Exhibit 10-a
SECURITIES PURCHASE AGREEMENT
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THIS SECURITIES PURCHASE AGREEMENT (this "Agreement"), dated as of
August 1, 2005, by and among GLOBAL CONCEPTS, LTD., a Colorado corporation
(the "Company"), and the Buyers listed on Schedule I attached hereto
(individually, a "Buyer" or collectively "Buyers").
WITNESSETH
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WHEREAS, the Company and the Buyer(s) are executing and delivering
this Agreement in reliance upon an exemption from securities registration
pursuant to Section 4(2) and/or Rule 506 of Regulation D ("Regulation D")
as promulgated by the U.S. Securities and Exchange Commission (the "SEC")
under the Securities Act of 1933, as amended (the "Securities Act");
WHEREAS, the parties desire that, upon the terms and subject to the
conditions contained herein, the Company shall issue and sell to the
Buyer(s), as provided herein, and the Buyer(s) shall purchase up to Two
Million Five Hundred Thousand Dollars ($2,500,000) of secured convertible
Debenture (the "Convertible Debenture(s)"), which shall be convertible
into shares of the Company's common stock, no par value (the "Common
Stock") (as converted, the "Conversion Shares") of which One Million Five
Hundred Thousand Dollars ($1,500,000) has previously been funded pursuant
to that certain promissory note dated January 26, 2005 which shall be
terminated simultaneously with the issuance of the Convertible Debenture
dated the date hereof and One Million Dollars ($1,000,000) shall be
funded two (2) business days prior to the date the registration statement
(the "Registration Statement") is filed, pursuant to the Investor
Registration Rights Agreement dated the date hereof, with the United
States Securities and Exchange Commission (the "SEC") (the "Closing")
(individually referred to as a "Closing" collectively referred to as the
"Closings"), for a total purchase price of up to Two Million Five Hundred
Thousand Dollars ($2,500,000), (the "Purchase Price") in the respective
amounts set forth opposite each Buyer(s) name on Schedule I (the
"Subscription Amount"); and
WHEREAS, contemporaneously with the execution and delivery of this
Agreement, the parties hereto are executing and delivering a Registration
Rights Agreement substantially in the form attached hereto as Exhibit A
(the "Investor Registration Rights Agreement") pursuant to which the
Company has agreed to provide certain registration rights under the
Securities Act and the rules and regulations promulgated there under, and
applicable state securities laws; and
WHEREAS, the aggregate proceeds of the sale of the Convertible
Debenture contemplated hereby shall be held in escrow pursuant to the
terms of an escrow agreement substantially in the form of the Escrow
Agreement attached hereto as Exhibit B.
WHEREAS, contemporaneously with the execution and delivery of this
Agreement, the parties hereto are executing and delivering a Security
Agreement substantially in the form attached hereto as Exhibit C (the
"Security Agreement") pursuant to which the Company has agreed to provide
the Buyer a security interest in Pledged Collateral (as this term is
defined in the Security Agreement) to secure the Company's obligations
under this Agreement, the Convertible Debenture, the Investor Registration
Rights Agreement, the Irrevocable Transfer Agent Instructions, the
Security Agreement, the Pledge and Escrow Agreement or any other
obligations of the Company to the Buyer;and
WHEREAS, contemporaneously with the execution and delivery of this
Agreement, the parties hereto are executing and delivering Irrevocable
Transfer Agent Instructions substantially in the form attached hereto as
Exhibit D (the "Irrevocable Transfer Agent Instructions")
NOW, THEREFORE, in consideration of the mutual covenants and other
agreements contained in this Agreement the Company and the Buyer(s) hereby
agree as follows:
1. PURCHASE AND SALE OF CONVERTIBLE DEBENTURE.
(a) Purchase of Convertible Debenture. Subject
to the satisfaction (or waiver) of the terms and conditions of this
Agreement, each Buyer agrees, severally and not jointly, to purchase at
each Closing and the Company agrees to sell and issue to each Buyer,
severally and not jointly, at each Closing, Convertible Debenture in
amounts corresponding with the Subscription Amount set forth opposite each
Buyer's name on Schedule I hereto. Upon execution hereof by a Buyer, the
Buyer shall wire transfer the Subscription Amount set forth opposite his
name on Schedule I in same-day funds or a check payable to "Xxxxx
Xxxxxxxx, Esq., as Escrow Agent for Global Concepts, Ltd./Cornell Capital
Partners, LP", which Subscription Amount shall be held in escrow pursuant
to the terms of the Escrow Agreement (as hereinafter defined) and
disbursed in accordance therewith. Notwithstanding the foregoing, a Buyer
may withdraw his Subscription Amount and terminate this Agreement as to
such Buyer at any time after the execution hereof and prior to Closing (as
hereinafter defined).
(b) Closing Date. The DebentureClosing of the
purchase and sale of the Convertible Debenture shall take place at 10:00
a.m. Eastern Standard Time two (2) business days prior to the date the
Registration Statement is filed with the SEC, subject to notification of
satisfaction of the conditions to the Closing set forth herein and in
Sections 6 and 7 below (or such later date as is mutually agreed to by the
Company and the Buyer(s)) (the "Closing Date"). The Closing shall occur
on the Closing Date at the offices of Yorkville Advisors, LLC, 0000 Xxxxxx
Xxxxxx, Xxxxx 0000, Xxxxxx Xxxx, Xxx Xxxxxx 00000 (or such other place as
is mutually agreed to by the Company and the Buyer(s)).
(c) Escrow Arrangements; Form of Payment. Upon
execution hereof by Buyer(s) and pending the Closings, the aggregate
proceeds of the sale of the Convertible Debenture to Buyer(s) pursuant
hereto shall be deposited in a non-interest bearing escrow account with
Xxxxx Xxxxxxxx, Esq., as escrow agent (the "Escrow Agent"), pursuant to
the terms of an escrow agreement between the Company, the Buyer(s) and the
Escrow Agent in the form attached hereto as Exhibit B (the "Escrow
Agreement"). Subject to the satisfaction of the terms and conditions of
this Agreement, on the Closing Date, (i) the Escrow Agent shall deliver to
the Company in accordance with the terms of the Escrow Agreement such
aggregate proceeds for the Convertible Debenture to be issued and sold to
such Buyer(s), minus the unpaid structuring fees and expenses of Yorkville
Advisors Management, LLC of Ten Thousand Dollars ($10,000) which shall be
paid directly from the gross proceeds held in escrow of the Closing and
(ii) the Company shall deliver to each Buyer, a Convertible Debenture
which such Buyer(s) is purchasing in amounts indicated opposite such
Buyer's name on Schedule I, duly executed on behalf of the Company.
2. BUYER'S REPRESENTATIONS AND WARRANTIES.
Each Buyer represents and warrants, severally and not jointly, that:
(a) Investment Purpose. Each Buyer is acquiring
the Convertible Debenture and, upon conversion of Convertible Debenture,
the Buyer will acquire the Conversion Shares then issuable, for its own
account for investment only and not with a view towards, or for resale in
connection with, the public sale or distribution thereof, except pursuant
to sales registered or exempted under the Securities Act; provided,
however, that by making the representations herein, such Buyer reserves
the right to dispose of the Conversion Shares at any time in accordance
with or pursuant to an effective registration statement covering such
Conversion Shares or an available exemption under the Securities Act.
(b) Accredited Investor Status. Each Buyer is
an "Accredited Investor" as that term is defined in Rule 501(a)(3) of
Regulation D.
(c) Reliance on Exemptions. Each Buyer
understands that the Convertible Debenture are being offered and sold to
it in reliance on specific exemptions from the registration requirements
of United States federal and state securities laws and that the Company is
relying in part upon the truth and accuracy of, and such Buyer's
compliance with, the representations, warranties, agreements,
acknowledgments and understandings of such Buyer set forth herein in order
to determine the availability of such exemptions and the eligibility of
such Buyer to acquire such securities.
(d) Information. Each Buyer and its advisors
(and his or, its counsel), if any, have been furnished with all materials
relating to the business, finances and operations of the Company and
information he deemed material to making an informed investment decision
regarding his purchase of the Convertible Debenture and the Conversion
Shares, which have been requested by such Buyer. Each Buyer and its
advisors, if any, have been afforded the opportunity to ask questions of
the Company and its management. Neither such inquiries nor any other due
diligence investigations conducted by such Buyer or its advisors, if any,
or its representatives shall modify, amend or affect such Buyer's right to
rely on the Company's representations and warranties contained in Section
3 below. Each Buyer understands that its investment in the Convertible
Debenture and the Conversion Shares involves a high degree of risk. Each
Buyer is in a position regarding the Company, which, based upon
employment, family relationship or economic bargaining power, enabled and
enables such Buyer to obtain information from the Company in order to
evaluate the merits and risks of this investment. Each Buyer has sought
such accounting, legal and tax advice, as it has considered necessary to
make an informed investment decision with respect to its acquisition of
the Convertible Debenture and the Conversion Shares.
(e) No Governmental Review. Each Buyer
understands that no United States federal or state agency or any other
government or governmental agency has passed on or made any recommendation
or endorsement of the Convertible Debenture or the Conversion Shares, or
the fairness or suitability of the investment in the Convertible Debenture
or the Conversion Shares, nor have such authorities passed upon or
endorsed the merits of the offering of the Convertible Debenture or the
Conversion Shares.
(f) Transfer or Resale. Each Buyer understands
that except as provided in the Investor Registration Rights Agreement: (i)
the Convertible Debenture have not been and are not being registered under
the Securities Act or any state securities laws, and may not be offered
for sale, sold, assigned or transferred unless (A) subsequently registered
thereunder, or (B) such Buyer shall have delivered to the Company an
opinion of counsel, in a generally acceptable form, to the effect that
such securities to be sold, assigned or transferred may be sold, assigned
or transferred pursuant to an exemption from such registration
requirements; (ii) any sale of such securities made in reliance on Rule
144 under the Securities Act (or a successor rule thereto) ("Rule 144")
may be made only in accordance with the terms of Rule 144 and further, if
Rule 144 is not applicable, any resale of such securities under
circumstances in which the seller (or the person through whom the sale is
made) may be deemed to be an underwriter (as that term is defined in the
Securities Act) may require compliance with some other exemption under the
Securities Act or the rules and regulations of the SEC thereunder; and
(iii) neither the Company nor any other person is under any obligation to
register such securities under the Securities Act or any state securities
laws or to comply with the terms and conditions of any exemption
thereunder. The Company reserves the right to place stop transfer
instructions against the shares and certificates for the Conversion
Shares.
(g) Legends. Each Buyer understands that the
certificates or other instruments representing the Convertible Debenture
and or the Conversion Shares shall bear a restrictive legend in
substantially the following form (and a stop transfer order may be placed
against transfer of such stock certificates):
THE SECURITIES REPRESENTED BY THIS CERTIFICATE
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED, OR APPLICABLE STATE
SECURITIES LAWS. THE SECURITIES HAVE BEEN
ACQUIRED SOLELY FOR INVESTMENT PURPOSES AND NOT
WITH A VIEW TOWARD RESALE AND MAY NOT BE OFFERED
FOR SALE, SOLD, TRANSFERRED OR ASSIGNED IN THE
ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR
THE SECURITIES UNDER THE SECURITIES ACT OF 1933,
AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS,
OR AN OPINION OF COUNSEL, IN A GENERALLY
ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED
UNDER SAID ACT OR APPLICABLE STATE SECURITIES LAWS.
The legend set forth above shall be removed and the Company within two (2)
business days shall issue a certificate without such legend to the holder
of the Conversion Shares upon which it is stamped, if, unless otherwise
required by state securities laws, (i) in connection with a sale
transaction, provided the Conversion Shares are registered under the
Securities Act or (ii) in connection with a sale transaction, after such
holder provides the Company with an opinion of counsel, which opinion
shall be in form, substance and scope customary for opinions of counsel in
comparable transactions, to the effect that a public sale, assignment or
transfer of the Conversion Shares may be made without registration under
the Securities Act.
(h) Authorization, Enforcement. This Agreement
has been duly and validly authorized, executed and delivered on behalf of
such Buyer and is a valid and binding agreement of such Buyer enforceable
in accordance with its terms, except as such enforceability may be limited
by general principles of equity or applicable bankruptcy, insolvency,
reorganization, moratorium, liquidation and other similar laws relating
to, or affecting generally, the enforcement of applicable creditors'
rights and remedies.
(i) Receipt of Documents. Each Buyer and his or
its counsel has received and read in their entirety: (i) this Agreement
and each representation, warranty and covenant set forth herein, the
Security Agreement, the Investor Registration Rights Agreement, the Escrow
Agreement, the Irrevocable Transfer Agent Agreement, and the Pledge and
Escrow Agreement; (ii) all due diligence and other information necessary
to verify the accuracy and completeness of such representations,
warranties and covenants; (iii) the Company's Form 10-KSB for the fiscal
year ended December 31, 2004; (iv) the Company's Form 10-QSB for the
fiscal quarter ended March 31, 2005 and (v) answers to all questions each
Buyer submitted to the Company regarding an investment in the Company; and
each Buyer has relied on the information contained therein and has not
been furnished any other documents, literature, memorandum or prospectus.
(j) Due Formation of Corporate and Other Buyers.
If the Buyer(s) is a corporation, trust, partnership or other entity that
is not an individual person, it has been formed and validly exists and has
not been organized for the specific purpose of purchasing the Convertible
Debenture and is not prohibited from doing so.
(k) No Legal Advice From the Company. Each
Buyer acknowledges, that it had the opportunity to review this Agreement
and the transactions contemplated by this Agreement with his or its own
legal counsel and investment and tax advisors. Each Buyer is relying
solely on such counsel and advisors and not on any statements or
representations of the Company or any of its representatives or agents for
legal, tax or investment advice with respect to this investment, the
transactions contemplated by this Agreement or the securities laws of any
jurisdiction.
3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
The Company represents and warrants to each of the Buyers that,
except as set forth in the SEC Documents (as defined herein):
(a) Organization and Qualification. The Company
and its subsidiaries are corporations duly organized and validly existing
in good standing under the laws of the jurisdiction in which they are
incorporated, and have the requisite corporate power to own their
properties and to carry on their business as now being conducted. Each of
the Company and its subsidiaries is duly qualified as a foreign
corporation to do business and is in good standing in every jurisdiction
in which the nature of the business conducted by it makes such
qualification necessary, except to the extent that the failure to be so
qualified or be in good standing would not have a material adverse effect
on the Company and its subsidiaries taken as a whole.
(b) Authorization, Enforcement, Compliance with
Other Instruments. (i) The Company has the requisite corporate power and
authority to enter into and perform this Agreement, the Security
Agreement, the Investor Registration Rights Agreement, the Irrevocable
Transfer Agent Agreement, the Escrow Agreement, the Pledge and Escrow
Agreement, and any related agreements (collectively the "Transaction
Documents") and to issue the Convertible Debenture and the Conversion
Shares in accordance with the terms hereof and thereof, (ii) the execution
and delivery of the Transaction Documents by the Company and the
consummation by it of the transactions contemplated hereby and thereby,
including, without limitation, the issuance of the Convertible Debenture
the Conversion Shares and the reservation for issuance and the issuance
of the Conversion Shares issuable upon conversion or exercise thereof,
have been duly authorized by the Company's Board of Directors and no
further consent or authorization is required by the Company, its Board of
Directors or its stockholders, (iii) the Transaction Documents have been
duly executed and delivered by the Company, (iv) the Transaction Documents
constitute the valid and binding obligations of the Company enforceable
against the Company in accordance with their terms, except as such
enforceability may be limited by general principles of equity or
applicable bankruptcy, insolvency, reorganization, moratorium, liquidation
or similar laws relating to, or affecting generally, the enforcement of
creditors' rights and remedies. The authorized officer of the Company
executing the Transaction Documents knows of no reason why the Company
cannot file the registration statement as required under the Investor
Registration Rights Agreement or perform any of the Company's other
obligations under such documents.
(c) Capitalization. As of the date hereof the
authorized capital stock of the Company consists of 500,000,000 shares of
Common Stock and 5,000,000 shares of Preferred Stock, no par value
("Preferred Stock") of which 97,716,454 shares of Common Stock and zero
shares of Preferred Stock are issued and outstanding.. All of such
outstanding shares have been validly issued and are fully paid and
nonassessable. Except as disclosed in the SEC Documents (as defined in
Section 3(f)), no shares of Common Stock are subject to preemptive rights
or any other similar rights or any liens or encumbrances suffered or
permitted by the Company. Except as disclosed in the SEC Documents, as of
the date of this Agreement, (i) there are no outstanding options,
warrants, scrip, rights to subscribe to, calls or commitments of any
character whatsoever relating to, or securities or rights convertible
into, any shares of capital stock of the Company or any of its
subsidiaries, or contracts, commitments, understandings or arrangements by
which the Company or any of its subsidiaries is or may become bound to
issue additional shares of capital stock of the Company or any of its
subsidiaries or options, warrants, scrip, rights to subscribe to, calls or
commitments of any character whatsoever relating to, or securities or
rights convertible into, any shares of capital stock of the Company or any
of its subsidiaries, (ii) there are no outstanding debt securities and
(iii) there are no agreements or arrangements under which the Company or
any of its subsidiaries is obligated to register the sale of any of their
securities under the Securities Act (except pursuant to the Registration
Rights Agreement) and (iv) there are no outstanding registration
statements and there are no outstanding comment letters from the SEC or
any other regulatory agency. There are no securities or instruments
containing anti-dilution or similar provisions that will be triggered by
the issuance of the Convertible Debenture as described in this Agreement.
The Company has furnished to the Buyer true and correct copies of the
Company's Articles of Incorporation, as amended and as in effect on the
date hereof (the "Articles of Incorporation"), and the Company's By-laws,
as in effect on the date hereof (the "By-laws"), and the terms of all
securities convertible into or exercisable for Common Stock and the
material rights of the holders thereof in respect thereto other than stock
options issued to employees and consultants.
(d) Issuance of Securities. The Convertible
Debenture are duly authorized and, upon issuance in accordance with the
terms hereof, shall be duly issued, fully paid and nonassessable, are free
from all taxes, liens and charges with respect to the issue thereof. The
Conversion Shares issuable upon conversion of the Convertible Debenture
have been duly authorized and reserved for issuance. Upon conversion or
exercise in accordance with the Convertible Debenture the Conversion
Shares will be duly issued, fully paid and nonassessable.
(e) No Conflicts. Except as disclosed in the
SEC Documents, the execution, delivery and performance of the Transaction
Documents by the Company and the consummation by the Company of the
transactions contemplated hereby will not (i) result in a violation of the
Certificate of Incorporation, any certificate of designations of any
outstanding series of preferred stock of the Company or the By-laws or
(ii) conflict with or constitute a default (or an event which with notice
or lapse of time or both would become a default) under, or give to others
any rights of termination, amendment, acceleration or cancellation of, any
agreement, indenture or instrument to which the Company or any of its
subsidiaries is a party, or result in a violation of any law, rule,
regulation, order, judgment or decree (including federal and state
securities laws and regulations and the rules and regulations of The
National Association of Securities Dealers Inc.'s OTC Bulletin Board on
which the Common Stock is quoted) applicable to the Company or any of its
subsidiaries or by which any property or asset of the Company or any of
its subsidiaries is bound or affected. Except as disclosed in the SEC
Documents, neither the Company nor its subsidiaries is in violation of any
term of or in default under its Articles of Incorporation or By-laws or
their organizational charter or by-laws, respectively, or any material
contract, agreement, mortgage, indebtedness, indenture, instrument,
judgment, decree or order or any statute, rule or regulation applicable to
the Company or its subsidiaries. The business of the Company and its
subsidiaries is not being conducted, and shall not be conducted in
violation of any material law, ordinance, or regulation of any
governmental entity. Except as specifically contemplated by this
Agreement and as required under the Securities Act and any applicable
state securities laws, the Company is not required to obtain any consent,
authorization or order of, or make any filing or registration with, any
court or governmental agency in order for it to execute, deliver or
perform any of its obligations under or contemplated by this Agreement or
the Registration Rights Agreement in accordance with the terms hereof or
thereof. Except as disclosed in the SEC Documents, all consents,
authorizations, orders, filings and registrations which the Company is
required to obtain pursuant to the preceding sentence have been obtained
or effected on or prior to the date hereof. The Company and its
subsidiaries are unaware of any facts or circumstance, which might give
rise to any of the foregoing.
(f) SEC Documents: Financial Statements. Since
November 2000, the Company has filed all reports, schedules, forms,
statements and other documents required to be filed by it with the SEC
under of the Securities Exchange Act of 1934, as amended (the "Exchange
Act") (all of the foregoing filed prior to the date hereof or amended
after the date hereof and all exhibits included therein and financial
statements and schedules thereto and documents incorporated by reference
therein, being hereinafter referred to as the "SEC Documents"). The
Company has delivered to the Buyers or their representatives, or made
available through the SEC's website at xxxx://xxx.xxx.xxx., true and
complete copies of the SEC Documents. As of their respective dates, the
financial statements of the Company disclosed in the SEC Documents (the
"Financial Statements") complied as to form in all material respects with
applicable accounting requirements and the published rules and regulations
of the SEC with respect thereto. Such financial statements have been
prepared in accordance with generally accepted accounting principles,
consistently applied, during the periods involved (except (i) as may be
otherwise indicated in such Financial Statements or the notes thereto, or
(ii) in the case of unaudited interim statements, to the extent they may
exclude footnotes or may be condensed or summary statements) and, fairly
present in all material respects the financial position of the Company as
of the dates thereof and the results of its operations and cash flows for
the periods then ended (subject, in the case of unaudited statements, to
normal year-end audit adjustments). No other information provided by or
on behalf of the Company to the Buyer which is not included in the SEC
Documents, including, without limitation, information referred to in this
Agreement, contains any untrue statement of a material fact or omits to
state any material fact necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not
misleading.
(g) 10(b)-5. The SEC Documents do not include
any untrue statements of material fact, nor do they omit to state any
material fact required to be stated therein necessary to make the
statements made, in light of the circumstances under which they were made,
not misleading.
(h) Absence of Litigation. Except as disclosed
in the SEC Documents, there is no action, suit, proceeding, inquiry or
investigation before or by any court, public board, government agency,
self-regulatory organization or body pending against or affecting the
Company, the Common Stock or any of the Company's subsidiaries, wherein an
unfavorable decision, ruling or finding would (i) have a material adverse
effect on the transactions contemplated hereby (ii) adversely affect the
validity or enforceability of, or the authority or ability of the Company
to perform its obligations under, this Agreement or any of the documents
contemplated herein, or (iii) except as expressly disclosed in the SEC
Documents, have a material adverse effect on the business, operations,
properties, financial condition or results of operations of the Company
and its subsidiaries taken as a whole.
(i) Acknowledgment Regarding Buyer's Purchase of
the Convertible Debenture. The Company acknowledges and agrees that the
Buyer(s) is acting solely in the capacity of an arm's length purchaser
with respect to this Agreement and the transactions contemplated hereby.
The Company further acknowledges that the Buyer(s) is not acting as a
financial advisor or fiduciary of the Company (or in any similar capacity)
with respect to this Agreement and the transactions contemplated hereby
and any advice given by the Buyer(s) or any of their respective
representatives or agents in connection with this Agreement and the
transactions contemplated hereby is merely incidental to such Buyer's
purchase of the Convertible Debenture or the Conversion Shares. The
Company further represents to the Buyer that the Company's decision to
enter into this Agreement has been based solely on the independent
evaluation by the Company and its representatives.
(j) No General Solicitation. Neither the
Company, nor any of its affiliates, nor any person acting on its or their
behalf, has engaged in any form of general solicitation or general
advertising (within the meaning of Regulation D under the Securities Act)
in connection with the offer or sale of the Convertible Debenture or the
Conversion Shares.
(k) No Integrated Offering. Neither the
Company, nor any of its affiliates, nor any person acting on its or their
behalf has, directly or indirectly, made any offers or sales of any
security or solicited any offers to buy any security, under circumstances
that would require registration of the Convertible Debenture or the
Conversion Shares under the Securities Act or cause this offering of the
Convertible Debenture or the Conversion Shares to be integrated with prior
offerings by the Company for purposes of the Securities Act.
(l) Employee Relations. Neither the Company nor
any of its subsidiaries is involved in any labor dispute nor, to the
knowledge of the Company or any of its subsidiaries, is any such dispute
threatened. None of the Company's or its subsidiaries' employees is a
member of a union and the Company and its subsidiaries believe that their
relations with their employees are good.
(m) Intellectual Property Rights. The Company
and its subsidiaries own or possess adequate rights or licenses to use all
trademarks, trade names, service marks, service xxxx registrations,
service names, patents, patent rights, copyrights, inventions, licenses,
approvals, governmental authorizations, trade secrets and rights necessary
to conduct their respective businesses as now conducted. The Company and
its subsidiaries do not have any knowledge of any infringement by the
Company or its subsidiaries of trademark, trade name rights, patents,
patent rights, copyrights, inventions, licenses, service names, service
marks, service xxxx registrations, trade secret or other similar rights of
others, and, to the knowledge of the Company there is no claim, action or
proceeding being made or brought against, or to the Company's knowledge,
being threatened against, the Company or its subsidiaries regarding
trademark, trade name, patents, patent rights, invention, copyright,
license, service names, service marks, service xxxx registrations, trade
secret or other infringement; and the Company and its subsidiaries are
unaware of any facts or circumstances which might give rise to any of the
foregoing.
(n) Environmental Laws. The Company and its
subsidiaries are (i) in compliance with any and all applicable foreign,
federal, state and local laws and regulations relating to the protection
of human health and safety, the environment or hazardous or toxic
substances or wastes, pollutants or contaminants ("Environmental Laws"),
(ii) have received all permits, licenses or other approvals required of
them under applicable Environmental Laws to conduct their respective
businesses and (iii) are in compliance with all terms and conditions of
any such permit, license or approval.
(o) Title. Any real property and facilities
held under lease by the Company and its subsidiaries are held by them
under valid, subsisting and enforceable leases with such exceptions as are
not material and do not interfere with the use made and proposed to be
made of such property and buildings by the Company and its subsidiaries.
(p) Insurance. The Company and each of its
subsidiaries are insured by insurers of recognized financial
responsibility against such losses and risks and in such amounts as
management of the Company believes to be prudent and customary in the
businesses in which the Company and its subsidiaries are engaged. Neither
the Company nor any such subsidiary has been refused any insurance
coverage sought or applied for and neither the Company nor any such
subsidiary has any reason to believe that it will not be able to renew its
existing insurance coverage as and when such coverage expires or to obtain
similar coverage from similar insurers as may be necessary to continue its
business at a cost that would not materially and adversely affect the
condition, financial or otherwise, or the earnings, business or operations
of the Company and its subsidiaries, taken as a whole.
(q) Regulatory Permits. The Company and its
subsidiaries possess all material certificates, authorizations and permits
issued by the appropriate federal, state or foreign regulatory authorities
necessary to conduct their respective businesses, and neither the Company
nor any such subsidiary has received any notice of proceedings relating to
the revocation or modification of any such certificate, authorization or
permit.
(r) Internal Accounting Controls. The Company
and each of its subsidiaries maintain a system of internal accounting
controls sufficient to provide reasonable assurance that (i) transactions
are executed in accordance with management's general or specific
authorizations, (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain asset accountability, and (iii) the
recorded amounts for assets is compared with the existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.
(s) No Material Adverse Breaches, etc. Except
as set forth in the SEC Documents, neither the Company nor any of its
subsidiaries is subject to any charter, corporate or other legal
restriction, or any judgment, decree, order, rule or regulation which in
the judgment of the Company's officers has or is expected in the future to
have a material adverse effect on the business, properties, operations,
financial condition, results of operations or prospects of the Company or
its subsidiaries. Except as set forth in the SEC Documents, neither the
Company nor any of its subsidiaries is in breach of any contract or
agreement which breach, in the judgment of the Company's officers, has or
is expected to have a material adverse effect on the business, properties,
operations, financial condition, results of operations or prospects of the
Company or its subsidiaries.
(t) Tax Status. Except as set forth in the SEC
Documents, the Company and each of its subsidiaries has made and filed all
federal and state income and all other tax returns, reports and
declarations required by any jurisdiction to which it is subject and
(unless and only to the extent that the Company and each of its
subsidiaries has set aside on its books provisions reasonably adequate for
the payment of all unpaid and unreported taxes) has paid all taxes and
other governmental assessments and charges that are material in amount,
shown or determined to be due on such returns, reports and declarations,
except those being contested in good faith and has set aside on its books
provision reasonably adequate for the payment of all taxes for periods
subsequent to the periods to which such returns, reports or declarations
apply. There are no unpaid taxes in any material amount claimed to be due
by the taxing authority of any jurisdiction, and the officers of the
Company know of no basis for any such claim.
(u) Certain Transactions. Except as set forth
in the SEC Documents, and except for arm's length transactions pursuant to
which the Company makes payments in the ordinary course of business upon
terms no less favorable than the Company could obtain from third parties
and other than the grant of stock options disclosed in the SEC Documents,
none of the officers, directors, or employees of the Company is presently
a party to any transaction with the Company (other than for services as
employees, officers and directors), including any contract, agreement or
other arrangement providing for the furnishing of services to or by,
providing for rental of real or personal property to or from, or otherwise
requiring payments to or from any officer, director or such employee or,
to the knowledge of the Company, any corporation, partnership, trust or
other entity in which any officer, director, or any such employee has a
substantial interest or is an officer, director, trustee or partner.
(v) Fees and Rights of First Refusal. The
Company is not obligated to offer the securities offered hereunder on a
right of first refusal basis or otherwise to any third parties including,
but not limited to, current or former shareholders of the Company,
underwriters, brokers, agents or other third parties.
4. COVENANTS.
(a) Best Efforts. Each party shall use its best
efforts to timely satisfy each of the conditions to be satisfied by it as
provided in Sections 6 and 7 of this Agreement.
(b) Form D. The Company agrees to file a Form D
with respect to the Conversion Shares as required under Regulation D and
to provide a copy thereof to each Buyer promptly after such filing. The
Company shall, on or before the Closing Date, take such action as the
Company shall reasonably determine is necessary to qualify the Conversion
Shares, or obtain an exemption for the Conversion Shares for sale to the
Buyers at the Closing pursuant to this Agreement under applicable
securities or "Blue Sky" laws of the states of the United States, and
shall provide evidence of any such action so taken to the Buyers on or
prior to the Closing Date.
(c) Reporting Status. Until the earlier of (i)
the date as of which the Buyer(s) may sell all of the Conversion Shares
without restriction pursuant to Rule 144(k) promulgated under the
Securities Act (or successor thereto), or (ii) the date on which (A) the
Buyer(s) shall have sold all the Conversion Shares and (B) none of the
Convertible Debenture are outstanding (the "Registration Period"), the
Company shall file in a timely manner all reports required to be filed
with the SEC pursuant to the Exchange Act and the regulations of the SEC
thereunder, and the Company shall not terminate its status as an issuer
required to file reports under the Exchange Act even if the Exchange Act
or the rules and regulations thereunder would otherwise permit such
termination.
(d) Use of Proceeds. The Company will use the
proceeds from the sale of the Convertible Debenture for general corporate
and working capital purposes.
(e) Reservation of Shares. The Company shall
take all action reasonably necessary to at all times have authorized, and
reserved for the purpose of issuance, such number of shares of Common
Stock as shall be necessary to effect the issuance of the Conversion
Shares. If at any time the Company does not have available such shares of
Common Stock as shall from time to time be sufficient to effect the
conversion of all of the Conversion Shares, the Company shall call and
hold a special meeting of the shareholders within thirty (30) days of such
occurrence, for the sole purpose of increasing the number of shares
authorized. The Company's management shall recommend to the shareholders
to vote in favor of increasing the number of shares of Common Stock
authorized. Management shall also vote all of its shares in favor of
increasing the number of authorized shares of Common Stock.
(f) Listings or Quotation. The Company shall
promptly secure the listing or quotation of the Conversion Shares upon
each national securities exchange, automated quotation system or The
National Association of Securities Dealers Inc.'s Over-The-Counter
Bulletin Board ("OTCBB") or other market, if any, upon which shares of
Common Stock are then listed or quoted (subject to official notice of
issuance) and shall use its best efforts to maintain, so long as any other
shares of Common Stock shall be so listed, such listing of all Conversion
Shares from time to time issuable under the terms of this Agreement. The
Company shall maintain the Common Stock's authorization for quotation on
the OTCBB.
(g) Fees and Expenses.
(i) Each of the Company and the Buyer(s) shall
pay all costs and expenses incurred by such party in connection with the
negotiation, investigation, preparation, execution and delivery of the
Transaction Documents. The Company shall pay Yorkville Advisors
Management LLC a fee equal to One Hundred Thousand Dollars ($100,000)
directly from the gross proceeds of the Closing.
(ii) The Company shall pay a structuring fee to
Yorkville Advisors Management, LLC of Ten Thousand Dollars ($10,000),
which shall be paid directly from the proceeds of the Closing.
(iii) The Company shall issue to the Buyer a
warrant to purchase five million (5,000,000) shares of the Company's
Common Stock (the "Warrant Shares") for a period of three (3) years at an
exercise price of $0.20 per share. The Warrant Shares shall have "piggy-
back" and demand registration rights.
(h) Corporate Existence. So long as any of the
Convertible Debenture remain outstanding, the Company shall not directly
or indirectly consummate any merger, reorganization, restructuring,
reverse stock split consolidation, sale of all or substantially all of the
Company's assets or any similar transaction or related transactions (each
such transaction, an "Organizational Change") unless, prior to the
consummation an Organizational Change, the Company obtains the written
consent of each Buyer. In any such case, the Company will make
appropriate provision with respect to such holders' rights and interests
to insure that the provisions of this Section 4(h) will thereafter be
applicable to the Convertible Debenture.
(i) Transactions With Affiliates. So long as
any Convertible Debenture are outstanding, the Company shall not, and
shall cause each of its subsidiaries not to, enter into, amend, modify or
supplement, or permit any subsidiary to enter into, amend, modify or
supplement any agreement, transaction, commitment, or arrangement with any
of its or any subsidiary's officers, directors, person who were officers
or directors at any time during the previous two (2) years, stockholders
who beneficially own five percent (5%) or more of the Common Stock, or
Affiliates (as defined below) or with any individual related by blood,
marriage, or adoption to any such individual or with any entity in which
any such entity or individual owns a five percent (5%) or more beneficial
interest (each a "Related Party"), except for (a) customary employment
arrangements and benefit programs on reasonable terms, (b) any investment
in an Affiliate of the Company, (c) any agreement, transaction,
commitment, or arrangement on an arms-length basis on terms no less
favorable than terms which would have been obtainable from a person other
than such Related Party, (d) any agreement, transaction, commitment, or
arrangement which is approved by a majority of the disinterested directors
of the Company; for purposes hereof, any director who is also an officer
of the Company or any subsidiary of the Company shall not be a
disinterested director with respect to any such agreement, transaction,
commitment, or arrangement. "Affiliate" for purposes hereof means, with
respect to any person or entity, another person or entity that, directly
or indirectly, (i) has a ten percent (10%) or more equity interest in that
person or entity, (ii) has ten percent (10%) or more common ownership with
that person or entity, (iii) controls that person or entity, or
(iv) shares common control with that person or entity. "Control" or
"controls" for purposes hereof means that a person or entity has the
power, direct or indirect, to conduct or govern the policies of another
person or entity.
(j) Transfer Agent. The Company covenants and
agrees that, in the event that the Company's agency relationship with the
transfer agent should be terminated for any reason prior to a date which
is two (2) years after the Closing Date, the Company shall immediately
appoint a new transfer agent and shall require that the new transfer agent
execute and agree to be bound by the terms of the Irrevocable Transfer
Agent Instructions (as defined herein).
(k) Restriction on Issuance of the Capital
Stock. So long as any Convertible Debenture are outstanding, the Company
shall not, without the prior written consent of the Buyer(s), (i) issue or
sell shares of Common Stock or Preferred Stock without consideration or
for a consideration per share less than the bid price of the Common Stock
determined immediately prior to its issuance, (ii) issue any warrant,
option, right, contract, call, or other security instrument granting the
holder thereof, the right to acquire Common Stock without consideration or
for a consideration less than such Common Stock's Bid Price value
determined immediately prior to it's issuance, (iii) enter into any
security instrument granting the holder a security interest in any and all
assets of the Company, or (iv) file any registration statement on Form S-8.
(l) Neither the Buyer(s) nor any of its
affiliates have an open short position in the Common Stock of the Company,
and the Buyer(s) agrees that it shall not, and that it will cause its
affiliates not to, engage in any short sales of or hedging transactions
with respect to the Common Stock as long as any Convertible Debenture or
warrants to purchase the Warrant Shares shall remain outstanding.
5. TRANSFER AGENT INSTRUCTIONS.
(a) The Company shall issue the Irrevocable
Transfer Agent Instructions to its transfer agent irrevocably appointing
Xxxxx Xxxxxxxx, Esq. as the Company's agent for purpose of having
certificates issued, registered in the name of the Buyer(s) or its
respective nominee(s), for the Conversion Shares representing such amounts
of Convertible Debenture as specified from time to time by the Buyer(s) to
the Company upon conversion of the Convertible Debenture, for interest
owed pursuant to the Convertible Debenture, and for any and all Liquidated
Damages (as this term is defined in the Investor Registration Rights
Agreement). Xxxxx Xxxxxxxx, Esq. shall be paid a cash fee of Fifty
Dollars ($50) for every occasion they act pursuant to the Irrevocable
Transfer Agent Instructions. The Company shall not change its transfer
agent without the express written consent of the Buyer(s), which may be
withheld by the Buyer(s) in its sole discretion. Prior to registration of
the Conversion Shares under the Securities Act, all such certificates
shall bear the restrictive legend specified in Section 2(g) of this
Agreement. The Company warrants that no instruction other than the
Irrevocable Transfer Agent Instructions referred to in this Section 5, and
stop transfer instructions to give effect to Section 2(g) hereof (in the
case of the Conversion Shares prior to registration of such shares under
the Securities Act) will be given by the Company to its transfer agent and
that the Conversion Shares shall otherwise be freely transferable on the
books and records of the Company as and to the extent provided in this
Agreement and the Investor Registration Rights Agreement. Nothing in this
Section 5 shall affect in any way the Buyer's obligations and agreement to
comply with all applicable securities laws upon resale of Conversion
Shares. If the Buyer(s) provides the Company with an opinion of counsel,
in form, scope and substance customary for opinions of counsel in
comparable transactions to the effect that registration of a resale by the
Buyer(s) of any of the Conversion Shares is not required under the
Securities Act, the Company shall within two (2) business days instruct
its transfer agent to issue one or more certificates in such name and in
such denominations as specified by the Buyer. The Company acknowledges
that a breach by it of its obligations hereunder will cause irreparable
harm to the Buyer by vitiating the intent and purpose of the transaction
contemplated hereby. Accordingly, the Company acknowledges that the
remedy at law for a breach of its obligations under this Section 5 will be
inadequate and agrees, in the event of a breach or threatened breach by
the Company of the provisions of this Section 5, that the Buyer(s) shall
be entitled, in addition to all other available remedies, to an injunction
restraining any breach and requiring immediate issuance and transfer,
without the necessity of showing economic loss and without any bond or
other security being required.
6. CONDITIONS TO THE COMPANY'S OBLIGATION TO SELL.
The obligation of the Company hereunder to issue and sell the
Convertible Debenture to the Buyer(s) at the Closings is subject to the
satisfaction, at or before the Closing Date, of each of the following
conditions, provided that these conditions are for the Company's sole
benefit and may be waived by the Company at any time in its sole
discretion:
(a) Each Buyer shall have executed the
Transaction Documents and delivered them to the Company.
(b) The Buyer(s) shall have delivered to the
Escrow Agent the Purchase Price for Convertible Debenture in respective
amounts as set forth next to each Buyer as outlined on Schedule I attached
hereto and the Escrow Agent shall have delivered the net proceeds to the
Company by wire transfer of immediately available U.S. funds pursuant to
the wire instructions provided by the Company.
(c) The representations and warranties of the
Buyer(s) shall be true and correct in all material respects as of the date
when made and as of the Closing Date as though made at that time (except
for representations and warranties that speak as of a specific date), and
the Buyer(s) shall have performed, satisfied and complied in all material
respects with the covenants, agreements and conditions required by this
Agreement to be performed, satisfied or complied with by the Buyer(s) at
or prior to the Closing Date.
7. CONDITIONS TO THE BUYER'S OBLIGATION TO PURCHASE.
(a) The obligation of the Buyer(s) hereunder to
Purchase the Convertible Debenture at the Closing is subject to the
satisfaction, at or before the Closing Date, of each of the following
conditions:
(i) The Company shall have executed the
Transaction Documents and delivered the same to the Buyer(s).
(ii) The Common Stock shall be authorized for
quotation on the OTCBB, trading in the Common Stock shall not have been
suspended for any reason, and all the Conversion Shares issuable upon the
conversion of the Convertible Debenture shall be approved by the OTCBB.
(iii) The representations and warranties of the
Company shall be true and correct in all material respects (except to the
extent that any of such representations and warranties is already
qualified as to materiality in Section 3 above, in which case, such
representations and warranties shall be true and correct without further
qualification) as of the date when made and as of the Closing Date as
though made at that time (except for representations and warranties that
speak as of a specific date) and the Company shall have performed,
satisfied and complied in all material respects with the covenants,
agreements and conditions required by this Agreement to be performed,
satisfied or complied with by the Company at or prior to the Closing Date.
If requested by the Buyer, the Buyer shall have received a certificate,
executed by the President of the Company, dated as of the Closing Date, to
the foregoing effect and as to such other matters as may be reasonably
requested by the Buyer including, without limitation an update as of the
Closing Date regarding the representation contained in Section 3(c) above.
(iv) The Company shall have executed and
delivered to the Buyer(s) the Convertible Debenture in the respective
amounts set forth opposite each Buyer(s) name on Schedule I attached
hereto.
(v) The Buyer(s) shall have received an
opinion of counsel from counsel to the Company in a form satisfactory to the
Buyer(s).
(vi) The Company shall have provided to the
Buyer(s) a certificate of good standing from the secretary of state from
the state in which the company is incorporated.
(vii) The Company and the Subsidiary shall have
filed a form UCC-1 or such other forms as may be required to perfect the
Buyer's interest in the Pledged Property as detailed in the Security
Agreement dated the date hereof and provided proof of such filing to the
Buyer(s).
(viii) The Company shall have provided to the
Buyer an acknowledgement, to the satisfaction of the Buyer, from the
Company's independent certified public accountants as to its ability to
provide all consents required in order to file a registration statement in
connection with this transaction.
(ix) The Company shall have reserved out of its
authorized and unissued Common Stock, solely for the purpose of effecting
the conversion of the Convertible Debenture, shares of Common Stock to
effect the conversion of all of the Conversion Shares then outstanding.
(x) The Irrevocable Transfer Agent Instructions,
in form and substance satisfactory to the Buyer, shall have been delivered
to and acknowledged in writing by the Company's transfer agent.
8. INDEMNIFICATION.
(a) In consideration of the Buyer's execution
and delivery of this Agreement and acquiring the Convertible Debenture and
the Conversion Shares hereunder, and in addition to all of the Company's
other obligations under this Agreement, the Company shall defend, protect,
indemnify and hold harmless the Buyer(s) and each other holder of the
Convertible Debenture and the Conversion Shares, and all of their
officers, directors, employees and agents (including, without limitation,
those retained in connection with the transactions contemplated by this
Agreement) (collectively, the "Buyer Indemnitees") from and against any
and all actions, causes of action, suits, claims, losses, costs,
penalties, fees, liabilities and damages, and expenses in connection
therewith (irrespective of whether any such Buyer Indemnitee is a party to
the action for which indemnification hereunder is sought), and including
reasonable attorneys' fees and disbursements (the "Indemnified
Liabilities"), incurred by the Buyer Indemnitees or any of them as a
result of, or arising out of, or relating to (a) any misrepresentation or
breach of any representation or warranty made by the Company in this
Agreement, the Convertible Debenture or the Investor Registration Rights
Agreement or any other certificate, instrument or document contemplated
hereby or thereby, (b) any breach of any covenant, agreement or obligation
of the Company contained in this Agreement, or the Investor Registration
Rights Agreement or any other certificate, instrument or document
contemplated hereby or thereby, or (c) any cause of action, suit or claim
brought or made against such Indemnitee and arising out of or resulting
from the execution, delivery, performance or enforcement of this Agreement
or any other instrument, document or agreement executed pursuant hereto by
any of the parties hereto, any transaction financed or to be financed in
whole or in part, directly or indirectly, with the proceeds of the
issuance of the Convertible Debenture or the status of the Buyer or holder
of the Convertible Debenture the Conversion Shares, as a Buyer of
Convertible Debenture in the Company. To the extent that the foregoing
undertaking by the Company may be unenforceable for any reason, the
Company shall make the maximum contribution to the payment and
satisfaction of each of the Indemnified Liabilities, which is permissible
under applicable law.
(b) In consideration of the Company's execution
and delivery of this Agreement, and in addition to all of the Buyer's
other obligations under this Agreement, the Buyer shall defend, protect,
indemnify and hold harmless the Company and all of its officers,
directors, employees and agents (including, without limitation, those
retained in connection with the transactions contemplated by this
Agreement) (collectively, the "Company Indemnitees") from and against any
and all Indemnified Liabilities incurred by the Indemnitees or any of them
as a result of, or arising out of, or relating to (a) any
misrepresentation or breach of any representation or warranty made by the
Buyer(s) in this Agreement, instrument or document contemplated hereby or
thereby executed by the Buyer, (b) any breach of any covenant, agreement
or obligation of the Buyer(s) contained in this Agreement, the Investor
Registration Rights Agreement or any other certificate, instrument or
document contemplated hereby or thereby executed by the Buyer, or (c) any
cause of action, suit or claim brought or made against such Company
Indemnitee based on material misrepresentations or due to a material
breach and arising out of or resulting from the execution, delivery,
performance or enforcement of this Agreement, the Investor Registration
Rights Agreement or any other instrument, document or agreement executed
pursuant hereto by any of the parties hereto. To the extent that the
foregoing undertaking by each Buyer may be unenforceable for any reason,
each Buyer shall make the maximum contribution to the payment and
satisfaction of each of the Indemnified Liabilities, which is permissible
under applicable law.
9. GOVERNING LAW: MISCELLANEOUS.
(a) Governing Law. This Agreement shall be
governed by and interpreted in accordance with the laws of the State of
New Jersey without regard to the principles of conflict of laws. The
parties further agree that any action between them shall be heard in
Xxxxxx County, New Jersey, and expressly consent to the jurisdiction and
venue of the Superior Court of New Jersey, sitting in Xxxxxx County and
the United States District Court for the District of New Jersey sitting in
Newark, New Jersey for the adjudication of any civil action asserted
pursuant to this Paragraph.
(b) Counterparts. This Agreement may be
executed in two or more identical counterparts, all of which shall be
considered one and the same agreement and shall become effective when
counterparts have been signed by each party and delivered to the other
party. In the event any signature page is delivered by facsimile
transmission, the party using such means of delivery shall cause four (4)
additional original executed signature pages to be physically delivered to
the other party within five (5) days of the execution and delivery hereof.
(c) Headings. The headings of this Agreement
are for convenience of reference and shall not form part of, or affect the
interpretation of, this Agreement.
(d) Severability. If any provision of this
Agreement shall be invalid or unenforceable in any jurisdiction, such
invalidity or unenforceability shall not affect the validity or
enforceability of the remainder of this Agreement in that jurisdiction or
the validity or enforceability of any provision of this Agreement in any
other jurisdiction.
(e) Entire Agreement, Amendments. This
Agreement supersedes all other prior oral or written agreements between
the Buyer(s), the Company, their affiliates and persons acting on their
behalf with respect to the matters discussed herein, and this Agreement
and the instruments referenced herein contain the entire understanding of
the parties with respect to the matters covered herein and therein and,
except as specifically set forth herein or therein, neither the Company
nor any Buyer makes any representation, warranty, covenant or undertaking
with respect to such matters. No provision of this Agreement may be
waived or amended other than by an instrument in writing signed by the
party to be charged with enforcement.
(f) Notices. Any notices, consents, waivers, or
other communications required or permitted to be given under the terms of
this Agreement must be in writing and will be deemed to have been
delivered (i) upon receipt, when delivered personally; (ii) upon
confirmation of receipt, when sent by facsimile; (iii) three (3) days
after being sent by U.S. certified mail, return receipt requested, or (iv)
one (1) day after deposit with a nationally recognized overnight delivery
service, in each case properly addressed to the party to receive the same.
The addresses and facsimile numbers for such communications shall be:
If to the Company, to:
Global Concepts, Ltd.
00 Xxxxxxxx Xxx Xxxx
Xxxxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
With a copy to:
Xxxxxx Xxxxxx, Esq,
000 0xx Xxxxxx
Xxxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to the Buyer(s), to its address and facsimile number on Schedule
I, with copies to the Buyer's counsel as set forth on Schedule I. Each
party shall provide five (5) days' prior written notice to the other party
of any change in address or facsimile number.
(g) Successors and Assigns. This Agreement
shall be binding upon and inure to the benefit of the parties and their
respective successors and assigns. Neither the Company nor any Buyer
shall assign this Agreement or any rights or obligations hereunder without
the prior written consent of the other party hereto.
(h) No Third Party Beneficiaries. This
Agreement is intended for the benefit of the parties hereto and their
respective permitted successors and assigns, and is not for the benefit
of, nor may any provision hereof be enforced by, any other person.
(i) Survival. Unless this Agreement is
terminated under Section 9(l), the representations and warranties of the
Company and the Buyer(s) contained in Sections 2 and 3, the agreements and
covenants set forth in Sections 4, 5 and 9, and the indemnification
provisions set forth in Section 8, shall survive the Closing for a period
of two (2) years following the date on which the Convertible Debenture are
converted in full. The Buyer(s) shall be responsible only for its own
representations, warranties, agreements and covenants hereunder.
(j) Publicity. The Company and the Buyer(s)
shall have the right to approve, before issuance any press release or any
other public statement with respect to the transactions contemplated
hereby made by any party; provided, however, that the Company shall be
entitled, without the prior approval of the Buyer(s), to issue any press
release or other public disclosure with respect to such transactions
required under applicable securities or other laws or regulations (the
Company shall use its best efforts to consult the Buyer(s) in connection
with any such press release or other public disclosure prior to its
release and Buyer(s) shall be provided with a copy thereof upon release
thereof).
(k) Further Assurances. Each party shall do and
perform, or cause to be done and performed, all such further acts and
things, and shall execute and deliver all such other agreements,
certificates, instruments and documents, as the other party may reasonably
request in order to carry out the intent and accomplish the purposes of
this Agreement and the consummation of the transactions contemplated
hereby.
(l) Termination. In the event that the Closing
shall not have occurred with respect to the Buyers on or before five (5)
business days from the date hereof due to the Company's or the Buyer's
failure to satisfy the conditions set forth in Sections 6 and 7 above (and
the non-breaching party's failure to waive such unsatisfied condition(s)),
the non-breaching party shall have the option to terminate this Agreement
with respect to such breaching party at the close of business on such date
without liability of any party to any other party; provided, however, that
if this Agreement is terminated by the Company pursuant to this Section
9(l), the Company shall remain obligated to reimburse the Buyer(s) for the
fees and expenses of Yorkville Advisors Management, LLC described in
Section 4(g) above.
(m) No Strict Construction. The language used
in this Agreement will be deemed to be the language chosen by the parties
to express their mutual intent, and no rules of strict construction will
be applied against any party.
[REMAINDER PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the Buyers and the Company have caused this
Securities Purchase Agreement to be duly executed as of the date first
written above.
COMPANY:
GLOBAL CONCEPTS, LTD.
By: /s/ Xxxxxxx Xxxxxxxxx
-------------------------
Name: Xxxxxxx Xxxxxxxxx
Title: Chief Executive Officer
SCHEDULE I
----------
SCHEDULE OF BUYERS
------------------
Address/Facsimile Amount of
Name Signature Number of Buyer Subscription
-------------------------------------------------------------------------------------------------------------
Cornell Capital Partners, LP By: Yorkville Advisors, LLC 000 Xxxxxx Xxxxxx - Xxxxx 0000 $2,500,000
Its: General Partner Xxxxxx Xxxx, XX 00000
Facsimile: (000) 000-0000
By: /s/ Xxxx Xxxxxx
Name: Xxxx Xxxxxx
Its: Portfolio Manager
With a copy to:
Xxxxx Xxxxxxxx, Esq. 000 Xxxxxx Xxxxxx - Xxxxx 0000
Xxxxxx Xxxx, XX 00000
Facsimile: (000) 000-0000
