Monday, March 02 2015 3:54 PM, EST INFRAX SYSTEMS, INC. FILES (8-K) Disclosing Entry into a Material Definitive Agreement, Financial Statements and Exhibits Edgar Online "Glimpses"
Item 1.01. Entry into a Material Definitive Agreement.
On February 27, 2015 , an ASSETS AND STOCK PURCHASE AGREEMENT was entered (the "Agreement"), by and among FutureWorld Corporation, a Delaware Corporation (referred to by name, "FWDG" or as "Seller"), and Infrax Systems, Inc. , a Nevada corporation (referred to as ""Corporation," "IFXY", or "Buyer"). FutureWorld Corp is the one hundred percent (100%) owner of HempTech Corp which is a Delaware wholly owned subsidiary. HempTech Corp is a technology company that provides smart sensors and data analysis technology, RFID tracking systems, communication networking and surveillance security for the cannabis and agricultural industries.
The purchase price for the ASSETS AND STOCK PURCHASE AGREEMENT (the "Purchase Price") shall be sixty million dollars ( $60,000,000 ). Infrax Systems shall pay;
1- Ten million dollars ( $10M ) in cash, payable in installments as convertible
notes. The cash payment shall be made available through operational revenue
and/or registration by the Company.
2- Ten million dollars ( $10M ) in Common Stock, par value $0.001 .
3- Forty million dollars ( $40M ) in Preferred Shares Series A1, or 33,000,000
shares, par value $0.001 , of Infrax Systems, Inc. Each Preferred Shares Series
A1 is convertible into 88.89 shares of Common Shares.
Material Relationship - There exist a material relationship between the registrant and the purchaser on this transaction. Talari Industries is the majority shareholder of both the registrant and the purchaser and its principle, Mr. Talari , is the CEO of the registrant.
Infrax Systems' fundamental reasons to purchase HempTech are;
1- HempTech's recent substantial contracts which would contribute greatly to
Infrax's bottom line.
2- HempTech's Proforma revenue of $100M by 2019.
3- HempTech's unique and disruptive technologies for agricultural sector.
4- HempTech has no direct competitors among publicly held companies in this
space.
5- HempTech has moved from a development company to a start-up in 2014 and is
likely to complete early stage grow in 2015.
6- HempTech's packaged solution is a substantial competitive advantage.
7- HempTech is in a highly fragmented industry that is experiencing explosive
growth.
8- Infrax's ability to reach agricultural sector offering disruptive technologies
not present at this point.
With the purchase of HempTech Corp , Infrax Systems will initiate a new division for agricultural related technologies (or Agritech). After the transaction, Infrax will continue to provide secure communication technologies to utilities through design and manufacturing of sensors and communications products. Infrax Systems acquisition of HempTech Corp will help expand its reach in the Cannabis and Agricultural technologies (agritech) which are the fastest growing sectors in the market.
The aforementioned transaction ensued due to the December 23, 2014 , Infrax Systems' announcement of an agreement with FutureWorld Corp and its subsidiaries ( HempTech Corp ). In consideration for the development of the current and future Products, the FutureWorld agreed to pay Infrax Systems a one-time development fee of $2M , all in cash or a combination of cash and shares of common stock.
After lengthy discussion with our legal and accounting on this agreement, we came to a conclusion that the agreement, being a non-arms-length transaction, might be construed as a "conflict of interest" and may not be financially or legally sound without an independent third party validation. And since most of the fundamental technologies for the aforementioned transaction is derived
from Infrax Systems for FutureWorld and its subsidiary, HempTech Corp , we were recommended by our legal and accounting to discontinue the license agreement and instead consider outright purchase of HempTech Corp. Hence, in January 2015 , FutureWorld retained an independent valuation firm on the considered business transaction. On February 17 , both Companies received the market valuation of $60,000,000 for HempTech Corp from the third party firm. The valuation report was used as a basis for the agreed upon transaction with FutureWorld Corp with the instruction of the auditors.
Item 4.01. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Effective March 02, 2015 , Mr. Sam Talari has resigned as the acting CEO of Infrax Systems . Concurrently, the board of directors have elected Mr. John Verghese as the new CEO of Infrax Systems, Inc. , effective immediately. The transition was the result of the purchase agreement between FutureWorld Corp. and Infrax Systems .
Item 9.01. Financial Statements and Exhibits
(d) Exhibits. Exhibit No. Description
2.1 ASSETS AND STOCK PURCHASE AGREEMENT, dated as of February 27, 2015 , by and
among Mount by and among FutureWorld Corporation, a Delaware Corporation (referred to by name, "FWDG" or as "Seller"), and Infrax Systems, Inc. , a Nevada corporation (referred to as ""Corporation," "IFXY", or "Buyer").
10.1 Securities Purchase Agreement (including Form of Note and Security Purchase Agreement).
AI
