EQUITY PURCHASE AGREEMENT
This equity purchase agreement is entered into as of November 10, 2021 (this "Agreement"), by and between GZ6G Technologies Corp., a Nevada corporation (the "Company"),
and Mast Hill Fund, L.P., a Delaware limited partnership (the "Investor").
WHEREAS, the parties desire that, upon the terms and subject to the conditions contained herein, the Company shall issue and sell to the Investor, from time to time as provided herein, and
the Investor shall purchase up to Ten Million Dollars ($10,000,000.00) of the Company’s Common Stock (as defined below);
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE I
Section 1.1 DEFINED
TERMS. As used in this Agreement, the following terms shall have the following meanings specified or indicated (such meanings to be equally applicable to both the singular and plural forms of the terms defined):
"Agreement"
shall have the meaning specified in the preamble hereof.
“Average
Daily Trading Value” shall mean the average trading volume of the Company’s Common Stock on the Principal Market in the seven (7) Trading Days immediately preceding the respective Put Date multiplied by the lowest volume weighted
average price of the Company’s Common Stock on the Principal Market in the seven (7) Trading Days immediately preceding the respective Put Date.
“Bankruptcy
Law” means Title 11, U.S. Code, or any similar federal or state law for the relief of debtors.
"Claim
Notice" shall have the meaning specified in Section 9.3(a).
“Clearing
Costs” shall mean all fees of the Placement Agent with respect to the transactions contemplated by this Agreement, as well as all of the Investor’s brokerage firm, clearing firm, Transfer Agent fees, and attorney fees, with respect
to the issuance and deposit of the Put Shares.
“Clearing
Date” shall be the date on which the Investor receives the Put Shares in its brokerage account.
"Closing"
shall mean one of the closings of a purchase and sale of shares of Common Stock pursuant to Section 2.3.
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"Closing
Certificate" shall mean the closing certificate of the Company in the form of Exhibit B hereto.
“Closing
Date” shall mean the date of any Closing hereunder.
"Commitment
Period" shall mean the period commencing on the Execution Date, and ending on the earlier of (i) the date on which the Investor shall have purchased Put Shares pursuant to this Agreement equal to the Maximum Commitment Amount, (ii)
twenty four (24) months after the date of this Agreement, (iii) written notice of termination by the Company to the Investor (which shall not occur during any Valuation Period or at any time that the Investor holds any of the Put Shares), (iv) the
Registration Statement is no longer effective after the initial effective date of the Registration Statement, or (v) the date that, pursuant to or within the meaning of any Bankruptcy Law, the Company commences a voluntary case or any Person
commences a proceeding against the Company, a Custodian is appointed for the Company or for all or substantially all of its property or the Company makes a general assignment for the benefit of its creditors; provided, however, that the provisions
of Articles III, IV, V, VI, IX and the agreements and covenants of the Company and the Investor set forth in Article X shall survive the termination of this Agreement.
"Common
Stock" shall mean the Company's common stock, $0.001 par value per share, and any shares of any other class of common stock whether now or hereafter authorized, having the right to participate in the distribution of dividends (as and
when declared) and assets (upon liquidation of the Company).
“Common
Stock Equivalents” means any securities of the Company or the Subsidiaries which would entitle the holder thereof to acquire at any time Common Stock, including, without limitation, any debt, preferred stock, right, option, warrant
or other instrument that is at any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive, Common Stock.
"Company"
shall have the meaning specified in the preamble to this Agreement.
“Custodian”
means any receiver, trustee, assignee, liquidator or similar official under any Bankruptcy Law.
"Damages"
shall mean any loss, claim, damage, liability, cost and expense (including, without limitation, reasonable attorneys' fees and disbursements and costs and expenses of expert witnesses and investigation).
"Dispute
Period" shall have the meaning specified in Section 9.3(a).
“DTC”
shall mean The Depository Trust Company, or any successor performing substantially the same function for the Company.
“DTC/FAST
Program” shall mean the DTC’s Fast Automated Securities Transfer Program.
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“DWAC”
shall mean Deposit Withdrawal at Custodian as defined by the DTC.
“DWAC
Eligible” shall mean that (a) the Common Stock is eligible at DTC for full services pursuant to DTC’s Operational Arrangements, including, without limitation, transfer through DTC’s DWAC system, (b) the Company has been approved
(without revocation) by the DTC’s underwriting department, (c) the Transfer Agent is approved as an agent in the DTC/FAST Program, (d) the Warrant Shares or Put Shares, as applicable, are otherwise eligible for delivery via DWAC, and (e) the
Transfer Agent does not have a policy prohibiting or limiting delivery of the Warrant Shares or Put Shares, as applicable, via DWAC.
“DWAC Shares” means shares of Common Stock that are (i) issued in electronic form, (ii) freely tradable and transferable and without restriction on resale and (iii) timely credited by the Company to the Investor’s or
its designee’s specified DWAC account with DTC under the DTC/FAST Program, or any similar program hereafter adopted by DTC performing substantially the same function.
"Exchange
Act" shall mean the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.
“Exchange
Cap” shall have the meaning set forth in Section 7.1(c).
"Execution
Date" shall mean the date of this Agreement.
"FINRA"
shall mean the Financial Industry Regulatory Authority, Inc.
"Investment
Amount" shall mean the Put Shares referenced in the Put Notice multiplied by the Purchase Price, minus the Clearing Costs.
"Indemnified
Party" shall have the meaning specified in Section 9.2.
"Indemnifying
Party" shall have the meaning specified in Section 9.2.
"Indemnity
Notice" shall have the meaning specified in Section 9.3(e).
“Initial
Purchase Price” shall mean 90% of the volume weighted average price of the Company’s Common Stock on the Principal Market on the Trading Day immediately preceding the respective Put Date.
"Investor"
shall have the meaning specified in the preamble to this Agreement.
“Lien”
means a lien, charge, pledge, security interest, encumbrance, right of first refusal, preemptive right or other restriction.
"Market
Price" shall mean the average of the two (2) lowest volume weighted average prices of the Company’s Common Stock on the Principal Market during the Valuation Period, in each case as reported by Quotestream or other reputable source
designated by the Investor.
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"Material
Adverse Effect" shall mean any effect on the business, operations, properties, or financial condition of the Company and the Subsidiaries that is material and adverse to the Company and the Subsidiaries and/or any condition,
circumstance, or situation that would prohibit or otherwise materially interfere with the ability of the Company to enter into and perform its obligations under any Transaction Document.
"Maximum
Commitment Amount" shall mean Ten Million Dollars ($10,000,000.00).
"Person"
shall mean an individual, a corporation, a partnership, an association, a trust or other entity or organization, including a government or political subdivision or an agency or instrumentality thereof.
"Principal
Market" shall mean any of the national exchanges (i.e. NYSE, NYSE AMEX, and Nasdaq), or principal quotation systems (i.e. OTCQX, OTCQB, and OTC Pink), or other principal exchange or recognized quotation system which is at the time
the principal trading platform or market for the Common Stock.
"Purchase
Price" shall mean 90% of the Market Price on such date on which the Purchase Price is calculated in accordance with the terms and conditions of this Agreement.
"Put"
shall mean the right of the Company to require the Investor to purchase shares of Common Stock, subject to the terms and conditions of this Agreement.
"Put Date"
shall mean any Trading Day during the Commitment Period that a Put Notice is deemed delivered pursuant to Section 2.2(b).
"Put Notice"
shall mean a written notice, substantially in the form of Exhibit A hereto, to Investor setting forth the Put Shares which the Company intends to require Investor to
purchase pursuant to the terms of this Agreement.
"Put Shares"
shall mean all shares of Common Stock issued, or that the Company shall be entitled to issue, per any applicable Put Notice in accordance with the terms and conditions of this Agreement.
"Registration
Statement" shall have the meaning specified in Section 6.4.
"Regulation
D" shall mean Regulation D promulgated under the Securities Act.
“Required
Minimum” shall mean, as of any date, the maximum aggregate number of shares of Common Stock potentially issuable at such time pursuant to the Transaction Document,
which shall be calculated on each such date as follows: the then remaining Maximum Commitment Amount divided by the Initial Purchase Price on each such date plus any Warrant Shares, ignoring any beneficial ownership limitations set forth
herein and therein.
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"Rule 144"
shall mean Rule 144 under the Securities Act or any similar provision then in force under the Securities Act.
"SEC"
shall mean the United States Securities and Exchange Commission.
“SEC
Documents” shall have the meaning specified in Section 4.5.
“Securities"
means, collectively, the Put Shares, Warrant, and Warrant Shares.
"Securities
Act" shall mean the Securities Act of 1933, as amended.
“Short
Sales” shall mean all “short sales” as defined in Rule 200 of Regulation SHO under the Exchange Act.
“Subsidiary”
means any Person the Company wholly-owns or controls, or in which the Company, directly or indirectly, owns a majority of the voting stock or similar voting interest, in each case that would be disclosable pursuant to Item 601(b)(21) of Regulation
S-K promulgated under the Securities Act.
"Third Party
Claim" shall have the meaning specified in Section 9.3(a).
“Trading Day”
shall mean a day on which the Principal Market shall be open for business.
“Transaction
Documents” shall mean this Agreement, the registration rights agreement of even date, and all exhibits hereto and thereto.
"Transfer
Agent" shall mean Continental Stock Transfer & Trust Company, the current transfer
agent of the Company, with a mailing address of 0 Xxxxx Xxxxxx Xxxxx, 00xx Xxxxx, Xxx Xxxx, XX 00000, and any successor transfer agent of the Company.
“Transfer Agent Instruction Letter” means the letter from the Company
to the Transfer Agent entered into on or around the date of this Agreement that instructs the Transfer Agent to issue the Put Shares and the Warrant Shares pursuant to the Transaction Documents.
"Valuation
Period" shall mean the period of seven (7) Trading Days immediately following the Clearing Date associated with the applicable Put Notice during which the Purchase Price of the Common Stock is valued. The Valuation Period shall begin
on the first Trading Day following the Clearing Date.
“Warrant” shall mean
that certain common stock purchase warrant for the purchase of 560,000 shares of the Company’s common stock which shall be issued to Investor on the date of this Agreement.
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“Warrant
Shares” shall mean all of the shares of the Company’s common stock underlying the Warrant.
ARTICLE II
Section 2.2 MECHANICS.
(a) PUT NOTICE. At any time and from time to time during the Commitment Period, except as provided in this Agreement, the Company may
deliver a Put Notice to Investor, subject to satisfaction of the conditions set forth in Section 7.2 and otherwise provided herein. The initial price per share identified in the respective Put Notice shall be equal to the Initial Purchase Price
and shall only be used for purposes of determining the number of shares of Common Stock that the Company can issue pursuant to a respective Put Notice in accordance with Section 2.1 of this Agreement (for the avoidance of doubt, the Initial
Purchase Price shall not be used for purposes of determining the actual price per share to be paid by the Investor to the Company with respect to a Put Notice). At the end of the Valuation Period, the Purchase Price for the respective Put Shares
and Investment Amount shall be established as further provided in this Agreement. The Company shall deliver, or cause to be delivered, the Put Shares as DWAC Shares to the Investor within one (1) Trading Day following the Put Date.
(b) DATE OF DELIVERY OF PUT NOTICE. A Put Notice shall be deemed delivered on (i) the Trading Day it is received by email by the Investor if such notice is received on or prior to 9:00 a.m. EST or (ii) the
immediately succeeding Trading Day if it is received by email after 9:00 a.m. EST on a Trading Day or at any time on a day which is not a Trading Day. The Company shall not deliver
a Put Notice to the Investor during the period beginning on the Put Date of the immediately prior Put Notice and ending on the date that is seven (7) Trading Days after
the Clearing Date associated with the Common Stock of the immediately prior Put Notice.
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ARTICLE III
The Investor represents and warrants to the Company that:
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ARTICLE IV
The Company represents and warrants to the Investor that:
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9
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Subsidiary, or give to others any rights of termination, amendment, acceleration or cancellation of,
any agreement, indenture, instrument or any "lock-up" or similar provision of any underwriting or similar agreement to which the Company or any Subsidiary is a party, or (c) result in a violation of any federal, state or local law, rule,
regulation, order, judgment or decree (including federal and state securities laws and regulations) applicable to the Company or any Subsidiary or by which any property or asset of the Company or any Subsidiary 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) nor is the Company otherwise in violation of, conflict with or in default
under any of the foregoing. The business of the Company is not being conducted in violation of any law, ordinance or regulation of any governmental entity, except for possible violations that either singly or in the aggregate do not and will not
have a Material Adverse Effect. The Company is not required under federal, state or local law, rule or regulation to obtain any consent, authorization or order of, or make any filing or registration with, any court or governmental agency in order
for it to execute, deliver or perform any of its obligations under this Agreement or the other Transaction Documents (other than any SEC, FINRA or state securities filings that may be required to be made by the Company subsequent to any Closing or
any registration statement that may be filed pursuant hereto); provided that, for purposes of the representation made in this sentence, the Company is assuming and relying upon the accuracy of the relevant representations and agreements of Investor
herein.
Section 4.11 NO SOLICITATION; NO BROKERS. Except with respect to X. X. Xxxxxx & Co., a registered broker-dealer (CRD#: 43520) (the “Placement Agent”), the Company has taken no action which would give rise to any
claim by any person for brokerage commissions, transaction fees or similar payments relating to this Agreement or the transactions contemplated hereby. The Company acknowledges and agrees that neither the Investor nor its employee(s), member(s),
beneficial owner(s), or partner(s) solicited the Company to enter into this Agreement and consummate the transactions described in this Agreement.
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ARTICLE V
ARTICLE VI
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ARTICLE VII
(b) PERFORMANCE
BY INVESTOR. Investor shall have performed, satisfied and complied in all respects with all covenants, agreements and conditions required by this Agreement to be performed, satisfied or complied with by the Investor at or prior to
such Closing.
(c) PRINCIPAL
MARKET REGULATION. The Company shall not issue any Put Shares, and the Investor shall not have the right to receive any Put Shares, if the issuance of such Put Shares would exceed the aggregate number of shares of Common Stock which
the Company may issue without breaching the Company’s obligations under the rules or regulations of the Principal Market (the “Exchange Cap”).
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(a) EFFECTIVE REGISTRATION STATEMENT. The Registration Statement, and any amendment or supplement thereto, shall remain effective for the resale by the Investor of the Put Shares and the Warrant Shares at
prevailing market prices (and not fixed prices) and (i) neither the Company nor the Investor shall have received notice that the SEC has issued or intends to issue a stop order with respect to such Registration Statement or that the SEC otherwise
has suspended or withdrawn the effectiveness of such Registration Statement, either temporarily or permanently, or intends or has threatened to do so and (ii) no other suspension of the use of, or withdrawal of the effectiveness of, such
Registration Statement or related prospectus shall exist.
(b) ACCURACY OF THE COMPANY'S REPRESENTATIONS AND WARRANTIES. The representations and warranties of the Company shall be true and correct in all material respects as of the date of this Agreement and as of the
date of each Closing (except for representations and warranties specifically made as of a particular date).
(c) PERFORMANCE
BY THE COMPANY. The Company shall have performed, satisfied and complied in all material respects with all covenants, agreements and conditions required by this Agreement to be performed, satisfied or complied with by the Company.
(d) NO
INJUNCTION. No statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated or adopted by any court or governmental authority of competent jurisdiction that prohibits or
directly and materially adversely affects any of the transactions contemplated by the Transaction Documents, and no proceeding shall have been commenced that may have the effect of prohibiting or materially adversely affecting any of the
transactions contemplated by the Transaction Documents.
(e) ADVERSE
CHANGES. Since the date of filing of the Company's most recent SEC Document, no event that had or is reasonably likely to have a Material Adverse Effect has occurred.
(f) NO
SUSPENSION OF TRADING IN OR DELISTING OF COMMON STOCK. The trading of the Common Stock shall not have been suspended by the SEC, the Principal Market or FINRA, or otherwise halted for any reason, and the Common Stock shall have been
approved for listing or quotation on and shall not have been delisted from the Principal Market. In the event of a suspension, delisting, or halting for any reason, of the trading of the Common Stock, as contemplated by this Section 7.2(f), the
Investor shall have the right to return to the Company any remaining amount of Put Shares associated with such Put, and the Purchase Price with respect to such Put shall be reduced accordingly.
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(g) BENEFICIAL
OWNERSHIP LIMITATION. The number of Put Shares then to be purchased by the Investor shall not exceed the number of such shares that, when aggregated with all other shares of Common Stock then owned by the Investor beneficially or
deemed beneficially owned by the Investor, would result in the Investor owning more than the Beneficial Ownership Limitation (as defined below), as determined in accordance with Section 16 of the Exchange Act and the regulations promulgated
thereunder. For purposes of this Section 7.2(g), in the event that the amount of Common Stock outstanding, as determined in accordance with Section 16 of the Exchange Act and the regulations promulgated thereunder, is greater on a Closing Date
than on the date upon which the Put Notice associated with such Closing Date is given, the amount of Common Stock outstanding on such Closing Date shall govern for purposes of determining whether the Investor, when aggregating all purchases of
Common Stock made pursuant to this Agreement, would own more than the Beneficial Ownership Limitation following such Closing Date. The “Beneficial Ownership Limitation”
shall be 4.99% of the number of shares of the Common Stock outstanding immediately after giving effect to the issuance of shares of Common Stock issuable pursuant to a Put Notice.
(h) PRINCIPAL
MARKET REGULATION. The issuance of the Put Shares shall not exceed the Exchange Cap if applicable.
(i) NO
KNOWLEDGE. The Company shall have no knowledge of any event more likely than not to have the effect of causing the Registration Statement to be suspended or otherwise ineffective (which event is more likely than not to occur within
the fifteen (15) Trading Days following the Trading Day on which such Put Notice is deemed delivered).
(k) OFFICER’S
CERTIFICATE. On the date of delivery of each Put Notice, the Investor shall have received the Closing Certificate executed by an executive officer of the Company and to the effect that all the conditions to such Closing shall have
been satisfied as of the date of each such certificate.
(l) DWAC
ELIGIBLE. The Common Stock must be DWAC Eligible and not subject to a “DTC chill.”
(m) SEC DOCUMENTS.
All reports, schedules, registrations, forms, statements, information and other documents required to have been filed by the Company with the SEC pursuant to the reporting requirements of the Exchange Act shall have been filed with the SEC within
the applicable time periods prescribed for such filings under the Exchange Act.
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(n) RESERVE. The Company
shall have reserved the Required Minimum for the Investor’s benefit under this Agreement, the Company shall have satisfied the reserve requirements with respect to all other contracts between the Company and Investor, and the Transfer Agent
Instruction Letter shall have been executed by the Company and the Transfer Agent as well as acknowledged and agreed to in writing by the Transfer Agent.
(o) MINIMUM PRICING. The
lowest traded price of the Common Stock in the seven (7) Trading Days immediately preceding the respective Put Date must exceed $0.01 per share.
(p) BANKRUPTCY.
Bankruptcy, insolvency, reorganization or liquidation proceedings or other proceedings, voluntary or involuntary, for relief under any bankruptcy law or any law for the relief of debtors shall not be instituted by or against the Company or any
subsidiary of the Company (the “Bankruptcy Proceedings”), and the Company shall have no knowledge of any event more likely than not to have the effect of causing Bankruptcy Proceedings to arise. In the event of Bankruptcy Proceedings as
contemplated by this Section 7.2(p), the Investor shall have the right to return to the Company any remaining amount of Put Shares associated with such Put, and the Purchase Price with respect to such Put shall be reduced accordingly.
ARTICLE VIII
ARTICLE IX
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The addresses for such communications shall be:
If to the Company:
0000 Xxxx Xxxx Xxxx, Xxxxx 000
Las Vegas, NV 89148
Email: xxxx@xxxxxxxxxx.xxx
Attention: Xxxxxxx Xxxxx
If to the Investor:
Mast Hill Fund, L.P.
00 Xxxxxx Xxxx
Wellesley, MA 02482
Email: xxxxx@xxxxxxxxxxxx.xxx
Either party hereto may from time to time change its address or email for notices under this Section
9.1 by giving at least ten (10) days' prior written notice of such changed address to the other party hereto.
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the Securities Act, the Exchange Act or any state securities law, as such Damages are incurred, except
to the extent such Damages result primarily from the Indemnified Party's failure to perform any covenant or agreement contained in this Agreement or the Indemnified Party's negligence, recklessness or bad faith in performing its obligations under
this Agreement; provided, however, that the foregoing indemnity agreement shall
not apply to any Damages of an Indemnified Party to the extent, but only to the extent, arising out of or based upon any untrue statement or alleged untrue statement or omission or alleged omission made by an Indemnifying Party in reliance upon and
in conformity with written information furnished to the Indemnifying Party by the Indemnified Party expressly for use in the Registration Statement, any post-effective amendment thereof or supplement thereto, or any preliminary prospectus or final
prospectus (as amended or supplemented).
(a) In the event any claim or demand in respect of which an
Indemnified Party might seek indemnity under Section 9.2 is asserted against or sought to be collected from such Indemnified Party by a Person other than a party hereto or an affiliate thereof (a "Third Party Claim"), the Indemnified Party shall deliver a written notification, enclosing a copy of all papers served, if any, and specifying the nature of and basis for such Third Party Claim and for the
Indemnified Party's claim for indemnification that is being asserted under any provision of Section 9.2 against an Indemnifying Party, together with the amount or, if not then reasonably ascertainable, the estimated amount, determined in good
faith, of such Third Party Claim (a "Claim Notice") with reasonable promptness to the Indemnifying Party. If the Indemnified Party fails to provide the Claim Notice
with reasonable promptness after the Indemnified Party receives notice of such Third Party Claim, the Indemnifying Party shall not be obligated to indemnify the Indemnified Party with respect to such Third Party Claim to the extent that the
Indemnifying Party's ability to defend has been prejudiced by such failure of the Indemnified Party. The Indemnifying Party shall notify the Indemnified Party as soon as practicable within the period ending thirty (30) calendar days following
receipt by the Indemnifying Party of either a Claim Notice or an Indemnity Notice (as defined below) (the "Dispute Period") whether the Indemnifying Party disputes
its liability or the amount of its liability to the Indemnified Party under Section 9.2 and whether the Indemnifying Party desires, at its sole cost and expense, to defend the Indemnified Party against such Third Party Claim.
(i) If the Indemnifying Party notifies the Indemnified Party within the
Dispute Period that the Indemnifying Party desires to defend the Indemnified Party with respect to the Third Party Claim pursuant to this Section 9.3(a), then the Indemnifying Party shall have the right to defend, with counsel reasonably
satisfactory to the Indemnified Party, at the sole cost and expense of the Indemnifying Party, such Third Party Claim by all appropriate proceedings, which proceedings shall be vigorously and diligently prosecuted by the Indemnifying Party to a
final conclusion or will be settled at the discretion of the Indemnifying Party (but only with the consent of the Indemnified Party in the case of any settlement that provides for any relief other than the payment of monetary damages or that
provides for the payment of monetary damages as to which the Indemnified Party shall not be indemnified in full pursuant to Section 9.2).
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The Indemnifying Party shall have full control of such defense and proceedings, including any
compromise or settlement thereof; provided, however, that the Indemnified Party
may, at the sole cost and expense of the Indemnified Party, at any time prior to the Indemnifying Party's delivery of the notice referred to in the first sentence of this clause (i), file any motion, answer or other pleadings or take any other
action that the Indemnified Party reasonably believes to be necessary or appropriate to protect its interests; and provided, further, that if requested by the Indemnifying Party, the Indemnified Party will, at the sole cost and expense of the Indemnifying Party, provide reasonable cooperation to the Indemnifying Party in
contesting any Third Party Claim that the Indemnifying Party elects to contest. The Indemnified Party may participate in, but not control, any defense or settlement of any Third Party Claim controlled by the Indemnifying Party pursuant to this
clause (i), and except as provided in the preceding sentence, the Indemnified Party shall bear its own costs and expenses with respect to such participation. Notwithstanding the foregoing, the Indemnified Party may takeover the control of the
defense or settlement of a Third Party Claim at any time if it irrevocably waives its right to indemnity under Section 9.2 with respect to such Third Party Claim.
(ii) If the Indemnifying Party fails to notify the Indemnified Party within
the Dispute Period that the Indemnifying Party desires to defend the Third Party Claim pursuant to Section 9.3(a), or if the Indemnifying Party gives such notice but fails to prosecute vigorously and diligently or settle the Third Party Claim, or
if the Indemnifying Party fails to give any notice whatsoever within the Dispute Period, then the Indemnified Party shall have the right to defend, at the sole cost and expense of the Indemnifying Party, the Third Party Claim by all appropriate
proceedings, which proceedings shall be prosecuted by the Indemnified Party in a reasonable manner and in good faith or will be settled at the discretion of the Indemnified Party(with the consent of the Indemnifying Party, which consent will not be
unreasonably withheld). The Indemnified Party will have full control of such defense and proceedings, including any compromise or settlement thereof; provided, however, that if requested by the Indemnified Party, the Indemnifying Party will, at the
sole cost and expense of the Indemnifying Party, provide reasonable cooperation to the Indemnified Party and its counsel in contesting any Third Party Claim which the Indemnified Party is contesting. Notwithstanding the foregoing provisions of this
clause (ii), if the Indemnifying Party has notified the Indemnified Party within the Dispute Period that the Indemnifying Party disputes its liability or the amount of its liability hereunder to the Indemnified Party with respect to such Third
Party Claim and if such dispute is resolved in favor of the Indemnifying Party in the manner provided in clause (iii) below, the Indemnifying Party will not be required to bear the costs and expenses of the Indemnified Party's defense pursuant to
this clause (ii) or of the Indemnifying Party's participation therein at the Indemnified Party's request, and the Indemnified Party shall reimburse the Indemnifying Party in full for all reasonable costs and expenses incurred by the Indemnifying
Party in connection with such litigation. The Indemnifying Party may participate in, but not control, any defense or settlement controlled by the Indemnified Party pursuant to this clause (ii), and the Indemnifying Party shall bear its own costs
and expenses with respect to such participation.
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(iii) If the Indemnifying Party notifies the Indemnified Party that it does not dispute its
liability or the amount of its liability to the Indemnified Party with respect to the Third Party Claim under Section 9.2 or fails to notify the Indemnified Party within the Dispute Period whether the Indemnifying Party disputes its liability or
the amount of its liability to the Indemnified Party with respect to such Third Party Claim, the amount of Damages specified in the Claim Notice shall be conclusively deemed a liability of the Indemnifying Party under Section 9.2 and the
Indemnifying Party shall pay the amount of such Damages to the Indemnified Party on demand. If the Indemnifying Party has timely disputed its liability or the amount of its liability with respect to such claim, the Indemnifying Party and the
Indemnified Party shall proceed in good faith to negotiate a resolution of such dispute; provided, however, that if the dispute is not resolved within thirty (30) days after the Claim Notice, the Indemnifying Party shall be entitled to institute such legal action as it deems appropriate.
(b) In the event any Indemnified Party should have a claim under
Section 9.2 against the Indemnifying Party that does not involve a Third Party Claim, the Indemnified Party shall deliver a written notification of a claim for indemnity under Section 9.2 specifying the nature of and basis for such claim, together
with the amount or, if not then reasonably ascertainable, the estimated amount, determined in good faith, of such claim (an "Indemnity Notice") with reasonable
promptness to the Indemnifying Party. The failure by any Indemnified Party to give the Indemnity Notice shall not impair such party's rights hereunder except to the extent that the Indemnifying Party demonstrates that it has been irreparably
prejudiced thereby. If the Indemnifying Party notifies the Indemnified Party that it does not dispute the claim or the amount of the claim described in such Indemnity Notice or fails to notify the Indemnified Party within the Dispute Period whether
the Indemnifying Party disputes the claim or the amount of the claim described in such Indemnity Notice, the amount of Damages specified in the Indemnity Notice will be conclusively deemed a liability of the Indemnifying Party under Section 9.2 and
the Indemnifying Party shall pay the amount of such Damages to the Indemnified Party on demand. If the Indemnifying Party has timely disputed its liability or the amount of its liability with respect to such claim, the Indemnifying Party and the
Indemnified Party shall proceed in good faith to negotiate a resolution of such dispute; provided, however, that if the dispute is not resolved within thirty (30) days after the Claim Notice, the Indemnifying Party shall be entitled to institute
such legal action as it deems appropriate.
(c) The Indemnifying Party agrees to pay the Indemnified Party, promptly
as such expenses are incurred and are due and payable, for any reasonable legal fees or other reasonable expenses incurred by them in connection with investigating or defending any such Claim.
(d) The indemnity provisions contained herein shall be in addition to
(i) any cause of action or similar rights of the Indemnified Party against the Indemnifying Party or others, and (ii) any liabilities the Indemnifying Party may be subject to.
ARTICLE X
Section 10.1 GOVERNING LAW; JURISDICTION. This Agreement shall be governed by and interpreted in accordance with the laws of the State of Nevada without regard to the principles of conflicts of law. Each of the Company
and the Investor hereby submits to the exclusive jurisdiction of the United States federal and state courts located in the Commonwealth of Massachusetts, with respect to any dispute arising under the Transaction Documents or the transactions
contemplated thereby.
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Section 10.2 [Intentionally Omitted.]
Section 10.5 TERMINATION. The Company may terminate this Agreement at any time by written notice to the Investor, except during any Valuation Period or at any time that the Investor holds any of the Put Shares. In
addition, this Agreement shall automatically terminate at the end of the Commitment Period. Notwithstanding anything in this Agreement to the contrary, (i) the provisions of Articles III, IV, VI, IX of this Agreement and the agreements and
covenants of the Company and the Investor set forth in Article X of this Agreement shall survive the termination of this Agreement and (ii) the Investor shall retain all rights to the Warrant and Warrant Shares even if this Agreement is terminated.
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[Signature Page Follows]
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IN WITNESS WHEREOF, the parties have caused this
Agreement to be duly executed by their respective officers thereunto duly authorized as of the day and year first above written.
THE COMPANY:
By: /s/ Xxxxxxx Xxxxx
Name: Xxxxxxx Xxxxx
Title: Chief Executive Officer
INVESTOR:
MAST HILL FUND, L.P.
By: /s/ Xxxxxxx Xxxxxxx
Name: Xxxxxxx Xxxxxxx
Title: Chief Investment Officer
[Signature Page to equity purchase agreement]
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EXHIBIT A
FORM OF PUT NOTICE
TO: MAST HILL FUND, L.P.
DATE: ____________________
We refer to the equity purchase agreement, dated November 10, 2021 (the “Agreement”), entered into by and between GZ6G Technologies Corp. and you. Capitalized terms defined in the Agreement shall, unless otherwise defined herein, have the same
meaning when used herein.
We hereby:
1) Give you notice that we require you to purchase
Put Shares at a purchase price per share of ____________; and
2) Certify that, as of the date hereof, the conditions set forth in Section 7.2 of the Agreement are
satisfied.
By: _______________________
Name: Xxxxxxx Xxxxx
Title: Chief Executive Officer
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EXHIBIT B
FORM OF OFFICER’S CERTIFICATE
Pursuant to Section 7.2(k) of that certain equity purchase agreement, dated November
10, 2021 (the “Agreement”), by and between GZ6G Technologies Corp. (the “Company”)
and Mast Hill Fund, L.P. (the “Investor”), the undersigned, in his capacity as Chief Executive Officer of the Company, and not in his individual capacity, hereby
certifies, as of the date hereof (such date, the “Condition Satisfaction Date”), the following:
1. The representations and warranties of the Company are true and correct
in all material respects as of the Condition Satisfaction Date as though made on the Condition Satisfaction Date (except for representations and warranties specifically made as of a particular date) with respect to all periods, and as to all events
and circumstances occurring or existing to and including the Condition Satisfaction Date, except for any conditions which have temporarily caused any representations or warranties of the Company set forth in the Agreement to be incorrect and which
have been corrected with no continuing impairment to the Company or the Investor; and
2. All of the conditions precedent to the obligation of the Investor to
purchase Put Shares set forth in the Agreement, including but not limited to Section 7.2 of the Agreement, have been satisfied as of the Condition Satisfaction Date.
Capitalized terms used herein shall have the meanings set forth in the Agreement unless
otherwise defined herein.
IN WITNESS WHEREOF, the undersigned has hereunto affixed his hand as of the ________, 20__.
By: _______________________
Name: Xxxxxxx Xxxxx
Title: Chief Executive Officer
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