SECURITIES PURCHASE AGREEMENT

 

THIS SECURITIES PURCHASE AGREEMENT (this “Agreement”), is made effective as of
MAY 15, 2013 (the “Effective Date”), by and among [                  ] (“Buyer”)
and PREMIER BEVERAGE GROUP, CORP. (“Company”). Capitalized terms used herein and
not otherwise defined herein shall have the respective meanings set forth in
that certain Security Agreement entered into on even date herewith by and
between Company and Buyer.

 

WITNESSETH

 

WHEREAS, the Company and the Buyer are executing and delivering this Agreement
in reliance upon an exemption from securities registration pursuant to Section
4(2), 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, Buyer holds that certain senior secured convertible debenture numbered
PBGC – 59FF 101 issued by the Company, with an outstanding balance of
$225,000.00 (“Amended Debenture”);

 

WHEREAS, the parties desire that, upon the terms and subject to the conditions
contained herein, the Company shall issue and sell to the Buyer, as provided
herein, and the Buyer shall purchase the Securities, which shall be convertible
into shares of the Company’s common stock, par value $0.00015 (the “Common
Stock” and, as converted, the “Conversion Shares”), in exchange for certain
consideration payable on the terms set forth herein (the “Purchase Price” and
the “Subscription Amount”); and

 

WHEREAS, contemporaneously with the execution and delivery of this Agreement,
the parties hereto are executing and delivering certain other agreements and
instruments, all of which constitute part of this transaction (collectively, the
“Transaction Documents”).

 

NOW, THEREFORE, in consideration of the mutual covenants and other agreements
contained in this Agreement the Company and the Buyer hereby agree as follows:

 

1.          PURCHASE AND SALE OF SECURITIES

 

(a)          The Securities. Subject to the terms and conditions set forth in
this Agreement, the Buyer shall purchase from the Company and the Company shall
issue to the Buyer a secured convertible debenture in substantially the same
form as the form of debenture attached hereto as Exhibit A (the “Securities” or
the “New Debenture”), which shall be convertible into shares of common stock of
the Company (the “Common Stock”).

 

(b)          The Purchase Price. Buyer shall purchase the New Debenture in
exchange for $150,000 in cash paid to the Company in three tranches, with the
first tranche of $30,000 paid in the form of immediately available U.S. cash
funds at the Closing, the second tranche of $60,000 paid on or before June 20,
2013, and the third tranche of $60,000 paid on or before July 20, 2013
(collectively, the “Purchase Price”).

 

(c)          The Closing. The Closing of the purchase and sale of the Securities
shall take place at 10:00 a.m. Eastern Standard Time on the second (2nd)
business day following the date hereof, 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) (the
“Closing Date”).

 

2.          BUYER’S REPRESENTATIONS AND WARRANTIES

 

Buyer represents and warrants that:

 

(a)          Investment Purpose. Buyer is acquiring the Securities and, upon
conversion of Securities, 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. Buyer is an “Accredited Investor” as
that term is defined in Rule 501(a)(3) of Regulation D.

 

(c)          Information. 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 Securities and the
Conversion Shares, which have been requested by Buyer. 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 Buyer or its advisors, if any, or its
representatives shall modify, amend or affect Buyer’s right to rely on the
Company’s representations and warranties contained in Section 3 below. Buyer
understands that its investment in the Securities and the Conversion Shares
involves a high degree of risk. Buyer is in a position regarding the Company,
which, based upon employment, family relationship or economic bargaining power,
enabled and enables Buyer to obtain information from the Company in order to
evaluate the merits and risks of this investment. 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 Securities
and the Conversion Shares.

 

(d)          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 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.

 

(e)          Due Formation of Corporate and Other Buyer. Buyer has been formed
and validly exists and has not been organized for the specific purpose of
purchasing the Securities and is not prohibited from doing so.

 

3.          REPRESENTATIONS AND WARRANTIES OF THE COMPANY

 

The Company represents and warrants to the Buyer that, except as set forth in
the SEC Documents (as defined herein):

 

(a)          Organization and Qualification. The Company and its Active
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 Active 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 Active 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 and the other Transaction Documents and to issue the
Securities 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 Securities 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.

 

(c)          Capitalization. The authorized capital stock of the Company
consists of ________________ shares of Common Stock, par value $0.00015 per
share, of which about ________________ shares of Common Stock are issued and
outstanding as of the date hereof. 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 either to 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 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 or an S-8 Registration Statement) and (iii) there
are no outstanding registration statements (except for an S-8 Registration
Statement 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 Securities 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 Securities 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
Securities have been duly authorized and reserved for issuance. Upon conversion
or exercise in accordance with the Securities 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. The Company shall file 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 Buyer or their representatives, or made available through the SEC’s website
at http://www.sec.gov, 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 Securities. The
Company acknowledges and agrees that the Buyer 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 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 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
Securities 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 Securities 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
Securities or the Conversion Shares under the Securities Act or cause this
offering of the Securities or the Conversion Shares to be integrated with prior
offerings by the Company for purposes of the Securities Act.

 

(l)          Internal Accounting Controls. Except as set forth in the SEC
Documents, 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.

 

(m)          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.

 

(n)          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.

 

 

 

 

(o)          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.

 

(p)          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 timely to
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 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 Buyer 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 Buyer on or prior to the
Closing Date.

 

(c)          Reporting Status. Until the earlier of (i) the date as of which the
Buyer 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 shall have sold all the Conversion Shares and (B)
none of the Securities 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)          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 all of the Conversion Shares due to Buyer upon conversion of the
Amended Debenture. A default event under this Agreement and the Amended
Debenture shall occur if the Company does not have available such number of
shares of Common Stock as shall be necessary to effect the issuance of all of
the Conversion Shares due to Buyer upon conversion of the Amended Debenture for
a period of greater than 45 consecutive days.

 

(e)          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 Marketplace (“OTCQB”) 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 OTCQB.

 

(f)          Fees and Expenses. Each of the Company and the Buyer shall pay all
costs and expenses incurred by such party in connection with the negotiation,
investigation, preparation, execution and delivery of the Transaction Documents.

 

 

 

 

(g)          Corporate Existence. So long as any of the Securities 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 Securities.

 

(h)          Transactions With Affiliates. So long as any Securities 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.

 

(i)          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 Transfer Agent Instructions (as defined herein).

 

(j)          Production Financing; Additional Indebtedness. The Company shall
have closed on an additional $_____________ in debt financing from
_________________ (“Production Lender”) on or before ____ ____, 2013 to provide
working capital for inventory and production costs (“Production Financing”).
With the exception of the Production Financing, the Company shall not issue any
debt securities or promissory notes in the absence of the Buyer’s prior written
consent, which consent shall not be unreasonably withheld.

 

(k)          Current Filings. The Company shall file all reports required under
Section 13 of the Securities Exchange Act of 1934 within the time parameters
mandated by the Rules of the Securities and Exchange Commission.

 

(l)          Management. The Company shall have executed and shall remain at all
times in compliance with that certain ______________ (“Management Agreement”)
with Core Equity Group, LLC (“CEG”).

 

(m)          Further Assurances; Cooperation. The Company shall use its best
efforts to cooperate with the Company and to diligently perform under the
Transaction Documents. At and after the Closing, the Company shall execute and
deliver such further instruments of conveyance and transfer as Buyer may
reasonably request to convey and transfer effectively to Buyer the Securities
and any and all amounts and shares of Common Stock due and payable thereunder.

 

5.          TRANSFER AGENT INSTRUCTIONS

 

(a)          The Company shall issue the Transfer Agent Instructions to its
transfer agent in the form attached hereto as Exhibit B for the purpose of
having certificates issued, registered in the name of the Buyer or its
respective nominee(s), for the Conversion Shares representing such amounts of
Securities as specified from time to time by the Buyer to the Company upon
conversion of the Securities, for interest owed pursuant to the Securities, and
for any and all Liquidated Damages (as this term is defined in the Investor
Registration Rights Agreement).

 

(b)          The Company shall not change its transfer agent without the express
written consent of the Buyer, which may be withheld by the Buyer in its sole
discretion.

 

 

 

 

(c)          The Company warrants that no instruction other than the Transfer
Agent Instructions referred to in this Section 5 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.

 

(d)          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 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
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.

 

(e)          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 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 Securities to the
Buyer 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) Buyer shall have executed the Transaction Documents and
delivered them to the Company; and (b), Buyer shall have delivered to the
Company the Purchase Price.

 

7.          CONDITIONS TO THE BUYER’S OBLIGATION TO PURCHASE

 

The obligation of the Buyer hereunder to purchase the Securities and to pay the
Purchase Price pursuant to Section 1(b) hereof is subject to the satisfaction,
at or before the Closing Date or any Purchase Price payment date, of each of the
following conditions:

 

(a)          The Company shall have executed the Transaction Documents and
delivered them to the Buyer.

 

(b)          The representations and warranties of the Company 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). The Company shall have performed, satisfied and
complied in all material respects with the covenants, agreement and conditions
required by this Agreement and the Amended Debenture to be performed, satisfied
or complied with by the Company at or prior to the Closing Date or any Purchase
Price payment date, and through and including the date upon which the Amended
Debenture has been fully paid. If requested by the Buyer, the Buyer shall have
received a certificate, executed by the President of the Company to the
foregoing effect and as to such other matters as may be reasonably requested by
the Buyer.

 

(c)          The Company shall have executed and delivered to the Buyer the
Securities, including the Amended Debenture.

 

(d)          The Company shall have provided to the Buyer a certificate of good
standing from the secretary of state from the state in which the company is
incorporated.

 

(e)          The 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 Securities 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 and each
other holder of the Securities 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 other Transaction Documents 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, the other Transaction
Documents 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 Indemnities, any transaction
financed or to be financed in whole or in part, directly or indirectly, with the
proceeds of the issuance of the Securities or the status of the Buyer or holder
of the Securities the Conversion Shares, as a Buyer of Securities 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.

 

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 Company and the Buyer expressly consent to
the jurisdiction and venue of the Superior Court of New Jersey, Bergen County,
for any litigation between the parties.

 

(b)          Specific Performance. The parties hereto recognize that any breach
of the terms this Agreement may give rise to irreparable harm for which money
damages would not be an adequate remedy, and accordingly agree that any
non-breaching party shall be entitled to enforce the terms of this Agreement by
a decree of specific performance without the necessity of proving the inadequacy
as a remedy of money damages. If specific performance is elected as a remedy
hereunder, such remedy shall be in addition to any other remedies available at
law or equity.

 

(c)          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.

 

(d)          Headings; Severability. The headings of this Agreement are for
convenience of reference and shall not form part of, or affect the
interpretation of, this Agreement. 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, 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. 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)          Publicity. The Company shall issue no press release or public
disclosure involving the Transaction Documents and/or the Financing in the
absence of the Buyer’s prior written consent.

 

(j)          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.

 

(k)          Termination. In the event that the Closing shall not have occurred
with respect to the Buyer 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, the Company shall remain obligated to reimburse the Buyer for
$5,000 in fees and expenses.

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK

- SIGNATURE PAGE FOLLOWS]

 

 

 

 

IN WITNESS WHEREOF the parties have duly executed, or caused their duly
authorized representative, to execute this Securities Purchase Agreement.

 

  [                                                   ]       By:   Name:  
Title:           Manager

 

PREMIER BEVERAGE GROUP, CORP.       By:     Name: Fouad Kallamni   Title:
President