Exhibit 10.1

 

 

GLOBE PHOTOS, INC.

NOTE AND WARRANT PURCHASE AGREEMENT

 

This Note and Warrant Purchase Agreement (this “Agreement”), dated as of
_______________, 2019, is entered into by and among Globe Photos, Inc., a
Delaware corporation (the “Company”), and the persons and entities listed on the
schedule of investors attached hereto as Schedule I (each an “Investor” and,
collectively, the “Investors”).

 

RECITALS

 

A.       On the terms and subject to the conditions set forth herein, each
Investor is willing to purchase from the Company, and the Company is willing to
sell to such Investor, a promissory note in the principal amount set forth
opposite such Investor’s name on Schedule I hereto and a warrant to purchase
common stock equivalent to twenty-five percent of the principal amount of the
promissory note purchased by such Investor.

 

B.       Capitalized terms not otherwise defined herein shall have the meaning
set forth in the form of Note (as defined below) attached hereto as Exhibit A.

 

AGREEMENT

 

NOW THEREFORE, in consideration of the foregoing, and the representations,
warranties, and conditions set forth below, the parties hereto, intending to be
legally bound, hereby agree as follows:

 

1.     Issuance of Notes and Warrants.

 

(a)   Issuance of Notes. At the Closing (as defined below), the Company agrees
to issue and sell to each of the Investors, and, subject to all of the terms and
conditions hereof, each of the Investors severally agrees to purchase a secured
convertible promissory note in the form of Exhibit A hereto (each, a “Note” and,
collectively, the “Notes”) in the principal amount set forth opposite the
respective Investor’s name on Schedule I hereto. The obligations of the
Investors to purchase Notes are several and not joint.

 

(b)   Issuance of Warrants. Subject to the terms and conditions of this
Agreement, at the Closing (as defined below), the Company shall issue and
deliver to each Investor participating in the Closing, a common stock purchase
warrant (each such warrant, a “Warrant” and collectively, the “Warrants”, and
together with the Notes and the shares of stock issuable upon exercise of the
Warrants, the “Securities”) providing each Investor the right to purchase that
number of shares of the Company’s common stock equal to twenty-five percent
(25%) of said Investor’s Note as “warrant coverage.” The Warrants shall each be
in substantially the form of Exhibit B attached hereto.

 

(c)   Bonus Perks. As an additional bonus “perk”, each Investor that purchases a
Note of $75,000 or more in connection with this Agreement shall receive an
authenticated original picture of Marilyn Monroe from her official photographer.
The original picture has the provenance of notes from the photographer and
original stamps on the back of the photos. These photos come from the archives
of the Company.

 

(d)   Delivery. The sale and purchase of the Securities shall take place at a
closing (the “Closing”) to be held at such place and time as the Company and the
Investors may determine (the “Closing Date”). At the Closing, the Company will
deliver to each of the Investors the respective Note and Warrant to be purchased
by such Investor, against receipt by the Company of the corresponding purchase
price set forth on Schedule I hereto (the “Purchase Price”). Each of the Notes
and Warrants will be registered in such Investor’s name in the Company’s
records.

 

 

 

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(e)   Use of Proceeds. The proceeds of the sale and issuance of the Securities
shall be used for general corporate purposes.

 

(f)    Payments. The Company will make all cash payments due under the Notes in
immediately available funds by 11:00 a.m. Pacific time on the date such payment
is due in the manner and at the address for such purpose specified below each
Investor’s name on Schedule I hereto, or at such other address as a Investor or
other registered holder of a Note may from time to time direct in writing.

 

2.     Representations and Warranties of the Company. The Company represents and
warrants to each Investor that:

 

(a)   Due Incorporation, Qualification, etc. The Company (i) is a corporation
duly organized, validly existing and in good standing under the laws of its
state of incorporation; (ii) has the power and authority to own, lease and
operate its properties and carry on its business as now conducted; and (iii) is
duly qualified, licensed to do business and in good standing as a foreign
corporation in each jurisdiction where the failure to be so qualified or
licensed could reasonably be expected to have a Material Adverse Effect.

 

(b)   Authority. The execution, delivery and performance by the Company of each
Transaction Document to be executed by the Company and the consummation of the
transactions contemplated thereby (i) are within the power of the Company and
(ii) have been duly authorized by all necessary actions on the part of the
Company.

 

(c)   Enforceability. Each Transaction Document executed, or to be executed, by
the Company has been, or will be, duly executed and delivered by the Company and
constitutes, or will constitute, a legal, valid and binding obligation of the
Company, enforceable against the Company in accordance with its terms, except as
limited by bankruptcy, insolvency or other laws of general application relating
to or affecting the enforcement of creditors’ rights generally and general
principles of equity.

 

(d)   Non-Contravention. The execution and delivery by the Company of the
Transaction Documents executed by the Company and the performance and
consummation of the transactions contemplated thereby do not and will not
(i) violate the Company’s Certificate of Incorporation or Bylaws ) (“Charter
Documents”) or any judgment, order, writ, decree, statute, rule or regulation
applicable to the Company; (ii) violate any provision of, or result in the
breach or the acceleration of, or entitle any other Person to accelerate
(whether after the giving of notice or lapse of time or both), any mortgage,
indenture, agreement, instrument or contract to which the Company is a party or
by which it is bound; or (iii) result in the creation or imposition of any lien
upon any property, asset or revenue of the Company or in the suspension,
revocation, impairment, forfeiture, or nonrenewal of any permit, license,
authorization or approval applicable to the Company, its business or operations,
or any of its assets or properties.

 

(e)   Approvals. No consent, approval, order or authorization of, or
registration, declaration or filing with, any governmental authority or other
Person (including, without limitation, the shareholders of any Person) is
required in connection with the execution and delivery of the Transaction
Documents executed by the Company and the performance and consummation of the
transactions contemplated thereby.

 

(f)    No Violation or Default. The Company is not in violation of or in default
with respect to (i) its Charter Documents or any judgment, order, writ, or
decree, or any material statute, rule or regulation applicable to such Person;
or (ii) any mortgage or indenture, or any material agreement, instrument or
contract to which such Person is a party or by which it is bound (nor is there
any waiver in effect which, if not in effect, would result in such a violation
or default).

 

(g)   Litigation. No actions (including, without limitation, derivative
actions), suits, proceedings or investigations are pending or, to the knowledge
of the Company, threatened against the Company at law or in equity in any court
or before any other governmental authority.

 

(h)   Title. The Company owns and has good and marketable title in fee simple
absolute to, or a valid leasehold interest in, all its real properties and good
title to its other assets and properties. Such assets and properties are subject
to no Lien other than any Lien arising or permitted under the Transaction
Documents.

 

 

 

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(i)    Intellectual Property. To its knowledge, the Company owns or possesses
sufficient legal rights to all patents, trademarks, service marks, trade names,
copyrights, trade secrets, licenses, information, processes and other
intellectual property rights necessary for its business as now conducted and as
proposed to be conducted without any conflict with, or infringement of the
rights of, others. Such intellectual property rights are subject to no Lien
other than any Lien arising or permitted under the Transaction Documents.

 

3.     Representations and Warranties of Investors. Each Investor, for that
Investor alone, represents and warrants to the Company upon the acquisition of
the Securities as follows:

 

(a)   Binding Obligation. Such Investor has full legal capacity, power and
authority to execute and deliver this Agreement and to perform its obligations
hereunder. Each of this Agreement, the Note and the Warrant issued to such
Investor is a valid and binding obligation of the Investor, enforceable in
accordance with its terms, except as limited by bankruptcy, insolvency or other
laws of general application relating to or affecting the enforcement of
creditors’ rights generally and general principles of equity.

 

(b)   Securities Law Compliance. Such Investor has been advised that the
Securities have not been registered under the Securities Act, or any state
securities laws and, therefore, cannot be resold unless they are registered
under the Securities Act and applicable state securities laws or unless an
exemption from such registration requirements is available. Such Investor is
aware that, the Company is under no obligation to effect any such registration
with respect to the Securities or to file for or comply with any exemption from
registration. Such Investor has not been formed solely for the purpose of making
this investment and is purchasing the Securities to be acquired by such Investor
hereunder for its own account for investment, not as a nominee or agent, and not
with a view to, or for resale in connection with, the distribution thereof. Such
Investor has such knowledge and experience in financial and business matters
that such Investor is capable of evaluating the merits and risks of such
investment, is able to incur a complete loss of such investment and is able to
bear the economic risk of such investment for an indefinite period of time. Such
Investor is an accredited investor as such term is defined in Rule 501 of
Regulation D under the Securities Act, and explained in Schedule II hereto.

 

(c)   Access to Information. Such Investor acknowledges that the Company has
given such Investor access to the corporate records and accounts of the Company
and to all information in its possession relating to the Company, has made its
officers and representatives available for interview by such Investor, and has
furnished such Investor with all documents and other information required for
such Investor to make an informed decision with respect to the purchase of the
Securities.

 

4.     Conditions to Closing of the Investors. Each Investor’s obligations at
the Closing are subject to the fulfillment, on or prior to the Closing Date, of
all of the following conditions, any of which may be waived in whole or in part
by all of the Investors:

 

(a)   Representations and Warranties. The representations and warranties made by
the Company in Section 2 hereof shall have been true and correct when made, and
shall be true and correct on the Closing Date.

 

(b)   Governmental Approvals and Filings. Except for any notices required or
permitted to be filed after the Closing Date with certain federal and state
securities commissions, the Company shall have obtained all governmental
approvals required in connection with the lawful sale and issuance of the
Securities.

 

(c)   Legal Requirements. At the Closing, the sale and issuance by the Company,
and the purchase by the Investors, of the Securities shall be legally permitted
by all laws and regulations to which the Investors or the Company are subject.

 

(d)   Proceedings and Documents. All corporate and other proceedings in
connection with the transactions contemplated at the Closing and all documents
and instruments incident to such transactions shall be reasonably satisfactory
in substance and form to the Investors.

 

(e)   Transaction Documents. The Company shall have duly executed and delivered
to the Investors this Agreement and each Note issued hereunder.

 

 

 

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(f)    Corporate Documents. The Company shall have delivered to the Investors
each of the following: a Certificate of Incorporation of the Company, certified
as of a recent date prior to the Closing Date by the Secretary of State of
Delaware.

 

5.     Conditions to Obligations of the Company. The Company’s obligation to
issue and sell the Securities at the Closing is subject to the fulfillment, on
or prior to the Closing Date, of the following conditions, any of which may be
waived in whole or in part by the Company:

 

(a)   Representations and Warranties. The representations and warranties made by
the Investors in Section 3 hereof shall be true and correct when made, and shall
be true and correct on the Closing Date.

 

(b)   Governmental Approvals and Filings. Except for any notices required or
permitted to be filed after the Closing Date with certain federal and state
securities commissions, the Company shall have obtained all governmental
approvals required in connection with the lawful sale and issuance of the
Securities.

 

(c)   Legal Requirements. At the Closing, the sale and issuance by the Company,
and the purchase by the Investors, of the Securities shall be legally permitted
by all laws and regulations to which the Investors or the Company are subject.

 

(d)   Purchase Price. Each Investor shall have delivered to the Company the
Purchase Price in respect of the Note being purchased by such Investor
referenced in Section 1(b) hereof.

 

6.     Miscellaneous.

 

(a)   Registration Rights. Whenever the Company proposes to register any of its
securities under the Securities Act of 1933, as amended (other than pursuant to
a registration primarily for sales of securities to employees of the Company
under Form S-8), the Company will give prompt written notice to the Investors of
its intention to effect such a registration and will include in such
registration all the shares held by Investors (a "Piggyback Registration") with
respect to which the Company has received written requests for inclusion therein
within five (5) business days after the receipt of the Company's notice.

 

(b)   Lock-Up. Each Investor hereby agrees that, if they elect to exercise their
Piggyback Registration Rights set forth in Section 6(a) above, they will not,
without the prior written consent of the managing underwriter, during the period
commencing on the date of the final prospectus relating to the Company’s
registered offering and ending on the date specified by the Company and the
managing underwriter (such period not to exceed ninety (90) days) (the “Lock-Up
Period), directly or indirectly, (1) offer, sell, assign, transfer, pledge,
contract to sell, sell any option or contract to purchase, purchase any option
or contract to sell, grant any option for sale (including any short sale), right
or warrant to purchase, lend, establish an open “put equivalent position”
(within the meaning of Rule 16a-1(h) under the Securities Exchange Act of 1934,
as amended (the “Exchange Act”), or otherwise dispose of, or enter into any
transaction which is designed to or could be expected to result in the
disposition of, any shares of common stock or securities convertible into or
exercisable or exchangeable for any equity securities of the Company (including,
without limitation, shares of common stock or any such securities which may be
deemed to be beneficially owned by the undersigned in accordance with the rules
and regulations promulgated by the Securities and Exchange Commission from time
to time (such shares or securities, the “Beneficially Owned Shares”)), or
publicly announce any intention to do any of the foregoing, (2) enter into any
swap, hedge or other agreement or arrangement that transfers in whole or in
part, the economic risk of ownership of any Beneficially Owned Shares, Common
Stock or securities convertible into or exercisable or exchangeable for any
equity securities of the Company, or (3) engage in any short selling of any
Beneficially Owned Shares, Common Stock or securities convertible into or
exercisable or exchangeable for any equity securities of the Company, whether
any such transaction described in clause (1), (2) or (3) above is to be settled
by delivery of shares of Common Stock or such other securities, in cash or
otherwise. The underwriters in connection with the registration are intended
third party beneficiaries of this Section 6 (b) and shall have the right, power
and authority to enforce the provisions hereof as though they were a party
hereto. Each Investor further agrees to execute such agreements as may be
reasonably requested by the underwriters in connection with the registration
that are consistent with this Section 6(b) or that are necessary to give further
effect thereto.

 

(c)   Waivers and Amendments. Any provision of this Agreement may be amended,
waived or modified only upon the written consent of the Company and Investors
holding a Majority in Interest of the Notes.

 

(d)   Governing Law. This Agreement and all actions arising out of or in
connection with this Agreement shall be governed by and construed in accordance
with the laws of the State of Nevada, without regard to the conflicts of law
provisions of the State of Nevada or of any other state.

 

(e)   Survival. The representations, warranties, covenants and agreements made
herein shall survive the execution and delivery of this Agreement.

 

 

 

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(f)    Successors and Assigns. Subject to the restrictions on transfer described
in Sections 6(g) and 7(h) below, the rights and obligations of the Company and
the Investors shall be binding upon and benefit the successors, assigns, heirs,
administrators and transferees of the parties.

 

(g)   Registration, Transfer and Replacement of the Securities. The Securities
issuable under this Agreement shall be registered on the books and records of
the Company. The Company will keep, at its principal executive office, books for
the registration and registration of transfer of the Securities. Prior to
presentation of any Note for registration of transfer, the Company shall treat
the Person in whose name such Note is registered as the owner and holder of such
Note for all purposes whatsoever, whether or not such Note shall be overdue, and
the Company shall not be affected by notice to the contrary. Subject to any
restrictions on or conditions to transfer set forth in any Note, the holder of
any Note, at its option, may in person or by duly authorized attorney surrender
the same for exchange at the Company’s chief executive office, and promptly
thereafter and at the Company’s expense, except as provided below, receive in
exchange therefor one or more new Note(s), each in the principal requested by
such holder, dated the date to which interest shall have been paid on the Note
so surrendered or, if no interest shall have yet been so paid, dated the date of
the Note so surrendered and registered in the name of such Person or Persons as
shall have been designated in writing by such holder or its attorney for the
same principal amount as the then unpaid principal amount of the Note so
surrendered. Upon receipt by the Company of evidence reasonably satisfactory to
it of the ownership of and the loss, theft, destruction or mutilation of any
Note and (a) in the case of loss, theft or destruction, of indemnity reasonably
satisfactory to it; or (b) in the case of mutilation, upon surrender thereof,
the Company, at its expense, will execute and deliver in lieu thereof a new Note
executed in the same manner as the Note being replaced, in the same principal
amount as the unpaid principal amount of such Note and dated the date to which
interest shall have been paid on such Note or, if no interest shall have yet
been so paid, dated the date of such Note.

 

(h)   Assignment by the Company. The rights, interests or obligations hereunder
may not be assigned, by operation of law or otherwise, in whole or in part, by
the Company without the prior written consent of Investors holding a Majority in
Interest of the Notes.

 

(i)    Entire Agreement. This Agreement together with the other Transaction
Documents constitute and contain the entire agreement among the Company and
Investors and supersede any and all prior agreements, negotiations,
correspondence, understandings and communications among the parties, whether
written or oral, respecting the subject matter hereof.

 

(j)    Notices. All notices, requests, demands, consents, instructions or other
communications required or permitted hereunder shall in writing and faxed,
mailed or delivered to each party as follows: (i) if to a Investor, at such
Investor’s address or facsimile number set forth in the Schedule of Investors
attached as Schedule I, or at such other address as such Investor shall have
furnished the Company in writing, or (ii) if to the Company, at 6445 South
Tenaya Way, B-130, Las Vegas, NV 89113, or at such other address or facsimile
number as the Company shall have furnished to the Investors in writing. All such
notices and communications will be deemed effectively given the earlier of
(i) when received, (ii) when delivered personally, (iii) one business day after
being delivered by facsimile (with receipt of appropriate confirmation),
(iv) one business day after being deposited with an overnight courier service of
recognized standing or (v) four days after being deposited in the U.S. mail,
first class with postage prepaid.

 

(k)   Separability of Agreements; Severability of this Agreement. The Company’s
agreement with each of the Investors is a separate agreement and the sale of the
Securities to each of the Investors is a separate sale. Unless otherwise
expressly provided herein, the rights of each Investor hereunder are several
rights, not rights jointly held with any of the other Investors. Any invalidity,
illegality or limitation on the enforceability of the Agreement or any part
thereof, by any Investor whether arising by reason of the law of the respective
Investor’s domicile or otherwise, shall in no way affect or impair the validity,
legality or enforceability of this Agreement with respect to other Investors. If
any provision of this Agreement shall be judicially determined to be invalid,
illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby.

 

(l)    Counterparts. This Agreement may be executed in one or more counterparts,
each of which will be deemed an original, but all of which together will
constitute one and the same agreement. Facsimile copies of signed signature
pages will be deemed binding originals.

 

 

 

 

 

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The parties have caused this Agreement to be duly executed and delivered by
their proper and duly authorized officers as of the date and year first written
above.

  

  COMPANY:       GLOBE PHOTOS, INC.   a Delaware corporation      
By:     _____________________   Stuart Scheinman, CEO       INVESTOR:      
By:_____

 

ÿ By checking this box, Investor represents and warrants to the Company that the
Investor is an "Accredited Investor" as such term is defined in Rule 501 of
Regulation D promulgated under the United States Securities Act of 1933, as
amended (the "Act"). The Investor acknowledges having reviewed and considered
the definition of “Accredited Investor” attached to hereto as Schedule II.

 

 

 

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SCHEDULE I

 

 

 

Name and Address Cash Loan Conversion Total Note Amount                        
       

All payments on account of the Notes shall be made by bank wire transfer of
immediately available funds to:

 

 

 

 

 

 

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SCHEDULE II

 

 

The Investor will be an "Accredited Investor" as such term is defined in Rule
501 of Regulation D promulgated under the United States Securities Act of 1933,
as amended (the "Act") if the Investor is any of the following:

 

1.                Any bank as defined in section 3(a)(2) of the Act, or any
savings and loan association or other institution as defined in section
3(a)(5)(A) of the Act whether acting in its individual or fiduciary capacity;
any broker or dealer registered pursuant to section 15 of the Securities
Exchange Act of 1934; any insurance company as defined in section 2(a)(13) of
the Act; any investment company registered under the Investment Company Act of
1940 or a business development company as defined in section 2(a)(48) of that
Act; any Small Business Investment Company licensed by the U.S. Small Business
Administration under section 301(c) or (d) of the Small Business Investment Act
of 1958; any plan established and maintained by a state, its political
subdivisions, or any agency or instrumentality of a state or its political
subdivisions, for the benefit of its employees, if such plan has total assets in
excess of $5,000,000; any employee benefit plan within the meaning of the
Employee Retirement Income Security Act of 1974 if the investment decision is
made by a plan fiduciary, as defined in section 3(21) of such act, which is
either a bank, savings and loan association, insurance company, or registered
investment adviser, or if the employee benefit plan has total assets in excess
of $5,000,000 or, if a self-directed plan, with investment decisions made solely
by persons that are accredited investors;

 

2.                Any private business development company as defined in section
202(a)(22) of the Investment Advisers Act of 1940;

 

3.                Any organization described in section 501(c)(3) of the
Internal Revenue Code, corporation, Massachusetts or similar business trust, or
partnership, not formed for the specific purpose of acquiring the securities
offered, with total assets in excess of $5,000,000;

 

4.                Any director, executive officer, or general partner of the
issuer of the securities being offered or sold, or any director, executive
officer, or general partner of a general partner of that issuer;

 

5.                Any natural person whose individual net worth, or joint net
worth with that person's spouse, at the time of his purchase exceeds $1,000,000,
exclusive of the value of such person’s primary residence;

 

6.                Any natural person who had an individual income in excess of
$200,000 in each of the two most recent years or joint income with that person's
spouse in excess of $300,000 in each of those years and has a reasonable
expectation of reaching the same income level in the current year;

 

7.                Any trust, with total assets in excess of $5,000,000, not
formed for the specific purpose of acquiring the securities offered, whose
purchase is directed by a sophisticated person as described in Rule
506(b)(2)(ii) and

 

8.                Any entity in which all of the equity owners are accredited
investors.

 

 

 

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Exhibit A

 

FORM OF NOTE

 

 

 

 

 

 

 

 

 

 

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Exhibit B

 

FORM OF WARRANT

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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