EXHIBIT 10.4

 

SUBSCRIPTION AGREEMENT

 

THIS SUBSCRIPTION AGREEMENT (this “Agreement”) is made and entered into as of
the date set forth on the signature page to this Agreement, between Talon
International, Inc., a Delaware corporation (the “Company”), and the investor
identified on the signature page to this Agreement (the “Investor”).

 

RECITALS

 

A.     Subject to the terms and conditions set forth in this Agreement and
pursuant to Section 4(2) of the Securities Act (as defined below), and Rule 506
promulgated thereunder, the Company proposes to issue and sell up to $5.5
million in shares of Common Stock, par value $.001 per share (the “Common
Stock”), of the Company at a purchase price of $0.09 per share (the “Offering
Price”), in each case pursuant to an offering (the “Offering”) to one or more
potential investors, including the Investor.

 

B.     The Company desires to sell to the Investor, and the Investor desires to
buy from the Company, in the Offering the number of shares of the Common Stock
(the “Shares”) set forth on the signature page of this Agreement, upon the terms
and conditions and subject to the provisions hereinafter set forth.

 

Agreement

 

NOW, THEREFORE, for and in consideration of the mutual premises contained herein
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto agree as follows:

 

1.     Purchase and Sale of Securities. Subject to the terms and conditions of
this Agreement, the Investor subscribes for and agrees to purchase and acquire
from the Company, and the Company agrees to sell and issue to the Investor, the
Shares in the manner set forth in Section 2 hereof, at the Offering Price and
for the aggregate consideration set forth on the signature page of this
Agreement (the “Purchase Price”).

 

2.     Terms of Purchase and Sale of Securities. The closing of the transactions
contemplated hereby (the “Closing”) shall take place at such time and on such
date as is determined by the Company as soon as practicable following
satisfaction of the closing conditions set forth in Section 7. On or before July
12, 2013, the Investor shall deliver the Purchase Price to Stubbs, Alderton &
Markiles LLP, legal counsel to the Company (the “Escrow Agent”), by wire
transfer of immediately available funds in accordance with the following wire
transfer instructions:

 

 

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Account Name:     
Address:          
ABA Routing#:     
SWIFT:          
Account #:          
Ref:               

 

The Purchase Price will be held by the Escrow Agent and released to the Company
at Closing against delivery to the Investor of stock certificates representing
the Shares pursuant to the terms and conditions of that certain Closing Escrow
Agreement by and among the Investor, the Company and the Escrow Agent in the
form attached hereto as Exhibit B (the “Escrow Agreement” and together with this
Agreement, the “Transaction Documents”).

 

3.     Representations and Warranties of the Company. In order to induce the
Investor to enter into this Agreement and consummate the transactions
contemplated hereby, the Company represents and warrants to the Investor as
follows:

 

3.1     Incorporation. The Company is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware and is
qualified to do business in each jurisdiction in which the character of its
properties or the nature of its business requires such qualification, except
where the failure to so qualify would not have a material adverse effect on the
business, condition (financial or otherwise) or prospects of the Company (a
“Material Adverse Effect”). Except for short-term investments and investments
that are not material to the Company, the Company does not own any shares of
stock or any other equity or long-term debt securities of any corporation or
have any equity interest in any firm, partnership, limited liability company,
joint venture, association or other entity, except as disclosed in the SEC
Documents (as defined below). Complete and correct copies of the certificate of
incorporation (the “Certificate of Incorporation”) and bylaws (the “Bylaws”) of
the Company as in effect on the Effective Date have been filed by the Company
with the SEC. The Company has all requisite corporate power and authority to
execute, deliver and perform its obligations under the Transaction Documents and
to carry on its business as now conducted.

 

3.2     Capitalization. The authorized capital stock of the Company consists of
(i) 100,000,000 shares of Common Stock, of which 24,900,808 shares are
outstanding on the date hereof; and (ii) 3,000,000 shares of preferred stock, of
which 250,000 shares have been designated “Series A Preferred Stock”, no shares
of which are outstanding on the date hereof, and 407,160 shares have been
designated “Series B Convertible Preferred Stock” (the “Series B Preferred
Stock”), all of which are outstanding on the date hereof. Each share of Series B
Preferred Stock is convertible into 100 shares of Common Stock. The outstanding
shares of capital stock of the Company have been duly and validly issued and are
fully paid and nonassessable, have been issued in compliance with all federal
and state securities laws, and were not issued in violation of any preemptive or
similar rights to subscribe for or purchase securities. Except for (i) options
and restricted stock units for shares of Common Stock or other equity awards
issued to directors, employees and consultants of the Company pursuant to the
employee benefits plans (the “Benefit Plans”) disclosed in the SEC Documents, of
which options to purchase 6,084,600 shares of Common Stock and 7,057,000
restricted stock units are outstanding, and (ii) the Series B Preferred Stock,
there are no existing options, warrants, calls, preemptive (or similar) rights,
subscriptions or other rights, agreements, arrangements or commitments of any
character obligating the Company to issue, transfer or sell, or cause to be
issued, transferred or sold, any shares of the capital stock of the Company or
other equity interests in the Company or any securities convertible into or
exchangeable for such shares of capital stock or other equity interests. Except
for the Securities Redemption Agreement (as defined below) proposed to be
entered into between the Company and CVC California, LLC, as described in
Section 6 below, there are no outstanding or contemplated contractual
obligations of the Company to repurchase, redeem or otherwise acquire any shares
of its capital stock or other equity interests. The issuance of the Shares
contemplated hereby, along with all other shares to be issued in the Offering,
will not result in an over-issuance of shares of Common Stock under the
Certificate of Incorporation, giving effect to the issuance of shares of Common
Stock reserved for issuance pursuant to the Benefit Plans.

 

 
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3.3     Valid Issuance of the Shares. The Shares being purchased by the Investor
hereunder will, upon issuance pursuant to the terms hereof, be duly authorized
and validly issued, fully paid and nonassessable. No preemptive rights or other
rights to subscribe for or purchase the Company’s capital stock exist with
respect to the issuance and sale of the Shares by the Company pursuant to this
Agreement. No further approval or authority of the stockholders or the Board of
Directors of the Company shall be required for the issuance and sale of the
Shares by the Company.

 

3.4     Enforceability. The execution, delivery, and performance of the
Transaction Documents by the Company have been duly authorized by all requisite
corporate action. This Agreement has been duly executed and delivered by the
Company, and, upon its execution by the Investor, shall constitute the legal,
valid, and binding obligation of the Company, enforceable in accordance with its
terms, except to the extent that its enforceability is limited by bankruptcy,
insolvency, reorganization, or other laws relating to or affecting the
enforcement of creditors’ rights generally and by general principles of equity.

 

3.5     No Violations. The execution, delivery, and performance of the
Transaction Documents and the Securities Redemption Agreement (as defined below)
by the Company, and the Series B Redemption (as defined below), do not and will
not violate or conflict with any provision of the Company’s Certificate of
Incorporation or Bylaws, each as amended and in effect on the date hereof, and
do not and will not, with or without the passage of time or the giving of
notice, result in the breach of, or constitute a default, cause the acceleration
of performance, or require any consent under (except such consents as have been
obtained as of the date hereof), or result in the creation of any lien, charge
or encumbrance upon any property or assets of the Company pursuant to, any law,
administrative regulation, ordinance or order of any court or governmental
agency, arbitration panel or authority applicable to the Company, or any
material instrument or agreement to which the Company is a party or by which the
Company or its properties are bound, except such consents as have been obtained
as of the date hereof. The Company is not otherwise in violation of its
Certificate of Incorporation, Bylaws or other organizational documents, nor is
the Company in violation, in any material respects, of any law, administrative
regulation, ordinance or order of any court or governmental agency, arbitration
panel or authority applicable to the Company. The Company is not in default (and
there exists no condition which, with the passage of time or otherwise, would
constitute a default) in the performance of any material bond, debenture, note
or any other evidence of indebtedness in any indenture, mortgage, deed of trust
or any other material agreement or instrument to which the Company is a party or
by which the Company is bound or by which the property of the Company is bound,
which would be reasonably expected to have a Material Adverse Effect.

 

 
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3.6     Approvals. Neither the execution, delivery, and performance by the
Company of the Transaction Documents and the Securities Redemption Agreement,
nor the offer and sale of the Shares contemplated hereby or by the Offering, nor
the Series B Redemption, require the consent of, action by or in respect of, or
filing with, any person, governmental body, agency, or official, other than
those consents that have been obtained and filings that have been made pursuant
to applicable state securities laws (“State Acts”) and post-sale filings
pursuant to applicable state and federal securities laws, which the Company
undertakes to file within the applicable time period, and other consents which
have been obtained as of the date hereof.

 

3.7     SEC Documents. The Company has made available to Investor true and
complete copies of all reports or registration statements the Company has filed
with the Securities Exchange Commission (“SEC”) under the Securities Act of 1933
(“Securities Act”) and the Securities Exchange Act of 1934 (the “Exchange Act”),
for all periods subsequent to December 31, 2011, all in the form so filed
(collectively the “SEC Documents”). The Company has filed in a timely manner all
documents that the Company was required to file under the Exchange Act during
the 12 months preceding the date of this Agreement. As of their respective
filing dates, the SEC Documents complied in all material respects with the
requirements of the Securities Act or the Exchange Act, as applicable, and none
of the SEC Documents filed under the Exchange Act contained any untrue statement
of a material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements made therein, in light of the
circumstances in which they were made, not misleading, except to the extent
corrected by a subsequently filed document with the SEC. None of the SEC
Documents filed under the Securities Act contained an untrue statement of
material fact or omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading at the time such SEC
Documents became effective under the Securities Act.

 

3.8     Financial Statements. The Company’s financial statements, including the
notes thereto, included in the SEC Documents (the “Financial Statements”) comply
as to form in all material respects with applicable accounting requirements and
with the published rules and regulations of the SEC with respect thereto, have
been prepared in accordance with United States generally accepted accounting
principles (“GAAP”) consistently applied (except as may be indicated in the
notes thereto) and present fairly the Company’s consolidated financial position
at the dates thereof and of its operations and cash flows for the periods then
ended (subject, in the case of unaudited statements, to normal audit adjustments
which were not or are not expected to be material). The Company has implemented
and maintains a system of internal controls meeting the requirements of the SEC
and the Sarbanes-Oxley Act of 2002 as applicable to the Company on the date
hereof. Since March 31, 2013, except as disclosed in the SEC Documents, there
has been no Material Adverse Effect and there has been no material adverse
change (actual or threatened) in the assets, liabilities (contingent or other),
affairs, operations, prospects or condition (financial or other) of the Company.

 

 
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3.9       Absence of Litigation. Except as disclosed in the SEC Documents, there
is no action, suit or proceeding or, to the Company’s knowledge, any
investigation, pending, or to the Company’s knowledge, threatened by or before
any court, governmental body or regulatory agency against the Company that is
required to be disclosed in the SEC Documents and is not so disclosed. The
Company has not received any written or oral notification of, or request for
information in connection with, any formal or informal inquiry, investigation or
proceeding from the SEC or the Financial Industry Regulatory Authority, Inc. The
foregoing includes, without limitation, any such action, suit, proceeding or
investigation that questions any of the Transaction Documents or the right of
the Company to execute, deliver and perform under same.

 

3.10     Taxes. The Company has filed all required federal, state and foreign
income and franchise tax returns and has paid or accrued all taxes shown as due
thereon, and the Company has no knowledge of a material tax deficiency which has
been or might be asserted or threatened against it.

 

3.11     Brokers or Finders. The Company has not dealt with any broker or finder
in connection with the transactions contemplated by this Agreement, and the
Company has not incurred, and shall not incur, directly or indirectly, any
liability for any brokerage or finders’ fees or agents’ commissions or any
similar charges in connection with this Agreement or any transaction
contemplated hereby.

 

3.12     Securities Laws. Assuming that all of the representations and
warranties of the Investor set forth in Section 4, and all of the
representations and warranties of the other Investors participating in the
Offering, are true and correct, the offer and sale of the Shares in the Offering
have been and will have been conducted and completed in compliance with the
Securities Act.

 

4.     Representations and Warranties of the Investor. In order to induce the
Company to enter into this Agreement and consummate the transaction contemplated
hereby, the Investor represents and warrants to the Company the following:

 

4.1     Authority. If a corporation, partnership, limited partnership, limited
liability company, or other form of entity, the Investor is duly organized or
formed, as the case may be, validly existing, and in good standing under the
laws of its jurisdiction of organization or formation, as the case may be. The
Investor has all requisite individual or entity right, power, and authority to
execute, deliver, and perform the Transaction Documents to which it is a party.

 

4.2     Enforceability. To the extent Investor is an entity, the execution,
delivery, and performance by the Investor of the Transaction Documents to which
it is a party have been duly authorized by all requisite entity action, as the
case may be. This Agreement has been duly executed and delivered by the
Investor, and, upon its execution by the Company, shall constitute the legal,
valid, and binding obligation of the Investor, enforceable against Investor in
accordance with its terms, except to the extent that its enforceability is
limited by bankruptcy, insolvency, reorganization, moratorium, or other laws
relating to or affecting the enforcement of creditors’ rights generally and by
general principles of equity.

 

 
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4.3     No Violations. The execution, delivery, and performance by the Investor
of the Transaction Documents to which it is a party do not and will not, with or
without the passage of time or the giving of notice, result in the breach of, or
constitute a default, cause the acceleration of performance, or require any
consent under, or result in the creation of any lien, charge or encumbrance upon
any property or assets of the Investor pursuant to, any material instrument or
agreement to which the Investor is a party or by which the Investor or its
properties may be bound or affected, and, if Investor is an entity, do not or
will not violate or conflict with any provision of the articles of incorporation
or bylaws, partnership agreement, operating agreement, trust agreement, or
similar organizational or governing document of the Investor, as applicable.

 

4.4     Knowledge of Investment and its Risks. The Investor has knowledge and
experience in financial and business matters as to be capable of evaluating the
merits and risks of Investor’s investment in the Shares. The Investor
understands that an investment in the Company represents a high degree of risk
and there is no assurance that the Company’s business or operations will be
successful. The Investor has considered carefully the risks attendant to an
investment in the Company, and that, as a consequence of such risks, the
Investor could lose Investor’s entire investment in the Company.

 

4.5     Investment Intent. The Investor hereby represents and warrants that (i)
the Shares are being acquired for investment for the Investor’s own account, and
not as a nominee or agent and not with a view to the resale or distribution of
all or any part of the Shares, and the Investor has no present intention of
selling, granting any participation in, or otherwise distributing any of the
Shares within the meaning of and in violation of the Securities Act, and (ii)
the Investor does not have any contracts, understandings, agreements, or
arrangements, directly or indirectly, with any person and/or entity to
distribute, sell, transfer, or grant participations to such person and/or entity
with respect to, any of the Shares. The Investor is not purchasing the Shares as
a result of any advertisement, article, notice or other communication regarding
the Shares published in any newspaper, magazine or similar media or broadcast
over television or radio or presented at any seminar or any other general
solicitation or general advertisement.

 

4.6     Investor Status. The Investor is an “accredited investor” as that term
is defined by Rule 501 of Regulation D promulgated under the Securities Act.

 

4.7     No Registration. The Investor understands that Investor may be required
to bear the economic risk of Investor’s investment in the Company for an
indefinite period of time. The Investor further understands that (i) neither the
offering nor the sale of the Shares has been registered under the Securities Act
or any applicable State Acts in reliance upon exemptions from the registration
requirements of such laws, (ii) the Shares must be held by he, she or it
indefinitely unless the sale or transfer thereof is subsequently registered
under the Securities Act and any applicable State Acts, or an exemption from
such registration requirements is available, and (iii) the Company will rely
upon the representations and warranties made by the Investor in this Agreement
in order to establish such exemptions from the registration requirements of the
Securities Act and any applicable State Acts.

 

 
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4.8     Transfer Restrictions. The Investor will not transfer any of the Shares
unless such transfer is registered or exempt from registration under the
Securities Act and such State Acts, and, if requested by the Company in the case
of an exempt transaction, the Investor has furnished an opinion of counsel
reasonably satisfactory to the Company that such transfer is so exempt. The
Investor understands and agrees that (i) the certificates evidencing the Shares
will bear appropriate legends indicating such transfer restrictions placed upon
the Shares, (ii) the Company shall have no obligation to honor transfers of any
of Shares in violation of such transfer restrictions, and (iii) the Company
shall be entitled to instruct any transfer agent or agents for the securities of
the Company to refuse to honor such transfers.

 

4.9     Principal Address. The Investor’s principal residence, if an individual,
or principal executive office, if an entity, is set forth on the signature page
of this Agreement.

 

4.10     Foreign Investors.  If the Investor is not a United States person (as
defined by Section 7701(a)(30) of the Internal Revenue Code), the Investor
hereby represents that it has satisfied itself as to the full observance of the
laws of its jurisdiction in connection with any invitation to subscribe for the
Shares or any use of this Agreement, including (i) the legal requirements within
its jurisdiction for the purchase of the Shares, (ii) any foreign exchange
restrictions applicable to such purchase, (iii) any governmental or other
consents that may need to be obtained, and (iv) the income tax and other tax
consequences, if any, that may be relevant to the purchase, holding, redemption,
sale, or transfer of the Shares.  The Investor’s subscription and payment for
and continued beneficial ownership of the Shares will not violate any applicable
securities or other laws of the Investor’s jurisdiction.

 

5.     Independent Nature of Investor’s Obligations and Rights. The obligations
of the Investor under the Transaction Documents to which it is a party are
several and not joint with the obligations of any other purchaser of Shares, and
the Investor shall not be responsible in any way for the performance of the
obligations of any other purchaser of Shares under any Transaction Document or
otherwise. The decision of the Investor to purchase Shares pursuant to the
Transaction Documents has been made by the Investor independently of any other
purchaser of Shares. Nothing contained herein or in any other Transaction
Document, and no action taken by any purchaser of Shares pursuant thereto, shall
be deemed to constitute such purchasers as a partnership, an association, a
joint venture, or any other kind of entity, or create a presumption that the
purchasers of Shares are in any way acting in concert or as a group with respect
to such obligations or the transactions contemplated by the Transaction
Document. The Investor acknowledges that no other purchaser of Shares has acted
as agent for the Investor in connection with making its investment hereunder and
that no other purchaser of Shares will be acting as agent of the Investor in
connection with monitoring its investment in the Shares or enforcing its rights
under the Transaction Documents. The Investor shall be entitled to independently
protect and enforce its rights, including without limitation the rights arising
out of this Agreement or out of the other Transaction Documents, and it shall
not be necessary for any other purchaser of Shares to be joined as an additional
party in any proceeding for such purpose.

 

 
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6.     Securities Redemption Agreement. The Company proposes to purchase and
redeem from CVC California, LLC (“CVC”), 407,160 shares (the “Series B Shares”)
of Series B Preferred Stock for an aggregate purchase price of $18,800,000
pursuant to a securities redemption agreement to be entered into between the
Company and CVC, substantially in the form attached hereto as Exhibit A (the
“Securities Redemption Agreement”). Such redemption is referred to herein as the
“Series B Redemption.” Additionally, the Company proposes to refinance the Note
(as defined in the Securities Redemption Agreement) on or before its six-month
maturity date.

 

7.     Conditions Precedent.

 

7.1     Conditions to the Obligation of the Investor to Consummate the Closing.
The obligation of the Investor to consummate the Closing and to purchase and pay
for the Shares being purchased by it pursuant to this Agreement is subject to
the satisfaction of the following conditions precedent:

 

(a)     The representations and warranties of the Company contained herein shall
be true and correct on the date of the Closing with the same force and effect as
though made on the date of the Closing.

 

(b)     The Company shall have entered into the Securities Redemption Agreement
and the Series B Redemption shall be scheduled to close contemporaneously with
(or immediately following) the Closing.

 

(c)     The Escrow Agreement shall have been executed and delivered by the
Company and the Escrow Agent.

 

(d)     The Company shall have executed and delivered to the Investor the
Registration Rights Agreement in substantially the form attached hereto as
Exhibit C.

 

(e)     The Company shall have received and accepted Subscription Agreements and
funds for not less than 61,111,108 Shares and $5,500,000 in the Offering.

 

(f)     The Company shall have performed all obligations and conditions required
to be performed or observed by the Company under this Agreement and the other
Transaction Documents on or prior to the Closing.

 

Notwithstanding anything contained herein to the contrary, if, for any reason,
the Company and CVC have not entered into the Securities Redemption Agreement on
or before July 31, 2013 (the “Redemption Closing Deadline”), then: (1) the
Escrow Agent or the Company (as applicable) shall promptly return to the
Investor the aggregate Purchase Price originally deposited by the Investor into
escrow in accordance with Section 2 hereof; (2) the Escrow Agent or the Investor
(as applicable) shall promptly return to the Company the certificates
representing the Shares originally deposited by the Company into escrow; and (3)
both the Company and the Investor shall thereafter be released from any and all
obligations hereunder (including but not limited to the Investor’s obligation to
purchase, and the Company’s obligation to sell, the Shares as contemplated
herein).

 

 
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7.2     Conditions to the Obligation of the Company to Consummate the Closing.
The obligation of the Company to consummate the Closing and to issue and sell to
the Investor the Shares to be purchased by it at the Closing is subject to the
satisfaction of the following conditions precedent:

 

(a)     The representations and warranties of the Investor contained herein
shall be true and correct on the date of the Closing with the same force and
effect as though made on the date of the Closing.

 

(b)     The Escrow Agreement shall have been executed and delivered by the
Investor and the Escrow Agent.

 

(c)     The Company and CVC shall have executed and delivered the Securities
Redemption Agreement.

 

(d)     The Investor shall have performed all obligations and conditions
required to be performed or observed by the Investor under this Agreement and
the other Transaction Documents on or prior to the Closing.

 

8.     Expenses. Each party will pay its own legal, accounting and other
expenses incurred by such party or on its behalf in connection with this
Agreement and the transactions contemplated herein; provided, that the Company
shall pay or reimburse the legal fees and expenses incurred by Paul Hastings
LLP, counsel to the Investor and other investors in the Offering incurred in
connection with the legal review and negotiation of this Agreement, up to an
aggregate maximum of $50,000.

 

9.     Waiver of Conflicts. Each party to this Agreement acknowledges that
Stubbs Alderton & Markiles, LLP (“SAM”), counsel for the Company, may have in
the past performed and may continue to perform legal services for the Investor
or its affiliates in matters unrelated to the transactions described in this
Agreement, including the representation of the Investor or its affiliates in
matters of a similar nature to the transactions contemplated by this Agreement.
The applicable rules of professional conduct require that SAM inform the parties
hereunder of this representation and obtain their consent.  SAM has served as
outside general counsel to the Company and has negotiated the terms of this
Agreement and the transactions contemplated hereby solely on behalf of the
Company. Accordingly, each party to this Agreement hereby (a) acknowledges that
they have had an opportunity to ask for information relevant to this disclosure;
(b) acknowledge that with respect to this Agreement and the transaction
contemplated hereby, SAM has represented solely the Company, and not the
Investor or any stockholder, director or employee of the Company or any
Investor; and (c) gives its informed consent to SAM’s representation of the
Investor (if applicable) in such unrelated matters and to SAM’s representation
of the Company in connection with this Agreement and the transactions
contemplated hereby.

 

10.     Further Assurances. The parties hereto will, upon reasonable request,
execute and deliver all such further assignments, endorsements and other
documents as may be necessary in order to perfect the purchase by the Investor
of the Shares.

 

 
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11.     Investigations; Survival of Warranties. The respective representations
and warranties and covenants of Investor and the Company contained herein are
true, accurate and correct and shall not be deemed waived or otherwise affected
by any investigation made by any party hereto or by the occurrence of the
Closing. Each and every such representation and warranty shall survive the date
of the Closing.

 

12.     Entire Agreement; No Oral Modification. This Agreement contains the
entire agreement among the parties hereto with respect to the subject matter
hereof and supersedes all prior agreements and understandings with respect
thereto and may not be amended or modified except in a writing signed by both of
the parties hereto.

 

13.     Binding Effect; Benefits. This Agreement shall inure to the benefit of
and be binding upon the parties hereto and their respective heirs, successors
and assigns; however, nothing in this Agreement, expressed or implied, is
intended to confer on any other person other than the parties hereto, or their
respective heirs, successors or assigns, any rights, remedies, obligations or
liabilities under or by reason of this Agreement.

 

14.     Counterparts. This Agreement may be executed in any number of
counterparts, including by electronic signature, each of which shall be deemed
to be an original and all of which together shall be deemed to be one and the
same instrument.

 

15.     Governing Law. This Agreement shall be governed by, and construed and
enforced in accordance with, the laws of the United States of America and the
State of California, both substantive and remedial, except to the extent of the
application of the Delaware General Corporations Law.

 

16.     Prevailing Parties. In any action or proceeding brought to enforce any
provision of this Agreement, or where any provision hereof is validly asserted
as a defense, the prevailing party shall be entitled to receive and the
nonprevailing party shall pay upon demand reasonable attorneys’ fees in addition
to any other remedy.

 

17.     Notices. All communication hereunder shall be in writing and, if sent to
Investor shall be mailed, delivered, telegraphed or sent by facsimile or
electronic mail, and confirmed to an Investor at the address set forth on the
signature page of this Agreement, or if sent to the Company, shall be mailed,
delivered, telegraphed or sent by facsimile or electronic mail and confirmed to
the Company at Talon International, Inc., 21900 Burbank Blvd., Ste. 270,
Woodland Hills, California 91367, Attention: Chief Executive Officer, facsimile
number (818) 444-4110.

 

18.     Headings. The section headings herein are included for convenience only
and are not to be deemed a part of this Agreement.

 

 
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
12th day of July, 2013.

 

 

 

COMPANY:

TALON INTERNATIONAL, INC.,
a Delaware corporation

                     By:       Name: Lonnie D. Schnell     Title:  Chief
Executive Officer  

 

 

INVESTOR:

  Print Name of Investor                    By:       Name:       Title:     
(Address)  IRS Tax Identification No. (if applicable)
Telephone Number
Fax Number
E-Mail Address

 

 

 

X

$0.09

=

Number of Shares

Offering Price

 

Purchase Price

 

 

 

 S-1