Exhibit 10.1
SECURITIES PURCHASE AGREEMENT
ThisSECURITIES PURCHASE AGREEMENT (the “Agreement”), dated as of December 10, 2014, by and betweenPOCKET GAMES, INC., a Florida corporation, withheadquarters located at 909 Plainview Avenue, Far Rockaway, Ny 11691 (the “Company”), andKBM WORLDWIDE, INC., a New York corporation, with its address at 80 Cuttermill Road,Suite 410, Great Neck, NY 11021 (the “Buyer”).
WHEREAS:
A.The Company and the Buyer are executing and delivering this Agreement inreliance upon the exemption from securities registration afforded by the rules and regulations aspromulgated by the United States Securities and Exchange Commission (the “SEC”) under theSecurities Act of 1933, as amended (the “1933 Act”);
B.Buyer desires to purchase and the Company desires to issue and sell, upon theterms and conditions set forth in this Agreement an 8% convertible note of the Company, in theform attached hereto as Exhibit A, in the aggregate principal amount of $33,000.00 (togetherwith any note(s) issued in replacement thereof or as a dividend thereon or otherwise with respectthereto in accordance with the terms thereof, the “Note”), convertible into shares of commonstock, $0.0001 par value per share, of the Company (the “Common Stock”), upon the terms andsubject to the limitations and conditions set forth in such Note.
C.The Buyer wishes to purchase, upon the terms and conditions stated in this Agreement, such principal amount of Note as is set forth immediately below its name on thesignature pages hereto; and
NOW THEREFORE, the Company and the Buyer severally (and not jointly) herebyagree as follows:
1.Purchase and Sale of Note.
a.Purchase of Note. On the Closing Date (as defined below), theCompany shall issue and sell to the Buyer and the Buyer agrees to purchase from the Companysuch principal amount of Note as is set forth immediately below the Buyer’s name on thesignature pages hereto.
b.Form of Payment. On the Closing Date (as defined below), (i) theBuyer shall pay the purchase price for the Note to be issued and sold to it at the Closing (as defined below) (the “Purchase Price”) by wire transfer of immediately available funds to theCompany, in accordance with the Company’s written wiring instructions, against delivery of theNote in the principal amount equal to the Purchase Price as is set forth immediately below the Buyer’s name on the signature pages hereto, and (ii) the Company shall deliver such dulyexecuted Note on behalf of the Company, to the Buyer, against delivery of such Purchase Price.
c.Closing Date. Subject to the satisfaction (or written waiver) of theconditions thereto set forth in Section 6 and Section 7 below, the date and time of the issuanceand sale of the Note pursuant to this Agreement (the “Closing Date”) shall be 12:00 noon, Eastern Standard Time on or about December 12, 2014, or such other mutually agreed upon time. The closing of the transactions contemplated by this Agreement (the “Closing”) shalloccur on the Closing Date at such location as may be agreed to by the parties.
2.Buyer’s Representations and Warranties. The Buyer represents and warrants to the Company that:
a.Investment Purpose. As of the date hereof, the Buyer ispurchasing the Note and the shares of Common Stock issuable upon conversion of or otherwise pursuant to the Note (including, without limitation, such additional shares of Common Stock, if any, as are issuable (i) on account of interest on the Note, (ii) as a result of the events describedin Sections 1.3 and 1.4(g) of the Note or (iii) in payment of the Standard Liquidated DamagesAmount (as defined in Section 2(f) below) pursuant to this Agreement, such shares of CommonStock being collectively referred to herein as the “Conversion Shares” and, collectively with theNote, the “Securities”) for its own account and not with a present view towards the public sale ordistribution thereof, except pursuant to sales registered or exempted from registration under the1933 Act;provided,however, that by making the representations herein, the Buyer does notagree to hold any of the Securities for any minimum or other specific term and reserves the right to dispose of the Securities at any time in accordance with or pursuant to a registration statementor an exemption under the 1933 Act.
b.Accredited Investor Status. The Buyer is an “accredited investor”as that term is defined in Rule 501(a) of Regulation D (an “Accredited Investor”).
c.Reliance on Exemptions. The Buyer understands that the Securities are being offered and sold to it in reliance upon specific exemptions from theregistration requirements of United States federal and state securities laws and that the Companyis relying upon the truth and accuracy of, and the Buyer’s compliance with, the representations,warranties, agreements, acknowledgments and understandings of the Buyer set forth herein inorder to determine the availability of such exemptions and the eligibility of the Buyer to acquirethe Securities.
d.Information. The Buyer and its advisors, if any, have been, and forso long as the Note remain outstanding will continue to be, furnished with all materials relatingto the business, finances and operations of the Company and materials relating to the offer andsale of the Securities which have been requested by the Buyer or its advisors. The Buyer and itsadvisors, if any, have been, and for so long as the Note remain outstanding will continue to be, afforded the opportunity to ask questions of the Company. Notwithstanding the foregoing, theCompany has not disclosed to the Buyer any material nonpublic information and will notdisclose such information unless such information is disclosed to the public prior to or promptlyfollowing such disclosure to the Buyer. Neither such inquiries nor any other due diligenceinvestigation
conducted by Buyer or any of its advisors or representatives shall modify, amend oraffect Buyer’s right to rely on the Company’s representations and warranties contained in Section 3 below. The Buyer understands that its investment in the Securities involves asignificant degree of risk. The Buyer is not aware of any facts that may constitute a breach of anyof the Company's representations and warranties made herein.
e.Governmental Review. The Buyer understands that no UnitedStates federal or state agency or any other government or governmental agency has passed uponor made any recommendation or endorsement of the Securities.
f.Transfer or Re-sale. The Buyer understands that (i) the sale or re-sale of the Securities has not been and is not being registered under the 1933 Act or anyapplicable state securities laws, and the Securities may not be transferred unless (a) the Securitiesare sold pursuant to an effective registration statement under the 1933 Act, (b) the Buyer shall have delivered to the Company, at the cost of the Buyer, an opinion of counsel that shall be inform, substance and scope customary for opinions of counsel in comparable transactions to theeffect that the Securities to be sold or transferred may be sold or transferred pursuant to an exemption from such registration, which opinion shall be accepted by the Company, (c) theSecurities are sold or transferred to an “affiliate” (as defined in Rule 144 promulgated under the1933 Act (or a successor rule) (“Rule 144”)) of the Buyer who agrees to sell or otherwise transfer the Securities only in accordance with this Section 2(f) and who is an AccreditedInvestor, (d) the Securities are sold pursuant to Rule 144, or (e) the Securities are sold pursuantto Regulation S under the 1933 Act (or a successor rule) (“Regulation S”), and the Buyer shallhave delivered to the Company, at the cost of the Buyer, an opinion of counsel that shall be in form, substance and scope customary for opinions of counsel in corporate transactions, whichopinion shall be accepted by the Company; (ii) any sale of such Securities made in reliance onRule 144 may be made only in accordance with the terms of said Rule and further, if said Rule isnot applicable, any re-sale of such Securities under circumstances in which the seller (or the person through whom the sale is made) may be deemed to be an underwriter (as that term isdefined in the 1933 Act) may require compliance with some other exemption under the 1933 Actor the rules and regulations of the SEC thereunder; and (iii) neither the Company nor any otherperson is under any obligation to register such Securities under the 1933 Act or any statesecurities laws or to comply with the terms and conditions of any exemption thereunder (in each case). Notwithstanding the foregoing or anything else contained herein to the contrary, theSecurities may be pledged as collateral in connection with abonafide margin account or otherlending arrangement.
g.Legends. The Buyer understands that the Note and, until such timeas the Conversion Shares have been registered under the 1933 Act may be sold pursuant to Rule144 or Regulation S without any restriction as to the number of securities as of a particular date that can then be immediately sold, the Conversion Shares may bear a restrictive legend in substantially the following form (and a stop-transfer order may be placed against transfer of thecertificates for such Securities):
“NEITHER THE ISSUANCE AND SALE OF THE SECURITIESREPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES AREEXERCISABLE HAVE BEEN REGISTERED UNDER THESECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLESTATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED(I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATIONSTATEMENT FOR THE SECURITIES UNDER THESECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINIONOF COUNSEL (WHICH COUNSEL SHALL BE SELECTED BY THE HOLDER), IN A GENERALLY ACCEPTABLE FORM,THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACTOR (II) UNLESS SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID ACT.NOTWITHSTANDING THEFOREGOING, THE SECURITIES MAY BE PLEDGED INCONNECTION WITH A BONA FIDE MARGIN ACCOUNT OROTHER LOAN OR FINANCING ARRANGEMENT SECUREDBY THE SECURITIES.”
The legend set forth above shall be removed and the Company shall issue a certificatewithout such legend to the holder of any Security upon which it is stamped, if, unless otherwiserequired by applicable state securities laws, (a) such Security is registered for sale under an effective registration statement filed under the 1933 Act or otherwise may be sold pursuant toRule 144 or Regulation S without any restriction as to the number of securities as of a particulardate that can then be immediately sold, or (b) such holder provides the Company with an opinionof counsel, in form, substance and scope customary for opinions of counsel in comparable transactions, to the effect that a public sale or transfer of such Security may be made withoutregistration under the 1933 Act, which opinion shall be accepted by the Company so that the saleor transfer is effected. The Buyer agrees to sell all Securities, including those represented by acertificate(s) from which the legend has been removed, in compliance with applicable prospectusdelivery requirements, if any. In the event that the Company does not accept the opinion ofcounsel provided by the Buyer with respect to the transfer of Securities pursuant to an exemptionfrom registration, such as Rule 144 or Regulation S, at the Deadline (as defined in the Note), itwill be considered an Event of Default pursuant to Section 3.2 of the Note.
h.Authorization; Enforcement. This Agreement has been duly and validly authorized. This Agreement has been duly executed and delivered on behalf of the Buyer, and this Agreement constitutes a valid and binding agreement of the Buyer enforceable in accordance with its terms.
i.Residency. The Buyer is a resident of the jurisdiction set forth immediately below the Buyer’s name on the signature pages hereto.
3.Representations and Warranties of the Company. The Company represents and warrants to the Buyer that:
a.Organization and Qualification. The Company and each of itsSubsidiaries (as defined below), if any, is a corporation duly organized, validly existing and ingood standing under the laws of the jurisdiction in which it is incorporated, with full power andauthority (corporate and other) to own, lease, use and operate its properties and to carry on its business as and where now owned, leased, used, operated and conducted. Schedule 3(a) sets forth a list of all of the Subsidiaries of the Company and the jurisdiction in which each is incorporated. The Company and each of its Subsidiaries is duly qualified as a foreigncorporation to do business and is in good standing in every jurisdiction in which its ownership oruse of property or the nature of the business conducted by it makes such qualification necessaryexcept where the failure to be so qualified or in good standing would not have a MaterialAdverse Effect.“Material Adverse Effect” means any material adverse effect on the business,operations, assets, financial condition or prospects of the Company or its Subsidiaries, if any,taken as a whole, or on the transactions contemplated hereby or by the agreements or instrumentsto be entered into in connection herewith. “Subsidiaries” means any corporation or otherorganization, whether incorporated or unincorporated, in which the Company owns, directly orindirectly, any equity or other ownership interest.
b.Authorization; Enforcement. (i) The Company has all requisite corporate power and authority to enter into and perform this Agreement, the Note and to consummate the transactions contemplated hereby and thereby and to issue the Securities, inaccordance with the terms hereof and thereof, (ii) the execution and delivery of this Agreement,the Note by the Company and the consummation by it of the transactions contemplated herebyand thereby (including without limitation, the issuance of the Note and the issuance andreservation for issuance of the Conversion Shares issuable upon conversion or exercise thereof)have been duly authorized by the Company’s Board of Directors and no further consent or authorization of the Company, its Board of Directors, or its shareholders is required, (iii) this Agreement has been duly executed and delivered by the Company by its authorized representative, and such authorized representative is the true and official representative withauthority to sign this Agreement and the other documents executed in connection herewith andbind the Company accordingly, and (iv) this Agreement constitutes, and upon execution anddelivery by the Company of the Note, each of such instruments will constitute, a legal, valid andbinding obligation of the Company enforceable against the Company in accordance with itsterms.
c.Capitalization. As of the date hereof, the authorized capital stockof the Company consists of: (i) 499,000,000 authorized shares of Common Stock, $0.0001 parvalue per share, of which 15,540,000 shares are issued and outstanding; and (ii) 1,000 authorizedshares of Series A shares of Preferred Stock, $0.0001 par value per share, of which 1,000 shares are issued and outstanding; no shares are reserved for issuance pursuant to the Company’s stockoption plans, no shares are reserved for issuance pursuant to securities (other than the Note andtwp (2) prior convertible promissory note(s) in favor of the Buyer:
(i) Prior convertible promissory note in favor of the Buyerdated October 6, 2014 in the amount of $48,000.00 for which 7,000,000 shares of CommonStock are presently reserved; and
(ii) Prior convertible promissory note in favor of the Buyerdated November 7, 2014 in the amount of $43,000.00 for which 7,000,000 shares of CommonStock are presently reserved; andexercisable for, or convertible into or exchangeable for shares of Common Stock and maintainpresent reserve of 14,000,000 shares for issuance upon conversion of the Note as well as the two(2) prior notes referenced above. All of such outstanding shares of capital stock are, or upon issuance will be, duly authorized, validly issued, fully paid and non-assessable. No shares ofcapital stock of the Company are subject to preemptive rights or any other similar rights of theshareholders of the Company or any liens or encumbrances imposed through the actions or failure to act of the Company. As of the effective date of this Agreement, (i) there are no outstanding options, warrants, scrip, rights to subscribe for, puts, calls, rights of first refusal,greements, understandings, claims or other commitments or rights of any character whatsoeverrelating to, or securities or rights convertible into or exchangeable for any shares of capital stockof the Company or any of its Subsidiaries, or arrangements by which the Company or any of its Subsidiaries is or may become bound to issue additional shares of capital stock of the Companyor any of its Subsidiaries, (ii) there are no agreements or arrangements under which the Companyor any of its Subsidiaries is obligated to register the sale of any of its or their securities under the1933 Act and (iii) there are no anti-dilution or price adjustment provisions contained in anysecurity issued by the Company (or in any agreement providing rights to security holders) thatwill be triggered by the issuance of the Note or the Conversion Shares. The Company hasfurnished to the Buyer true and correct copies of the Company’s Certificate of Incorporation asin effect on the date hereof (“Certificate of Incorporation”), the Company’s By-laws, as in effect on the date hereof (the “By-laws”), and the terms of all securities convertible into or exercisablefor Common Stock of the Company and the material rights of the holders thereof in respect thereto. The Company shall provide the Buyer with a written update of this representationsigned by the Company’s Chief Executive on behalf of the Company as of the Closing Date.
d.Issuance of Shares. The Conversion Shares are duly authorized and reserved for issuance and, upon conversion of the Note in accordance with its respectiveterms, will be validly issued, fully paid and non-assessable, and free from all taxes, liens, claimsand encumbrances with respect to the issue thereof and shall not be subject to preemptive rights or other similar rights of shareholders of the Company and will not impose personal liabilityupon the holder thereof.
e.Acknowledgment of Dilution. The Company understands and acknowledges the potentially dilutive effect to the Common Stock upon the issuance of the Conversion Shares upon conversion of the Note. The Company further acknowledges that its obligation to issue Conversion Shares upon conversion of the Note in accordance with this Agreement, the Note is absolute and unconditional regardless of the dilutive effect that suchissuance may have on the ownership interests of other shareholders of the Company.
f.No Conflicts. The execution, delivery and performance of thisAgreement, the Note by the Company and the consummation by the Company of the transactionscontemplated hereby and thereby (including, without limitation, the issuance and reservation forissuance of the Conversion Shares) will not (i) conflict with or result in a violation of any
provision of the Certificate of Incorporation or By-laws, or (ii) violate or conflict with, or result in a breach of any provision of, or constitute a default (or an event which with notice or lapse of time or both could become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, any agreement, indenture, patent, patent license or instrument to which the Company or any of its Subsidiaries is a party, or (iii) result in a violation of any law, rule, regulation, order, judgment or decree (including federal and state securities laws and regulations and regulations of any self-regulatory organizations to which theCompany or its securities are subject) applicable to the Company or any of its Subsidiaries or bywhich any property or asset of the Company or any of its Subsidiaries is bound or affected (except for such conflicts, defaults, terminations, amendments, accelerations, cancellations and violations as would not, individually or in the aggregate, have a Material Adverse Effect).Neither the Company nor any of its Subsidiaries is in violation of its Certificate of Incorporation,By-laws or other organizational documents and neither the Company nor any of its Subsidiaries is in default (and no event has occurred which with notice or lapse of time or both could put the Company or any of its Subsidiaries in default) under, and neither the Company nor any of itsSubsidiaries has taken any action or failed to take any action that would give to others any rightsof termination, amendment, acceleration or cancellation of, any agreement, indenture or instrument to which the Company or any of its Subsidiaries is a party or by which any property or assets of the Company or any of its Subsidiaries is bound or affected, except for possible defaults as would not, individually or in the aggregate, have a Material Adverse Effect. Thebusinesses of the Company and its Subsidiaries, if any, are not being conducted, and shall not beconducted so long as the Buyer owns any of the Securities, in violation of any law, ordinance or regulation of any governmental entity. Except as specifically contemplated by this Agreement and as required under the 1933 Act and any applicable state securities laws, the Company is not required to obtain any consent, authorization or order of, or make any filing or registration with,any court, governmental agency, regulatory agency, self regulatory organization or stock marketor any third party in order for it to execute, deliver or perform any of its obligations under thisAgreement, the Note in accordance with the terms hereof or thereof or to issue and sell the Notein accordance with the terms hereof and to issue the Conversion Shares upon conversion of theNote. All consents, authorizations, orders, filings and registrations which the Company isrequired to obtain pursuant to the preceding sentence have been obtained or effected on or priorto the date hereof. If the Company is listed on the OTCBB, the Company is not in violation ofthe listing requirements of the Over-the-Counter Bulletin Board (the “OTCBB”) and does notreasonably anticipate that the Common Stock will be delisted by the OTCBB in the foreseeablefuture. The Company and its Subsidiaries are unaware of any facts or circumstances whichmight give rise to any of the foregoing.
g.SEC Documents; Financial Statements. The Company has timely filed all reports, schedules, forms, statements and other documents required to be filed by it withthe SEC pursuant to the reporting requirements of the Securities Exchange Act of 1934, as amended (the “1934 Act”) (all of the foregoing filed prior to the date hereof and all exhibits included therein and financial statements and schedules thereto and documents (other than exhibits to such documents) incorporated by reference therein, being hereinafter referred toherein as the “SEC Documents”). Upon written request the Company will deliver to the Buyertrue and complete copies, as amended, of the SEC Documents, except for such exhibits and
incorporated documents. As of their respective dates, the SEC Documents complied in allmaterial respects with the requirements of the 1934 Act and the rules and regulations of the SECpromulgated thereunder applicable to the SEC Documents, and none of the SEC Documents, atthe time they were filed with the SEC, contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. None of the statements made in any such SEC Documents is, or has been, required to beamended or updated under applicable law (except for such statements as have been amended orupdated in subsequent filings prior the date hereof). As of their respective dates, the financialstatements of the Company included in the SEC Documents complied as to form in all material respects with applicable accounting requirements and the published rules and regulations of theSEC with respect thereto. Such financial statements have been prepared in accordance withUnited States generally accepted accounting principles, consistently applied, during the periodsinvolved and fairly present in all material respects the consolidated financial position of theCompany and its consolidated Subsidiaries as of the dates thereof and the consolidated results oftheir operations and cash flows for the periods then ended (subject, in the case of unauditedstatements, to normal year-end audit adjustments). Except as set forth in the financial statementsof the Company included in the SEC Documents, the Company has no liabilities, contingent orotherwise, other than (i) liabilities incurred in the ordinary course of business subsequent to July31, 2014, and (ii) obligations under contracts and commitments incurred in the ordinary courseof business and not required under generally accepted accounting principles to be reflected in such financial statements, which, individually or in the aggregate, are not material to thefinancial condition or operating results of the Company. The Company is subject to the reportingrequirements of the 1934 Act.
h.Absence of Certain Changes. Since July 31, 2014, there has been no material adverse change and no material adverse development in the assets, liabilities,business, properties, operations, financial condition, results of operations, prospects or 1934 Actreporting status of the Company or any of its Subsidiaries.
i.Absence of Litigation. There is no action, suit, claim, proceeding, inquiry or investigation before or by any court, public board, government agency, self-regulatoryorganization or body pending or, to the knowledge of the Company or any of its Subsidiaries, threatened against or affecting the Company or any of its Subsidiaries, or their officers or directors in their capacity as such, that could have a Material Adverse Effect. Schedule 3(i) contains a complete list and summary description of any pending or, to the knowledge of the Company, threatened proceeding against or affecting the Company or any of its Subsidiaries, without regard to whether it would have a Material Adverse Effect. The Company and its Subsidiaries are unaware of any facts or circumstances which might give rise to any of theforegoing.
j.Patents, Copyrights, etc. The Company and each of its Subsidiaries owns or possesses the requisite licenses or rights to use all patents, patent applications, patent rights, inventions, know-how, trade secrets, trademarks, trademarkapplications, service marks, service names, trade names and copyrights (“Intellectual Property”) necessary to enable it to conduct its business as now operated (and, as presently contemplated tobe operated in the future); there is no claim or action by any person pertaining to, or proceeding
pending, or to the Company’s knowledge threatened, which challenges the right of the Companyor of a Subsidiary with respect to any Intellectual Property necessary to enable it to conduct itsbusiness as now operated (and, as presently contemplated to be operated in the future); to the best of the Company’s knowledge, the Company’s or its Subsidiaries’ current and intendedproducts, services and processes do not infringe on any Intellectual Property or other rights heldby any person; and the Company is unaware of any facts or circumstances which might give riseto any of the foregoing. The Company and each of its Subsidiaries have taken reasonablesecurity measures to protect the secrecy, confidentiality and value of their Intellectual Property.
k.No Materially Adverse Contracts, Etc. Neither the Company norany of its Subsidiaries is subject to any charter, corporate or other legal restriction, or anyjudgment, decree, order, rule or regulation which in the judgment of the Company’s officers hasor is expected in the future to have a Material Adverse Effect. Neither the Company nor any of its Subsidiaries is a party to any contract or agreement which in the judgment of the Company’sofficers has or is expected to have a Material Adverse Effect.
l.Tax Status. The Company and each of its Subsidiaries has made orfiled all federal, state and foreign income and all other tax returns, reports and declarationsrequired by any jurisdiction to which it is subject (unless and only to the extent that the Companyand each of its Subsidiaries has set aside on its books provisions reasonably adequate for the payment of all unpaid and unreported taxes) and has paid all taxes and other governmental assessments and charges that are material in amount, shown or determined to be due on suchreturns, reports and declarations, except those being contested in good faith and has set aside onits books provisions reasonably adequate for the payment of all taxes for periods subsequent tothe periods to which such returns, reports or declarations apply. There are no unpaid taxes in anymaterial amount claimed to be due by the taxing authority of any jurisdiction, and the officers ofthe Company know of no basis for any such claim. The Company has not executed a waiverwith respect to the statute of limitations relating to the assessment or collection of any foreign,federal, state or local tax. None of the Company’s tax returns is presently being audited by anytaxing authority.
m.Certain Transactions. Except for arm’s length transactionspursuant to which the Company or any of its Subsidiaries makes payments in the ordinary courseof business upon terms no less favorable than the Company or any of its Subsidiaries could obtain from third parties and other than the grant of stock options disclosed on Schedule 3(c), none of the officers, directors, or employees of the Company is presently a party to any transaction with the Company or any of its Subsidiaries (other than for services as employees,officers and directors), including any contract, agreement or other arrangement providing for thefurnishing of services to or by, providing for rental of real or personal property to or from, or otherwise requiring payments to or from any officer, director or such employee or, to the knowledge of the Company, any corporation, partnership, trust or other entity in which anyofficer, director, or any such employee has a substantial interest or is an officer, director, trusteeor partner.
n.Disclosure. All information relating to or concerning the Companyor any of its Subsidiaries set forth in this Agreement and provided to the Buyer pursuant to Section 2(d) hereof and otherwise in connection with the transactions contemplated hereby is true and correct in all material respects and the Company has not omitted to state any material fact necessary in order to make the statements made herein or therein, in light of the circumstances under which they were made, not misleading. No event or circumstance hasoccurred or exists with respect to the Company or any of its Subsidiaries or its or their business,properties, prospects, operations or financial conditions, which, under applicable law, rule orregulation, requires public disclosure or announcement by the Company but which has not been so publicly announced or disclosed (assuming for this purpose that the Company’s reports filedunder the 1934 Act are being incorporated into an effective registration statement filed by theCompany under the 1933 Act).
o.Acknowledgment Regarding Buyer’ Purchase of Securities. TheCompany acknowledges and agrees that the Buyer is acting solely in the capacity of arm’s lengthpurchasers with respect to this Agreement and the transactions contemplated hereby. TheCompany further acknowledges that the Buyer is not acting as a financial advisor or fiduciary ofthe Company (or in any similar capacity) with respect to this Agreement and the transactions contemplated hereby and any statement made by the Buyer or any of its respectiverepresentatives or agents in connection with this Agreement and the transactions contemplatedhereby is not advice or a recommendation and is merely incidental to the Buyer’ purchase of theSecurities. The Company further represents to the Buyer that the Company’s decision to enterinto this Agreement has been based solely on the independent evaluation of the Company and itsrepresentatives.
p.No Integrated Offering. Neither the Company, nor any of itsaffiliates, nor any person acting on its or their behalf, has directly or indirectly made any offersor sales in any security or solicited any offers to buy any security under circumstances that wouldrequire registration under the 1933 Act of the issuance of the Securities to the Buyer. The issuance of the Securities to the Buyer will not be integrated with any other issuance of theCompany’s securities(past, current or future) for purposes of any shareholder approvalprovisions applicable to the Company or its securities.
q.No Brokers. The Company has taken no action which would give rise to any claim by any person for brokerage commissions, transaction fees or similar paymentsrelating to this Agreement or the transactions contemplated hereby.
r.Permits; Compliance. The Company and each of its Subsidiaries isin possession of all franchises, grants, authorizations, licenses, permits, easements, variances,exemptions, consents, certificates, approvals and orders necessary to own, lease and operate itsproperties and to carry on its business as it is now being conducted (collectively, the “CompanyPermits”), and there is no action pending or, to the knowledge of the Company, threatenedregarding suspension or cancellation of any of the Company Permits. Neither the Company norany of its Subsidiaries is in conflict with, or in default or violation of, any of the Company
Permits, except for any such conflicts, defaults or violations which, individually or in theaggregate, would not reasonably be expected to have a Material Adverse Effect. Since July 31,2014, neither the Company nor any of its Subsidiaries has received any notification with respectto possible conflicts, defaults or violations of applicable laws, except for notices relating topossible conflicts, defaults or violations, which conflicts, defaults or violations would not have aMaterial Adverse Effect.
s.Environmental Matters.
(i) There are, to the Company’s knowledge, with respect tothe Company or any of its Subsidiaries or any predecessor of the Company, no past or present violations of Environmental Laws (as defined below), releases of any material into the environment, actions, activities, circumstances, conditions, events, incidents, or contractualobligations which may give rise to any common law environmental liability or any liability under the Comprehensive Environmental Response, Compensation and Liability Act of 1980 or similar federal, state, local or foreign laws and neither the Company nor any of its Subsidiaries hasreceived any notice with respect to any of the foregoing, nor is any action pending or, to the Company’s knowledge, threatened in connection with any of the foregoing. The term “Environmental Laws” means all federal, state, local or foreign laws relating to pollution or protection of human health or the environment (including, without limitation, ambient air,surface water, groundwater, land surface or subsurface strata), including, without limitation, lawsrelating to emissions, discharges, releases or threatened releases of chemicals, pollutantscontaminants, or toxic or hazardous substances or wastes (collectively, “Hazardous Materials”)into the environment, or otherwise relating to the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of Hazardous Materials, as well as all authorizations, codes, decrees, demands or demand letters, injunctions, judgments, licenses, notices or notice letters, orders, permits, plans or regulations issued, entered, promulgated orapproved thereunder.
(ii)Other than those that are or were stored, used or disposedof in compliance with applicable law, no Hazardous Materials are contained on or about any realproperty currently owned, leased or used by the Company or any of its Subsidiaries, and no Hazardous Materials were released on or about any real property previously owned, leased orused by the Company or any of its Subsidiaries during the period the property was owned, leased or used by the Company or any of its Subsidiaries, except in the normal course of the Company’sor any of its Subsidiaries’ business.
(iii)There are no underground storage tanks on or under anyreal property owned, leased or used by the Company or any of its Subsidiaries that are not incompliance with applicable law.
t.Title to Property. The Company and its Subsidiaries have good and marketable title in fee simple to all real property and good and marketable title to all personal property owned by them which is material to the business of the Company and its
Subsidiaries, in each case free and clear of all liens, encumbrances and defects except such as aredescribed in Schedule 3(t) or such as would not have a Material Adverse Effect. Any real property and facilities held under lease by the Company and its Subsidiaries are held by themunder valid, subsisting and enforceable leases with such exceptions as would not have a MaterialAdverse Effect.
u.Insurance. The Company and each of its Subsidiaries are insuredby insurers of recognized financial responsibility against such losses and risks and in suchamounts as management of the Company believes to be prudent and customary in the businessesin which the Company and its Subsidiaries are engaged. Neither the Company nor any such Subsidiary has any reason to believe that it will not be able to renew its existing insurancecoverage as and when such coverage expires or to obtain similar coverage from similar insurersas may be necessary to continue its business at a cost that would not have a Material AdverseEffect. Upon written request the Company will provide to the Buyer true and correct copies ofall policies relating to directors’ and officers’ liability coverage, errors and omissions coverage,and commercial general liability coverage.
v.Internal Accounting Controls. The Company and each of itsSubsidiaries maintain a system of internal accounting controls sufficient, in the judgment of theCompany’s board of directors, to provide reasonable assurance that (i) transactions are executedin accordance with management’s general or specific authorizations, (ii) transactions arerecorded as necessary to permit preparation of financial statements in conformity with generallyaccepted accounting principles and to maintain asset accountability, (iii) access to assets ispermitted only in accordance with management’s general or specific authorization and (iv) therecorded accountability for assets is compared with the existing assets at reasonable intervals andappropriate action is taken with respect to any differences.
w.Foreign Corrupt Practices. Neither the Company, nor any of its Subsidiaries, nor any director, officer, agent, employee or other person acting on behalf of theCompany or any Subsidiary has, in the course of his actions for, or on behalf of, the Company,used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful expenses relating to political activity; made any direct or indirect unlawful payment to any foreign or domestic government official or employee from corporate funds; violated or is in violation of any provision of the U.S. Foreign Corrupt Practices Act of 1977, as amended, ormade any bribe, rebate, payoff, influence payment, kickback or other unlawful payment to anyforeign or domestic government official or employee.
x.Solvency. The Company (after giving effect to the transactionscontemplated by this Agreement) is solvent (i.e., its assets have a fair market value in excess ofthe amount required to pay its probable liabilities on its existing debts as they become absoluteand matured) and currently the Company has no information that would lead it to reasonablyconclude that the Company would not, after giving effect to the transaction contemplated by thisAgreement, have the ability to, nor does it intend to take any action that would impair its abilityto, pay its debts from time to time incurred in connection therewith as such debts mature. TheCompany did not receive a qualified opinion from its auditors with respect to its most recentfiscal year end and,
after giving effect to the transactions contemplated by this Agreement, doesnot anticipate or know of any basis upon which its auditors might issue a qualified opinion inrespect of its current fiscal year.
y.No Investment Company. The Company is not, and upon theissuance and sale of the Securities as contemplated by this Agreement will not be an “investment company” required to be registered under the Investment Company Act of 1940 (an “InvestmentCompany”). The Company is not controlled by an Investment Company.
z.Breach of Representations and Warranties by the Company. If theCompany breaches any of the representations or warranties set forth in this Section 3, and in addition to any other remedies available to the Buyer pursuant to this Agreement, it will beconsidered an Event of default under Section 3.4 of the Note.
4.COVENANTS.
a.Best Efforts. The parties shall use their best efforts to satisfytimely each of the conditions described in Section 6 and 7 of this Agreement.
b.Form D; Blue Sky Laws. Unless the Company believes it is exempt, the Company agrees to file a Form D with respect to the Securities as required underRegulation D and to provide a copy thereof to the Buyer promptly after such filing. Unless theCompany believes it is exempt, the Company shall, on or before the Closing Date, take suchaction as the Company shall reasonably determine is necessary to qualify the Securities for saleto the Buyer at the applicable closing pursuant to this Agreement under applicable securities or“blue sky” laws of the states of the United States (or to obtain an exemption from suchqualification), and shall provide evidence of any such action so taken to the Buyer on or prior tothe Closing Date.
c.Use of Proceeds. The Company shall use the proceeds for general working capital purposes.
d.[INTENTIONALLY DELETED].
e.Expenses. At the Closing, the Company shall reimburse Buyer forexpenses incurred by them in connection with the negotiation, preparation, execution, deliveryand performance of this Agreement and the other agreements to be executed in connection herewith (“Documents”), including, without limitation, reasonable attorneys’ and consultants’ fees and expenses, transfer agent fees, fees for stock quotation services, fees relating to anyamendments or modifications of the Documents or any consents or waivers of provisions in theDocuments, fees for the preparation of opinions of counsel, escrow fees, and costs of restructuring the transactions contemplated by the Documents. When possible, the Company must pay these fees directly, otherwise the Company must make immediate payment for reimbursement to the Buyer for all fees and expenses immediately upon written notice by theBuyer or the submission of an invoice by the Buyer. The Company’s obligation with respect tothis transaction is to reimburse Buyer’ expenses shall be $3,000.
f.Financial Information. Upon written request the Company agrees to send or make available the following reports to the Buyer until the Buyer transfers, assigns, orsells all of the Securities: (i) within ten (10) days after the filing with the SEC, a copy of itsAnnual Report on Form 10-K its Quarterly Reports on Form 10-Q and any Current Reports onForm 8-K; (ii) within one (1) day after release, copies of all press releases issued by the Company or any of its Subsidiaries; and (iii) contemporaneously with the making available or giving to the shareholders of the Company, copies of any notices or other information theCompany makes available or gives to such shareholders.
g.[INTENTIONALLY DELETED]
h.Listing. The Company shall promptly secure the listing of theConversion Shares upon each national securities exchange or automated quotation system, if any,upon which shares of Common Stock are then listed (subject to official notice of issuance) and,so long as the Buyer owns any of the Securities, shall maintain, so long as any other shares of Common Stock shall be so listed, such listing of all Conversion Shares from time to timeissuable upon conversion of the Note. The Company will obtain and, so long as the Buyer ownsany of the Securities, maintain the listing and trading of its Common Stock on the OTCBB orany equivalent replacement exchange or electronic quotation system (including but not limited tothe Pink Sheets electronic quotation system) and will comply in all respects with the Company’sreporting, filing and other obligations under the bylaws or rules of the Financial Industry Regulatory Authority (“FINRA”) and such exchanges, as applicable. The Company shallpromptly provide to the Buyer copies of any notices it receives from the OTCBB and any otherexchanges or electronic quotation systems on which the Common Stock is then traded regardingthe continued eligibility of the Common Stock for listing on such exchanges and quotationsystems.
i.Corporate Existence. So long as the Buyer beneficially owns anyNote, the Company shall maintain its corporate existence and shall not sell all or substantially allof the Company’s assets, except in the event of a merger or consolidation or sale of all or substantially all of the Company’s assets, where the surviving or successor entity in such transaction (i) assumes the Company’s obligations hereunder and under the agreements andinstruments entered into in connection herewith and (ii) is a publicly traded corporation whoseCommon Stock is listed for trading on the Pink Sheets, OTCQX, OTCBB, Nasdaq, NasdaqSmallCap, NYSE or AMEX.
j.No Integration. The Company shall not make any offers or salesof any security (other than the Securities) under circumstances that would require registration ofthe Securities being offered or sold hereunder under the 1933 Act or cause the offering of theSecurities to be integrated with any other offering of securities by the Company for the purposeof any stockholder approval provision applicable to the Company or its securities.
k.Breach of Covenants. If the Company breaches any of thecovenants set forth in this Section 4, and in addition to any other remedies available to the Buyerpursuant to this Agreement, it will be considered an event of default under Section 3.4 of theNote.
l.Failure to Comply with the 1934 Act. So long as the Buyer beneficially owns the Note, the Company shall comply with the reporting requirements of the 1934 Act; and the Company shall continue to be subject to the reporting requirements of the1934 Act.
m.Trading Activities. Neither the Buyer nor its affiliates has an open short position in the common stock of the Company and the Buyer agree that it shall not, and thatit will cause its affiliates not to, engage in any short sales of or hedging transactions with respectto the common stock of the Company.
5.Transfer Agent Instructions. The Company shall issue irrevocableinstructions to its transfer agent to issue certificates, registered in the name of the Buyer or itsnominee, for the Conversion Shares in such amounts as specified from time to time by the Buyerto the Company upon conversion of the Note in accordance with the terms thereof (the“Irrevocable Transfer Agent Instructions”). In the event that the Borrower proposes to replace its transfer agent, the Borrower shall provide, prior to the effective date of such replacement, afully executed Irrevocable Transfer Agent Instructions in a form as initially delivered pursuant tothe Purchase Agreement (including but not limited to the provision to irrevocably reserve shares ofCommon Stock in the Reserved Amount) signed by the successor transfer agent to Borrower and the Borrower. Prior to registration of the Conversion Shares under the 1933 Act or the date on which the Conversion Shares may be sold pursuant to Rule 144 without any restriction as tothe number of Securities as of a particular date that can then be immediately sold, all such certificates shall bear the restrictive legend specified in Section 2(g) of this Agreement. TheCompany warrants that: (i) no instruction other than the Irrevocable Transfer Agent Instructions referred to in this Section 5, and stop transfer instructions to give effect to Section 2(f) hereof (inthe case of the Conversion Shares, prior to registration of the Conversion Shares under the 1933Act or the date on which the Conversion Shares may be sold pursuant to Rule 144 without anyrestriction as to the number of Securities as of a particular date that can then be immediatelysold), will be given by the Company to its transfer agent and that the Securities shall otherwisebe freely transferable on the books and records of the Company as and to the extent provided inthis Agreement and the Note; (ii) it will not direct its transfer agent not to transfer or delay,impair, and/or hinder its transfer agent in transferring (or issuing)(electronically or in certificatedform) any certificate for Conversion Shares to be issued to the Buyer upon conversion of orotherwise pursuant to the Note as and when required by the Note and this Agreement; and (iii) itwill not fail to remove (or directs its transfer agent not to remove or impairs, delays, and/orhinders its transfer agent from removing) any restrictive legend (or to withdraw any stop transferinstructions in respect thereof) on any certificate for any Conversion Shares issued to the Buyer upon conversion of or otherwise pursuant to the Note as and when required by the Note and thisAgreement. Nothing in this Section shall affect in any way the Buyer’s obligations and agreement set forth in Section 2(g) hereof to comply with all applicable prospectus deliveryrequirements, if any, upon re-sale of the Securities. If the Buyer provides the Company, at thecost of the Buyer, with (i) an opinion of counsel in form, substance and scope customary foropinions in comparable transactions, to the effect that a public sale or transfer of such Securitiesmay be made without registration under the 1933 Act and such sale or transfer is effected or (ii) the Buyer provides reasonable assurances that
the Securities can be sold pursuant to Rule 144,the Company shall permit the transfer, and, in the case of the Conversion Shares, promptly instruct its transfer agent to issue one or more certificates, free from restrictive legend, in such name and in such denominations as specified by the Buyer. The Company acknowledges that abreach by it of its obligations hereunder will cause irreparable harm to the Buyer, by vitiating theintent and purpose of the transactions contemplated hereby. Accordingly, the Company acknowledges that the remedy at law for a breach of its obligations under this Section 5 may be inadequate and agrees, in the event of a breach or threatened breach by the Company of the provisions of this Section, that the Buyer shall be entitled, in addition to all other available remedies, to an injunction restraining any breach and requiring immediate transfer, without thenecessity of showing economic loss and without any bond or other security being required.
6.Conditions to the Company’s Obligation to Sell. The obligation of the Company hereunder to issue and sell the Note to the Buyer at the Closing is subject to thesatisfaction, at or before the Closing Date of each of the following conditions thereto, providedthat these conditions are for the Company’s sole benefit and may be waived by the Company atany time in its sole discretion:
a.The Buyer shall have executed this Agreement and delivered the same to the Company.
b.The Buyer shall have delivered the Purchase Price in accordance with Section 1(b) above.
c.The representations and warranties of the Buyer shall be true and correct in all material respects as of the date when made and as of the Closing Date as thoughmade at that time (except for representations and warranties that speak as of a specific date), andthe Buyer shall have performed, satisfied and complied in all material respects with thecovenants, agreements and conditions required by this Agreement to be performed, satisfied orcomplied with by the Buyer at or prior to the Closing Date.
d.No litigation, statute, rule, regulation, executive order, decree,ruling or injunction shall have been enacted, entered, promulgated or endorsed by or in any courtor governmental authority of competent jurisdiction or any self-regulatory organization havingauthority over the matters contemplated hereby which prohibits the consummation of any of thetransactions contemplated by this Agreement.
7.Conditions to The Buyer’s Obligation to Purchase. The obligation of theBuyer hereunder to purchase the Note at the Closing is subject to the satisfaction, at or before theClosing Date of each of the following conditions, provided that these conditions are for theBuyer’s sole benefit and may be waived by the Buyer at any time in its sole discretion:
a. The Company shall have executed this Agreement and delivered the same to the Buyer.
b. The Company shall have delivered to the Buyer the duly executedNote (in such denominations as the Buyer shall request) in accordance with Section 1(b) above.
c.The Irrevocable Transfer Agent Instructions, in form and substancesatisfactory to a majority-in-interest of the Buyer, shall have been delivered to and acknowledgedin writing by the Company’s Transfer Agent.
d.The representations and warranties of the Company shall be true and correct in all material respects as of the date when made and as of the Closing Date asthough made at such time (except for representations and warranties that speak as of a specificdate) and the Company shall have performed, satisfied and complied in all material respects withthe covenants, agreements and conditions required by this Agreement to be performed, satisfiedor complied with by the Company at or prior to the Closing Date. The Buyer shall have receiveda certificate or certificates, executed by the chief executive officer of the Company, dated as ofthe Closing Date, to the foregoing effect and as to such other matters as may be reasonablyrequested by the Buyer including, but not limited to certificates with respect to the Company’sCertificate of Incorporation, By-laws and Board of Directors’ resolutions relating to thetransactions contemplated hereby.
e.No litigation, statute, rule, regulation, executive order, decree,ruling or injunction shall have been enacted, entered, promulgated or endorsed by or in any courtor governmental authority of competent jurisdiction or any self-regulatory organization havingauthority over the matters contemplated hereby which prohibits the consummation of any of thetransactions contemplated by this Agreement.
f.No event shall have occurred which could reasonably be expectedto have a Material Adverse Effect on the Company including but not limited to a change in the1934 Act reporting status of the Company or the failure of the Company to be timely in its 1934Act reporting obligations.
g. The Conversion Shares shall have been authorized for quotation onthe OTCBB or PinkSheets and trading in the Common Stock on the OTCBB or PinkSheets shallnot have been suspended by the SEC or the OTCBB.
h. The Buyer shall have received an officer’s certificate described in Section 3(c) above, dated as of the Closing Date.
8.Governing Law; Miscellaneous.
a.Governing Law. This Agreement shall be governed by andconstrued in accordance with the laws of the State of New York without regard to principles ofconflicts of laws. Any action brought by either party against the other concerning the transactions contemplated by this Agreement shall be brought only in the state courts of New York or in the federal courts located in the state and county of Nassau. The parties to this
Agreement hereby irrevocably waive any objection to jurisdiction and venue of any action instituted hereunder and shall not assert any defense based on lack of jurisdiction or venue orbased uponforum non conveniens. The Company and Buyer waive trial by jury. The prevailingparty shall be entitled to recover from the other party its reasonable attorney's fees and costs. Inthe event that any provision of this Agreement or any other agreement delivered in connectionherewith is invalid or unenforceable under any applicable statute or rule of law, then such provision shall be deemed inoperative to the extent that it may conflict therewith and shall be deemed modified to conform with such statute or rule of law. Any such provision which mayprove invalid or unenforceable under any law shall not affect the validity or enforceability of anyother provision of any agreement. Each party hereby irrevocably waives personal service ofprocess and consents to process being served in any suit, action or proceeding in connection withthis Agreement or any other Transaction Document by mailing a copy thereof via registered orcertified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Agreement and agrees that such service shall constitute goodand sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by law.
b.Counterparts. This Agreement may be executed in one or morecounterparts, each of which shall be deemed an original but all of which shall constitute one andthe same agreement and shall become effective when counterparts have been signed by eachparty and delivered to the other party.
c.Headings. The headings of this Agreement are for convenience ofreference only and shall not form part of, or affect the interpretation of, this Agreement.
d.Severability. In the event that any provision of this Agreement isinvalid or unenforceable under any applicable statute or rule of law, then such provision shall bedeemed inoperative to the extent that it may conflict therewith and shall be deemed modified toconform with such statute or rule of law. Any provision hereof which may prove invalid orunenforceable under any law shall not affect the validity or enforceability of any other provisionhereof.
e.Entire Agreement; Amendments. This Agreement and theinstruments referenced herein contain the entire understanding of the parties with respect to the matters covered herein and therein and, except as specifically set forth herein or therein, neitherthe Company nor the Buyer makes any representation, warranty, covenant or undertaking withrespect to such matters. No provision of this Agreement may be waived or amended other than by an instrument in writing signed by the majority in interest of the Buyer.
f.Notices. All notices, demands, requests, consents, approvals, and other communications required or permitted hereunder shall be in writing and, unless otherwise specified herein, shall be (i) personally served, (ii) deposited in the mail, registered or certified, return receipt requested, postage prepaid, (iii) delivered by reputable air courier service with charges prepaid, or (iv) transmitted by hand delivery, telegram, or facsimile, addressed as set forth below or to such other address as such party shall have specified most recently by written
notice. Any notice or other communication required or permitted to be given hereunder shall bedeemed effective (a) upon hand delivery or delivery by facsimile, with accurate confirmation generated by the transmitting facsimile machine, at the address or number designated below (ifdelivered on a business day during normal business hours where such notice is to be received), orthe first business day following such delivery (if delivered other than on a business day during normal business hours where such notice is to be received) or (b) on the second business day following the date of mailing by express courier service, fully prepaid, addressed to such address, or upon actual receipt of such mailing, whichever shall first occur. The addresses forsuch communications shall be:
If to the Company, to:
POCKET GAMES, INC.
909 Plainview Avenue
Far Rockaway, Ny 11691
Attn: DAVID LOVATT, Chief Executive Officer facsimile: [enter fax number]
With a copy by fax only to (which copy shall not constitute notice):
[enter name of law firm]
Attn: [attorney name]
[enter address line 1]
[enter city, state, zip]
facsimile: [enter fax number]
If to the Buyer:
KBM WORLDWIDE, INC.
80 Cuttermill Road - Suite 410Great Neck, NY 11021
Attn: Seth Kramer, President
e-mail: info@kwbmlaw.com
With a copy by fax only to (which copy shall not constitute notice):
Naidich Wurman Birnbaum & Maday LLP
Attn: Judah A. Eisner, Esq.
Attn: Bernard S. Feldman, Esq.
facsimile: 516-466-3555
e-mail: dyork@nwbmlaw.com
Each party shall provide notice to the other party of any change in address.
g.Successors and Assigns. This Agreement shall be binding uponand inure to the benefit of the parties and their successors and assigns. Neither the Company northe Buyer shall assign this Agreement or any rights or obligations hereunder without the priorwritten
consent of the other. Notwithstanding the foregoing, subject to Section 2(f), the Buyermay assign its rights hereunder to any person that purchases Securities in a private transaction from the Buyer or to any of its “affiliates,” as that term is defined under the 1934 Act, withoutthe consent of the Company.
h.Third Party Beneficiaries. This Agreement is intended for thebenefit of the parties hereto and their respective permitted successors and assigns, and is not forthe benefit of, nor may any provision hereof be enforced by, any other person.
i.Survival. The representations and warranties of the Company andthe agreements and covenants set forth in this Agreement shall survive the closing hereunder notwithstanding any due diligence investigation conducted by or on behalf of the Buyer. The Company agrees to indemnify and hold harmless the Buyer and all their officers, directors,employees and agents for loss or damage arising as a result of or related to any breach or allegedbreach by the Company of any of its representations, warranties and covenants set forth in thisAgreement or any of its covenants and obligations under this Agreement, including advancementof expenses as they are incurred.
j.Publicity. The Company, and the Buyer shall have the right to review a reasonable period of time before issuance of any press releases, SEC, OTCBB or FINRA filings, or any other public statements with respect to the transactions contemplatedhereby;provided,however, that the Company shall be entitled, without the prior approval of theBuyer, to make any press release or SEC, OTCBB (or other applicable trading market) orFINRA filings with respect to such transactions as is required by applicable law and regulations(although the Buyer shall be consulted by the Company in connection with any such pressrelease prior to its release and shall be provided with a copy thereof and be given an opportunityto comment thereon).
k.Further Assurances. Each party shall do and perform, or cause tobe done and performed, all such further acts and things, and shall execute and deliver all such other agreements, certificates, instruments and documents, as the other party may reasonably request in order to carry out the intent and accomplish the purposes of this Agreement and theconsummation of the transactions contemplated hereby.
l.No Strict Construction. The language used in this Agreement willbe deemed to be the language chosen by the parties to express their mutual intent, and no rules ofstrict construction will be applied against any party.
m.Remedies. The Company acknowledges that a breach by it of itsobligations hereunder will cause irreparable harm to the Buyer by vitiating the intent and purposeof the transaction contemplated hereby. Accordingly, the Company acknowledges that theremedy at law for a breach of its obligations under this Agreement will be inadequate and agrees,in the event of a breach or threatened breach by the Company of the provisions of this Agreement, that the Buyer shall be entitled, in addition to all other available remedies 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 this Agreement and to enforce specifically the terms and provisions hereof, without the necessity of showing economic loss and without anybond or other security being required.
IN WITNESS WHEREOF, the undersigned Buyer and the Company have caused thisAgreement to be duly executed as of the date first above written.
POCKET GAMES, INC.
By:________________________________
DAVID LOVATT
Chief Executive Officer
KBM WORLDWIDE, INC.
By: _________________________________ Name: Seth Kramer
Title: President
80 Cuttermill Road - Suite 410 Great Neck, NY 11021
AGGREGATE SUBSCRIPTION AMOUNT:
Aggregate Principal Amount of Note: $33,000.00
Aggregate Purchase Price: $33,000.00
