Item 1.01 Entry into a Material Definitive Agreement





Sale of Assets

On December 10, 2019, we entered into an Asset Purchase Agreement (the "Purchase Agreement") with NoNoDerma, LLC (the "Buyer") pursuant to which the Company agreed to sell and transfer to Buyer all or substantially all of the Company's assets (the "Asset Sale"). In connection with the execution of the Purchase Agreement, on December 10, 2019, shareholders holding a majority of the Company's voting power, acting by written consent in lieu of a meeting, consented to the Asset Sale. The Board of Directors of the Company also approved the Asset Sale acting by written consent in lieu of a meeting on December 10, 2019. The closing of the Asset Sale occurred on the same day as the execution of the Purchase Agreement.

The aggregate purchase price for the Asset Sale is equal to the sum of:

(i) A Promissory Note from Buyer in the amount of $600,000, bearing interest at 7%, fully amortizing over 36 monthly payments, secured by a blanket security interest in the assets of Buyer, subordinate to Buyer's existing senior secured lender, and guaranteed by LeoGroup Private Investment Access, LLC, the parent of Buyer.

(ii) 7.5% ownership of Buyer.

(iii) Cancellation of existing senior secured debt from the Company to LeoGroup Private Investment Access, LLC in the remaining amount of $400,000.

(iv) Cancellation of existing royalty obligation of the Company to LeoGroup Private Investment Access, LLC in the remaining amount of $1,400,000.

The Purchase Agreement provides that the Buyer will not assume nor have any responsibility for, any liability of the Company.

As a result of the Asset Sale, the Company will have conveyed substantially all of its assets. The Company will retain the ownership interest it is being issued in the Buyer.

The Purchase Agreement contains customary representations, warranties and covenants by each of the Company and Buyer as well customary indemnification provisions among the parties.

Item 2.01 Completion of Acquisition or Disposition of Assets

Reference is made to the disclosure set forth under Item 1.01 of this report, which disclosure is incorporated herein by reference.


                                       1

© Edgar Online, source Glimpses