SECURITIES PURCHASE AGREEMENT
THIS SECURITIES PURCHASE AGREEMENT (this Agreement) is made as of the later date set forth on the signature pages hereto, by and among Spindle, Inc., a Nevada corporation (the Company), and the purchaser whose name and address are set forth on the signature page annexed hereto (the Purchaser). The foregoing parties are sometimes referred to hereinafter individually as a Party or collectively as the Parties.
WHEREAS, pursuant to the Subscription Application of the Purchaser of even date herewith (each a Subscription Application), and pursuant to Section 4(2) of the Securities Act of 1933, as amended (the Securities Act), and Rule 506 promulgated thereunder, the Company desires to sell to the Purchaser and the Purchaser desires to acquire from the Company that number of shares of the Companys common stock, par value $0.001 per share (the Common Stock) as are set forth on the Purchasers signature page annexed hereto (the "Shares"), at a price of $.135 per share, subject to the terms and conditions of this Agreement and the other documents or instruments contemplated hereby.
NOW, THEREFORE, in consideration of the mutual covenants and agreements hereinafter set forth, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties do hereby covenant and agree as follows:
Sale and Issuance of Shares.
Subject to the terms and conditions of this Agreement, the Companys board of directors has authorized the sale and issuance of up to 7,407,408 shares of Common Stock (the Offering). At the Closing (as defined below), the Company shall sell and issue the Shares to the Purchaser, and the Purchaser shall purchase the Shares from the Company. The Company intends to enter into this same form of purchase agreement with certain other purchasers (collectively, the Other Purchasers, and collectively with the Purchaser, the Purchasers) and expects to complete sales of Shares to them. The maximum number of Shares that the Company may sell to the Purchasers is 11,111,112, unless a higher amount is authorized by the Companys board of directors in its sole discretion. The Purchasers obligations hereunder are expressly not subject to or conditioned on the purchase of Shares by any or all of such Other Purchasers.
The aggregate purchase price for the Shares to be purchased by the Purchaser (the Purchase Price) shall be the amount set forth on the Purchasers signature page hereto.
The closing of the sale and issuance to the Purchaser (the Closing) shall occur on the date when the Company receives from the Purchaser (i) this Agreement, Purchaser's Subscription Application and each other document or instrument contemplated hereby or thereby (collectively, the "Transaction Documents") executed by Purchaser; and (ii) payment of the Purchase Price, which shall be made contemporaneously with the execution and delivery of the Transaction Documents, by certified check payable to "Spindle, Inc." or by wire transfer of immediately available funds, to Wells Fargo Bank in accordance with the following instructions:
Wire Transfer Instructions for Account
Wells Fargo Bank, NA
San Francisco, CA 94104
Account Holder; Spindle, Inc.
ABA/Routing Number: XXXXX
Account Number: XXXXXX
At the Closing, the Company shall instruct its transfer agent to issue and deliver to the Purchaser a certificate representing the Shares, against receipt by the Company of a certified bank check or wire transfer in an aggregate amount equal to the Purchase Price for the number of Shares set forth on the Purchasers signature page hereto.
Representations and Warranties of the Company.
The Company hereby represents and warrants to the Purchaser as follows:
The Company is duly organized, validly existing and in good standing under the laws of the State of Nevada and is qualified to conduct its business as a foreign corporation in each jurisdiction where the failure to be so qualified would have a material adverse effect on the Company.
Authorization of Agreement, Etc.
The execution, delivery, and performance by the Company of its obligations under the Transaction Documents has been duly authorized by all requisite corporate action on the part of the Company; and this Agreement and the Transaction Documents have been duly executed and delivered by the Company. Each of the Transaction Documents, when executed and delivered by the Company, constitutes the valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium, or other similar laws affecting creditors rights and remedies generally, and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding at law or in equity).
Issuance of Shares.
The Shares are duly authorized and, when paid for and issued in accordance with the Transaction Documents, will be duly and validly issued, fully paid, and nonassessable, free and clear of all liens.
Representations and Warranties of the Purchaser.
The Purchaser hereby represents and warrants to the Company as follows:
Authorization of the Documents.
The Purchaser has all requisite power and authority (corporate or otherwise) to execute, deliver, and perform its obligations under the Transaction Documents, and the execution, delivery, and performance by the Purchaser of its obligations under the Transaction Documents has been duly authorized by all requisite action on the part of the Purchaser and each such Transaction Document, when executed and delivered by the Purchaser, shall constitute the valid and binding obligation of the Purchaser, enforceable against the Purchaser in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium or other similar laws affecting creditors rights and remedies generally, and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding at law or in equity).
All of the representations, warranties, and information of the Purchaser as set forth in the Purchasers Subscription Application are incorporated by reference herein, shall be deemed to be a part hereof, and shall be true and correct at the Closing with the same force and effect as if made by the Purchaser as of the date thereof.
Access to Company Information.
The Purchaser acknowledges that it has been afforded access and the opportunity to obtain all financial and other information concerning the Company that such Purchaser desires (including the opportunity to meet with the Companys executive officers, either in person or telephonically). The Purchaser has reviewed copies of all reports filed by the Company (the Filings) with the Securities and Exchange Commission (the Commission) under the Securities Exchange Act of 1934, as amended (the Exchange Act), up to and including the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2014 (the "2014 Annual Report") and Quarterly Reports on Form 10-Q for the quarter ended September 30, 2015 (the "2015 Quarterly Report"), all of which are available for review at www.sec.gov. The Purchaser further acknowledges that it is familiar with the contents of the Filings and that there is no further information about the Company that the Purchaser desires in determining whether to acquire the Shares in the Offering.
The Purchaser acknowledges that the Company has recently declared it is no longer is a development stage company however continues to operate with limited revenues and currently is not operating with positive cash-flow from operations, and there can be no assurances that the Company will ever develop its operations as currently contemplated. The Purchaser acknowledges that an investment in the Shares is extremely speculative and that there is a substantial risk that the investor may lose the Purchasers entire investment in the Shares. The Purchaser acknowledges and understands that as a result of being a former Shell Company, Rule 144 may not be available to the Purchaser and all other holders of the Common Stock to permit the resale of the Common Stock if the company fails to continue to report on a timely basis.
Brokers and Finders.
The Company may engage a placement agent in connection with the Offering in its sole discretion, the Company shall not be obligated to pay any commission, brokerage fee, or finders fee based on any alleged agreement or understanding between the Purchaser and a third person in respect of the transactions contemplated hereby. The Purchaser hereby agrees to indemnify the Company against any claim by any third person for any commission, brokerage fee, finders fee, or other payment with respect to this Agreement or the transactions contemplated hereby based on any alleged agreement or understanding between the Purchaser and any such third person, whether express or implied from the actions of the Purchaser or anyone acting or purporting to act on behalf of the Purchaser.
Indemnification by the Purchaser.
The Purchaser hereby agrees to indemnify and defend (with counsel acceptable to the Company) the Company and its officers, directors, employees, and agents and hold them harmless from and against any and all liability, loss, damage, cost, or expense, including costs and reasonable attorneys fees, incurred on account of or arising from:
any breach of or inaccuracy in any of the Purchasers representations, warranties, or agreements made herein, in any of the Transaction Documents, or in any document or instrument contemplated hereby or thereby; and
any action, suit, or proceeding based on a claim that the Purchasers representations, warranties or agreements made herein, in any of the Transaction Documents, or in any document or instrument contemplated hereby or thereby, were inaccurate or misleading, or otherwise cause for obtaining damages or redress from the Company or any current or former officer, director, employee, or agent of the Company under the Securities Act.
Successors and Assigns.
This Agreement shall bind and inure to the benefit of the Company, the Purchaser, and their respective successors and assigns.
This Agreement and the other writings and agreements referred to in this Agreement or delivered pursuant to this Agreement contain the entire understanding of the Parties with respect to the subject matter hereof and supersede all prior agreements and understandings, whether written or verbal, among the Parties with respect thereto.
All notices, demands and requests of any kind to be delivered to any Party in connection with this Agreement shall be in writing and shall be deemed to have been duly given if personally delivered or if sent by internationally-recognized overnight courier or by registered or certified mail, return receipt requested and postage prepaid, addressed as follows:
if to the Company, to:
8700 E Vista Bonita Dr., STE 260
Scottsdale, AZ 85255
Attention: William Clark, President and CEO
with a copy to:
800 Wilshire Boulevard, 12th Floor
Los Angeles, CA 90017
Attention: Peter Hogan
if to the Purchaser, to:
at the address of the Purchaser set forth on the Purchasers signature page hereto;
or to such other address as the Party to whom notice is to be given may have furnished to the other Parties to this Agreement in writing in accordance with the provisions of this Section. Any such notice or communication shall be deemed to have been received (i) in the case of personal delivery, on the date of such delivery, (ii) in the case of internationally-recognized overnight courier, on the next business day after the date when sent and (iii) in the case of mailing, on the third business day following that on which the piece of mail containing such communication is posted.
This Agreement may not be modified or amended, nor may any provision of this Agreement be waived, except as evidenced by a written agreement duly executed by the Company and holders of at least 51% of the Common Stock purchased by the Purchaser and all Other Purchasers combined, and any such agreement shall be binding on the Purchaser and all other Purchasers.
Governing Law; Waiver of Jury Trial.
All questions concerning the construction, interpretation, and validity of this Agreement shall be governed by and construed and enforced in accordance with the domestic laws of the State of Nevada without giving effect to any choice or conflict of law provision or rule (whether in the State of Nevada or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Nevada. In furtherance of the foregoing, the internal law of the State of Nevada will control the interpretation and construction of this Agreement, even if under such jurisdictions choice of law or conflict of law analysis, the substantive law of some other jurisdiction would ordinarily or necessarily apply.
Submission to Jurisdiction.
Any legal action or proceeding with respect to this Agreement may be brought in the courts of the State of Arizona and the United States of America located in the Phoenix, Arizona, and, by execution and delivery of this Agreement, the Company hereby accepts for itself and in respect of its property, generally and unconditionally, the jurisdiction of the aforesaid courts. The Purchaser hereby irrevocably waives, in connection with any such action or proceeding, any objection, including, without limitation, any objection to the venue or based on the grounds of forum non conveniens, which it may now or hereafter have to the bringing of any such action or proceeding in such respective jurisdictions. The Purchaser hereby irrevocably consents to the service of process of any of the aforementioned courts in any such action or proceeding by the mailing of copies thereof by registered or certified mail, postage prepaid, to it at its address as set forth herein.
It is the desire and intent of the Parties that the provisions of this Agreement be enforced to the fullest extent permissible under the law and public policies applied in each jurisdiction in which enforcement is sought. Accordingly, in the event that any provision of this Agreement would be held in any jurisdiction to be invalid, prohibited, or unenforceable for any reason, such provision, as to such jurisdiction, shall be ineffective, without invalidating the remaining provisions of this Agreement or affecting the validity or enforceability of such provision in any other jurisdiction. Notwithstanding the foregoing, if such provision could be more narrowly drawn so as not to be invalid, prohibited, or unenforceable in such jurisdiction, it shall, as to such jurisdiction, be so narrowly drawn, without invalidating the remaining provisions of this Agreement or affecting the validity or enforceability of such provision in any other jurisdiction.
Independence of Agreements, Covenants, Representations and Warranties.
All agreements and covenants hereunder shall be given independent effect so that if a certain action or condition constitutes a default under a certain agreement or covenant, the fact that such action or condition is permitted by another agreement or covenant shall not affect the occurrence of such default, unless expressly permitted under an exception to such covenant.
In addition, all representations and warranties hereunder shall be given independent effect so that if a particular representation or warranty proves to be incorrect or is breached, the fact that another representation or warranty concerning the same or similar subject matter is correct or is not breached will not affect the incorrectness of or a breach of a representation and warranty hereunder. The exhibits and any schedules annexed hereto are hereby made part of this Agreement in all respects.
This Agreement may be executed in any number of counterparts, and each such counterpart of this Agreement shall be deemed to be an original instrument, but all such counterparts together shall constitute but one agreement. Facsimile or PDF counterpart signatures to this Agreement shall be acceptable and binding.
The section and paragraph headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement.
Each Party shall pay its own fees and expenses incurred in connection with the negotiation, execution, delivery and performance of this Agreement, the Transaction Documents and any document or instrument contemplated hereby or thereby.
Preparation of Agreement.
The Company prepared this Agreement and the Transaction Documents solely on its behalf. Each Party to this Agreement acknowledges that: (i) the Party had the advice of, or sufficient opportunity to obtain the advice of, legal counsel separate and independent of legal counsel for any other Party hereto; (ii) the terms of the transactions contemplated by this Agreement are fair and reasonable to such Party; and (iii) such Party has voluntarily entered into the transactions contemplated by this Agreement without duress or coercion. Each Party further acknowledges that such Party was not represented by the legal counsel of any other Party hereto in connection with the transactions contemplated by this Agreement, nor was he or it under any belief or understanding that such legal counsel was representing his or its interests. Each Party agrees that no conflict, omission, or ambiguity in this Agreement, or the interpretation thereof, shall be presumed, implied, or otherwise construed against any other Party to this Agreement on the basis that such Party was responsible for drafting this Agreement.
Use of Proceeds.
The Company shall use the net proceeds from the Offering for general working capital and general corporate purposes and debt service obligations.
[Signature Pages Follow]
IN WITNESS WHEREOF, each of the undersigned has duly executed this Securities Purchase Agreement as of the later date set forth on the signature pages below.
Date: _______________, 2015
By: /s/ William Clark
Name: William Clark
Title: President and CEO
[Purchaser Signature Page Follows]
PURCHASER SIGNATURE PAGE TO SPINDLE, INC.
SECURITIES PURCHASE AGREEMENT
Name of Purchaser (Individual or
Name of Individual representing
Purchaser (if an Institution)
Signature of Individual Purchaser or
Title of Individual representing
Individual representing Purchaser
Purchaser (if an Institution)
Aggregate number of Shares
Aggregate Purchase Price