MEMORANDUM OF UNDERSTANDING Between Minerco, Inc. and

MEMORANDUM OF UNDERSTANDING Between Minerco, Inc. and Priwen Systems Inc.
February 27, 2018 /in Uncategorized /by minerco
MEMORANDUM OF UNDERSTANDING

Between Minerco, Inc. and Priwen Systems Inc.

For 60% Equity Investment in Priwen Systems Inc.

THIS MEMORANDUM OF UNDERSTANDING (“MOU”) is entered into this 23rd day of February 2018 by and between Minerco, Inc., a Nevada corporation (“Minerco”), and Priwen Systems Inc., a Canadian corporation (“Priwen”), (collectively, the “Parties”).

RECITALS:

WHEREAS, Minerco is a publicly traded company (OTC: MINE) with one class of common stock and four (4) classes of preferred stock;

WHEREAS, Minerco is a holding company with assets and subsidiaries in the beverage, brand management and entertainment businesses and is seeking to acquire additional assets;

WHEREAS, Priwen owns and operates a cryptocurrency mining business and brand, “XMining,” which currently operates in Montreal, Quebec (“XMining”);

WHEREAS, Priwen is in the cryptocurrency mining business and is seeking to raise capital and grow its operations and brand(s);

WHEREAS, Priwen is willing to sell a controlling interest in Priwen to expand and accelerate the business plan;

WHEREAS, Minerco is considering an equity investment in Priwen; and

WHEREAS, the Parties are entering into this MOU to set forth their mutual intentions regarding the equity purchase of Priwen.

NOW, THEREFORE, in consideration of the mutual understandings and agreements set forth herein, the parties hereto hereby agree as follows:

1. Priwen Valuation. For the purposes of this MOU, the Parties agree to a valuation of Priwen and its brand(s) to be $850,000 for 100% of Priwen and its brand(s).

2. Equity Investment. Minerco agrees to purchase sixty percent (60%) of the equity AND controlling interest of Priwen and its brand(s) from Priwen for total consideration of $500,000 into Priwen operations in exchange for being issued or transferred sixty percent (60%) of the issued and outstanding shares of Priwen (the “Equity Investment”).

3. Purchase Price. Minerco agrees to pay the Equity Investment into Priwen as follows:
1. At the closing of the definitive agreement and following the due diligence process (the “Closing”), Minerco shall distribute $100,000 to Priwen for crypto mining operations;
2. Thirty (30) days following Closing, Minerco shall distribute $50,000 to Priwen for crypto mining operations;
3. Sixty (60) days following Closing, Minerco shall distribute $50,000 to Priwen for crypto mining operations;
4. Ninety (90) days following Closing, Minerco shall distribute $50,000 to Priwen for crypto mining operations;
5. One Hundred and Twenty (120) days following Closing, Minerco shall distribute $150,000 to Priwen for crypto mining operations;
6. One Hundred and Fifty (150) days following Closing, Minerco shall distribute $50,000 to Priwen for crypto mining operations;
7. One Hundred and Eighty (180) days following Closing, Minerco shall distribute $50,000 to Priwen for crypto mining operations;
8. All Equity Investment from Minerco into Priwen shall be used for operations as listed in the due diligence package and/or the Use of Proceeds.
Any deviation from the operations or use of proceeds will be approved by Minerco prior to such deviation;
9. Priwen will issue or cause to be transferred sixty percent (60%) of all the outstanding equity of Priwen to Minerco which may include common or preferred classes of equity to total sixty percent (60%) of all the issued and outstanding equity of Priwen.
10. At any time after the Closing , but before one year following the Closing, Minerco and Priwen agree the Parties may elect to exchange additional equity (greater than the Closing 60% of Priwen to Minerco) in Minerco and Priwen. The exchange is to be fixed at the valuations of this Closing of both Minerco and Priwen. Priwen may elect to take Minerco equity in any class of stock available at the time of the exchange. (the “Equity Exchange”).

4. Corporate Structure. The Parties agree that the corporate structure of Priwen is a condition to closing the Definitive Agreement and Priwen will engage solely in the Priwen Business pursuant to and in accordance with the business plan attached hereto as Appendix 1 (the “Priwen Business”).
1. The equity of Priwen will be sixty percent (60%) owned by Minerco, or their assigns, and forty percent (40%) owned by the Priwen, or their assigns (the “Existing Priwen Shareholders”), subsequent to the completion of the Equity Investment;
2. Minerco will have voting control of Priwen;
3. Priwen shall have 3 members of the board of directors (“BOD”): 1 designated by Minerco, 1 designated by Priwen and 1 mutually agreed independent director;
4. Priwen has the expertise to run the Priwen Business; therefore, upon approval of the BOD, Priwen operations will be managed by the current management team of Priwen;
5. Existing Priwen Shareholders (40% equity after Equity Investment) shall maintain customary minority rights in Priwen;
6. Existing Priwen Shareholders (40% equity after Equity Investment) may appoint a Chief Operations Officer or Chief Technology Officer to the executive staff of Minerco, upon approval by the Minerco Board of Directors.


5. Unwind of Equity Investment.
1. The Parties may unwind the Equity Investment at any time prior to the Closing;
2. Priwen may unwind the Equity Investment if any item in Section 3 is not delivered and/or cured. Any parts of Section 3 which have been delivered may be returned or Priwen may give credit to Minerco for the equity share earned by the non-returned deliveries, prorate;
3. Minerco may unwind the Equity Investment if any item in Section 4 is not delivered and/or cured;
4. In the case of fraud or diversion from the Priwen Business, Minerco may unwind the Equity Investment by giving 60 days notice to Priwen and returning all equity and control of Priwen to Priwen; or
5. The Parties may unwind the Equity Investment upon mutually agreed written consent.

6. Confidentiality. The parties acknowledge that, in the course of their negotiations under this MOU, it may be necessary for one party to provide documentation, technical and business information and/or intellectual property, in whatever form recorded (collectively, “Confidential Information”), to the other party. All Confidential Information provided or disclosed by either party hereunder shall remain the property of the furnishing party, and shall be held in strict confidence by the receiving party, unless the furnishing party otherwise consents in writing or unless disclosure of such Confidential Information is required by the applicable laws. Confidential Information furnished by any party hereunder (i) shall not be reproduced or copied, in whole or in part, by the receiving party except for use as specifically authorized by this MOU; (ii) shall, together with any copies thereof, be returned to the disclosing party, or at the request of the disclosing party, destroyed, when no longer needed for purposes of this MOU; and (iii) shall only be disclosed by the receiving party to its employees who have a need to know such Confidential Information in connection with the performance of this MOU; and who have agreed to comply with the confidentiality obligations set forth herein.
7. Publicity. Neither party shall issue any press release or otherwise publicize or disclose to any third party the existence or nature of this MOU without the prior written consent of the other party, which consent shall not be unreasonably withheld.
8. Exclusivity. Priwen agrees that, for a period of sixty (60) days following execution of this MOU, or until the Closing Date, whichever comes first (the “Exclusivity Period”) where Priwen or the Existing Priwen Shareholders will not engage in any discussions or negotiations with any other company with respect to its Priwen Business.
9. Definitive Agreement. The parties agree to use best means possible to draft, deliver and execute definitive agreements with respect to this MOU. The parties strive to complete all due diligence and drafting within thirty (30) days from the date of this MOU.
10. Term and Termination. This MOU shall become effective on the date first set forth above and shall terminate upon the earliest to occur of the following: (a) the execution by the parties of one or more definitive agreements with respect to the subject matter of this MOU; or (b) three (3) months from the date hereof.
11. Non-Binding Effect. This MOU is intended to serve as a general basis for commencing negotiations for one or more definitive agreements between the Parties and/or the Priwen Business with respect to the matters referenced herein. This MOU does not contain all of the detailed provisions to be incorporated in any such definitive agreement(s), but does reflect the current mutual intentions of the parties. With the exception of Sections 6 and 7, hereof, which are intended to be binding upon the parties, neither of the Parties shall have any legal obligation under or by virtue of this MOU, including any obligation to enter into any definitive agreement or other contract, to provide any services, to disclose any information, to make any investment or to pay any consideration or compensation, whether or not expressly described herein; provided that the parties agree to cooperate in good faith along the lines described in this MOU.

IN WITNESS WHEREOF , the parties have caused this MOU to be executed by their duly authorized representatives as of the date first above written.

MINERCO, INC. Priwen SYSTEMS INC.



_/s/ V. Scott Vanis__________ _/s/ Gordon Macfie_________

By: V. Scott Vanis By: Gordon Macfie

Its: Chief Executive Officer Its: CEO


APPENDIX I

PRIWEN BUSINESS

1. Crypto mining : Priwen owns and operates crypto mining equipment. The equipment falls into two classes, ASIC and GPU.
1. ASIC Hardware: These are purpose built machines with custom-designed circuits (ASIC stands for: Application-Specific Integrated Circuit) that are built for the sole purpose of mining a specific cryptocurrency. They do not use ATX standard parts and cannot be used for any other purpose. They are much more powerful than GPUs and more power efficient. They are meant to run continuously with minimum supervision.
2. GPU rigs: These are essentially high-end desktop computers that use commonly available ATX-standard components. The rigs use the GPUs on high-end graphics cards to mine cryptocurrencies. They are more expensive than dedicated asics but they are more versatile as they can be configured to mine many different cryptocurrencies.
2. Activities associated to crypto mining : Priwen has built accessories (power supplies etc.), hosted equipment, built its own GPU equipment, looked at ways of improving existing equipment, considered software development options and spoken with miners needing engineering assistance (consulting). Priwen is and will continue to continue to be in the more global crypto mining market thus enabling diversification and diminishing the risk of being exposed to one area of the industry.
3. General engineering : Priwen has engineered an industrial smartwatch and done some consulting for individuals in the audio business. While Priwen will remain focused on points 1 and 2, in the interest of the company and shareholder value, we will listen to other opportunities that could build on the existing knowledge base and leverage our current business model and contacts.
http://minercoinc.com/memorandum-of-understan...stems-inc/