SECURITIESPURCHASEAGREEMENT
This securities purchaseagreement (the“Agreement”),dated as of June 27, 2017, by andbetween Max Sound Corporation., aDelawarecorporation,with headquarters located at 8837Villa La JollaDrive, Unit12109,La Jolla,California 92039 (the“Company”),andBellridge Capital LP, aDelaware company with its officeat 515E. Las Olas Boulevard,Suite 120A FortLauderdale, Florida 33301 (the “Buyer”).
WHEREAS:
A. The Company and theBuyer are executing and delivering thisAgreement in reliance upon Section 4(a)(2) of the SecuritiesActof 1933, asamended (the “1933Act”)andRule 506 ofRegulation Dpromulgatedthereunder and enforced by theUnited States Securities andExchange Commission (the“SEC”);
B. Buyer desires to purchase and theCompanydesires to issue and sell, upon theterms and conditions set forth in thisAgreement an eight percent(8%) convertible note of theCompany, in the form attached hereto asExhibitA in the aggregate principalamount of US$268,000 (togetherwithany note(s) issued inreplacement thereof or as a dividend thereon orotherwise with respect thereto in accordancewith thetermsthereof, the“Note”), convertible into shares ofcommonstock, par value US
$0.00001 of theCompany(the“Common Stock”),upon theterms and subject to thelimitationsand conditions set forth in suchNote. The Note contains an 8% original issue discount such that the purchase price of theNote shall be $246,560 before deduction of expenses of $7,500which theCompany shall be responsible for.
C. The Buyer wishes to purchase, upon the terms and conditions stated in thisAgreement, such principalamount ofNoteas is set forthimmediately below itsnameon the signature pages hereto; and
NOW THEREFORE, theCompany and theBuyerseverally (and not jointly) hereby agree as follows:
1. Purchase andSale ofNote.
| (a) | PurchaseofNote. On theClosing Date (as definedbelow),theCompany shall issue andsellto theBuyer and theBuyeragrees to purchase from theCompany such principalamount ofNoteas is set forthimmediately below theBuyer’s name on the signature pageshereto. |
| (b) | FormofPayment. On the Closing Date (as defined below), (i) theBuyershall pay the purchase price for theNoteto be issued and sold to it at theClosing(as definedbelow) (the “Purchase Price”) bywire transfer ofimmediately available funds to theCompanyor its legal counsel in trust, in accordancewiththeCompany’s written wiring instructions, against delivery of theNote in the principalamount equal to the Purchase Price as is set forthimmediately below theBuyer’s name on the signature pages hereto, and (ii) theCompany shall deliver such duly executedNote on behalf of theCompany, to theBuyer, against delivery of such PurchasePrice. |
| (c) | Closing Date. The date and time of the first issuance and sale of the Note pursuant to thisAgreement (the“Closing Date”) shall be on or about June 27, 2017, or such other mutually agreed upontime. The closing of the transactionscontemplated by thisAgreement(the“Closing”) shall occur on theClosing Date at such location asmay be agreed to by the parties. |
| 2. | Buyer’s Representations and Warranties. The Buyer represents and warrants to theCompanythat: |
| (a) | Investment Purpose. As of the date hereof, theBuyeris purchasing the Note and the shares ofCommonStock issuable upon conversion of orotherwisepursuant to theNote, such sharesof Common Stock being collectively referred to herein as the“Conversion Shares”and, collectivelywith theNote,the“Securities”) for itsown account and notwitha presentview towards the public sale or distribution thereof, except pursuant to sales registered orexemptedfrom registration under the 1933 Act; provided,however,that by making the representations herein, theBuyerdoes not agree to hold any of the Securities for anyminimumor other specific term and reserves the right to dispose of the Securities at anytime in accordancewithor pursuant to a registrationstatement or anexemption under the 1933Act. |
| (b) | AccreditedInvestorStatus. The Buyer is an “accredited investor” as that term is definedin Rule 501(a) ofRegulation D andNational Instrument 45-106 -Prospectus Exemptions (an “Accredited Investor”). |
| (c) | RelianceonExemptions. The Buyer understands that the Securities are being offered and sold to it in reliance upon specificexemptionsfrom the registrationrequirementsofUnitedStates federal and state securities laws and Canadian securities laws and that theCompany is relying upon the truth and accuracy of, and theBuyer’s compliance with,the representations,warranties, agreements, acknowledgments and understandings of theBuyerset forth herein in order todetermine the availability of suchexemptions and the eligibility of theBuyer to acquire theSecurities. |
| (d) | Information. The Buyer and its advisors, if any, have been, and for so long as theNote remain outstandingwillcontinue to be, furnishedwith allmaterialsrelating to the business, finances and operations of theCompanyandmaterials relating to the offer and sale of theSecurities which have been requested by theBuyer or its advisors.The Buyer and its advisors, if any, have been, and for so long as theNote remain outstandingwill continue to be, affordedthe opportunity to ask questions of theCompany. Notwithstanding the foregoing, theCompany has not disclosed to theBuyeranymaterial non-publicinformationandwill not disclose suchinformationunless suchinformation is disclosed to the public prior to orpromptly following such disclosure to theBuyer. Neither such inquiries nor any other due diligence investigation conducted byBuyeror any of its advisors or representatives shallmodify, amend or affectBuyer’s right to rely on theCompany’s representations andwarranties contained in Section 3below. The Buyer understands that itsinvestmentin the Securities involves a significant degree of risk.The Buyer is notaware of any facts thatmay constitute a breach of any ofthe Company's representations andwarranties made herein. |
| (e) | Governmental Review. The Buyer understands that no United States federal or state agency or any othergovernment orgovernmentalagency has passed upon ormade anyrecommendation orendorsementof theSecurities. |
| (f) | TransferorRe-sale. The Buyer understands that (i) the sale orre-saleof theSecurities has not been and is not being registered under the 1933Act or any applicable state securitieslaws, and the Securitiesmay not be transferred unless (a) the Securities are sold pursuant toaneffective registrationstatementunder the 1933Act,(b) theBuyershall have delivered to theCompany, at the cost of theBuyer, an opinion of counsel that shall be inform, substance and scopecustomary for opinions of counsel incomparabletransactions to the effect that theSecuritiesto be sold or transferred by theBuyer maybe sold or transferred pursuant toan exemptionfrom registration, (c) the Securities are transferred or sold pursuant toRule144promulgated under the 1933Act,or (d) the Securities are sold pursuant toRegulationS under the 1933Act (or a successor rule)(“Regulation S”), and theBuyer shall have delivered to theCompany, at the cost of theBuyer,an opinion of counsel that shall be inform,substance and scopecustomary for |
opinions of counsel in corporate transactions; (ii) any sale of such Securitiesmade in reliance onRule 144may bemadeonly in accordancewith theterms of saidRule and further, if saidRule is not applicable, any re-sale of suchSecurities undercircumstancesinwhich the seller (or the person throughwhomthe sale ismade) may bedeemed to be anunderwriter (as that term is defined in the 1933Act) may requirecompliance with some otherexemptionunder the 1933Act or the rules and regulations of theSEC thereunder; and (iii) neitherthe Company nor any other person is under any obligation to register such Securities under the 1933Act or any state securitieslaws or tocomply with thetermsand conditions ofany exemption thereunder (in each case).Notwithstandingthe foregoing or anything else contained herein to the contrary, the Securitiesmaybe pledged as collateral in connectionwith a bona fidemarginaccount or other lendingarrangement.
| (g) | Legends. The Buyer understands that the Note and, until such time as theConversion Shares have been registered under the 1933Actormay be resold pursuant toRule144 orRegulation Swithoutany restriction, theConversion Shares willbear a restrictive legend in substantially thefollowingform (and a stop-transfer ordermay be placed against transfer of the certificates for suchSecurities): |
“NEITHER THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE EXERCISABLE HAVE BEEN REGISTERED UNDER THESECURITIES ACT OF 1933,AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) INTHE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THESECURITIES ACT OF 1933,AS AMENDED, OR (B) AN OPINION OF COUNSEL (WHICH COUNSEL SHALL BE SELECTED BY THE HOLDER), IN AGENERALLY ACCEPTABLE FORM, THAT REGISTRATION ISNOT REQUIRED UNDER SAID ACT OR (II)UNLESS SOLD PURSUANT TO RULE 144,RULE 144AUNDER SAID ACT OR SUCH OTHER APPLICABLE EXEMPTION FROM REGISTRATION. NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED INCONNECTION WITH ABONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE SECURITIES.”
and in addition theNote and any applicableConversionShares issued thereunder shallbear thefollowinglegend in respect of applicableCanadian securitieslawsuntil theapplicable conditions underCanadiansecuritieslaws are satisfied:
Thelegend set forth above shall beremoved and theCompanyshall issue a certificatewithout such legend to the holder of anySecurityuponwhich it isstamped, if, unlessotherwise required by applicable state securitieslaws,(a) suchSecurity is registered for sale under an effective registrationstatementfiled under the 1933Act orotherwise may be sold pursuant toRule 144 orRegulationSwithout any restriction as to thenumberof securities as of a particular date that can then beimmediately sold, or (b) such holder provides theCompany with an opinion of counsel, inform,substance and scopecustomary for opinions of counselin comparable transactions, to the effect that a public sale or transfer of such Securitymaybemade without registration under the 1933 Act, which opinion shall be accepted by theCompany so that the sale or transfer is effected.The Buyer agrees to sell all Securities, including those represented by a certificate(s) fromwhichthe legend has beenremoved, in compliance with applicable prospectus deliveryrequirements, if any. In the event that theCompanydoes not accept theopinion
of counsel provided by theBuyer with respect to the transfer of Securities pursuant toan exemption from registration, such asRule144 orRegulation S,within 2 business days, itwill be considered anEvent ofDefault under theNote.
| (h) | Authorization; Enforcement. ThisAgreement has been duly and validly authorized. ThisAgreementhas been duly executed and delivered on behalf of theBuyer,and thisAgreement constitutes a valid and bindingagreement of theBuyerenforceable in accordancewith itsterms. |
3. Representations andWarrantiesof theCompany. The Company represents and warrants to theBuyer that:
| (a) | OrganizationandQualification. The Company and each of its subsidiaries, if any, is a corporation duly organized, validly existing and in good standing under thelawsof the jurisdiction in which it is incorporated, with fullpowerand authority (corporate and other) toown,lease, use and operate its properties and to carry on its business as andwherenowowned, leased, used, operated and conducted.The Company or one of its subsidiaries isthe sole registered and beneficialowner of all of the outstanding shares in the capital of or outstanding shares of capital stock or otherownership,equity or voting interests ofthe subsidiaries of theCompany free and clear of anyLiens (as definedbelow),all such shares are validly issued, fully paid andnon-assessable,and no other personhas any option, right,entitlement, understanding orcommitment(contingent orotherwise) regarding the right to acquire any such share or interest in any of theCompany’ssubsidiaries and no subsidiary of theCompanyhas any outstanding option,warrant, conversion or exchange privilege or other right,agreement, arrangement orcommitment obligating any such entity to issue or sell any share orownership,equity or voting interest of such entity or security or obligation of any kind convertible into or exchangeable or exercisable for any shares orownership,equityor voting interests of any such entity.Neither theCompanynor any of theCompany’s subsidiariesown any interest orinvestment (whether equity or debt) in any other person, other than aCompanysubsidiary,which interest orinvestmentismaterial to theCompanyits subsidiaries, taken as awhole |
| (b) | Authorization; Enforcement. (i)The Company has all requisite corporatepower and authority to enter into and perform thisAgreement, theNote and toconsummatethe transactionscontemplated hereby and thereby and to issue the Securities, in accordancewiththeterms hereof and thereof, (ii) the execution and delivery of thisAgreement, theNote bythe Company and theconsummation by it of the transactionscontemplated hereby and thereby (includingwithout limitation, the issuance of theNote and the issuance and reservation for issuance of theConversion Shares issuable upon conversion or exercise thereof) have been duly authorized by theCompany’s Board ofDirectorsand no further consent orauthorization of theCompany, itsBoardofDirectors, or its shareholders is required, (iii) thisAgreement has been duly executed and delivered by theCompany by its authorized representative,and such authorized representative is the true and official representativewithauthority to sign thisAgreement and the otherdocuments executed in connectionherewith and bind theCompanyaccordingly, and (iv) thisAgreement constitutes, and upon execution and delivery by theCompanyof theNote, each of suchinstruments will constitute, a legal, valid and binding obligation of theCompanyenforceable against theCompany in accordancewith itsterms. |
| (c) | Issuance of Shares.The Conversion Shares are duly authorized and reservedfor issuanceand, upon conversion of theNotein accordancewith its respectiveterms, will be validlyissued,fully paid andnon-assessable, and free from all taxes, liens,claims andencumbrances with respect to the issue thereof and shall not be subject topre-emptive |
rights or othersimilarrights of shareholders of theCompany andwillnotimpose personal liability upon the holder thereof.
| (d) | AcknowledgmentofDilution. The Company understands and acknowledges the potentially dilutive effect to theCommon Stock upon the issuance of theConversionShares upon conversion of theNote. The Companyfurtheracknowledges that its obligation to issueConversion Shares upon conversion of theNote in accordancewiththisAgreement and theNoteis absolute and unconditional regardless of the dilutive effect that such issuancemay have on theownershipinterests of other shareholders of theCompany. |
| (e) | NoConflicts. The execution, delivery andperformance of thisAgreement and the Note by theCompanyand theconsummation by theCompanyof the transactionscontemplated hereby and thereby (including,without limitation, the issuance and reservation for issuance of theConversionShares)will not (i) conflictwithor result in a violation of any provision ofthe Certificate of Incorporation orBy-laws,or (ii) violate or conflictwith, or result in a breach of any provision of, or constitute a default (or an eventwhich with notice or lapse oftime or both couldbecome a default) under, or give to others any rights oftermination, amendment, acceleration or cancellation of, anyagreement,indenture, patent, patent license orinstrumenttowhich theCompanyor any of its subsidiaries is a party, or (iii) result in a violation of anylaw,rule, regulation, order,judgment or decree (including federal and state securitieslawsand regulations and regulations of any self- regulatory organizations towhichtheCompany or its securities are subject) applicable to theCompany or any of its subsidiaries or bywhich any property or asset of theCompany or any of its subsidiaries is bound or affected (exceptfor such conflicts, defaults,terminations, amendments, accelerations, cancellations and violations aswould not, individually or in the aggregate, have amaterialadverse effect).All consents, authorizations, orders, filings and registrationswhich theCompany is required to obtain pursuant to the preceding sentence have been obtained or effected on or prior to the date hereof.The Companyis not in violation of the listingrequirements of theOTCPink orOTC Market Group (collectively, the“OTCP”) and does not reasonably anticipate that theCommon Stockwill be delisted by theOTCPin the foreseeable future, nor are theCompany’ssecurities “chilled” by the Financial IndustryRegulatory Authority (“FINRA”). The Company and its subsidiaries areunawareof any facts orcircumstances which mightgive rise to any of the foregoing. |
| (f) | AbsenceofLitigation. Except as disclosed in theCompany’spublic filings, there is noaction, suit,claim, proceeding, inquiry or investigation before or by any court, public board,governmentagency, self-regulatory organization or body pending or, to theknowledgeof theCompany or any of its subsidiaries, threatened against or affecting theCompanyor any of its subsidiaries, or their officers or directors in their capacity as such, that could have amaterial adverse effect. Schedule 3(f)[NTD -MAXDtocomplete Schedule] contains acomplete list andsummarydescription of any pending or, to theknowledgeof theCompany, threatened proceeding against or affecting theCompany or any of its subsidiaries,without regard towhetheritwould have amaterialadverse effect.The Company and its subsidiaries areunaware of any facts or circumstanceswhich might give rise to any of the foregoing. |
| (g) | Acknowledgment Regarding Buyer’ Purchase of Securities.The Company acknowledges and agrees that theBuyeris acting solely in the capacity ofarm’slength purchaserswith respect to thisAgreement and the transactionscontemplatedhereby.The Company furtheracknowledgesthat theBuyeris not acting as afinancialadvisor or fiduciary of theCompany(or in anysimilar capacity)withrespect to thisAgreement and the transactionscontemplated hereby and anystatement made by theBuyeror any of its respective representativesoragents in connection with thisAgreementand the transactions |
contemplatedhereby is not advice or arecommendation and ismerelyincidental to theBuyer’ purchase of the Securities.
| (h) | NoIntegratedOffering.Neither theCompany, nor any of its affiliates,nor any person acting on its or their behalf, has directly or indirectlymadeany offersor sales in any security or solicited any offers to buy any security undercircumstancesthatwould require registration under the 1933Act of the issuance of the Securities to theBuyer. The issuance of theSecuritiesto theBuyer will not be integratedwith any other issuance of theCompany’ssecurities (past, current or future) for purposes of any shareholder approval provisions applicable to theCompany or its securities. |
| (i) | Title to Property.The Company and its subsidiaries have good and marketable title in feesimple to all real property and good andmarketable title to all personal propertyowned by themwhich ismaterialto the business of theCompany and its subsidiaries, in each case free and clear of all liens,encumbrancesand defects except such as are described in Schedule 3(i)[NTD-MAXD tocomplete Schedule] or such aswould not have amaterial adverse effect.Anyreal property and facilities held under lease by theCompanyand its subsidiaries are held by them under valid, subsisting and enforceable leaseswith such exceptions aswould not have amaterial adverse effect. |
| (j) | IntellectualProperty. The Company or one of its subsidiariesowns,free and clear of all Liens, or has a valid right to use, all Intellectual Property(A) that covers the products presently sold or underdevelopment in the conduct of the business of theCompany oritssubsidiaries and(B) used or held for use in, or necessary to conduct, the business and operations of theCompanyand its subsidiaries as presently conducted. When usedherein, “Lien” shallmean any pledge, lien, charge, option, hypothecation,mortgage,security interest, adverse right, priorassignment,license, sublicense or any otherencumbranceof any kind or naturewhatsoever, whethercontingent or absolute, or anyagreement,option, rightor privilege(whetherbyLaw,contract orotherwise)capable ofbecoming any of the foregoing.When used herein,“Intellectual Property” shallmean all intellectual property andindustrial property rights and rights in confidentialinformation of every kind anddescription throughout theworld, including allUnited States, Canadian and foreign (a) patents, patent applications, invention disclosures, and all related continuations,continuations-in-part,divisionals, reissues,re-examinations, substitutions and extensions thereof(“Patents”),(b) registered or unregisteredtrademarks,servicemarks, names, corporatenames,tradenames, domain names, logos, slogans, trade dress, design rights, and othersimilardesignationsof source or origin, togetherwith thegoodwill symbolized by any of theforegoing (“Trademarks”),(c) copyrights and copyrightable subjectmatter (“Copyrights”), (d) rights incomputer programs (whether in source code, object code, or otherform), algorithms, databases,compilations and data, technology supporting the foregoing, and alldocumentation,including usermanuals and trainingmaterials, related to any of theforegoing (“Software”), (e) trade secrets and all other confidentialinformation, ideas,know-how,inventions, proprietary processes,formulae, models, and methodologies, (f) rights of publicity, privacy, and rights to personalinformation, (g)moralrights and rights ofattribution and integrity, (h) all rights in the foregoing and in othersimilarintangible assets and (i) all applications and registrations for the foregoing. |
| (k) | Investment Company. The Company is not an “investmentcompany”within the meaning of such term under theInvestment Company Act of 1940, asamended, and the rules and regulations of theSEC thereunder. |
| (l) | General Solicitation. Neither theCompany nor, to itsknowledge, any person acting on its behalf, has offered or sold any of the securitiescontemplatedin thisAgreement by any form of “general solicitation”within themeaningofRegulation D under the1933Act. |
| (m) | FormD andBlue Sky Filings. The Company agrees to file one ormore FormsD with theSEC and all required state securities agencies on atimely basis as required underRegulation D under the 1933Act and applicable state blue skylaws,rules and regulations. |
| (n) | Bad Actor. No officer or director of theCompanywould be disqualified under Rule 506(d) of theSecuritiesActasamended on the basis of being a "bad actor" as that term is established in theSeptember19, 2013Small Entity Compliance Guide published by the Securitiesand Exchange Commission. |
| (o) | Public Disclosure. The Company has timely filed allforms,reports, statements anddocuments, including financialstatements andmanagement’sdiscussion and analysis required to be filed by theCompanyunder applicable U.S. SecuritiesLaws andthe rules and policies of any applicable stock exchange or quotationsystem. None of thedocuments filed by or on behalf of theCompany on theEDGAR system, as of their respective dates (and, ifamendedor superseded by a filing prior to the date hereof, then on the date of such filing), contained any untruestatement of amaterialfact oromitted to state amaterialfact required to be stated therein or necessary tomakethestatements therein, in light of the circumstances underwhich theywere made, not misleading. |
| (p) | BreachofRepresentations andWarrantiesby theCompany.If theCompany breaches any of the representations orwarranties set forth in this Section 3, and in addition to any otherremediesavailable to the Buyer pursuant to thisAgreement,itwill be considered anEvent of default under theNote. |
| (a) | Expenses. At the Closing, theCompany shall reimburseBuyer for expenses incurred by them in connectionwith the negotiation, preparation, execution, delivery andperformanceof thisAgreement and the otheragreementsto be executed in connectionherewith (“Documents”),including,without limitation, reasonable attorneys’ and consultants’ fees and expenses, transfer agent fees, fees for stock quotation services, fees relating to anyamendmentsor modifications of theDocuments or any consents or waivers of provisions in theDocuments,fees for the preparation of opinions of counsel, escrow fees, and costs of restructuring the transactionscontemplated by theDocumentsin anamount of US$7,500.The Buyer will deduct these fees directly,otherwisetheCompany must make immediatepaymentforreimbursement to theBuyerfor all fees and expensesimmediately uponwritten notice by theBuyeror thesubmission of an invoice by theBuyer. The Holder may deduct all such fees and expenses from the Purchase Price of theNote when funded. |
| (b) | Listing.The Company shall promptly secure the listing of the Conversion Shares upon each national securities exchange orautomatedquotationsystem, if any, uponwhichsharesof Common Stock are then listed (subject to official notice of issuance) and, so long as theBuyer owns any of the Securities, shallmaintain,so long as any other shares ofCommon Stockshall be so listed, such listing of allConversion Shares fromtime totimeissuable upon conversion of theNote. The Company will obtainand, so long as theBuyer owns any of theSecurities, maintain the listing and trading of itsCommon Stock on theOTCP or any equivalentreplacement exchange, theNasdaq National Market (“Nasdaq”), theNasdaq SmallCap Market (“Nasdaq SmallCap”), theNew York Stock Exchange (“NYSE”), or theAmerican Stock Exchange (“AMEX”) andwill comply in all respectswith theCompany’sreporting, filing and other obligations under thebylawsor rules of theFINRA and such exchanges, as applicable.The Company shallpromptlyprovide to theBuyer copies ofanynotices it receives from theOTCP and any other exchanges or quotationsystems onwhich theCommonStock is then listed regarding the |
continued eligibility of theCommon Stock for listing on such exchanges and quotationsystems.
| (c) | Corporate Existence. So long as theBuyer beneficiallyowns any Note, theCompanyshall maintain its corporate existence and shall not sell all or substantially all of theCompany’s assets, except in the event of amerger or consolidation or sale of all or substantially all of theCompany’sassets,where the surviving or successor entity in such transaction (i)assumes theCompany’s obligations hereunder and under theagreements andinstrumentsentered into in connectionherewith and (ii) is a publicly traded corporationwhose Common Stock islisted for trading on theOTCP, Nasdaq, Nasdaq SmallCap, NYSE or AMEX. |
| (d) | NoIntegration.The Company shall notmake any offers orsalesof any security (other than the Securities) undercircumstancesthatwould require registration of the Securities being offered or sold hereunder under the 1933Actor cause the offering of the Securities tobeintegratedwith any other offering of securities by theCompany for the purpose ofany stockholder approval provision applicable to theCompany oritssecurities. |
| (e) | Information. The Buyer and its advisors, if any, have been, and for so long as the Note remain outstandingwillcontinue to be, furnishedwithallmaterialsrelating to the business, finances and operations of theCompanyandmaterials relating to the offer and sale of theSecurities which have been requested by theBuyer or its advisors and theCompany’s responses thereto have been andwill continue to be full, plain and true disclosure..The Buyerand its advisors, if any, have been, and for so long as theNote remainoutstandingwill continue to be, afforded the opportunity to ask questions of theCompany. |
| (f) | Public Disclosure. So long as theBuyer beneficiallyowns anyNoteorConversion Shares, theCompanyshalltimely file allforms,reports,statements anddocuments,including financial statements andmanagement’sdiscussion and analysis required to be filed by theCompanyunder applicable U.S. SecuritiesLaws and the rules and policies of anyapplicable stock exchange or quotationsystem. None of thedocuments filed by or on behalf of theCompany on theEDGAR system, as of their respective dates (and, ifamendedor superseded by a filing prior to the date hereof, then on the date of such filing), shall contain any untruestatement of amaterialfact oromitted to state amaterialfact required to be stated therein or necessary tomakethestatements therein, in light of thecircumstances underwhichtheywere made, not misleading. |
| (g) | UseofProceeds. The Company commits to utilize the proceeds from the sale of the Note to pay off its obligation toGS Capital andCrownbridgeso that the notesowed to such entities shall be paid in full. |
| (h) | BreachofCovenants.If theCompany breaches any of the covenants set forth in this Section 3, and in addition to any otherremediesavailable to theBuyerpursuant to thisAgreement,itwillbe considered an event of default under theNote. |
| 4. | Governing Law; Miscellaneous. |
| (a) | Governing Law. This Agreement shall be governed by and construed in accordancewiththelaws of theStateofNew York without regard to principles of conflicts oflaws. Any action brought by either party against the other concerning the transactionscontemplatedby thisAgreement shall be brought only in theState ofNew York. The parties to thisAgreement hereby irrevocablywaive any objection to jurisdiction and venue of any action instituted hereunder and shall not assert any defense based on lack of jurisdiction or venue or based upon forum non conveniens. In the event that any provision of thisAgreement or any otheragreement delivered in connectionherewithis invalid or unenforceable under any applicable statute or rule oflaw,then such provision shall bedeemed inoperative to the extent that it |
mayconflict therewith and shall bedeemed modified to conform with such statute or rule oflaw. Any such provisionwhich may prove
invalid or unenforceable under any law shall not affect the validity or enforceability of any other provision of anyagreement. Each party hereby irrevocablywaives personal serviceofprocess and consents to process being served in any suit, action or proceeding inconnection with thisAgreement or any otherTransaction Document bymailing a copy thereof via registered or certifiedmailor overnight delivery(with evidence of delivery) to such party at the address in effect for notices to it under thisAgreement and agrees that such service shall constitute good and sufficient service of process and notice thereof.Nothing contained herein shall bedeemed tolimit in anyway any right to serve process in any othermanner permitted bylaw.
| (b) | Counterparts;Signatures byFacsimile.ThisAgreement may be executed in one ormore counterparts, each ofwhichshall bedeemed an original but all ofwhich shall constitute one and thesame agreement and shallbecome effectivewhen counterparts have been signed by each party and delivered to the other party.This Agreement,once executed by a party,may be delivered to the other party hereto byfacsimile or other electronictransmission of a copyofthisAgreement bearing the signature of the party so delivering thisAgreement. |
| (c) | Headings. The headings of thisAgreement are for convenience of reference only and shall not form part of, or affect the interpretation of, thisAgreement. |
| (d) | Severability.In the event that any provision of thisAgreementis invalid or unenforceable under any applicable statute or rule oflaw,then such provision shall bedeemed inoperative to the extent that itmay conflicttherewith and shall bedeemed modified to conformwith such statute or rule oflaw. Any provision hereofwhich may prove invalid or unenforceable under any law shall not affect the validity or enforceability of any other provision hereof. |
| (e) | EntireAgreement; Amendments.ThisAgreement and the instruments referenced herein contain the entire understanding of the partieswithrespect to thematters covered hereinand therein and, except as specifically set forth herein or therein, neither theCompany nor theBuyer makes any representation,warranty,covenant or undertakingwith respect to such matters.No provision of thisAgreement may be waived oramended other than byan instrument inwritingsigned by themajority in interest of theBuyer. |
| (f) | Notices.All notices,demands, requests, consents, approvals, and other communications required orpermittedhereunder shall be inwriting and, unlessotherwise specified herein, shall be (i) personally served, (ii) deposited in themail,registered or certified, return receipt requested, postage prepaid, (iii) delivered by reputable air courier servicewith charges prepaid, (iv) via electronicmail or (v)transmitted by hand delivery,telegram,orfacsimile, addressed as set forth below or to such other address as such party shall have specifiedmostrecently bywritten notice.Anynotice or othercommunication required orpermitted to be given hereunder shall bedeemed effective (a) upon hand delivery or delivery byfacsimile, with accurateconfirmationgenerated by thetransmitting facsimile machine,at the address ornumber designated below (if delivered on a business day duringnormalbusiness hourswhere such notice is to be received) or delivery via electronicmail,or the first business day following such delivery (if delivered other than on a business day duringnormal business hourswhere such notice is to be received) or (b) on the second business day followingthe date ofmailing by express courier service, fully prepaid, addressed to such address, oruponactual receipt of suchmailing, whichevershall first occur.The addresses forsuch communications shallbe: |
If to theCompany,to:
MaxSoundCorporation.
8837Villa La JollaDrive, Unit 12109, La Jolla, California 92039
Attn:_J_o_h_nBla_isure
If to theBuyer:
BellridgeCapitalLP
515E. Las Olas Boulevard, Suite120A Fort Lauderdale, Florida 33301
Attn: Robert Klimov
Eachparty shall provide notice to the other party of any change inaddress.
| (g) | Successorsand Assigns. ThisAgreement shall be binding upon and inure to the benefit of the parties and their successors and assigns.Neither theCompanynor theBuyer shall assign thisAgreementor any rights or obligations hereunderwithoutthe priorwritten consent of the other.Notwithstanding the foregoing, theBuyer may assign its rights hereunder to anypersonthat purchases Securities in a private transaction from theBuyeror to any of its “affiliates,” as that term is defined under the 1933Act, without the consent of theCompany. |
| (h) | Third Party Beneficiaries. ThisAgreement is intended for the benefit of the parties hereto and their respectivepermittedsuccessors and assigns, and is not for the benefit of, normayany provision hereof be enforced by, any otherperson. |
| (i) | Survival.The representations and warranties of theCompany and the agreements and covenants set forth in thisAgreement shall survive the closing hereundernotwithstanding any due diligence investigation conducted by or on behalf of theBuyer. The Company agrees toindemnify and holdharmless theBuyerand all their officers, directors,employeesandagents for loss ordamagearising as a result of or related to anybreachor alleged breach by theCompany of any of its representations,warranties or covenants set forth in thisAgreement or any of its covenants or obligations under thisAgreement,includingadvancement ofexpensesas they are incurred. |
| (j) | Further Assurances. Each party shall do andperform,or cause to be done andperformed, all such further acts and things, and shall execute and deliver all such otheragreements,certificates,instruments anddocuments,as the other partymay reasonably request in order to carry out the intent andaccomplishthe purposes of thisAgreement and theconsummation of the transactionscontemplated hereby. |
| (k) | NoStrict Construction. The language used in thisAgreement will bedeemed to be the language chosen by the parties to express theirmutual intent, and no rules of strict constructionwill be applied against anyparty. |
| (l) | Remedies. The Company acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to theBuyer by vitiating the intent and purpose of thetransaction contemplatedhereby.Accordingly, theCompany acknowledges that theremedy at law for a breach of its obligations under thisAgreement will be inadequate and agrees, in the event of a breach or threatened breach by theCompany of the provisions of thisAgreement,thatthe Buyer shall be entitled, in addition to all other availableremedies at law or in equity, and in addition to the penalties assessable herein, to an injunction or injunctions restraining, preventing or curing any breach of thisAgreement |
and to enforce specifically theterms and provisions hereof,without the necessity ofshowing economic loss andwithoutany bond or other security being required.
INWITNESS WHEREOF, the undersignedBuyer and theCompanyhave caused thisAgreement to be duly executed as of the date first abovewritten.
Max Sound Corporation.
By: Name: JohnBlaisure Title:CEO
BELLRIDGE CAPITAL LP.
By: Name:RobertKlimov Title:ManagingPartner
AGGREGATE SUBSCRIPTION AMOUNT:
Aggregate Principal Amount ofNote: US$268,00000
Aggregate Purchase Price:US$239,060.00
Note:$268,000 less $21,440 inOID, less $7,500.00 in legal fees and other expenses.
EXHIBITA
144NOTE- $268,000
(attached)
Schedule3(f)
[♦]
Schedule3(i)
[♦]
