SUBSCRIPTION AGREEMENT

 

THIS SUBSCRIPTION AGREEMENT (this “Agreement”), dated as of December 21, 2011,
by and between Wizard World, Inc., a Delaware corporation with its headquarters
located at 1350 Avenue of the Americas, New York, New York 10019 (the
“Company”), and the subscriber identified on the signature page hereto (the
“Subscriber”).

 

WHEREAS, the Company and Subscriber are executing and delivering this Agreement
in reliance upon an exemption from securities registration afforded by the
provisions of Section 4(2) and/or Regulation D (“Regulation D”) promulgated by
the United States Securities and Exchange Commission (the “Commission”) under
the Securities Act of 1933, as amended (the “Securities Act”); and

 

WHEREAS, the parties hereto desire that, upon the terms and subject to the
conditions contained herein, the Company shall issue and sell to Subscriber, and
Subscriber shall purchase, in the aggregate, that number of shares of common
stock, par value $.0001 per share, of the Company (the “Common Stock”) as is set
forth on the signature page hereto (the “Shares”) at an aggregate purchase price
(the “Purchase Price”) equal to the amount set forth on the signature page
hereto.

 

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

 

1. Purchase and Sale. Upon the terms and subject to the conditions set forth in
this Agreement, the Company hereby agrees to sell, assign, transfer and deliver
to Subscriber, and Subscriber hereby agrees to purchase and accept delivery from
the Company, the Shares free of all liens, pledges, mortgages, security
interests, charges, restrictions, adverse claims or other encumbrances of any
kind or nature whatsoever (“Encumbrances”), for the consideration specified
herein (such consideration, on a per share basis, the “Share Price”).

 

2. Subscriber Representations and Warranties. Subscriber hereby represents and
warrants to and agrees with the Company that:

 

(a) Standing of Subscriber. If Subscriber is an entity, such Subscriber is duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its formation. If Subscriber is a natural person, such
Subscriber is not a minor and has the legal capacity to enter into this
Agreement;

 

(b) Authorization and Power. Subscriber has the requisite power and authority to
enter into and perform this Agreement and to purchase the Shares being sold to
Subscriber hereunder. The execution, delivery and performance of this Agreement
by Subscriber and, if Subscriber is an entity, the consummation by Subscriber of
the transactions contemplated hereby have been duly authorized by all necessary
company action, and no further consent or authorization of Subscriber, its board
of directors or similar governing body, or stockholders is required, as
applicable. This Agreement has been duly authorized, executed and delivered by
Subscriber and constitutes, or shall constitute when executed and delivered, a
valid and binding obligation of Subscriber, enforceable against Subscriber in
accordance with the terms thereof;

 

(c) No Conflicts. If Subscriber is an entity, the execution, delivery and
performance of this Agreement and the consummation by Subscriber of the
transactions contemplated hereby do not and will not result in a violation of
Subscriber’s charter documents, bylaws or other organizational documents, as
applicable;

 

 

 

 

(d) Information on Subscriber. Such Subscriber is an “accredited investor,” as
such term is defined in Rule 501(a) of Regulation D promulgated by the
Commission under the Securities Act and affirmed by Subscriber in the completed
Purchaser Questionnaire attached hereto as Exhibit A, is experienced in
investments and business matters, has made investments of a speculative nature
and has purchased securities of United States publicly-owned companies in
private placements in the past and, with its representatives, has such knowledge
and experience in financial, tax and other business matters as to enable
Subscriber to utilize the information made available by the Company to evaluate
the merits and risks of and to make an informed investment decision with respect
to the proposed purchase, which represents a speculative investment. Subscriber
is able to bear the risk of such investment for an indefinite period and to
afford a complete loss thereof. Subscriber is not required to be registered as a
broker-dealer under Section 15 of the Securities Exchange Act of 1934, as
amended;

 

(e) Purchase of Shares. Subscriber will purchase the Shares for its own account
for investment and not with a view toward, or for resale in connection with, the
public sale or any distribution thereof in violation of the Securities Act or
any applicable state securities law, and has no direct or indirect arrangement
or understandings with any other person or entity to distribute or regarding the
distribution of such Shares;

 

(f) Compliance with Securities Act. Subscriber understands and agrees that the
Shares are “restricted securities” and have not been registered under the
Securities Act or any applicable state securities laws by reason of their
issuance in a transaction that does not require registration under the
Securities Act, and that such Shares must be held indefinitely unless a
subsequent disposition is registered under the Securities Act or any applicable
state securities laws or is exempt from such registration;

 

(g) Legend. The Shares shall bear the following or similar legend:

 

“THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAS NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, NOR APPLICABLE
STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD,
TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION
STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR
(B) AN OPINION OF COUNSEL (REASONABLY ACCEPTABLE TO THE COMPANY), IN AN
ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS
SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID ACT.”

 

(h) Communication of Offer. Subscriber has a preexisting personal or business
relationship with the Company or one or more of its directors, officers or
control persons, and the offer to sell the Shares was directly communicated to
Subscriber by the Company. At no time was Subscriber presented with or solicited
by any leaflet, newspaper or magazine article, radio or television
advertisement, or any other form of general advertising or solicited or invited
to attend a promotional meeting otherwise than in connection and concurrently
with such communicated offer;

 

(i) No Governmental Endorsement. Subscriber understands that no United States
federal or state agency or any other governmental or state agency has passed on
or made recommendations or endorsement of the Shares or the suitability of the
investment in the Shares, nor have such authorities passed upon or endorsed the
merits of the offering of the Shares;

 

 

 

 

(j) Receipt of Information. Subscriber believes it has received all the
information it considers necessary or appropriate for deciding whether to
purchase the Shares. Subscriber further represents that through its
representatives it has had an opportunity to ask questions and receive answers
from the Company regarding the terms and conditions of the offering of the
Shares and the business, properties and financial condition of the Company and
to obtain additional information (to the extent the Company possessed such
information or could acquire it without unreasonable effort or expense)
necessary to verify the accuracy of any information furnished to it or to which
it had access; and

 

(k) No Market Manipulation. Subscriber and Subscriber’s affiliates have not
taken, and will not take, directly or indirectly, any action designed to, or
that might reasonably be expected to, cause or result in stabilization or
manipulation of the price of the Common Stock, to facilitate the sale or resale
of the Shares or affect the price at which the Shares may be issued or resold.

 

3. Company Representations and Warranties. The Company represents and warrants
to, and agrees with, Subscriber that:

 

(a) Due Incorporation. The Company is a corporation duly incorporated, validly
existing and in good standing under the laws of the jurisdiction of its
incorporation;

 

(b) Authority; Enforceability. This Agreement has been duly authorized, executed
and delivered by the Company and is the valid and binding agreement of the
Company, enforceable in accordance with their terms, except as may be limited by
bankruptcy, insolvency, moratorium or other similar laws affecting the
enforcement of creditors’ rights generally, or principles of equity. The Company
has full corporate power and authority necessary to enter into and deliver this
Agreement and to perform its obligations thereunder;

 

(c) Consents. No consent, approval, authorization or order of any court,
governmental agency or body having jurisdiction over the Company or of any other
person is required for the execution by the Company of this Agreement and
compliance and performance by the Company of its obligations hereunder,
including, without limitation, the issuance and sale of the Shares;

 

(d) No Violation or Conflict. Neither the issuance nor the sale of the Shares
nor the performance of the Company’s obligations under this Agreement will:

 

(i) violate, conflict with, result in a breach of, or constitute a default (or
an event which with the giving of notice or the lapse of time or both would be
reasonably likely to constitute a default) under (a) the charter or bylaws of
the Company or (b) any decree, judgment, order or determination applicable to
the Company of any court, governmental agency or body having jurisdiction over
the Company or over the properties or assets of the Company or (c) any contract,
agreement, instrument or undertaking to which the Company or any subsidiary is a
party; or

 

(ii) result in the creation or imposition of any lien, charge or encumbrance
upon the Shares except in favor of Subscriber as described herein;

 

 

 

 

(e) The Shares. Upon issuance, the Shares:

 

(i) shall be free and clear of any security interests, liens, claims or other
Encumbrances, subject only to restrictions upon transfer under the Securities
Act and any applicable state securities laws;

 

(ii) shall have been duly and validly issued, fully paid and non-assessable; and

 

(iii) will not subject the holders thereof to personal liability by reason of
being such holders;

 

(f) No General Solicitation. Neither the Company, nor any of its affiliates, nor
any person or entity 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 Shares;

 

(g) Investment Company. The Company is not an “investment company” within the
meaning of the Investment Company Act of 1940, as amended; and

 

(h) Full Disclosure. No representation or warranty or other statement made by
the Company in this Agreement in connection with the contemplated transactions
contains any untrue statement of material fact or omits to state a material fact
necessary to make the representations and warranties set forth herein, in light
of the circumstances in which they were made, not misleading.

 

4. Broker’s Commission/Finder’s Fee. Each party hereto represents to the other
that there are no parties entitled to receive fees, commissions, finder’s fees,
due diligence fees or similar payments in connection with the consummation of
the transactions contemplated hereby. Each party hereto agrees to indemnify the
other against and hold the other harmless from any and all liabilities to any
persons claiming brokerage commissions or similar fees on account of services
purported to have been rendered on behalf of the indemnifying party in
connection with this Agreement or the transactions contemplated hereby and
arising out of the indemnifying party’s actions.

 

5. Covenants Regarding Indemnification. Each party hereto agrees to indemnify,
hold harmless, reimburse and defend the other party and the other party’s
officers, directors, agents, counsel, affiliates, members, managers, control
persons, and principal shareholders, as applicable, against any claim, cost,
expense, liability, obligation, loss or damage (including reasonable legal fees)
of any nature, incurred by or imposed upon the indemnified party or any such
person which results, arises out of or is based upon (i) any breach of any
representation or warranty by the indemnifying party in this Agreement or (ii)
any breach or default in performance by the indemnifying party of any covenant
or undertaking to be performed by the indemnifying party.

 

6. Miscellaneous.

 

(a) Notices. All notices, demands, requests, consents, approvals, and other
communications required or permitted hereunder shall be in writing and, unless
otherwise specified herein, shall be (i) personally served, (ii) deposited in
the mail, registered or certified, return receipt requested, postage prepaid,
(iii) delivered by reputable air courier service with charges prepaid, or (iv)
transmitted by hand delivery or facsimile, addressed as set forth on the
signature pages hereto or to such other address as such party shall have
specified most recently by written notice. Any notice or other communication
required or permitted to be given hereunder shall be deemed effective (a) upon
hand delivery or delivery by facsimile, with accurate confirmation generated by
the transmitting facsimile machine, at the address or number designated on the
signature page hereto (if delivered on a business day during normal business
hours where such notice is to be received), or the first business day following
such delivery (if delivered other than on a business day during normal business
hours where such notice is to be received) or (b) on the second business day
following the date of mailing by express courier service, fully prepaid,
addressed to such address, or upon actual receipt of such mailing, whichever
shall first occur.

 

 

 

 

(b) Entire Agreement; Assignment. This Agreement constitutes the entire
agreement between the parties hereto with respect to the subject matter hereof
and may be amended only by a writing executed by both parties hereto. Neither
the Company nor Subscriber has relied on any representations not contained or
referred to in this Agreement and the documents delivered herewith.

 

(c) Counterparts/Execution. This Agreement may be executed in any number of
counterparts and by the different signatories hereto on separate counterparts,
each of which, when so executed, shall be deemed an original, but all such
counterparts shall constitute but one and the same instrument. This Agreement
may be executed by facsimile transmission, PDF, electronic signature or other
similar electronic means with the same force and effect as if such signature
page were an original thereof.

 

(d) Law Governing this Agreement. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York without regard to
principles of conflicts of laws. Any action brought by either party hereto
against the other concerning the transactions contemplated by this Agreement
shall be brought only in the state courts of New York or in the federal courts
located in the state of New York. The parties to this Agreement hereby
irrevocably waive any objection to jurisdiction and venue of any action
instituted hereunder and shall not assert any defense based on lack of
jurisdiction or venue or based upon forum non conveniens. The parties hereto
agree to submit to the in personam jurisdiction of such courts and hereby
irrevocably waive trial by jury. The prevailing party shall be entitled to
recover from the other party its reasonable attorney’s fees and costs.

 

(e) Severability. In the event that any provision of this Agreement or any other
agreement delivered in connection herewith is invalid or unenforceable under any
applicable statute or rule of law, then such provision shall be deemed
inoperative to the extent that it may conflict therewith and shall be deemed
modified to conform with such statute or rule of law. Any such provision which
may prove invalid or unenforceable under any law shall not affect the validity
or enforceability of any other provision of any agreement. Each party hereto
hereby irrevocably waives personal service of process and consents to process
being served in any suit, action or proceeding in connection with this Agreement
by mailing a copy thereof via registered or certified mail or overnight delivery
(with evidence of delivery) to such party at the address in effect for notices
to it under this Agreement and agrees that such service shall constitute good
and sufficient service of process and notice thereof. Nothing contained herein
shall be deemed to limit in any way any right to serve process in any other
manner permitted by law.

 

(f) Captions. The captions of the various sections and paragraphs of this
Agreement have been inserted only for the purposes of convenience; such captions
are not a part of this Agreement and shall not be deemed in any manner to
modify, explain, enlarge or restrict any of the provisions of this Agreement.

 

 

 

 

SIGNATURE PAGE TO SUBSCRIPTION AGREEMENT

 

Please acknowledge your acceptance of the foregoing Subscription Agreement by
signing and returning a copy to the undersigned whereupon it shall become a
binding agreement between us.

 

 

 

  Wizard World, Inc.
a Delaware corporation           By:  /s/ Michael Mathews   Name:
Title: Michael Mathews
Executive Chairman         Address: 1350 Avenue of the Americas
2nd Floor
New York, New York 10019         Facsimile No.: (646) 607-8183         Dated:
December 21, 2011

 

 

SUBSCRIBER

Name of Subscriber:

 

Michael Mathews 2011 Children’s GRAT

 

Address:

_________________________________________

 

_________________________________________

 

Fax No.: ________________________________

 

Taxpayer ID# (if applicable): ________________

 

_________________________________________

 

(Signature)

 

By: /s/ Nancy Mathews, trustee

 

Dated: December 21, 2011

 

Number of Shares: 357,143

 

Aggregate Purchase Price: $250,000.00

 

(No. Shares x purchase price per Share)

 

 

 

[Signature Page to Wizard World, Inc. Subscription Agreement]