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Item 1.01
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Entry into a Material Definitive Agreement
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Summary of the Transaction
Genufood Energy Ezymes Corp. (the “Company”
or “we”), Yu-Lin Chen, an individual and resident of the Republic of China (the “Purchaser”) and Hukui Biotechnology
Corporation, an international company incorporated in Samoa (“Hukui”), entered into a Stock Purchase Agreement dated as of
November 17, 2021 (the “Stock Purchase Agreement”), pursuant to which we agreed to sell 140,000 shares of Hukui’s Series
C Preferred Stock (the “Hukui Shares”) to the Purchaser for $350,000 in cash, or $2.50 per share. The sale of the Hukui Shares
closed on November 19, 2021.
We had purchased the Hukui Shares in two tranches,
on December 15, 2020 and June 30, 2021, pursuant to that certain Series C Preferred Shares Subscription Agreement dated September 23,
2020 (the “Hukui Agreement”), at $10.00 per share, for an aggregate purchase price of $1,400,000.
Background of the Transaction
As a result of our original purchase of the first
80,000 of the Hukui Shares on December 15, 2020, together with certain other factors, we may have been deemed to be an investment company
under the Investment Company Act of 1940, as amended (the “Investment Company Act”). To the extent that we may have been deemed
to be an investment company, we have been relying on Rule 3a-2 promulgated under the Investment Company Act, allowing us to terminate
our investment company status on or before December 15, 2021, the first anniversary of our purchase of the first 80,000 of the Hukui Shares,
without having to register and be regulated as an investment company.
Believing that it is not in the best interests
of the Company and its shareholders to register and be regulated as an investment company under the Investment Company Act, we explored
different lawful means by which we could terminate our potential investment company status. We determined that the only viable option
to terminate our potential investment company status and lawfully avoid registration and regulation under the Investment Company Act was
to sell the Hukui Shares on or before the December 15, 2021 deadline.
After making diligent efforts to seek a purchaser
of the Hukui Shares, we received three all-cash offers to purchase the Hukui Shares. We accepted the offer of the Purchaser, which was
the highest of the three all-cash offers that we received.
With the sale of the Hukui Shares, we believe that
we are no longer deemed to be an investment company as defined in the Investment Company Act and, accordingly, we are not required to
register and be regulated as an investment company thereunder.