This
Settlement Agreement (the “Agreement”) is made and
entered into by and among Adam Kasower (“Kasower”), East Ventures,
Inc., a British Virgin Islands company (“East Ventures”), SV Booth
Investments III, LLC, a Delaware limited liability company
("SC Booth") and
Theorem Group, LLC, a California limited liability company
("Theorem Group")
(collectively, Kasower, East Ventures, SV Booth and Theorem Group
are referred to herein as "Claimants"), and GT Biopharma
Inc. (“GT
Biopharma”). GT Biopharma and Claimants are each
referred to as a “Party” and, collectively,
as the “Parties.”
WHEREAS, from on or about October 1,
2009 and through 2017, Claimants Theorem Group, East Ventures, SV
Booth, and Kasower each invested in GT Biopharma and its
predecessor, formerly known as Oxis International, Inc., through a
Securities Purchase Agreement (the “SPA”) pursuant to which
Claimants purchased from GT Biopharma convertible warrants and
preferred stock (the "Securities");
WHEREAS, Claimants allege that on August
27, 2017, GT Biopharma completed a restructuring of its
unregistered debt and equity securities (the
“Restructuring”), wherein debtholders of GT Biopharma
received one share of GT Biopharma’s $0.001 par value common
stock (“Common Stock”) for each one dollar and twenty
cents ($1.20) of principal and accrued interest owed to them by GT
Biopharma; warrant holders exercised their warrants on a cashless
basis into one share of Common Stock for each warrant held; and
preferred stock holders exchanged their preferred stock pursuant to
a preferred stock exchange agreement;
WHEREAS, Claimants allege that on August
27, 2017, pursuant to the Restructuring, certain holders of
securities of GT Biopharma were issued a total of 1,513,548 shares
of newly issued GT Biopharma’s $0.001 par value series J
preferred stock (the “Series J Preferred”). The Series
J Preferred was to convert one to one (1:1) into the Common Stock
from time to time as converted by the holders. The Series J was
subsequently reported on GT Biopharma’s filings with the
Securities and Exchange Commission
(“SEC”);
WHEREAS, Claimants allege that
on January 29, 2019 GT Biopharma
notified certain investors that it had issued new series J-1
preferred shares (the “Series J-1 Preferred”) to
replace the unconverted balance of Series J Preferred and that the
Series J-1 Preferred was materially different from the Series J
Preferred allegedly allowing the holders to receive a most favored
nations treatment on conversion based on GT Biopharma’s
ongoing financing;
WHEREAS, Claimants allege that the
subsequent exchange of the Series J Preferred to the Series J-1
Preferred and the additional issuances of Series J-1 Preferred were
material breaches of the Restructuring and allegedly causing
Claimants substantial damage and harm in the form of
dilution;
WHEREAS, a dispute arose between GT
Biopharma and Claimants regarding GT Biopharma’s obligations
under the terms of the SPA and the Securities issued thereunder and
GT Biopharma disputes Claimants' allegations;
WHEREAS, on November 26, 2019, Claimants
caused their counsel to send a letter to GT Biopharma, alleging, in
part, that Claimants had "suffered damages in the aggregate of more
than $5,000,000" (the "Demand Letter") and enclosing a draft
complaint (the "Draft Complaint");
WHEREAS, the Parties previously engaged
in settlement discussions, including the preparation of
preliminary, draft settlement documents, which did not receive
approval from, and were expressly rejected by, the GT Biopharma
Board;
WHEREAS, the Parties desire to fully
settle and resolve all issues, disputes, claims and causes of
action that were raised, or that could have been raised, relating
in every and any way to the Demand Letter and/or the Draft
Complaint, to avoid further expense and inconvenience of
litigation, without any admission of liability or wrongdoing on the
part of GT Biopharma, its officers, agents or
shareholders;
WHEREAS, GT Biopharma denies each and
every one of Claimants' allegations of wrongful conduct, and denies
that any conduct challenged by Claimants caused any damage
whatsoever, and have asserted a number of defenses to Claimants'
claims;
WHEREAS, the Parties agree that this
Agreement shall not be deemed or construed to be an admission or
evidence of any violation of any statute or law or of any liability
or wrongdoing by GT Biopharma, its officers, agents or
shareholders, or of the truth of any claim or allegation or a
waiver of any defenses thereto;
AND WHEREAS, the Parties, each acting on
his, her or its own behalf, have approved of the settlement terms
described below.
NOW, THEREFORE, for good and valuable
consideration, the receipt and sufficiency of which is hereby
acknowledged, including in return for the promises and covenants
undertaken by the Parties herein and the releases given herein, the
Parties agree as follows:
1. Settlement Exchange: Within
five (5) Business Days of the date on which this Agreement is fully
executed by the Parties, GT Biopharma shall issue and deliver to
each of Claimants a convertible note (the “Settlement Notes”), in
the form attached hereto as Exhibit A, in the following
amounts:
The
date on which the Settlement Notes are delivered to Claimants is
hereinafter referred to as the “Exchange Date.” As used
herein, “Business
Day” means any day other than a Saturday, Sunday or
other day on which commercial banks in the City of New York are
authorized or required to remain closed.
2. Releases
and Covenant Not to Sue:
a. Claimants' Releases: Claimants
on their own behalf, and for and on behalf of theirs parent
companies, subsidiaries, and direct or indirect affiliates, and any
and all of their respective present, former, and future general
partners, limited partners, officers, directors, shareholders,
managers, members, trustees, employees, consultants, attorneys, and
other agents in their respective capacities as such, and the heirs,
executors, administrators, successors, and assigns of each of them
(collectively, the “Claimants' Releasors”),
hereby completely and irrevocably releases and forever and finally
discharges any and all Claims (as defined below), rights, demands,
obligations, causes of action, counterclaims, defenses, rights of
setoff, rights of rescission, liens, disputes, damages,
liabilities, debts, costs, expenses (including attorneys’
fees), payments, capital contributions, fees, bonds, covenants,
contracts, agreements, judgments, charges, or losses of any kind or
character whatsoever, in law or equity, whether presently known or
unknown, asserted or unasserted, fixed or contingent, in contract,
tort, or otherwise, that any of the Claimants' Releasors had,
presently may have or may have in the future against GT Biopharma,
as well as, to the extent applicable, each of their respective
parent companies, subsidiaries, direct and indirect affiliates, and
any and all of their respective present, former and future
officers, directors, shareholders, managers, members, partners,
employees, consultants, attorneys, and other agents in their
respective capacities as such (collectively, the
“GT Biopharma and
Individual Released Parties”), arising out of or by
reason of any cause, matter, or thing relating or ancillary to the
Demand Letter or Draft Complaint. The release shall apply to Claims
whether arising under any statute, rule or regulation, or under the
law of any country, state, province, territory, or any other
jurisdiction, or under principles of contract law, common law, or
equity; provided that, and consistent with Section 3(f) of this
Agreement, nothing herein shall release Claims arising out of this
Agreement or any Settlement Documents (as defined
below).
b. GT Biopharma’s Releases.
GT Biopharma on its own behalf, and for and on behalf of its parent
companies, subsidiaries, and direct or indirect affiliates, and any
and all of their respective present, former, and future general
partners, limited partners, officers, directors, shareholders,
managers, members, trustees, employees, consultants, attorneys, and
other agents in their respective capacities as such, and the heirs,
executors, administrators, successors, and assigns of each of them
(collectively, the “GT Biopharma Releasors”),
hereby completely and irrevocably releases and forever and finally
discharges any and all Claims, rights, demands, obligations, causes
of action, counterclaims, defenses, rights of setoff, rights of
rescission, liens, disputes, damages, liabilities, debts, costs,
expenses (including attorneys’ fees), payments, capital
contributions, fees, bonds, covenants, contracts, agreements,
judgments, charges, or losses of any kind or character whatsoever,
in law or equity, whether presently known or unknown, asserted or
unasserted, fixed or contingent, in contract, tort, or otherwise,
that any of the GT Biopharma Releasors had, presently may have or
may have in the future against Claimants, as well as each of
Claimants' investment managers, subsidiaries, and direct or
indirect affiliates, and any and all of their respective direct or
indirect present, former and future officers, directors,
shareholders, managers, members, partners, employees, consultants,
attorneys, and other agents in their respective capacities as such
(collectively, the “Claimants Released
Parties”), arising out of or by reason of any cause,
matter, or thing relating or ancillary to the Demand Letter or the
Draft Complaint. The releases shall apply to Claims whether arising
under any statute, rule or regulation, or under the law of any
country, state, province, territory, or any other jurisdiction, or
under principles of contract law, common law, or equity; provided
that, consistent with Section 2(e) of this Agreement, nothing in
this release shall release Claims arising out of this Agreement or
any Settlement Documents. For the avoidance of doubt, the release
in this Section 2(b) shall have the same effect as a dismissal with
prejudice.
c. Covenant Not to Sue; Defense:
Except as necessary to enforce this Agreement and the Settlement
Documents, each Party on its own behalf and on behalf of any other
Person purporting to act by, through or on behalf of such Party,
hereby covenants, represents, and warrants that it will forever
refrain from suing to enforce or to recover, directly or
indirectly, under any Claims released by this Agreement, to the
extent such releases become effective. This Agreement may be
pleaded as a full and complete defense to, and may be used as the
basis for an injunction against any action, suit or other
proceeding which may be instituted, prosecuted or attempted in
breach of the undertakings contained here. As used herein,
“Person” means an
individual, a limited liability company, a partnership, a joint
venture, a corporation, a trust, an unincorporated organization,
any other entity and any government or any department or agency
thereof.
d. Unknown Claims: The Parties
each acknowledge that he, she or it may discover facts in addition
to or different from those that he, she or it now knows or believes
to be true with respect to the matters released herein, but that it
is the express intention of the Parties, except as necessary to
enforce this Agreement and the Settlement Documents, to fully,
finally and forever settle and release any and all claims released
hereby, known or unknown, suspected or unsuspected, which now
exists, heretofore existed, or may hereafter exist, and without
regard to the subsequent discovery or existence of such additional
or different facts with respect to the matters released hereby. In
furtherance of this intention, the Parties each acknowledge that
they have been advised of and expressly waive any and all
provisions, rights and benefits of California Civil Code Section
1542, which provides:
A
GENERAL RELEASE DOES NOT EXTEND TO CLAIMS THAT THE CREDITOR OR
RELEASING PARTY DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER
FAVOR AT THE TIME OF EXECUTING THE RELEASE, AND THAT, IF KNOWN BY
HIM OR HER, WOULD HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT
WITH THE DEBTOR OR RELEASED PARTY.
The
Parties shall also be deemed expressly to have waived any and all
provisions, rights and benefits conferred by any law of any state
or territory of the United States, or principle of common law,
which is similar, comparable, or equivalent to California Civil
Code Section 1542 or that would otherwise limit the releases and
waivers contained in this Agreement.
The
Parties each acknowledge that the foregoing waiver was separately
bargained for and is an integral aspect of the Agreement of which
this release is a part.
e. Enforcement of This Agreement:
For the avoidance of doubt, notwithstanding the foregoing or any
other provisions of this Agreement, the releases and covenants not
to sue in this Section 2 shall not apply to any disputes or claims
that may arise in the future relating to the enforcement of the
terms of this Agreement or the Settlement Documents issued pursuant
thereto.
3. No Admission: It is understood
and agreed that this Agreement is a compromise and settlement of
the Claims released herein, and it shall not be construed as an
admission, concession, or indication of the validity of any Claim,
defense, liability, obligation, or wrongdoing.
4. Representations and Covenants of GT
Biopharma:
a. Authorization; Enforcement;
Validity. GT Biopharma has the requisite corporate power and
authority to enter into and perform its obligations under this
Agreement, the Settlement Notes and each of the other agreements,
instruments, certificates or documents entered into by the parties
hereto in connection with the transactions contemplated by this
Agreement (collectively, the “Settlement Documents”)
and to issue the Settlement Notes, all in accordance with the terms
hereof and thereof. The execution and delivery of this Agreement
and the other Settlement Documents by GT Biopharma and the
consummation by GT Biopharma of the transactions contemplated
hereby and thereby, including, without limitation, the issuance of
the Settlement Notes, have been duly authorized by GT
Biopharma’s Board of Directors, and no further filing,
consent, or authorization is required by GT Biopharma, its Board of
Directors or its stockholders. This Agreement and the other
Settlement Documents are duly executed and delivered (or will be
delivered) by GT Biopharma, and constitute (or will constitute) the
legal, valid and binding obligations of GT Biopharma, enforceable
against GT Biopharma in accordance with their respective terms,
except as such enforceability may be limited by general principles
of equity or applicable bankruptcy, insolvency, reorganization,
moratorium, liquidation or similar laws relating to, or affecting
generally, the enforcement of applicable creditors’ rights
and remedies.
b. Issuance of Securities. In each
case subject to the terms of the Settlement Documents, the issuance
of the Settlement Notes are duly authorized and, upon issuance in
accordance with the terms hereof, shall be validly issued, fully
paid and free from all preemptive or similar rights, taxes, liens
and charges and other encumbrances with respect to the issue
thereof and the shares of Common Stock issuable upon conversion
thereof (“Conversion Shares”) (when issued) shall be
validly issued, fully paid and non-assessable and free from all
preemptive or similar rights, taxes, liens, charges and other
encumbrances with respect to the issue thereof, with the holder of
the Conversion Shares (when issued) being entitled to all rights
accorded to a holder of Common Stock. As of the Exchange Date, a
number of shares of Common Stock shall have been duly authorized
and reserved for issuance which equals or exceeds (the
“Required Reserved
Amount”) the sum of 150% of the maximum number of
Conversion Shares of Common Stock issuable pursuant to the terms of
the Settlement Note based on the initial Conversion Price (as
defined in the Settlement Note) (without taking into account any
limitations on the issuance thereof pursuant to the terms of the
Settlement Note). As of the date hereof, there are 672,834,264
shares of Common Stock authorized and unissued. So long as
Claimants holds the Settlement Note, GT Biopharma shall take use
commercially reasonable efforts to at all times have authorized,
and reserved for the purpose of issuance, no less than the Required
Reserve Amount.
c. No Conflicts. The execution,
delivery and performance of the Settlement Documents by GT
Biopharma and the consummation by GT Biopharma of the transactions
contemplated hereby and thereby (including, without limitation, the
issuance of the Settlement Notes) will not (i) result in a
violation of the restated certificate of incorporation of GT
Biopharma or its bylaws or (ii) result in a violation of any law,
rule, regulation, order, judgment or decree applicable to GT
Biopharma or any of its Subsidiaries, or by which any property or
asset of GT Biopharma or any of its Subsidiaries is bound or
affected, except, in the case of clauses (iii) above, where such
conflict, violation or default would not result, individually or in
the aggregate, in a Material Adverse Effect. For purposes of this
Agreement, “Material
Adverse Effect” means any material adverse effect on
the business, properties, assets, liabilities, operations, results
of operations or condition (financial or otherwise) of GT Biopharma
and its Subsidiaries, taken as a whole, or on the transactions
contemplated hereby or on the other Settlement Documents or by the
agreements and instruments to be entered into in connection
herewith or therewith, or on the authority or ability of GT
Biopharma to perform any of its obligations under any of the
Settlement Documents.
d. Consents. GT Biopharma is not
required to obtain any consent, authorization or order of, or make
any filing or registration with, any court, governmental agency or
any regulatory or self-regulatory agency or any other Person in
order for it to execute, deliver or perform any of its obligations
under or contemplated by the Settlement Documents, in each case in
accordance with the terms hereof or thereof, other than (i) the
filings required pursuant to Section 5(h) of this Agreement, (ii)
the notice and/or application(s), if any, required to be delivered
pursuant to Section 5(i) of this Agreement, (iii) any filings
required to be made under applicable state securities laws and
(iii) those already obtained or effected on or prior to the date
hereof.
e. FAST
Compliance. While any of the Settlement Notes are
outstanding, GT Biopharma shall maintain a transfer agent that
participates in the DTC Fast Automated Securities Transfer
Program.
f. Shell
Company Status. GT
Biopharma is not, and has never been,
an issuer identified in Rule 144(i)(1) of the U.S. Securities Act
of 1933, as amended (the “Act”).
g. SEC Filings. As of their
respective filing dates, GT Biopharma’s filings with the
United States Securities and Exchange Commission (the
“SEC”)
under the Securities Exchange Act of 1934, as amended (the
“Exchange
Act”) since January 1, 2019 (the “SEC Documents”), complied
in all material respects with the requirements of the Exchange Act
and the rules and regulations of the SEC promulgated thereunder
applicable to the SEC Documents, and none of the SEC Documents, at
the time they were filed with the SEC, contained any untrue
statement of a material fact or omitted to state a material fact
required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which
they were made, not misleading.
h. Disclosure of Transactions and Other
Material Information. GT Biopharma shall file a
current report on Form 8-K reasonably acceptable to Claimants (the
“8-K
Filing”) on or before 8:30 a.m., New York City time,
on the first Business Day after this Agreement has been duly
executed and delivered, in the form required by the 1934 Act,
relating to the transactions contemplated by this Agreement and
attaching a form of this Agreement and the form of Settlement Notes
(including, without limitation, all schedules and exhibits to such
agreements to the extent required by the rules of the SEC) as an
exhibit to such filing. From and after the filing of the 8-K
Filing with the SEC, Claimants shall not be in possession of any
material, nonpublic information received from GT Biopharma, any of
its Subsidiaries or any of their respective officers, directors,
employees or agents that is not disclosed in the 8-K Filing. In
addition, effective upon the filing of the 8-K Filing, GT Biopharma
acknowledges and agrees that any and all confidentiality or similar
obligations under any agreement, whether written or oral, between
GT Biopharma, any of its Subsidiaries or any of their respective
officers, directors, employees or agents, on the one hand, and
Claimants or any of their respective affiliates, on the other hand,
shall terminate and be of no further force or effect. GT Biopharma
shall not, and shall cause each of its Subsidiaries and its and
each of their respective officers, directors, employees and agents,
not to, provide Claimants with any material, nonpublic information
regarding GT Biopharma or any of its Subsidiaries from and after
the date hereof without the express prior written consent of
Claimants or as otherwise contemplated hereby. GT Biopharma
understands and confirms that Claimants will rely on the foregoing
representations in effecting transactions in securities of GT
Biopharma.
i. Listing. GT Biopharma
shall, if applicable, take all steps necessary to promptly secure
the listing or quotation of all of (i) Conversion Shares without
regard to any limitation on the conversion of the Settlement Note
and (ii) any capital stock of GT Biopharma issued or issuable with
respect to the Conversion Shares, as applicable, as a result of any
stock split, stock dividend, recapitalization, exchange or similar
event or otherwise (the “Listed Securities”) upon
the OTCQB (the “Principal Market”) or any
other national securities exchange or automated quotation system,
if any, upon which the Common Stock is then listed. GT
Biopharma shall pay all fees and expenses in connection with
satisfying its obligations under this Section 5(i).
j. No
Integration Actions. None of GT Biopharma, any of its
affiliates or any Person acting on behalf of GT Biopharma or such
affiliate will sell, offer for sale or solicit offers to buy in
respect of any security (as defined in the 1933 Act) that would be
integrated with the issuance of the Settlement Notes in a manner
that would require the registration under the 1933 Act of the
issuance to Claimants or require shareholder approval under the
rules and regulations of the Principal Market, and GT Biopharma
will take all action that is appropriate or necessary to assure
that its offerings of other securities will not be integrated for
purposes of the 1933 Act or the rules and regulations of the
Principal Market with the issuance of the Settlement Notes
contemplated hereby.
k. Variable Securities. For so
long as any of the Settlement Notes remain outstanding, GT
Biopharma shall not, in any manner, (i) issue or sell any rights,
warrants or options to subscribe for or purchase Common Stock or
directly or indirectly convertible into or exchangeable or
exercisable for Common Stock at a price which varies with the
market price of the Common Stock, including by way of one or more
reset(s) to any fixed price, unless the conversion, exchange or
exercise price of any such security cannot be less than the then
applicable Conversion Price with respect to the Common Stock into
which any of the Settlement Notes is convertible (collectively,
“Variable Rate
Transactions”) or (ii) enter into any agreement, or
issue any securities pursuant to any agreement, including, without
limitation, an equity line of credit, at-the-market offering or
similar agreement, whereby GT Biopharma may issue securities at a
future determined price.
l. Preservation of Corporate
Existence. The Company shall preserve and maintain its
corporate existence, rights, privileges and franchises in the
jurisdiction of its incorporation, and qualify and remain
qualified, as a foreign entity in each jurisdiction in which such
qualification is necessary in view of its business or operations
and where the failure to qualify or remain qualified might
reasonably have a Material Adverse Effect upon the financial
condition, business or operations of GT Biopharma, taken as a
whole.
m. Indemnification. To the fullest
extent permitted by law, GT Biopharma will, and hereby does,
indemnify, hold harmless and defend Claimants, the directors,
officers, partners, members, employees, agents, representatives of,
and each Person, if any, who controls any Investor within the
meaning of the 1933 Act or the 1934 Act (each, an
“Indemnified
Person”), against any losses, Claims, damages,
liabilities, judgments, fines, penalties, charges, costs,
reasonable attorneys’ fees, amounts paid in settlement or
expenses, joint or several (collectively, “Claims”), incurred in
investigating, preparing or defending any action, Claim, suit,
inquiry, proceeding, investigation or appeal taken from the
foregoing by or before any court or governmental, administrative or
other regulatory agency, body or the SEC, whether pending or
threatened, whether or not an indemnified party is or may be a
party thereto (“Indemnified Damages”), to
which any of them may become subject insofar as such Claims (or
actions or proceedings, whether commenced or threatened, in respect
thereof) arise out of, relate to, or are based upon: (a) any
misrepresentation or breach of any representation or warranty made
by GT Biopharma in the Settlement Documents, (b) any breach of any
covenant, agreement or obligation of GT Biopharma contained in the
Settlement Documents or (c) any cause of action, suit or claim
brought or made against such Indemnified Person by a third party
and arising out of, resulting from, or ancillary to the
transactions contemplated by the Settlement Documents (unless such
action is based upon a breach of such Indemnified Person’s
representations, warranties or covenants under the Settlement
Documents or any agreements or understandings such Indemnified
Person may have with any such stockholder or any violations by such
Indemnified Person of state or federal securities laws or any
conduct by such Indemnified Person which constitutes fraud, gross
negligence, willful misconduct or malfeasance). GT Biopharma shall
reimburse the Indemnified Persons, promptly as such expenses are
incurred and are due and payable, for any reasonable and invoiced
legal fees or other reasonable and invoiced expenses incurred by
them in connection with investigating or defending any such
Claim.
5. Representations and Covenants of
Claimants:
a. Authorization; Enforcement;
Validity. Each of Claimants has the legal capacity and right
to execute, deliver, enter into and perform the obligations under
this Agreement and each of the other Settlement Documents in
accordance with the terms hereof and thereof. This Agreement and
the other Settlement Documents are duly executed and delivered by
each of Claimants, and constitute the legal, valid and binding
obligations of each of Claimants, enforceable against Claimants in
accordance with their respective terms, except as such
enforceability may be limited by general principles of equity or
applicable bankruptcy, insolvency, reorganization, moratorium,
liquidation or similar laws relating to, or affecting generally,
the enforcement of applicable creditors’ rights and
remedies.
6. Non Disparagement. Each of
Claimants, and GT Biopharma, severally and not jointly, agrees
that, from and after the execution of this Agreement, each of them
shall not make, publish or communicate, or encourage any other
Person to make, publish or communicate, any Disparaging (as defined
below) remarks, comments, or statements concerning any other Person
that is subject to, or a signatory of, this Agreement. As used
herein, “Disparaging” remarks,
comments or statements are those that impugn the character,
honesty, integrity, morality, or business acumen or abilities in
connection with any aspect of the operation of business of, or
reflect negatively upon, the individual or entity being disparaged.
Each of Claimants, and GT Biopharma, severally and not jointly,
further agrees that, from the execution of this Agreement, they
shall not encourage any other Person to consider, threaten, or file
any action, Claim, suit, inquiry, or proceeding against any Person
that is subject to, or a signatory of, this Agreement. This
provision shall in no way limit the ability of any party to enforce
the Settlement Documents.
7. Confidentiality. The Parties
agree that the negotiations that resulted in this Agreement, are
confidential and they will not disclose them to any third party
except: (i) to their respective attorneys, accountants and
insurers; (ii) as required by, or for use in, any court of
competent jurisdiction or regulatory body or agency; (iii) as
required by any federal, state or municipal rule, regulation or
law; (iv) to any tax preparation professional and to the extent
necessary to accurately file city, state and federal taxes; and,
(v) with respect to Claimants only, to any limited partner,
potential investor or any other Person if, in Claimants' own
judgment, disclosure is necessary to explain, for any business
purpose, the background, circumstances, and/or results of the
Demand Letter or the Draft Complaint.
8. Entire Agreement; Amendments.
This Agreement and any schedules and exhibits hereto constitute the
entire agreement among the Parties as to the settlement and
supersede any prior agreements, including but not limited to any
preliminary, draft settlement documents, among the Parties with
respect to the subject matter of this Agreement. No
representations, warranties or inducements have been made or relied
upon by any Party concerning this Agreement or its exhibits, other
than the representations, warranties and covenants expressly set
forth in such documents. This Agreement shall not be modified or
amended in any way except in writing executed by or on behalf of
each Party to be bound thereby or by their respective
successors-in-interest.
9. Voluntary and Informed Assent.
Each Party to this Agreement represent and agree that the Party has
read and fully understood the provisions of this Agreement, that
they are fully competent to enter into and sign this Agreement, and
that they are executing this Agreement voluntarily, free of any
duress or coercion.
10. Construction. The language of
all parts of this Agreement shall in all cases be construed as a
whole, according to its fair meaning, and not strictly for or
against any Party. This Agreement was prepared jointly by the
Parties, and no presumptions or rules of interpretation based upon
the identity of the Party preparing or drafting the Agreement, or
any part thereof, shall be applicable or invoked.
11. Headings. The section headings
contained in each section of this Agreement are intended solely for
convenience of reference and shall not limit or expand the express
terms of this Agreement or otherwise be used in its
construction.
12. 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
New York, 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 any of the Settlement Documents (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 City of New York,
Borough of Manhattan (the “New York Courts”). Each
party hereto hereby irrevocably submits to the exclusive
jurisdiction of the New York Courts for the adjudication of any
dispute hereunder or in connection herewith or with any transaction
contemplated hereby or discussed herein (including with respect to
the enforcement of any of the Settlement Documents), 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 New York Courts, or such New York 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 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 attorney's fees and other costs and
expenses incurred in the investigation, preparation and prosecution
of such action or proceeding.
13. Waiver. The waiver by any Party
of any breach of this Agreement by the other shall not be deemed a
waiver of that or any other prior or subsequent breach of any
provision of this Agreement by any other Party.
14. Severability. If any provision
or provisions of this Agreement or the settlement shall be held to
contravene or be invalid under any applicable law, such
contravention or invalidity shall not invalidate the whole
Agreement, but the Agreement shall be construed as not containing
the particular provision or provisions held to be illegal, invalid
or unenforceable, and the remaining rights and obligations of the
Parties shall remain in full force and effect and construed and
enforced accordingly so long as this Agreement as so modified
continues to express, without material change, the original
intentions of the Parties as to the subject matter hereof and the
prohibited nature, invalidity or unenforceability of the
provision(s) in question does not substantially impair the
respective expectations or reciprocal obligations of the Parties or
the practical realization of the benefits that would otherwise be
conferred upon the Parties. The Parties will endeavor in good faith
negotiations to replace the prohibited, invalid or unenforceable
provision(s) with a valid provision(s), the effect of which comes
as close as possible to that of the prohibited, invalid or
unenforceable provision(s).
15. Effect of Cancellation or
Termination. If the settlement set forth in this Agreement
does not become effective, or is terminated, reversed or vacated by
a court of competent jurisdiction for any reason, then,
notwithstanding anything herein to the contrary, the settlement set
forth in this Agreement shall be null and void and of no further
force or effect, and each Party shall be restored to his, her or
its respective position as it existed prior to the execution of
this Agreement, including for statute of limitations purposes.
Neither the existence of this Agreement, the facts of its
existence, the terms hereof or any statements or negotiations
between the Parties relating hereto shall be admissible in evidence
or shall be referred to for any purpose in any subsequent
litigation, action or proceeding, except in a proceeding to enforce
its terms.
16. Binding Effect. This Agreement
binds and inures to the benefit of the Parties and their respective
past and present agents, employees, attorneys, representatives,
officers, directors, shareholders, successors, assigns,
transferees, insurers and sureties, and all of their subsidiaries,
parents, predecessors, successors and controlled or affiliated
companies.
17. Notices. Any notices, consents,
waivers or other communications required or permitted to be given
under the terms of this Agreement or any other Settlement Documents
must be in writing and will be deemed to have been delivered: (i)
upon receipt, when delivered personally; (ii) upon delivery, when
sent by facsimile (provided confirmation of transmission is
mechanically or electronically generated and kept on file by the
sending party), (iii) upon delivery, when sent by electronic mail
(provided that the sending party does not receive an automated
rejection notice); or (iv) one Business Day after deposit with an
overnight courier service, in each case properly addressed to the
party to receive the same. The addresses, facsimile numbers and
e-mail addresses for such communications shall be:
If to
GT Biopharma:
GT
Biopharma, Inc.
9350
Wilshire Blvd, Suite 203
Beverly
Hills, CA 90212
Email:
sww@gtbiopharma.com; ajc@gtbiopharma.com
With a
copy to (for informational purposes only):
Perrie
Weiner
Baker
McKenzie
1901
Avenue of the Stars Suite 950
Telephone: (310)
201-4709
Facsimile: (310)
201-4721
E-mail:
perrie.weiner@bakermckenzie.com
If to
Claimants:
Adam
Kasower
25170
Jim Bridger Road
Hidden
Hills, CA 91302
East
Ventures, Inc.
269 S
Beverly Drive, Suite 1079
Beverly
Hills, CA 90210
SV
Booth Investments III, LLC
1280
5th Ave
New
York NY 10029
Theorem
Group, LLC
269 S
Beverly Drive, Suite 1079
Beverly
Hills, CA 90212
With a
copy (for informational purposes only) to:
LAW
OFFICES OF JACQUES CHEN
Jacques
Chen, Esq.
2029
Century Park East, Suite 400
Los
Angeles, CA 90067
Telephone:
(310) 201-4382
Facsimile:
(866) 425-6035
E-mail:
jchen028@gmail.com
18. Specific Performance. Each
Party hereto acknowledges and agrees, on behalf of itself, herself
or himself and its, her or his affiliates, that irreparable harm
would occur in the event any of the provisions of this Agreement or
any of the other Settlement Documents were not performed in
accordance with their specific terms or were otherwise breached. It
is accordingly agreed that the Parties will be entitled to specific
relief hereunder, including, without limitation, an injunction or
injunctions to prevent and enjoin breaches of the provisions of
this Agreement and/or the other Settlement Documents and to enforce
specifically the terms and provisions hereof and thereof, in
addition to any other remedy to which they may be entitled at law
or in equity.
19. Counterpart Signature Pages:
This Agreement may be executed in any number of counterparts, and
each counterpart shall have the same force and effect as an
original and shall constitute an effective, binding agreement on
the part of each of the undersigned, all counterparts when taken
together shall constitute the entire Agreement.
IN WITNESS WHEREOF, the Parties have
caused this Agreement to be executed by themselves or their duly
authorized representatives on the respective dates set forth
below.
|
Dated:
November ___, 2020
GT BIOPHARMA, INC.
By:
____________________________
Name:
Anthony Cataldo
Title:
Chief Executive Officer
|
Dated:
November ___, 2020
EAST VENTURES, INC.
By:
____________________________
Name:
Title:
|
|
Dated:
November ___, 2020
________________________________
Adam
Kasower
|
Dated:
November ___, 2020
SV BOOTH INVESTMENTS III, LLC
By:
____________________________
Name:
Title:
|
Dated:
November ___, 2020
THEOREM GROUP, LLC
By:
____________________________
Name:
Title:
[Signature
Page—Settlement Agreement]
EXHIBIT A
FORM OF SETTLEMENT NOTE