Exhibit 2.1
SHARE EXCHANGE AGREEMENT
This Share Exchange Agreement, dated as of May 15, 2014 (this "Agreement"), is
by and between Empire Global Corp., a Delaware corporation with its principal
place of business at 000 Xxxxxxxxx Xx, Xxxxxxx, Xxxxxxx, X0X 0X0 ("EMGL" or
"Company"), and Giuseppe Xxx Xxxxxxxx, a business person with a principal
address at 000 Xxxxxxxxx Xxxxx, Xxxxxxxxx, Xxxxxxx Xxxxxx, X0X 0X0 Xxxxxxxxxx
Xxxxxxxx a business person with a principal address at Xxx Xxxxxxxxxx x. 0,
Xxxx, Xxxxx and Xxxxxxxxx Xxxxxxxxxx a business person with a principal address
at Via X. Xxxxxxxxxx, Rome, Italy (collectively the "Investors").
RECITALS
WHEREAS, the Investors are the record and beneficial owners, free and clear of
all liens and encumbrances of any kind whatsoever, of a 100% equity
interest in Multigame Enterprise Limited (the "Multigame Equity
Interest"), a corporation lawfully organized and currently existing
under the laws of Malta ("Multigame") with its registered office
situated at Xxxxxxxxxxx Xxxxxxxx Xxxxxx, Xxxxx 0, Xxxxx 0, 16th
September Square, Xxxxx, XXX 0000, Xxxxx;
WHEREAS, Multigame is the beneficial owner of a 70% equity interest in
Multigioco Srl., a corporation lawfully organized and currently
existing under the laws of the Republic of Italy ("Multigioco").
Multigioco is a gaming operator licensed by the Amministrazione
Autonoma Monopoli di Stato (AAMS) in the business of operating online
gaming shops and websites and land based betting corners and agencies
throughout Italy;
WHEREAS, Multigame will acquire the remaining 30% equity interest in Multigioco
in two equal disbursements at the end of year 2 and year 3 respectively
from the Closing Date;
WHEREAS, EMGL desires to acquire from the Investors the Multigame Equity
Interest, and the Investors desire to contribute to EMGL the Multigame
Equity Interest, each on the terms and subject to the conditions as set
forth in this Agreement;
WHEREAS, the Board of Directors of EMGL has determined that it is advisable and
in EMGL's best interests to effect an acquisition from Investors of the
Multigame Equity Interest on the terms and subject to the conditions as
set forth in this Agreement and such Board has approved and adopted the
terms and conditions of this Agreement; and
WHEREAS, the contribution to EMGL of the Multigame Equity Interest on the terms
and subject to the conditions as set forth in this Agreement has been
approved and authorized in accordance with the terms and conditions of
the Limited Liability Company Agreement of Investors and applicable
Maltese law.
NOW, THEREFORE, in consideration of the premises and of the mutual agreements,
representations, warranties and covenants herein contained, and other good and
valuable consideration, the receipt and adequacy is hereby acknowledged, the
parties to this Agreement do hereby agree as follows:
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ARTICLE I
DEFINITIONS
1.1 Definitions. Capitalized terms defined shall have the meanings set
forth in this Agreement.
ARTICLE II
CONTRIBUTION AND RECEIPT
2.1 Contribution and Receipt of Shareholder Shares. On the Closing Date (as
such capitalized terms is defined in section 8.1), in accordance with the
provisions of this Agreement and applicable law, the Investors will contribute,
assign, transfer and convey to EMGL, and EMGL will acquire and receive from the
Investors, the Multigame Equity Interest, free and clear of all liens and
encumbrances of any kind whatsoever (the "Exchange Transaction").
ARTICLE III
CONSIDERATION
3.1 Amount of Consideration. In consideration for the contribution,
assignment, transfer and conveyance of the Multigame Equity Interest to EMGL by
the Investors pursuant to section 2.1, EMGL shall issue, pay and deliver, at the
Closing (as such capitalized term is defined in section 8.1), such number of
shares (each, an "Exchange Share") of the common stock, par value $0.001 per
share of EMGL (the "EMGL Common Stock"), as shall equal 3,000,000 (three
million) or approximately 16% of the total number of shares of EMGL Common Stock
outstanding, on a Fully Diluted Basis (as such capitalized term is defined in
section 3.3) and shall pay directly to Multigioco:
a. at the Closing - Euro 750,000; and
b. on the first anniversary of the Closing - Euro 100,000 for each 10%
increase in Gross Gaming Revenue calculated from the Closing up to
a maximum of Euro 750,000; and
c. on the second anniversary of the Closing - a maximum Euro 750,000
payment for 15% of the remaining equity of Multigioco provided if
Multigioco earns consolidated EBITDA (as such capitalized term is
defined in section 3.2) equal to Euro 600,000; and
d. on the third anniversary of the Closing - a maximum Euro 750,000
payment for the final 15% equity of Multigioco provided if
Multigioco earns consolidated EBITDA equal to Euro 900,000.
For better clarity:
1. The total minimum Amount of Consideration as set out in this
section 3.1 payable by the Company in exchange for 100% of the
capital stock of both subsidiary entities Multigame Enterprise
Limited and Multigioco Srl, if earn-out performance described in
section 3.1 b; c; and d is not achieved is Euro 750,000 (Seven
Hundred and Fifty Euro Dollars) plus 3,000,000 shares of common
stock of EMGL.
2. The total maximum Amount of Consideration as set out in this
section 3.1 payable by the Company in exchange for 100% of the
capital stock of both subsidiary entities Multigame Enterprise
Limited and Multigioco Srl, if maximum earn-out performance
described in section 3.1 b; c; and d is achieved is Euro 3,000,000
(Three Million Euro Dollars) plus 3,000,000 shares of common stock
of EMGL.
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3.2 EBITDA Defined. For purposes of this Agreement, the capitalized term
"EBITDA" shall mean the net earnings before Interest, Income Tax, Depreciation
and Amortization of the consolidated operations of Multigioco calculated for
each twelve month period from the Closing date.
3.3 Fully Diluted Basis Defined. For purposes of this Agreement, the
capitalized term "FULLY DILUTED BASIS" shall mean the number of shares of EMGL
Common Stock that would be, as of the applicable date, outstanding if all
derivative securities of EMGL if any, including, without limitation, warrants,
options, rights, convertible debt, convertible securities and exchange
securities then outstanding were exercised, converted or exchanged for shares of
EMGL Common Stock in accordance with the terms of such derivative securities.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF INVESTORS
Investors represent, warrant and acknowledge to and covenants and agrees with
EMGL as follows:
4.1 Status; Authority. Investors have legal capacity to execute, deliver
and perform the Investors' obligations under this Agreement; and the
consummation of the transactions contemplated by this Agreement, including,
without limitation, the Exchange Transaction, have been duly authorized by all
necessary action on the part of the Investors and Multigioco's equity owners and
this Agreement constitutes the valid and legally binding obligation of the
Investors, enforceable against the Investors in accordance with its terms,
except as the same may be limited by bankruptcy, insolvency, reorganization or
other laws affecting the enforcement of creditors' rights generally now or
hereafter in effect and subject to the application of equitable principles and
the availability of equitable remedies;
4.2 Consents and Approvals, No Conflicts.
(a) The execution and delivery of this Agreement by Investors do not,
and the performance by the Investors of the Investors' obligations
under this Agreement will not, require any consent, approval,
authorization or other action by, or filing with or notification
to, any governmental or regulatory authority, except where failure
to obtain such consent, approval, authorization or action, or to
make such filing or notification, would not prevent the Investors
from performing any of Investors' material obligations under this
Agreement;
(b) The execution, delivery and performance of this Agreement by the
Investors and the other agreements to be executed, delivered and
performed by the Investors pursuant to this Agreement and the
consummation of the transactions contemplated hereby and thereby
by the Investors, including, without limitation, the Exchange
Transaction, do not and will not conflict with, violate or result
in a breach or termination of any provision of, or constitute a
default under any law, rule, regulation, order, writ, judgment,
injunction, decree, determination or award applicable to the
Investors or give to others any rights of termination, amendment,
acceleration or cancellation of, or result in the creation of any
lien or encumbrance on any of the assets or properties of the
Investors pursuant to, any note, bond, mortgage, indenture,
contract, agreement, lease, license, permit, franchise or other
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instrument relating to such assets or properties to which the
Investors are a party or by which any of such assets or properties
is bound, except as would not prevent the Investors from
performing any of the Investors' material obligations under this
Agreement and would not have a Material Adverse Effect (as such
capitalized term is defined in section 10.15) on the Investors or
the Investors' assets;
4.3 Investment Intent. The Investors are acquiring the Exchange Shares for
the Investors' own account, for investment only and not with a view to, or for
sale in connection with, a distribution thereof or any part thereof, within the
meaning of the Securities Act of 1933, as amended (the "Securities Act"), and
the rules and regulations promulgated thereunder, or any applicable state
securities or blue-sky laws;
4.4 Investor Status. The Investors are each an accredited investor as such
term is defined under Regulation D ("Regulation D") promulgated under to the
Securities Act; and, if there should be any material change in such status prior
to the Closing, Investors will immediately advise EMGL of such change in
accredited investor status;
4.5 Intent to Transfer. The Investors are each not a party or subject to or
bound by any contract, undertaking, agreement or arrangement with any person to
sell, transfer or pledge the Exchange Shares or any part thereof to any person,
and has no present intention to enter into such a contract, undertaking,
agreement or arrangement;
4.6 Receipt of Disclosures. Investors acknowledge receipt of EMGL's (a)
Annual Report on Form 10-K for the fiscal year ended December 31, 2013,
including all exhibits thereto, (b) Quarterly Reports on Forms 10-Q for the
quarters ended March 31, June 30, and September 30, 2013 and March 31, 2014
including all exhibits thereto, (c) all Current Reports on Form 8-K filed up to
the date of Closing, including all exhibits thereto, and (d) Annual Report on
Form 10-K for the fiscal year ended December 31, 2012, including all exhibits
thereto; each as filed with the U.S. Securities and Exchange Commission (the
"SEC") (collectively, the "EMGL SEC Reports"); and Investors has read the EMGL
SEC Reports, including all exhibits thereto, and understands the contents of the
EMGL SEC Reports;
4.7 Offering Exempt from Registration; EMGL's Reliance. The Investors have
been advised by EMGL that:
(i) the Exchange Shares have not been registered under the Securities
Act or under the laws of any state on the basis that the issuance
thereof is exempt from such registration;
(ii) EMGL's reliance on the availability of such exemption is, in
part, based upon the accuracy and truthfulness of the Investors'
representations contained in this Agreement;
(iii) as a result of such lack of registration, none of the Exchange
Shares may be resold or otherwise transferred or disposed without
registration pursuant to or an exemption therefrom is available
under the Securities Act and such state securities laws; and
(iv) in furtherance of the provisions of this paragraph 4.7, all of
the certificate(s) representing the Exchange Shares shall bear a
restrictive legend substantially in the following form:
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"THE SHARES OF COMMON STOCK REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THESE SHARES HAVE
BEEN ACQUIRED FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO DISTRIBUTION
OR RESALE, AND MAY NOT BE SOLD, ASSIGNED, PLEDGED, HYPOTHECATED OR
OTHERWISE TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT FOR SUCH
SHARES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND APPLICABLE STATE
SECURITIES LAWS OR AN OPINION OF COUNSEL SATISFACTORY TO THE ISSUER OF
THESE SHARES TO THE EFFECT THAT REGISTRATION IS NOT REQUIRED UNDER SUCH ACT
AND SUCH STATE SECURITIES LAWS;"
4.8 Sophistication of Investors. The Investors, through each of their
agents, employees and professional advisors (including, without limitation, the
Investors' attorneys and outside accountants), has evaluated the merits and
risks of consummating the transactions contemplated by this Agreement,
including, without limitation, the Exchange Transaction, and acquiring the
Exchange Shares and has such knowledge and experience in financial and business
matters that Investors is capable of evaluating the merits and risks of
consummating such transactions, including, without limitation, the Exchange
Transaction, and acquiring the Exchange Shares, is aware of and has considered
the financial risks and financial hazards of consummating such transactions,
including, without limitation, the Exchange Transaction, and acquiring the
Exchange Shares, and is able to bear the economic risk of consummating such
transactions, including, without limitation, the Exchange Transaction, and
acquiring the Exchange Shares, including the possibility of a complete loss with
respect thereto;
4.9 Access to Information. The Investors have had access to such
information regarding the business and finances of EMGL, and has been provided
the opportunity to discuss with EMGL's management the business, affairs and
financial condition of EMGL and such other matters with respect to EMGL as would
concern a reasonable person considering the transactions contemplated by this
Agreement and/or concerned with the operation of EMGL, including, without
limitation, pursuant to meetings and/or discussions with management of EMGL;
4.10 No Guarantees. It has never been represented, guaranteed or warranted
to the Investors by EMGL, or any of EMGL's officers, directors, agents,
representatives or employees, or any other person, expressly or by implication,
that:
(i) any gain will be realized by the Investors from the Investors'
investment in the Exchange Shares;
(ii) there will be any approximate or exact length of time that the
Investors will be required to remain as a holder of the Exchange
Shares; or
(iii) the past performance or experience on the part of EMGL, its
predecessors or of any other person, will in any way indicate any
future results of EMGL;
4.11 High Degree of Investment Risk. That the acquisition of the Exchange
Shares involves a high degree of risk and may result in a loss of the entire
amount invested; that EMGL has limited working capital and limited sources of
financing available; and that there is no assurance that EMGL's operations,
including the operations of Multigame following the consummation of the Exchange
Transaction, will be profitable in the future;
4.12 Address and Principal Place of Business. The address set forth at the
beginning of this Agreement are the Investors' true and correct addresses and
principal places of business, respectively, and the Investors have no present
intention of changing his individual or collective jurisdiction or principal
place of business;
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4.13 No Purchaser Representative. The Investors have not authorized any
person or institution to act as the Investors' "purchaser representative" (as
such term is defined in Rule 501 of Regulation D) in connection with the
Investors' acquisition of the Exchange Shares pursuant to this Agreement;
4.14 No General Solicitation. The Investors have not received any general
solicitation or general advertising regarding the acquisition of any of the
Exchange Shares;
4.15 No Finder. There is no finder in connection with the transactions
contemplated by this Agreement;
4.16 Multigame Equity Interest. The Investors are the lawful owners of and
have the full right, power, and authority to sell, assign, transfer and convey
to EMGL all of the Multigame Equity Interest free and clear of all liens,
encumbrances, claims or rights of every kind and nature whatsoever in accordance
with the terms of this Agreement and the sale, assignment, transfer and
conveyance of the Multigame Equity Interest in accordance with the terms of this
Agreement will transfer good, valid and marketable title thereto free and clear
of all liens, encumbrances, claims or rights of every kind and nature
whatsoever;
4.17 Valid Issuance. The Multigame Equity Interest has been duly authorized,
is validly issued and outstanding, is fully paid for and non-assessable, and no
liability attaches to the holders of the Multigame Equity Interest. The
Multigame Equity Interest is owned by the Investors free and clear of any and
all restrictions, liens, claims, or encumbrances or rights of third parties of
any nature whatsoever; there are no existing options, warrants, calls, or
commitments on the part of the Investors (or, to the best knowledge of the
Investors, any other person or entity) of any character relating to the
Multigame Equity Interest; and no voting agreements or restrictions of any kind
affect the rights of any of the Multigame Equity Interest or the holders of all
or any portion of the Multigame Equity Interest;
4.18 Litigation. As of the date hereof, there is no action, claim, suit,
proceeding or governmental investigation pending or, to the knowledge of the
Investors, threatened, that would, individually or in the aggregate, result in a
Material Adverse Effect upon the Investors and/or Multigame.
4.19 Compliance with Law. Except as would not, individually or in the
aggregate, have a Material Adverse Effect upon the Investors and/or Multigame,
neither the Investors, Multigame, nor any of their respective heirs, assigns or
subsidiaries is in violation of, or in default under, any law, in each case,
applicable to the Investors and/or Multigame or any of their respective
subsidiaries or any of their respective assets and properties;
4.20 Multigioco Srl Agreement.
(a) The Acquisition Agreement, dated December 12, 2013, between,
Xxxxxxxxxx Xxxxxxxx and Xxxxxxxxx Xxxxxxxxxx ("Multigioco
Partners") and Giuseppe Xxx Xxxxxxxx ("Xxxxxxxx") (the "Multigioco
Acquisition Agreement"), was duly executed and entered into by the
Multigioco Partners and Xxxxxxxx (collectively the "Investors");
(b) The Multigioco Acquisition Agreement is a valid and binding
obligation of the Investors, enforceable against the Investors
and, to the Investors' knowledge, each other party thereto in
accordance with its terms, is in full force and effect and the
Investors have performed in all material respects all obligations
under the Multigioco Acquisition Agreement to be performed by the
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Investors to the date of this Agreement; and, to Multigioco
Partners knowledge, each other party to the Multigioco Acquisition
Agreement has performed in all material respects all obligations
under such contract required to be performed by such other party;
and
(c) Neither Xxxxxxxx nor the Multigioco Partners have received notice,
and Multigioco Partners have no knowledge, of any material
violation of or default of any material obligation under (or any
condition which with the passage of time or the giving of notice
would cause such a violation of or default under) the Multigioco
Acquisition Agreement by Xxxxxxxx or any other party to the
Multigioco Acquisition Agreement.
4.21 Subsidiaries. Other than Multigioco Srl, Multigame has no subsidiaries,
nor does Multigame have any equity interest in any other entity of any kind
whatsoever;
4.22 Full Disclosure. The representations, warranties and other statements
of the Investors in this Article IV and the other documents, certificates and
written statements furnished to EMGL by or on behalf of the Investors pursuant
to this Agreement, taken as a whole, do not contain any untrue statement of a
material fact or omit to state a material fact specific to the Investors'
business, plans, results of operations and/or financial condition, and not
generally available to a sophisticated acquirer of a business similar in nature
to the actual and planned business operations of the Investors, necessary in
order to make the representations, warranties and other statements of the
Investors contained in this Agreement or such other documents, certificates and
written statements not misleading; and
4.23 No Other Representations, Warranties, Covenants or Agreements of
Investors. Except as set forth in this Agreement, or the documents referred to
in this Agreement, the Investors have not made any representation, warranty,
covenant or agreement with respect to the matters contained in this Agreement.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF EMGL
EMGL represents, warrants and acknowledges to and covenants and agrees with the
Investors as follows:
5.1 Corporate Status. EMGL
(i) is a corporation duly organized, validly existing and in good
standing under the laws of the State of Delaware,
(ii) has all necessary corporate power and authority to carry on the
business of EMGL as it is now being conducted, and
(iii) is duly licensed or qualified and in good standing as a foreign
corporation authorized to do business in each jurisdiction
wherein the character and/or the nature of the activities
conducted by EMGL makes such licensing or qualification
necessary, except where the failure to be so licensed or
qualified and in good standing would not prevent EMGL from
performing any of its material obligations under this Agreement
and would not have a Material Adverse Effect on EMGL;
5.2 Authority of Agreement. EMGL has the power and authority to accept,
execute and deliver this Agreement and, upon acceptance by the Investors, to
carry out EMGL's obligations under this Agreement; and the execution, delivery
and performance by EMGL of this Agreement and the consummation of the
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transactions contemplated by this Agreement have been duly authorized by all
necessary corporate action on the part of EMGL and this Agreement, upon
acceptance by the Investors, constitutes the valid and legally binding
obligations of EMGL enforceable against EMGL in accordance with its terms,
except as the same may be limited by bankruptcy, insolvency, reorganization or
other laws affecting the enforcement of creditors' rights generally now or
hereafter in effect and subject to the application of equitable principles and
the availability of equitable remedies; each of the Exchange Shares to be issued
pursuant to this Agreement, upon issuance in accordance with the terms of this
Agreement, will be validly authorized, fully paid and non-assessable;
5.3 Consents and Approvals; No Conflict.
(a) The acceptance, execution and delivery of this Agreement by EMGL
does not, and the performance by EMGL of its obligations under
this Agreement, upon acceptance by the Investors, will not,
require any consent, approval, authorization or other action by,
or filing with or notification to, any governmental or regulatory
authority, other than in connection with state securities or "blue
sky" laws, except where failure to obtain such consent, approval,
authorization or action, or to make such filing or notification,
would not prevent EMGL from performing any of its material
obligations under this Agreement and would not have a Material
Adverse Effect on EMGL; and
(b) The acceptance, execution, delivery and performance of this
Agreement by EMGL and the other agreements and documents to be
executed, delivered and performed by EMGL pursuant to this
Agreement and the consummation of the transactions contemplated by
this Agreement and thereby by EMGL do not and will not conflict
with, violate or result in a breach or termination of any
provision of, or constitute a default under (or event which with
the giving of notice or lapse of time, or both, would become a
default under) the Certificate of Incorporation or By-laws of EMGL
or, except as would not prevent EMGL from performing any of its
material obligations under this Agreement and would not have a
Material Adverse Effect on EMGL, any law, rule, regulation, order,
writ, judgment, injunction, decree, determination or award
applicable to EMGL or give to others any rights of termination,
amendment, acceleration or cancellation of, or result in the
creation of any lien or encumbrance on any of the assets or
properties of EMGL pursuant to, any note, bond, mortgage,
indenture, contract, agreement, lease, license, permit, franchise
or other instrument relating to such assets or properties to which
EMGL is a party or by which any of such assets or properties is
bound;
5.4 Absence of Litigation. No claim, action, proceeding or investigation is
pending which seeks to delay or prevent the consummation of the transactions
contemplated by this Agreement or which would be reasonably likely to adversely
affect EMGL's ability to consummate the transactions contemplated by this
Agreement or which would have a Material Adverse Effect on EMGL;
5.5 Extent of Offering. Subject in part to the truth and accuracy of the
Investors' representations set forth in Article IV of this Agreement, the offer,
sale and issuance of the Exchange Shares, as contemplated by this Agreement, are
exempt from the registration requirements of the Securities Act, and EMGL will
not take any action hereafter that would cause the loss of such exemption or
registration;
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5.6 Accuracy of Reports and Information. EMGL is in full compliance, to the
extent applicable, with all reporting obligations under Section 12(b), 12 (g) or
15(d), as applicable, of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"); EMGL has registered the EMGL Common Stock pursuant to
Section 12 of the Exchange Act; and EMGL has filed all material required to be
filed pursuant to all reporting obligations, under either Section 13(a) or 15(d)
of the Exchange Act, for a period of at least the twelve months immediately
preceding the offer, sale and delivery of the Exchange Shares.
5.7 SEC Filings/Full Disclosure. None of the EMGL SEC Reports contain any
untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading; and EMGL has,
since at least January 1, 2014, timely filed all requisite forms, reports and
exhibits thereto with the Commission; and there is no fact known to EMGL (other
than general economic conditions known to the public generally) that has not
been disclosed in writing to the Investors which could reasonably be expected to
materially and adversely affect the ability of EMGL to perform its obligations
under this Agreement;
5.8 Absence of Undisclosed Liabilities. EMGL has no material liabilities or
obligations, absolute or contingent (individually or in the aggregate), except
as set forth in the EMGL SEC Reports, including the financial statements
included in the SEC Reports (collectively, the "EMGL Financial Statements"), or
as incurred in the ordinary course of business after the respective dates of the
EMGL Financial Statements;
5.9 Governmental Consent, Etc. No consent, approval or authorization of or
designation, declaration or filing with any governmental authority on the part
of EMGL is required in connection with the valid execution and delivery of this
Agreement, or the offer, sale or issuance of the Exchange Shares, or the
consummation of any other transaction contemplated by this Agreement;
5.10 Investment Intent. EMGL is acquiring the Multigame Equity Interest for
EMGL's own account, for investment only and not with a view to, or for sale in
connection with, a distribution thereof or any part thereof, within the meaning
of the Securities Act, and the rules and regulations promulgated thereunder, or
any applicable state securities or blue-sky laws;
5.11 Access to Information. EMGL has had access to such information
regarding the business and finances of the Investors and Multigame, and has been
provided the opportunity to discuss with the Investors and Multigame management
the business, affairs and financial condition of the Investors and Multigame and
such other matters with respect to the Investors and Multigame as would concern
a reasonable person considering the transactions contemplated by this Agreement,
including, without limitation, the Exchange Transaction, and/or concerned with
the operations of the Investors and Multigame, including, without limitation,
pursuant to meetings and/or discussions with management of Multigioco; and
5.12 No Other Representations, Warranties, Covenants or Agreements of EMGL.
Except as set forth in this Agreement, or the documents referred to in this
Agreement, EMGL has not made any representation, warranty, covenant or agreement
with respect to the matters contained in this Agreement.
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ARTICLE VI
CONDITIONS TO OBLIGATIONS OF EMGL
The obligations of EMGL under this Agreement are, at the option of EMGL, subject
to the satisfaction at and prior to the Closing Date of the following
conditions:
6.1 Fulfillment of Covenants. All the terms, covenants and conditions of
this Agreement to be complied with and performed by the Investors on or before
the Closing Date shall have been duly complied with and performed, and there
shall have been delivered to EMGL a certificate to such effect dated the Closing
Date, signed by the Investors and the President and Secretary of Multigame;
6.2 Accuracy of Representations and Warranties. All of the representations
and warranties made by the Investors in this Agreement shall be true as of the
Closing Date with the same force and effect as though such representations and
warranties had been made as of the Closing Date, and Investors shall have
delivered to EMGL a certificate to such effect, dated the Closing Date, and
signed by the President and Secretary of Multigame;
6.3 No Litigation. There shall be no action, proceeding, investigation or
pending or actual litigation the purpose of which is to enjoin or may be to
enjoin the transactions contemplated by this Agreement or which would have the
effect, if successful, of imposing a material liability upon EMGL, or any of the
officers or directors thereof, because of or due to, in many respects, the
consummation of the transactions contemplated by this Agreement; and there shall
be no action, proceeding, investigation or pending or actual litigation against
or with respect to the Investors, Multigame or the outstanding equity interests
in Multigame (including, without limitation, the Multigame Equity Interest)
which could, in any way, invalidate or damage this Agreement or value of the
assets which EMGL is acquiring pursuant to this Agreement, including, without
limitation, the Multigame Equity Interest; and
6.4 Multigioco Srl Contracts in Effect. The Multigioco Acquisition
Agreement shall be in full force and effect and no party to the Multigioco
Acquisition Agreement shall be in default under, or shall have threatened to
declare or cause a default of any of the terms or conditions of, the Multigioco
Acquisition Agreement.
ARTICLE VII
CONDITIONS TO OBLIGATIONS OF INVESTORS
The obligations of the Investors under this Agreement are, at the option of the
Investors subject to the satisfaction at and prior to the Closing Date of the
following conditions:
7.1 Fulfillment of Covenants. All the terms, covenants and conditions of
this Agreement to be complied with and performed by EMGL on or before the
Closing Date shall have been duly complied with and performed, and there shall
have been delivered to the Investors a certificate to such effect dated the
Closing Date, signed by the Chairman and Chief Executive Officer of EMGL;
7.2 Accuracy of Representations and Warranties. All of the representations
and warranties made by EMGL in this Agreement shall be true as of the Closing
Date with the same force and effect as though such representations and
warranties had been made as of the Closing Date, and EMGL shall have delivered
to the Investors a certificate to such effect dated the Closing Date, signed by
the Chairman and Chief Executive Officer of EMGL;
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7.3 No Litigation. There shall be no action, proceeding, investigation or
pending or actual litigation the purpose of which is to enjoin or may be to
enjoin the transactions contemplated by this Agreement or which would have the
effect, if successful, of imposing a material liability upon the Investors
because of or due to, in many respects, the consummation of the transactions
contemplated by this Agreement; and there shall be no action, proceeding,
investigation or pending or actual litigation against or with respect to EMGL,
the outstanding shares of EMGL Common Stock or the Exchange Shares which could,
in any way, invalidate or damage this Agreement or value of the assets which the
Investors are acquiring pursuant to this Agreement;
7.4 EMGL Outstanding Debt. As of the Closing Date, EMGL shall have no more
than $275,000 in outstanding debt, including, without limitation, notes payable,
accounts payable, accrued expenses, accrued officer's compensation and loans
payable to related parties to loans from shareholders, excluding the Investors
Advances (as such capitalized term is defined in section 10.1);
7.5 EMGL Outstanding and Authorized Capital Stock. Prior to the Closing
EMGL shall have no more than 18,675,800 shares of Common Stock issued and
outstanding and no Preferred Stock issued. As a consequence of the consummation
of this Agreement at the Closing, EMGL shall have no more than 21,675,800 shares
of Common Stock issued and outstanding and no Preferred Stock issued; and
7.6 Resignation of Directors and Officers. Consistent with applicable law,
EMGL shall (a) procure, prior to the Effective Time (as such capitalized term is
defined in section 8.2), the resignations of Xxxxxxx Xxxxxxxxxx as Chairman and
CEO and Xxx Xxxxxxxxx as a director of EMGL which shall be effective as of the
Effective Time and (b) cause the board of directors of EMGL, prior to the
effectiveness of such resignations and prior to the Closing Date, to (i) elect
to the board of directors of EMGL, effective as of the Effective Time, such
individuals as shall be designated by Investors at least three business days
prior to the Closing Date and (ii) appoint as officers of EMGL, effective as of
the Effective Time, such individuals as shall be designated by the Investors at
least three business days prior to the Closing Date.
ARTICLE VIII
CLOSING
8.1 Closing Date. The consummation of the transactions contemplated by this
Agreement (the "CLOSING") shall take place at EMGL's office, 000 Xxxxxxxxx Xx.,
Xxxxxxx, Xxxxxxx, Xxxxxx, X0X 0X0 on June 30, 2014 or sooner if practicable and
as may be mutually agreed upon in writing by the parties to this Agreement
defined in section 10.3 (the "CLOSING DATE").
8.2 Effectiveness. The time of the consummation of the Exchange
Transaction, whether on the Closing Date or such other date, shall, for the
purposes of this Agreement, be deemed to be the "EFFECTIVE TIME."
ARTICLE IX
INDEMNIFICATION
9.1 Right of Indemnification. From and after the date hereof, each party
hereto will indemnify and hold harmless the other party, and such other party's
officers, directors, equity owners, employees and agents, against any and all
liability, damage, deficiency, loss, cost or expense (including reasonable
attorneys' fees and expenses) that are based upon or that arise out of any
misrepresentation or breach of any representation, warranty, covenant or
agreement made by such party in this Agreement.
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9.2 Indemnification Procedure. Each party entitled to indemnification under
this Agreement (the "Indemnified Party") shall give prompt notice to the party
(the "Indemnifying Party") required to provide indemnification under this
Agreement after such Indemnified Party has received actual knowledge of any
third-party claim as to which indemnity may be sought, and shall permit the
Indemnifying Party (at Indemnifying Party's expense) to assume the defense of
any claim or any litigation resulting therefrom; provided, that counsel for the
Indemnifying Party who shall conduct the defense of such claim or litigation
shall be reasonably satisfactory to the Indemnified Party, and the Indemnified
Party may participate in such defense, but only at such Indemnified Party's
expense; and provided, further, that the omission by any Indemnified Party to
give prompt notice as provided in this Article IX shall not relieve the
Indemnifying Party of its indemnification obligations under this Agreement,
except to the extent that the omission results in a failure of actual prompt
notice to the Indemnifying Party and such Indemnifying Party is damaged as a
result of the failure to give prompt notice. No Indemnifying Party, in the
defense of the such claim or litigation, shall, except with the consent of each
Indemnified Party, consent to entry of any judgment or enter into any settlement
which does not include as an unconditional term thereof the giving by the
claimant or plaintiff to such Indemnified Party of a release from all liability
with respect to such claim or litigation. In the event that the Indemnifying
Party does not accept the defense of any matter as provided in this section 9.2,
the Indemnified Party shall have the full right to defend against any such claim
or demand, and shall be entitled to settle or agree to pay in full such claim or
demand in the Indemnified Party's sole discretion. In any event, the Indemnified
Party, Indemnifying Party, EMGL and the Investors shall each cooperate in the
defense of such action and the records of each shall be available to the other
with respect to such defense.
9.3 Indemnification Notice. Any notice of a claim by reason of any of the
representations, warranties and agreements contained in this Agreement, shall
state specifically the representation, warranty, covenant or agreement with
respect to which the claim is made and the amount of liability asserted against
the other party by reason of the claim. The representations, warranties,
covenants, agreements and indemnities contained in this Agreement shall survive
the execution and delivery of this Agreement, any examination by or on behalf of
such parties, the Closing and the completion of the Exchange Transaction as
contemplated herein.
ARTICLE X
GENERAL
10.1 Payment of Expenses. Each party shall bear its own expenses with
respect to this Agreement and the transactions contemplated by this Agreement.
Notwithstanding the immediately preceding sentence, it is acknowledged by both
EMGL and the Investors that the Investors, or affiliates of the Investors, have,
on behalf of EMGL, paid to the law firm of Locasciulli Studio Legale attorneys
("LSL"), the sum of $10,000 (the "Investors/LSL Advance") to be applied against
LSL's fees for services rendered in connection with the preparation of the
Multigioco Acquisition Agreement, without limitation any related matters, and,
to the extent that such fees are less than $10,000, to outstanding fees owed to
LSL by EMGL. In addition, the Investors, or affiliates of the Investors, have,
on behalf of EMGL, paid to other service providers to and vendors of EMGL, the
aggregate sum of $25,000 (the "Investors/Other Vendors Advance" and,
collectively with the Investors/LSL Advance, the "Investors Advances"). In the
event that the Exchange Transaction is not consummated on or prior to June 30,
2014, due to any reason other than a willful failure on the part of the
Investors or any affiliate(s) of the Investors, then the Investors Advances
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shall be deemed a loan made by the Investors to EMGL, which shall bear interest
at the rate of 5% per annum and be due and payable on June 30, 2015. In the
event that the Investors shall, in the Investors' sole discretion, advance any
additional funds to or for the benefit of EMGL at anytime prior to the Closing,
such additional funds shall be deemed a part of the Investors Advances and
subject to repayment as all other Investors Advances are subject to repayment in
accordance with this section 10.1.
10.2 Consent to Jurisdiction and Waivers. The parties to this Agreement each
irrevocably consents that any legal action or proceeding against any of them
under, arising out of or in any manner relating to, this Agreement or any other
document delivered in connection herewith, may be brought in any court of the
State of Delaware located within Wilmington County or in the United States
District Court for the District of Wilmington. Each of the parties to this
Agreement, by the execution and delivery of this Agreement, expressly and
irrevocably consent and submit to the personal jurisdiction of any of such
courts in any such action or proceeding. Each party further irrevocably consents
to the service of any complaint, summons, notice or other process relating to
any such action or proceeding by delivery thereof to it by hand or by any other
manner provided for in section 10.4. The parties hereto hereby expressly and
irrevocably waive any claim or defense in any such action or proceeding based on
any alleged lack of personal jurisdiction, improper venue or forum
non-convenient or any similar basis. Nothing in this section 10.2 shall affect
or impair in any manner or to any extent the right of any party to this
Agreement to serve process in any manner permitted by law.
10.3 Amendments and Waivers.
(a) Except as otherwise provided in this Agreement, the provisions of
this Agreement may not be amended, modified or supplemented
without the written consent of each of the parties to this
Agreement.
(b) The Company and the Investors' may each, by written notice to the
other party:
(i) waive any of the conditions to such party's obligations
under this Agreement or extend the time for the performance
of any of the obligations or actions of the other party,
(ii) waive any inaccuracies in the representations of the other
party contained in this Agreement or in any documents
delivered pursuant to this Agreement,
(iii) waive compliance with any of the covenants of the other
party contained in this Agreement, and
(iv) waive or modify performance of any of the obligations of the
other party.
(c) No action taken pursuant to this Agreement, including, without
limitation, any investigation by or on behalf of any party, shall
be deemed to constitute a waiver by the party taking such action
or compliance with any representation, warranty, condition or
agreement contained herein. Waiver of the breach of any one or
more provisions of this Agreement shall not be deemed or construed
to be a waiver of other breaches or subsequent breaches of the
same provisions.
10.4 Notices. All notices, demands, requests, demands and other
communications required or otherwise given under this Agreement shall be in
writing and shall be deemed to have been duly given if: (i) delivered by hand,
against written receipt therefor, (ii) forwarded by a third party company or
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governmental entity providing delivery services in the ordinary course of
business which guarantees delivery the following business day, or (iii) mailed
by registered or certified mail, return receipt requested, postage prepaid,
addressed (with respect to clauses (ii) and (iii)) as follows:
If to EMGL, to: Xxxxxxx Xxxxxxxxxx, Chairman and CEO
Empire Global Corp.
000 Xxxxxxxxx Xx.
Xxxxxxx, Xxxxxxx, Xxxxxx X0X 0X0
With copy to: Xxxxxx X. Xxxxxxx, ESQ
Masters and Associates
0000 Xxxxxxxxxx Xxxx,
XxXxxxx, Xxxxxxxxxx 00000
If to Investors, to: Giuseppe Xxx Xxxxxxxx
000 Xxxxxxxxx Xxxxx
Xxxxxxxxx, Xxxxxxx, Xxxxxx X0X 0X0
With copy to: Xxxxxx X. Xxxxx, LLB
Xxxxx Winter, LLP
000 Xxxxxxxx Xx. Xxxx, Xxxxx 000
Xxxxxxx, Xxxxxxx, Xxxxxx X0X 0X0
or, in the case of any of the parties to this Agreement, at such other address
as such party shall have furnished to each of the other parties hereto in
accordance with this section 10.4. Each such notice, demand, request or other
communication shall be deemed given (a) on the date of such delivery by hand,
(b) on the first business day following the date of such delivery to the
overnight delivery service or (c) four business days following such mailing.
10.5 Successors and Assigns: Holders and Third Parties as Beneficiaries.
This Agreement shall inure to the benefit of and be binding upon the parties
hereto and their respective successors and assigns.
10.6 Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement. Electronic, fax, PDF and
Jpeg signatures to this Agreement shall be deemed to be original signatures to
this Agreement.
10.7 Headings. The headings of the articles, sections, paragraphs and
clauses in this Agreement are for convenience of reference only and shall not
limit or otherwise affect the meanings or interpretations of the terms contained
therein.
10.8 Governing Law. This Agreement and the rights, obligations and
liabilities of the parties hereto shall be governed by and construed and
interpreted in accordance with the laws of the State of Delaware without regard
to the conflicts of laws principles thereof.
10.9 Severability; Specific Enforcement. In the event that any one or more
of the provisions contained in this Agreement, or the application thereof in any
circumstances, is held invalid, illegal, or unenforceable for any reason, the
validity, legality and enforceability of any such provision in every other
respect and of the remaining provisions contained in this Agreement shall not be
in any way impaired thereby, it being intended that all of the rights and
privileges of the parties to this Agreement shall be enforceable to the fullest
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extent permitted by law. Each of the parties to this Agreement acknowledge that
the other parties would not have an adequate remedy at law for money damages in
the event that any of the covenants or agreements of any other party in this
Agreement were not performed in accordance with its terms and therefore agrees
that the other parties shall be entitled to specific enforcement of such
covenants or agreements and to injunctive and other equitable relief in addition
to any other remedy to which it may be entitled, at law or in equity.
10.10 Entire Agreement; Survival. This Agreement and the agreements referred
to in this Agreement are intended by the parties as a final expression of their
agreements and are intended to be a complete and exclusive statement of the
agreements and understandings of the parties to this Agreement in respect of the
subject matter contained in this Agreement and therein. There are no
restrictions, promises, representations, warranties or undertakings, with
respect to the subject matter of this Agreement, other than those set forth or
referred to in this Agreement and therein. This Agreement and the agreements
referred to in this Agreement supersede all prior agreements and understandings
between the parties with respect to such subject matters.
10.11 Binding Nature. This Agreement shall be binding upon and inure to the
benefit of the parties hereto. No party to this Agreement may assign or transfer
any rights under this Agreement.
10.12 Use of Certain Terms and References. The words "hereof," "herein" and
"hereunder" and words of similar import when used in this Agreement shall refer
to this Agreement as a whole and not to any particular provision of this
Agreement; the term "or" shall be deemed to include the term "and/or;" singular
or plural tenses shall be deemed to include the opposite whenever the context so
indicates or requires; and article, section, subsection, paragraph, clause,
schedule and exhibit references are to this Agreement unless otherwise
specified.
10.13 Drafting; Representation by Counsel. This Agreement has been drafted
on the basis of mutual contribution of language and is not to be construed
against any party as being the drafter or causing the same to be drafted. In
addition to the representations and warranties contained in Article IV, the
Investors represents, warrants and confirms to EMGL that, in connection with the
negotiation, drafting and execution of this Agreement, the Investors have at all
times been represented by competent counsel of the Investors' own choosing.
10.14 Business Day. For purposes of this Agreement, a "business day" shall
mean any calendar day other than a Saturday, Sunday or other calendar day on
which banks in New York City are authorized or required to be closed under
applicable laws and regulations.
10.15 Material Adverse Effect Defined. For purposes of this Agreement, the
capitalized term "MATERIAL ADVERSE EFFECT" means, with respect to either party
to this Agreement, any material adverse change in, or material adverse effect
on, the business, financial condition or continuing operations of such party
(which, for the purposes of this section 10.15, includes all subsidiaries of the
party, taken as a whole); provided, however, that the effects of changes that
are generally applicable to (i) the industries and markets in which the party
operates, (ii) the United States economy or (iii) the United States securities
markets shall be excluded from the determination of Material Adverse Effect; and
provided, further, however, that any change or effect resulting from (A) the
execution of this Agreement, the announcement of this Agreement or the pendency
or consummation of the transactions contemplated by this Agreement (including
any cancellation of or delays in customer orders or work for clients, any
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reductions in sales, any disruption in licensor, vendor, partner or similar
relationships or any loss of employees), (B) natural disasters, acts of war,
terrorism or sabotage, military actions or the escalation thereof or other force
majeure events, (C) changes in US GAAP, changes in the interpretation of US GAAP
or changes in the accounting rules and regulations of the SEC, (D) any other
action required by law, contemplated by this Agreement or taken at the request
of the other party, (E) any litigation brought or threatened by equity owners of
the party asserting allegations of breach of fiduciary duty relating to this
Agreement or violations of applicable securities laws in connection with this
Agreement, (F) any changes in applicable law, (G) any action required to comply
with the rules and regulations of the SEC or the SEC comment process, (H) if
EMGL was the party, in and of itself, any decrease in the market price or
trading volume of EMGL Common Stock or (I) if EMGL was the party, in and of
itself, any failure by EMGL to meet any projections, forecasts or revenue or
earnings predictions, or any predictions or expectations of any securities
analysts, shall also be excluded from the determination of Material Adverse
Effect.
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of
the date first above written.
EMPIRE GLOBAL CORP.
By: /s/ Xxxxxxx Xxxxxxxxxx, X.Xx.
----------------------------
Xxxxxxx Xxxxxxxxxx, X.Xx.
Chairman and CEO
And
INVESTORS
By: /s/ Giuseppe Xxx Xxxxxxxx
----------------------------
Giuseppe Xxx Xxxxxxxx
By: /s/ Xxxxxxxxxx Xxxxxxxx
----------------------------
Xxxxxxxxxx Xxxxxxxx
By: /s/ Xxxxxxxxx Xxxxxxxxxx
----------------------------
Xxxxxxxxx Xxxxxxxxxx
