regulation or arbitration award applicable to RDAR, its properties or assets, other than, in the case of clauses (2) and (3), any such conflicts, breaches, violations, defaults, rights, losses or liens that individually or in the aggregate could not have a material adverse effect with respect to RDAR or could not prevent, hinder or materially delay the ability of RDAR to consummate the transactions contemplated by this Agreement.
(e)Government Authorization. No consent, approval, order or authorization of, or registration, declaration or filing with, or notice to, any Governmental Entity, is required by or with respect to RDAR in connection with the execution and delivery of this Agreement by RDAR, or the consummation by RDAR of the transactions contemplated hereby, except, with respect to this Agreement, any filings under the Nevada Statutes, the Securities Act or the Exchange Act.
(f)Financial Statements.
(1)The unaudited financial statements of RDAR included in the reports, schedules, forms, statements and other documents filed by RDAR with OTC Markets (collectively, and in each case including all exhibits and schedules thereto and documents incorporated by reference therein, the “RDAR Financial Information”) comply as to form in all material respects with applicable accounting requirements and the published rules of OTC Markets with respect thereto, have been prepared in accordance with U.S. generally accepted accounting principles applied on a consistent basis during the periods involved (except as may be indicated in the notes thereto) and fairly present the consolidated financial position of RDAR and its consolidated subsidiaries as of the dates thereof and the consolidated results of operations and changes in cash flows for the periods then ended. Except as set forth in the RDAR Financial Information, at the date of the most recent unaudited financial statements of RDAR included in the RDAR Financial Information, RDAR has not
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incurred any liabilities or obligations of any nature (whether accrued, absolute, contingent or otherwise) which, individually or in the aggregate, could reasonably be expected to have a material adverse effect with respect to RDAR.
(2)RDAR has made the following financial information (the RDAR Financial Information) available to Acquired Company:
(A)unaudited balance sheet and statements of income, changes in stockholders’ equity and cash flow as of and for the years ended December 31, 2023 and 2022;
(B)unaudited balance sheet and statements of income, changes in stockholders’ equity and cash flow as of and for the six months ended June 30, 2024 (the “RDAR Interim Statements”); and
(C)The RDAR Financial Information presents fairly the financial condition of RDAR as of such dates and the results of operations of RDAR for such periods, in accordance with GAAP and are consistent with the books and records of RDAR (which books and records are correct and complete).
(g)Events Subsequent to RDAR Interim Statements. Since the date of the RDAR Interim Statements, there has not been, occurred or arisen, with respect to RDAR:
(1)any change or amendment in its Articles of Incorporation and/or Bylaws;
(2)any reclassification, split-up or other change in, or amendment of or modification to, the rights of the holders of any of its capital stock, except changes made in relation to the transactions contemplated by this Agreement;
(3)any direct or indirect redemption, purchase or acquisition by any person of any of its capital stock or of any interest in or right to acquire any such stock;
(4)any issuance, sale, or other disposition of any capital stock, or any grant of any options, warrants, or other rights to purchase or obtain (including upon conversion, exchange, or exercise) any capital stock;
(5)any declaration, set aside, or payment of any dividend or any distribution with respect to its capital stock (whether in cash or in kind) or any redemption, purchase, or other acquisition of any of its capital stock;
(6)the organization of any subsidiary or the acquisition of any shares of capital stock by any person or any equity or ownership interest in any business;
(7)any damage, destruction or loss of any of its properties or assets whether or not covered by insurance;
(8)any sale, lease, transfer or assignment of any of its assets, tangible or intangible, other than for a fair consideration in the ordinary course of business;
(9)the execution of, or any other commitment to any agreement, contract, lease, or license (or series of related agreements, contracts, leases, and licenses) outside the ordinary course of business;
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(10)any acceleration, termination, modification, or cancellation of any agreement, contract lease or license (or series of related agreements, contracts, leases, and licenses) involving more than $10,000 to which it is a party or by which it is bound;
(11)any security interest or encumbrance imposed upon any of its assets, tangible;
(12)any capital investment in, any loan to, or any acquisition of the securities or assets of, any other person or entity (or series of related capital investments, loans and acquisitions) involving more than $2,500 and outside the ordinary course of business;
(13)any issuance of any note, bond or other debt security, or created, incurred, assumed, or guaranteed any indebtedness for borrowed money or capitalized lease obligation involving more than $2,500;
(14)any delay or postponement of the payment of accounts payable or other liabilities;
(15)any loan to, or any entrance into any other transaction with, any of its directors, officers and employees either involving more than $500 individually or $2,500 in the aggregate;
(16)any employment contract or collective bargaining agreement, written or oral, or modified the terms of any existing such contract or agreement;
(17)any taking of other action or entrance into any other transaction other than in the ordinary course of business, or entrance into any transaction with any insider of RDAR, except as disclosed in this Agreement and any disclosures schedules;
(18)any other event or occurrence that may have or could reasonably be expected to have a material adverse effect on RDAR (whether or not similar to any of the foregoing); or
(19)any agreement, whether in writing or otherwise, to do any of the foregoing.
(h)Certain Fees. No brokerage or finder’s fees or commissions are or will be payable by RDAR to any broker, financial advisor or consultant, finder, placement agent, investment banker, bank or other person with respect to the transactions contemplated by this Agreement.
(i)Litigation; Labor Matters; Compliance with Laws.
(1)There is no suit, action or proceeding or investigation pending or, to the knowledge of RDAR, threatened against or affecting RDAR or any basis for any such suit, action, proceeding or investigation that, individually or in the aggregate, could reasonably be expected to have a material adverse effect with respect to RDAR or prevent, hinder or materially delay the ability of RDAR to consummate the transactions contemplated by this Agreement, nor is there any judgment, decree, injunction, rule or order of any Governmental Entity or arbitrator outstanding against RDAR having, or which, insofar as reasonably could be foreseen by RDAR, in the future could have, any such effect.
(2)The conduct of the business of RDAR complies with all statutes, laws, regulations, ordinances, rules, judgments, orders, decrees or arbitration awards applicable thereto.
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(j)Contracts. Except as set forth in Schedule 3.2(j), RDAR has no written or oral contracts, understandings, agreements and other arrangements executed by an officer or duly authorized employee of RDAR or to which RDAR is a party, except for this Agreement.
(k)OTC Markets Reports and Financial Statements. RDAR has filed with OTC Markets all reports and other filings required to be filed by RDAR in accordance with the rules of OTC Markets (the “RDAR OTC Markets Reports”). As of their respective dates, the RDAR OTC Markets Reports complied in all material respects with the applicable requirements of the Securities Act, the Exchange Act and the respective rules and regulations promulgated thereunder applicable to such RDAR OTC Markets Reports and, except to the extent that information contained in any RDAR OTC Markets Report has been revised or superseded by a later RDAR OTC Markets Report filed and publicly available prior to the date of this Agreement, none of the RDAR OTC Markets Reports contained any untrue statement of a material fact or omitted to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. The financial statements of RDAR included in RDAR OTC Markets Reports were prepared from and are in accordance with the accounting books and other financial records of RDAR, were prepared in accordance with GAAP applied on a consistent basis during the periods involved (except as may be indicated in the notes thereto) and presented fairly the consolidated financial position of RDAR as of the dates thereof and the consolidated results of operations and cash flows for the periods then ended. Except as set forth in the RDAR OTC Markets Reports, RDAR has no liabilities or obligations of any nature (whether accrued, absolute, contingent or otherwise) other than liabilities or obligations incurred in the ordinary course of business. The RDAR OTC Markets Reports accurately disclose (1) the terms and provisions of all stock option plans, (2) transactions with Affiliates and (3) all material contracts. If at any time prior to Closing should RDAR become delinquent in any required filings with OTC Markets, RDAR represents and warrants that such filings shall be brought current in no less than 10 business days from the due date. Until such time as the filing is brought current, RDAR will promptly file any and all reports required to advise the SEC of the failure to file the reports when due.
(l)Board Determination. The Board of Directors of RDAR has unanimously determined that the terms of the Share Exchange are fair to and in the best interests of RDAR and its stockholders.
(m)Required RDAR Share Issuance Approval. RDAR represents that the issuance of the Exchange Shares to the Owner will be in compliance with the Nevada Statutes and the Bylaws of RDAR, as well as federal and state securities laws.
(n)Undisclosed Liabilities. Except as set forth in Schedule 3.2(n), RDAR has no liabilities or obligations of any nature (whether fixed or unfixed, secured or unsecured, known or unknown and whether absolute, accrued, contingent, or otherwise) except for liabilities or obligations reflected or reserved against in the RDAR OTC Markets Documents incurred in the ordinary course of business.
(o)Full Disclosure. All of the representations and warranties made by RDAR in this Agreement, and all statements set forth in the certificates delivered by RDAR at the Closing pursuant to this Agreement, are true, correct and complete in all material respects and do not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make such representations, warranties or statements, in light of the circumstances under which they were made, misleading. The copies of all documents furnished by RDAR pursuant to the terms of this Agreement are complete and accurate copies of the original documents. The schedules, certificates, and any and all other statements and information, whether furnished in written or electronic form, to Acquired Company or its representatives by or on behalf of RDAR in connection with the negotiation of this Agreement and the transactions contemplated hereby do not contain any material misstatement of fact or omit to state a material fact or any fact necessary to make the statements contained
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therein not misleading.
(p)Powers of Attorney. There are no outstanding powers of attorney executed on behalf of RDAR.
Article IV.
Covenants Relating to Conduct of Business Prior to Share Exchange
4.1Conduct of Acquired Company and RDAR. From the date of this Agreement and until the Effective Time, or until the prior termination of this Agreement, Acquired Company and RDAR shall not, unless mutually agreed to in writing:
(a)engage in any transaction, except in the normal and ordinary course of business, or create or suffer to exist any lien or other encumbrance upon any of their respective assets or which will not be discharged in full prior to the Effective Time;
(b)sell, assign or otherwise transfer any of their assets, or cancel or compromise any debts or claims relating to their assets, other than for fair value, in the ordinary course of business, and consistent with past practice;
(c)fail to use reasonable efforts to preserve intact their present business organizations, keep available the services of their employees and preserve its material relationships with customers, suppliers, licensors, licensees, distributors and others, to the end that its good will and ongoing business not be impaired prior to the Effective Time;
(d)suffer or permit any material adverse change to occur with respect to Acquired Company and RDAR or their business or assets; and
(e)make any material change with respect to their business in accounting or bookkeeping methods, principles or practices, except as required by GAAP.
4.2Current Information.
(a)During the period from the date of this Agreement to the Closing, each party hereto shall promptly notify each other party of any (1) significant change in its ordinary course of business, (2) proceeding (or communications indicating that the same may be contemplated), or the institution or threat or settlement of proceedings, in each case involving the Parties the outcome of which, if adversely determined, could reasonably be expected to have a material adverse effect on the Party, taken as a whole or (3) event which such Party reasonably believes could be expected to have a material adverse effect on the ability of any party hereto to consummate the Share Exchange.
(b)During the period from the date of this Agreement to the Closing, RDAR shall promptly notify Acquired Company of any correspondence received from OTC Markets or the SEC and shall deliver a copy of such correspondence to Acquired Company within one (1) business day of receipt.
4.3Material Transactions. Prior to the Closing, neither Acquired Company nor RDAR will, without first obtaining the written consent of the other parties hereto:
(a)amend its Articles of Incorporation or Bylaws or enter into any agreement to merge or
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consolidate with, or sell a significant portion of its assets to, any other Person;
(b)place on any of its assets or properties any pledge, charge or other encumbrance, except as otherwise authorized hereunder, or enter into any transaction or make any contract or commitment relating to its properties, assets and business, other than in the ordinary course of business or as otherwise disclosed herein;
(c)guarantee the obligation of any person, firm or corporation, except in the ordinary course of business;
(d)make any loan or advance in excess of $2,500 in the aggregate or cancel or accelerate any material indebtedness owing to it or any claims which it may possess or waive any material rights of substantial value;
(e)violate any applicable law which violation might have a material adverse effect on such party;
(f)except in the ordinary course of business, enter into any agreement or transaction with any of such party’s affiliates; or
(g)engage in any transaction or take any action that would render untrue in any material respect any of the representations and warranties of such party contained in this Agreement, as if such representations and warranties were given as of the date of such transaction or action.
Article V.
Additional Agreements
5.1Reorganization Agreement: Mexedia DAC. At or prior to the Closing, RDAR, Mexedia DAC (“Mexedia Ireland”) and the owner of Mexedia Ireland shall have entered into a Share Exchange Agreement, in the form of Exhibit B attached hereto (the “Mexedia Ireland SPA”), pursuant to which RDAR would acquire all of the outstanding shares of capital stock of Mexedia Ireland.
5.2Redemption Agreement. At or prior to the Closing, RDAR and JanBella Group, LLC shall have entered into a Redemption Agreement, in the form of Exhibit C attached hereto (the “Redemption Agreement”), pursuant to which RDAR would re-acquire all outstanding shares of Series E Preferred Stock of RDAR.
5.3Access to Information; Confidentiality.
(a)Acquired Company shall, and shall cause its officers, employees, counsel, financial advisors and other representatives to, afford to RDAR and its representatives reasonable access during normal business hours during the period prior to the Effective Time to its and to Acquired Company’s properties, books, contracts, commitments, personnel and records and, during such period, Acquired Company shall, and shall cause its officers, employees and representatives to, furnish promptly to RDAR all information concerning its business, properties, financial condition, operations and personnel as such other party may from time to time reasonably request. For the purposes of determining the accuracy of the representations and warranties of RDAR set forth herein and compliance by RDAR of its obligations hereunder, during the period prior to the Effective Time, RDAR shall provide Acquired Company and its representatives with reasonable access during normal business hours to its properties, books, contracts, commitments, personnel and records as may be necessary to enable Acquired Company to confirm the accuracy of the representations and warranties of RDAR
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set forth herein and compliance by RDAR of its obligations hereunder, and, during such period, RDAR shall, and shall cause its officers, employees and representatives to, furnish promptly to Acquired Company upon its request (1) a copy of each report, schedule, registration statement and other document filed by it during such period pursuant to the requirements of federal or state securities laws and (2) all other information concerning its business, properties, financial condition, operations and personnel as such other party may from time to time reasonably request.
Except as required by law, each of Acquired Company and RDAR will hold, and will cause its respective directors, officers, employees, accountants, counsel, financial advisors and other representatives and affiliates to hold, any nonpublic information in confidence.
(b)No investigation pursuant to this Section 5.3 shall affect any representations or warranties of the parties herein or the conditions to the obligations of the parties hereto.
5.4Best Efforts. Upon the terms and subject to the conditions set forth in this Agreement, each of the parties agrees to use its best efforts to take, or cause to be taken, all actions, and to do, or cause to be done, and to assist and cooperate with the other parties in doing, all things necessary, proper or advisable to consummate and make effective, in the most expeditious manner practicable, the Share Exchange and the other transactions contemplated by this Agreement. RDAR and Acquired Company shall mutually cooperate in order to facilitate the achievement of the benefits reasonably anticipated from the Share Exchange.
5.5Public Announcements. RDAR, on the one hand, and Acquired Company, on the other hand, will consult with each other before issuing, and provide each other the opportunity to review and comment upon, any press release or other public statements with respect to the transactions contemplated by this Agreement and shall not issue any such press release or make any such public statement prior to such consultation, except as may be required by applicable law or court process. The parties agree that the initial press release or releases to be issued with respect to the transactions contemplated by this Agreement shall be mutually agreed upon prior to the issuance thereof.
5.6Expenses. All costs and expenses incurred in connection with this Agreement and the transactions contemplated hereby shall be paid by the party incurring such expenses.
5.7No Solicitation. Except as previously agreed to in writing by the other party, neither Acquired Company nor RDAR shall authorize or permit any of its officers, directors, agents, representatives, or advisors to solicit, initiate or encourage or take any action to facilitate the submission of inquiries, proposals or offers from any person relating to any matter concerning any exchange, merger, consolidation, business combination, recapitalization or similar transaction involving Acquired Company or RDAR, respectively, other than the transaction contemplated by this Agreement or any other transaction the consummation of which would or could reasonably be expected to impede, interfere with, prevent or delay the Share Exchange or which would or could be expected to dilute the benefits to either Acquired Company or RDAR of the transactions contemplated hereby. Acquired Company or RDAR will immediately cease and cause to be terminated any existing activities, discussions and negotiations with any parties conducted heretofore with respect to any of the foregoing.
Article VI.
Conditions Precedent and Conditions Subsequent
6.1Conditions to Each Party’s Obligation to Effect the Share Exchange. The obligation of each party to effect the Share Exchange and otherwise consummate the transactions contemplated by this Agreement is subject to the satisfaction, at or prior to the Closing, of each of the following conditions:
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(a)No Restraints. No temporary restraining order, preliminary or permanent injunction or other order preventing the consummation of the Share Exchange shall have been issued by any court of competent jurisdiction or any other Governmental Entity having jurisdiction and shall remain in effect, and there shall not be any applicable legal requirement enacted, adopted or deemed applicable to the Share Exchange that makes consummation of the Share Exchange illegal.
(b)Governmental Approvals.
(1)As to RDAR and Acquired Company. All authorizations, consents, orders, declarations or approvals of, or filings with, or terminations or expirations of waiting periods imposed by, any governmental entity having jurisdiction which the failure to obtain, make or occur would have a material adverse effect on RDAR or Acquired Company shall have been obtained, made or occurred.
(2)As to the Owner. All required approvals required by local rules and regulations, stock market rules and regulations and corporate governance requirements, including the issuance of any and all required communications with respect thereto, as well as all other authorizations, consents, orders, declarations or approvals of, or filings with, or terminations or expirations of waiting periods imposed by, any governmental entity having jurisdiction which the failure to obtain, make or occur would have a material adverse effect on the Owner shall have been obtained, made or occurred.
(c)No Litigation. There shall not be pending or threatened any suit, action or proceeding before any court, Governmental Entity or authority (1) pertaining to the transactions contemplated by this Agreement or (2) seeking to prohibit or limit the ownership or operation by Acquired Company or RDAR, or to dispose of or hold separate any material portion of the business or assets of Acquired Company or RDAR.
6.2Conditions Precedent to Obligations of RDAR. The obligation of RDAR to effect the Share Exchange and otherwise consummate the transactions contemplated by this Agreement are subject to the satisfaction, at or prior to the Closing, of each of the following conditions:
(a)Representations, Warranties and Covenants. The representations and warranties of Acquired Company in this Agreement shall be true and correct in all material respects (except for such representations and warranties that are qualified by their terms by a reference to materiality or material adverse effect, which representations and warranties as so qualified shall be true and correct in all respects) both when made and on and as of the Closing Date, and Acquired Company shall have performed and complied in all material respects with all covenants, obligations and conditions of this Agreement required to be performed and complied with by each of them prior to the Effective Time.
(b)Consents. RDAR shall have received evidence, in form and substance reasonably satisfactory to it, that such licenses, permits, consents, approvals, authorizations, qualifications and orders of governmental authorities and other third parties as necessary in connection with the transactions contemplated hereby have been obtained.
(c)No Material Adverse Change. There shall not have occurred any change in the business, condition (financial or otherwise), results of operations or assets (including intangible assets) and properties of Acquired Company that, individually or in the aggregate, could reasonably be expected to have a material adverse effect on Acquired Company.
(d)Board Resolutions. RDAR shall have received resolutions duly adopted by Acquired
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Company’s board of directors approving the execution, delivery, and performance of the Agreement and the transactions contemplated by the Agreement.
(e)Other Approvals. RDAR shall have received from the Owner written confirmation of its having obtained any and all approvals relating to this Agreement as may be required by the securities laws of the French Republic, including the rules and regulations promulgated thereunder.
(f)Due Diligence Investigation. RDAR shall be reasonably satisfied with the results of its due diligence investigation of Acquired Company in its sole and absolute discretion.
6.3Conditions Precedent to Obligation of Acquired Company. The obligation of Acquired Company to effect the Share Exchange and otherwise consummate the transactions contemplated by this Agreement is subject to the satisfaction, at or prior to the Closing, of each of the following conditions:
(a)Representations, Warranties and Covenants. The representations and warranties of RDAR in this Agreement shall be true and correct in all material respects (except for such representations and warranties that are qualified by their terms by a reference to materiality or material adverse effect, which representations and warranties as so qualified shall be true and correct in all respects) both when made and on and as of the Closing Date, and RDAR shall have performed and complied in all material respects with all covenants, obligations and conditions of this Agreement required to be performed and complied with by it prior to the Effective Time.
(b)Consents. Acquired Company shall have received evidence, in form and substance reasonably satisfactory to it, that such licenses, permits, consents, approvals, authorizations, qualifications and orders of governmental authorities and other third parties as necessary in connection with the transactions contemplated hereby have been obtained.
(c)No Material Adverse Change. There shall not have occurred any change in the business, condition (financial or otherwise), results of operations or assets (including intangible assets) and properties of RDAR that, individually or in the aggregate, could reasonably be expected to have a material adverse effect on RDAR.
(d)Board Resolutions. Acquired Company shall have received resolutions duly adopted by RDAR’s board of directors approving the execution, delivery and performance of the Agreement and the transactions contemplated by the Agreement.
(e)Other Approvals. Acquired Company shall have received from the Owner written confirmation of its having obtained any and all approvals relating to this Agreement as may be required by the securities laws of the French Republic, including the rules and regulations promulgated thereunder.
(f)Due Diligence Investigation. Acquired Company shall be reasonably satisfied with the results of its due diligence investigation of RDAR in its sole and absolute discretion.
6.4Conditions Subsequent.
(a)Regulation A Offering. Should RDAR fail to have filed an Offering Statement on Form 1-A pursuant to Regulation A of the Securities and Exchange Commission (the “Reg A Offering”), on or before the 20th day following the Closing, the Owner shall have the right, but not the obligation, to rescind this Agreement by written notice to RDAR.
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(b)Regulation A Offering Proceeds. Should RDAR fail to have obtained the sum of $1,500,000 in proceeds from the Reg A Offering, on or before the date that is six (6) months from the date of the SEC’s qualification of the Reg A Offering, the Members shall have the right, but not the obligation, to rescind this Agreement by unanimous written notice to RDAR (the “Rescission Notice”). Upon RDAR’s receipt of the Rescission Notice, this Agreement shall, ipso facto, be rescinded and the Parties returned to their statuses quo ante.
(c)Divestiture. Should RDAR fail to have divested of its current operations, which divestiture shall include all debts, other than the trade payables of RDAR listed on Exhibit D attached hereto and incorporated herein, of RDAR as of the Closing Date, on or before December 31, 2024, the Owner shall have the right, but not the obligation, to rescind this Agreement by written notice to RDAR.
Article VII.
Closing
7.1RDAR shall make the following deliveries at the Closing. To consummate the transaction, RDAR shall, at the Closing, make the following deliveries:
(a)Executed Closing Certificate, in the form of Exhibit E attached hereto;
(b)Executed written consent of the Board of Directors or RDAR authorizing each of the Change-in-Control Agreement, including this Agreement, and the issuance of the Exchange Shares;
(c)A fully executed Mexedia Ireland SPA;
(d)A fully executed Redemption Agreement; and
(e)The Exchange Shares, in the form of the Exchange Shares Certificate.
7.2Acquired Company and the Owner shall make the following deliveries at the Closing. To consummate the transaction Acquired Company and the Owner shall, at Closing, make the following deliveries:
(a)Executed Closing Certificate, in the form of Exhibit F attached hereto;
(b)A fully executed Mexedia Ireland SPA; and
(c)The Ownership Interest, duly assigned to RDAR.
Article VIII.
Termination, Amendment and Waiver
8.1Termination. This Agreement may be terminated and abandoned at any time prior to the Effective Time of the Share Exchange:
(a)by mutual written consent of RDAR and Acquired Company;
(b)by either RDAR or Acquired Company if any Governmental Entity shall have issued an order, decree or ruling or taken any other action permanently enjoining, restraining or otherwise prohibiting the Share Exchange and such order, decree, ruling or other action shall have become final and non-appealable;
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(c)by either RDAR or Acquired Company if the Share Exchange shall not have been consummated on or before January 31, 2025 (other than as a result of the failure of the party seeking to terminate this Agreement to perform its obligations under this Agreement required to be performed at or prior to the Effective Time).
(d)by RDAR, if a material adverse change shall have occurred relative to Acquired Company (and not curable within 10 days);
(e)by Acquired Company if a material adverse change shall have occurred relative to RDAR (and not curable within thirty 10 days);
(f)by RDAR, if Acquired Company willfully fails to perform in any material respect any of its material obligations under this Agreement; or
(g)by Acquired Company, if RDAR willfully fails to perform in any material respect any of its obligations under this Agreement.
8.2Effect of Termination. In the event of termination of this Agreement by either Acquired Company or RDAR as provided in Section 8.1, this Agreement shall forthwith become void and have no effect, without any liability or obligation on the part of RDAR or Acquired Company, other than the provisions of this Section 8.2. Nothing contained in this Section 8.2 shall relieve any party for any breach of the representations, warranties, covenants or agreements set forth in this Agreement.
8.3Amendment. This Agreement may not be amended except by an instrument in writing signed on behalf of each of the parties upon approval by the party, if such party is an individual, and upon approval of the Board of Director of RDAR and of Acquired Company.
8.4Extension; Waiver. Subject to Section 8.1(c), at any time prior to the Effective Time, the parties may (a) extend the time for the performance of any of the obligations or other acts of the other parties, (b) waive any inaccuracies in the representations and warranties contained in this Agreement or in any document delivered pursuant to this Agreement, or (c) waive compliance with any of the agreements or conditions contained in this Agreement. Any agreement on the part of a party to any such extension or waiver shall be valid only if set forth in an instrument in writing signed on behalf of such party. The failure of any party to this Agreement to assert any of its rights under this Agreement or otherwise shall not constitute a waiver of such rights.
8.5Return of Documents. In the event of termination of this Agreement for any reason, RDAR and Acquired Company will return to the other party all of the other party’s documents, work papers, and other materials (including copies) relating to the transactions contemplated in this Agreement, whether obtained before or after execution of this Agreement. RDAR and Acquired Company will not use any information so obtained from the other party for any purpose and will take all reasonable steps to have such other party’s information kept confidential.
Article IX.
Indemnification and Related Matters
9.1Survival of Representations and Warranties. The representations and warranties in this Agreement or in any instrument delivered pursuant to this Agreement, including any disclosure schedule, shall
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survive until twelve (12) months after the Effective Time (except for with respect to Taxes, which shall survive for the applicable statute of limitations plus 90 days, and covenants that by their terms survive for a longer period). The right to any remedy based upon such representations and warranties shall not be affected by any investigation conducted with respect to, or any knowledge acquired at any time, whether before or after execution and delivery of this Agreement or the Closing Date, with respect to the accuracy or inaccuracy of any such representation or warranty.
9.2Indemnification.
(a)RDAR shall indemnify and hold Acquired Company and Acquired Company’s officers and directors (“Acquired Company Representatives”) harmless for, from and against any and all liabilities, obligations, damages, losses, deficiencies, costs, penalties, interest and expenses (including, but not limited to, any and all expenses whatsoever reasonably incurred in investigating, preparing or defending against any litigation, commenced or threatened, or any claim whatsoever) (collectively, “Losses”) to which RDAR may become subject resulting from or arising out of any breach of a representation, warranty or covenant made by RDAR as set forth herein.
(b)Acquired Company shall indemnify and hold RDAR and RDAR’s officers and directors (“RDAR’s Representatives”) harmless for, from and against any and all Losses to which RDAR or RDAR’s Representatives may become subject resulting from or arising out of (1) any breach of a representation, warranty or covenant made by Acquired Company as set forth herein; or (2) any and all liabilities arising out of or in connection with: (A) any of the assets of Acquired Company prior to the Closing; or (B) the operations of Acquired Company prior to the Closing.
9.3Notice of Indemnification. Promptly after the receipt by any indemnified party (the “Indemnitee”) of notice of the commencement of any action or proceeding against such Indemnitee, such Indemnitee shall, if a claim with respect thereto is or may be made against any indemnifying party (the “Indemnifying Party”) pursuant to this Article IX, give such Indemnifying Party written notice of the commencement of such action or proceeding and give such Indemnifying Party a copy of such claim and/or process and all legal pleadings in connection therewith. The failure to give such notice shall not relieve any Indemnifying Party of any of its indemnification obligations contained in this Article IX, except where, and solely to the extent that, such failure actually and materially prejudices the rights of such Indemnifying Party. Such Indemnifying Party shall have, upon request within thirty (30) days after receipt of such notice, but not in any event after the settlement or compromise of such claim, the right to defend, at its own expense and by its own counsel reasonably acceptable to the Indemnitee, any such matter involving the asserted liability of the Indemnitee; provided, however, that if the Indemnitee determines that there is a reasonable probability that a claim may materially and adversely affect it, other than solely as a result of money payments required to be reimbursed in full by such Indemnifying Party under this Article IX or if a conflict of interest exists between Indemnitee and the Indemnifying Party, the Indemnitee shall have the right to defend, compromise or settle such claim or suit; and, provided, further, that such settlement or compromise shall not, unless consented to in writing by such Indemnifying Party, which shall not be unreasonably withheld, be conclusive as to the liability of such Indemnifying Party to the Indemnitee. In any event, the Indemnitee, such Indemnifying Party and its counsel shall cooperate in the defense against, or compromise of, any such asserted liability, and in cases where the Indemnifying Party shall have assumed the defense, the Indemnitee shall have the right to participate in the defense of such asserted liability at the Indemnitee’s own expense. In the event that such Indemnifying Party shall decline to participate in or assume the defense of such action, prior to paying or settling any claim against which such Indemnifying Party is, or may be, obligated under this Article IX to indemnify an Indemnitee, the Indemnitee shall first supply such Indemnifying Party with a copy of a final court judgment or decree holding the Indemnitee liable on such claim or, failing such judgment or decree, the terms and conditions of the
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settlement or compromise of such claim. An Indemnitee’s failure to supply such final court judgment or decree or the terms and conditions of a settlement or compromise to such Indemnifying Party shall not relieve such Indemnifying Party of any of its indemnification obligations contained in this Article IX, except where, and solely to the extent that, such failure actually and materially prejudices the rights of such Indemnifying Party. If the Indemnifying Party is defending the claim as set forth above, the Indemnifying Party shall have the right to settle the claim only with the consent of the Indemnitee.
Article X.
General Provisions
10.1Notices. Any and all notices and other communications hereunder shall be in writing and shall be deemed duly given to the party to whom the same is so delivered, sent or mailed at addresses and contact information set forth below (or at such other address for a party as shall be specified by like notice.) Any and all notices or other communications or deliveries required or permitted to be provided hereunder shall be deemed given and effective on the earliest of: (a) on the date of transmission, if such notice or communication is delivered via e-mail at the e-mail address set forth on the signature pages attached hereto prior to 5:30 p.m. (Eastern Time) on a business day, (b) on the next business day after the date of transmission, if such notice or communication is delivered via facsimile at the facsimile number set forth on the signature pages attached hereto on a day that is not a business day or later than 5:30 p.m. (Eastern Time) on any business day, (c) on the second business day following the date of mailing, if sent by a nationally recognized overnight courier service, or (d) if by personal delivery, upon actual receipt by the party to whom such notice is required to be given.
If to RDAR prior to Closing:
7950 East Redfield Road, Unit 210
Scottsdale, AZ 85260
If to Acquired Company:
1680 Michigan Avenue, Suite 700
Miami Beach, Florida 33139
If to the Owner:
Via di Affogalasino, 105 - 00148 Roma RM
10.2Definitions. For purposes of this Agreement:
(a)an “affiliate” of any person means another person that directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with, such first person;
(b)“material adverse change” or “material adverse effect” means, when used in connection with Acquired Company or RDAR, any change or effect that either individually or in the aggregate with all other such changes or effects is materially adverse to the business, assets, properties, condition (financial or otherwise) or results of operations of such party and its subsidiaries taken as a whole (after giving effect in the case of RDAR to the consummation of the Share Exchange);
(c)“person” means an individual, corporation, partnership, joint venture, association, trust, unincorporated organization or other entity; and
(d)a “subsidiary” of any person means another person, an amount of the voting securities, other voting ownership or voting partnership interests of which is sufficient to elect at least a majority of its
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board of Directors or other governing body (or, if there are no such voting interests, fifty percent (50%) or more of the equity interests of which) is owned directly or indirectly by such first person.
10.3Interpretation. When a reference is made in this Agreement to a Section, Exhibit or Schedule, such reference shall be to a Section of, or an Exhibit or Schedule to, this Agreement unless otherwise indicated. The headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement. Whenever the words “include”, “includes” or “including” are used in this Agreement, they shall be deemed to be followed by the words “without limitation.”
10.4Entire Agreement; No Third-Party Beneficiaries. This Agreement and the other agreements referred to herein constitute the entire agreement, and supersede all prior agreements and understandings, both written and oral, among the parties with respect to the subject matter of this Agreement. This Agreement is not intended to confer upon any person other than the parties any rights or remedies.
10.5Governing Law. This Agreement shall be governed by, and construed in accordance with, the laws of the State of Nevada, regardless of the laws that might otherwise govern under applicable principles of conflicts of laws thereof.
10.6Assignment. Neither this Agreement nor any of the rights, interests or obligations under this Agreement shall be assigned, in whole or in part, by operation of law or otherwise by any of the parties without the prior written consent of the other parties. Subject to the preceding sentence, this Agreement will be binding upon, inure to the benefit of, and be enforceable by, the parties and their respective successors and assigns.
10.7Enforcement. The parties agree that irreparable damage would occur in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached. It is accordingly agreed that the parties shall be entitled to an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions of this Agreement in any court of the United States located in the State of Nevada, this being in addition to any other remedy to which they are entitled at law or in equity. In addition, each of the parties hereto (a) agrees that it will not attempt to deny or defeat such personal jurisdiction or venue by motion or other request for leave from any such court, and (b) agrees that it will not bring any action relating to this Agreement or any of the transactions contemplated by this Agreement in any state court other than such court.
10.8Severability. Whenever possible, each provision or portion of any provision of this Agreement will be interpreted in such manner as to be effective and valid under applicable law but if any provision or portion of any provision of this Agreement is held to be invalid, illegal or unenforceable in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability will not affect any other provision or portion of any provision in such jurisdiction, and this Agreement will be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision or portion of any provision had never been contained herein.
10.9Counterparts. This Agreement may be executed simultaneously in two or more counterparts, any one of which need not contain the signatures of more than one party, but all such counterparts taken together will constitute one and the same Agreement. This Agreement, to the extent delivered by means of a facsimile machine or electronic mail (any such delivery, an “ Electronic Delivery “), shall be treated in all manner and respects as an original agreement or instrument and shall be considered to have the same binding legal effect as if it were the original signed version thereof delivered in person. At the request of any party hereto, each other party hereto shall re-execute original forms hereof and deliver them in person to all other parties. No party hereto shall raise the use of Electronic Delivery to deliver a signature or the fact that any
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signature or agreement or instrument was transmitted or communicated through the use of Electronic Delivery as a defense to the formation of a contract, and each such party forever waives any such defense, except to the extent such defense related to lack of authenticity.
10.10Attorneys’ Fees. In the event any suit or other legal proceeding is brought for the enforcement of any of the provisions of this Agreement, the parties hereto agree that the prevailing party or parties shall be entitled to recover from the other party or parties upon final judgment on the merits reasonable attorneys’ fees, including attorneys’ fees for any appeal, and costs incurred in bringing such suit or proceeding.
[ SIGNATURE PAGE FOLLOWS ]
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[ SIGNATURE PAGE TO SHARE EXCHANGE AGREEMENT ]
IN WITNESS WHEREOF, the undersigned have caused their duly authorized officers to execute this Agreement as of the date first above written.
RDAR:ACQUIRED COMPANY:
RAADR, INC.MEXEDIA INC.
By: /s/ Jacob DiMartinoBy: /s/ Orlando Taddeo
Jacob DiMartinoOrlando Taddeo
Chief Executive OfficerPresident
E-Mail: jacob.d@raadr.comE-Mail: otaddeo@mexedia.com
OWNER:
MEXEDIA S.p.A. S.B.
By: /s/ Orlando Taddeo
Orlando Taddeo
President
E-Mail: otaddeo@mexedia.com
MEXEDIA, INC. SHARE EXCHANGE AGREEMENT | PAGE 25
EXHIBIT A
Certificate of Designation of Series F Preferred Stock
TERMS OF SERIES F PREFERRED STOCK
Section 1. Designation, Amount and Par Value. The series of Preferred Stock shall be designated as Series F Preferred Stock (the “Series F Preferred Stock”) and the number of shares so designated shall be Seventy-Five Thousand (75,000). Each share of the Series F Preferred Stock shall have a par value of $0.001.
Section 2. Fractional Shares. The Series F Preferred Stock may be issued in fractional shares.
Section 3. Voting Rights. The holders of the Series F Preferred Stock shall, as a class, have rights in all matters requiring shareholder approval to a number of votes equal to two (2) times the sum of:
(a)The total number of shares of Company common stock (the “Common Stock”) which are issued and outstanding at the time of any election or vote by the shareholders; plus
(b)The number of votes allocated to shares of Preferred Stock issued and outstanding of any other class that shall have voting rights.
Section 4. Dividends. The holders of the Series F Preferred Stock shall not be entitled to receive dividends paid on the Common Stock.
Section 5. Liquidation. The holders of the Series F Preferred Stock shall not be entitled to any liquidation preference.
Section 6. Conversion and Adjustments.
(a)Conversion Rate. The Series F Preferred Stock shall be convertible into shares of the Company’s common stock, as follows:
Each share of Series F Preferred Stock shall be convertible at any time into a number of shares of Common Stock that equals one-thousandth of one percent (0.001%) of the number of issued and outstanding shares of the Common Stock outstanding on the date of conversion, such that 1,000 shares of Series F Preferred Stock would convert into one percent (1%) of the number of issued and outstanding shares of the Common Stock outstanding on the date of conversion (the “Conversion Rate”).
(b)No Partial Conversion. A holder of shares of Series F Preferred Stock shall be required to convert all of such holder’s shares of Series F Preferred Stock, should any such holder exercise his, her or its rights of conversion.
(c)Adjustment for Merger and Reorganization, etc. If there shall occur any reorganization, recapitalization, reclassification, consolidation or merger (a “Reorganization Event”) involving the Company in which the Common Stock (but not the Series F Preferred Stock) is converted into or exchanged for securities, cash or other property, then each share of Series F Preferred Stock shall be deemed to have been converted into shares of the Common Stock at the Conversion Rate.
Section 7. Protection Provisions. So long as any shares of Series F Preferred Stock are outstanding, the Company shall not, without first obtaining the majority written consent of the holders of Series F Preferred Stock, alter or change the rights, preferences or privileges of the Series F Preferred Stock so as to affect adversely the holders of Series F Preferred Stock.
Section 8. Waiver. Any of the rights, preferences or privileges of the holders of the Series F Preferred Stock may be waived by the affirmative consent or vote of the holders of at least a majority of the shares of Series F Preferred Stock then outstanding.
Section 9. No Other Rights or Privileges. Except as specifically set forth herein, the holder(s) of the shares of Series F Preferred Stock shall have no other rights, privileges or preferences with respect to the Series F Preferred Stock.
MEXEDIA, INC. SHARE EXCHANGE AGREEMENT | PAGE 26
EXHIBIT B
Form of Mexedia Ireland SPA
SHARE EXCHANGE AGREEMENT
This Share Exchange Agreement (this “Agreement”) is entered into as of this ____ day of September, 2024, by and among Raadr, Inc., a Nevada corporation (“RDAR”), Mexedia DAC, a Republic of Ireland corporation (“Acquired Company”), and Mexedia S.p.A. S.B., the owner of Acquired Company (the “Owner”).
RECITALS
WHEREAS, this Agreement is one of a series of agreements that would, when consummated, result in the Company’s (a) having acquired businesses and assets valued in excess of USD$60,000,000 and (b) having undergone a change in control (collectively, the “Change-in-Control Agreements”); and
WHEREAS, the Boards of Directors of RDAR, Acquired Company and the Owner have determined that an acquisition of all of the issued and outstanding shares of capital stock of Acquired Company by RDAR through a share exchange upon the terms and subject to the conditions set forth in this Agreement (the “Share Exchange”) would be in the best interests of RDAR, Acquired Company and the Owner; and
WHEREAS, and the Boards of Directors of RDAR and Acquired Company have each approved the Share Exchange; and
WHEREAS, this Agreement is under consideration by the Board of Directors of the Owner for formal determination and approval; and
WHEREAS, pursuant to the Share Exchange, all of the right, title and interest in and to all of the issued and outstanding shares of capital stock of Acquired Company (the “Ownership Interest”) will be exchanged for 30,000 shares of Series F Preferred Stock of RDAR, the Certificate of Designation of which is attached hereto as Exhibit A, including the common stock into which such shares may be converted (the “Exchange Shares”); and
WHEREAS, RDAR, Acquired Company and the Owner desire to make certain representations, warranties, covenants and agreements in connection with the Share Exchange and also to prescribe various conditions to the Share Exchange.
NOW, THEREFORE, in consideration of the representations, warranties, covenants and agreements contained in this Agreement, the parties agree as follows:
Article I.
The Exchange
1.1Share Exchange. Upon the terms and subject to the conditions set forth in this Agreement, and in accordance with the Nevada Revised Statutes (the “Nevada Statutes”), at the Closing (defined below), the parties shall do the following:
(a)Acquired Company shall cause the Owner to convey, assign and transfer the Ownership Interest to RDAR by delivering to RDAR duly executed assignments in proper form for transfer. The Ownership Interest transferred to RDAR at the Closing shall constitute 100% of the issued and outstanding shares of capital stock of Acquired Company.
(b)As consideration for its acquisition of the Ownership Interest, RDAR shall issue the Exchange Shares to the Owner by delivering a book entry record to the Owner evidencing the Exchange Shares (the “Exchange Shares Certificate”).
1.2Closing. Unless this Agreement shall have been terminated and the transactions herein contemplated shall have been abandoned pursuant to Article VIII, the closing date of the Exchange (the “Closing”) will take place on the business day upon satisfaction of the conditions set forth in Article VI (or as soon as practicable thereafter following satisfaction or waiver of the conditions set forth in Article VI) (the “Closing Date”), at such time and location as may be agreed upon by RDAR and Acquired Company; provided, however, that the Closing shall take place no later than January 31, 2025.
1.3Reorganization.
(a)As of the Closing, Jacob DiMartino shall resign as RDAR’s sole director and officer and Orlando Taddeo shall be appointed as the sole director and officer of RDAR.
(b)If at any time after the Closing, any party shall consider that any further deeds, assignments, conveyances, agreements, documents, instruments or assurances in law or any other things are necessary or desirable to vest, perfect, confirm or record in RDAR the title to any property, rights, privileges, powers and franchises of Acquired Company by reason of, or as a result of, the Share Exchange, or otherwise to carry out the provisions of this Agreement, the remaining parties, as applicable, shall execute and deliver, upon request, any instruments or assurances, and do all other things necessary or proper to vest, perfect, confirm or record title to such property, rights, privileges, powers and franchises in RDAR, and otherwise to carry out the provisions of this Agreement.
Article II.
Compliance with Applicable Securities Laws
2.1Covenants, Representations and Warranties of the Owner.
(a)The Owner acknowledges and agrees that it is acquiring the Exchange Shares for investment purposes and will not offer, sell or otherwise transfer, pledge or hypothecate any of the Exchange Shares issued to them (other than pursuant to an effective Registration Statement under the Securities Act of 1933, as amended (the “Securities Act”)), directly or indirectly unless:
(1)the sale is to RDAR; or
(2)the Exchange Shares are sold in a transaction that does not require registration under the Securities Act, or any applicable United States state laws and regulations governing the offer and sale of securities, and the seller has furnished to RDAR an opinion of counsel to that effect or such other written opinion as may be reasonably required by RDAR.
(b)The Owner acknowledges and agrees that the book entry record representing the Exchange Shares shall bear a restrictive legend, substantially in the following form:
“THE SECURITIES REPRESENTED BY THIS STOCK CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”) OR APPLICABLE STATE SECURITIES LAWS, AND SHALL NOT BE SOLD, PLEDGED, HYPOTHECATED, DONATED, OR OTHERWISE TRANSFERRED (WHETHER OR NOT FOR CONSIDERATION) BY THE HOLDER EXCEPT UPON THE ISSUANCE TO THE COMPANY OF A FAVORABLE OPINION OF ITS COUNSEL OR THE SUBMISSION TO THE COMPANY OF SUCH OTHER EVIDENCE AS MAY BE SATISFACTORY TO COUNSEL FOR THE COMPANY, TO THE EFFECT THAT ANY SUCH TRANSFER SHALL NOT BE IN VIOLATION OF THE SECURITIES ACT OR APPLICABLE STATE SECURITIES LAWS.”
(c)The Owner represents and warrants that it:
(1)is not aware of any advertisement of, or other form or general solicitation with respect to, any of the Exchange Shares being issued hereunder;
(2)acknowledges and agrees that RDAR will refuse to register any transfer of the Exchange Shares not made pursuant to an effective registration statement under the Securities Act or pursuant to an available exemption from the registration requirements of the Securities Act and in accordance with applicable state and provincial securities laws; and
(3)acknowledges and agrees to RDAR making a notation on its records or giving instructions to the registrar and transfer agent of RDAR in order to implement the restrictions on transfer set forth and described herein.
Article III.
Representations and Warranties
3.1Representations and Warranties of Acquired Company and the Owner. As a material inducement for RDAR to enter into this Agreement and to consummate the transactions contemplated hereby, Acquired Company and the Owner hereby make the following representations and warranties as of the date hereof and as of the Closing Date, each of which is relied upon by RDAR regardless of any investigation made or information obtained by RDAR (unless and to the extent specifically and expressly waived in writing by RDAR on or before the Closing Date):
(a)Organization, Standing and Power; No Disability. Acquired Company is duly organized, validly existing and in good standing under the laws of the Republic of Ireland. The Owner is duly organized, validly existing and in good standing under the laws of its organization.
(b)Subsidiaries. Acquired Company does not own, directly or indirectly, any equity or other ownership interest in any company, corporation, partnership, joint venture or otherwise.
(c)Corporate Documents. Schedule 3.1(c) contains true and correct copies of the Articles of Incorporation and bylaws of Acquired Company, each as amended to date.
(d)Ownership Interest. The Ownership Interest represents 100% of the issued and outstanding shares of capital stock of
Acquired Company. Acquired Company also warrants that there are no outstanding bonds, debentures, notes or other indebtedness or other securities of Acquired Company. There are no rights, commitments, agreements, arrangements or undertakings of any kind to which Acquired Company is a party or by which it is bound obligating Acquired Company to issue, deliver or sell, or cause to be issued, delivered or sold, additional ownership interests of Acquired Company or obligating Acquired Company to issue, grant, extend or enter into any such right, commitment, agreement, arrangement or undertaking. There are no outstanding contractual obligations, commitments, understandings or arrangements of Acquired Company to repurchase, redeem or otherwise acquire or make any payment in respect of the capital stock of Acquired Company.
(e)Capitalization of Acquired Company. Schedule 3(e) sets forth the issued and outstanding shares of capital stock of Acquired Company (the Ownership Interest). All of Acquired Company’s issued and outstanding shares of capital stock have been duly authorized, are validly issued, fully paid and non-assessable.
(f)Authority; Non-contravention. Acquired Company and the Owner have all requisite power and authority to enter into this Agreement and to consummate the transactions contemplated by this Agreement. The execution and delivery of this Agreement by Acquired Company and its Owner and the consummation by Acquired Company and the Owner of the transactions contemplated hereby have been (or at Closing will have been) duly authorized by all necessary action on the part of Acquired Company. This Agreement has been duly executed and when delivered by Acquired Company and the Owner shall constitute a valid and binding obligation of Acquired Company and the Owner, enforceable against Acquired Company and the Owner, as applicable, in accordance with its terms, except as such enforcement may be limited by bankruptcy, insolvency or other similar laws affecting the enforcement of creditors’ rights generally or by general principles of equity. The execution and delivery of this Agreement does not, and the consummation of the transactions contemplated by this Agreement and compliance with the provisions hereof will not, conflict with, or result in any breach or violation of, or default (with or without notice or lapse of time, or both) under, or give rise to a right of termination, cancellation or acceleration of or “put” right with respect to any obligation or to a loss of a material benefit under, or result in the creation of any lien upon any of the properties or assets of Acquired Company under, (1) the articles of incorporation or bylaws of Acquired Company, (2) any loan or credit agreement, note, bond, mortgage, indenture, lease or other agreement, instrument, permit, concession, franchise or license applicable to Acquired Company, its properties or assets, or (3) subject to the governmental filings and other matters referred to in the following sentence, any judgment, order, decree, statute, law, ordinance, rule, regulation or arbitration award applicable to Acquired Company, its properties or assets, other than, in the case of clauses (ii) and (iii), any such conflicts, breaches, violations, defaults, rights, losses or liens that individually or in the aggregate could not have a material adverse effect with respect to Acquired Company or could not prevent, hinder or materially delay the ability of Acquired Company to consummate the transactions contemplated by this Agreement.
(g)Governmental Authorization. No consent, approval, order or authorization of, or registration, declaration or filing with, or notice to, any United States court, administrative agency or commission, or other federal, state or local government or other governmental authority, agency, domestic or foreign (a “Governmental Entity”), is required by or with respect to Acquired Company in connection with the execution and delivery of this Agreement by Acquired Company or the consummation by Acquired Company of the transactions contemplated hereby, except, with respect to this Agreement, any filings under the Securities Act or the Securities Exchange Act of 1934 and the rules and regulations promulgated thereunder (the “Exchange Act”) or pursuant to the rules of OTC Markets.
(h)Financial Statements.
(1)At Closing, RDAR will have received from Acquired Company a copy of its unaudited financial statements for the years ended December 31, 2023 and 2022, and for the six months ended June 30, 2024 (collectively, the “Acquired Company Financial Statements”). The Acquired Company Financial Statements fairly present the financial condition of Acquired Company at the dates indicated and its results of operations and cash flows for the periods then ended and, except as indicated therein, reflect all claims, debts and liabilities of Acquired Company, fixed or contingent, and of whatever nature.
(2)Since June 30, 2024, there has been no material adverse change in the assets or liabilities, or in the business or condition, financial or otherwise, or in the results of operations or prospects, of Acquired Company, whether as a result of any legislative or regulatory change, revocation of any license or rights to do business, fire, explosion, accident, casualty, labor trouble, flood, drought, riot, storm, condemnation, act of God, public force or otherwise and no material adverse change in the assets or liabilities, or in the business or condition, financial or otherwise, or in the results of operation or prospects, of Acquired Company except in the ordinary course of business.
(3)Since June 30, 2024, Acquired Company has not issued, sold or otherwise disposed of, or agreed to issue, sell or otherwise dispose of, any securities of Acquired Company, and has not granted or agreed to grant any other right to subscribe for or to purchase any securities of Acquired Company or has incurred or agreed to incur any indebtedness for borrowed money.
(i)Absence of Certain Changes or Events. Since June 30, 2024, Acquired Company has conducted its business only in the ordinary course consistent with past practice, and there is not and has not been any:
(1)material adverse change with respect to Acquired Company including any amendments to its formation and governance documents;
(2)event which, if it had taken place following the execution of this Agreement, would not have been permitted by Section 4.1 without prior consent of RDAR;
(3)condition, event or occurrence which could reasonably be expected to prevent, hinder or materially delay the ability of Acquired Company to consummate the transactions contemplated by this Agreement;
(4)incurrence, assumption or guarantee by Acquired Company of any indebtedness for borrowed money other than in the ordinary course and in amounts and on terms consistent with past practices or as disclosed to RDAR in writing;
(5)creation or other incurrence by Acquired Company of any lien on any asset other than in the ordinary course consistent with past practices;
(6)transaction or commitment made, or any contract or agreement entered into, by Acquired Company relating to its assets or business (including the acquisition or disposition of any assets) or any relinquishment by Acquired Company of any contract or other right, in either case, material to Acquired Company, other than transactions and commitments in the ordinary course consistent with past practices and those contemplated by this Agreement;
(7)labor dispute, other than routine, individual grievances, or, to the knowledge of Acquired Company, any activity or proceeding by a labor union or representative thereof to organize any employees of Acquired Company or any lockouts, strikes, slowdowns, work stoppages or threats by or with respect to such employees;
(8)payment, prepayment or discharge of liability other than in the ordinary course of business or any failure to pay any liability when due;
(9)write-offs or write-downs of any assets of Acquired Company;
(10)creation, termination or amendment of, or waiver of any right under, any material contract of Acquired Company;
(11)damage, destruction or loss having, or reasonably expected to have, a material adverse effect on Acquired Company;
(12)other condition, event or occurrence which individually or in the aggregate could reasonably be expected to have a material adverse effect or give rise to a material adverse change with respect to Acquired Company; or
(13)agreement or commitment to do any of the foregoing.
(j)Certain Fees. No brokerage or finder’s fees or commissions are or will be payable by Acquired Company to any broker, financial advisor or consultant, finder, placement agent, investment banker, bank or other person with respect to the transactions contemplated by this Agreement.
(k)Litigation; Labor Matters; Compliance with Laws.
(1)Except as set forth in Schedule 3(k)(1), there is no suit, action or proceeding or investigation pending or, to the knowledge of Acquired Company, threatened against or affecting Acquired Company or any basis for any such suit, action, proceeding or investigation that, individually or in the aggregate, could reasonably be expected to have a material adverse effect with respect to Acquired Company or prevent, hinder or materially delay the ability of Acquired Company to consummate the transactions contemplated by this Agreement, nor is there any judgment, decree, injunction, rule or order of any governmental entity or arbitrator outstanding against Acquired Company having, or which, insofar as reasonably could be foreseen by Acquired Company, in the future could have, any such effect.
(2)Acquired Company is not a party to, or bound by, any collective bargaining agreement, contract or other agreement or understanding with a labor union or labor organization, nor is it the subject of any proceeding asserting that it has committed an unfair labor practice or seeking to compel it to bargain with any labor organization as to wages or conditions of employment nor is there any strike, work stoppage or other labor dispute involving it pending or, to its knowledge, threatened, any of which could have a material adverse effect with respect to Acquired Company.
(3)The conduct of the business of Acquired Company complies with all statutes, laws, regulations, ordinances, rules, judgments, orders, decrees or arbitration awards applicable thereto.
(l)Benefit Plans. Acquired Company is not a party to any Benefit Plan under which Acquired Company currently has an obligation to provide benefits to any current or former employee, officer or director of Acquired Company. As used herein, “Benefit Plan” shall mean any employee benefit plan, program, or arrangement of any kind, including any defined benefit or defined contribution plan, ownership plan with respect to any membership interest, executive compensation program or arrangement, bonus plan, incentive compensation plan or arrangement, profit sharing plan or arrangement, deferred compensation plan, agreement or arrangement, supplemental retirement plan or arrangement, vacation pay, sickness, disability, or death benefit plan (whether provided through insurance, on a funded or unfunded basis, or otherwise), medical or life insurance plan providing benefits to employees, retirees, or former employees or any of their dependents, survivors, or beneficiaries, severance pay, termination, salary continuation, or employee assistance plan.
(m)Tax Returns and Tax Payments.
(1)Acquired Company has timely filed with the appropriate taxing authorities all Tax Returns, as that term is
hereinafter defined, required to be filed by it (taking into account all applicable extensions). All such Tax Returns are true, correct and complete in all respects. All Taxes, as that term is hereinafter defined, due and owing by Acquired Company have been paid (whether or not shown on any Tax Return and whether or not any Tax Return was required). Acquired Company is not currently the beneficiary of any extension of time within which to file any Tax Return or pay any Tax. No claim has ever been made in writing or otherwise addressed to Acquired Company by a taxing authority in a jurisdiction where Acquired Company does not fileTax Returns that it is or may be subject to taxation by that jurisdiction. Since inception, Acquired Company has not incurred any liability for Taxes outside the ordinary course of business consistent with past custom and practice.
(2)No material claim for unpaid Taxes has been made or become a lien against the property of Acquired Company or is being asserted against Acquired Company, no audit of any Tax Return of Acquired Company is being conducted by a tax authority, and no extension of the statute of limitations on the assessment of any Taxes has been granted by Acquired Company and is currently in effect. Acquired Company has withheld and paid all Taxes required to have been withheld and paid in connection with amounts paid or owing to any employee, independent contractor, creditor, stockholder or other third party.
(3)As used herein, “Taxes” shall mean all taxes of any kind, including, without limitation, those on or measured by or referred to as income, gross receipts, sales, use, ad valorem, franchise, profits, license, withholding, payroll, employment, excise, severance, stamp, occupation, premium value added, property or windfall profits taxes, customs, duties or similar fees, assessments or charges of any kind whatsoever, together with any interest and any penalties, additions to tax or additional amounts imposed by any governmental authority, domestic or foreign. As used herein, “ Tax Return “ shall mean any return, report or statement required to be filed with any governmental authority with respect to Taxes.
(n)Environmental Matters. Acquired Company is in compliance with all Environmental Laws in all material respects. Acquired Company has not received any written notice regarding any violation of any Environmental Laws, as that term is hereinafter defined, including any investigatory, remedial or corrective obligations. Acquired Company holds all permits and authorizations required under applicable Environmental Laws, unless the failure to hold such permits and authorizations would not have a material adverse effect on Acquired Company, and is in compliance with all terms, conditions and provisions of all such permits and authorizations in all material respects. No releases of Hazardous Materials, as that term is hereinafter defined, have occurred at, from, in, to, on or under any real property currently or formerly owned, operated or leased by Acquired Company or any predecessor thereof and no Hazardous Materials are present in, on, about or migrating to or from any such property which could result in any liability to Acquired Company. Acquired Company has not transported or arranged for the treatment, storage, handling, disposal, or transportation of any Hazardous Material to any off-site location which could result in any liability to Acquired Company. Acquired Company has no liability, absolute or contingent, under any Environmental Law that if enforced or collected would have a material adverse effect on Acquired Company. There are no past, pending or threatened claims under Environmental Laws against Acquired Company and Acquired Company is not aware of any facts or circumstances that could reasonably be expected to result in a liability or claim against Acquired Company pursuant to Environmental Laws. “Environmental Laws” means all applicable foreign, federal, state and local statutes, rules, regulations, ordinances, orders, decrees and common law relating in any manner to contamination, pollution or protection of human health or the environment, and similar state laws. “Hazardous Material” means any toxic, radioactive, corrosive or otherwise hazardous substance, including petroleum, its derivatives, by-products and other hydrocarbons, or any substance having any constituent elements displaying any of the foregoing characteristics, which in any event is regulated under any Environmental Law.
(o)Material Contracts. All Material Contracts copies of which have been furnished to RDAR. Acquired Company is not, or has not received any notice or has any knowledge that any other party is, in default in any respect under any Material Contract, as that term is hereinafter defined; and there has not occurred any event that with the lapse of time or the giving of notice or both would constitute such a material default.
For purposes of this Agreement, a “Material Contract” means any contract, agreement or commitment that is effective as of the Closing Date to which Acquired Company is a party (1) with expected receipts or expenditures in an amount in excess of two percent (2%) of Acquired Company’s gross revenues for the 12 months ended July 31, 2025, (2) requiring Acquired Company to indemnify any person in an amount that is expected to exceed ten percent (10%) of Acquired Company’s owners’ equity as of the date of Closing, (3) granting exclusive rights to any party, (4) evidencing indebtedness for borrowed or loaned money in an amount in excess of ten percent (10%) of Acquired Company’s owners’ equity, including guarantees of such indebtedness, as of the date of Closing, or (5) which, if breached by Acquired Company in such a manner would (A) permit any other party to cancel or terminate the same (with or without notice of passage of time) or (B) provide a basis for any other party to claim money damages (either individually or in the aggregate with all other such claims under that contract) from Acquired Company or (C) give rise to a right of acceleration of any material obligation or loss of any material benefit under any such contract, agreement or commitment.
(p)Properties. Acquired Company has no real property. Any facilities held under lease by Acquired Company is held by it under valid, subsisting and enforceable leases of which Acquired Company is in compliance, except as could not, individually or in the aggregate, have or reasonably be expected to result in a material adverse effect.
(q)Intellectual Property.
(1)As used in this Agreement, the term “Trademarks” means trademarks, service marks, trade names, internet domain names, designs, slogans, and general intangibles of like nature; the term “Trade Secrets” means technology; trade secrets and other confidential information, know-how, proprietary processes, formulae, algorithms, models, and methodologies; the term “ Intellectual Property “ means patents, copyrights, Trademarks, applications for any of the foregoing, and Trade Secrets; the term “ Company License Agreements “ means any license agreements granting any right to use or practice any rights under any Intellectual Property (except for such agreements for off-the-shelf products that are generally available for less than $10,000), and any written settlements relating to any Intellectual Property, to which Acquired Company is a party or otherwise bound; and the term “ Software “ means any and all computer programs, including any and all software
implementations of algorithms, models and methodologies, whether in source code or object code.
(2)Acquired Company owns or has valid rights to use the Trademarks, trade names, domain names, copyrights, patents, logos, licenses and computer software programs (including, without limitation, the source codes thereto) that are necessary for the conduct of its respective businesses as now being conducted. To the knowledge of Acquired Company, none of Acquired Company’s Intellectual Property or License Agreements infringe upon the rights of any third party that may give rise to a cause of action or claim against Acquired Company or its successors.
(r)Affiliate Transactions. Except as set forth in Schedule 3(r), no officer, director or employee of Acquired Company or any member of the immediate family of any such officer, director or employee, or any entity in which any of such persons owns any beneficial interest (other than any publicly-held corporation whose stock is traded on a national securities exchange or in the over-the-counter market and less than one percent of the stock of which is beneficially owned by any of such persons), has any agreement with Acquired Company or any interest in any of their property of any nature, used in or pertaining to the business of Acquired Company. None of the foregoing persons has any direct or indirect interest in any competitor, supplier or customer of Acquired Company or in any person from whom or to whom Acquired Company leases any property or transacts business of any nature.
(s)Undisclosed Liabilities. Except as set forth in Schedule 3(s), Acquired Company has no liabilities or obligations of any nature (whether fixed or unfixed, secured or unsecured, known or unknown and whether absolute, accrued, contingent, or otherwise.)
(t)Full Disclosure. All of the representations and warranties made by Acquired Company in this Agreement, and all statements set forth in the certificates delivered by Acquired Company at the Closing pursuant to this Agreement, are true, correct and complete in all material respects and do not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make such representations, warranties or statements, in light of the circumstances under which they were made, misleading. The copies of all documents furnished by Acquired Company pursuant to the terms of this Agreement are complete and accurate copies of the original documents. The schedules, certificates, and any and all other statements and information, whether furnished in written or electronic form, to RDAR or its representatives by or on behalf of any of Acquired Company or its affiliates in connection with the negotiation of this Agreement and the transactions contemplated hereby do not contain any material misstatement of fact or omit to state a material fact or any fact necessary to make the statements contained therein not misleading.
3.2Representations and Warranties of RDAR. As a material inducement for Acquired Company and the Owner to enter into this Agreement and to consummate the transactions contemplated hereby, RDAR hereby makes the following representations and warranties as of the date hereof and as of the Closing Date, each of which is relied upon by Acquired Company regardless of any investigation made or information obtained by Acquired Company (unless and to the extent specifically and expressly waived in writing by Acquired Company on or before the Closing Date):
(a)Organization, Standing and Corporate Power. RDAR is a corporation duly organized, validly existing and in good standing under the laws of the State of Nevada and has the requisite corporate power and authority and all government licenses, authorizations, permits, consents and approvals required to own, lease and operate its properties and carry on its business as now being conducted. RDAR is duly qualified or licensed to do business and is in good standing in each jurisdiction in which the nature of its business or the ownership or leasing of its properties makes such qualification or licensing necessary, other than in such jurisdictions where the failure to be so qualified or licensed (individually or in the aggregate) would not have a material adverse effect with respect to RDAR.
(b)Subsidiaries. RDAR has no subsidiaries.
(c)Capitalization of RDAR. The entire authorized capital stock of RDAR consists of 15,000,000,000 common shares, par value $0.001 per share, of which 4,433,149,661 shares are issued and outstanding, and 100,000,000 shares of preferred stock, par value $0.001 per share, (1) 1,000,000 shares of which are designated Series E Preferred Stock and 1,000,000 shares of which are issued and outstanding and (2) 75,000 shares of which are designated Series F Preferred Stock and no shares of which are issued and outstanding. All of RDAR’s issued and outstanding shares have been duly authorized, are validly issued, fully paid and non-assessable.
Except as set forth in Schedule 3.2(c), there are no other shares of RDAR capital stock issuable upon the exercise of outstanding warrants, convertible notes, options or otherwise. Except as set forth in Schedule 3.2(c), no shares of capital stock or other equity securities of RDAR are issued, reserved for issuance or outstanding.
The Exchange Shares will be, when issued, duly authorized, validly issued, fully paid and non-assessable, not subject to preemptive rights and issued in compliance with all applicable state and federal laws concerning the issuance of securities.
(d)Corporate Authority; Non-contravention. RDAR has all requisite corporate and other power and authority to enter into this Agreement and to consummate the transactions contemplated by this Agreement. The execution and delivery of this Agreement by RDAR and the consummation by RDAR of the transactions contemplated hereby have been (or at Closing will have been) duly authorized by all necessary corporate action on the part of RDAR. This Agreement has been duly executed and when delivered by RDAR shall constitute a valid and binding obligation of RDAR, enforceable against RDAR in accordance with its terms, except as such enforcement may be limited by bankruptcy, insolvency or other similar laws affecting the enforcement of creditors’ rights generally or by general principles of equity. The execution and delivery of this Agreement does not, and the consummation of the transactions contemplated by this Agreement and compliance with the provisions hereof will not, conflict with, or result in any breach or violation of, or default (with or without notice or lapse of time, or both) under, or give rise to a right of termination, cancellation or acceleration of or “put” right with respect to any obligation or to loss of a material benefit under, or result in the creation
of any lien upon any of the properties or assets of RDAR under (1) its articles of incorporation, bylaws, or other charter documents; (2) any loan or credit agreement, note, bond, mortgage, indenture, lease or other agreement, instrument, permit, concession, franchise or license applicable to RDAR,its properties or assets; or (3) subject to the governmental filings and other matters referred to in the following sentence, any judgment, order, decree, statute, law, ordinance, rule, regulation or arbitration award applicable to RDAR, its properties or assets, other than, in the case of clauses (2) and (3), any such conflicts, breaches, violations, defaults, rights, losses or liens that individually or in the aggregate could not have a material adverse effect with respect to RDAR or could not prevent, hinder or materially delay the ability of RDAR to consummate the transactions contemplated by this Agreement.
(e)Government Authorization. No consent, approval, order or authorization of, or registration, declaration or filing with, or notice to, any Governmental Entity, is required by or with respect to RDAR in connection with the execution and delivery of this Agreement by RDAR, or the consummation by RDAR of the transactions contemplated hereby, except, with respect to this Agreement, any filings under the Nevada Statutes, the Securities Act or the Exchange Act.
(f)Financial Statements.
(1)The unaudited financial statements of RDAR included in the reports, schedules, forms, statements and other documents filed by RDAR with OTC Markets (collectively, and in each case including all exhibits and schedules thereto and documents incorporated by reference therein, the “RDAR Financial Information”) comply as to form in all material respects with applicable accounting requirements and the published rules of OTC Markets with respect thereto, have been prepared in accordance with U.S. generally accepted accounting principles applied on a consistent basis during the periods involved (except as may be indicated in the notes thereto) and fairly present the consolidated financial position of RDAR and its consolidated subsidiaries as of the dates thereof and the consolidated results of operations and changes in cash flows for the periods then ended. Except as set forth in the RDAR Financial Information, at the date of the most recent unaudited financial statements of RDAR included in the RDAR Financial Information, RDAR has not incurred any liabilities or obligations of any nature (whether accrued, absolute, contingent or otherwise) which, individually or in the aggregate, could reasonably be expected to have a material adverse effect with respect to RDAR.
(2)RDAR has made the following financial information (the RDAR Financial Information) available to Acquired Company:
(A)unaudited balance sheet and statements of income, changes in stockholders’ equity and cash flow as of and for the years ended December 31, 2023 and 2022;
(B)unaudited balance sheet and statements of income, changes in stockholders’ equity and cash flow as of and for the six months ended June 30, 2024 (the “RDAR Interim Statements”); and
(C)The RDAR Financial Information presents fairly the financial condition of RDAR as of such dates and the results of operations of RDAR for such periods, in accordance with GAAP and are consistent with the books and records of RDAR (which books and records are correct and complete).
(g)Events Subsequent to RDAR Interim Statements. Since the date of the RDAR Interim Statements, there has not been, occurred or arisen, with respect to RDAR:
(1)any change or amendment in its Articles of Incorporation and/or Bylaws;
(2)any reclassification, split-up or other change in, or amendment of or modification to, the rights of the holders of any of its capital stock, except changes made in relation to the transactions contemplated by this Agreement;
(3)any direct or indirect redemption, purchase or acquisition by any person of any of its capital stock or of any interest in or right to acquire any such stock;
(4)any issuance, sale, or other disposition of any capital stock, or any grant of any options, warrants, or other rights to purchase or obtain (including upon conversion, exchange, or exercise) any capital stock;
(5)any declaration, set aside, or payment of any dividend or any distribution with respect to its capital stock (whether in cash or in kind) or any redemption, purchase, or other acquisition of any of its capital stock;
(6)the organization of any subsidiary or the acquisition of any shares of capital stock by any person or any equity or ownership interest in any business;
(7)any damage, destruction or loss of any of its properties or assets whether or not covered by insurance;
(8)any sale, lease, transfer or assignment of any of its assets, tangible or intangible, other than for a fair consideration in the ordinary course of business;
(9)the execution of, or any other commitment to any agreement, contract, lease, or license (or series of related agreements, contracts, leases, and licenses) outside the ordinary course of business;
(10)any acceleration, termination, modification, or cancellation of any agreement, contract lease or license (or series of related agreements, contracts, leases, and licenses) involving more than $10,000 to which it is a party or by which it is bound;
(11)any security interest or encumbrance imposed upon any of its assets, tangible;
(12)any capital investment in, any loan to, or any acquisition of the securities or assets of, any other person or entity (or series of related capital investments, loans and acquisitions) involving more than $2,500 and outside the ordinary course of business;
(13)any issuance of any note, bond or other debt security, or created, incurred, assumed, or guaranteed any indebtedness for borrowed money or capitalized lease obligation involving more than $2,500;
(14)any delay or postponement of the payment of accounts payable or other liabilities;
(15)any loan to, or any entrance into any other transaction with, any of its directors, officers and employees either involving more than $500 individually or $2,500 in the aggregate;
(16)any employment contract or collective bargaining agreement, written or oral, or modified the terms of any existing such contract or agreement;
(17)any taking of other action or entrance into any other transaction other than in the ordinary course of business, or entrance into any transaction with any insider of RDAR, except as disclosed in this Agreement and any disclosures schedules;
(18)any other event or occurrence that may have or could reasonably be expected to have a material adverse effect on RDAR (whether or not similar to any of the foregoing); or
(19)any agreement, whether in writing or otherwise, to do any of the foregoing.
(h)Certain Fees. No brokerage or finder’s fees or commissions are or will be payable by RDAR to any broker, financial advisor or consultant, finder, placement agent, investment banker, bank or other person with respect to the transactions contemplated by this Agreement.
(i)Litigation; Labor Matters; Compliance with Laws.
(1)There is no suit, action or proceeding or investigation pending or, to the knowledge of RDAR, threatened against or affecting RDAR or any basis for any such suit, action, proceeding or investigation that, individually or in the aggregate, could reasonably be expected to have a material adverse effect with respect to RDAR or prevent, hinder or materially delay the ability of RDAR to consummate the transactions contemplated by this Agreement, nor is there any judgment, decree, injunction, rule or order of any Governmental Entity or arbitrator outstanding against RDAR having, or which, insofar as reasonably could be foreseen by RDAR, in the future could have, any such effect.
(2)The conduct of the business of RDAR complies with all statutes, laws, regulations, ordinances, rules, judgments, orders, decrees or arbitration awards applicable thereto.
(j)Contracts. Except as set forth in Schedule 3.2(j), RDAR has no written or oral contracts, understandings, agreements and other arrangements executed by an officer or duly authorized employee of RDAR or to which RDAR is a party, except for this Agreement.
(k)OTC Markets Reports and Financial Statements. RDAR has filed with OTC Markets all reports and other filings required to be filed by RDAR in accordance with the rules of OTC Markets (the “RDAR OTC Markets Reports”). As of their respective dates, the RDAR OTC Markets Reports complied in all material respects with the applicable requirements of the Securities Act, the Exchange Act and the respective rules and regulations promulgated thereunder applicable to such RDAR OTC Markets Reports and, except to the extent that information contained in any RDAR OTC Markets Report has been revised or superseded by a later RDAR OTC Markets Report filed and publicly available prior to the date of this Agreement, none of the RDAR OTC Markets Reports contained any untrue statement of a material fact or omitted to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. The financial statements of RDAR included in RDAR OTC Markets Reports were prepared from and are in accordance with the accounting books and other financial records of RDAR, were prepared in accordance with GAAP applied on a consistent basis during the periods involved (except as may be indicated in the notes thereto) and presented fairly the consolidated financial position of RDAR as of the dates thereof and the consolidated results of operations and cash flows for the periods then ended. Except as set forth in the RDAR OTC Markets Reports, RDAR has no liabilities or obligations of any nature (whether accrued, absolute, contingent or otherwise) other than liabilities or obligations incurred in the ordinary course of business. The RDAR OTC Markets Reports accurately disclose (1) the terms and provisions of all stock option plans, (2) transactions with Affiliates and (3) all material contracts. If, at any time prior to Closing, should RDAR become delinquent in any required filings with OTC Markets, RDAR represents and warrants that such filings shall be brought current in no less than 10 business days from the due date. Until such time as the filing is brought current, RDAR will promptly file any and all reports required to advise the OTC Markets of the failure to file the reports when due.
(l)Board Determination. The Board of Directors of RDAR has unanimously determined that the terms of the Share
Exchange are fair to and in the best interests of RDAR and its shareholders.
(m)Required RDAR Share Issuance Approval. RDAR represents that the issuance of the Exchange Shares to the Owner will be in compliance with the Nevada Statutes and the Bylaws of RDAR, as well as federal and state securities laws.
(n)Undisclosed Liabilities. Except as set forth in Schedule 3.2(n), RDAR has no liabilities or obligations of any nature (whether fixed or unfixed, secured or unsecured, known or unknown and whether absolute, accrued, contingent, or otherwise) except for liabilities or obligations reflected or reserved against in the RDAR OTC Markets Documents incurred in the ordinary course of business.
(o)Full Disclosure. All of the representations and warranties made by RDAR in this Agreement, and all statements set forth in the certificates delivered by RDAR at the Closing pursuant to this Agreement, are true, correct and complete in all material respects and do not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make such representations, warranties or statements, in light of the circumstances under which they were made, misleading. The copies of all documents furnished by RDAR pursuant to the terms of this Agreement are complete and accurate copies of the original documents. The schedules, certificates, and any and all other statements and information, whether furnished in written or electronic form, to Acquired Company or its representatives by or on behalf of RDAR in connection with the negotiation of this Agreement and the transactions contemplated hereby do not contain any material misstatement of fact or omit to state a material fact or any fact necessary to make the statements contained therein not misleading.
(p)Powers of Attorney. There are no outstanding powers of attorney executed on behalf of RDAR.
Article IV.
Covenants Relating to Conduct of Business Prior to Share Exchange
4.1Conduct of Acquired Company and RDAR. From the date of this Agreement and until the Effective Time, or until the prior termination of this Agreement, Acquired Company and RDAR shall not, unless mutually agreed to in writing:
(a)engage in any transaction, except in the normal and ordinary course of business, or create or suffer to exist any lien or other encumbrance upon any of their respective assets or which will not be discharged in full prior to the Effective Time;
(b)sell, assign or otherwise transfer any of their assets, or cancel or compromise any debts or claims relating to their assets, other than for fair value, in the ordinary course of business, and consistent with past practice;
(c)fail to use reasonable efforts to preserve intact their present business organizations, keep available the services of their employees and preserve its material relationships with customers, suppliers, licensors, licensees, distributors and others, to the end that its good will and ongoing business not be impaired prior to the Effective Time;
(d)suffer or permit any material adverse change to occur with respect to Acquired Company and RDAR or their business or assets; and
(e)make any material change with respect to their business in accounting or bookkeeping methods, principles or practices, except as required by GAAP.
4.2Current Information.
(a)During the period from the date of this Agreement to the Closing, each party hereto shall promptly notify each other party of any (1) significant change in its ordinary course of business, (2) proceeding (or communications indicating that the same may be contemplated), or the institution or threat or settlement of proceedings, in each case involving the Parties the outcome of which, if adversely determined, could reasonably be expected to have a material adverse effect on the Party, taken as a whole or (3) event which such Party reasonably believes could be expected to have a material adverse effect on the ability of any party hereto to consummate the Share Exchange.
(b)During the period from the date of this Agreement to the Closing, RDAR shall promptly notify Acquired Company of any correspondence received from OTC Markets or the SEC and shall deliver a copy of such correspondence to Acquired Company within one (1) business day of receipt.
4.3Material Transactions. Prior to the Closing, neither Acquired Company nor RDAR will, without first obtaining the written consent of the other parties hereto:
(a)amend its Articles of Incorporation or Bylaws or enter into any agreement to merge or consolidate with, or sell a significant portion of its assets to, any other Person;
(b)place on any of its assets or properties any pledge, charge or other encumbrance, except as otherwise authorized hereunder, or enter into any transaction or make any contract or commitment relating to its properties, assets and business, other than in the ordinary course of business or as otherwise disclosed herein;
(c)guarantee the obligation of any person, firm or corporation, except in the ordinary course of business;
(d)make any loan or advance in excess of $2,500 in the aggregate or cancel or accelerate any material indebtedness owing to it or any claims which it may possess or waive any material rights of substantial value;
(e)violate any applicable law which violation might have a material adverse effect on such party;
(f)except in the ordinary course of business, enter into any agreement or transaction with any of such party’s affiliates; or
(g)engage in any transaction or take any action that would render untrue in any material respect any of the representations and warranties of such party contained in this Agreement, as if such representations and warranties were given as of the date of such transaction or action.
Article V.
Additional Agreements
5.1Reorganization Agreement: Mexedia Inc. At or prior to the Closing, RDAR, Mexedia Inc. (“US Mexedia”) and the owner of US Mexedia shall have entered into a Share Exchange Agreement, in the form of Exhibit B attached hereto (the “US Mexedia SPA”), pursuant to which RDAR would acquire all of the outstanding shares of capital stock of US Mexedia.
5.2Redemption Agreement. At or prior to the Closing, RDAR and JanBella Group, LLC shall have entered into a Redemption Agreement, in the form of Exhibit C attached hereto (the “Redemption Agreement”), pursuant to which RDAR would re-acquire all outstanding shares of Series E Preferred Stock of RDAR.
5.3Access to Information; Confidentiality.
(a)Acquired Company shall, and shall cause its officers, employees, counsel, financial advisors and other representatives to, afford to RDAR and its representatives reasonable access during normal business hours during the period prior to the Effective Time to its and to Acquired Company’s properties, books, contracts, commitments, personnel and records and, during such period, Acquired Company shall, and shall cause its officers, employees and representatives to, furnish promptly to RDAR all information concerning its business, properties, financial condition, operations and personnel as such other party may from time to time reasonably request. For the purposes of determining the accuracy of the representations and warranties of RDAR set forth herein and compliance by RDAR of its obligations hereunder, during the period prior to the Effective Time, RDAR shall provide Acquired Company and its representatives with reasonable access during normal business hours to its properties, books, contracts, commitments, personnel and records as may be necessary to enable Acquired Company to confirm the accuracy of the representations and warranties of RDAR set forth herein and compliance by RDAR of its obligations hereunder, and, during such period, RDAR shall, and shall cause its officers, employees and representatives to, furnish promptly to Acquired Company upon its request (1) a copy of each report, schedule, registration statement and other document filed by it during such period pursuant to the requirements of federal or state securities laws and (2) all other information concerning its business, properties, financial condition, operations and personnel as such other party may from time to time reasonably request.
Except as required by law, each of Acquired Company and RDAR will hold, and will cause its respective directors, officers, employees, accountants, counsel, financial advisors and other representatives and affiliates to hold, any nonpublic information in confidence.
(b)No investigation pursuant to this Section 5.3 shall affect any representations or warranties of the parties herein or the conditions to the obligations of the parties hereto.
5.4Best Efforts. Upon the terms and subject to the conditions set forth in this Agreement, each of the parties agrees to use its best efforts to take, or cause to be taken, all actions, and to do, or cause to be done, and to assist and cooperate with the other parties in doing, all things necessary, proper or advisable to consummate and make effective, in the most expeditious manner practicable, the Share Exchange and the other transactions contemplated by this Agreement. RDAR and Acquired Company shall mutually cooperate in order to facilitate the achievement of the benefits reasonably anticipated from the Share Exchange.
5.5Public Announcements. RDAR, on the one hand, and Acquired Company, on the other hand, will consult with each other before issuing, and provide each other the opportunity to review and comment upon, any press release or other public statements with respect to the transactions contemplated by this Agreement and shall not issue any such press release or make any such public statement prior to such consultation, except as may be required by applicable law or court process. The parties agree that the initial press release or releases to be issued with respect to the transactions contemplated by this Agreement shall be mutually agreed upon prior to the issuance thereof.
5.6Expenses. All costs and expenses incurred in connection with this Agreement and the transactions contemplated hereby shall be paid by the party incurring such expenses.
5.7No Solicitation. Except as previously agreed to in writing by the other party, neither Acquired Company nor RDAR shall authorize or permit any of its officers, directors, agents, representatives, or advisors to solicit, initiate or encourage or take any action to facilitate the submission of inquiries, proposals or offers from any person relating to any matter concerning any exchange, merger, consolidation, business combination, recapitalization or similar transaction involving Acquired Company or RDAR, respectively, other than the transaction contemplated by this Agreement or any other transaction the consummation of which would or could reasonably be expected to impede, interfere with, prevent or delay the Share Exchange or which would or could be expected to dilute the benefits to either Acquired Company or RDAR of the transactions contemplated hereby. Acquired Company or RDAR will immediately cease and cause to be terminated any existing activities, discussions and
negotiations with any parties conducted heretofore with respect to any of the foregoing.
Article VI.
Conditions Precedent and Conditions Subsequent
6.1Conditions to Each Party’s Obligation to Effect the Share Exchange. The obligation of each party to effect the Share Exchange and otherwise consummate the transactions contemplated by this Agreement is subject to the satisfaction, at or prior to the Closing, of each of the following conditions:
(a)No Restraints. No temporary restraining order, preliminary or permanent injunction or other order preventing the consummation of the Share Exchange shall have been issued by any court of competent jurisdiction or any other Governmental Entity having jurisdiction and shall remain in effect, and there shall not be any applicable legal requirement enacted, adopted or deemed applicable to the Share Exchange that makes consummation of the Share Exchange illegal.
(b)Governmental Approvals.
(1)As to RDAR and Acquired Company. All authorizations, consents, orders, declarations or approvals of, or filings with, or terminations or expirations of waiting periods imposed by, any governmental entity having jurisdiction which the failure to obtain, make or occur would have a material adverse effect on RDAR or Acquired Company shall have been obtained, made or occurred.
(2)As to the Owner. All required approvals required by local rules and regulations, stock market rules and regulations and corporate governance requirements, including the issuance of any and all required communications with respect thereto, as well as all other authorizations, consents, orders, declarations or approvals of, or filings with, or terminations or expirations of waiting periods imposed by, any governmental entity having jurisdiction which the failure to obtain, make or occur would have a material adverse effect on the Owner shall have been obtained, made or occurred.
(c)No Litigation. There shall not be pending or threatened any suit, action or proceeding before any court, Governmental Entity or authority (1) pertaining to the transactions contemplated by this Agreement or (2) seeking to prohibit or limit the ownership or operation by Acquired Company or RDAR, or to dispose of or hold separate any material portion of the business or assets of Acquired Company or RDAR.
6.2Conditions Precedent to Obligations of RDAR. The obligation of RDAR to effect the Share Exchange and otherwise consummate the transactions contemplated by this Agreement are subject to the satisfaction, at or prior to the Closing, of each of the following conditions:
(a)Representations, Warranties and Covenants. The representations and warranties of Acquired Company in this Agreement shall be true and correct in all material respects (except for such representations and warranties that are qualified by their terms by a reference to materiality or material adverse effect, which representations and warranties as so qualified shall be true and correct in all respects) both when made and on and as of the Closing Date, and Acquired Company shall have performed and complied in all material respects with all covenants, obligations and conditions of this Agreement required to be performed and complied with by each of them prior to the Effective Time.
(b)Consents. RDAR shall have received evidence, in form and substance reasonably satisfactory to it, that such licenses, permits, consents, approvals, authorizations, qualifications and orders of governmental authorities and other third parties as necessary in connection with the transactions contemplated hereby have been obtained.
(c)No Material Adverse Change. There shall not have occurred any change in the business, condition (financial or otherwise), results of operations or assets (including intangible assets) and properties of Acquired Company that, individually or in the aggregate, could reasonably be expected to have a material adverse effect on Acquired Company.
(d)Board Resolutions. RDAR shall have received resolutions duly adopted by Acquired Company’s board of directors and the Owner’s board of directors approving the execution, delivery and performance of the Agreement and the transactions contemplated by the Agreement.
(e)Other Approvals. RDAR shall have received from the Owner written confirmation of its having obtained any and all approvals relating to this Agreement as may be required by the securities laws of the French Republic, including the rules and regulations promulgated thereunder.
(f)Due Diligence Investigation. RDAR shall be reasonably satisfied with the results of its due diligence investigation of Acquired Company in its sole and absolute discretion.
6.3Conditions Precedent to Obligation of Acquired Company. The obligation of Acquired Company to effect the Share Exchange and otherwise consummate the transactions contemplated by this Agreement is subject to the satisfaction, at or prior to the Closing, of each of the following conditions:
(a)Representations, Warranties and Covenants. The representations and warranties of RDAR in this Agreement shall be true and correct in all material respects (except for such representations and warranties that are qualified by their terms by a reference to materiality or material adverse effect, which representations and warranties as so qualified shall be true and correct in all respects) both when made
and on and as of the Closing Date, and RDAR shall have performed and complied in all material respects with all covenants, obligations and conditions of this Agreement required to be performed and complied with by it prior to the Effective Time.
(b)Consents. Acquired Company shall have received evidence, in form and substance reasonably satisfactory to it, that such licenses, permits, consents, approvals, authorizations, qualifications and orders of governmental authorities and other third parties as necessary in connection with the transactions contemplated hereby have been obtained.
(c)No Material Adverse Change. There shall not have occurred any change in the business, condition (financial or otherwise), results of operations or assets (including intangible assets) and properties of RDAR that, individually or in the aggregate, could reasonably be expected to have a material adverse effect on RDAR.
(d)Board Resolutions. Acquired Company shall have received resolutions duly adopted by RDAR’s board of directors and the Owner’s board of directors approving the execution, delivery and performance of the Agreement and the transactions contemplated by the Agreement.
(e)Other Approvals. Acquired Company shall have received from the Owner written confirmation of its having obtained any and all approvals relating to this Agreement as may be required by the securities laws of the French Republic, including the rules and regulations promulgated thereunder.
(f)Due Diligence Investigation. Acquired Company shall be reasonably satisfied with the results of its due diligence investigation of RDAR in its sole and absolute discretion.
6.4Conditions Subsequent.
(a)Regulation A Offering. Should RDAR fail to have filed an Offering Statement on Form 1-A pursuant to Regulation A of the Securities and Exchange Commission (the “Reg A Offering”), on or before the 20th day following the Closing, the Owner shall have the right, but not the obligation, to rescind this Agreement by written notice to RDAR.
(b)Regulation A Offering Proceeds. Should RDAR fail to have obtained the sum of $1,500,000 in proceeds from the Reg A Offering, on or before the date that is six (6) months from the date of the SEC’s qualification of the Reg A Offering, the Members shall have the right, but not the obligation, to rescind this Agreement by unanimous written notice to RDAR (the “Rescission Notice”). Upon RDAR’s receipt of the Rescission Notice, this Agreement shall, ipso facto, be rescinded and the Parties returned to their statuses quo ante.
(c)Divestiture. Should RDAR fail to have divested of its current operations, which divestiture shall include all debts, other than the trade payables of RDAR listed on Exhibit D attached hereto and incorporated herein, of RDAR as of the Closing Date, on or before December 31, 2024, the Owner shall have the right, but not the obligation, to rescind this Agreement by written notice to RDAR.
Article VII.
Closing
7.1RDAR shall make the following deliveries at the Closing. To consummate the transaction, RDAR shall, at the Closing, make the following deliveries:
(a)Executed Closing Certificate, in the form of Exhibit E attached hereto;
(b)Executed written consent of the Board of Directors or RDAR authorizing each of the Change-in-Control Agreement, including this Agreement, and the issuance of the Exchange Shares;
(c)A fully executed US Mexedia SPA;
(d)A fully executed Redemption Agreement; and
(e)The Exchange Shares, in the form of the Exchange Shares Certificate.
7.2Acquired Company and the Owner shall make the following deliveries at the Closing. To consummate the transaction Acquired Company and the Owner shall, at Closing, make the following deliveries:
(a)Executed Closing Certificate, in the form of Exhibit F attached hereto;
(b)A fully executed US Mexedia SPA; and
(c)The Ownership Interest, duly assigned to RDAR.
Article VIII.
Termination, Amendment and Waiver
8.1Termination. This Agreement may be terminated and abandoned at any time prior to the Effective Time of the Share Exchange:
(a)by mutual written consent of RDAR and Acquired Company;
(b)by either RDAR or Acquired Company if any Governmental Entity shall have issued an order, decree or ruling or taken any other action permanently enjoining, restraining or otherwise prohibiting the Share Exchange and such order, decree, ruling or other action shall have become final and non-appealable;
(c)by either RDAR or Acquired Company if the Share Exchange shall not have been consummated on or before January 31, 2025 (other than as a result of the failure of the party seeking to terminate this Agreement to perform its obligations under this Agreement required to be performed at or prior to the Effective Time).
(d)by RDAR, if a material adverse change shall have occurred relative to Acquired Company (and not curable within 10 days);
(e)by Acquired Company if a material adverse change shall have occurred relative to RDAR (and not curable within thirty 10 days);
(f)by RDAR, if Acquired Company willfully fails to perform in any material respect any of its material obligations under this Agreement; or
(g)by Acquired Company, if RDAR willfully fails to perform in any material respect any of its obligations under this Agreement.
8.2Effect of Termination. In the event of termination of this Agreement by either Acquired Company or RDAR as provided in Section 8.1, this Agreement shall forthwith become void and have no effect, without any liability or obligation on the part of RDAR or Acquired Company, other than the provisions of this Section 8.2. Nothing contained in this Section 8.2 shall relieve any party for any breach of the representations, warranties, covenants or agreements set forth in this Agreement.
8.3Amendment. This Agreement may not be amended except by an instrument in writing signed on behalf of each of the parties upon approval by the party, if such party is an individual, and upon approval of the Board of Director of RDAR and of Acquired Company.
8.4Extension; Waiver. Subject to Section 8.1(c), at any time prior to the Effective Time, the parties may (a) extend the time for the performance of any of the obligations or other acts of the other parties, (b) waive any inaccuracies in the representations and warranties contained in this Agreement or in any document delivered pursuant to this Agreement, or (c) waive compliance with any of the agreements or conditions contained in this Agreement. Any agreement on the part of a party to any such extension or waiver shall be valid only if set forth in an instrument in writing signed on behalf of such party. The failure of any party to this Agreement to assert any of its rights under this Agreement or otherwise shall not constitute a waiver of such rights.
8.5Return of Documents. In the event of termination of this Agreement for any reason, RDAR and Acquired Company will return to the other party all of the other party’s documents, work papers, and other materials (including copies) relating to the transactions contemplated in this Agreement, whether obtained before or after execution of this Agreement. RDAR and Acquired Company will not use any information so obtained from the other party for any purpose and will take all reasonable steps to have such other party’s information kept confidential.
Article IX.
Indemnification and Related Matters
9.1Survival of Representations and Warranties. The representations and warranties in this Agreement or in any instrument delivered pursuant to this Agreement, including any disclosure schedule, shall survive until twelve (12) months after the Effective Time (except for with respect to Taxes, which shall survive for the applicable statute of limitations plus 90 days, and covenants that by their terms survive for a longer period). The right to any remedy based upon such representations and warranties shall not be affected by any investigation conducted with respect to, or any knowledge acquired at any time, whether before or after execution and delivery of this Agreement or the Closing Date, with respect to the accuracy or inaccuracy of any such representation or warranty.
9.2Indemnification.
(a)RDAR shall indemnify and hold Acquired Company and Acquired Company’s officers and directors (“Acquired Company Representatives”) harmless for, from and against any and all liabilities, obligations, damages, losses, deficiencies, costs, penalties, interest and expenses (including, but not limited to, any and all expenses whatsoever reasonably incurred in investigating, preparing or defending against any litigation, commenced or threatened, or any claim whatsoever) (collectively, “Losses”) to which RDAR may become subject resulting from or arising out of any breach of a representation, warranty or covenant made by RDAR as set forth herein.
(b)Acquired Company shall indemnify and hold RDAR and RDAR’s officers and directors (“RDAR’s Representatives”)
harmless for, from and against any and all Losses to which RDAR or RDAR’s Representatives may become subject resulting from or arising out of (1) any breach of a representation, warranty or covenant made by Acquired Company as set forth herein; or (2) any and all liabilities arising out of or in connection with: (A) any of the assets of Acquired Company prior to the Closing; or (B) the operations of Acquired Company prior to the Closing.
9.3Notice of Indemnification. Promptly after the receipt by any indemnified party (the “Indemnitee”) of notice of the commencement of any action or proceeding against such Indemnitee, such Indemnitee shall, if a claim with respect thereto is or may be made against any indemnifying party (the “Indemnifying Party”) pursuant to this Article IX, give such Indemnifying Party written notice of the commencement of such action or proceeding and give such Indemnifying Party a copy of such claim and/or process and all legal pleadings in connection therewith. The failure to give such notice shall not relieve any Indemnifying Party of any of its indemnification obligations contained in this Article IX, except where, and solely to the extent that, such failure actually and materially prejudices the rights of such Indemnifying Party. Such Indemnifying Party shall have, upon request within thirty (30) days after receipt of such notice, but not in any event after the settlement or compromise of such claim, the right to defend, at its own expense and by its own counsel reasonably acceptable to the Indemnitee, any such matter involving the asserted liability of the Indemnitee; provided, however, that if the Indemnitee determines that there is a reasonable probability that a claim may materially and adversely affect it, other than solely as a result of money payments required to be reimbursed in full by such Indemnifying Party under this Article IX or if a conflict of interest exists between Indemnitee and the Indemnifying Party, the Indemnitee shall have the right to defend, compromise or settle such claim or suit; and, provided, further, that such settlement or compromise shall not, unless consented to in writing by such Indemnifying Party, which shall not be unreasonably withheld, be conclusive as to the liability of such Indemnifying Party to the Indemnitee. In any event, the Indemnitee, such Indemnifying Party and its counsel shall cooperate in the defense against, or compromise of, any such asserted liability, and in cases where the Indemnifying Party shall have assumed the defense, the Indemnitee shall have the right to participate in the defense of such asserted liability at the Indemnitee’s own expense. In the event that such Indemnifying Party shall decline to participate in or assume the defense of such action, prior to paying or settling any claim against which such Indemnifying Party is, or may be, obligated under this Article IX to indemnify an Indemnitee, the Indemnitee shall first supply such Indemnifying Party with a copy of a final court judgment or decree holding the Indemnitee liable on such claim or, failing such judgment or decree, the terms and conditions of the settlement or compromise of such claim. An Indemnitee’s failure to supply such final court judgment or decree or the terms and conditions of a settlement or compromise to such Indemnifying Party shall not relieve such Indemnifying Party of any of its indemnification obligations contained in this Article IX, except where, and solely to the extent that, such failure actually and materially prejudices the rights of such Indemnifying Party. If the Indemnifying Party is defending the claim as set forth above, the Indemnifying Party shall have the right to settle the claim only with the consent of the Indemnitee.
Article X.
General Provisions
10.1Notices. Any and all notices and other communications hereunder shall be in writing and shall be deemed duly given to the party to whom the same is so delivered, sent or mailed at addresses and contact information set forth below (or at such other address for a party as shall be specified by like notice.) Any and all notices or other communications or deliveries required or permitted to be provided hereunder shall be deemed given and effective on the earliest of: (a) on the date of transmission, if such notice or communication is delivered via e-mail at the e-mail address set forth on the signature pages attached hereto prior to 5:30 p.m. (Eastern Time) on a business day, (b) on the next business day after the date of transmission, if such notice or communication is delivered via facsimile at the facsimile number set forth on the signature pages attached hereto on a day that is not a business day or later than 5:30 p.m. (Eastern Time) on any business day, (c) on the second business day following the date of mailing, if sent by a nationally recognized overnight courier service, or (d) if by personal delivery, upon actual receipt by the party to whom such notice is required to be given.
If to RDAR prior to Closing:
7950 East Redfield Road, Unit 210
Scottsdale, AZ 85260
If to Acquired Company:
17 Clanwilliam Square, Grand Canal Quay
Dublin 2 D02 DH98, Republic of Ireland
If to the Owner:
Via di Affogalasino, 105 - 00148 Roma RM
10.2Definitions. For purposes of this Agreement:
(a)an “affiliate” of any person means another person that directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with, such first person;
(b)“material adverse change” or “material adverse effect” means, when used in connection with Acquired Company or RDAR, any change or effect that either individually or in the aggregate with all other such changes or effects is materially adverse to the business, assets, properties, condition (financial or otherwise) or results of operations of such party and its subsidiaries taken as a whole (after giving effect in the case of RDAR to the consummation of the Share Exchange);
(c)“person” means an individual, corporation, partnership, joint venture, association, trust, unincorporated organization or other entity; and
(d)a “subsidiary” of any person means another person, an amount of the voting securities, other voting ownership or
voting partnership interests of which is sufficient to elect at least a majority of its board of Directors or other governing body (or, if there are no such voting interests, fifty percent (50%) or more of the equity interests of which) is owned directly or indirectly by such first person.
10.3Interpretation. When a reference is made in this Agreement to a Section, Exhibit or Schedule, such reference shall be to a Section of, or an Exhibit or Schedule to, this Agreement unless otherwise indicated. The headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement. Whenever the words “include”, “includes” or “including” are used in this Agreement, they shall be deemed to be followed by the words “without limitation.”
10.4Entire Agreement; No Third-Party Beneficiaries. This Agreement and the other agreements referred to herein constitute the entire agreement, and supersede all prior agreements and understandings, both written and oral, among the parties with respect to the subject matter of this Agreement. This Agreement is not intended to confer upon any person other than the parties any rights or remedies.
10.5Governing Law. This Agreement shall be governed by, and construed in accordance with, the laws of the State of Nevada, regardless of the laws that might otherwise govern under applicable principles of conflicts of laws thereof.
10.6Assignment. Neither this Agreement nor any of the rights, interests or obligations under this Agreement shall be assigned, in whole or in part, by operation of law or otherwise by any of the parties without the prior written consent of the other parties. Subject to the preceding sentence, this Agreement will be binding upon, inure to the benefit of, and be enforceable by, the parties and their respective successors and assigns.
10.7Enforcement. The parties agree that irreparable damage would occur in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached. It is accordingly agreed that the parties shall be entitled to an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions of this Agreement in any court of the United States located in the State of Nevada, this being in addition to any other remedy to which they are entitled at law or in equity. In addition, each of the parties hereto (a) agrees that it will not attempt to deny or defeat such personal jurisdiction or venue by motion or other request for leave from any such court, and (b) agrees that it will not bring any action relating to this Agreement or any of the transactions contemplated by this Agreement in any state court other than such court.
10.8Severability. Whenever possible, each provision or portion of any provision of this Agreement will be interpreted in such manner as to be effective and valid under applicable law but if any provision or portion of any provision of this Agreement is held to be invalid, illegal or unenforceable in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability will not affect any other provision or portion of any provision in such jurisdiction, and this Agreement will be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision or portion of any provision had never been contained herein.
10.9Counterparts. This Agreement may be executed simultaneously in two or more counterparts, any one of which need not contain the signatures of more than one party, but all such counterparts taken together will constitute one and the same Agreement. This Agreement, to the extent delivered by means of a facsimile machine or electronic mail (any such delivery, an “ Electronic Delivery “), shall be treated in all manner and respects as an original agreement or instrument and shall be considered to have the same binding legal effect as if it were the original signed version thereof delivered in person. At the request of any party hereto, each other party hereto shall re-execute original forms hereof and deliver them in person to all other parties. No party hereto shall raise the use of Electronic Delivery to deliver a signature or the fact that any signature or agreement or instrument was transmitted or communicated through the use of Electronic Delivery as a defense to the formation of a contract, and each such party forever waives any such defense, except to the extent such defense related to lack of authenticity.
10.10Attorneys’ Fees. In the event any suit or other legal proceeding is brought for the enforcement of any of the provisions of this Agreement, the parties hereto agree that the prevailing party or parties shall be entitled to recover from the other party or parties upon final judgment on the merits reasonable attorneys’ fees, including attorneys’ fees for any appeal, and costs incurred in bringing such suit or proceeding.
IN WITNESS WHEREOF, the undersigned have caused their duly authorized officers to execute this Agreement as of the date first above written.
RDAR:ACQUIRED COMPANY:
RAADR, INC.MEXEDIA DAC
EXEMPLAREXEMPLAR
By: __________________________By: __________________________
Jacob DiMartinoOrlando Taddeo
Chief Executive OfficerPresident
E-Mail: jacob.d@raadr.comE-Mail: otaddeo@mexedia.com
OWNER:
MEXEDIA S.p.A. S.B.
EXEMPLAR
By: __________________________
Orlando Taddeo
President
E-Mail: otaddeo@mexedia.com
EXHIBIT C
Form of Redemption Agreement
REDEMPTION AGREEMENT
This Agreement (the “Agreement”) is made as of September ___, 2024, by and between Raadr, Inc., a Nevada corporation (the “Issuer”), and JanBella Group, LLC, a stockholder of the Issuer (“Seller”).
RECITALS
WHEREAS, Seller is the owner of 1,000,000 shares of the Issuer’s Series E Preferred Stock, par value $0.001 per share (“Subject Preferred Stock”); and
WHEREAS, Seller desires to sell to the Issuer, and the Issuer desires to re-purchase and redeem from Seller, the Subject Preferred Stock, which shall result in the re-purchase and redemption by the Issuer of the Subject Preferred Stock, on and subject to the terms of this Agreement.
NOW, THEREFORE, the parties hereto hereby agree as follows:
1.Sale of the Shares. Subject to the terms and conditions of this Agreement, and in reliance upon the representations, warranties, covenants and agreements contained in this Agreement, Seller shall sell to the Issuer the Subject Preferred Stock, and the Issuer shall re-purchase and redeem the Subject Preferred Stock from Seller, for the purchase price set forth in Exhibit A attached hereto and incorporated herein by this reference (the “Purchase Price”).
2.Right to Rescind. If the Acquisition Agreements (defined below) are rescinded in accordance with their respective terms or if the Issuer defaults on the Redemption Note (as defined in Exhibit A), then Seller shall have the right, but not the obligation, to rescind this Agreement by written notice to the Issuer. Should Seller so rescind this Agreement, the Issuer shall, without delay, re-issue the Subject Preferred Stock to Seller and Seller shall retain any and all amounts paid to Seller under the Redemption Note (as defined in Exhibit A) as liquidated damages.
3.Condition Precedent. As a condition precedent to the Closing (defined below) of this Agreement, Seller and Mexedia S.p.A. S.B., as guarantor of the Note, of the Note, shall have entered into a pledge agreement (the “Pledge Agreement”), in the form of Exhibit B attached hereto, and a guaranty (the “Guaranty”), in the form of Exhibit C attached hereto. The Pledge Agreement and the Guaranty are to become binding agreement upon the consummation of the Acquisition Agreements.
4.Closing.
(a)The purchase and sale of the Subject Preferred Stock shall take place at a closing (the “Closing”), to occur immediately following the effectiveness of the acquisition transactions (the “Acquisitions”) contemplated by those certain share exchange agreements, dated as of September ___, 2024, by and between (1) the Issuer, Mexedia, Inc. and its shareholder and (2) the Issuer, Mexedia DAC an its shareholder (collectively, the “Acquisition Agreements”). The parties hereto shall have no obligation to complete the Closing in the event all of the Acquisition Agreements are not consummated contemporaneously.
(b)At the Closing:
(1)Seller shall deliver to the Issuer book-entry statements representing the shares of Subject Preferred Stock, duly endorsed in form for transfer to the Issuer.
(2)The Issuer shall have delivered a fully executed Pledge Agreement and a fully executed Guaranty.
(3)The Issuer shall pay to Seller the Purchase Price, as set forth in Exhibit A.
(4)At, and at any time after, the Closing, Seller shall duly execute, acknowledge and deliver all such further assignments, conveyances, instruments and documents, and shall take such other action consistent with the terms of this Agreement to carry out the transactions contemplated by this Agreement, as may be requested by the Issuer.
5.Representations and Warranties.
(a)Of Seller. Seller makes the following representations and warranties to the Issuer with respect to Seller and the Subject Preferred Stock to be sold by Seller hereunder:
(1)Seller is domiciled in the United States of America.
(2)Seller is an “accredited investor” as such term is defined in Rule 501(a) of Regulation D promulgated under the Securities Act of 1933, as amended (the “Securities Act”).
(3)Seller has the requisite power and authority to enter into this Agreement and to consummate the transactions contemplated hereby and otherwise to carry out its obligations hereunder.
(4)Seller owns the Subject Preferred Stock free and clear of any and all options, liens, claims, encumbrances, security interests, pledges, preemptive rights, rights of first refusal and adverse interests of any kind. Seller agrees that the consideration payable by the Issuer for the re-purchase and redemption of the Subject Preferred Stock is fair and reasonable and that Seller is in the best position to evaluate and determine the fair value of the Subject Preferred Stock. There are no restrictions on the transfer or redemption of the Subject Preferred Stock (other than restrictions under the Securities Act or state securities laws). No person or entity has any right to purchase the Subject Preferred Stock or any portion thereof or interest therein.
(5)Seller has received and reviewed the Acquisition Agreements and understands and consents to the transactions contemplated thereby. Seller has been afforded the opportunity during the course of negotiating the transactions contemplated by this Agreement to ask questions of, and to secure such information from, the Issuer and its officers and directors with regard to each of the Issuer and Mexedia S.p.A. S.B., the owner of Mexedia, Inc. and Mexedia DAC, as it deems necessary to evaluate the merits of consenting to the Issuer’s consummating such transactions, it being understood that Seller is the controlling stockholder of the Issuer and, as such, is intimately familiar with the Issuer and its business, operations, assets, liabilities, prospects and financial condition in all respects. All such questions, if asked, were answered satisfactorily and all information or documents provided were found to be satisfactory.
(6)There is no private or governmental action, suit, proceeding, claim, arbitration or investigation pending before any agency, court or tribunal, foreign or domestic, or, to Seller’s knowledge, threatened against Seller or any of its properties. There is no judgment, decree or order against Seller that could prevent, enjoin, alter or delay any of the transactions contemplated by this Agreement.
(7)No bankruptcy, receivership or debtor relief proceedings are pending or, to Seller’s knowledge, threatened against Seller.
(8)All representations, covenants and warranties of Seller contained in this Agreement shall be true and correct on and as of the Closing Date with the same effect as though the same had been made on and as of such date.
(b)Of the Issuer. The Issuer makes the following representations and warranties to Seller:
(1)The Board of Directors has authorized the Issuer’s entering into this Agreement and consummating the transactions contemplated hereby and otherwise to carry out its obligations hereunder.
(2)The Issuer is in good standing in the State of Nevada and in every other jurisdiction in which it engages in business.
(3)There is no private or governmental action, suit, proceeding, claim, arbitration or investigation pending before any agency, court or tribunal, foreign or domestic, or, to the Issuer’s knowledge, threatened against the Issuer or any of its properties. There is no judgment, decree or order against the Issuer that could prevent, enjoin, alter or delay any of the transactions contemplated by this Agreement.
(4)No bankruptcy, receivership or debtor relief proceedings are pending or, to the Issuer’s knowledge, threatened against the Issuer.
(5)All representations, covenants and warranties of the Issuer contained in this Agreement shall be true and correct on and as of the Closing Date with the same effect as though the same had been made on and as of such date.
6.Termination by Mutual Agreement. This Agreement may be terminated at any time by mutual consent of the parties hereto, provided that such consent to terminate is in writing and is signed by each of the parties hereto.
7.Release. Seller, on its own behalf and, to the extent of its legal authority, on behalf of its successors, assigns, heirs, next-of-kin, representatives, administrators, executors, partners, agents and affiliates, and any other person claiming by, through or under any of the foregoing (individually, a “Releasing Party”, and, collectively, “Releasing Parties”), hereby unconditionally and irrevocably releases, waives and forever discharges, effective as of the Closing hereunder, the Issuer, Phone Match, LLC, including its members, Mexedia, Inc., including its shareholder, and Mexedia DAC, including its shareholder, and each of their past and present respective officers, directors, employees, stockholders, predecessors, successors, assigns, partners, subsidiaries and affiliates (individually, a “Released Party”, and, collectively, “Released Parties”) from any and all claims, obligations, contracts, agreements, rights, debts, covenants and liabilities (including attorneys’ fees and costs) of any nature whatsoever, whether fixed or contingent, known or unknown, suspected or claimed to exist or unsuspected, regardless of whether knowledge of the unknown or unsuspected claim would have materially affected Seller’s decision to enter into this Agreement, both at law and in equity, arising directly or indirectly from any act, omission, event, or transaction occurring (or any facts or circumstances existing) on or prior to the Closing hereunder, but excluding claims for breach by the Issuer of any provision of this Agreement.
8.Miscellaneous.
(a)Entire Agreement. This Agreement constitutes the entire agreement of the parties, superseding and terminating any and all prior or contemporaneous oral and written agreements, understandings or letters of intent between or among the parties, with respect to the subject matter of this Agreement. No part of this Agreement may be modified or amended, nor may any right be waived, except by a written instrument which expressly refers to this Agreement, states that it is a modification or amendment of this Agreement and is signed by the parties to this Agreement, or, in the case of waiver, by the party granting the waiver. No course of conduct or dealing or trade usage or custom and no course of performance shall be relied on or referred to by any party to contradict, explain or supplement any provision of this Agreement, it being acknowledged by the parties to this Agreement that this Agreement is intended to be, and is, the complete and exclusive statement of the agreement with respect to its subject matter. Any waiver shall be limited to the express terms thereof and shall not be construed as a waiver of any other provisions or the same provisions at any other time or under any other circumstances.
(b)Severability. If any section, term or provision of this Agreement shall to any extent be held or determined to be invalid or unenforceable, the remaining sections, terms and provisions shall nevertheless continue in full force and effect.
(c)Notices. All notices provided for in this Agreement shall be in writing signed by the party giving such notice, and delivered personally or sent by overnight courier, mail or messenger against receipt thereof or sent by registered or certified mail, return receipt requested, or by facsimile transmission or similar means of communication if receipt is confirmed or if transmission of such notice is confirmed by mail as provided in this Section 6(c). Notices shall be deemed to have been received on the date of personal delivery or e-email or attempted delivery. Notice shall be delivered to the parties at the following addresses:
If to the Issuer:
7950 East Redfield Road, Unit 210, Scottsdale, Arizona 85260.
If to Seller:20311 Chartwell Center Drive, Suite 1469, Cornelius, North Carolina 28031.
Either party may, by like notice, change the address, person or telecopier number to which notice shall be sent.
(d)Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of North Carolina without regard to principles of conflicts of laws. Any action brought by either party against the other concerning the transactions contemplated by this Agreement shall be brought only in the state courts of North Carolina or in the federal courts located in the state and City of Charlotte, North Carolina. The parties to this Agreement hereby irrevocably waive any objection to jurisdiction and venue of any action instituted hereunder and shall not assert any defense based on lack of jurisdiction or venue or based upon forum non conveniens. The Issuer and the Seller waive trial by jury. The prevailing party shall be entitled to recover from the other party its reasonable attorney’s fees and costs. In the event that any provision of this Agreement or any other agreement 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 any agreement. Each party hereby irrevocably waives personal service of process and consents to process being served in any suit, action or proceeding in connection with this Agreement, any agreement or any other document delivered in connection with this Agreement by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by law.
(e)Successors. This Agreement shall be binding upon the parties and their respective heirs, executors, administrators, legal representatives, successors and assigns; provided, however, that neither party may assign this Agreement or any of its rights under this Agreement without the prior written consent of the other party.
(f)Further Assurances. Each party to this Agreement agrees, without cost or expense to any other party, to deliver or cause to be delivered such other documents and instruments as may be reasonably requested by any other party to this Agreement in order to carry out more fully the provisions of, and to consummate the transaction contemplated by, this Agreement.
(g)Counterparts. This Agreement may be executed simultaneously in two or more counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument. This Agreement and any documents relating to it may be executed and transmitted to any other party by facsimile or email of a PDF, which facsimile or PDF shall be deemed to be, and utilized in all respects as, an original, wet-inked document.
(h)No Strict Construction. The language used in this Agreement will be deemed to be the language chosen by the parties with the advice of counsel to express their mutual intent, and no rules of strict construction will be applied against any party.
(i)Headings. The headings in the Sections of this Agreement are inserted for convenience only and shall not constitute a part of this Agreement.
[ SIGNATURE PAGE FOLLOWS ]
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the date first above written.
ISSUER:SELLER:
RAADR, INC.JANBELLA GROUP, LLC
EXEMPLAREXEMPLAR
By: _______________________By: _______________________
Jacob DiMartinoWilliam Alessi
Chief Executive Officer
Managing Member
EXHIBIT A
Purchase Price of Subject Preferred Stock
Due to the difficulty in establishing a value for the businesses to be acquired by the Issuer in the Acquisitions, the Issuer and Seller have agreed to a minimum Purchase Price of $540,000.00 (the “Minimum Price”) and a maximum Purchase Price of $1,800,000.00 (the “Maximum Price”) for the Subject Preferred Stock. The Purchase Price shall be paid by the Issuer’s delivery of a secured promissory note (the “Redemption Note”), in the form of Annex I attached to this Exhibit A.
ANNEX I
Form of Redemption Note
NEITHER THE ISSUANCE NOR THE SALE OF THE SECURITIES REPRESENTED HEREBY 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 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, IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT.
SECURED PROMISSORY NOTE
Principal Amount: $540,000.00Issue Date: September ___, 2024
Raadr, Inc., a Nevada corporation (“Maker”), promises to pay to JanBella Group, LLC (“Holder”) the principal sum of Five Hundred Forty Thousand Dollars ($540,000.00) (the “Principal Balance”), together with interest accrued thereon calculated at the rate of eight percent (8%) per annum (the “Interest”), all as set forth herein (the “Note”).
The Principal Balance and accrued Interest shall be due and payable, as follows:
(A)within three (3) business days from the end of each calendar month during which Maker shall have received proceeds (each a “Monthly Reg A Tranche”) under Maker’s next-filed Offering Statement on Form 1-A (the “Regulation A Offering”), Maker shall pay Holder an amount that equals forty percent (40%) of each Monthly Reg A Tranche amount that exceeds $100,000, with each such payment being applied first to accrued Interest and then to the Principal Balance of this Note, until such time as all accrued Interest and the Principal Balance shall have been paid in full; and
(B)in any event, on or before September ___, 2025 (the “Maturity Date”).
Following the date of payment in full of the Principal Balance and all accrued Interest thereon (the “Balance Date”), Maker further promises to pay to Holder up to an additional $1,260,000 as additional principal (the “Additional Principal”). In this regard, within three (3) business days from Maker’s receipt of a Monthly Reg A Tranche after the Balance Date, Maker shall pay Holder an amount that equals ten percent (10%) of each Monthly Reg A Tranche amount that exceeds $100,000, until such time as all of the Additional Principal has been paid. Further, and in addition to the provisions of the foregoing sentence, for a period of 18 months immediately following the Issue Date, within three (3) business days from Maker's receipt of any third-party funding (the "Sourced Funding"), whether in the from of debt and/or equity, Maker shall pay Holder an amount that equals ten percent (10%) of the Sourced Funding amount, until such time as all of the Additional Principal has been paid. Maker shall incur no penalty for its failing to pay the Addition Principal amount in full.
Upon a default by Maker hereunder, the then-outstanding Principal Balance shall thereafter bear interest thereon at eighteen percent (18%) per annum (the “Default Rate”) until the past due amount, including interest at the Default Rate, shall have been paid in full.
In the event any payment called for by this Note would result in the violation of applicable usury laws, then any amount paid in excess of the maximum amount on interest allowed by law shall be applied towards a reduction of the outstanding principal balance.
The obligations of this Note are secured by (a) that certain Pledge Agreement dated as of the Issue Date among Holder, as lender, and Heritage Ventures Ltd., Gianluca Benedetti and Adama GmbH, as guarantors, and (b) that certain Guaranty dated as of the Issue Date among Holder, as lender, and Heritage Ventures Ltd., Gianluca Benedetti and Adama GmbH, as guarantors.
The occurrence of any one or more of the following events shall constitute a default under this Note:
(a)failure of Maker to file the Regulation A Offering within twenty (20) days from the Issue Date of this Note;
(b)failure of Maker to make any payment when due under this Note, with a grace period of two (2) business days;
(c)the filing of any petition under federal bankruptcy law or any similar federal or state statute by or against Maker;
(d)an application for the appointment of a receiver for, the making of a general assignment for the benefit of creditors by, or the insolvency of Maker;
(e)the validity or enforceability of this Note is contested by Maker; or
(f)Maker denies that it has any or any further liability or obligation hereunder.
This Note is and shall be deemed to have been made and delivered in the State of North Carolina and in all respects shall be governed and construed in accordance with the laws of that State.
This Note shall be governed by and construed in accordance with the laws of the State of North Carolina without regard to principles of conflicts of laws. Any action brought by either party against the other concerning the transactions contemplated by this Note shall be brought only in the state courts of North Carolina or in the federal courts located in the City of Charlotte, State of North Carolina. The parties to this Note hereby irrevocably waive any objection to jurisdiction and venue of any action instituted hereunder and shall not assert any defense based on lack of jurisdiction or venue or based upon forum non conveniens. The Borrower and Holder waive trial by jury. The prevailing party shall be entitled to recover from the other party its reasonable attorney’s fees and costs. In the event that any provision of this Note or any other agreement 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 any agreement. Each party hereby irrevocably waives personal service of process and consents to process being served in any suit, action or proceeding in connection with this Note, any agreement or any other document delivered in connection with this Note by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Note and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by law.
The word “Maker” shall include Maker’s representatives, successors and assigns and the word “Holder” shall include Holder’s representatives, successors and assigns.
Maker and all endorsers of this Note hereby waive presentment for payment, demand for payment, notice of non-payment and dishonor, protest, and notice of protest; consent to any renewals, extensions and partial payments of this Note or the indebtedness for which it is given without notice to them, and consent that no such renewals, extensions or partial payments shall discharge any party hereto from liability hereon in whole or in part.
If this Note shall be placed with an attorney for collection, Maker, endorsers and guarantors agree to pay all costs of collection, including reasonable attorneys’ fees which shall be added to the amount due under this Note and shall be recoverable with the amount due under this Note and shall be a lien on any collateral securing this Note.
Maker acknowledges and agrees that sufficient consideration has passed to render this Note valid and enforceable and waives any claim based on inadequate consideration.
IN WITNESS WHEREOF, Maker has executed this Note as of the date first above set forth.
RAADR, INC.
EXEMPLAR
By: ___________________________
Jacob DiMartino
Chief Executive Officer
EXHIBIT B
Form of Pledge Agreement
PLEDGE AGREEMENT
This Pledge Agreement (the “Agreement”) is made and entered as of September ___, 2024, by and among Mexedia S.p.A. S.B. (“Guarantor”), JanBella Group, LLC, a North Carolina limited liability company (“Lender”), and the undersigned holder of the pledged shares (“Pledge Holder”).
RECITALS
Raadr, Inc., a Nevada corporation (the “Company”), issued a Secured Promissory Note, dated as of the date of this Agreement (the “Redemption Note”) to Lender, whereby the Company owes payment obligations to Lender.
Guarantor has agreed to secure the Company’s payment obligations to Lender under the Redemption Note with a guaranty and a pledge of, and thereby create a security interest in favor of Lender in, a total of 75,000 shares of Series F Preferred Stock of the Company (the “Shares”), the Shares representing 100% of the issued and outstanding shares of Series F Preferred Stock of the Company.
AGREEMENT
1.Security Interest. Guarantor hereby grants to Lender a security interest in (a) the Shares, (b) all Dividends (as defined below), and (c) all Additional Securities (as defined below); to secure payment of the Redemption Note and performance of all Guarantor’s obligations under this Agreement. For purposes of this Agreement, the Shares, all Dividends and all Additional Securities will be collectively referred to as the “Collateral”. If any stock dividend, reclassification, readjustment, stock split or other change is declared or made with respect to the Collateral, or if warrants or any other rights, options or securities are issued in respect of the Collateral (“Additional Securities”), then all new, substituted and/or additional shares or other securities issued by reason of such change or by reason of the exercise of such warrants, rights, options or securities, will be (if delivered to Guarantor, immediately surrendered to Lender care of the Pledge Holder and) pledged to Lender to be held under the terms of this Agreement as and in the same manner as the Collateral is held hereunder.
2.Appointment of the Pledge Holder. Guarantor and Lender hereby designate and appoint the Pledge Holder as such for the purposes hereinafter set forth. Guarantor hereby deposits with the Pledge Holder (a) the Shares, as are represented by the book entry statement in the name of Guarantor, (b) the original Stock Power, copies of which are attached hereto as Exhibit A, and (c) documentation waiving the Medallion Signature Guaranty requirement signed by the Company and Manhattan Transfer Registrar Co., in form satisfactory to Lender.
3.Rights and Obligations of the Pledge Holder.
(a)Guarantor and Lender hereby authorize the Pledge Holder to keep and preserve the Shares in its possession pending payment in full of the Redemption Note. If a default occurs under the terms of this Agreement or the Redemption Note, then Lender shall provide written notice to Guarantor and the Company specifying the default and shall, subject to Section 3(b) hereof, have the right to direct the Pledge Holder to transfer the Shares to the Lender or its designee if Guarantor and/or the Company has not cured the default within 15 days after receipt of the notice. In such event, the Pledge Holder, acting as agent of Lender, shall, with respect to the Shares, exercise the rights and duties of a Secured Party under the Uniform Commercial Code as enacted in Nevada (the “UCC”), and under any other applicable law as the same may, from time to time, be in effect. Guarantor agrees that any notice by Pledge Holder concerning the sale, disposition or other intended action in connection with the Shares, whether required by the UCC, or otherwise shall constitute reasonable notice to Guarantor if such notice is mailed by registered mail or certified mail, return receipt requested, postage prepaid at least ten days prior to such action.
(b)Notwithstanding anything contained herein to the contrary, in no event shall the Lender, or any affiliate of the Lender, be entitled to exercise incidents of ownership over, own, or convert any portion of the Shares in excess of that portion of Shares that upon conversion of which the sum of: (1) the number of shares of common stock of the Company (the “Common Stock”) beneficially owned by the Lender and its affiliates (other than shares of Common Stock which may be deemed beneficially owned through the ownership of the unconverted portion of any securities of the Company or the unexercised or unconverted portion of any other security of the Company subject to a limitation on conversion or exercise analogous to the limitations contained herein) and (2) the number of shares of Common Stock issuable upon the conversion of the portion of the Shares with respect to which the determination of this proviso is being made, would result in beneficial ownership by the Lender and its affiliates of more than 9.99% of the outstanding shares of Common Stock. For purposes of the proviso to the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and Regulations 13D-G thereunder, except as otherwise provided in clause (1) of such proviso, provided, however, that the limitations set forth in this Section 3(b) may be waived by the Lender only upon, at the election of the Lender, not less than 61 days’ prior notice to the Company and the Pledge Holder, and the provisions of the conversion limitation shall continue to apply until such 61st day (or such later date, as determined by the Lender, as may be specified in such notice of waiver).
4.Disposition of Shares. Upon any disposition of the Shares by Pledge Holder in accordance with the terms of Section 3 (Rights and Obligations of the Pledge Holder), Lender shall be entitled to all of the proceeds of any such disposition.
5.Rights of Beneficial Ownership. Upon an event of default under the Redemption Note, and subject to Section 3(b), Lender shall be deemed the beneficial owner of the Shares and shall have all rights and benefits incident thereto. Lender and Guarantors, and each of them, agree to execute any necessary proxies or other documents to effectuate this right. So long as Guarantor owns the Shares and no event of default has occurred under the Redemption Note, Guarantor shall be entitled to vote any shares comprising the Collateral, subject to any proxies granted by Guarantor.
6.Covenants of Guarantor. Guarantor hereby represents and warrants to Lender that Guarantor has good title (both record and beneficial) to the Collateral, free and clear of all claims, pledges, security interests, liens or encumbrances of every nature whatsoever, and that Guarantor has the right to pledge and grant Lender the security interest in the Collateral granted under this Agreement. Guarantor agrees that, until all sums due under the Redemption Note have been paid in full, Guarantor will not: (a) sell, assign or transfer, or attempt to sell, assign or transfer, any of the Collateral, (b) grant or create, or attempt to grant or create, any security interest, lien, pledge, claim or other encumbrance with respect to any of the Collateral, (c) suffer or permit to continue upon any of the Collateral during the term of this Agreement, an attachment, levy, execution or statutory lien, (d) permit the issuance of any equity of the Company or any other security of the Company which diminishes the value, or rights and preferences of the Shares or otherwise make any change to its capitalization; or (e) amend the rights and preferences of the Shares.
There shall be no substitution of collateral under the terms of this Agreement, without the prior written consent of Lender.
Guarantor hereby agrees to indemnify Lender and Pledge Holder against any direct loss, reasonable cost or out-of-pocket expense incurred by holder in connection with the Redemption Note and Agreement and the exercise of any and all rights pertaining thereto, including, without limitation, all court costs, reasonable attorney’s fees and other costs of collection.
7.Disputes. In the event of a dispute with respect to the terms and provisions of this Agreement, Pledge Holder shall not be required to resolve that dispute or take any action with respect thereto. Pledge Holder may continue to hold the Shares and await final resolution of the dispute by joint written instructions from Guarantor and Lender or by a final determination of a court or arbitration panel of competent jurisdiction. In the alternative, Pledge Holder may deliver the Shares to a court of proper jurisdiction under an appropriate action in interpleader and thereupon be relieved of all responsibility under this Agreement.
8.Release of Shares. When satisfactory proof has been presented to Pledge Holder that all amounts due under the Redemption Note (including accrued interest thereon) have been paid, Pledge Holder shall deliver the Shares with stock power attached to Guarantor and all obligations by and among Guarantor, Lender and Pledge Holder under this Agreement shall thereupon cease.
9.Conduct of Pledge Holder. Pledge Holder shall not be required to exercise any standard of care greater than ordinary care in discharging its duties and obligations under this Agreement and Pledge Holder shall not incur any liability to anyone for any damages, losses or expenses with respect to any action taken or omitted in good faith. Pledge Holder shall have no duties other than those expressly imposed herein. Pledge Holder may rely and shall be protected in relying upon any paper or other document that may be submitted to it in connection with its duties hereunder and that it believes to be genuine and to have been signed or presented by the proper party or parties and shall have no liability or responsibility with respect to the form, execution or validity thereof. Pledge Holder may resign as
such following the giving of 30 days prior written notice to the other parties hereto. Similarly, Pledge Holder may be removed and replaced following the giving of 30-days’ prior written notice to Pledge Holder by the other parties hereto. In either event, the duties of Pledge Holder shall terminate 30 days after receipt of such notice (or as of such earlier date as may be mutually agreeable), and Pledge Holder shall then deliver the Shares and any other related materials then in its possession to a successor pledge holder as shall be appointed by the other parties hereto as evidenced by a written notice filed with Pledge Holder. If the other parties hereto have failed to appoint a successor prior to the expiration of 30 days following receipt of the notice of resignation or removal, Pledge Holder may appoint a successor or petition any court of competent jurisdiction for the appointment of a successor pledge holder or for other appropriate relief, and any such resulting appointment shall be binding upon all of the parties hereto.
10.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 (a) personally served, (b) deposited in the mail, registered or certified, return receipt requested, postage prepaid, (c) delivered by reputable air courier service with charges prepaid, or (d) transmitted by hand delivery, telegram, e-mail or facsimile, addressed as set forth below or to such other address as such party shall have specified most recently by written notice. Any notice or other communication required or permitted to be given hereunder shall be deemed effective (1) upon hand delivery or delivery by e-mail or facsimile, with accurate confirmation generated by the transmitting facsimile machine, at the address or number 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) or (2) on the second business day following the date of mailing by express courier service, fully prepaid, addressed to such address, or upon actual receipt of such mailing, whichever shall first occur. The addresses for such communications shall be:
If to Lender:JanBella Group, LLC, Attention: William Alessi
20311 Chartwell Center Drive, Suite 1469, Cornelius, NC 28031
E-mail: balessi@alphamodus.com
If to Guarantor:Attention: Orlando Taddeo
Via di Affogalasino, 105 - 00148 Roma RM
E-mail: otaddeo@mexedia.com
If to Pledge Holder:Newlan Law Firm, PLLC, Attention: Eric Newlan
2201 Long Prairie Road, Suite 107-762, Flower Mound, Texas 75022
E-mail: eric@newlanpllc.com
11.Wavier. No delay or omission by Lender in exercising any right or remedy hereunder shall operate as a waiver thereof or of any right or remedy, and no single or partial exercise thereof shall preclude any other or further exercise thereof or the exercise of any other right or remedy. All rights and remedies of Lender hereunder are cumulative.
12.General. No modification, rescission, waiver, release or amendment of any provision of this Agreement shall be made except by written agreement subscribed by Guarantor and Lender. An executed original of any such agreement shall be delivered to the Pledge Holder upon its execution and if such agreement affects the right, duties or obligations of the Pledge Holder under this Agreement, it must also be executed and agreed to by the Pledge Holder before the same shall have any legal effect. This Agreement shall be governed under the laws of the State of North Carolina without regard to conflict of law principles; and any action with respect to this Agreement shall be bought in the State of North Carolina, County of Mecklenburg. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Except as required by law, each party to this Agreement shall keep this Agreement, the Redemption Note and the transactions contemplated by these agreements strictly confidential.
IN WITNESS WHEREOF, the parties have executed and delivered this Pledge Agreement on the date first set forth above.
GUARANTOR:
MEXEDIA S.p.A. S.B.
EXEMPLAR
By: __________________________
Orlando Taddeo
President
| LENDER:
JANBELLA GROUP, LLC
EXEMPLAR
By: ______________________________
William Alessi
Managing Member
PLEDGE HOLDER:
NEWLAN LAW FIRM, PLLC
EXEMPLAR
By: _____________________________
Eric Newlan
Managing Member
|
ACKNOWLEDGED AND AGREED BY THE COMPANY:
RAADR, INC.
EXEMPLAR
By: ________________________________________
Jacob DiMartino
Chief Executive Officer
EXHIBIT C
Form of Guaranty
GUARANTY
This Guaranty, dated as of September ___, 2024, is made by and between Mexedia S.p.A. S.B. (“Guarantor”), and JanBella Group, LLC, a North Carolina limited liability company (“Lender”).
RECITALS
On September ___, 2024, Raadr, Inc., a Nevada corporation (“Borrower”), issued a Secured Promissory Note (the “Redemption Note”) in the principal amount of $540,000.00. A material element of the Redemption Note is, among others, the delivery of a pledge agreement (the “Pledge Agreement”) dated the date hereof by and among Guarantor, Borrower and Lender, whereby Guarantor pledged a total of 75,000 shares of Series F Preferred Stock of the Company (the “Pledged Securities”), to secure the performance when due of all obligations of Borrower pursuant to the Note and this Guaranty.
NOW, THEREFORE, in consideration of the premises and in order to induce Lender to consummate the transactions contemplated by the Agreement, Guarantor hereby agrees as follows:
1.Guaranty. Guarantor hereby unconditionally and irrevocably guarantees the full and prompt performance when due of all obligations of Borrower under the Note (the “Obligations”).
2.Guaranty Absolute. Guarantors, and each of them, guarantee that the Obligations will be performed strictly in accordance with their terms, regardless of any law, regulation or order now or hereafter in effect in any jurisdiction affecting any of such terms or the rights of Lender with respect thereto; and if such Obligations are not performed accordingly, Guarantor hereby unconditionally and irrevocably guarantees the full and prompt performance when due of all Obligations (including, but not limited to, payment). The liability of Guarantor is primary, direct and independent of the obligations of Borrower pursuant to the Note. This Guaranty shall be enforceable against Guarantor in the same manner as if Guarantor were the primary obligor. The liability of Guarantor under this Guaranty shall be absolute and unconditional irrespective of:
(a)any change in the time, manner or place of payment of, or in any other term of, all or any of the Obligations, or any other amendment or waiver of or any consent to departure thereof;
(b)any defense which Guarantor may assert including, but not limited to, failure of consideration, breach of warranty, fraud, payment, statute of frauds, bankruptcy, lack of legal capacity, statute of limitations, lender liability, accord and satisfaction and usury; or
(c)any other circumstance which might otherwise constitute a defense available to, or a discharge
of, Guarantor.
None of the foregoing waivers shall prejudice Lender’s rights under the Note. This Guaranty shall continue to be effective or be reinstated, as the case may be, if at any time any payment of any of the Obligations is rescinded or must otherwise be returned by Lender upon the insolvency, bankruptcy or reorganization of Borrower or otherwise, all as though such payment had not been made.
Notwithstanding any of the foregoing provisions of this Section 2 to the contrary, should Guarantor deliver the Pledged Securities to Lender in accordance with the terms of the Pledge Agreement upon Borrower’s failure to fully and promptly perform its Obligations under the Note, then Guarantor’s guaranty hereunder shall be deemed to be fully satisfied and Guarantor shall have no further liability to Lender hereunder.
3.Matters Being Waived. Guarantor hereby waives promptness, diligence, notice of acceptance, and any other notice with respect to any of the obligations of the Note and this Guaranty and any requirement that Lender exhausts any right or take any action against Borrower or any other person or entity or any collateral.
4.Governing Law. This Guaranty shall be governed by and construed in accordance with the laws of the State of North Carolina without regard to principles of conflicts of laws. Any action brought by either party against the other concerning the transactions contemplated by this Guaranty shall be brought only in the state courts of North Carolina or in the federal courts located in the state and City of Charlotte, North Carolina. The parties to this Guaranty hereby irrevocably waive any objection to jurisdiction and venue of any action instituted hereunder and shall not assert any defense based on lack of jurisdiction or venue or based upon forum non conveniens. Guarantor waives trial by jury. The prevailing party shall be entitled to recover from the other party its reasonable attorney’s fees and costs. In the event that any provision of this Guaranty or any other agreement 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 any agreement. Each party hereby irrevocably waives personal service of process and consents to process being served in any suit, action or proceeding in connection with this Guaranty, any agreement or any other document delivered in connection with this Guaranty by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Guaranty and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by law.
5.Miscellaneous Provisions.
(a)Amendments. No amendment or waiver of any provision of this Guaranty nor consent to any departure by Guarantors therefrom shall in any event be effective unless the same shall be in writing and signed by Lender and then such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given.
(b)No Waiver; Remedies. No failure on the part of Lender to exercise, and no delay in exercising, any right hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right hereunder preclude any other or further exercise thereof or the exercise of any other right. The remedies herein provided are cumulative and not exclusive of any remedies provided by law.
(c)Headings. The headings herein are for convenience only and shall not limit or define the meaning of the provisions of this Guaranty.
(d)Severability. If any provision of this Guaranty for any reason shall be held to be illegal,
invalid or unenforceable, such illegality shall not affect any other provision of this Guaranty, this Guaranty shall be amended so as to enforce the illegal, invalid or unenforceable provision to the maximum extent permitted by applicable law, and the parties shall cooperate in good faith to further modify this Guaranty so as to preserve to the maximum extent possible the intended benefits to be received by the parties.
(e)Continuing Guaranty. This Guaranty is a continuing guaranty and shall (1) remain in full force and effect until payment in full of the obligations of the Note and all other amounts payable under this Guaranty, (2) be binding upon Guarantors, and each of them, their respective successors and respective assigns, and (3) inure to the benefit of and be enforceable by Lender and its successors, transferees and assigns.
IN WITNESS WHEREOF, Guarantors have duly executed, or caused to be duly executed, and delivered this Guaranty as of the date first above written.
GUARANTOR:
MEXEDIA S.p.A. S.B.
EXEMPLAR
By: __________________________
Orlando Taddeo
President
EXHIBIT D
Trade Payables of RDAR
To remain RDAR obligations:
Michael Handelman (CPA)$6,000.00
Manhattan Transfer Registrar Co.$6,005.00
To be assigned by RDAR to new subsidiary post-closing:
Cooperative Computing (App developer)$30,000.00
EXHIBIT E
Form of Closing Certificate of RDAR
CERTIFICATE OF THE COMPANY
[Pursuant to Section 7.1(a) of the Share Exchange Agreement]
The undersigned, Jacob DiMartino, the duly elected and acting Chief Executive Officer of Raadr, Inc., a Nevada corporation (the “Company”), hereby certifies and affirms that each of the following is true and correct:
1.The representations and warranties of the Company contained in that certain Share Exchange Agreement (the “Exchange Agreement”) to which this Certificate relates are true and correct in all material respects on the date of this Certificate and, except for those representations and warranties which address matters only as of a particular date, with the same force and effect as if made as of this date.
2.The Company is a corporation duly organized and existing under the laws of the State of Nevada, and has the power and authority to own its properties and carry on its business in the manner in which such business is conducted.
3.The execution, delivery and performance by the Company of the Exchange Agreement, in accordance with the terms and provisions of the Exchange Agreement, have been duly authorized by appropriate corporate action of the Company.
4.The Company has full power, right and authority to enter into the Exchange Agreement and to perform their respective obligations under the Exchange Agreement, and the Exchange Agreement is the legal, valid and binding obligation of the Company and is enforceable against the Company in accordance with its terms.
5.The Exchange Shares of the Company to be issued pursuant to the Exchange Agreement will be, upon issuance and delivery pursuant to the terms of the Exchange Agreement, validly issued, fully paid and non-assessable.
Certified and affirmed this ____ day of September, 2024.
RAADR, INC.
EXEMPLAR
By: __________________________
Jacob DiMartino
Chief Executive Officer
EXHIBIT F
Form of Closing Certificate of Acquired Company and the Owner
CERTIFICATE OF ACQUIRED COMPANY AND THE OWNER
[Pursuant to Section 7.2(a) of the Share Exchange Agreement]
The undersigned hereby certify and affirm that each of the following is true and correct:
1.The representations and warranties of Mexedia Inc., a Florida corporation (the “Acquired Company”), in that certain Share Exchange Agreement (the “Exchange Agreement”) to which this Certificate relates are true and correct in all material respects on the date of this Certificate and, except for those representations and warranties which address matters only as of a particular date, with the same force and effect as if made as of this date.
2.Acquired Company is a corporation duly organized and existing under the laws of the Florida, and has the corporate power and authority to own its properties and carry on its business in the manner in which such business is conducted.
3.The execution, delivery and performance by Acquired Company of the Exchange Agreement, in accordance with its terms and provisions, have been duly authorized by appropriate corporate action of Acquired Company.
4.Acquired Company has full power, right and authority to enter into the Exchange Agreement and to perform its obligations under the Exchange Agreement and the Exchange Agreement is the legal, valid and binding obligation of Acquired Company and is enforceable against Acquired Company in accordance with its terms.
5.The Ownership Interest of Acquired Company that is the subject to the Exchange Agreement is fully paid and non-assessable and, when transferred and sold on the Closing Date of the Exchange Agreement, will be free and clear of any liens, claims and encumbrances.
6.Acquired Company and the Owner have each performed or complied with, in all material respects, all agreements and covenants required of them by the Exchange Agreement to which this Certificate relates.
Certified and affirmed this ___ day of September, 2024.
| OWNER:
MEXEDIA S.p.A. S.B.
EXEMPLAR
By: __________________________
Orlando Taddeo
President
| ACQUIRED COMPANY:
MEXEDIA INC.
EXEMPLAR
By: __________________________
Orlando Taddeo
President
|
AMENDMENT NO. 1
TO
SHARE EXCHANGE AGREEMENT
This constitutes Amendment No. 1 to that certain Share Exchange Agreement (the “Agreement”) dated as of September 9, 2024, by and among Raadr, Inc., a Nevada corporation (“RDAR”), Mexedia Inc., a Florida corporation (“Acquired Company”), and Mexedia S.p.A. S.B., the owner of Acquired Company (the “Owner”). Capitalized terms herein shall have the same meanings as set forth in the Agreement.
For good and adequate consideration, the receipt and adequacy of which is hereby acknowledged, RDAR, Acquired Company and Owner agree, as follows:
A.Section 1.2 of the Agreement is hereby deleted in its entirety and replaced with the following:
1.2Closing. Unless this Agreement shall have been terminated and the transactions herein contemplated shall have been abandoned pursuant to Article VIII, the closing date of the Exchange (the “Closing”) will take place on the business day upon satisfaction of the conditions set forth in Article VI (or as soon as practicable thereafter following satisfaction or waiver of the conditions set forth in Article VI) (the “Closing Date”), at such time and location as may be agreed upon by RDAR and Acquired Company; provided, however, that the Closing shall take place no later than February 28, 2025.
B.Section 8.(c) of the Agreement is hereby deleted in its entirety and replaced with the following:
(c)by either RDAR or Acquired Company if the Share Exchange shall not have been consummated on or before February 28, 2025 (other than as a result of the failure of the party seeking to terminate this Agreement to perform its obligations under this Agreement required to be performed at or prior to the Effective Time).
In all other aspects, the Agreement is ratified and affirmed as of the 28th day of September, 2024.
[ SIGNATURE PAGE FOLLOWS ]
MEXEDIA, INC. AMENDMENT NO. 1 TO SHARE EXCHANGE AGREEMENT | PAGE 1
[ SIGNATURE PAGE TO AMENDMENT NO. 1 TO SHARE EXCHANGE AGREEMENT ]
IN WITNESS WHEREOF, the undersigned have caused their duly authorized officers to execute this Amendment No. 1 to Share Exchange Agreement as of the date first above written.
RDAR:ACQUIRED COMPANY:
RAADR, INC.MEXEDIA INC.
By: /s/ Jacob DiMartinoBy: /s/ Orlando Taddeo
Jacob DiMartinoOrlando Taddeo
Chief Executive OfficerPresident
E-Mail: jacob.d@raadr.comE-Mail: otaddeo@mexedia.com
OWNER:
MEXEDIA S.p.A. S.B.
By: /s/ Orlando Taddeo
Orlando Taddeo
President
E-Mail: otaddeo@mexedia.com
MEXEDIA, INC. AMENDMENT NO. 1 TO SHARE EXCHANGE AGREEMENT | PAGE 2
SHARE EXCHANGE AGREEMENT
This Share Exchange Agreement (this “Agreement”) is entered into as of this 9th day of September, 2024, by and among Raadr, Inc., a Nevada corporation (“RDAR”), Mexedia DAC, a Republic of Ireland corporation (“Acquired Company”), and Mexedia S.p.A. S.B., the owner of Acquired Company (the “Owner”).
RECITALS
WHEREAS, this Agreement is one of a series of agreements that would, when consummated, result in the Company’s (a) having acquired businesses and assets valued in excess of USD$60,000,000 and (b) having undergone a change in control (collectively, the “Change-in-Control Agreements”); and
WHEREAS, the Boards of Directors of RDAR, Acquired Company and the Owner have determined that an acquisition of all of the issued and outstanding shares of capital stock of Acquired Company by RDAR through a share exchange upon the terms and subject to the conditions set forth in this Agreement (the “Share Exchange”) would be in the best interests of RDAR, Acquired Company and the Owner; and
WHEREAS, and the Boards of Directors of RDAR and Acquired Company have each approved the Share Exchange; and
WHEREAS, this Agreement is under consideration by the Board of Directors of the Owner for formal determination and approval; and
WHEREAS, pursuant to the Share Exchange, all of the right, title and interest in and to all of the issued and outstanding shares of capital stock of Acquired Company (the “Ownership Interest”) will be exchanged for 30,000 shares of Series F Preferred Stock of RDAR, the Certificate of Designation of which is attached hereto as Exhibit A, including the common stock into which such shares may be converted (the “Exchange Shares”); and
WHEREAS, RDAR, Acquired Company and the Owner desire to make certain representations, warranties, covenants and agreements in connection with the Share Exchange and also to prescribe various conditions to the Share Exchange.
NOW, THEREFORE, in consideration of the representations, warranties, covenants and agreements contained in this Agreement, the parties agree as follows:
Article I.
The Exchange
1.1Share Exchange. Upon the terms and subject to the conditions set forth in this Agreement, and in accordance with the Nevada Revised Statutes (the “Nevada Statutes”), at the Closing (defined below), the parties shall do the following:
MEXEDIA DAC SHARE EXCHANGE AGREEMENT | PAGE 1
(a)Acquired Company shall cause the Owner to convey, assign and transfer the Ownership Interest to RDAR by delivering to RDAR duly executed assignments in proper form for transfer. The Ownership Interest transferred to RDAR at the Closing shall constitute 100% of the issued and outstanding shares of capital stock of Acquired Company.
(b)As consideration for its acquisition of the Ownership Interest, RDAR shall issue the Exchange Shares to the Owner by delivering a book entry record to the Owner evidencing the Exchange Shares (the “Exchange Shares Certificate”).
1.2Closing. Unless this Agreement shall have been terminated and the transactions herein contemplated shall have been abandoned pursuant to Article VIII, the closing date of the Exchange (the “Closing”) will take place on the business day upon satisfaction of the conditions set forth in Article VI (or as soon as practicable thereafter following satisfaction or waiver of the conditions set forth in Article VI) (the “Closing Date”), at such time and location as may be agreed upon by RDAR and Acquired Company; provided, however, that the Closing shall take place no later than January 31, 2025.
1.3Reorganization.
(a)As of the Closing, Jacob DiMartino shall resign as RDAR’s sole director and officer and Orlando Taddeo shall be appointed as the sole director and officer of RDAR.
(b)If at any time after the Closing, any party shall consider that any further deeds, assignments, conveyances, agreements, documents, instruments or assurances in law or any other things are necessary or desirable to vest, perfect, confirm or record in RDAR the title to any property, rights, privileges, powers and franchises of Acquired Company by reason of, or as a result of, the Share Exchange, or otherwise to carry out the provisions of this Agreement, the remaining parties, as applicable, shall execute and deliver, upon request, any instruments or assurances, and do all other things necessary or proper to vest, perfect, confirm or record title to such property, rights, privileges, powers and franchises in RDAR, and otherwise to carry out the provisions of this Agreement.
Article II.
Compliance with Applicable Securities Laws
2.1Covenants, Representations and Warranties of the Owner.
(a)The Owner acknowledges and agrees that it is acquiring the Exchange Shares for investment purposes and will not offer, sell or otherwise transfer, pledge or hypothecate any of the Exchange Shares issued to them (other than pursuant to an effective Registration Statement under the Securities Act of 1933, as amended (the “Securities Act”)), directly or indirectly unless:
(1)the sale is to RDAR; or
(2)the Exchange Shares are sold in a transaction that does not require registration under the Securities Act, or any applicable United States state laws and regulations governing the offer and sale of securities, and the seller has furnished to RDAR an opinion of counsel to that effect or such other written opinion as may be reasonably required by RDAR.
(b)The Owner acknowledges and agrees that the book entry record representing the Exchange Shares shall bear a restrictive legend, substantially in the following form:
MEXEDIA DAC SHARE EXCHANGE AGREEMENT | PAGE 2
“THE SECURITIES REPRESENTED BY THIS STOCK CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”) OR APPLICABLE STATE SECURITIES LAWS, AND SHALL NOT BE SOLD, PLEDGED, HYPOTHECATED, DONATED, OR OTHERWISE TRANSFERRED (WHETHER OR NOT FOR CONSIDERATION) BY THE HOLDER EXCEPT UPON THE ISSUANCE TO THE COMPANY OF A FAVORABLE OPINION OF ITS COUNSEL OR THE SUBMISSION TO THE COMPANY OF SUCH OTHER EVIDENCE AS MAY BE SATISFACTORY TO COUNSEL FOR THE COMPANY, TO THE EFFECT THAT ANY SUCH TRANSFER SHALL NOT BE IN VIOLATION OF THE SECURITIES ACT OR APPLICABLE STATE SECURITIES LAWS.”
(c)The Owner represents and warrants that it:
(1)is not aware of any advertisement of, or other form or general solicitation with respect to, any of the Exchange Shares being issued hereunder;
(2)acknowledges and agrees that RDAR will refuse to register any transfer of the Exchange Shares not made pursuant to an effective registration statement under the Securities Act or pursuant to an available exemption from the registration requirements of the Securities Act and in accordance with applicable state and provincial securities laws; and
(3)acknowledges and agrees to RDAR making a notation on its records or giving instructions to the registrar and transfer agent of RDAR in order to implement the restrictions on transfer set forth and described herein.
Article III.
Representations and Warranties
3.1Representations and Warranties of Acquired Company and the Owner. As a material inducement for RDAR to enter into this Agreement and to consummate the transactions contemplated hereby, Acquired Company and the Owner hereby make the following representations and warranties as of the date hereof and as of the Closing Date, each of which is relied upon by RDAR regardless of any investigation made or information obtained by RDAR (unless and to the extent specifically and expressly waived in writing by RDAR on or before the Closing Date):
(a)Organization, Standing and Power; No Disability. Acquired Company is duly organized, validly existing and in good standing under the laws of the Republic of Ireland. The Owner is duly organized, validly existing and in good standing under the laws of its organization.
(b)Subsidiaries. Acquired Company does not own, directly or indirectly, any equity or other ownership interest in any company, corporation, partnership, joint venture or otherwise.
(c)Corporate Documents. Schedule 3.1(c) contains true and correct copies of the Articles of Incorporation and bylaws of Acquired Company, each as amended to date.
(d)Ownership Interest. The Ownership Interest represents 100% of the issued and outstanding shares of capital stock of Acquired Company. Acquired Company also warrants that there are no outstanding bonds, debentures, notes or other indebtedness or other securities of Acquired Company. There are no rights, commitments, agreements, arrangements or undertakings of any kind to which Acquired Company is a party or by which it is bound obligating Acquired Company to issue, deliver or sell, or cause to be issued, delivered or sold, additional ownership interests of Acquired Company or obligating Acquired Company to issue, grant, extend or enter into any such right, commitment, agreement, arrangement or undertaking. There are
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no outstanding contractual obligations, commitments, understandings or arrangements of Acquired Company to repurchase, redeem or otherwise acquire or make any payment in respect of the capital stock of Acquired Company.
(e)Capitalization of Acquired Company. Schedule 3(e) sets forth the issued and outstanding shares of capital stock of Acquired Company (the Ownership Interest). All of Acquired Company’s issued and outstanding shares of capital stock have been duly authorized, are validly issued, fully paid and non-assessable.
(f)Authority; Non-contravention. Acquired Company and the Owner have all requisite power and authority to enter into this Agreement and to consummate the transactions contemplated by this Agreement. The execution and delivery of this Agreement by Acquired Company and its Owner and the consummation by Acquired Company and the Owner of the transactions contemplated hereby have been (or at Closing will have been) duly authorized by all necessary action on the part of Acquired Company. This Agreement has been duly executed and when delivered by Acquired Company and the Owner shall constitute a valid and binding obligation of Acquired Company and the Owner, enforceable against Acquired Company and the Owner, as applicable, in accordance with its terms, except as such enforcement may be limited by bankruptcy, insolvency or other similar laws affecting the enforcement of creditors’ rights generally or by general principles of equity. The execution and delivery of this Agreement does not, and the consummation of the transactions contemplated by this Agreement and compliance with the provisions hereof will not, conflict with, or result in any breach or violation of, or default (with or without notice or lapse of time, or both) under, or give rise to a right of termination, cancellation or acceleration of or “put” right with respect to any obligation or to a loss of a material benefit under, or result in the creation of any lien upon any of the properties or assets of Acquired Company under, (1) the articles of incorporation or bylaws of Acquired Company, (2) any loan or credit agreement, note, bond, mortgage, indenture, lease or other agreement, instrument, permit, concession, franchise or license applicable to Acquired Company, its properties or assets, or (3) subject to the governmental filings and other matters referred to in the following sentence, any judgment, order, decree, statute, law, ordinance, rule, regulation or arbitration award applicable to Acquired Company, its properties or assets, other than, in the case of clauses (ii) and (iii), any such conflicts, breaches, violations, defaults, rights, losses or liens that individually or in the aggregate could not have a material adverse effect with respect to Acquired Company or could not prevent, hinder or materially delay the ability of Acquired Company to consummate the transactions contemplated by this Agreement.
(g)Governmental Authorization. No consent, approval, order or authorization of, or registration, declaration or filing with, or notice to, any United States court, administrative agency or commission, or other federal, state or local government or other governmental authority, agency, domestic or foreign (a “Governmental Entity”), is required by or with respect to Acquired Company in connection with the execution and delivery of this Agreement by Acquired Company or the consummation by Acquired Company of the transactions contemplated hereby, except, with respect to this Agreement, any filings under the Securities Act or the Securities Exchange Act of 1934 and the rules and regulations promulgated thereunder (the “Exchange Act”) or pursuant to the rules of OTC Markets.
(h)Financial Statements.
(1)At Closing, RDAR will have received from Acquired Company a copy of its unaudited financial statements for the years ended December 31, 2023 and 2022, and for the six months ended June 30, 2024 (collectively, the “Acquired Company Financial Statements”). The Acquired Company Financial Statements fairly present the financial condition of Acquired Company at the dates indicated and its results of operations and cash flows for the periods then ended and, except as indicated therein, reflect all
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claims, debts and liabilities of Acquired Company, fixed or contingent, and of whatever nature.
(2)Since June 30, 2024, there has been no material adverse change in the assets or liabilities, or in the business or condition, financial or otherwise, or in the results of operations or prospects, of Acquired Company, whether as a result of any legislative or regulatory change, revocation of any license or rights to do business, fire, explosion, accident, casualty, labor trouble, flood, drought, riot, storm, condemnation, act of God, public force or otherwise and no material adverse change in the assets or liabilities, or in the business or condition, financial or otherwise, or in the results of operation or prospects, of Acquired Company except in the ordinary course of business.
(3)Since June 30, 2024, Acquired Company has not issued, sold or otherwise disposed of, or agreed to issue, sell or otherwise dispose of, any securities of Acquired Company, and has not granted or agreed to grant any other right to subscribe for or to purchase any securities of Acquired Company or has incurred or agreed to incur any indebtedness for borrowed money.
(i)Absence of Certain Changes or Events. Since June 30, 2024, Acquired Company has conducted its business only in the ordinary course consistent with past practice, and there is not and has not been any:
(1)material adverse change with respect to Acquired Company including any amendments to its formation and governance documents;
(2)event which, if it had taken place following the execution of this Agreement, would not have been permitted by Section 4.1 without prior consent of RDAR;
(3)condition, event or occurrence which could reasonably be expected to prevent, hinder or materially delay the ability of Acquired Company to consummate the transactions contemplated by this Agreement;
(4)incurrence, assumption or guarantee by Acquired Company of any indebtedness for borrowed money other than in the ordinary course and in amounts and on terms consistent with past practices or as disclosed to RDAR in writing;
(5)creation or other incurrence by Acquired Company of any lien on any asset other than in the ordinary course consistent with past practices;
(6)transaction or commitment made, or any contract or agreement entered into, by Acquired Company relating to its assets or business (including the acquisition or disposition of any assets) or any relinquishment by Acquired Company of any contract or other right, in either case, material to Acquired Company, other than transactions and commitments in the ordinary course consistent with past practices and those contemplated by this Agreement;
(7)labor dispute, other than routine, individual grievances, or, to the knowledge of Acquired Company, any activity or proceeding by a labor union or representative thereof to organize any employees of Acquired Company or any lockouts, strikes, slowdowns, work stoppages or threats by or with respect to such employees;
(8)payment, prepayment or discharge of liability other than in the ordinary course of business or any failure to pay any liability when due;
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(9)write-offs or write-downs of any assets of Acquired Company;
(10)creation, termination or amendment of, or waiver of any right under, any material contract of Acquired Company;
(11)damage, destruction or loss having, or reasonably expected to have, a material adverse effect on Acquired Company;
(12)other condition, event or occurrence which individually or in the aggregate could reasonably be expected to have a material adverse effect or give rise to a material adverse change with respect to Acquired Company; or
(13)agreement or commitment to do any of the foregoing.
(j)Certain Fees. No brokerage or finder’s fees or commissions are or will be payable by Acquired Company to any broker, financial advisor or consultant, finder, placement agent, investment banker, bank or other person with respect to the transactions contemplated by this Agreement.
(k)Litigation; Labor Matters; Compliance with Laws.
(1)Except as set forth in Schedule 3(k)(1), there is no suit, action or proceeding or investigation pending or, to the knowledge of Acquired Company, threatened against or affecting Acquired Company or any basis for any such suit, action, proceeding or investigation that, individually or in the aggregate, could reasonably be expected to have a material adverse effect with respect to Acquired Company or prevent, hinder or materially delay the ability of Acquired Company to consummate the transactions contemplated by this Agreement, nor is there any judgment, decree, injunction, rule or order of any governmental entity or arbitrator outstanding against Acquired Company having, or which, insofar as reasonably could be foreseen by Acquired Company, in the future could have, any such effect.
(2)Acquired Company is not a party to, or bound by, any collective bargaining agreement, contract or other agreement or understanding with a labor union or labor organization, nor is it the subject of any proceeding asserting that it has committed an unfair labor practice or seeking to compel it to bargain with any labor organization as to wages or conditions of employment nor is there any strike, work stoppage or other labor dispute involving it pending or, to its knowledge, threatened, any of which could have a material adverse effect with respect to Acquired Company.
(3)The conduct of the business of Acquired Company complies with all statutes, laws, regulations, ordinances, rules, judgments, orders, decrees or arbitration awards applicable thereto.
(l)Benefit Plans. Acquired Company is not a party to any Benefit Plan under which Acquired Company currently has an obligation to provide benefits to any current or former employee, officer or director of Acquired Company. As used herein, “Benefit Plan” shall mean any employee benefit plan, program, or arrangement of any kind, including any defined benefit or defined contribution plan, ownership plan with respect to any membership interest, executive compensation program or arrangement, bonus plan, incentive compensation plan or arrangement, profit sharing plan or arrangement, deferred compensation plan, agreement or arrangement, supplemental retirement plan or arrangement, vacation pay, sickness, disability, or death benefit plan (whether provided through insurance, on a funded or unfunded basis, or otherwise), medical or life insurance plan providing benefits to employees, retirees, or former employees or any of their dependents, survivors, or beneficiaries, severance pay, termination, salary continuation, or employee assistance plan.
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(m)Tax Returns and Tax Payments.
(1)Acquired Company has timely filed with the appropriate taxing authorities all Tax Returns, as that term is hereinafter defined, required to be filed by it (taking into account all applicable extensions). All such Tax Returns are true, correct and complete in all respects. All Taxes, as that term is hereinafter defined, due and owing by Acquired Company have been paid (whether or not shown on any Tax Return and whether or not any Tax Return was required). Acquired Company is not currently the beneficiary of any extension of time within which to file any Tax Return or pay any Tax. No claim has ever been made in writing or otherwise addressed to Acquired Company by a taxing authority in a jurisdiction where Acquired Company does not fileTax Returns that it is or may be subject to taxation by that jurisdiction. Since inception, Acquired Company has not incurred any liability for Taxes outside the ordinary course of business consistent with past custom and practice.
(2)No material claim for unpaid Taxes has been made or become a lien against the property of Acquired Company or is being asserted against Acquired Company, no audit of any Tax Return of Acquired Company is being conducted by a tax authority, and no extension of the statute of limitations on the assessment of any Taxes has been granted by Acquired Company and is currently in effect. Acquired Company has withheld and paid all Taxes required to have been withheld and paid in connection with amounts paid or owing to any employee, independent contractor, creditor, stockholder or other third party.
(3)As used herein, “Taxes” shall mean all taxes of any kind, including, without limitation, those on or measured by or referred to as income, gross receipts, sales, use, ad valorem, franchise, profits, license, withholding, payroll, employment, excise, severance, stamp, occupation, premium value added, property or windfall profits taxes, customs, duties or similar fees, assessments or charges of any kind whatsoever, together with any interest and any penalties, additions to tax or additional amounts imposed by any governmental authority, domestic or foreign. As used herein, “ Tax Return “ shall mean any return, report or statement required to be filed with any governmental authority with respect to Taxes.
(n)Environmental Matters. Acquired Company is in compliance with all Environmental Laws in all material respects. Acquired Company has not received any written notice regarding any violation of any Environmental Laws, as that term is hereinafter defined, including any investigatory, remedial or corrective obligations. Acquired Company holds all permits and authorizations required under applicable Environmental Laws, unless the failure to hold such permits and authorizations would not have a material adverse effect on Acquired Company, and is in compliance with all terms, conditions and provisions of all such permits and authorizations in all material respects. No releases of Hazardous Materials, as that term is hereinafter defined, have occurred at, from, in, to, on or under any real property currently or formerly owned, operated or leased by Acquired Company or any predecessor thereof and no Hazardous Materials are present in, on, about or migrating to or from any such property which could result in any liability to Acquired Company. Acquired Company has not transported or arranged for the treatment, storage, handling, disposal, or transportation of any Hazardous Material to any off-site location which could result in any liability to Acquired Company. Acquired Company has no liability, absolute or contingent, under any Environmental Law that if enforced or collected would have a material adverse effect on Acquired Company. There are no past, pending or threatened claims under Environmental Laws against Acquired Company and Acquired Company is not aware of any facts or circumstances that could reasonably be expected to result in a liability or claim against Acquired Company pursuant to Environmental Laws. “Environmental Laws” means all applicable foreign, federal, state and local statutes, rules, regulations, ordinances, orders, decrees and common law relating in any manner to contamination, pollution or protection of human health or the environment, and similar state laws. “Hazardous Material” means any toxic, radioactive, corrosive or otherwise hazardous substance, including petroleum, its derivatives, by-products and other hydrocarbons, or any substance having any constituent elements displaying
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any of the foregoing characteristics, which in any event is regulated under any Environmental Law.
(o)Material Contracts. All Material Contracts copies of which have been furnished to RDAR. Acquired Company is not, or has not received any notice or has any knowledge that any other party is, in default in any respect under any Material Contract, as that term is hereinafter defined; and there has not occurred any event that with the lapse of time or the giving of notice or both would constitute such a material default.
For purposes of this Agreement, a “Material Contract” means any contract, agreement or commitment that is effective as of the Closing Date to which Acquired Company is a party (1) with expected receipts or expenditures in an amount in excess of two percent (2%) of Acquired Company’s gross revenues for the 12 months ended July 31, 2025, (2) requiring Acquired Company to indemnify any person in an amount that is expected to exceed ten percent (10%) of Acquired Company’s owners’ equity as of the date of Closing, (3) granting exclusive rights to any party, (4) evidencing indebtedness for borrowed or loaned money in an amount in excess of ten percent (10%) of Acquired Company’s owners’ equity, including guarantees of such indebtedness, as of the date of Closing, or (5) which, if breached by Acquired Company in such a manner would (A) permit any other party to cancel or terminate the same (with or without notice of passage of time) or (B) provide a basis for any other party to claim money damages (either individually or in the aggregate with all other such claims under that contract) from Acquired Company or (C) give rise to a right of acceleration of any material obligation or loss of any material benefit under any such contract, agreement or commitment.
(p)Properties. Acquired Company has no real property. Any facilities held under lease by Acquired Company is held by it under valid, subsisting and enforceable leases of which Acquired Company is in compliance, except as could not, individually or in the aggregate, have or reasonably be expected to result in a material adverse effect.
(q)Intellectual Property.
(1)As used in this Agreement, the term “Trademarks” means trademarks, service marks, trade names, internet domain names, designs, slogans, and general intangibles of like nature; the term “Trade Secrets” means technology; trade secrets and other confidential information, know-how, proprietary processes, formulae, algorithms, models, and methodologies; the term “ Intellectual Property “ means patents, copyrights, Trademarks, applications for any of the foregoing, and Trade Secrets; the term “ Company License Agreements “ means any license agreements granting any right to use or practice any rights under any Intellectual Property (except for such agreements for off-the-shelf products that are generally available for less than $10,000), and any written settlements relating to any Intellectual Property, to which Acquired Company is a party or otherwise bound; and the term “ Software “ means any and all computer programs, including any and all software implementations of algorithms, models and methodologies, whether in source code or object code.
(2)Acquired Company owns or has valid rights to use the Trademarks, trade names, domain names, copyrights, patents, logos, licenses and computer software programs (including, without limitation, the source codes thereto) that are necessary for the conduct of its respective businesses as now being conducted. To the knowledge of Acquired Company, none of Acquired Company’s Intellectual Property or License Agreements infringe upon the rights of any third party that may give rise to a cause of action or claim against Acquired Company or its successors.
(r)Affiliate Transactions. Except as set forth in Schedule 3(r), no officer, director or employee of Acquired Company or any member of the immediate family of any such officer, director or employee, or any entity in which any of such persons owns any beneficial interest (other than any publicly-held
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corporation whose stock is traded on a national securities exchange or in the over-the-counter market and less than one percent of the stock of which is beneficially owned by any of such persons), has any agreement with Acquired Company or any interest in any of their property of any nature, used in or pertaining to the business of Acquired Company. None of the foregoing persons has any direct or indirect interest in any competitor, supplier or customer of Acquired Company or in any person from whom or to whom Acquired Company leases any property or transacts business of any nature.
(s)Undisclosed Liabilities. Except as set forth in Schedule 3(s), Acquired Company has no liabilities or obligations of any nature (whether fixed or unfixed, secured or unsecured, known or unknown and whether absolute, accrued, contingent, or otherwise.)
(t)Full Disclosure. All of the representations and warranties made by Acquired Company in this Agreement, and all statements set forth in the certificates delivered by Acquired Company at the Closing pursuant to this Agreement, are true, correct and complete in all material respects and do not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make such representations, warranties or statements, in light of the circumstances under which they were made, misleading. The copies of all documents furnished by Acquired Company pursuant to the terms of this Agreement are complete and accurate copies of the original documents. The schedules, certificates, and any and all other statements and information, whether furnished in written or electronic form, to RDAR or its representatives by or on behalf of any of Acquired Company or its affiliates in connection with the negotiation of this Agreement and the transactions contemplated hereby do not contain any material misstatement of fact or omit to state a material fact or any fact necessary to make the statements contained therein not misleading.
3.2Representations and Warranties of RDAR. As a material inducement for Acquired Company and the Owner to enter into this Agreement and to consummate the transactions contemplated hereby, RDAR hereby makes the following representations and warranties as of the date hereof and as of the Closing Date, each of which is relied upon by Acquired Company regardless of any investigation made or information obtained by Acquired Company (unless and to the extent specifically and expressly waived in writing by Acquired Company on or before the Closing Date):
(a)Organization, Standing and Corporate Power. RDAR is a corporation duly organized, validly existing and in good standing under the laws of the State of Nevada and has the requisite corporate power and authority and all government licenses, authorizations, permits, consents and approvals required to own, lease and operate its properties and carry on its business as now being conducted. RDAR is duly qualified or licensed to do business and is in good standing in each jurisdiction in which the nature of its business or the ownership or leasing of its properties makes such qualification or licensing necessary, other than in such jurisdictions where the failure to be so qualified or licensed (individually or in the aggregate) would not have a material adverse effect with respect to RDAR.
(b)Subsidiaries. RDAR has no subsidiaries.
(c)Capitalization of RDAR. The entire authorized capital stock of RDAR consists of 15,000,000,000 common shares, par value $0.001 per share, of which 4,433,149,661 shares are issued and outstanding, and 100,000,000 shares of preferred stock, par value $0.001 per share, (1) 1,000,000 shares of which are designated Series E Preferred Stock and 1,000,000 shares of which are issued and outstanding and (2) 75,000 shares of which are designated Series F Preferred Stock and no shares of which are issued and outstanding. All of RDAR’s issued and outstanding shares have been duly authorized, are validly issued, fully paid and non-assessable.
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Except as set forth in Schedule 3.2(c), there are no other shares of RDAR capital stock issuable upon the exercise of outstanding warrants, convertible notes, options or otherwise. Except as set forth in Schedule 3.2(c), no shares of capital stock or other equity securities of RDAR are issued, reserved for issuance or outstanding.
The Exchange Shares will be, when issued, duly authorized, validly issued, fully paid and non-assessable, not subject to preemptive rights and issued in compliance with all applicable state and federal laws concerning the issuance of securities.
(d)Corporate Authority; Non-contravention. RDAR has all requisite corporate and other power and authority to enter into this Agreement and to consummate the transactions contemplated by this Agreement. The execution and delivery of this Agreement by RDAR and the consummation by RDAR of the transactions contemplated hereby have been (or at Closing will have been) duly authorized by all necessary corporate action on the part of RDAR. This Agreement has been duly executed and when delivered by RDAR shall constitute a valid and binding obligation of RDAR, enforceable against RDAR in accordance with its terms, except as such enforcement may be limited by bankruptcy, insolvency or other similar laws affecting the enforcement of creditors’ rights generally or by general principles of equity. The execution and delivery of this Agreement does not, and the consummation of the transactions contemplated by this Agreement and compliance with the provisions hereof will not, conflict with, or result in any breach or violation of, or default (with or without notice or lapse of time, or both) under, or give rise to a right of termination, cancellation or acceleration of or “put” right with respect to any obligation or to loss of a material benefit under, or result in the creation of any lien upon any of the properties or assets of RDAR under (1) its articles of incorporation, bylaws, or other charter documents; (2) any loan or credit agreement, note, bond, mortgage, indenture, lease or other agreement, instrument, permit, concession, franchise or license applicable to RDAR,its properties or assets; or (3) subject to the governmental filings and other matters referred to in the following sentence, any judgment, order, decree, statute, law, ordinance, rule, regulation or arbitration award applicable to RDAR, its properties or assets, other than, in the case of clauses (2) and (3), any such conflicts, breaches, violations, defaults, rights, losses or liens that individually or in the aggregate could not have a material adverse effect with respect to RDAR or could not prevent, hinder or materially delay the ability of RDAR to consummate the transactions contemplated by this Agreement.
(e)Government Authorization. No consent, approval, order or authorization of, or registration, declaration or filing with, or notice to, any Governmental Entity, is required by or with respect to RDAR in connection with the execution and delivery of this Agreement by RDAR, or the consummation by RDAR of the transactions contemplated hereby, except, with respect to this Agreement, any filings under the Nevada Statutes, the Securities Act or the Exchange Act.
(f)Financial Statements.
(1)The unaudited financial statements of RDAR included in the reports, schedules, forms, statements and other documents filed by RDAR with OTC Markets (collectively, and in each case including all exhibits and schedules thereto and documents incorporated by reference therein, the “RDAR Financial Information”) comply as to form in all material respects with applicable accounting requirements and the published rules of OTC Markets with respect thereto, have been prepared in accordance with U.S. generally accepted accounting principles applied on a consistent basis during the periods involved (except as may be indicated in the notes thereto) and fairly present the consolidated financial position of RDAR and its consolidated subsidiaries as of the dates thereof and the consolidated results of operations and changes in cash flows for the periods then ended. Except as set forth in the RDAR Financial Information, at the date of the most recent unaudited financial statements of RDAR included in the RDAR Financial Information, RDAR has not
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incurred any liabilities or obligations of any nature (whether accrued, absolute, contingent or otherwise) which, individually or in the aggregate, could reasonably be expected to have a material adverse effect with respect to RDAR.
(2)RDAR has made the following financial information (the RDAR Financial Information) available to Acquired Company:
(A)unaudited balance sheet and statements of income, changes in stockholders’ equity and cash flow as of and for the years ended December 31, 2023 and 2022;
(B)unaudited balance sheet and statements of income, changes in stockholders’ equity and cash flow as of and for the six months ended June 30, 2024 (the “RDAR Interim Statements”); and
(C)The RDAR Financial Information presents fairly the financial condition of RDAR as of such dates and the results of operations of RDAR for such periods, in accordance with GAAP and are consistent with the books and records of RDAR (which books and records are correct and complete).
(g)Events Subsequent to RDAR Interim Statements. Since the date of the RDAR Interim Statements, there has not been, occurred or arisen, with respect to RDAR:
(1)any change or amendment in its Articles of Incorporation and/or Bylaws;
(2)any reclassification, split-up or other change in, or amendment of or modification to, the rights of the holders of any of its capital stock, except changes made in relation to the transactions contemplated by this Agreement;
(3)any direct or indirect redemption, purchase or acquisition by any person of any of its capital stock or of any interest in or right to acquire any such stock;
(4)any issuance, sale, or other disposition of any capital stock, or any grant of any options, warrants, or other rights to purchase or obtain (including upon conversion, exchange, or exercise) any capital stock;
(5)any declaration, set aside, or payment of any dividend or any distribution with respect to its capital stock (whether in cash or in kind) or any redemption, purchase, or other acquisition of any of its capital stock;
(6)the organization of any subsidiary or the acquisition of any shares of capital stock by any person or any equity or ownership interest in any business;
(7)any damage, destruction or loss of any of its properties or assets whether or not covered by insurance;
(8)any sale, lease, transfer or assignment of any of its assets, tangible or intangible, other than for a fair consideration in the ordinary course of business;
(9)the execution of, or any other commitment to any agreement, contract, lease, or license (or series of related agreements, contracts, leases, and licenses) outside the ordinary course of business;
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(10)any acceleration, termination, modification, or cancellation of any agreement, contract lease or license (or series of related agreements, contracts, leases, and licenses) involving more than $10,000 to which it is a party or by which it is bound;
(11)any security interest or encumbrance imposed upon any of its assets, tangible;
(12)any capital investment in, any loan to, or any acquisition of the securities or assets of, any other person or entity (or series of related capital investments, loans and acquisitions) involving more than $2,500 and outside the ordinary course of business;
(13)any issuance of any note, bond or other debt security, or created, incurred, assumed, or guaranteed any indebtedness for borrowed money or capitalized lease obligation involving more than $2,500;
(14)any delay or postponement of the payment of accounts payable or other liabilities;
(15)any loan to, or any entrance into any other transaction with, any of its directors, officers and employees either involving more than $500 individually or $2,500 in the aggregate;
(16)any employment contract or collective bargaining agreement, written or oral, or modified the terms of any existing such contract or agreement;
(17)any taking of other action or entrance into any other transaction other than in the ordinary course of business, or entrance into any transaction with any insider of RDAR, except as disclosed in this Agreement and any disclosures schedules;
(18)any other event or occurrence that may have or could reasonably be expected to have a material adverse effect on RDAR (whether or not similar to any of the foregoing); or
(19)any agreement, whether in writing or otherwise, to do any of the foregoing.
(h)Certain Fees. No brokerage or finder’s fees or commissions are or will be payable by RDAR to any broker, financial advisor or consultant, finder, placement agent, investment banker, bank or other person with respect to the transactions contemplated by this Agreement.
(i)Litigation; Labor Matters; Compliance with Laws.
(1)There is no suit, action or proceeding or investigation pending or, to the knowledge of RDAR, threatened against or affecting RDAR or any basis for any such suit, action, proceeding or investigation that, individually or in the aggregate, could reasonably be expected to have a material adverse effect with respect to RDAR or prevent, hinder or materially delay the ability of RDAR to consummate the transactions contemplated by this Agreement, nor is there any judgment, decree, injunction, rule or order of any Governmental Entity or arbitrator outstanding against RDAR having, or which, insofar as reasonably could be foreseen by RDAR, in the future could have, any such effect.
(2)The conduct of the business of RDAR complies with all statutes, laws, regulations, ordinances, rules, judgments, orders, decrees or arbitration awards applicable thereto.
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(j)Contracts. Except as set forth in Schedule 3.2(j), RDAR has no written or oral contracts, understandings, agreements and other arrangements executed by an officer or duly authorized employee of RDAR or to which RDAR is a party, except for this Agreement.
(k)OTC Markets Reports and Financial Statements. RDAR has filed with OTC Markets all reports and other filings required to be filed by RDAR in accordance with the rules of OTC Markets (the “RDAR OTC Markets Reports”). As of their respective dates, the RDAR OTC Markets Reports complied in all material respects with the applicable requirements of the Securities Act, the Exchange Act and the respective rules and regulations promulgated thereunder applicable to such RDAR OTC Markets Reports and, except to the extent that information contained in any RDAR OTC Markets Report has been revised or superseded by a later RDAR OTC Markets Report filed and publicly available prior to the date of this Agreement, none of the RDAR OTC Markets Reports contained any untrue statement of a material fact or omitted to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. The financial statements of RDAR included in RDAR OTC Markets Reports were prepared from and are in accordance with the accounting books and other financial records of RDAR, were prepared in accordance with GAAP applied on a consistent basis during the periods involved (except as may be indicated in the notes thereto) and presented fairly the consolidated financial position of RDAR as of the dates thereof and the consolidated results of operations and cash flows for the periods then ended. Except as set forth in the RDAR OTC Markets Reports, RDAR has no liabilities or obligations of any nature (whether accrued, absolute, contingent or otherwise) other than liabilities or obligations incurred in the ordinary course of business. The RDAR OTC Markets Reports accurately disclose (1) the terms and provisions of all stock option plans, (2) transactions with Affiliates and (3) all material contracts. If, at any time prior to Closing, should RDAR become delinquent in any required filings with OTC Markets, RDAR represents and warrants that such filings shall be brought current in no less than 10 business days from the due date. Until such time as the filing is brought current, RDAR will promptly file any and all reports required to advise the OTC Markets of the failure to file the reports when due.
(l)Board Determination. The Board of Directors of RDAR has unanimously determined that the terms of the Share Exchange are fair to and in the best interests of RDAR and its shareholders.
(m)Required RDAR Share Issuance Approval. RDAR represents that the issuance of the Exchange Shares to the Owner will be in compliance with the Nevada Statutes and the Bylaws of RDAR, as well as federal and state securities laws.
(n)Undisclosed Liabilities. Except as set forth in Schedule 3.2(n), RDAR has no liabilities or obligations of any nature (whether fixed or unfixed, secured or unsecured, known or unknown and whether absolute, accrued, contingent, or otherwise) except for liabilities or obligations reflected or reserved against in the RDAR OTC Markets Documents incurred in the ordinary course of business.
(o)Full Disclosure. All of the representations and warranties made by RDAR in this Agreement, and all statements set forth in the certificates delivered by RDAR at the Closing pursuant to this Agreement, are true, correct and complete in all material respects and do not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make such representations, warranties or statements, in light of the circumstances under which they were made, misleading. The copies of all documents furnished by RDAR pursuant to the terms of this Agreement are complete and accurate copies of the original documents. The schedules, certificates, and any and all other statements and information, whether furnished in written or electronic form, to Acquired Company or its representatives by or on behalf of RDAR in connection with the negotiation of this Agreement and the transactions contemplated hereby do not contain any material misstatement of fact or omit to state a material fact or any fact necessary to make the statements contained
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therein not misleading.
(p)Powers of Attorney. There are no outstanding powers of attorney executed on behalf of RDAR.
Article IV.
Covenants Relating to Conduct of Business Prior to Share Exchange
4.1Conduct of Acquired Company and RDAR. From the date of this Agreement and until the Effective Time, or until the prior termination of this Agreement, Acquired Company and RDAR shall not, unless mutually agreed to in writing:
(a)engage in any transaction, except in the normal and ordinary course of business, or create or suffer to exist any lien or other encumbrance upon any of their respective assets or which will not be discharged in full prior to the Effective Time;
(b)sell, assign or otherwise transfer any of their assets, or cancel or compromise any debts or claims relating to their assets, other than for fair value, in the ordinary course of business, and consistent with past practice;
(c)fail to use reasonable efforts to preserve intact their present business organizations, keep available the services of their employees and preserve its material relationships with customers, suppliers, licensors, licensees, distributors and others, to the end that its good will and ongoing business not be impaired prior to the Effective Time;
(d)suffer or permit any material adverse change to occur with respect to Acquired Company and RDAR or their business or assets; and
(e)make any material change with respect to their business in accounting or bookkeeping methods, principles or practices, except as required by GAAP.
4.2Current Information.
(a)During the period from the date of this Agreement to the Closing, each party hereto shall promptly notify each other party of any (1) significant change in its ordinary course of business, (2) proceeding (or communications indicating that the same may be contemplated), or the institution or threat or settlement of proceedings, in each case involving the Parties the outcome of which, if adversely determined, could reasonably be expected to have a material adverse effect on the Party, taken as a whole or (3) event which such Party reasonably believes could be expected to have a material adverse effect on the ability of any party hereto to consummate the Share Exchange.
(b)During the period from the date of this Agreement to the Closing, RDAR shall promptly notify Acquired Company of any correspondence received from OTC Markets or the SEC and shall deliver a copy of such correspondence to Acquired Company within one (1) business day of receipt.
4.3Material Transactions. Prior to the Closing, neither Acquired Company nor RDAR will, without first obtaining the written consent of the other parties hereto:
(a)amend its Articles of Incorporation or Bylaws or enter into any agreement to merge or
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consolidate with, or sell a significant portion of its assets to, any other Person;
(b)place on any of its assets or properties any pledge, charge or other encumbrance, except as otherwise authorized hereunder, or enter into any transaction or make any contract or commitment relating to its properties, assets and business, other than in the ordinary course of business or as otherwise disclosed herein;
(c)guarantee the obligation of any person, firm or corporation, except in the ordinary course of business;
(d)make any loan or advance in excess of $2,500 in the aggregate or cancel or accelerate any material indebtedness owing to it or any claims which it may possess or waive any material rights of substantial value;
(e)violate any applicable law which violation might have a material adverse effect on such party;
(f)except in the ordinary course of business, enter into any agreement or transaction with any of such party’s affiliates; or
(g)engage in any transaction or take any action that would render untrue in any material respect any of the representations and warranties of such party contained in this Agreement, as if such representations and warranties were given as of the date of such transaction or action.
Article V.
Additional Agreements
5.1Reorganization Agreement: Mexedia Inc. At or prior to the Closing, RDAR, Mexedia Inc. (“US Mexedia”) and the owner of US Mexedia shall have entered into a Share Exchange Agreement, in the form of Exhibit B attached hereto (the “US Mexedia SPA”), pursuant to which RDAR would acquire all of the outstanding shares of capital stock of US Mexedia.
5.2Redemption Agreement. At or prior to the Closing, RDAR and JanBella Group, LLC shall have entered into a Redemption Agreement, in the form of Exhibit C attached hereto (the “Redemption Agreement”), pursuant to which RDAR would re-acquire all outstanding shares of Series E Preferred Stock of RDAR.
5.3Access to Information; Confidentiality.
(a)Acquired Company shall, and shall cause its officers, employees, counsel, financial advisors and other representatives to, afford to RDAR and its representatives reasonable access during normal business hours during the period prior to the Effective Time to its and to Acquired Company’s properties, books, contracts, commitments, personnel and records and, during such period, Acquired Company shall, and shall cause its officers, employees and representatives to, furnish promptly to RDAR all information concerning its business, properties, financial condition, operations and personnel as such other party may from time to time reasonably request. For the purposes of determining the accuracy of the representations and warranties of RDAR set forth herein and compliance by RDAR of its obligations hereunder, during the period prior to the Effective Time, RDAR shall provide Acquired Company and its representatives with reasonable access during normal business hours to its properties, books, contracts, commitments, personnel and records as may be necessary to enable Acquired Company to confirm the accuracy of the representations and warranties of RDAR
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set forth herein and compliance by RDAR of its obligations hereunder, and, during such period, RDAR shall, and shall cause its officers, employees and representatives to, furnish promptly to Acquired Company upon its request (1) a copy of each report, schedule, registration statement and other document filed by it during such period pursuant to the requirements of federal or state securities laws and (2) all other information concerning its business, properties, financial condition, operations and personnel as such other party may from time to time reasonably request.
Except as required by law, each of Acquired Company and RDAR will hold, and will cause its respective directors, officers, employees, accountants, counsel, financial advisors and other representatives and affiliates to hold, any nonpublic information in confidence.
(b)No investigation pursuant to this Section 5.3 shall affect any representations or warranties of the parties herein or the conditions to the obligations of the parties hereto.
5.4Best Efforts. Upon the terms and subject to the conditions set forth in this Agreement, each of the parties agrees to use its best efforts to take, or cause to be taken, all actions, and to do, or cause to be done, and to assist and cooperate with the other parties in doing, all things necessary, proper or advisable to consummate and make effective, in the most expeditious manner practicable, the Share Exchange and the other transactions contemplated by this Agreement. RDAR and Acquired Company shall mutually cooperate in order to facilitate the achievement of the benefits reasonably anticipated from the Share Exchange.
5.5Public Announcements. RDAR, on the one hand, and Acquired Company, on the other hand, will consult with each other before issuing, and provide each other the opportunity to review and comment upon, any press release or other public statements with respect to the transactions contemplated by this Agreement and shall not issue any such press release or make any such public statement prior to such consultation, except as may be required by applicable law or court process. The parties agree that the initial press release or releases to be issued with respect to the transactions contemplated by this Agreement shall be mutually agreed upon prior to the issuance thereof.
5.6Expenses. All costs and expenses incurred in connection with this Agreement and the transactions contemplated hereby shall be paid by the party incurring such expenses.
5.7No Solicitation. Except as previously agreed to in writing by the other party, neither Acquired Company nor RDAR shall authorize or permit any of its officers, directors, agents, representatives, or advisors to solicit, initiate or encourage or take any action to facilitate the submission of inquiries, proposals or offers from any person relating to any matter concerning any exchange, merger, consolidation, business combination, recapitalization or similar transaction involving Acquired Company or RDAR, respectively, other than the transaction contemplated by this Agreement or any other transaction the consummation of which would or could reasonably be expected to impede, interfere with, prevent or delay the Share Exchange or which would or could be expected to dilute the benefits to either Acquired Company or RDAR of the transactions contemplated hereby. Acquired Company or RDAR will immediately cease and cause to be terminated any existing activities, discussions and negotiations with any parties conducted heretofore with respect to any of the foregoing.
Article VI.
Conditions Precedent and Conditions Subsequent
6.1Conditions to Each Party’s Obligation to Effect the Share Exchange. The obligation of each party to effect the Share Exchange and otherwise consummate the transactions contemplated by this Agreement is subject to the satisfaction, at or prior to the Closing, of each of the following conditions:
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(a)No Restraints. No temporary restraining order, preliminary or permanent injunction or other order preventing the consummation of the Share Exchange shall have been issued by any court of competent jurisdiction or any other Governmental Entity having jurisdiction and shall remain in effect, and there shall not be any applicable legal requirement enacted, adopted or deemed applicable to the Share Exchange that makes consummation of the Share Exchange illegal.
(b)Governmental Approvals.
(1)As to RDAR and Acquired Company. All authorizations, consents, orders, declarations or approvals of, or filings with, or terminations or expirations of waiting periods imposed by, any governmental entity having jurisdiction which the failure to obtain, make or occur would have a material adverse effect on RDAR or Acquired Company shall have been obtained, made or occurred.
(2)As to the Owner. All required approvals required by local rules and regulations, stock market rules and regulations and corporate governance requirements, including the issuance of any and all required communications with respect thereto, as well as all other authorizations, consents, orders, declarations or approvals of, or filings with, or terminations or expirations of waiting periods imposed by, any governmental entity having jurisdiction which the failure to obtain, make or occur would have a material adverse effect on the Owner shall have been obtained, made or occurred.
(c)No Litigation. There shall not be pending or threatened any suit, action or proceeding before any court, Governmental Entity or authority (1) pertaining to the transactions contemplated by this Agreement or (2) seeking to prohibit or limit the ownership or operation by Acquired Company or RDAR, or to dispose of or hold separate any material portion of the business or assets of Acquired Company or RDAR.
6.2Conditions Precedent to Obligations of RDAR. The obligation of RDAR to effect the Share Exchange and otherwise consummate the transactions contemplated by this Agreement are subject to the satisfaction, at or prior to the Closing, of each of the following conditions:
(a)Representations, Warranties and Covenants. The representations and warranties of Acquired Company in this Agreement shall be true and correct in all material respects (except for such representations and warranties that are qualified by their terms by a reference to materiality or material adverse effect, which representations and warranties as so qualified shall be true and correct in all respects) both when made and on and as of the Closing Date, and Acquired Company shall have performed and complied in all material respects with all covenants, obligations and conditions of this Agreement required to be performed and complied with by each of them prior to the Effective Time.
(b)Consents. RDAR shall have received evidence, in form and substance reasonably satisfactory to it, that such licenses, permits, consents, approvals, authorizations, qualifications and orders of governmental authorities and other third parties as necessary in connection with the transactions contemplated hereby have been obtained.
(c)No Material Adverse Change. There shall not have occurred any change in the business, condition (financial or otherwise), results of operations or assets (including intangible assets) and properties of Acquired Company that, individually or in the aggregate, could reasonably be expected to have a material adverse effect on Acquired Company.
(d)Board Resolutions. RDAR shall have received resolutions duly adopted by Acquired
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Company’s board of directors and the Owner’s board of directors approving the execution, delivery and performance of the Agreement and the transactions contemplated by the Agreement.
(e)Other Approvals. RDAR shall have received from the Owner written confirmation of its having obtained any and all approvals relating to this Agreement as may be required by the securities laws of the French Republic, including the rules and regulations promulgated thereunder.
(f)Due Diligence Investigation. RDAR shall be reasonably satisfied with the results of its due diligence investigation of Acquired Company in its sole and absolute discretion.
6.3Conditions Precedent to Obligation of Acquired Company. The obligation of Acquired Company to effect the Share Exchange and otherwise consummate the transactions contemplated by this Agreement is subject to the satisfaction, at or prior to the Closing, of each of the following conditions:
(a)Representations, Warranties and Covenants. The representations and warranties of RDAR in this Agreement shall be true and correct in all material respects (except for such representations and warranties that are qualified by their terms by a reference to materiality or material adverse effect, which representations and warranties as so qualified shall be true and correct in all respects) both when made and on and as of the Closing Date, and RDAR shall have performed and complied in all material respects with all covenants, obligations and conditions of this Agreement required to be performed and complied with by it prior to the Effective Time.
(b)Consents. Acquired Company shall have received evidence, in form and substance reasonably satisfactory to it, that such licenses, permits, consents, approvals, authorizations, qualifications and orders of governmental authorities and other third parties as necessary in connection with the transactions contemplated hereby have been obtained.
(c)No Material Adverse Change. There shall not have occurred any change in the business, condition (financial or otherwise), results of operations or assets (including intangible assets) and properties of RDAR that, individually or in the aggregate, could reasonably be expected to have a material adverse effect on RDAR.
(d)Board Resolutions. Acquired Company shall have received resolutions duly adopted by RDAR’s board of directors and the Owner’s board of directors approving the execution, delivery and performance of the Agreement and the transactions contemplated by the Agreement.
(e)Other Approvals. Acquired Company shall have received from the Owner written confirmation of its having obtained any and all approvals relating to this Agreement as may be required by the securities laws of the French Republic, including the rules and regulations promulgated thereunder.
(f)Due Diligence Investigation. Acquired Company shall be reasonably satisfied with the results of its due diligence investigation of RDAR in its sole and absolute discretion.
6.4Conditions Subsequent.
(a)Regulation A Offering. Should RDAR fail to have filed an Offering Statement on Form 1-A pursuant to Regulation A of the Securities and Exchange Commission (the “Reg A Offering”), on or before the 20th day following the Closing, the Owner shall have the right, but not the obligation, to rescind this Agreement by written notice to RDAR.
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(b)Regulation A Offering Proceeds. Should RDAR fail to have obtained the sum of $1,500,000 in proceeds from the Reg A Offering, on or before the date that is six (6) months from the date of the SEC’s qualification of the Reg A Offering, the Members shall have the right, but not the obligation, to rescind this Agreement by unanimous written notice to RDAR (the “Rescission Notice”). Upon RDAR’s receipt of the Rescission Notice, this Agreement shall, ipso facto, be rescinded and the Parties returned to their statuses quo ante.
(c)Divestiture. Should RDAR fail to have divested of its current operations, which divestiture shall include all debts, other than the trade payables of RDAR listed on Exhibit D attached hereto and incorporated herein, of RDAR as of the Closing Date, on or before December 31, 2024, the Owner shall have the right, but not the obligation, to rescind this Agreement by written notice to RDAR.
Article VII.
Closing
7.1RDAR shall make the following deliveries at the Closing. To consummate the transaction, RDAR shall, at the Closing, make the following deliveries:
(a)Executed Closing Certificate, in the form of Exhibit E attached hereto;
(b)Executed written consent of the Board of Directors or RDAR authorizing each of the Change-in-Control Agreement, including this Agreement, and the issuance of the Exchange Shares;
(c)A fully executed US Mexedia SPA;
(d)A fully executed Redemption Agreement; and
(e)The Exchange Shares, in the form of the Exchange Shares Certificate.
7.2Acquired Company and the Owner shall make the following deliveries at the Closing. To consummate the transaction Acquired Company and the Owner shall, at Closing, make the following deliveries:
(a)Executed Closing Certificate, in the form of Exhibit F attached hereto;
(b)A fully executed US Mexedia SPA; and
(c)The Ownership Interest, duly assigned to RDAR.
Article VIII.
Termination, Amendment and Waiver
8.1Termination. This Agreement may be terminated and abandoned at any time prior to the Effective Time of the Share Exchange:
(a)by mutual written consent of RDAR and Acquired Company;
(b)by either RDAR or Acquired Company if any Governmental Entity shall have issued an order, decree or ruling or taken any other action permanently enjoining, restraining or otherwise prohibiting the
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Share Exchange and such order, decree, ruling or other action shall have become final and non-appealable;
(c)by either RDAR or Acquired Company if the Share Exchange shall not have been consummated on or before January 31, 2025 (other than as a result of the failure of the party seeking to terminate this Agreement to perform its obligations under this Agreement required to be performed at or prior to the Effective Time).
(d)by RDAR, if a material adverse change shall have occurred relative to Acquired Company (and not curable within 10 days);
(e)by Acquired Company if a material adverse change shall have occurred relative to RDAR (and not curable within thirty 10 days);
(f)by RDAR, if Acquired Company willfully fails to perform in any material respect any of its material obligations under this Agreement; or
(g)by Acquired Company, if RDAR willfully fails to perform in any material respect any of its obligations under this Agreement.
8.2Effect of Termination. In the event of termination of this Agreement by either Acquired Company or RDAR as provided in Section 8.1, this Agreement shall forthwith become void and have no effect, without any liability or obligation on the part of RDAR or Acquired Company, other than the provisions of this Section 8.2. Nothing contained in this Section 8.2 shall relieve any party for any breach of the representations, warranties, covenants or agreements set forth in this Agreement.
8.3Amendment. This Agreement may not be amended except by an instrument in writing signed on behalf of each of the parties upon approval by the party, if such party is an individual, and upon approval of the Board of Director of RDAR and of Acquired Company.
8.4Extension; Waiver. Subject to Section 8.1(c), at any time prior to the Effective Time, the parties may (a) extend the time for the performance of any of the obligations or other acts of the other parties, (b) waive any inaccuracies in the representations and warranties contained in this Agreement or in any document delivered pursuant to this Agreement, or (c) waive compliance with any of the agreements or conditions contained in this Agreement. Any agreement on the part of a party to any such extension or waiver shall be valid only if set forth in an instrument in writing signed on behalf of such party. The failure of any party to this Agreement to assert any of its rights under this Agreement or otherwise shall not constitute a waiver of such rights.
8.5Return of Documents. In the event of termination of this Agreement for any reason, RDAR and Acquired Company will return to the other party all of the other party’s documents, work papers, and other materials (including copies) relating to the transactions contemplated in this Agreement, whether obtained before or after execution of this Agreement. RDAR and Acquired Company will not use any information so obtained from the other party for any purpose and will take all reasonable steps to have such other party’s information kept confidential.
Article IX.
Indemnification and Related Matters
9.1Survival of Representations and Warranties. The representations and warranties in this
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Agreement or in any instrument delivered pursuant to this Agreement, including any disclosure schedule, shall survive until twelve (12) months after the Effective Time (except for with respect to Taxes, which shall survive for the applicable statute of limitations plus 90 days, and covenants that by their terms survive for a longer period). The right to any remedy based upon such representations and warranties shall not be affected by any investigation conducted with respect to, or any knowledge acquired at any time, whether before or after execution and delivery of this Agreement or the Closing Date, with respect to the accuracy or inaccuracy of any such representation or warranty.
9.2Indemnification.
(a)RDAR shall indemnify and hold Acquired Company and Acquired Company’s officers and directors (“Acquired Company Representatives”) harmless for, from and against any and all liabilities, obligations, damages, losses, deficiencies, costs, penalties, interest and expenses (including, but not limited to, any and all expenses whatsoever reasonably incurred in investigating, preparing or defending against any litigation, commenced or threatened, or any claim whatsoever) (collectively, “Losses”) to which RDAR may become subject resulting from or arising out of any breach of a representation, warranty or covenant made by RDAR as set forth herein.
(b)Acquired Company shall indemnify and hold RDAR and RDAR’s officers and directors (“RDAR’s Representatives”) harmless for, from and against any and all Losses to which RDAR or RDAR’s Representatives may become subject resulting from or arising out of (1) any breach of a representation, warranty or covenant made by Acquired Company as set forth herein; or (2) any and all liabilities arising out of or in connection with: (A) any of the assets of Acquired Company prior to the Closing; or (B) the operations of Acquired Company prior to the Closing.
9.3Notice of Indemnification. Promptly after the receipt by any indemnified party (the “Indemnitee”) of notice of the commencement of any action or proceeding against such Indemnitee, such Indemnitee shall, if a claim with respect thereto is or may be made against any indemnifying party (the “Indemnifying Party”) pursuant to this Article IX, give such Indemnifying Party written notice of the commencement of such action or proceeding and give such Indemnifying Party a copy of such claim and/or process and all legal pleadings in connection therewith. The failure to give such notice shall not relieve any Indemnifying Party of any of its indemnification obligations contained in this Article IX, except where, and solely to the extent that, such failure actually and materially prejudices the rights of such Indemnifying Party. Such Indemnifying Party shall have, upon request within thirty (30) days after receipt of such notice, but not in any event after the settlement or compromise of such claim, the right to defend, at its own expense and by its own counsel reasonably acceptable to the Indemnitee, any such matter involving the asserted liability of the Indemnitee; provided, however, that if the Indemnitee determines that there is a reasonable probability that a claim may materially and adversely affect it, other than solely as a result of money payments required to be reimbursed in full by such Indemnifying Party under this Article IX or if a conflict of interest exists between Indemnitee and the Indemnifying Party, the Indemnitee shall have the right to defend, compromise or settle such claim or suit; and, provided, further, that such settlement or compromise shall not, unless consented to in writing by such Indemnifying Party, which shall not be unreasonably withheld, be conclusive as to the liability of such Indemnifying Party to the Indemnitee. In any event, the Indemnitee, such Indemnifying Party and its counsel shall cooperate in the defense against, or compromise of, any such asserted liability, and in cases where the Indemnifying Party shall have assumed the defense, the Indemnitee shall have the right to participate in the defense of such asserted liability at the Indemnitee’s own expense. In the event that such Indemnifying Party shall decline to participate in or assume the defense of such action, prior to paying or settling any claim against which such Indemnifying Party is, or may be, obligated under this Article IX to indemnify an Indemnitee, the Indemnitee shall first supply such Indemnifying Party with a copy of a final court judgment or decree holding
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the Indemnitee liable on such claim or, failing such judgment or decree, the terms and conditions of the settlement or compromise of such claim. An Indemnitee’s failure to supply such final court judgment or decree or the terms and conditions of a settlement or compromise to such Indemnifying Party shall not relieve such Indemnifying Party of any of its indemnification obligations contained in this Article IX, except where, and solely to the extent that, such failure actually and materially prejudices the rights of such Indemnifying Party. If the Indemnifying Party is defending the claim as set forth above, the Indemnifying Party shall have the right to settle the claim only with the consent of the Indemnitee.
Article X.
General Provisions
10.1Notices. Any and all notices and other communications hereunder shall be in writing and shall be deemed duly given to the party to whom the same is so delivered, sent or mailed at addresses and contact information set forth below (or at such other address for a party as shall be specified by like notice.) Any and all notices or other communications or deliveries required or permitted to be provided hereunder shall be deemed given and effective on the earliest of: (a) on the date of transmission, if such notice or communication is delivered via e-mail at the e-mail address set forth on the signature pages attached hereto prior to 5:30 p.m. (Eastern Time) on a business day, (b) on the next business day after the date of transmission, if such notice or communication is delivered via facsimile at the facsimile number set forth on the signature pages attached hereto on a day that is not a business day or later than 5:30 p.m. (Eastern Time) on any business day, (c) on the second business day following the date of mailing, if sent by a nationally recognized overnight courier service, or (d) if by personal delivery, upon actual receipt by the party to whom such notice is required to be given.
If to RDAR prior to Closing:7950 East Redfield Road, Unit 210
Scottsdale, AZ 85260
If to Acquired Company:17 Clanwilliam Square, Grand Canal Quay
Dublin 2 D02 DH98, Republic of Ireland
If to the Owner:Via di Affogalasino, 105 - 00148 Roma RM
10.2Definitions. For purposes of this Agreement:
(a)an “affiliate” of any person means another person that directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with, such first person;
(b)“material adverse change” or “material adverse effect” means, when used in connection with Acquired Company or RDAR, any change or effect that either individually or in the aggregate with all other such changes or effects is materially adverse to the business, assets, properties, condition (financial or otherwise) or results of operations of such party and its subsidiaries taken as a whole (after giving effect in the case of RDAR to the consummation of the Share Exchange);
(c)“person” means an individual, corporation, partnership, joint venture, association, trust, unincorporated organization or other entity; and
(d)a “subsidiary” of any person means another person, an amount of the voting securities, other voting ownership or voting partnership interests of which is sufficient to elect at least a majority of its board of Directors or other governing body (or, if there are no such voting interests, fifty percent (50%) or more of the equity interests of which) is owned directly or indirectly by such first person.
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10.3Interpretation. When a reference is made in this Agreement to a Section, Exhibit or Schedule, such reference shall be to a Section of, or an Exhibit or Schedule to, this Agreement unless otherwise indicated. The headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement. Whenever the words “include”, “includes” or “including” are used in this Agreement, they shall be deemed to be followed by the words “without limitation.”
10.4Entire Agreement; No Third-Party Beneficiaries. This Agreement and the other agreements referred to herein constitute the entire agreement, and supersede all prior agreements and understandings, both written and oral, among the parties with respect to the subject matter of this Agreement. This Agreement is not intended to confer upon any person other than the parties any rights or remedies.
10.5Governing Law. This Agreement shall be governed by, and construed in accordance with, the laws of the State of Nevada, regardless of the laws that might otherwise govern under applicable principles of conflicts of laws thereof.
10.6Assignment. Neither this Agreement nor any of the rights, interests or obligations under this Agreement shall be assigned, in whole or in part, by operation of law or otherwise by any of the parties without the prior written consent of the other parties. Subject to the preceding sentence, this Agreement will be binding upon, inure to the benefit of, and be enforceable by, the parties and their respective successors and assigns.
10.7Enforcement. The parties agree that irreparable damage would occur in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached. It is accordingly agreed that the parties shall be entitled to an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions of this Agreement in any court of the United States located in the State of Nevada, this being in addition to any other remedy to which they are entitled at law or in equity. In addition, each of the parties hereto (a) agrees that it will not attempt to deny or defeat such personal jurisdiction or venue by motion or other request for leave from any such court, and (b) agrees that it will not bring any action relating to this Agreement or any of the transactions contemplated by this Agreement in any state court other than such court.
10.8Severability. Whenever possible, each provision or portion of any provision of this Agreement will be interpreted in such manner as to be effective and valid under applicable law but if any provision or portion of any provision of this Agreement is held to be invalid, illegal or unenforceable in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability will not affect any other provision or portion of any provision in such jurisdiction, and this Agreement will be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision or portion of any provision had never been contained herein.
10.9Counterparts. This Agreement may be executed simultaneously in two or more counterparts, any one of which need not contain the signatures of more than one party, but all such counterparts taken together will constitute one and the same Agreement. This Agreement, to the extent delivered by means of a facsimile machine or electronic mail (any such delivery, an “ Electronic Delivery “), shall be treated in all manner and respects as an original agreement or instrument and shall be considered to have the same binding legal effect as if it were the original signed version thereof delivered in person. At the request of any party hereto, each other party hereto shall re-execute original forms hereof and deliver them in person to all other parties. No party hereto shall raise the use of Electronic Delivery to deliver a signature or the fact that any signature or agreement or instrument was transmitted or communicated through the use of Electronic Delivery as a defense to the formation of a contract, and each such party forever waives any such defense, except to the
MEXEDIA DAC SHARE EXCHANGE AGREEMENT | PAGE 23
extent such defense related to lack of authenticity.
10.10Attorneys’ Fees. In the event any suit or other legal proceeding is brought for the enforcement of any of the provisions of this Agreement, the parties hereto agree that the prevailing party or parties shall be entitled to recover from the other party or parties upon final judgment on the merits reasonable attorneys’ fees, including attorneys’ fees for any appeal, and costs incurred in bringing such suit or proceeding.
[ SIGNATURE PAGE FOLLOWS ]
MEXEDIA DAC SHARE EXCHANGE AGREEMENT | PAGE 24
[ SIGNATURE PAGE TO SHARE EXCHANGE AGREEMENT ]
IN WITNESS WHEREOF, the undersigned have caused their duly authorized officers to execute this Agreement as of the date first above written.
RDAR:ACQUIRED COMPANY:
RAADR, INC.MEXEDIA DAC
By: /s/ Jacob DiMartinoBy: /s/ Orlando DiMartino
Jacob DiMartinoOrlando Taddeo
Chief Executive OfficerPresident
E-Mail: jacob.d@raadr.comE-Mail: otaddeo@mexedia.com
OWNER:
MEXEDIA S.p.A. S.B.
By: /s/ Orlando DiMartino
Orlando Taddeo
President
E-Mail: otaddeo@mexedia.com
MEXEDIA DAC SHARE EXCHANGE AGREEMENT | PAGE 25
EXHIBIT A
Certificate of Designation of Series F Preferred Stock
TERMS OF SERIES F PREFERRED STOCK
Section 1. Designation, Amount and Par Value. The series of Preferred Stock shall be designated as Series F Preferred Stock (the “Series F Preferred Stock”) and the number of shares so designated shall be Seventy-Five Thousand (75,000). Each share of the Series F Preferred Stock shall have a par value of $0.001.
Section 2. Fractional Shares. The Series F Preferred Stock may be issued in fractional shares.
Section 3. Voting Rights. The holders of the Series F Preferred Stock shall, as a class, have rights in all matters requiring shareholder approval to a number of votes equal to two (2) times the sum of:
(a)The total number of shares of Company common stock (the “Common Stock”) which are issued and outstanding at the time of any election or vote by the shareholders; plus
(b)The number of votes allocated to shares of Preferred Stock issued and outstanding of any other class that shall have voting rights.
Section 4. Dividends. The holders of the Series F Preferred Stock shall not be entitled to receive dividends paid on the Common Stock.
Section 5. Liquidation. The holders of the Series F Preferred Stock shall not be entitled to any liquidation preference.
Section 6. Conversion and Adjustments.
(a)Conversion Rate. The Series F Preferred Stock shall be convertible into shares of the Company’s common stock, as follows:
Each share of Series F Preferred Stock shall be convertible at any time into a number of shares of Common Stock that equals one-thousandth of one percent (0.001%) of the number of issued and outstanding shares of the Common Stock outstanding on the date of conversion, such that 1,000 shares of Series F Preferred Stock would convert into one percent (1%) of the number of issued and outstanding shares of the Common Stock outstanding on the date of conversion (the “Conversion Rate”).
(b)No Partial Conversion. A holder of shares of Series F Preferred Stock shall be required to convert all of such holder’s shares of Series F Preferred Stock, should any such holder exercise his, her or its rights of conversion.
(c)Adjustment for Merger and Reorganization, etc. If there shall occur any reorganization, recapitalization, reclassification, consolidation or merger (a “Reorganization Event”) involving the Company in which the Common Stock (but not the Series F Preferred Stock) is converted into or exchanged for securities, cash or other property, then each share of Series F Preferred Stock shall be deemed to have been converted into shares of the Common Stock at the Conversion Rate.
Section 7. Protection Provisions. So long as any shares of Series F Preferred Stock are outstanding, the Company shall not, without first obtaining the majority written consent of the holders of Series F Preferred Stock, alter or change the rights, preferences or privileges of the Series F Preferred Stock so as to affect adversely the holders of Series F Preferred Stock.
Section 8. Waiver. Any of the rights, preferences or privileges of the holders of the Series F Preferred Stock may be waived by the affirmative consent or vote of the holders of at least a majority of the shares of Series F Preferred Stock then outstanding.
Section 9. No Other Rights or Privileges. Except as specifically set forth herein, the holder(s) of the shares of Series F Preferred Stock shall have no other rights, privileges or preferences with respect to the Series F Preferred Stock.
MEXEDIA DAC SHARE EXCHANGE AGREEMENT | PAGE 26
EXHIBIT B
Form of US Mexedia SPA
SHARE EXCHANGE AGREEMENT
This Share Exchange Agreement (this “Agreement”) is entered into as of this ____ day of September, 2024, by and among Raadr, Inc., a Nevada corporation (“RDAR”), Mexedia Inc., a Florida corporation (“Acquired Company”), and Mexedia S.p.A. S.B., the owner of Acquired Company (the “Owner”).
RECITALS
WHEREAS, this Agreement is one of a series of agreements that would, when consummated, result in the Company’s (a) having acquired businesses and assets valued in excess of USD$60,000,000 and (b) having undergone a change in control (collectively, the “Change-in-Control Agreements”);
WHEREAS, the Boards of Directors of RDAR, Acquired Company and the Owner have determined that an acquisition of all of the issued and outstanding shares of capital stock of Acquired Company by RDAR through a share exchange upon the terms and subject to the conditions set forth in this Agreement (the “Share Exchange”) would be in the best interests of RDAR, Acquired Company and the Owner; and
WHEREAS, and the Boards of Directors of RDAR and Acquired Company have each approved the Share Exchange; and
WHEREAS, this Agreement is under consideration by the Board of Directors of the Owner for formal determination and approval; and
WHEREAS, pursuant to the Share Exchange, all of the right, title and interest in and to all of the issued and outstanding shares of capital stock of Acquired Company (the “Ownership Interest”) will be exchanged for 45,000 shares of Series F Preferred Stock of RDAR, the Certificate of Designation of which is attached hereto as Exhibit A, including the common stock into which such shares may be converted (the “Exchange Shares”); and
WHEREAS, RDAR, Acquired Company and the Owner desire to make certain representations, warranties, covenants and agreements in connection with the Share Exchange and also to prescribe various conditions to the Share Exchange.
NOW, THEREFORE, in consideration of the representations, warranties, covenants and agreements contained in this Agreement, the parties agree as follows:
Article I.
The Exchange
1.1Share Exchange. Upon the terms and subject to the conditions set forth in this Agreement, and in accordance with the Nevada Revised Statutes (the “Nevada Statutes”), at the Closing (defined below), the parties shall do the following:
(a)Acquired Company shall cause the Owner to convey, assign and transfer the Ownership Interest to RDAR by delivering to RDAR duly executed assignments in proper form for transfer. The Ownership Interest transferred to RDAR at the Closing shall constitute 100% of the issued and outstanding shares of capital stock of Acquired Company.
(b)As consideration for its acquisition of the Ownership Interest, RDAR shall issue the Exchange Shares to the Owner by delivering a book entry record to the Owner evidencing the Exchange Shares (the “Exchange Shares Certificate”).
1.2Closing. Unless this Agreement shall have been terminated and the transactions herein contemplated shall have been abandoned pursuant to Article VIII, the closing date of the Exchange (the “Closing”) will take place on the business day upon satisfaction of the conditions set forth in Article VI (or as soon as practicable thereafter following satisfaction or waiver of the conditions set forth in Article VI) (the “Closing Date”), at such time and location as may be agreed upon by RDAR and Acquired Compan; provided, however, that the Closing shall take place no later than January 31, 2025.
1.3Reorganization.
(a)As of the Closing, Jacob DiMartino shall resign as RDAR’s sole director and officer and Orlando Taddeo shall be appointed as the sole director and officer of RDAR.
(b)If at any time after the Closing, any party shall consider that any further deeds, assignments, conveyances, agreements, documents, instruments or assurances in law or any other things are necessary or desirable to vest, perfect, confirm or record in RDAR the title to any property, rights, privileges, powers and franchises of Acquired Company by reason of, or as a result of, the Share Exchange, or otherwise to carry out the provisions of this Agreement, the remaining parties, as applicable, shall execute and deliver, upon request, any instruments or assurances, and do all other things necessary or proper to vest, perfect, confirm or record title to such property, rights, privileges, powers and franchises in RDAR, and otherwise to carry out the provisions of this Agreement.
Article II.
Compliance with Applicable Securities Laws
2.1Covenants, Representations and Warranties of the Owner.
(a)The Owner acknowledges and agrees that it is acquiring the Exchange Shares for investment purposes and will not offer, sell or otherwise transfer, pledge or hypothecate any of the Exchange Shares issued to them (other than pursuant to an effective Registration Statement under the Securities Act of 1933, as amended (the “Securities Act”)) directly or indirectly unless:
(1)the sale is to RDAR; or
(2)the Exchange Shares are sold in a transaction that does not require registration under the Securities Act, or any applicable United States state laws and regulations governing the offer and sale of securities, and the seller has furnished to RDAR an opinion of counsel to that effect or such other written opinion as may be reasonably required by RDAR.
(b)The Owner acknowledges and agrees that the book entry record representing the Exchange Shares shall bear a restrictive legend, substantially in the following form:
“THE SECURITIES REPRESENTED BY THIS STOCK CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”) OR APPLICABLE STATE SECURITIES LAWS, AND SHALL NOT BE SOLD, PLEDGED, HYPOTHECATED, DONATED, OR OTHERWISE TRANSFERRED (WHETHER OR NOT FOR CONSIDERATION) BY THE HOLDER EXCEPT UPON THE ISSUANCE TO THE COMPANY OF A FAVORABLE OPINION OF ITS COUNSEL OR THE SUBMISSION TO THE COMPANY OF SUCH OTHER EVIDENCE AS MAY BE SATISFACTORY TO COUNSEL FOR THE COMPANY, TO THE EFFECT THAT ANY SUCH TRANSFER SHALL NOT BE IN VIOLATION OF THE SECURITIES ACT OR APPLICABLE STATE SECURITIES LAWS.”
(c)The Owner represents and warrants that it:
(1)is not aware of any advertisement of, or other form or general solicitation with respect to, any of the Exchange Shares being issued hereunder;
(2)acknowledges and agrees that RDAR will refuse to register any transfer of the Exchange Shares not made pursuant to an effective registration statement under the Securities Act or pursuant to an available exemption from the registration requirements of the Securities Act and in accordance with applicable state and provincial securities laws; and
(3)acknowledges and agrees to RDAR making a notation on its records or giving instructions to the registrar and transfer agent of RDAR in order to implement the restrictions on transfer set forth and described herein.
Article III.
Representations and Warranties
3.1Representations and Warranties of Acquired Company and the Owner. As a material inducement for RDAR to enter into this Agreement and to consummate the transactions contemplated hereby, Acquired Company and the Owner hereby make the following representations and warranties as of the date hereof and as of the Closing Date, each of which is relied upon by RDAR regardless of any investigation made or information obtained by RDAR (unless and to the extent specifically and expressly waived in writing by RDAR on or before the Closing Date):
(a)Organization, Standing and Power; No Disability. Acquired Company is duly organized, validly existing and in good standing under the laws of the State of Florida. The Owner is duly organized, validly existing and in good standing under the laws of its organization.
(b)Subsidiaries. Acquired Company has two subsidiaries: (1) Matchcom Technologies, Inc., a Florida corporation; and (2) Phonetime, Inc., a Florida corporation.
(c)Corporate Documents. Schedule 3.1(c) contains true and correct copies of the Articles of Incorporation and bylaws of Acquired Company, each as amended to date.
(d)Ownership Interest. The Ownership Interest represents 100% of the issued and outstanding shares of capital stock of
Acquired Company. Acquired Company also warrants that there are no outstanding bonds, debentures, notes or other indebtedness or other securities of Acquired Company. There are no rights, commitments, agreements, arrangements or undertakings of any kind to which Acquired Company is a party or by which it is bound obligating Acquired Company to issue, deliver or sell, or cause to be issued, delivered or sold, additional ownership interests of Acquired Company or obligating Acquired Company to issue, grant, extend or enter into any such right, commitment, agreement, arrangement or undertaking. There are no outstanding contractual obligations, commitments, understandings or arrangements of Acquired Company to repurchase, redeem or otherwise acquire or make any payment in respect of the capital stock of Acquired Company.
(e)Capitalization of Acquired Company. Schedule 3(e) sets forth the issued and outstanding shares of capital stock of Acquired Company (the Ownership Interest). All of Acquired Company’s issued and outstanding shares of capital stock have been duly authorized, are validly issued, fully paid and non-assessable.
(f)Authority; Non-contravention. Acquired Company and the Owner have all requisite power and authority to enter into this Agreement and to consummate the transactions contemplated by this Agreement. The execution and delivery of this Agreement by Acquired Company and its Owner and the consummation by Acquired Company and the Owner of the transactions contemplated hereby have been (or at Closing will have been) duly authorized by all necessary action on the part of Acquired Company. This Agreement has been duly executed and when delivered by Acquired Company and the Owner shall constitute a valid and binding obligation of Acquired Company and the Owner, enforceable against Acquired Company and the Owner, as applicable, in accordance with its terms, except as such enforcement may be limited by bankruptcy, insolvency or other similar laws affecting the enforcement of creditors’ rights generally or by general principles of equity. The execution and delivery of this Agreement does not, and the consummation of the transactions contemplated by this Agreement and compliance with the provisions hereof will not, conflict with, or result in any breach or violation of, or default (with or without notice or lapse of time, or both) under, or give rise to a right of termination, cancellation or acceleration of or “put” right with respect to any obligation or to a loss of a material benefit under, or result in the creation of any lien upon any of the properties or assets of Acquired Company under, (1) the articles of incorporation or bylaws of Acquired Company, (2) any loan or credit agreement, note, bond, mortgage, indenture, lease or other agreement, instrument, permit, concession, franchise or license applicable to Acquired Company, its properties or assets, or (3) subject to the governmental filings and other matters referred to in the following sentence, any judgment, order, decree, statute, law, ordinance, rule, regulation or arbitration award applicable to Acquired Company, its properties or assets, other than, in the case of clauses (ii) and (iii), any such conflicts, breaches, violations, defaults, rights, losses or liens that individually or in the aggregate could not have a material adverse effect with respect to Acquired Company or could not prevent, hinder or materially delay the ability of Acquired Company to consummate the transactions contemplated by this Agreement.
(g)Governmental Authorization. No consent, approval, order or authorization of, or registration, declaration or filing with, or notice to, any United States court, administrative agency or commission, or other federal, state or local government or other governmental authority, agency, domestic or foreign (a “Governmental Entity”), is required by or with respect to Acquired Company in connection with the execution and delivery of this Agreement by Acquired Company or the consummation by Acquired Company of the transactions contemplated hereby, except, with respect to this Agreement, any filings under the Securities Act or the Securities Exchange Act of 1934 and the rules and regulations promulgated thereunder (the “Exchange Act”) or pursuant to the rules of OTC Markets.
(h)Financial Statements.
(1)At Closing, RDAR will have received from Acquired Company a copy of its unaudited financial statements for the years ended December 31, 2023 and 2022, and for the six months ended June 30, 2024 (collectively, the “Acquired Company Financial Statements”). The Acquired Company Financial Statements fairly present the financial condition of Acquired Company at the dates indicated and its results of operations and cash flows for the periods then ended and, except as indicated therein, reflect all claims, debts and liabilities of Acquired Company, fixed or contingent, and of whatever nature.
(2)Since June 30, 2024, there has been no material adverse change in the assets or liabilities, or in the business or condition, financial or otherwise, or in the results of operations or prospects, of Acquired Company, whether as a result of any legislative or regulatory change, revocation of any license or rights to do business, fire, explosion, accident, casualty, labor trouble, flood, drought, riot, storm, condemnation, act of God, public force or otherwise and no material adverse change in the assets or liabilities, or in the business or condition, financial or otherwise, or in the results of operation or prospects, of Acquired Company except in the ordinary course of business.
(3)Since June 30, 2024, Acquired Company has not issued, sold or otherwise disposed of, or agreed to issue, sell or otherwise dispose of, any securities of Acquired Company, and has not granted or agreed to grant any other right to subscribe for or to purchase any securities of Acquired Company or has incurred or agreed to incur any indebtedness for borrowed money.
(i)Absence of Certain Changes or Events. Since June 30, 2024, Acquired Company has conducted its business only in the ordinary course consistent with past practice, and there is not and has not been any:
(1)material adverse change with respect to Acquired Company including any amendments to its formation and governance documents;
(2)event which, if it had taken place following the execution of this Agreement, would not have been permitted by Section 4.1 without prior consent of RDAR;
(3)condition, event or occurrence which could reasonably be expected to prevent, hinder or materially delay the ability of Acquired Company to consummate the transactions contemplated by this Agreement;
(4)incurrence, assumption or guarantee by Acquired Company of any indebtedness for borrowed money other than in the ordinary course and in amounts and on terms consistent with past practices or as disclosed to RDAR in writing;
(5)creation or other incurrence by Acquired Company of any lien on any asset other than in the ordinary course consistent with past practices;
(6)transaction or commitment made, or any contract or agreement entered into, by Acquired Company relating to its assets or business (including the acquisition or disposition of any assets) or any relinquishment by Acquired Company of any contract or other right, in either case, material to Acquired Company, other than transactions and commitments in the ordinary course consistent with past practices and those contemplated by this Agreement;
(7)labor dispute, other than routine, individual grievances, or, to the knowledge of Acquired Company, any activity or proceeding by a labor union or representative thereof to organize any employees of Acquired Company or any lockouts, strikes, slowdowns, work stoppages or threats by or with respect to such employees;
(8)payment, prepayment or discharge of liability other than in the ordinary course of business or any failure to pay any liability when due;
(9)write-offs or write-downs of any assets of Acquired Company;
(10)creation, termination or amendment of, or waiver of any right under, any material contract of Acquired Company;
(11)damage, destruction or loss having, or reasonably expected to have, a material adverse effect on Acquired Company;
(12)other condition, event or occurrence which individually or in the aggregate could reasonably be expected to have a material adverse effect or give rise to a material adverse change with respect to Acquired Company; or
(13)agreement or commitment to do any of the foregoing.
(j)Certain Fees. No brokerage or finder’s fees or commissions are or will be payable by Acquired Company to any broker, financial advisor or consultant, finder, placement agent, investment banker, bank or other person with respect to the transactions contemplated by this Agreement.
(k)Litigation; Labor Matters; Compliance with Laws.
(1)Except as set forth in Schedule 3(k)(1), there is no suit, action or proceeding or investigation pending or, to the knowledge of Acquired Company, threatened against or affecting Acquired Company or any basis for any such suit, action, proceeding or investigation that, individually or in the aggregate, could reasonably be expected to have a material adverse effect with respect to Acquired Company or prevent, hinder or materially delay the ability of Acquired Company to consummate the transactions contemplated by this Agreement, nor is there any judgment, decree, injunction, rule or order of any governmental entity or arbitrator outstanding against Acquired Company having, or which, insofar as reasonably could be foreseen by Acquired Company, in the future could have, any such effect.
(2)Acquired Company is not a party to, or bound by, any collective bargaining agreement, contract or other agreement or understanding with a labor union or labor organization, nor is it the subject of any proceeding asserting that it has committed an unfair labor practice or seeking to compel it to bargain with any labor organization as to wages or conditions of employment nor is there any strike, work stoppage or other labor dispute involving it pending or, to its knowledge, threatened, any of which could have a material adverse effect with respect to Acquired Company.
(3)The conduct of the business of Acquired Company complies with all statutes, laws, regulations, ordinances, rules, judgments, orders, decrees or arbitration awards applicable thereto.
(l)Benefit Plans. Acquired Company is not a party to any Benefit Plan under which Acquired Company currently has an obligation to provide benefits to any current or former employee, officer or director of Acquired Company. As used herein, “Benefit Plan” shall mean any employee benefit plan, program, or arrangement of any kind, including any defined benefit or defined contribution plan, ownership plan with respect to any membership interest, executive compensation program or arrangement, bonus plan, incentive compensation plan or arrangement, profit sharing plan or arrangement, deferred compensation plan, agreement or arrangement, supplemental retirement plan or arrangement, vacation pay, sickness, disability, or death benefit plan (whether provided through insurance, on a funded or unfunded basis, or otherwise), medical or life insurance plan providing benefits to employees, retirees, or former employees or any of their dependents, survivors, or beneficiaries, severance pay, termination, salary continuation, or employee assistance plan.
(m)Tax Returns and Tax Payments.
(1)Acquired Company has timely filed with the appropriate taxing authorities all Tax Returns, as that term is
hereinafter defined, required to be filed by it (taking into account all applicable extensions). All such Tax Returns are true, correct and complete in all respects. All Taxes, as that term is hereinafter defined, due and owing by Acquired Company have been paid (whether or not shown on any Tax Return and whether or not any Tax Return was required). Acquired Company is not currently the beneficiary of any extension of time within which to file any Tax Return or pay any Tax. No claim has ever been made in writing or otherwise addressed to Acquired Company by a taxing authority in a jurisdiction where Acquired Company does not fileTax Returns that it is or may be subject to taxation by that jurisdiction. Since inception, Acquired Company has not incurred any liability for Taxes outside the ordinary course of business consistent with past custom and practice.
(2)No material claim for unpaid Taxes has been made or become a lien against the property of Acquired Company or is being asserted against Acquired Company, no audit of any Tax Return of Acquired Company is being conducted by a tax authority, and no extension of the statute of limitations on the assessment of any Taxes has been granted by Acquired Company and is currently in effect. Acquired Company has withheld and paid all Taxes required to have been withheld and paid in connection with amounts paid or owing to any employee, independent contractor, creditor, stockholder or other third party.
(3)As used herein, “Taxes” shall mean all taxes of any kind, including, without limitation, those on or measured by or referred to as income, gross receipts, sales, use, ad valorem, franchise, profits, license, withholding, payroll, employment, excise, severance, stamp, occupation, premium value added, property or windfall profits taxes, customs, duties or similar fees, assessments or charges of any kind whatsoever, together with any interest and any penalties, additions to tax or additional amounts imposed by any governmental authority, domestic or foreign. As used herein, “ Tax Return “ shall mean any return, report or statement required to be filed with any governmental authority with respect to Taxes.
(n)Environmental Matters. Acquired Company is in compliance with all Environmental Laws in all material respects. Acquired Company has not received any written notice regarding any violation of any Environmental Laws, as that term is hereinafter defined, including any investigatory, remedial or corrective obligations. Acquired Company holds all permits and authorizations required under applicable Environmental Laws, unless the failure to hold such permits and authorizations would not have a material adverse effect on Acquired Company, and is in compliance with all terms, conditions and provisions of all such permits and authorizations in all material respects. No releases of Hazardous Materials, as that term is hereinafter defined, have occurred at, from, in, to, on or under any real property currently or formerly owned, operated or leased by Acquired Company or any predecessor thereof and no Hazardous Materials are present in, on, about or migrating to or from any such property which could result in any liability to Acquired Company. Acquired Company has not transported or arranged for the treatment, storage, handling, disposal, or transportation of any Hazardous Material to any off-site location which could result in any liability to Acquired Company. Acquired Company has no liability, absolute or contingent, under any Environmental Law that if enforced or collected would have a material adverse effect on Acquired Company. There are no past, pending or threatened claims under Environmental Laws against Acquired Company and Acquired Company is not aware of any facts or circumstances that could reasonably be expected to result in a liability or claim against Acquired Company pursuant to Environmental Laws. “Environmental Laws” means all applicable foreign, federal, state and local statutes, rules, regulations, ordinances, orders, decrees and common law relating in any manner to contamination, pollution or protection of human health or the environment, and similar state laws. “Hazardous Material” means any toxic, radioactive, corrosive or otherwise hazardous substance, including petroleum, its derivatives, by-products and other hydrocarbons, or any substance having any constituent elements displaying any of the foregoing characteristics, which in any event is regulated under any Environmental Law.
(o)Material Contracts. All Material Contracts copies of which have been furnished to RDAR. Acquired Company is not, or has not received any notice or has any knowledge that any other party is, in default in any respect under any Material Contract, as that term is hereinafter defined; and there has not occurred any event that with the lapse of time or the giving of notice or both would constitute such a material default.
For purposes of this Agreement, a “Material Contract” means any contract, agreement or commitment that is effective as of the Closing Date to which Acquired Company is a party (1) with expected receipts or expenditures in an amount in excess of two percent (2%) of Acquired Company’s gross revenues for the 12 months ended July 31, 2025, (2) requiring Acquired Company to indemnify any person in an amount that is expected to exceed ten percent (10%) of Acquired Company’s owners’ equity as of the date of Closing, (3) granting exclusive rights to any party, (4) evidencing indebtedness for borrowed or loaned money in an amount in excess of ten percent (10%) of Acquired Company’s owners’ equity, including guarantees of such indebtedness, as of the date of Closing, or (5) which, if breached by Acquired Company in such a manner would (A) permit any other party to cancel or terminate the same (with or without notice of passage of time) or (B) provide a basis for any other party to claim money damages (either individually or in the aggregate with all other such claims under that contract) from Acquired Company or (C) give rise to a right of acceleration of any material obligation or loss of any material benefit under any such contract, agreement or commitment.
(p)Properties. Acquired Company has no real property. Any facilities held under lease by Acquired Company is held by it under valid, subsisting and enforceable leases of which Acquired Company is in compliance, except as could not, individually or in the aggregate, have or reasonably be expected to result in a material adverse effect.
(q)Intellectual Property.
(1)As used in this Agreement, the term “Trademarks” means trademarks, service marks, trade names, internet domain names, designs, slogans, and general intangibles of like nature; the term “Trade Secrets” means technology; trade secrets and other confidential information, know-how, proprietary processes, formulae, algorithms, models, and methodologies; the term “ Intellectual Property “ means patents, copyrights, Trademarks, applications for any of the foregoing, and Trade Secrets; the term “ Company License Agreements “ means any license agreements granting any right to use or practice any rights under any Intellectual Property (except for such agreements for off-the-shelf products that are generally available for less than $10,000), and any written settlements relating to any Intellectual Property, to which Acquired Company is a party or otherwise bound; and the term “ Software “ means any and all computer programs, including any and all software
implementations of algorithms, models and methodologies, whether in source code or object code.
(2)Acquired Company owns or has valid rights to use the Trademarks, trade names, domain names, copyrights, patents, logos, licenses and computer software programs (including, without limitation, the source codes thereto) that are necessary for the conduct of its respective businesses as now being conducted. To the knowledge of Acquired Company, none of Acquired Company’s Intellectual Property or License Agreements infringe upon the rights of any third party that may give rise to a cause of action or claim against Acquired Company or its successors.
(r)Affiliate Transactions. Except as set forth in Schedule 3(r), no officer, director or employee of Acquired Company or any member of the immediate family of any such officer, director or employee, or any entity in which any of such persons owns any beneficial interest (other than any publicly-held corporation whose stock is traded on a national securities exchange or in the over-the-counter market and less than one percent of the stock of which is beneficially owned by any of such persons), has any agreement with Acquired Company or any interest in any of their property of any nature, used in or pertaining to the business of Acquired Company. None of the foregoing persons has any direct or indirect interest in any competitor, supplier or customer of Acquired Company or in any person from whom or to whom Acquired Company leases any property or transacts business of any nature.
(s)Undisclosed Liabilities. Except as set forth in Schedule 3(s), Acquired Company has no liabilities or obligations of any nature (whether fixed or unfixed, secured or unsecured, known or unknown and whether absolute, accrued, contingent, or otherwise.)
(t)Full Disclosure. All of the representations and warranties made by Acquired Company in this Agreement, and all statements set forth in the certificates delivered by Acquired Company at the Closing pursuant to this Agreement, are true, correct and complete in all material respects and do not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make such representations, warranties or statements, in light of the circumstances under which they were made, misleading. The copies of all documents furnished by Acquired Company pursuant to the terms of this Agreement are complete and accurate copies of the original documents. The schedules, certificates, and any and all other statements and information, whether furnished in written or electronic form, to RDAR or its representatives by or on behalf of any of Acquired Company or its affiliates in connection with the negotiation of this Agreement and the transactions contemplated hereby do not contain any material misstatement of fact or omit to state a material fact or any fact necessary to make the statements contained therein not misleading.
3.2Representations and Warranties of RDAR. As a material inducement for Acquired Company and the Owner to enter into this Agreement and to consummate the transactions contemplated hereby, RDAR hereby makes the following representations and warranties as of the date hereof and as of the Closing Date, each of which is relied upon by Acquired Company regardless of any investigation made or information obtained by Acquired Company (unless and to the extent specifically and expressly waived in writing by Acquired Company on or before the Closing Date):
(a)Organization, Standing and Corporate Power. RDAR is a corporation duly organized, validly existing and in good standing under the laws of the State of Nevada and has the requisite corporate power and authority and all government licenses, authorizations, permits, consents and approvals required to own, lease and operate its properties and carry on its business as now being conducted. RDAR is duly qualified or licensed to do business and is in good standing in each jurisdiction in which the nature of its business or the ownership or leasing of its properties makes such qualification or licensing necessary, other than in such jurisdictions where the failure to be so qualified or licensed (individually or in the aggregate) would not have a material adverse effect with respect to RDAR.
(b)Subsidiaries. RDAR has no subsidiaries.
(c)Capitalization of RDAR. The entire authorized capital stock of RDAR consists of 15,000,000,000 common shares, par value $0.001 per share, of which 4,433,149,661 shares are issued and outstanding, and 100,000,000 shares of preferred stock, par value $0.001 per share, (1) 1,000,000 shares of which are designated Series E Preferred Stock and 1,000,000 shares of which are issued and outstanding and (2) 75,000 shares of which are designated Series F Preferred Stock and no shares of which are issued and outstanding. All of RDAR’s issued and outstanding shares have been duly authorized, are validly issued, fully paid and non-assessable.
Except as set forth in Schedule 3.2(c), there are no other shares of RDAR capital stock issuable upon the exercise of outstanding warrants, convertible notes, options or otherwise. Except as set forth in Schedule 3.2(c), no shares of capital stock or other equity securities of RDAR are issued, reserved for issuance or outstanding.
The Exchange Shares will be, when issued, duly authorized, validly issued, fully paid and non-assessable, not subject to preemptive rights and issued in compliance with all applicable state and federal laws concerning the issuance of securities.
(d)Corporate Authority; Non-contravention. RDAR has all requisite corporate and other power and authority to enter into this Agreement and to consummate the transactions contemplated by this Agreement. The execution and delivery of this Agreement by RDAR and the consummation by RDAR of the transactions contemplated hereby have been (or at Closing will have been) duly authorized by all necessary corporate action on the part of RDAR. This Agreement has been duly executed and when delivered by RDAR shall constitute a valid and binding obligation of RDAR, enforceable against RDAR in accordance with its terms, except as such enforcement may be limited by bankruptcy, insolvency or other similar laws affecting the enforcement of creditors’ rights generally or by general principles of equity. The execution and delivery of this Agreement does not, and the consummation of the transactions contemplated by this Agreement and compliance with the provisions hereof will not, conflict with, or result in any breach or violation of, or default (with or without notice or lapse of time, or both) under, or give rise to a right of termination, cancellation or acceleration of or “put” right with respect to any obligation or to loss of a material benefit under, or result in the creation
of any lien upon any of the properties or assets of RDAR under (1) its articles of incorporation, bylaws, or other charter documents; (2) any loan or credit agreement, note, bond, mortgage, indenture, lease or other agreement, instrument, permit, concession, franchise or license applicable to RDAR,its properties or assets; or (3) subject to the governmental filings and other matters referred to in the following sentence, any judgment, order, decree, statute, law, ordinance, rule, regulation or arbitration award applicable to RDAR, its properties or assets, other than, in the case of clauses (2) and (3), any such conflicts, breaches, violations, defaults, rights, losses or liens that individually or in the aggregate could not have a material adverse effect with respect to RDAR or could not prevent, hinder or materially delay the ability of RDAR to consummate the transactions contemplated by this Agreement.
(e)Government Authorization. No consent, approval, order or authorization of, or registration, declaration or filing with, or notice to, any Governmental Entity, is required by or with respect to RDAR in connection with the execution and delivery of this Agreement by RDAR, or the consummation by RDAR of the transactions contemplated hereby, except, with respect to this Agreement, any filings under the Nevada Statutes, the Securities Act or the Exchange Act.
(f)Financial Statements.
(1)The unaudited financial statements of RDAR included in the reports, schedules, forms, statements and other documents filed by RDAR with OTC Markets (collectively, and in each case including all exhibits and schedules thereto and documents incorporated by reference therein, the “RDAR Financial Information”) comply as to form in all material respects with applicable accounting requirements and the published rules of OTC Markets with respect thereto, have been prepared in accordance with U.S. generally accepted accounting principles applied on a consistent basis during the periods involved (except as may be indicated in the notes thereto) and fairly present the consolidated financial position of RDAR and its consolidated subsidiaries as of the dates thereof and the consolidated results of operations and changes in cash flows for the periods then ended. Except as set forth in the RDAR Financial Information, at the date of the most recent unaudited financial statements of RDAR included in the RDAR Financial Information, RDAR has not incurred any liabilities or obligations of any nature (whether accrued, absolute, contingent or otherwise) which, individually or in the aggregate, could reasonably be expected to have a material adverse effect with respect to RDAR.
(2)RDAR has made the following financial information (the RDAR Financial Information) available to Acquired Company:
(A)unaudited balance sheet and statements of income, changes in stockholders’ equity and cash flow as of and for the years ended December 31, 2023 and 2022;
(B)unaudited balance sheet and statements of income, changes in stockholders’ equity and cash flow as of and for the six months ended June 30, 2024 (the “RDAR Interim Statements”); and
(C)The RDAR Financial Information presents fairly the financial condition of RDAR as of such dates and the results of operations of RDAR for such periods, in accordance with GAAP and are consistent with the books and records of RDAR (which books and records are correct and complete).
(g)Events Subsequent to RDAR Interim Statements. Since the date of the RDAR Interim Statements, there has not been, occurred or arisen, with respect to RDAR:
(1)any change or amendment in its Articles of Incorporation and/or Bylaws;
(2)any reclassification, split-up or other change in, or amendment of or modification to, the rights of the holders of any of its capital stock, except changes made in relation to the transactions contemplated by this Agreement;
(3)any direct or indirect redemption, purchase or acquisition by any person of any of its capital stock or of any interest in or right to acquire any such stock;
(4)any issuance, sale, or other disposition of any capital stock, or any grant of any options, warrants, or other rights to purchase or obtain (including upon conversion, exchange, or exercise) any capital stock;
(5)any declaration, set aside, or payment of any dividend or any distribution with respect to its capital stock (whether in cash or in kind) or any redemption, purchase, or other acquisition of any of its capital stock;
(6)the organization of any subsidiary or the acquisition of any shares of capital stock by any person or any equity or ownership interest in any business;
(7)any damage, destruction or loss of any of its properties or assets whether or not covered by insurance;
(8)any sale, lease, transfer or assignment of any of its assets, tangible or intangible, other than for a fair consideration in the ordinary course of business;
(9)the execution of, or any other commitment to any agreement, contract, lease, or license (or series of related agreements, contracts, leases, and licenses) outside the ordinary course of business;
(10)any acceleration, termination, modification, or cancellation of any agreement, contract lease or license (or series of related agreements, contracts, leases, and licenses) involving more than $10,000 to which it is a party or by which it is bound;
(11)any security interest or encumbrance imposed upon any of its assets, tangible;
(12)any capital investment in, any loan to, or any acquisition of the securities or assets of, any other person or entity (or series of related capital investments, loans and acquisitions) involving more than $2,500 and outside the ordinary course of business;
(13)any issuance of any note, bond or other debt security, or created, incurred, assumed, or guaranteed any indebtedness for borrowed money or capitalized lease obligation involving more than $2,500;
(14)any delay or postponement of the payment of accounts payable or other liabilities;
(15)any loan to, or any entrance into any other transaction with, any of its directors, officers and employees either involving more than $500 individually or $2,500 in the aggregate;
(16)any employment contract or collective bargaining agreement, written or oral, or modified the terms of any existing such contract or agreement;
(17)any taking of other action or entrance into any other transaction other than in the ordinary course of business, or entrance into any transaction with any insider of RDAR, except as disclosed in this Agreement and any disclosures schedules;
(18)any other event or occurrence that may have or could reasonably be expected to have a material adverse effect on RDAR (whether or not similar to any of the foregoing); or
(19)any agreement, whether in writing or otherwise, to do any of the foregoing.
(h)Certain Fees. No brokerage or finder’s fees or commissions are or will be payable by RDAR to any broker, financial advisor or consultant, finder, placement agent, investment banker, bank or other person with respect to the transactions contemplated by this Agreement.
(i)Litigation; Labor Matters; Compliance with Laws.
(1)There is no suit, action or proceeding or investigation pending or, to the knowledge of RDAR, threatened against or affecting RDAR or any basis for any such suit, action, proceeding or investigation that, individually or in the aggregate, could reasonably be expected to have a material adverse effect with respect to RDAR or prevent, hinder or materially delay the ability of RDAR to consummate the transactions contemplated by this Agreement, nor is there any judgment, decree, injunction, rule or order of any Governmental Entity or arbitrator outstanding against RDAR having, or which, insofar as reasonably could be foreseen by RDAR, in the future could have, any such effect.
(2)The conduct of the business of RDAR complies with all statutes, laws, regulations, ordinances, rules, judgments, orders, decrees or arbitration awards applicable thereto.
(j)Contracts. Except as set forth in Schedule 3.2(j), RDAR has no written or oral contracts, understandings, agreements and other arrangements executed by an officer or duly authorized employee of RDAR or to which RDAR is a party, except for this Agreement.
(k)OTC Markets Reports and Financial Statements. RDAR has filed with OTC Markets all reports and other filings required to be filed by RDAR in accordance with the rules of OTC Markets (the “RDAR OTC Markets Reports”). As of their respective dates, the RDAR OTC Markets Reports complied in all material respects with the applicable requirements of the Securities Act, the Exchange Act and the respective rules and regulations promulgated thereunder applicable to such RDAR OTC Markets Reports and, except to the extent that information contained in any RDAR OTC Markets Report has been revised or superseded by a later RDAR OTC Markets Report filed and publicly available prior to the date of this Agreement, none of the RDAR OTC Markets Reports contained any untrue statement of a material fact or omitted to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. The financial statements of RDAR included in RDAR OTC Markets Reports were prepared from and are in accordance with the accounting books and other financial records of RDAR, were prepared in accordance with GAAP applied on a consistent basis during the periods involved (except as may be indicated in the notes thereto) and presented fairly the consolidated financial position of RDAR as of the dates thereof and the consolidated results of operations and cash flows for the periods then ended. Except as set forth in the RDAR OTC Markets Reports, RDAR has no liabilities or obligations of any nature (whether accrued, absolute, contingent or otherwise) other than liabilities or obligations incurred in the ordinary course of business. The RDAR OTC Markets Reports accurately disclose (1) the terms and provisions of all stock option plans, (2) transactions with Affiliates and (3) all material contracts. If at any time prior to Closing should RDAR become delinquent in any required filings with OTC Markets, RDAR represents and warrants that such filings shall be brought current in no less than 10 business days from the due date. Until such time as the filing is brought current, RDAR will promptly file any and all reports required to advise the SEC of the failure to file the reports when due.
(l)Board Determination. The Board of Directors of RDAR has unanimously determined that the terms of the Share
Exchange are fair to and in the best interests of RDAR and its stockholders.
(m)Required RDAR Share Issuance Approval. RDAR represents that the issuance of the Exchange Shares to the Owner will be in compliance with the Nevada Statutes and the Bylaws of RDAR, as well as federal and state securities laws.
(n)Undisclosed Liabilities. Except as set forth in Schedule 3.2(n), RDAR has no liabilities or obligations of any nature (whether fixed or unfixed, secured or unsecured, known or unknown and whether absolute, accrued, contingent, or otherwise) except for liabilities or obligations reflected or reserved against in the RDAR OTC Markets Documents incurred in the ordinary course of business.
(o)Full Disclosure. All of the representations and warranties made by RDAR in this Agreement, and all statements set forth in the certificates delivered by RDAR at the Closing pursuant to this Agreement, are true, correct and complete in all material respects and do not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make such representations, warranties or statements, in light of the circumstances under which they were made, misleading. The copies of all documents furnished by RDAR pursuant to the terms of this Agreement are complete and accurate copies of the original documents. The schedules, certificates, and any and all other statements and information, whether furnished in written or electronic form, to Acquired Company or its representatives by or on behalf of RDAR in connection with the negotiation of this Agreement and the transactions contemplated hereby do not contain any material misstatement of fact or omit to state a material fact or any fact necessary to make the statements contained therein not misleading.
(p)Powers of Attorney. There are no outstanding powers of attorney executed on behalf of RDAR.
Article IV.
Covenants Relating to Conduct of Business Prior to Share Exchange
4.1Conduct of Acquired Company and RDAR. From the date of this Agreement and until the Effective Time, or until the prior termination of this Agreement, Acquired Company and RDAR shall not, unless mutually agreed to in writing:
(a)engage in any transaction, except in the normal and ordinary course of business, or create or suffer to exist any lien or other encumbrance upon any of their respective assets or which will not be discharged in full prior to the Effective Time;
(b)sell, assign or otherwise transfer any of their assets, or cancel or compromise any debts or claims relating to their assets, other than for fair value, in the ordinary course of business, and consistent with past practice;
(c)fail to use reasonable efforts to preserve intact their present business organizations, keep available the services of their employees and preserve its material relationships with customers, suppliers, licensors, licensees, distributors and others, to the end that its good will and ongoing business not be impaired prior to the Effective Time;
(d)suffer or permit any material adverse change to occur with respect to Acquired Company and RDAR or their business or assets; and
(e)make any material change with respect to their business in accounting or bookkeeping methods, principles or practices, except as required by GAAP.
4.2Current Information.
(a)During the period from the date of this Agreement to the Closing, each party hereto shall promptly notify each other party of any (1) significant change in its ordinary course of business, (2) proceeding (or communications indicating that the same may be contemplated), or the institution or threat or settlement of proceedings, in each case involving the Parties the outcome of which, if adversely determined, could reasonably be expected to have a material adverse effect on the Party, taken as a whole or (3) event which such Party reasonably believes could be expected to have a material adverse effect on the ability of any party hereto to consummate the Share Exchange.
(b)During the period from the date of this Agreement to the Closing, RDAR shall promptly notify Acquired Company of any correspondence received from OTC Markets or the SEC and shall deliver a copy of such correspondence to Acquired Company within one (1) business day of receipt.
4.3Material Transactions. Prior to the Closing, neither Acquired Company nor RDAR will, without first obtaining the written consent of the other parties hereto:
(a)amend its Articles of Incorporation or Bylaws or enter into any agreement to merge or consolidate with, or sell a significant portion of its assets to, any other Person;
(b)place on any of its assets or properties any pledge, charge or other encumbrance, except as otherwise authorized hereunder, or enter into any transaction or make any contract or commitment relating to its properties, assets and business, other than in the ordinary course of business or as otherwise disclosed herein;
(c)guarantee the obligation of any person, firm or corporation, except in the ordinary course of business;
(d)make any loan or advance in excess of $2,500 in the aggregate or cancel or accelerate any material indebtedness owing to it or any claims which it may possess or waive any material rights of substantial value;
(e)violate any applicable law which violation might have a material adverse effect on such party;
(f)except in the ordinary course of business, enter into any agreement or transaction with any of such party’s affiliates; or
(g)engage in any transaction or take any action that would render untrue in any material respect any of the representations and warranties of such party contained in this Agreement, as if such representations and warranties were given as of the date of such transaction or action.
Article V.
Additional Agreements
5.1Reorganization Agreement: Mexedia DAC. At or prior to the Closing, RDAR, Mexedia DAC (“Mexedia Ireland”) and the owner of Mexedia Ireland shall have entered into a Share Exchange Agreement, in the form of Exhibit B attached hereto (the “Mexedia Ireland SPA”), pursuant to which RDAR would acquire all of the outstanding shares of capital stock of Mexedia Ireland.
5.2Redemption Agreement. At or prior to the Closing, RDAR and JanBella Group, LLC shall have entered into a Redemption Agreement, in the form of Exhibit C attached hereto (the “Redemption Agreement”), pursuant to which RDAR would re-acquire all outstanding shares of Series E Preferred Stock of RDAR.
5.3Access to Information; Confidentiality.
(a)Acquired Company shall, and shall cause its officers, employees, counsel, financial advisors and other representatives to, afford to RDAR and its representatives reasonable access during normal business hours during the period prior to the Effective Time to its and to Acquired Company’s properties, books, contracts, commitments, personnel and records and, during such period, Acquired Company shall, and shall cause its officers, employees and representatives to, furnish promptly to RDAR all information concerning its business, properties, financial condition, operations and personnel as such other party may from time to time reasonably request. For the purposes of determining the accuracy of the representations and warranties of RDAR set forth herein and compliance by RDAR of its obligations hereunder, during the period prior to the Effective Time, RDAR shall provide Acquired Company and its representatives with reasonable access during normal business hours to its properties, books, contracts, commitments, personnel and records as may be necessary to enable Acquired Company to confirm the accuracy of the representations and warranties of RDAR set forth herein and compliance by RDAR of its obligations hereunder, and, during such period, RDAR shall, and shall cause its officers, employees and representatives to, furnish promptly to Acquired Company upon its request (1) a copy of each report, schedule, registration statement and other document filed by it during such period pursuant to the requirements of federal or state securities laws and (2) all other information concerning its business, properties, financial condition, operations and personnel as such other party may from time to time reasonably request.
Except as required by law, each of Acquired Company and RDAR will hold, and will cause its respective directors, officers, employees, accountants, counsel, financial advisors and other representatives and affiliates to hold, any nonpublic information in confidence.
(b)No investigation pursuant to this Section 5.3 shall affect any representations or warranties of the parties herein or the conditions to the obligations of the parties hereto.
5.4Best Efforts. Upon the terms and subject to the conditions set forth in this Agreement, each of the parties agrees to use its best efforts to take, or cause to be taken, all actions, and to do, or cause to be done, and to assist and cooperate with the other parties in doing, all things necessary, proper or advisable to consummate and make effective, in the most expeditious manner practicable, the Share Exchange and the other transactions contemplated by this Agreement. RDAR and Acquired Company shall mutually cooperate in order to facilitate the achievement of the benefits reasonably anticipated from the Share Exchange.
5.5Public Announcements. RDAR, on the one hand, and Acquired Company, on the other hand, will consult with each other before issuing, and provide each other the opportunity to review and comment upon, any press release or other public statements with respect to the transactions contemplated by this Agreement and shall not issue any such press release or make any such public statement prior to such consultation, except as may be required by applicable law or court process. The parties agree that the initial press release or releases to be issued with respect to the transactions contemplated by this Agreement shall be mutually agreed upon prior to the issuance thereof.
5.6Expenses. All costs and expenses incurred in connection with this Agreement and the transactions contemplated hereby shall be paid by the party incurring such expenses.
5.7No Solicitation. Except as previously agreed to in writing by the other party, neither Acquired Company nor RDAR shall authorize or permit any of its officers, directors, agents, representatives, or advisors to solicit, initiate or encourage or take any action to facilitate the submission of inquiries, proposals or offers from any person relating to any matter concerning any exchange, merger, consolidation, business combination, recapitalization or similar transaction involving Acquired Company or RDAR, respectively, other than the transaction contemplated by this Agreement or any other transaction the consummation of which would or could reasonably be expected to impede, interfere with, prevent or delay the Share Exchange or which would or could be expected to dilute the benefits to either Acquired Company or RDAR of the transactions contemplated hereby. Acquired Company or RDAR will immediately cease and cause to be terminated any existing activities, discussions and
negotiations with any parties conducted heretofore with respect to any of the foregoing.
Article VI.
Conditions Precedent and Conditions Subsequent
6.1Conditions to Each Party’s Obligation to Effect the Share Exchange. The obligation of each party to effect the Share Exchange and otherwise consummate the transactions contemplated by this Agreement is subject to the satisfaction, at or prior to the Closing, of each of the following conditions:
(a)No Restraints. No temporary restraining order, preliminary or permanent injunction or other order preventing the consummation of the Share Exchange shall have been issued by any court of competent jurisdiction or any other Governmental Entity having jurisdiction and shall remain in effect, and there shall not be any applicable legal requirement enacted, adopted or deemed applicable to the Share Exchange that makes consummation of the Share Exchange illegal.
(b)Governmental Approvals.
(1)As to RDAR and Acquired Company. All authorizations, consents, orders, declarations or approvals of, or filings with, or terminations or expirations of waiting periods imposed by, any governmental entity having jurisdiction which the failure to obtain, make or occur would have a material adverse effect on RDAR or Acquired Company shall have been obtained, made or occurred.
(2)As to the Owner. All required approvals required by local rules and regulations, stock market rules and regulations and corporate governance requirements, including the issuance of any and all required communications with respect thereto, as well as all other authorizations, consents, orders, declarations or approvals of, or filings with, or terminations or expirations of waiting periods imposed by, any governmental entity having jurisdiction which the failure to obtain, make or occur would have a material adverse effect on the Owner shall have been obtained, made or occurred.
(c)No Litigation. There shall not be pending or threatened any suit, action or proceeding before any court, Governmental Entity or authority (1) pertaining to the transactions contemplated by this Agreement or (2) seeking to prohibit or limit the ownership or operation by Acquired Company or RDAR, or to dispose of or hold separate any material portion of the business or assets of Acquired Company or RDAR.
6.2Conditions Precedent to Obligations of RDAR. The obligation of RDAR to effect the Share Exchange and otherwise consummate the transactions contemplated by this Agreement are subject to the satisfaction, at or prior to the Closing, of each of the following conditions:
(a)Representations, Warranties and Covenants. The representations and warranties of Acquired Company in this Agreement shall be true and correct in all material respects (except for such representations and warranties that are qualified by their terms by a reference to materiality or material adverse effect, which representations and warranties as so qualified shall be true and correct in all respects) both when made and on and as of the Closing Date, and Acquired Company shall have performed and complied in all material respects with all covenants, obligations and conditions of this Agreement required to be performed and complied with by each of them prior to the Effective Time.
(b)Consents. RDAR shall have received evidence, in form and substance reasonably satisfactory to it, that such licenses, permits, consents, approvals, authorizations, qualifications and orders of governmental authorities and other third parties as necessary in connection with the transactions contemplated hereby have been obtained.
(c)No Material Adverse Change. There shall not have occurred any change in the business, condition (financial or otherwise), results of operations or assets (including intangible assets) and properties of Acquired Company that, individually or in the aggregate, could reasonably be expected to have a material adverse effect on Acquired Company.
(d)Board Resolutions. RDAR shall have received resolutions duly adopted by Acquired Company’s board of directors approving the execution, delivery, and performance of the Agreement and the transactions contemplated by the Agreement.
(e)Other Approvals. RDAR shall have received from the Owner written confirmation of its having obtained any and all approvals relating to this Agreement as may be required by the securities laws of the French Republic, including the rules and regulations promulgated thereunder.
(f)Due Diligence Investigation. RDAR shall be reasonably satisfied with the results of its due diligence investigation of Acquired Company in its sole and absolute discretion.
6.3Conditions Precedent to Obligation of Acquired Company. The obligation of Acquired Company to effect the Share Exchange and otherwise consummate the transactions contemplated by this Agreement is subject to the satisfaction, at or prior to the Closing, of each of the following conditions:
(a)Representations, Warranties and Covenants. The representations and warranties of RDAR in this Agreement shall be true and correct in all material respects (except for such representations and warranties that are qualified by their terms by a reference to materiality or material adverse effect, which representations and warranties as so qualified shall be true and correct in all respects) both when made and on and as of the Closing Date, and RDAR shall have performed and complied in all material respects with all covenants, obligations and
conditions of this Agreement required to be performed and complied with by it prior to the Effective Time.
(b)Consents. Acquired Company shall have received evidence, in form and substance reasonably satisfactory to it, that such licenses, permits, consents, approvals, authorizations, qualifications and orders of governmental authorities and other third parties as necessary in connection with the transactions contemplated hereby have been obtained.
(c)No Material Adverse Change. There shall not have occurred any change in the business, condition (financial or otherwise), results of operations or assets (including intangible assets) and properties of RDAR that, individually or in the aggregate, could reasonably be expected to have a material adverse effect on RDAR.
(d)Board Resolutions. Acquired Company shall have received resolutions duly adopted by RDAR’s board of directors approving the execution, delivery and performance of the Agreement and the transactions contemplated by the Agreement.
(e)Other Approvals. Acquired Company shall have received from the Owner written confirmation of its having obtained any and all approvals relating to this Agreement as may be required by the securities laws of the French Republic, including the rules and regulations promulgated thereunder.
(f)Due Diligence Investigation. Acquired Company shall be reasonably satisfied with the results of its due diligence investigation of RDAR in its sole and absolute discretion.
6.4Conditions Subsequent.
(a)Regulation A Offering. Should RDAR fail to have filed an Offering Statement on Form 1-A pursuant to Regulation A of the Securities and Exchange Commission (the “Reg A Offering”), on or before the 20th day following the Closing, the Owner shall have the right, but not the obligation, to rescind this Agreement by written notice to RDAR.
(b)Regulation A Offering Proceeds. Should RDAR fail to have obtained the sum of $1,500,000 in proceeds from the Reg A Offering, on or before the date that is six (6) months from the date of the SEC’s qualification of the Reg A Offering, the Members shall have the right, but not the obligation, to rescind this Agreement by unanimous written notice to RDAR (the “Rescission Notice”). Upon RDAR’s receipt of the Rescission Notice, this Agreement shall, ipso facto, be rescinded and the Parties returned to their statuses quo ante.
(c)Divestiture. Should RDAR fail to have divested of its current operations, which divestiture shall include all debts, other than the trade payables of RDAR listed on Exhibit D attached hereto and incorporated herein, of RDAR as of the Closing Date, on or before December 31, 2024, the Owner shall have the right, but not the obligation, to rescind this Agreement by written notice to RDAR.
Article VII.
Closing
7.1RDAR shall make the following deliveries at the Closing. To consummate the transaction, RDAR shall, at the Closing, make the following deliveries:
(a)Executed Closing Certificate, in the form of Exhibit E attached hereto;
(b)Executed written consent of the Board of Directors or RDAR authorizing each of the Change-in-Control Agreement, including this Agreement, and the issuance of the Exchange Shares;
(c)A fully executed Mexedia Ireland SPA;
(d)A fully executed Redemption Agreement; and
(e)The Exchange Shares, in the form of the Exchange Shares Certificate.
7.2Acquired Company and the Owner shall make the following deliveries at the Closing. To consummate the transaction Acquired Company and the Owner shall, at Closing, make the following deliveries:
(a)Executed Closing Certificate, in the form of Exhibit F attached hereto;
(b)A fully executed Mexedia Ireland SPA; and
(c)The Ownership Interest, duly assigned to RDAR.
Article VIII.
Termination, Amendment and Waiver
8.1Termination. This Agreement may be terminated and abandoned at any time prior to the Effective Time of the Share Exchange:
(a)by mutual written consent of RDAR and Acquired Company;
(b)by either RDAR or Acquired Company if any Governmental Entity shall have issued an order, decree or ruling or taken any other action permanently enjoining, restraining or otherwise prohibiting the Share Exchange and such order, decree, ruling or other action shall have become final and non-appealable;
(c)by either RDAR or Acquired Company if the Share Exchange shall not have been consummated on or before January 31, 2025 (other than as a result of the failure of the party seeking to terminate this Agreement to perform its obligations under this Agreement required to be performed at or prior to the Effective Time).
(d)by RDAR, if a material adverse change shall have occurred relative to Acquired Company (and not curable within 10 days);
(e)by Acquired Company if a material adverse change shall have occurred relative to RDAR (and not curable within thirty 10 days);
(f)by RDAR, if Acquired Company willfully fails to perform in any material respect any of its material obligations under this Agreement; or
(g)by Acquired Company, if RDAR willfully fails to perform in any material respect any of its obligations under this Agreement.
8.2Effect of Termination. In the event of termination of this Agreement by either Acquired Company or RDAR as provided in Section 8.1, this Agreement shall forthwith become void and have no effect, without any liability or obligation on the part of RDAR or Acquired Company, other than the provisions of this Section 8.2. Nothing contained in this Section 8.2 shall relieve any party for any breach of the representations, warranties, covenants or agreements set forth in this Agreement.
8.3Amendment. This Agreement may not be amended except by an instrument in writing signed on behalf of each of the parties upon approval by the party, if such party is an individual, and upon approval of the Board of Director of RDAR and of Acquired Company.
8.4Extension; Waiver. Subject to Section 8.1(c), at any time prior to the Effective Time, the parties may (a) extend the time for the performance of any of the obligations or other acts of the other parties, (b) waive any inaccuracies in the representations and warranties contained in this Agreement or in any document delivered pursuant to this Agreement, or (c) waive compliance with any of the agreements or conditions contained in this Agreement. Any agreement on the part of a party to any such extension or waiver shall be valid only if set forth in an instrument in writing signed on behalf of such party. The failure of any party to this Agreement to assert any of its rights under this Agreement or otherwise shall not constitute a waiver of such rights.
8.5Return of Documents. In the event of termination of this Agreement for any reason, RDAR and Acquired Company will return to the other party all of the other party’s documents, work papers, and other materials (including copies) relating to the transactions contemplated in this Agreement, whether obtained before or after execution of this Agreement. RDAR and Acquired Company will not use any information so obtained from the other party for any purpose and will take all reasonable steps to have such other party’s information kept confidential.
Article IX.
Indemnification and Related Matters
9.1Survival of Representations and Warranties. The representations and warranties in this Agreement or in any instrument delivered pursuant to this Agreement, including any disclosure schedule, shall survive until twelve (12) months after the Effective Time (except for with respect to Taxes, which shall survive for the applicable statute of limitations plus 90 days, and covenants that by their terms survive for a longer period). The right to any remedy based upon such representations and warranties shall not be affected by any investigation conducted with respect to, or any knowledge acquired at any time, whether before or after execution and delivery of this Agreement or the Closing Date, with respect to the accuracy or inaccuracy of any such representation or warranty.
9.2Indemnification.
(a)RDAR shall indemnify and hold Acquired Company and Acquired Company’s officers and directors (“Acquired Company Representatives”) harmless for, from and against any and all liabilities, obligations, damages, losses, deficiencies, costs, penalties, interest and expenses (including, but not limited to, any and all expenses whatsoever reasonably incurred in investigating, preparing or defending against any litigation, commenced or threatened, or any claim whatsoever) (collectively, “Losses”) to which RDAR may become subject resulting from or arising out of any breach of a representation, warranty or covenant made by RDAR as set forth herein.
(b)Acquired Company shall indemnify and hold RDAR and RDAR’s officers and directors (“RDAR’s Representatives”) harmless for, from and against any and all Losses to which RDAR or RDAR’s Representatives may become subject resulting from or arising out of (1) any breach of a representation, warranty or covenant made by Acquired Company as set forth herein; or (2) any and all liabilities arising out of or in connection with: (A) any of the assets of Acquired Company prior to the Closing; or (B) the operations of Acquired Company prior to the Closing.
9.3Notice of Indemnification. Promptly after the receipt by any indemnified party (the “Indemnitee”) of notice of the
commencement of any action or proceeding against such Indemnitee, such Indemnitee shall, if a claim with respect thereto is or may be made against any indemnifying party (the “Indemnifying Party”) pursuant to this Article IX, give such Indemnifying Party written notice of the commencement of such action or proceeding and give such Indemnifying Party a copy of such claim and/or process and all legal pleadings in connection therewith. The failure to give such notice shall not relieve any Indemnifying Party of any of its indemnification obligations contained in this Article IX, except where, and solely to the extent that, such failure actually and materially prejudices the rights of such Indemnifying Party. Such Indemnifying Party shall have, upon request within thirty (30) days after receipt of such notice, but not in any event after the settlement or compromise of such claim, the right to defend, at its own expense and by its own counsel reasonably acceptable to the Indemnitee, any such matter involving the asserted liability of the Indemnitee; provided, however, that if the Indemnitee determines that there is a reasonable probability that a claim may materially and adversely affect it, other than solely as a result of money payments required to be reimbursed in full by such Indemnifying Party under this Article IX or if a conflict of interest exists between Indemnitee and the Indemnifying Party, the Indemnitee shall have the right to defend, compromise or settle such claim or suit; and, provided, further, that such settlement or compromise shall not, unless consented to in writing by such Indemnifying Party, which shall not be unreasonably withheld, be conclusive as to the liability of such Indemnifying Party to the Indemnitee. In any event, the Indemnitee, such Indemnifying Party and its counsel shall cooperate in the defense against, or compromise of, any such asserted liability, and in cases where the Indemnifying Party shall have assumed the defense, the Indemnitee shall have the right to participate in the defense of such asserted liability at the Indemnitee’s own expense. In the event that such Indemnifying Party shall decline to participate in or assume the defense of such action, prior to paying or settling any claim against which such Indemnifying Party is, or may be, obligated under this Article IX to indemnify an Indemnitee, the Indemnitee shall first supply such Indemnifying Party with a copy of a final court judgment or decree holding the Indemnitee liable on such claim or, failing such judgment or decree, the terms and conditions of the settlement or compromise of such claim. An Indemnitee’s failure to supply such final court judgment or decree or the terms and conditions of a settlement or compromise to such Indemnifying Party shall not relieve such Indemnifying Party of any of its indemnification obligations contained in this Article IX, except where, and solely to the extent that, such failure actually and materially prejudices the rights of such Indemnifying Party. If the Indemnifying Party is defending the claim as set forth above, the Indemnifying Party shall have the right to settle the claim only with the consent of the Indemnitee.
Article X.
General Provisions
10.1Notices. Any and all notices and other communications hereunder shall be in writing and shall be deemed duly given to the party to whom the same is so delivered, sent or mailed at addresses and contact information set forth below (or at such other address for a party as shall be specified by like notice.) Any and all notices or other communications or deliveries required or permitted to be provided hereunder shall be deemed given and effective on the earliest of: (a) on the date of transmission, if such notice or communication is delivered via e-mail at the e-mail address set forth on the signature pages attached hereto prior to 5:30 p.m. (Eastern Time) on a business day, (b) on the next business day after the date of transmission, if such notice or communication is delivered via facsimile at the facsimile number set forth on the signature pages attached hereto on a day that is not a business day or later than 5:30 p.m. (Eastern Time) on any business day, (c) on the second business day following the date of mailing, if sent by a nationally recognized overnight courier service, or (d) if by personal delivery, upon actual receipt by the party to whom such notice is required to be given.
If to RDAR prior to Closing:7950 East Redfield Road, Unit 210
Scottsdale, AZ 85260
If to Acquired Company:1680 Michigan Avenue, Suite 700
Miami Beach, Florida 33139
If to the Owner:Via di Affogalasino, 105 - 00148 Roma RM
10.2Definitions. For purposes of this Agreement:
(a)an “affiliate” of any person means another person that directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with, such first person;
(b)“material adverse change” or “material adverse effect” means, when used in connection with Acquired Company or RDAR, any change or effect that either individually or in the aggregate with all other such changes or effects is materially adverse to the business, assets, properties, condition (financial or otherwise) or results of operations of such party and its subsidiaries taken as a whole (after giving effect in the case of RDAR to the consummation of the Share Exchange);
(c)“person” means an individual, corporation, partnership, joint venture, association, trust, unincorporated organization or other entity; and
(d)a “subsidiary” of any person means another person, an amount of the voting securities, other voting ownership or voting partnership interests of which is sufficient to elect at least a majority of its board of Directors or other governing body (or, if there are no such voting interests, fifty percent (50%) or more of the equity interests of which) is owned directly or indirectly by such first person.
10.3Interpretation. When a reference is made in this Agreement to a Section, Exhibit or Schedule, such reference shall be to a Section of, or an Exhibit or Schedule to, this Agreement unless otherwise indicated. The headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement. Whenever the words “include”, “includes” or “including” are used in this Agreement, they shall be deemed to be followed by the words “without limitation.”
10.4Entire Agreement; No Third-Party Beneficiaries. This Agreement and the other agreements referred to herein constitute the entire agreement, and supersede all prior agreements and understandings, both written and oral, among the parties with respect to the subject matter of this Agreement. This Agreement is not intended to confer upon any person other than the parties any rights or remedies.
10.5Governing Law. This Agreement shall be governed by, and construed in accordance with, the laws of the State of Nevada, regardless of the laws that might otherwise govern under applicable principles of conflicts of laws thereof.
10.6Assignment. Neither this Agreement nor any of the rights, interests or obligations under this Agreement shall be assigned, in whole or in part, by operation of law or otherwise by any of the parties without the prior written consent of the other parties. Subject to the preceding sentence, this Agreement will be binding upon, inure to the benefit of, and be enforceable by, the parties and their respective successors and assigns.
10.7Enforcement. The parties agree that irreparable damage would occur in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached. It is accordingly agreed that the parties shall be entitled to an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions of this Agreement in any court of the United States located in the State of Nevada, this being in addition to any other remedy to which they are entitled at law or in equity. In addition, each of the parties hereto (a) agrees that it will not attempt to deny or defeat such personal jurisdiction or venue by motion or other request for leave from any such court, and (b) agrees that it will not bring any action relating to this Agreement or any of the transactions contemplated by this Agreement in any state court other than such court.
10.8Severability. Whenever possible, each provision or portion of any provision of this Agreement will be interpreted in such manner as to be effective and valid under applicable law but if any provision or portion of any provision of this Agreement is held to be invalid, illegal or unenforceable in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability will not affect any other provision or portion of any provision in such jurisdiction, and this Agreement will be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision or portion of any provision had never been contained herein.
10.9Counterparts. This Agreement may be executed simultaneously in two or more counterparts, any one of which need not contain the signatures of more than one party, but all such counterparts taken together will constitute one and the same Agreement. This Agreement, to the extent delivered by means of a facsimile machine or electronic mail (any such delivery, an “ Electronic Delivery “), shall be treated in all manner and respects as an original agreement or instrument and shall be considered to have the same binding legal effect as if it were the original signed version thereof delivered in person. At the request of any party hereto, each other party hereto shall re-execute original forms hereof and deliver them in person to all other parties. No party hereto shall raise the use of Electronic Delivery to deliver a signature or the fact that any signature or agreement or instrument was transmitted or communicated through the use of Electronic Delivery as a defense to the formation of a contract, and each such party forever waives any such defense, except to the extent such defense related to lack of authenticity.
10.10Attorneys’ Fees. In the event any suit or other legal proceeding is brought for the enforcement of any of the provisions of this Agreement, the parties hereto agree that the prevailing party or parties shall be entitled to recover from the other party or parties upon final judgment on the merits reasonable attorneys’ fees, including attorneys’ fees for any appeal, and costs incurred in bringing such suit or proceeding.
IN WITNESS WHEREOF, the undersigned have caused their duly authorized officers to execute this Agreement as of the date first above written.
RDAR:ACQUIRED COMPANY:
RAADR, INC.MEXEDIA INC.
EXEMPLAREXEMPLAR
By: __________________________By: __________________________
Jacob DiMartinoOrlando Taddeo
Chief Executive OfficerPresident
E-Mail: jacob.d@raadr.comE-Mail: otaddeo@mexedia.com
OWNER:
MEXEDIA S.p.A. S.B.
EXEMPLAR
By: __________________________
Orlando Taddeo
President
E-Mail: otaddeo@mexedia.com
EXHIBIT C
Form of Redemption Agreement
REDEMPTION AGREEMENT
This Agreement (the “Agreement”) is made as of September ___, 2024, by and between Raadr, Inc., a Nevada corporation (the “Issuer”), and JanBella Group, LLC, a stockholder of the Issuer (“Seller”).
RECITALS
WHEREAS, Seller is the owner of 1,000,000 shares of the Issuer’s Series E Preferred Stock, par value $0.001 per share (“Subject Preferred Stock”); and
WHEREAS, Seller desires to sell to the Issuer, and the Issuer desires to re-purchase and redeem from Seller, the Subject Preferred Stock, which shall result in the re-purchase and redemption by the Issuer of the Subject Preferred Stock, on and subject to the terms of this Agreement.
NOW, THEREFORE, the parties hereto hereby agree as follows:
1.Sale of the Shares. Subject to the terms and conditions of this Agreement, and in reliance upon the representations, warranties, covenants and agreements contained in this Agreement, Seller shall sell to the Issuer the Subject Preferred Stock, and the Issuer shall re-purchase and redeem the Subject Preferred Stock from Seller, for the purchase price set forth in Exhibit A attached hereto and incorporated herein by this reference (the “Purchase Price”).
2.Right to Rescind. If the Acquisition Agreements (defined below) are rescinded in accordance with their respective terms or if the Issuer defaults on the Redemption Note (as defined in Exhibit A), then Seller shall have the right, but not the obligation, to rescind this Agreement by written notice to the Issuer. Should Seller so rescind this Agreement, the Issuer shall, without delay, re-issue the Subject Preferred Stock to Seller and Seller shall retain any and all amounts paid to Seller under the Redemption Note (as defined in Exhibit A) as liquidated damages.
3.Condition Precedent. As a condition precedent to the Closing (defined below) of this Agreement, Seller and Mexedia S.p.A. S.B., as guarantor of the Note, of the Note, shall have entered into a pledge agreement (the “Pledge Agreement”), in the form of Exhibit B attached hereto, and a guaranty (the “Guaranty”), in the form of Exhibit C attached hereto. The Pledge Agreement and the Guaranty are to become binding agreement upon the consummation of the Acquisition Agreements.
4.Closing.
(a)The purchase and sale of the Subject Preferred Stock shall take place at a closing (the “Closing”), to occur immediately following the effectiveness of the acquisition transactions (the “Acquisitions”) contemplated by those certain share exchange agreements, dated as of September ___, 2024, by and between (1) the Issuer, Mexedia, Inc. and its shareholder and (2) the Issuer, Mexedia DAC an its shareholder (collectively, the “Acquisition Agreements”). The parties hereto shall have no obligation to complete the Closing in the event all of the Acquisition Agreements are not consummated contemporaneously.
(b)At the Closing:
(1)Seller shall deliver to the Issuer book-entry statements representing the shares of Subject Preferred Stock, duly endorsed in form for transfer to the Issuer.
(2)The Issuer shall have delivered a fully executed Pledge Agreement and a fully executed Guaranty.
(3)The Issuer shall pay to Seller the Purchase Price, as set forth in Exhibit A.
(4)At, and at any time after, the Closing, Seller shall duly execute, acknowledge and deliver all such further assignments, conveyances, instruments and documents, and shall take such other action consistent with the terms of this Agreement to carry out the transactions contemplated by this Agreement, as may be requested by the Issuer.
5.Representations and Warranties.
(a)Of Seller. Seller makes the following representations and warranties to the Issuer with respect to Seller and the Subject Preferred Stock to be sold by Seller hereunder:
(1)Seller is domiciled in the United States of America.
(2)Seller is an “accredited investor” as such term is defined in Rule 501(a) of Regulation D promulgated under the Securities Act of 1933, as amended (the “Securities Act”).
(3)Seller has the requisite power and authority to enter into this Agreement and to consummate the transactions contemplated hereby and otherwise to carry out its obligations hereunder.
(4)Seller owns the Subject Preferred Stock free and clear of any and all options, liens, claims, encumbrances, security interests, pledges, preemptive rights, rights of first refusal and adverse interests of any kind. Seller agrees that the consideration payable by the Issuer for the re-purchase and redemption of the Subject Preferred Stock is fair and reasonable and that Seller is in the best position to evaluate and determine the fair value of the Subject Preferred Stock. There are no restrictions on the transfer or redemption of the Subject Preferred Stock (other than restrictions under the Securities Act or state securities laws). No person or entity has any right to purchase the Subject Preferred Stock or any portion thereof or interest therein.
(5)Seller has received and reviewed the Acquisition Agreements and understands and consents to the transactions contemplated thereby. Seller has been afforded the opportunity during the course of negotiating the transactions contemplated by this Agreement to ask questions of, and to secure such information from, the Issuer and its officers and directors with regard to each of the Issuer and Mexedia S.p.A. S.B., the owner of Mexedia, Inc. and Mexedia DAC, as it deems necessary to evaluate the merits of consenting to the Issuer’s consummating such transactions, it being understood that Seller is the controlling stockholder of the Issuer and, as such, is intimately familiar with the Issuer and its business, operations, assets, liabilities, prospects and financial condition in all respects. All such questions, if asked, were answered satisfactorily and all information or documents provided were found to be satisfactory.
(6)There is no private or governmental action, suit, proceeding, claim, arbitration or investigation pending before any agency, court or tribunal, foreign or domestic, or, to Seller’s knowledge, threatened against Seller or any of its properties. There is no judgment, decree or order against Seller that could prevent, enjoin, alter or delay any of the transactions contemplated by this Agreement.
(7)No bankruptcy, receivership or debtor relief proceedings are pending or, to Seller’s knowledge, threatened against Seller.
(8)All representations, covenants and warranties of Seller contained in this Agreement shall be true and correct on and as of the Closing Date with the same effect as though the same had been made on and as of such date.
(b)Of the Issuer. The Issuer makes the following representations and warranties to Seller:
(1)The Board of Directors has authorized the Issuer’s entering into this Agreement and consummating the transactions contemplated hereby and otherwise to carry out its obligations hereunder.
(2)The Issuer is in good standing in the State of Nevada and in every other jurisdiction in which it engages in business.
(3)There is no private or governmental action, suit, proceeding, claim, arbitration or investigation pending before any agency, court or tribunal, foreign or domestic, or, to the Issuer’s knowledge, threatened against the Issuer or any of its properties. There is no judgment, decree or order against the Issuer that could prevent, enjoin, alter or delay any of the transactions contemplated by this Agreement.
(4)No bankruptcy, receivership or debtor relief proceedings are pending or, to the Issuer’s knowledge, threatened against the Issuer.
(5)All representations, covenants and warranties of the Issuer contained in this Agreement shall be true and correct on and as of the Closing Date with the same effect as though the same had been made on and as of such date.
6.Termination by Mutual Agreement. This Agreement may be terminated at any time by mutual consent of the parties hereto, provided that such consent to terminate is in writing and is signed by each of the parties hereto.
7.Release. Seller, on its own behalf and, to the extent of its legal authority, on behalf of its successors, assigns, heirs, next-of-kin, representatives, administrators, executors, partners, agents and affiliates, and any other person claiming by, through or under any of the foregoing (individually, a “Releasing Party”, and, collectively, “Releasing Parties”), hereby unconditionally and irrevocably releases, waives and forever discharges, effective as of the Closing hereunder, the Issuer, Phone Match, LLC, including its members, Mexedia, Inc., including its shareholder, and Mexedia DAC, including its shareholder, and each of their past and present respective officers, directors, employees, stockholders, predecessors, successors, assigns, partners, subsidiaries and affiliates (individually, a “Released Party”, and, collectively, “Released Parties”) from any and all claims, obligations, contracts, agreements, rights, debts, covenants and liabilities (including attorneys’ fees and costs) of any nature whatsoever, whether fixed or contingent, known or unknown, suspected or claimed to exist or unsuspected, regardless of whether knowledge of the unknown or unsuspected claim would have materially affected Seller’s decision to enter into this Agreement, both at law and in equity, arising directly or indirectly from any act, omission, event, or transaction occurring (or any facts or circumstances existing) on or prior to the Closing hereunder, but excluding claims for breach by the Issuer of any provision of this Agreement.
8.Miscellaneous.
(a)Entire Agreement. This Agreement constitutes the entire agreement of the parties, superseding and terminating any and all prior or contemporaneous oral and written agreements, understandings or letters of intent between or among the parties, with respect to the subject matter of this Agreement. No part of this Agreement may be modified or amended, nor may any right be waived, except by a written instrument which expressly refers to this Agreement, states that it is a modification or amendment of this Agreement and is signed by the parties to this Agreement, or, in the case of waiver, by the party granting the waiver. No course of conduct or dealing or trade usage or custom and no course of performance shall be relied on or referred to by any party to contradict, explain or supplement any provision of this Agreement, it being acknowledged by the parties to this Agreement that this Agreement is intended to be, and is, the complete and exclusive statement of the agreement with respect to its subject matter. Any waiver shall be limited to the express terms thereof and shall not be construed as a waiver of any other provisions or the same provisions at any other time or under any other circumstances.
(b)Severability. If any section, term or provision of this Agreement shall to any extent be held or determined to be invalid or unenforceable, the remaining sections, terms and provisions shall nevertheless continue in full force and effect.
(c)Notices. All notices provided for in this Agreement shall be in writing signed by the party giving such notice, and delivered personally or sent by overnight courier, mail or messenger against receipt thereof or sent by registered or certified mail, return receipt requested, or by facsimile transmission or similar means of communication if receipt is confirmed or if transmission of such notice is confirmed by mail as provided in this Section 6(c). Notices shall be deemed to have been received on the date of personal delivery or e-email or attempted delivery. Notice shall be delivered to the parties at the following addresses:
If to the Issuer:7950 East Redfield Road, Unit 210, Scottsdale, Arizona 85260.
If to Seller:20311 Chartwell Center Drive, Suite 1469, Cornelius, North Carolina 28031.
Either party may, by like notice, change the address, person or telecopier number to which notice shall be sent.
(d)Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of North Carolina without regard to principles of conflicts of laws. Any action brought by either party against the other concerning the transactions contemplated by this Agreement shall be brought only in the state courts of North Carolina or in the federal courts located in the state and City of Charlotte, North Carolina. The parties to this Agreement hereby irrevocably waive any objection to jurisdiction and venue of any action instituted hereunder and shall not assert any defense based on lack of jurisdiction or venue or based upon forum non conveniens. The Issuer and the Seller waive trial by jury. The prevailing party shall be entitled to recover from the other party its reasonable attorney’s fees and costs. In the event that any provision of this Agreement or any other agreement 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 any agreement. Each party hereby irrevocably waives personal service of process and consents to process being served in any suit, action or proceeding in connection with this Agreement, any agreement or any other document delivered in connection with this Agreement by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by law.
(e)Successors. This Agreement shall be binding upon the parties and their respective heirs, executors, administrators, legal representatives, successors and assigns; provided, however, that neither party may assign this Agreement or any of its rights under this Agreement without the prior written consent of the other party.
(f)Further Assurances. Each party to this Agreement agrees, without cost or expense to any other party, to deliver or cause to be delivered such other documents and instruments as may be reasonably requested by any other party to this Agreement in order to carry out more fully the provisions of, and to consummate the transaction contemplated by, this Agreement.
(g)Counterparts. This Agreement may be executed simultaneously in two or more counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument. This Agreement and any documents relating to it may be executed and transmitted to any other party by facsimile or email of a PDF, which facsimile or PDF shall be deemed to be, and utilized in all respects as, an original, wet-inked document.
(h)No Strict Construction. The language used in this Agreement will be deemed to be the language chosen by the parties with the advice of counsel to express their mutual intent, and no rules of strict construction will be applied against any party.
(i)Headings. The headings in the Sections of this Agreement are inserted for convenience only and shall not constitute a part of this Agreement.
[ SIGNATURE PAGE FOLLOWS ]
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the date first above written.
ISSUER:SELLER:
RAADR, INC.JANBELLA GROUP, LLC
EXEMPLAREXEMPLAR
By: _______________________By: _______________________
Jacob DiMartinoWilliam Alessi
Chief Executive Officer
Managing Member
EXHIBIT A
Purchase Price of Subject Preferred Stock
Due to the difficulty in establishing a value for the businesses to be acquired by the Issuer in the Acquisitions, the Issuer and Seller have agreed to a minimum Purchase Price of $540,000.00 (the “Minimum Price”) and a maximum Purchase Price of $1,800,000.00 (the “Maximum Price”) for the Subject Preferred Stock. The Purchase Price shall be paid by the Issuer’s delivery of a secured promissory note (the “Redemption Note”), in the form of Annex I attached to this Exhibit A.
ANNEX I
Form of Redemption Note
NEITHER THE ISSUANCE NOR THE SALE OF THE SECURITIES REPRESENTED HEREBY 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 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, IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT.
SECURED PROMISSORY NOTE
Principal Amount: $540,000.00Issue Date: September ___, 2024
Raadr, Inc., a Nevada corporation (“Maker”), promises to pay to JanBella Group, LLC (“Holder”) the principal sum of Five Hundred Forty Thousand Dollars ($540,000.00) (the “Principal Balance”), together with interest accrued thereon calculated at the rate of eight percent (8%) per annum (the “Interest”), all as set forth herein (the “Note”).
The Principal Balance and accrued Interest shall be due and payable, as follows:
(A)within three (3) business days from the end of each calendar month during which Maker shall have received proceeds (each a “Monthly Reg A Tranche”) under Maker’s next-filed Offering Statement on Form 1-A (the “Regulation A Offering”), Maker shall pay Holder an amount that equals forty percent (40%) of each Monthly Reg A Tranche amount that exceeds $100,000, with each such payment being applied first to accrued Interest and then to the Principal Balance of this Note, until such time as all accrued Interest and the Principal Balance shall have been paid in full; and
(B)in any event, on or before September __, 2025 (the “Maturity Date”).
Following the date of payment in full of the Principal Balance and all accrued Interest thereon (the “Balance Date”), Maker further promises to pay to Holder up to an additional $1,260,000 as additional principal (the “Additional Principal”). In this regard, within three (3) business days from Maker’s receipt of a Monthly Reg A Tranche after the Balance Date, Maker shall pay Holder an amount that equals ten percent (10%) of each Monthly Reg A Tranche amount that exceeds $100,000, until such time as all of the Additional Principal has been paid. Further, and in addition to the provisions of the foregoing sentence, for a period of 18 months immediately following the Issue Date, within three (3) business days from Maker's receipt of any third-party funding (the "Sourced Funding"), whether in the from of debt and/or equity, Maker shall pay Holder an amount that equals ten percent (10%) of the Sourced Funding amount, until such time as all of the Additional Principal has been paid. Maker shall incur no penalty for its failing to pay the Addition Principal amount in full.
Upon a default by Maker hereunder, the then-outstanding Principal Balance shall thereafter bear interest thereon at eighteen percent (18%) per annum (the “Default Rate”) until the past due amount, including interest at the Default Rate, shall have been paid in full.
In the event any payment called for by this Note would result in the violation of applicable usury laws, then any amount paid in excess of the maximum amount on interest allowed by law shall be applied towards a reduction of the outstanding principal balance.
The obligations of this Note are secured by (a) that certain Pledge Agreement dated as of the Issue Date among Holder, as lender, and Heritage Ventures Ltd., Gianluca Benedetti and Adama GmbH, as guarantors, and (b) that certain Guaranty dated as of the Issue Date among Holder, as lender, and Heritage Ventures Ltd., Gianluca Benedetti and Adama GmbH, as guarantors.
The occurrence of any one or more of the following events shall constitute a default under this Note:
(a)failure of Maker to file the Regulation A Offering within twenty (20) days from the Issue Date of this Note;
(b)failure of Maker to make any payment when due under this Note, with a grace period of two (2) business days;
(c)the filing of any petition under federal bankruptcy law or any similar federal or state statute by or against Maker;
(d)an application for the appointment of a receiver for, the making of a general assignment for the benefit of creditors by, or the insolvency of Maker;
(e)the validity or enforceability of this Note is contested by Maker; or
(f)Maker denies that it has any or any further liability or obligation hereunder.
This Note is and shall be deemed to have been made and delivered in the State of North Carolina and in all respects shall be governed and construed in accordance with the laws of that State.
This Note shall be governed by and construed in accordance with the laws of the State of North Carolina without regard to principles of conflicts of laws. Any action brought by either party against the other concerning the transactions contemplated by this Note shall be brought only in the state courts of North Carolina or in the federal courts located in the City of Charlotte, State of North Carolina. The parties to this Note hereby irrevocably waive any objection to jurisdiction and venue of any action instituted hereunder and shall not assert any defense based on lack of jurisdiction or venue or based upon forum non conveniens. The Borrower and Holder waive trial by jury. The prevailing party shall be entitled to recover from the other party its reasonable attorney’s fees and costs. In the event that any provision of this Note or any other agreement 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 any agreement. Each party hereby irrevocably waives personal service of process and consents to process being served in any suit, action or proceeding in connection with this Note, any agreement or any other document delivered in connection with this Note by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Note and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by law.
The word “Maker” shall include Maker’s representatives, successors and assigns and the word “Holder” shall include Holder’s representatives, successors and assigns.
Maker and all endorsers of this Note hereby waive presentment for payment, demand for payment, notice of non-payment and dishonor, protest, and notice of protest; consent to any renewals, extensions and partial payments of this Note or the indebtedness for which it is given without notice to them, and consent that no such renewals, extensions or partial payments shall discharge any party hereto from liability hereon in whole or in part.
If this Note shall be placed with an attorney for collection, Maker, endorsers and guarantors agree to pay all costs of collection, including reasonable attorneys’ fees which shall be added to the amount due under this Note and shall be recoverable with the amount due under this Note and shall be a lien on any collateral securing this Note.
Maker acknowledges and agrees that sufficient consideration has passed to render this Note valid and enforceable and waives any claim based on inadequate consideration.
IN WITNESS WHEREOF, Maker has executed this Note as of the date first above set forth.
RAADR, INC.
EXEMPLAR
By: ___________________________
Jacob DiMartino
Chief Executive Officer
EXHIBIT B
Form of Pledge Agreement
PLEDGE AGREEMENT
This Pledge Agreement (the “Agreement”) is made and entered as of September ___, 2024, by and among Mexedia S.p.A. S.B. (“Guarantor”), JanBella Group, LLC, a North Carolina limited liability company (“Lender”), and the undersigned holder of the pledged shares (“Pledge Holder”).
RECITALS
Raadr, Inc., a Nevada corporation (the “Company”), issued a Secured Promissory Note, dated as of the date of this Agreement (the “Redemption Note”) to Lender, whereby the Company owes payment obligations to Lender.
Guarantor has agreed to secure the Company’s payment obligations to Lender under the Redemption Note with a guaranty and a pledge of, and thereby create a security interest in favor of Lender in, a total of 75,000 shares of Series F Preferred Stock of the Company (the “Shares”), the Shares representing 100% of the issued and outstanding shares of Series F Preferred Stock of the Company.
AGREEMENT
1.Security Interest. Guarantor hereby grants to Lender a security interest in (a) the Shares, (b) all Dividends (as defined below), and (c) all Additional Securities (as defined below); to secure payment of the Redemption Note and performance of all Guarantor’s obligations under this Agreement. For purposes of this Agreement, the Shares, all Dividends and all Additional Securities will be collectively referred to as the “Collateral”. If any stock dividend, reclassification, readjustment, stock split or other change is declared or made with respect to the Collateral, or if warrants or any other rights, options or securities are issued in respect of the Collateral (“Additional Securities”), then all new, substituted and/or additional shares or other securities issued by reason of such change or by reason of the exercise of such warrants, rights, options or securities, will be (if delivered to Guarantor, immediately surrendered to Lender care of the Pledge Holder and) pledged to Lender to be held under the terms of this Agreement as and in the same manner as the Collateral is held hereunder.
2.Appointment of the Pledge Holder. Guarantor and Lender hereby designate and appoint the Pledge Holder as such for the purposes hereinafter set forth. Guarantor hereby deposits with the Pledge Holder (a) the Shares, as are represented by the book entry statement in the name of Guarantor, (b) the original Stock Power, copies of which are attached hereto as Exhibit A, and (c) documentation waiving the Medallion Signature Guaranty requirement signed by the Company and Manhattan Transfer Registrar Co., in form satisfactory to Lender.
3.Rights and Obligations of the Pledge Holder.
(a)Guarantor and Lender hereby authorize the Pledge Holder to keep and preserve the Shares in its possession pending payment in full of the Redemption Note. If a default occurs under the terms of this Agreement or the Redemption Note, then Lender shall provide written notice to Guarantor and the Company specifying the default and shall, subject to Section 3(b) hereof, have the right to direct the Pledge Holder to transfer the Shares to the Lender or its designee if Guarantor and/or the Company has not cured the default within 15 days after receipt of the notice. In such event, the Pledge Holder, acting as agent of Lender, shall, with respect to the Shares, exercise the rights and duties of a Secured Party under the Uniform Commercial Code as enacted in Nevada (the “UCC”), and under any other applicable law as the same may, from time to time, be in effect. Guarantor agrees that any notice by Pledge Holder concerning the sale, disposition or other intended action in connection with the Shares, whether required by the UCC, or otherwise shall constitute reasonable notice to Guarantor if such notice is mailed by registered mail or certified mail, return receipt requested, postage prepaid at least ten days prior to such action.
(b)Notwithstanding anything contained herein to the contrary, in no event shall the Lender, or any affiliate of the Lender, be entitled to exercise incidents of ownership over, own, or convert any portion of the Shares in excess of that portion of Shares that upon conversion of which the sum of: (1) the number of shares of common stock of the Company (the “Common Stock”) beneficially owned by the Lender and its affiliates (other than shares of Common Stock which may be deemed beneficially owned through the ownership of the unconverted portion of any securities of the Company or the unexercised or unconverted portion of any other security of the Company subject to a limitation on conversion or exercise analogous to the limitations contained herein) and (2) the number of shares of Common Stock issuable upon the conversion of the portion of the Shares with respect to which the determination of this proviso is being made, would result in beneficial ownership by the Lender and its affiliates of more than 9.99% of the outstanding shares of Common Stock. For purposes of the proviso to the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and Regulations 13D-G thereunder, except as otherwise provided in clause (1) of such proviso, provided, however, that the limitations set forth in this Section 3(b) may be waived by the Lender only upon, at the election of the Lender, not less than 61 days’ prior notice to the Company and the Pledge Holder, and the provisions of the conversion limitation shall continue to apply until such 61st day (or such later date, as determined by the Lender, as may be specified in such notice of waiver).
4.Disposition of Shares. Upon any disposition of the Shares by Pledge Holder in accordance with the terms of Section 3 (Rights and Obligations of the Pledge Holder), Lender shall be entitled to all of the proceeds of any such disposition.
5.Rights of Beneficial Ownership. Upon an event of default under the Redemption Note, and subject to Section 3(b), Lender shall be deemed the beneficial owner of the Shares and shall have all rights and benefits incident thereto. Lender and Guarantors, and each of them, agree to execute any necessary proxies or other documents to effectuate this right. So long as Guarantor owns the Shares and no event of default has occurred under the Redemption Note, Guarantor shall be entitled to vote any shares comprising the Collateral, subject to any proxies granted by Guarantor.
6.Covenants of Guarantor. Guarantor hereby represents and warrants to Lender that Guarantor has good title (both record and beneficial) to the Collateral, free and clear of all claims, pledges, security interests, liens or encumbrances of every nature whatsoever, and that Guarantor has the right to pledge and grant Lender the security interest in the Collateral granted under this Agreement. Guarantor agrees that, until all sums due under the Redemption Note have been paid in full, Guarantor will not: (a) sell, assign or transfer, or attempt to sell, assign or transfer, any of the Collateral, (b) grant or create, or attempt to grant or create, any security interest, lien, pledge, claim or other encumbrance with respect to any of the Collateral, (c) suffer or permit to continue upon any of the Collateral during the term of this Agreement, an attachment, levy, execution or statutory lien, (d) permit the issuance of any equity of the Company or any other security of the Company which diminishes the value, or rights and preferences of the Shares or otherwise make any change to its capitalization; or (e) amend the rights and preferences of the Shares.
There shall be no substitution of collateral under the terms of this Agreement, without the prior written consent of Lender.
Guarantor hereby agrees to indemnify Lender and Pledge Holder against any direct loss, reasonable cost or out-of-pocket expense incurred by holder in connection with the Redemption Note and Agreement and the exercise of any and all rights pertaining thereto, including, without limitation, all court costs, reasonable attorney’s fees and other costs of collection.
7.Disputes. In the event of a dispute with respect to the terms and provisions of this Agreement, Pledge Holder shall not be required to resolve that dispute or take any action with respect thereto. Pledge Holder may continue to hold the Shares and await final resolution of the dispute by joint written instructions from Guarantor and Lender or by a final determination of a court or arbitration panel of competent jurisdiction. In the alternative, Pledge Holder may deliver the Shares to a court of proper jurisdiction under an appropriate action in interpleader and thereupon be relieved of all responsibility under this Agreement.
8.Release of Shares. When satisfactory proof has been presented to Pledge Holder that all amounts due under the Redemption Note (including accrued interest thereon) have been paid, Pledge Holder shall deliver the Shares with stock power attached to Guarantor and all obligations by and among Guarantor, Lender and Pledge Holder under this Agreement shall thereupon cease.
9.Conduct of Pledge Holder. Pledge Holder shall not be required to exercise any standard of care greater than ordinary care in discharging its duties and obligations under this Agreement and Pledge Holder shall not incur any liability to anyone for any damages, losses or expenses with respect to any action taken or omitted in good faith. Pledge Holder shall have no duties other than those expressly imposed herein. Pledge Holder may rely and shall be protected in relying upon any paper or other document that may be submitted to it in connection with its duties hereunder and that it believes to be genuine and to have been signed or presented by the proper party or parties and shall have no liability or responsibility with respect to the form, execution or validity thereof. Pledge Holder may resign as
such following the giving of 30 days prior written notice to the other parties hereto. Similarly, Pledge Holder may be removed and replaced following the giving of 30-days’ prior written notice to Pledge Holder by the other parties hereto. In either event, the duties of Pledge Holder shall terminate 30 days after receipt of such notice (or as of such earlier date as may be mutually agreeable), and Pledge Holder shall then deliver the Shares and any other related materials then in its possession to a successor pledge holder as shall be appointed by the other parties hereto as evidenced by a written notice filed with Pledge Holder. If the other parties hereto have failed to appoint a successor prior to the expiration of 30 days following receipt of the notice of resignation or removal, Pledge Holder may appoint a successor or petition any court of competent jurisdiction for the appointment of a successor pledge holder or for other appropriate relief, and any such resulting appointment shall be binding upon all of the parties hereto.
10.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 (a) personally served, (b) deposited in the mail, registered or certified, return receipt requested, postage prepaid, (c) delivered by reputable air courier service with charges prepaid, or (d) transmitted by hand delivery, telegram, e-mail or facsimile, addressed as set forth below or to such other address as such party shall have specified most recently by written notice. Any notice or other communication required or permitted to be given hereunder shall be deemed effective (1) upon hand delivery or delivery by e-mail or facsimile, with accurate confirmation generated by the transmitting facsimile machine, at the address or number 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) or (2) on the second business day following the date of mailing by express courier service, fully prepaid, addressed to such address, or upon actual receipt of such mailing, whichever shall first occur. The addresses for such communications shall be:
If to Lender:JanBella Group, LLC, Attention: William Alessi
20311 Chartwell Center Drive, Suite 1469, Cornelius, NC 28031
E-mail: balessi@alphamodus.com
If to Guarantor:Attention: Orlando Taddeo
Via di Affogalasino, 105 - 00148 Roma RM
E-mail: otaddeo@mexedia.com
If to Pledge Holder:Newlan Law Firm, PLLC, Attention: Eric Newlan
2201 Long Prairie Road, Suite 107-762, Flower Mound, Texas 75022
E-mail: eric@newlanpllc.com
11.Wavier. No delay or omission by Lender in exercising any right or remedy hereunder shall operate as a waiver thereof or of any right or remedy, and no single or partial exercise thereof shall preclude any other or further exercise thereof or the exercise of any other right or remedy. All rights and remedies of Lender hereunder are cumulative.
12.General. No modification, rescission, waiver, release or amendment of any provision of this Agreement shall be made except by written agreement subscribed by Guarantor and Lender. An executed original of any such agreement shall be delivered to the Pledge Holder upon its execution and if such agreement affects the right, duties or obligations of the Pledge Holder under this Agreement, it must also be executed and agreed to by the Pledge Holder before the same shall have any legal effect. This Agreement shall be governed under the laws of the State of North Carolina without regard to conflict of law principles; and any action with respect to this Agreement shall be bought in the State of North Carolina, County of Mecklenburg. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Except as required by law, each party to this Agreement shall keep this Agreement, the Redemption Note and the transactions contemplated by these agreements strictly confidential.
IN WITNESS WHEREOF, the parties have executed and delivered this Pledge Agreement on the date first set forth above.
GUARANTOR:
MEXEDIA S.p.A. S.B.
EXEMPLAR
By: __________________________
Orlando Taddeo
President
| LENDER:
JANBELLA GROUP, LLC
EXEMPLAR
By: ________________________
William Alessi
Managing Member
PLEDGE HOLDER:
NEWLAN LAW FIRM, PLLC
EXEMPLAR
By: _________________________
Eric Newlan
Managing Member
|
ACKNOWLEDGED AND AGREED BY THE COMPANY:
RAADR, INC.
EXEMPLAR
By: ______________________________
Jacob DiMartino
Chief Executive Officer
EXHIBIT C
Form of Guaranty
GUARANTY
This Guaranty, dated as of September ___, 2024, is made by and between Mexedia S.p.A. S.B. (“Guarantor”), and JanBella Group, LLC, a North Carolina limited liability company (“Lender”).
RECITALS
On September ___, 2024, Raadr, Inc., a Nevada corporation (“Borrower”), issued a Secured Promissory Note (the “Redemption Note”) in the principal amount of $540,000.00. A material element of the Redemption Note is, among others, the delivery of a pledge agreement (the “Pledge Agreement”) dated the date hereof by and among Guarantor, Borrower and Lender, whereby Guarantor pledged a total of 75,000 shares of Series F Preferred Stock of the Company (the “Pledged Securities”), to secure the performance when due of all obligations of Borrower pursuant to the Note and this Guaranty.
NOW, THEREFORE, in consideration of the premises and in order to induce Lender to consummate the transactions contemplated by the Agreement, Guarantor hereby agrees as follows:
1.Guaranty. Guarantor hereby unconditionally and irrevocably guarantees the full and prompt performance when due of all obligations of Borrower under the Note (the “Obligations”).
2.Guaranty Absolute. Guarantors, and each of them, guarantee that the Obligations will be performed strictly in accordance with their terms, regardless of any law, regulation or order now or hereafter in effect in any jurisdiction affecting any of such terms or the rights of Lender with respect thereto; and if such Obligations are not performed accordingly, Guarantor hereby unconditionally and irrevocably guarantees the full and prompt performance when due of all Obligations (including, but not limited to, payment). The liability of Guarantor is primary, direct and independent of the obligations of Borrower pursuant to the Note. This Guaranty shall be enforceable against Guarantor in the same manner as if Guarantor were the primary obligor. The liability of Guarantor under this Guaranty shall be absolute and unconditional irrespective of:
(a)any change in the time, manner or place of payment of, or in any other term of, all or any of the Obligations, or any other amendment or waiver of or any consent to departure thereof;
(b)any defense which Guarantor may assert including, but not limited to, failure of consideration, breach of warranty, fraud, payment, statute of frauds, bankruptcy, lack of legal capacity, statute of limitations, lender liability, accord and satisfaction and usury; or
(c)any other circumstance which might otherwise constitute a defense available to, or a discharge
of, Guarantor.
None of the foregoing waivers shall prejudice Lender’s rights under the Note. This Guaranty shall continue to be effective or be reinstated, as the case may be, if at any time any payment of any of the Obligations is rescinded or must otherwise be returned by Lender upon the insolvency, bankruptcy or reorganization of Borrower or otherwise, all as though such payment had not been made.
Notwithstanding any of the foregoing provisions of this Section 2 to the contrary, should Guarantor deliver the Pledged Securities to Lender in accordance with the terms of the Pledge Agreement upon Borrower’s failure to fully and promptly perform its Obligations under the Note, then Guarantor’s guaranty hereunder shall be deemed to be fully satisfied and Guarantor shall have no further liability to Lender hereunder.
3.Matters Being Waived. Guarantor hereby waives promptness, diligence, notice of acceptance, and any other notice with respect to any of the obligations of the Note and this Guaranty and any requirement that Lender exhausts any right or take any action against Borrower or any other person or entity or any collateral.
4.Governing Law. This Guaranty shall be governed by and construed in accordance with the laws of the State of North Carolina without regard to principles of conflicts of laws. Any action brought by either party against the other concerning the transactions contemplated by this Guaranty shall be brought only in the state courts of North Carolina or in the federal courts located in the state and City of Charlotte, North Carolina. The parties to this Guaranty hereby irrevocably waive any objection to jurisdiction and venue of any action instituted hereunder and shall not assert any defense based on lack of jurisdiction or venue or based upon forum non conveniens. Guarantor waives trial by jury. The prevailing party shall be entitled to recover from the other party its reasonable attorney’s fees and costs. In the event that any provision of this Guaranty or any other agreement 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 any agreement. Each party hereby irrevocably waives personal service of process and consents to process being served in any suit, action or proceeding in connection with this Guaranty, any agreement or any other document delivered in connection with this Guaranty by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Guaranty and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by law.
5.Miscellaneous Provisions.
(a)Amendments. No amendment or waiver of any provision of this Guaranty nor consent to any departure by Guarantors therefrom shall in any event be effective unless the same shall be in writing and signed by Lender and then such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given.
(b)No Waiver; Remedies. No failure on the part of Lender to exercise, and no delay in exercising, any right hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right hereunder preclude any other or further exercise thereof or the exercise of any other right. The remedies herein provided are cumulative and not exclusive of any remedies provided by law.
(c)Headings. The headings herein are for convenience only and shall not limit or define the meaning of the provisions of this Guaranty.
(d)Severability. If any provision of this Guaranty for any reason shall be held to be illegal,
invalid or unenforceable, such illegality shall not affect any other provision of this Guaranty, this Guaranty shall be amended so as to enforce the illegal, invalid or unenforceable provision to the maximum extent permitted by applicable law, and the parties shall cooperate in good faith to further modify this Guaranty so as to preserve to the maximum extent possible the intended benefits to be received by the parties.
(e)Continuing Guaranty. This Guaranty is a continuing guaranty and shall (1) remain in full force and effect until payment in full of the obligations of the Note and all other amounts payable under this Guaranty, (2) be binding upon Guarantors, and each of them, their respective successors and respective assigns, and (3) inure to the benefit of and be enforceable by Lender and its successors, transferees and assigns.
IN WITNESS WHEREOF, Guarantors have duly executed, or caused to be duly executed, and delivered this Guaranty as of the date first above written.
GUARANTOR:
MEXEDIA S.p.A. S.B.
EXEMPLAR
By: __________________________
Orlando Taddeo
President
EXHIBIT D
Trade Payables of RDAR
To remain RDAR obligations:
Michael Handelman (CPA)$6,000.00
Manhattan Transfer Registrar Co.$6,005.00
To be assigned by RDAR to new subsidiary post-closing:
Cooperative Computing (App developer)$30,000.00
EXHIBIT E
Form of Closing Certificate of RDAR
CERTIFICATE OF THE COMPANY
[Pursuant to Section 7.1(a) of the Share Exchange Agreement]
The undersigned, Jacob DiMartino, the duly elected and acting Chief Executive Officer of Raadr, Inc., a Nevada corporation (the “Company”), hereby certifies and affirms that each of the following is true and correct:
1.The representations and warranties of the Company contained in that certain Share Exchange Agreement (the “Exchange Agreement”) to which this Certificate relates are true and correct in all material respects on the date of this Certificate and, except for those representations and warranties which address matters only as of a particular date, with the same force and effect as if made as of this date.
2.The Company is a corporation duly organized and existing under the laws of the State of Nevada, and has the power and authority to own its properties and carry on its business in the manner in which such business is conducted.
3.The execution, delivery and performance by the Company of the Exchange Agreement, in accordance with the terms and provisions of the Exchange Agreement, have been duly authorized by appropriate corporate action of the Company.
4.The Company has full power, right and authority to enter into the Exchange Agreement and to perform their respective obligations under the Exchange Agreement, and the Exchange Agreement is the legal, valid and binding obligation of the Company and is enforceable against the Company in accordance with its terms.
5.The Exchange Shares of the Company to be issued pursuant to the Exchange Agreement will be, upon issuance and delivery pursuant to the terms of the Exchange Agreement, validly issued, fully paid and non-assessable.
Certified and affirmed this ____ day of September, 2024.
RAADR, INC.
EXEMPLAR
By: __________________________
Jacob DiMartino
Chief Executive Officer
EXHIBIT F
Form of Closing Certificate of Acquired Company and the Owner
CERTIFICATE OF ACQUIRED COMPANY AND THE Owner
[Pursuant to Section 7.2(a) of the Share Exchange Agreement]
The undersigned hereby certify and affirm that each of the following is true and correct:
1.The representations and warranties of Mexedia DAC, a Republic of Ireland corporation (the “Acquired Company”), in that certain Share Exchange Agreement (the “Exchange Agreement”) to which this Certificate relates are true and correct in all material respects on the date of this Certificate and, except for those representations and warranties which address matters only as of a particular date, with the same force and effect as if made as of this date.
2.Acquired Company is a corporation duly organized and existing under the laws of the Republic of Ireland, and has the corporate power and authority to own its properties and carry on its business in the manner in which such business is conducted.
3.The execution, delivery and performance by Acquired Company of the Exchange Agreement, in accordance with its terms and provisions, have been duly authorized by appropriate corporate action of Acquired Company.
4.Acquired Company has full power, right and authority to enter into the Exchange Agreement and to perform its obligations under the Exchange Agreement and the Exchange Agreement is the legal, valid and binding obligation of Acquired Company and is enforceable against Acquired Company in accordance with its terms.
5.The Ownership Interest of Acquired Company that is the subject to the Exchange Agreement is fully paid and non-assessable and, when transferred and sold on the Closing Date of the Exchange Agreement, will be free and clear of any liens, claims and encumbrances.
6.Acquired Company and the Owner have each performed or complied with, in all material respects, all agreements and covenants required of them by the Exchange Agreement to which this Certificate relates.
Certified and affirmed this ____ day of September, 2024.
| OWNER:
MEXEDIA S.p.A. S.B.
EXEMPLAR
By: __________________________
Orlando Taddeo
President
| ACQUIRED COMPANY:
MEXEDIA DAC
EXEMPLAR
By: __________________________
Orlando Taddeo
President
|
AMENDMENT NO. 1
TO
SHARE EXCHANGE AGREEMENT
This constitutes Amendment No. 1 to that certain Share Exchange Agreement (the “Agreement”) dated as of September 9, 2024, by and among Raadr, Inc., a Nevada corporation (“RDAR”), Mexedia DAC, a Republic of Ireland corporation (“Acquired Company”), and Mexedia S.p.A. S.B., the owner of Acquired Company (the “Owner”).
For good and adequate consideration, the receipt and adequacy of which is hereby acknowledged, RDAR, Acquired Company and Owner agree, as follows:
A.Section 1.2 of the Agreement is hereby deleted in its entirety and replaced with the following:
1.2Closing. Unless this Agreement shall have been terminated and the transactions herein contemplated shall have been abandoned pursuant to Article VIII, the closing date of the Exchange (the “Closing”) will take place on the business day upon satisfaction of the conditions set forth in Article VI (or as soon as practicable thereafter following satisfaction or waiver of the conditions set forth in Article VI) (the “Closing Date”), at such time and location as may be agreed upon by RDAR and Acquired Company; provided, however, that the Closing shall take place no later than February 28, 2025.
B.Section 8.(c) of the Agreement is hereby deleted in its entirety and replaced with the following:
(c)by either RDAR or Acquired Company if the Share Exchange shall not have been consummated on or before February 28, 2025 (other than as a result of the failure of the party seeking to terminate this Agreement to perform its obligations under this Agreement required to be performed at or prior to the Effective Time).
In all other aspects, the Agreement is ratified and affirmed as of the 28th day of September, 2024.
[ SIGNATURE PAGE FOLLOWS ]
MEXEDIA DAC AMENDMENT NO. 1 TO SHARE EXCHANGE AGREEMENT | PAGE 1
[ SIGNATURE PAGE TO AMENDMENT NO. 1 TO SHARE EXCHANGE AGREEMENT ]
IN WITNESS WHEREOF, the undersigned have caused their duly authorized officers to execute this Amendment No. 1 to Share Exchange Agreement as of the date first above written.
RDAR:ACQUIRED COMPANY:
RAADR, INC.MEXEDIA DAC
By: /s/ Jacob DiMartinoBy: /s/ Orlando Taddeo
Jacob DiMartinoOrlando Taddeo
Chief Executive OfficerPresident
E-Mail: jacob.d@raadr.comE-Mail: otaddeo@mexedia.com
OWNER:
MEXEDIA S.p.A. S.B.
By: /s/ Orlando DiMartino
Orlando Taddeo
President
E-Mail: otaddeo@mexedia.com
MEXEDIA DAC AMENDMENT NO. 1 TO SHARE EXCHANGE AGREEMENT | PAGE 2
NEWLAN LAW FIRM, PLLC
2201 Long Prairie Road – Suite 107-762
Flower Mound, Texas 75022
940-367-6154
November 29, 2024
Telvantis, Inc.
(formerly Raadr, Inc.)
1680 Michigan Avenue, Suite 700
Miami Beach, Florida 33139
Re:Offering Statement on Form 1-A
Gentlemen:
We have been requested by Telvantis, Inc., formerly Raadr, Inc., a Nevada corporation (the “Company”), to furnish you with our opinion as to the matters hereinafter set forth in connection with its offering statement on Form 1-A (the “Offering Statement”) relating to the qualification of shares of the Company’s common stock under Regulation A promulgated under the Securities Act of 1933, as amended. Specifically, this opinion relates to 1,500,000,000 shares of the Company’s $0.001 par value common stock (the “Company Shares”).
In connection with this opinion, we have examined the Offering Statement, the Company’s Articles of Incorporation and Bylaws (each as amended to date), copies of the records of corporate proceedings of the Company and such other documents as we have deemed necessary to enable us to render the opinion hereinafter expressed.
For purposes of this opinion, we have assumed the authenticity of all documents submitted to us as originals, the conformity to the originals of all documents submitted to us as copies and the authenticity of the originals of all documents submitted to us as copies. We have also assumed the legal capacity of all natural persons, the genuineness of the signatures of persons signing all documents in connection with which this opinion is rendered, the authority of such persons signing on behalf of the parties thereto other than the Company and the due authorization, execution and delivery of all documents by the parties thereto other than the Company. We have not independently established or verified any facts relevant to the opinions expressed herein, but have relied upon statements and representations of officers and other representatives of the Company and others.
Based upon and subject to the foregoing qualifications, assumptions and limitations and the further limitations set forth below, we are of the opinion that the 1,500,000,000 Company Shares being offered by the Company will, when issued in accordance with the terms set forth in the Offering Statement, be legally issued, fully paid and non-assessable shares of common stock of the Company.
Our opinion expressed above is subject to the qualification that we express no opinion as to the applicability of, compliance with, or effect of any laws except the Nevada Revised Statutes (including the statutory provisions and reported judicial decisions interpreting the foregoing).
We hereby consent to the use of this opinion as an exhibit to the Offering Statement and to the reference to our name under the caption “Legal Matters” in the Offering Statement and in the offering circular included in the Offering Statement. We confirm that, as of the date hereof, we own no shares of the Company’s common stock, nor any other securities of the Company.
Sincerely,
/s/ Newlan Law Firm, PLLC
NEWLAN LAW FIRM, PLLC