SUBSCRIPTION AGREEMENT
Exhibit 10.4
This
Subscription Agreement (the “Agreement”) relates to the Series
B round private placement of Super League Gaming, Inc., a Delaware
corporation, with a principal place of business located at 0000
Xxxxxxxx Xxx., Xxxxx 000, Xxxxx Xxxxxx, XX 00000 (the "Company"), consisting of up to One
Million Six Hundred Sixty-Six Thousand Six Hundred Sixty-Six
(1,666,666) shares of common stock, at a price of $3.00 USD per
share (the “Shares”), for a total offering of
Five Million Dollars ($5,000,000 USD)(the “Offering”).
The
undersigned purchaser (“Purchaser” or “Investor”) hereby subscribes to
purchase the number of Shares set forth in Section 1(a)
below.
1.
Subscription.
(a)
Shares Subscription.
Subject to the acceptance hereof by an authorized representative of
the Company, the Purchaser hereby subscribes for ______________
(________) Shares at a price of $3.00 USD per share, for an
investment of ____________________________ ($___________) (the
“Cash
Consideration”).
(b)
Cash Consideration. The
Purchaser agrees that payment of the Cash Consideration shall be
made on the date of acceptance of this Subscription Agreement by an
authorized representative or a member of the Company either (i) via
check made payable to “Super League Gaming, Inc.”, or
(ii) preferably via wire transfer as follows:
Xxxxx
Fargo Bank, N.A.
00000
Xxx Xxxxxxx Xxxx.
Xxx
Xxxxxxx, XX 00000
Routing
Number: 000000000
Account
Number: 6158312352
Account
Name: Super League Gaming, Inc.
2.
Representations
and Warranties. The Purchaser hereby represents and warrants
that:
(a)
Information. In making the
decision to purchase the Shares, the Purchaser has relied on an
independent investigation made by the Purchaser and/or on the
advice given to the Purchaser by the Purchaser's own counsel,
accountant or other advisers. The Purchaser further represents that
the Purchaser and his, her or its advisors have had the opportunity
to ask questions and receive answers concerning the terms and
conditions of the offering of the Shares and to obtain any
additional information necessary to evaluate this investment and to
verify the accuracy of the information otherwise furnished to the
Purchaser and his or her advisers.
(b)
Distribution. The Purchaser
has not reproduced or distributed this Agreement to any person
other than the Purchaser's counsel, accountant or other
adviser.
(c)
Registration or
Qualification. The Purchaser is aware that the Shares have
not been registered under the Securities Act of 1933, as amended
(the "Act"), or qualified
under any other securities law or regulation.
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(d)
Own Account. The Purchaser
is acquiring the Shares solely for the Purchaser's own account and
not for the account of any other person, for investment only, and
not with a view to resale, assignment or distribution.
(e)
Economic Risk. The
Purchaser is able to bear the economic risk of this investment, can
afford to hold the Shares for an indefinite period and can afford a
complete loss of the investment.
(f)
Appropriate Risks. The
Purchaser has evaluated the risks of investing in the Company in
light of the foregoing and is satisfied that the investment is
appropriate for the Purchaser.
(g)
Information True. All
information which the Purchaser has provided to the Company
concerning the Purchaser, his, her or its financial position, his,
her or its status as an accredited investor, his, her or its
knowledge of financial and business matters, all statements and
representations as contained herein are correct and complete and if
there should be any material change in such information prior to
this subscription being accepted, the Purchaser will immediately
provide the Company with such information.
(h)
Restricted Securities. The
Purchaser understands that the Shares are characterized as
"restricted securities" under the federal securities laws inasmuch
as they are being acquired in a transaction not involving a public
offering and that under such laws and applicable regulations the
Shares may be resold without registration under the Act only in
certain limited circumstances and that otherwise the Shares must be
held indefinitely. In this connection, the Purchaser represents
that he/she is familiar with Securities and Exchange Commission
Rule 144, as presently in effect, and the conditions which must be
met in order for that Rule to be available for resale of
"restricted securities", and understands that resale limitations
are imposed by the Act.
(i)
Disposition. Without in any
way limiting the representations set forth above, the Purchaser
agrees not to make any disposition of all or any portion of the
Shares unless and until:
(x)
there is then in effect a registration statement under the Act
covering such proposed disposition and such disposition is made in
accordance with such registration statement and any applicable
requirements of state securities laws; or
(y) (1)
the Purchaser shall have notified the Company of the proposed
disposition and shall have furnished the Company with a detailed
statement of the circumstances surrounding the proposed
disposition; and (2) the Purchaser shall have furnished the Company
with an opinion of counsel, reasonably satisfactory to the Company,
that such disposition will not require registration of such Shares
under the Act or the consent of or permission from appropriate
authorities under any applicable state securities law.
(j)
Legends. It is understood
that the certificate evidencing the Shares may bear the following
legends:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE
BEEN ACQUIRED FOR INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933. SUCH SHARES MAY NOT BE SOLD OR TRANSFERRED
OR PLEDGED IN THE ABSENCE OF SUCH REGISTRATION UNLESS THE COMPANY
RECEIVES AN OPINION OF COUNSEL REASONABLY ACCEPTABLE TO THE COMPANY
STATING THAT SUCH SALE OR TRANSFER IS EXEMPT FROM THE REGISTRATION
AND PROSPECTUS DELIVERY REQUIREMENTS OF SAID ACT. COPIES OF THE
AGREEMENT, IF ANY, COVERING THE PURCHASE OF THESE SHARES AND
RESTRICTING THEIR TRANSFER MAY BE OBTAINED AT NO COST BY WRITTEN
REQUEST MADE BY THE HOLDER OF RECORD OF THIS CERTIFICATE TO THE
SECRETARY OF THE COMPANY AT THE PRINCIPAL EXECUTIVE OFFICES OF THE
COMPANY.
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(k)
Accredited Investor. The
undersigned purchaser is an accredited investor as defined in Rule
501(a) of Regulation D promulgated under the Securities Act. The
Purchaser is an investor in securities of companies in the
development stage and acknowledges that he, she or it is able to
fend for itself, can bear the economic risk of its investment, and
has such knowledge and experience in financial or business matters
that it is capable of evaluating the merits and risks of the
investment in the Shares. If other than an individual, the
Purchaser also represents it has not been organized for the purpose
of acquiring the Shares.
(x) Purchaser Suitability. The
Purchaser represents and warrants that the Purchaser comes within
one or more of the categories marked below, and that for any
category marked the Purchaser has truthfully set forth the factual
basis or reason the Investor comes within that category. ALL
INFORMATION IN RESPONSE TO THIS SECTION WILL BE KEPT STRICTLY
CONFIDENTIAL, EXCEPT FOR DISCLOSURES TO FEDERAL OR STATE REGULATORY
AUTHORITIES. The Purchaser agrees to furnish any additional
information that the Company deems necessary in order to verify the
answers set forth below.
Category
I
The Purchaser is an
individual (not a partnership, corporation, etc.) whose individual
net worth, or joint net worth with the Purchaser’s spouse,
presently exceeds $1,000,000, exclusive of the
Purchaser’s primary residence. In the calculation of net
worth (the amount of assets in excess of liabilities):
●
The Purchaser may
include equity in personal property and real estate, expressly
excluding the
Investor’s principal residence, cash, short-term investments,
stocks and securities. Equity in personal property and real estate
should be based on the fair market value of such property less debt
secured by such property.
●
The amount of debt
secured by the primary residence, up to its estimated fair market
value, is not included as a liability, unless the person incurred
debt within 60 days before buying securities in the unregistered
offering for the purpose of buying those securities and not for
buying the residence. In that situation, the amount of debt
borrowed during that 60-day period must be included as a
liability.
●
Any debt secured by
the primary residence in excess of the estimated fair market value
of the home is included as a liability.
Category
II
The Purchaser is an
individual (not a partnership, corporation, etc.) who had an
individual income in excess of $200,000 in 2013 and 2014, or joint
income with his/her spouse in excess of $300,000 in 2013 and 2014,
and has a reasonable expectation of reaching that income level in
2015.
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Category
III
The Purchaser is a
bank, savings and loan, insurance company; registered broker or
dealer, registered investment company; registered business
development company; licensed small business investment company; or
employee benefit plan within the meaning of Title I of ERISA whose
plan fiduciary is either a bank, savings and loan, insurance
company or registered investment advisor or whose total assets
exceed $5,000,000.
________________________________________________________________________________
(describe
entity)
Category
IV
The Purchaser is a
private business development company as defined in Section
202(a)(22) of the Investment Advisers Act of 1940.
________________________________________________________________________________
(describe
entity)
Category
V
The Purchaser is a
non-profit organization within the meaning of Section 501(c)(3) of
the Internal Revenue Code, corporation, business trust, or
partnership, not formed for the purpose of acquiring the securities
offered, with total assets in excess of $5,000,000.
________________________________________________________________________________
(describe
entity)
Category
VI
The Purchaser is a
trustee for a trust that is revocable by the grantor at any time
(including an XXX) and the grantor qualified under either Category
I or Category II above. A copy of the declaration of trust or trust
agreement and a representation as to the net worth or income of the
grantor is enclosed.
Category
VII
The Purchaser is an
entity all the equity owners of which are “accredited
investors” within one or more of the above categories, other
than Category IV or Category V. If
relying upon this category alone, each equity owner must complete a
separate copy of this Agreement.
The Purchaser should check the Office of Foreign Assets Control
(“OFAC”) website at xxx.xxxxx.xxx/xxxx before making
the following representations in subsections (l), (m) and (n)
below:
(l)
The Purchaser represents that the amount invested in the Company is
not directly or indirectly derived from activities that contravene
federal, state or international laws and regulations, including
anti-money laundering laws and regulations. Federal regulations and
Executive Orders administered by OFAC prohibit, among other things,
the engagement in transactions with, and the provision of services
to, certain foreign countries, territories, entities and
individuals. The lists of OFAC prohibited countries, territories,
persons and entities can be found on the OFAC website at
xxx.xxxxx.xxx/xxxx. In addition, the programs administered by OFAC
(the “OFAC
Programs”) prohibit dealing with individuals or
entities in certain countries regardless of whether such
individuals or entities appear on the OFAC lists;
(m)
To the best of the Purchaser’s knowledge, neither the
Purchaser nor any person controlled by the Purchaser is an
individual or entity named on an OFAC list, or a person or entity
prohibited under the OFAC Programs. Please be advised that the
Company may not accept any amounts from a prospective investor if
such prospective investor cannot make the representation set forth
in the preceding sentence. The Purchaser agrees to promptly notify
the Company should the Purchaser become aware of any change in the
information set forth in these representations. The Purchaser
understands and acknowledges that, by law, the Company may be
obligated to “freeze the account” of the Purchaser, by
declining any redemption requests and/or segregating the assets in
the account in compliance with governmental regulations. The
Purchaser further acknowledges that the Company may, by written
notice to the Purchaser, suspend the redemption rights, if any, of
the Purchaser if the Company reasonably deems it necessary to do so
to comply with anti-money laundering regulations applicable to the
Company or any of the Company’s service providers;
and
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(n)
To the best of the Purchaser’s knowledge, neither the
Purchaser nor any person controlling the Purchaser is a senior
foreign political figure, or any immediate family member or close
associate of a senior foreign political figure, as such terms are
defined in the footnotes hereto.
(o)
Disqualification. The
Purchaser represents that neither such Purchaser, nor any person or
entity with whom such Purchaser shares beneficial ownership of any
Securities, is subject to any of the “Bad Actor”
disqualifications described in Rule 506(d)(1)(i) to (viii) under
the Securities Act of 1933, as amended.
3.
Indemnification. The
undersigned Purchaser agrees to indemnify, defend and hold harmless
members of the Board of Directors, the Company and each of its
officers, members, employees, affiliates, anyone acting on behalf
of the Company or the Board of Directors and any person who
controls any of them (each an “Indemnified Party"), from and against
all damages, losses, costs and expenses (including without
limitation any and all expenses whatsoever reasonably incurred in
investigating, preparing or defending against any litigation
commenced or threatened or any claim whatsoever), including without
limitation reasonable attorneys' fees and expenses, which an
Indemnified Party may incur arising out of or based upon any false
representation or warranty of the undersigned or breach by the
undersigned or the failure of the undersigned to fulfill any of the
terms and conditions of this Subscription Agreement or any other
document furnished by the undersigned to any Indemnified Party in
connection with the undersigned's purchase of the
Shares.
4.
Independence of
Obligations. The undersigned agrees that its, his or her
obligations hereunder shall not be contingent upon or affected by
the similar undertakings of any other investor under its
subscription agreement and that the Company may proceed to enforce
this Agreement without also proceeding to enforce any other
investor's subscription agreement.
5.
Notice.
All notices and other communications given or made pursuant to this
Agreement shall be in writing and shall be deemed effectively given
upon the earlier of actual receipt or: (a) personal delivery to the
party to be notified, (b) when sent, if sent by facsimile or email
during normal business hours of the recipient, and if not sent
during normal business hours, then on the recipient’s next
business day, (c) five (5) days after having been sent by
registered or certified mail, return receipt requested, postage
prepaid, or (d) one (1) business day after deposit with a
nationally recognized overnight courier, freight prepaid,
specifying next business day delivery, with written verification of
receipt. All communications shall be sent to the respective parties
at their address as set forth on the signature page, or to such
address or facsimile number as subsequently modified by written
notice given in accordance with this Agreement. If notice is given
to the Company, it shall be sent to the address listed in the
preamble hereto.
With respect to any notice given by the Company under any provision
of the Delaware General Corporation Law or the Company’s
certificate of incorporation or bylaws (as they may be amended),
Purchaser agrees that such notice may be given by facsimile or by
electronic mail or by any other electronic transmission authorized
under the Delaware General Corporate Law.
6. Pro-Rata Rights in Future
Financings. Investors shall have the right to participate in
future equity financings of the Company to maintain their
respective ownership in the Company that exists upon the close of
the Offering (“Pro-Rata Rights”). The Pro-Rata Rights
shall conclude immediately prior to an initial public offering of
the Company.
7. Residency; Domicile. The state
of residence or domiciliary in the case of an entity, and the state
in which the decision to invest was made:
________________________________________________________________________________
8. Registration of the Securities.
The Shares subscribed for herein should be registered as
follows:
________________________________________________________________________________
Please
print above the exact name(s) in which the Securities are to be
held.
[SIGNATURE
PAGE FOLLOWS]
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SIGNATURE
The
Purchaser hereby represents that he/she/it has read the entire
Subscription Agreement and by their signature below agrees to the
terms hereof.
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ACCEPTANCE
The
subscription for the Shares is hereby accepted by Super League
Gaming, Inc., a Delaware corporation, as of the date set forth
below.
By:
____________________________
Xxx Xxxx
Chief Executive
Officer
Date:
____________________________
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