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COMPLAINT
Plaintiff,
Case No. _______________
v.
Judge _______________________
OLDE MONMOUTH STOCK TRANSFER
CO., INC., a New Jersey corporation,
Defendant.
Red Cliffs Investments Inc. (Red Cliffs) is Typenexs sole manager and
member and is a Utah corporation with its principal place of business in Chicago, Illinois. JFV
Holdings, Inc. (JFV) is Red Cliffs sole shareholder and is an Illinois corporation with its
principal place of business in Chicago, Illinois. John Fife is JFVs sole shareholder and is
domiciled in and a citizen of Chicago, Illinois.
3.
Defendant Olde Monmouth Stock Transfer Co., Inc. (Olde Monmouth), is, and
at all times relevant hereto was, a New Jersey corporation with its principal place of business in
New Jersey.
JURISDICTION AND VENUE
4.
contracts out of which the causes of action arise were entered into in Cook County, Illinois.
GENERAL ALLEGATIONS
Typenex purchases a Warrant from DNA Precious Metals.
6.
On April 28, 2014, Typenex and DNA Precious Metals, Inc. (DNA) entered
into a Securities Purchase Agreement (the Purchase Agreement) whereby DNA agreed to sell
and Typenex agreed to buy, among other things, a Secured Convertible Promissory Note (the
Note) and a Warrant to Purchase Shares of DNAs Common Stock (the Warrant).
7.
Under the terms of the Purchase Agreement and the Warrant, DNA granted
Typenex, among other things, the right to acquire shares of DNAs common stock, based on the
specific formula set forth in the Warrant.
8.
Sometime in 2015 and after entering into the agreements at issue, DNA changed
its name to, and/or merged with, Breathe eCig Corp. (eCig). Hereafter, DNA will be referred
to simply as eCig.
In addition to entering into the Securities Purchase Agreement and issuing the
Warrant, and by express reference thereto, eCig also issued irrevocable instructions to its transfer
agent Olde Monmouth by way of a letter dated April 28, 2014 (the Transfer Instructions). (A
true and correct copy of the Transfer Instructions is attached hereto as Exhibit A.)
10.
eCig and its transfer agent, Olde Monmouth, both signed the Transfer Instructions
acknowledging that both will be bound by those terms and conditions contained in the Transfer
Instructions and further acknowledging that Typenex is the intended third-party beneficiary of
the Transfer Instructions.
11.
The Transfer Instructions both authorize and require that Olde Monmouth issue
shares of eCigs common stock to Typenex (or its broker) upon delivery to Old Monmouth of a
notice of exercise of the Warrant (Notice of Exercise) and a legal opinion from Typenexs
counsel that the issuance of the Warrant Shares to [Typenex] is exempt from registration under
the 1933 Act or otherwise as to the free transferability of the Warrant Shares.
12.
is required to issue the requested shares to Typenex within three (3) Trading Days after its
receipt of the Notice of Exercise.
13.
15.
16.
with the required legal opinion, to Olde Monmouth. (A copy of the Notice of Exercise is attached
as Exhibit B.)
17.
As set forth in the Notice of Exercise, Typenex elected to exercise a portion of its
rights under the Warrant and receive 7,541,511 shares (the Warrant Shares) of eCigs
common stock.
18.
Despite having received the Notice of Exercise and required legal opinion, Olde
Monmouth has failed and/or refused to deliver the Warrant Shares as required by the Transfer
Instructions.
FIRST CAUSE OF ACTION
(Breach of the Transfer Instructions)
19.
20.
between Typenex and Olde Monmouth with Typenex as an express intended third-party
beneficiary.
21.
covenant of good faith and fair dealing thereinby failing and/or refusing to honor the Notice of
Exercise and by failing and/or refusing to act in accordance with the instructions contained in the
Transfer Instructions.
22.
Instructions, Typenex has incurred damages in an amount to be established at trial but at least the
value of those shares requested in the Notice of Exercise, together with all other charges, fees,
and collection costs provided for in the relevant agreements.
23.
preventing Olde Monmouth from further violating the Transfer Instructions by delaying issuance
of the requested shares to Typenex.
24.
26.
duty upon an issuer to register transfer of stock when presented with a request to register
transfer. The UCC also extends this duty to those entities employed as transfer agents for a
given issuer.
27.
If the issuer (and/or its transfer agent) unreasonably delays or refuses to register a
transfer, the UCC establishes liability for the issuer and transfer agent to the requesting party for
any loss resulting from the delay or refusal.
28.
In this matter, eCig is an issuer and Olde Monmouth is its transfer agent.
29.
Typenex presented a proper request to register transfer, in the form of the Notice
After receiving the Notice of Exercise, Olde Monmouth (as eCigs transfer agent)
refusal to register the requested transfer, Typenex has incurred damages in an amount to be
established at trial.
33.
35.
whereby, among other things, Olde Monmouth agreed to honor Typenexs Notice of Exercise.
The Transfer Instructions allow Typenex to enforce specifically the terms and provisions of that
agreement.
36.
37.
Olde Monmouth has failed to honor the Notice of Exercise, as required by the
Transfer Instructions.
38.
40.
those shares requested in the Notice of Exercise, together with pre- and post-judgment interest as
provided for by law;
b.
c.
violation of the UCC against Olde Monmouth, for damages in an amount to be established at
trial, together with interest, charges, attorney fees, costs, and injunctive relief requiring Olde
Monmouth to comply with the Transfer Instructions, honor the Notice of Exercise, and deliver
the Warrant Shares.
3.
against Olde Monmouth, for a judgment ordering Olde Monmouth to comply with the Transfer
Instructions and to honor the Notice of Exercise.
4.
For such other and further relief as the Court deems just, equitable, or as allowed
by law.
DATED the 28th day of May 2015.
Respectfully submitted,
TYPENEX CO-INVESTMENT, LLC
By:
s/Jeremy C. Reutzel
One of its Attorneys