Exhibit 10.01

 

Securities Purchase Agreement

 

This Securities Purchase Agreement (this “Agreement”), dated as of July 24,
2015, is entered into by and between StationDigital Corporation, a Delaware
corporation (“Company”), and St. George Investments LLC, a Utah limited
liability company, its successors and/or assigns (“Investor”).

 

A.            Company and Investor are executing and delivering this Agreement
in reliance upon the exemption from securities registration afforded by the
rules and regulations promulgated by the United States Securities and Exchange
Commission (the “SEC”) under the Securities Act of 1933, as amended (the “1933
Act”).

 

B.            Investor desires to purchase and Company desires to issue and
sell, upon the terms and conditions set forth in this Agreement (i) a
Convertible Promissory Note, in the form attached hereto as Exhibit A, in the
original principal amount of $57,500.00 (the “Note”), convertible into shares of
common stock, $0.0001 par value per share, of Company (the “Common Stock”), upon
the terms and subject to the limitations and conditions set forth in such Note,
and (ii) a Warrant to Purchase Shares of Common Stock, substantially in the form
attached hereto as Exhibit B (the “Warrant”).

 

C.            This Agreement, the Note, the Warrant, and all other certificates,
documents, agreements, resolutions and instruments delivered to any party under
or in connection with this Agreement, as the same may be amended from time to
time, are collectively referred to herein as the “Transaction Documents”.

 

D.            For purposes of this Agreement: “Conversion Shares” means all
shares of Common Stock issuable upon conversion of all or any portion of the
Note; “Warrant Shares” means all shares of Common Stock issuable upon the
exercise of or pursuant to the Warrant; and “Securities” means the Note, the
Conversion Shares, the Warrant and the Warrant Shares.

 

NOW, THEREFORE, in consideration of the above recitals and other good and
valuable consideration, the receipt and adequacy of which are hereby
acknowledged, Company and Investor hereby agree as follows:

 

1.             Purchase and Sale of Securities.

 

1.1.          Purchase of Securities. Company shall issue and sell to Investor
and Investor agrees to purchase from Company the Note and the Warrant. In
consideration thereof, Investor shall pay the Purchase Price (as defined below)
to Company.

 

1.2.          Form of Payment. On the Closing Date, Investor shall pay the
Purchase Price to Company via wire transfer of immediately available funds
against delivery of the Note and the Warrant.

 

1.3.          Closing Date. Subject to the satisfaction (or written waiver) of
the conditions set forth in Section 5 and Section 6 below, the date and time of
the issuance and sale of the Securities pursuant to this Agreement (the “Closing
Date”) shall be 5:00 p.m., Eastern Time on or about July 24, 2015, or such other
mutually agreed upon time. The closing of the transactions contemplated by this
Agreement (the “Closing”) shall occur on the Closing Date by means of the
exchange by express courier and email of .pdf documents, but shall be deemed to
have occurred at the offices of Hansen Black Anderson Ashcraft PLLC in Lehi,
Utah.

 

1.4.          Collateral for the Note. The Note shall not be secured.

 

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1.5.          Original Issue Discount; Transaction Expenses. The Note carries an
original issue discount of $5,000.00 (the “OID”). In addition, Company agrees to
pay $2,500.00 to Investor to cover Investor’s legal fees, accounting costs, due
diligence, monitoring and other transaction costs incurred in connection with
the purchase and sale of the Securities (the “Transaction Expense Amount”), all
of which amount is included in the initial principal balance of the Note. The
“Purchase Price”, therefore, shall be $50,000.00, computed as follows:
$57,500.00 original principal balance, less the OID, less the Transaction
Expense Amount.

 

2.             Investor’s Representations and Warranties. Investor represents
and warrants to Company that: (i) this Agreement has been duly and validly
authorized; (ii) this Agreement constitutes a valid and binding agreement of
Investor enforceable in accordance with its terms; and (iii) Investor is an
“accredited investor” as that term is defined in Rule 501(a) of Regulation D of
the 1933 Act.

 

3.             Company’s Representations and Warranties. Company represents and
warrants to Investor that: (i) Company is a corporation duly organized, validly
existing and in good standing under the laws of its state of incorporation and
has the requisite corporate power to own its properties and to carry on its
business as now being conducted; (ii) Company is duly qualified as a foreign
corporation to do business and is in good standing in each jurisdiction where
the nature of the business conducted or property owned by it makes such
qualification necessary; (iii) Company has registered its Common Stock under
Section 15(d) of the Securities Exchange Act of 1934, as amended (the “1934
Act”), and is obligated to file reports pursuant to Section 13 or Section 15(d)
of the 1934 Act; (iv) each of the Transaction Documents and the transactions
contemplated hereby and thereby, have been duly and validly authorized by
Company; (v) this Agreement, the Note, the Warrant, and the other Transaction
Documents have been duly executed and delivered by Company and constitute the
valid and binding obligations of Company enforceable in accordance with their
terms, subject as to enforceability only to general principles of equity and to
bankruptcy, insolvency, moratorium, and other similar laws affecting the
enforcement of creditors’ rights generally; (vi) the execution and delivery of
the Transaction Documents by Company, the issuance of Securities in accordance
with the terms hereof, and the consummation by Company of the other transactions
contemplated by the Transaction Documents do not and will not conflict with or
result in a breach by Company of any of the terms or provisions of, or
constitute a default under (a) Company’s formation documents or bylaws, each as
currently in effect, (b) any indenture, mortgage, deed of trust, or other
material agreement or instrument to which Company is a party or by which it or
any of its properties or assets are bound, including any listing agreement for
the Common Stock, or (c) any existing applicable law, rule, or regulation or any
applicable decree, judgment, or order of any court, United States federal or
state regulatory body, administrative agency, or other governmental body having
jurisdiction over Company or any of Company’s properties or assets; (vii) no
further authorization, approval or consent of any court, governmental body,
regulatory agency, self-regulatory organization, or stock exchange or market or
the stockholders or any lender of Company is required to be obtained by Company
for the issuance of the Securities to Investor; (viii) none of Company’s filings
with the SEC contained, at the time they were filed, any untrue statement of a
material fact or omitted to state any material fact required to be stated
therein or necessary to make the statements made therein, in light of the
circumstances under which they were made, not misleading; (ix) Company has filed
all reports, schedules, forms, statements and other documents required to be
filed by Company with the SEC under the 1934 Act on a timely basis or has
received a valid extension of such time of filing and has filed any such report,
schedule, form, statement or other document prior to the expiration of any such
extension; (x) Company has not consummated any financing transaction that has
not been disclosed in a periodic filing with the SEC under the 1934 Act; (xi)
Company is not a “Shell Company,” as such type of “issuer” is described in Rule
144(i)(1) under the 1933 Act and is in compliance with Rule 144(i)(2) under the
1933 Act; (xii) with respect to any commissions, placement agent or finder’s
fees or similar payments that will or would become due and owing by Company to
any person or entity as a result of this Agreement or the transactions
contemplated hereby (“Broker Fees”), any such Broker Fees will be made in full
compliance with all applicable laws and regulations and only to a person or
entity that is a registered investment adviser or registered broker-dealer;
(xiii) Investor shall have no obligation with respect to any Broker Fees or with
respect to any claims made by or on behalf of other persons for fees of a type
contemplated in this subsection that may be due in connection with the
transactions contemplated hereby and Company shall indemnify and hold harmless
each of Investor, Investor’s employees, officers, directors, stockholders,
members, managers, agents, and partners, and their respective affiliates, from
and against all claims, losses, damages, costs (including the costs of
preparation and attorneys’ fees) and expenses suffered in respect of any such
claimed or existing Broker Fees; (xiv) when issued, the Conversion Shares and
the Warrant Shares will be duly authorized, validly issued, fully paid for and
non-assessable, free and clear of all liens, claims, charges and encumbrances;
(xv) neither Investor nor any of its officers, directors, stockholders, members,
managers, employees, agents or representatives has made any representations or
warranties to Company or any of its officers, directors, employees, agents or
representatives except as expressly set forth in the Transaction Documents and,
in making its decision to enter into the transactions contemplated by the
Transaction Documents, Company is not relying on any representation, warranty,
covenant or promise of Investor or its officers, directors, members, managers,
employees, agents or representatives other than as set forth in the Transaction
Documents; and (xvi) Company has performed due diligence and background research
on Investor and its affiliates including, without limitation, John M. Fife, and,
to its satisfaction, has made inquiries with respect to all matters Company may
consider relevant to the undertakings and relationships contemplated by the
Transaction Documents including, among other things, the following:
http://investing.businessweek.com/research/stocks/people/person.asp?personId=7505107&ticker=UAHC;SEC
Civil Case No. 07-C-0347 (N.D. Ill.); SEC Civil Action No. 07-CV-347 (N.D.
Ill.); and FINRA Case #2011029203701. Company, being aware of the matters
described in subsection (xvi) above, acknowledges and agrees that such matters,
or any similar matters, have no bearing on the transactions contemplated by the
Transaction Documents and covenants and agrees it will not use any such
information as a defense to performance of its obligations under the Transaction
Documents or in any attempt to avoid, modify or reduce such obligations.

 

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4.             Company Covenants. Until all of Company’s obligations under all
of the Transaction Documents are paid and performed in full, or within the
timeframes otherwise specifically set forth below, Company shall comply with the
following covenants: (i) so long as Investor beneficially owns any of the
Securities and for at least twenty (20) Trading Days (as defined in the Note)
thereafter, Company shall timely file on the applicable deadline all reports
required to be filed with the SEC pursuant to Sections 13 or 15(d) of the 1934
Act, and shall take all reasonable action under its control to ensure that
adequate current public information with respect to Company, as required in
accordance with Rule 144 of the 1933 Act, is publicly available, and shall not
terminate its status as an issuer required to file reports under the 1934 Act
even if the 1934 Act or the rules and regulations thereunder would permit such
termination; (ii) the Common Stock shall be listed or quoted for trading on any
of (a) NYSE, (b) NASDAQ, (c) OTCQX, or (d) OTCQB; (iii) when issued, the
Conversion Shares and the Warrant Shares will be duly authorized, validly
issued, fully paid for and non-assessable, free and clear of all liens, claims,
charges and encumbrances; (iv) trading in Company’s Common Stock shall not be
suspended, halted, chilled, frozen, reach zero bid or otherwise cease on the
Company’s principal trading market; and (v) Company shall not have at any given
time more than three (3) Variable Security Holders (as defined below), excluding
Investor, without Investor’s prior written consent. For purposes hereof, the
term “Variable Security Holder” means any holder of any Company securities that
are convertible into Common Stock (including without limitation convertible
debt, warrants or convertible preferred stock) with a conversion price that
varies with the market price of the Common Stock.

 

5.             Conditions to Company’s Obligation to Sell. The obligation of
Company hereunder to issue and sell the Securities to Investor at the Closing is
subject to the satisfaction, at or before the Closing Date, of each of the
following conditions:

 

5.1.          Investor shall have executed this Agreement and delivered the same
to Company.

 

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5.2.          Investor shall have delivered the Purchase Price to Company in
accordance with Section 1.2 above.

 

6.             Conditions to Investor’s Obligation to Purchase. The obligation
of Investor hereunder to purchase the Securities at the Closing is subject to
the satisfaction, at or before the Closing Date, of each of the following
conditions, provided that these conditions are for Investor’s sole benefit and
may be waived by Investor at any time in its sole discretion:

 

6.1.          Company shall have executed this Agreement and delivered the same
to Investor.

 

6.2.          Company shall have delivered to Investor the duly executed Note
and Warrant in accordance with Section 1.2 above.

 

6.3.          Company shall have delivered to Investor a fully executed
Irrevocable Letter of Instructions to Transfer Agent substantially in the form
attached hereto as Exhibit C acknowledged and agreed to in writing by Company’s
transfer agent (the “Transfer Agent”).

 

6.4.          Company shall have delivered to Investor a fully executed
Secretary’s Certificate substantially in the form attached hereto as Exhibit D
evidencing Company’s approval of the Transaction Documents.

 

6.5.          Company shall have delivered to Investor a fully executed Share
Issuance Resolution substantially in the form attached hereto as Exhibit E to be
delivered to the Transfer Agent.

 

6.6.          Company shall have delivered to Investor fully executed copies of
all other Transaction Documents required to be executed by Company herein or
therein.

 

7.            Reservation of Shares. At all times during which the Note is
convertible or the Warrant is exercisable, Company will reserve from its
authorized and unissued Common Stock to provide for the issuance of Common Stock
upon the full conversion of the Note and full exercise of the Warrant at least
(i) three (3) times the quotient obtained by dividing the Outstanding Balance
(as defined in the Note) by the Installment Conversion Price (as defined in the
Note), plus (ii) three (3) times the number of Warrant Shares (as determined
pursuant to the Warrant) deliverable upon full exercise of the Warrant (the
“Share Reserve”), but in any event not less than 1,500,000 shares of Common
Stock shall be reserved at all times for such purpose (the “Transfer Agent
Reserve”). Company further agrees that it will cause the Transfer Agent to
immediately add shares of Common Stock to the Transfer Agent Reserve in
increments of 250,000 shares as and when requested by Investor in writing from
time to time, provided that such incremental increases do not cause the Transfer
Agent Reserve to exceed the Share Reserve. In furtherance thereof, from and
after the date hereof and until such time that the Note has been paid in full
and the Warrant exercised in full, Company shall require the Transfer Agent to
reserve for the purpose of issuance of Conversion Shares under the Note and
Warrant Shares under the Warrant, a number of shares of Common Stock equal to
the Transfer Agent Reserve. Company shall further require the Transfer Agent to
hold such shares of Common Stock exclusively for the benefit of Investor and to
issue such shares to Investor promptly upon Investor’s delivery of a conversion
notice under the Note or a notice of exercise under the Warrant. Finally,
Company shall require the Transfer Agent to issue shares of Common Stock
pursuant to the Note and the Warrant to Investor out of its authorized and
unissued shares, and not the Transfer Agent Reserve, to the extent shares of
Common Stock have been authorized, but not issued, and are not included in the
Transfer Agent Reserve. The Transfer Agent shall only issue shares out of the
Transfer Agent Reserve to the extent there are no other authorized shares
available for issuance and then only with Investor’s written consent.

 

8.             Miscellaneous. The provisions set forth in this Section 8 shall
apply to this Agreement, as well as all other Transaction Documents as if these
terms were fully set forth therein.

 

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8.1.          Original Signature Pages. Each party agrees to deliver its
original signature pages to the Transaction Documents to the other party within
five (5) Trading Days of the date hereof. Notwithstanding the foregoing, the
Transaction Documents shall be fully effective upon exchange of electronic
signature pages by the parties and payment of the Purchase Price by Investor.
For the avoidance of doubt, the failure by either party to deliver its original
signature pages to the other party shall not affect in any way the validity or
effectiveness of any of the Transaction Documents, provided that such failure to
deliver original signatures shall be a breach of the party’s obligations
hereunder.

 

8.2.          Arbitration of Claims. The parties shall submit all Claims (as
defined in Exhibit F) arising under this Agreement or any other Transaction
Document or any other agreement between the parties and their affiliates to
binding arbitration pursuant to the arbitration provisions set forth in Exhibit
F attached hereto (the “Arbitration Provisions”). The parties hereby acknowledge
and agree that the Arbitration Provisions are unconditionally binding on the
parties hereto and are severable from all other provisions of this Agreement. By
executing this Agreement, Company represents, warrants and covenants that
Company has reviewed the Arbitration Provisions carefully, consulted with legal
counsel about such provisions (or waived its right to do so), understands that
the Arbitration Provisions are intended to allow for the expeditious and
efficient resolution of any dispute hereunder, agrees to the terms and
limitations set forth in the Arbitration Provisions, and that Company will not
take a position contrary to the foregoing representations. Company acknowledges
and agrees that Investor may rely upon the foregoing representations and
covenants of Company regarding the Arbitration Provisions.

 

8.3.          Governing Law; Venue. This Agreement shall be governed by and
interpreted in accordance with the laws of the State of Utah for contracts to be
wholly performed in such state and without giving effect to the principles
thereof regarding the conflict of laws. Each party consents to and expressly
agrees that exclusive venue for arbitration of any dispute arising out of or
relating to any Transaction Document or the relationship of the parties or their
affiliates shall be in Salt Lake County or Utah County, Utah. Without modifying
the parties obligations to resolve disputes hereunder pursuant to the
Arbitration Provisions, for any litigation arising in connection with any of the
Transaction Documents, each party hereto hereby (i) consents to and expressly
submits to the exclusive personal jurisdiction of any state or federal court
sitting in Salt Lake County, Utah, (ii) expressly submits to the exclusive venue
of any such court for the purposes hereof, and (iii) waives any claim of
improper venue and any claim or objection that such courts are an inconvenient
forum or any other claim or objection to the bringing of any such proceeding in
such jurisdictions or to any claim that such venue of the suit, action or
proceeding is improper.

 

8.4.          Calculation Disputes. Notwithstanding the Arbitration Provisions,
in the case of a dispute as to any determination or arithmetic calculation under
the Transaction Documents, including without limitation, calculating the
Outstanding Balance, Warrant Shares, Exercise Shares (as defined in the
Warrant), Delivery Shares (as defined in the Warrant), Lender Conversion Price
(as defined in the Note), Lender Conversion Shares (as defined in the Note),
Installment Conversion Price, Installment Conversion Shares (as defined in the
Note), Conversion Factor (as defined in the Note), Market Price (as defined in
the Note), or VWAP (as defined in the Note) (each, a “Calculation”), Company or
Investor (as the case may be) shall submit any disputed Calculation via email or
facsimile with confirmation of receipt (i) within two (2) Trading Days after
receipt of the applicable notice giving rise to such dispute to Company or
Investor (as the case may be) or (ii) if no notice gave rise to such dispute, at
any time after Investor learned of the circumstances giving rise to such
dispute. If Investor and Company are unable to agree upon such Calculation
within two (2) Trading Days of such disputed Calculation being submitted to
Company or Investor (as the case may be), then Investor shall, within two (2)
Trading Days, submit via email or facsimile the disputed Calculation to Unkar
Systems Inc. (“Unkar Systems”). Company shall cause Unkar Systems to perform the
Calculation and notify Company and Investor of the results no later than ten
(10) Trading Days from the time it receives such disputed Calculation. Unkar
Systems’ determination of the disputed Calculation shall be binding upon all
parties absent demonstrable error. Unkar Systems’ fee for performing such
Calculation shall be paid by the incorrect party, or if both parties are
incorrect, by the party whose Calculation is furthest from the correct
Calculation as determined by Unkar Systems. In the event Company is the losing
party, no extension of the Delivery Date (as defined in the Note) shall be
granted and Company shall incur all effects for failing to deliver the
applicable shares in a timely manner as set forth in the Transaction Documents.
Notwithstanding the foregoing, Investor may, in its sole discretion, designate
an independent, reputable investment bank or accounting firm other than Unkar
Systems to resolve any such dispute and in such event, all references to “Unkar
Systems” herein will be replaced with references to such independent, reputable
investment bank or accounting firm so designated by Investor.

 

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8.5.          Counterparts. Each Transaction Document may be executed in any
number of counterparts, each of which shall be deemed an original, but all of
which together shall constitute one instrument. The parties hereto confirm that
any electronic copy of another party’s executed counterpart of a Transaction
Document (or such party’s signature page thereof) will be deemed to be an
executed original thereof.

 

8.6.          Headings. The headings of this Agreement are for convenience of
reference only and shall not form part of, or affect the interpretation of, this
Agreement.

 

8.7.          Severability. In the event that any provision of this Agreement 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 to such statute or rule of
law. Any provision hereof which may prove invalid or unenforceable under any law
shall not affect the validity or enforceability of any other provision hereof.

 

8.8.          Entire Agreement. This Agreement, together with the other
Transaction Documents, contains 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 Company nor Investor makes any
representation, warranty, covenant or undertaking with respect to such matters.

 

8.9.          No Reliance. Company acknowledges and agrees that neither Investor
nor any of its officers, directors, members, managers, representatives or agents
has made any representations or warranties to Company or any of its officers,
directors, representatives, agents or employees except as expressly set forth in
the Transaction Documents and, in making its decision to enter into the
transactions contemplated by the Transaction Documents, Company is not relying
on any representation, warranty, covenant or promise of Investor or its
officers, directors, members, managers, agents or representatives other than as
set forth in the Transaction Documents.

 

8.10.         Amendments. No provision of this Agreement may be waived or
amended other than by an instrument in writing signed by the parties hereto.

 

8.11.         Notices. Any notice required or permitted hereunder shall be given
in writing (unless otherwise specified herein) and shall be deemed effectively
given on the earliest of: (i) the date delivered, if delivered by personal
delivery as against written receipt therefor or by email to an executive
officer, or by facsimile (with successful transmission confirmation), (ii) the
earlier of the date delivered or the third Trading Day after deposit, postage
prepaid, in the United States Postal Service by certified mail, or (iii) the
earlier of the date delivered or the third Trading Day after mailing by express
courier, with delivery costs and fees prepaid, in each case, addressed to each
of the other parties thereunto entitled at the following addresses (or at such
other addresses as such party may designate by five (5) calendar days’ advance
written notice similarly given to each of the other parties hereto):

 

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  If to Company:           StationDigital Corporation     Attn: Louis R. Rossi  
  Highlands Park Two, 5700 Oakland Ave, #200     St. Louis, Missouri 63110      
    If to Investor:           St. George Investments LLC     Attn: John Fife    
303 East Wacker Drive, Suite 1040     Chicago, Illinois 60601           With a
copy to (which copy shall not constitute notice):           Hansen Black
Anderson Ashcraft PLLC     Attn: Jonathan Hansen     3051 West Maple Loop Drive,
Suite 325     Lehi, Utah 84043  

 

8.12.         Successors and Assigns. This Agreement or any of the severable
rights and obligations inuring to the benefit of or to be performed by Investor
hereunder may be assigned by Investor to a third party, including its financing
sources, in whole or in part, without the need to obtain Company’s consent
thereto. Company may not assign its rights or obligations under this Agreement
or delegate its duties hereunder without the prior written consent of Investor.

 

8.13.         Survival. The representations and warranties of Company and the
agreements and covenants set forth in this Agreement shall survive the Closing
hereunder notwithstanding any due diligence investigation conducted by or on
behalf of Investor. Company agrees to indemnify and hold harmless Investor and
all its officers, directors, employees, attorneys, and agents for loss or damage
arising as a result of or related to any breach or alleged breach by Company of
any of its representations, warranties and covenants set forth in this Agreement
or any of its covenants and obligations under this Agreement, including
advancement of expenses as they are incurred.

 

8.14.         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.

 

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8.15.         Investor’s Rights and Remedies Cumulative; Liquidated Damages. All
rights, remedies, and powers conferred in this Agreement and the Transaction
Documents are cumulative and not exclusive of any other rights or remedies, and
shall be in addition to every other right, power, and remedy that Investor may
have, whether specifically granted in this Agreement or any other Transaction
Document, or existing at law, in equity, or by statute, and any and all such
rights and remedies may be exercised from time to time and as often and in such
order as Investor may deem expedient. The parties acknowledge and agree that
upon Company’s failure to comply with the provisions of the Transaction
Documents, Investor’s damages would be uncertain and difficult (if not
impossible) to accurately estimate because of the parties’ inability to predict
future interest rates and future share prices, Investor’s increased risk, and
the uncertainty of the availability of a suitable substitute investment
opportunity for Investor, among other reasons. Accordingly, any fees, charges,
and default interest due under the Note, the Warrant, and the other Transaction
Documents are intended by the parties to be, and shall be deemed, liquidated
damages (under Company’s and Investor’s expectations that any such liquidated
damages will tack back to the Closing Date for purposes of determining the
holding period under Rule 144 under the 1933 Act). The parties agree that such
liquidated damages are a reasonable estimate of Investor’s actual damages and
not a penalty, and shall not be deemed in any way to limit any other right or
remedy Investor may have hereunder, at law or in equity. The parties acknowledge
and agree that under the circumstances existing at the time this Agreement is
entered into, such liquidated damages are fair and reasonable and are not
penalties. All fees, charges, and default interest provided for in the
Transaction Documents are agreed to by the parties to be based upon the
obligations and the risks assumed by the parties as of the Closing Date and are
consistent with investments of this type. The liquidated damages provisions of
the Transaction Documents shall not limit or preclude a party from pursuing any
other remedy available at law or in equity; provided, however, that the
liquidated damages provided for in the Transaction Documents are intended to be
in lieu of actual damages.

 

8.16.         Ownership Limitation. Notwithstanding anything to the contrary
contained in this Agreement or the other Transaction Documents, if at any time
Investor shall or would be issued shares of Common Stock under any of the
Transaction Documents, but such issuance would cause Investor (together with its
affiliates) to beneficially own a number of shares exceeding the Maximum
Percentage (as defined in the Note), then Company must not issue to Investor the
shares that would cause Investor to exceed the Maximum Percentage. The shares of
Common Stock issuable to Investor that would cause the Maximum Percentage to be
exceeded are referred to herein as the “Ownership Limitation Shares”. Company
will reserve the Ownership Limitation Shares for the exclusive benefit of
Investor. From time to time, Investor may notify Company in writing of the
number of the Ownership Limitation Shares that may be issued to Investor without
causing Investor to exceed the Maximum Percentage. Upon receipt of such notice,
Company shall be unconditionally obligated to immediately issue such designated
shares to Investor, with a corresponding reduction in the number of the
Ownership Limitation Shares. For purposes of this Section, beneficial ownership
of Common Stock will be determined under Section 13(d) of the 1934 Act.

 

8.17.         Attorneys’ Fees and Cost of Collection. In the event of any
arbitration or action at law or in equity to enforce or interpret the terms of
this Agreement or any of the other Transaction Documents, the parties agree that
the party who is awarded the most money shall be deemed the prevailing party for
all purposes and shall therefore be entitled to an additional award of the full
amount of the attorneys’ fees, deposition costs, and expenses paid by such
prevailing party in connection with arbitration or litigation without reduction
or apportionment based upon the individual claims or defenses giving rise to the
fees and expenses. Nothing herein shall restrict or impair an arbitrator’s or a
court’s power to award fees and expenses for frivolous or bad faith pleading. If
(i) the Note or Warrant is placed in the hands of an attorney for collection or
enforcement prior to commencing arbitration or legal proceedings, or is
collected or enforced through any arbitration or legal proceeding, or Investor
otherwise takes action to collect amounts due under the Note or to enforce the
provisions of the Note or the Warrant; or (ii) there occurs any bankruptcy,
reorganization, receivership of Company or other proceedings affecting Company’s
creditors’ rights and involving a claim under the Note or the Warrant; then
Company shall pay the costs incurred by Investor for such collection,
enforcement or action or in connection with such bankruptcy, reorganization,
receivership or other proceeding, including, without limitation, attorneys’
fees, expenses, deposition costs, and disbursements.

 

8.18.         Waiver. No waiver of any provision of this Agreement shall be
effective unless it is in the form of a writing signed by the party granting the
waiver. No waiver of any provision or consent to any prohibited action shall
constitute a waiver of any other provision or consent to any other prohibited
action, whether or not similar. No waiver or consent shall constitute a
continuing waiver or consent or commit a party to provide a waiver or consent in
the future except to the extent specifically set forth in writing.

 

8

 

 

8.19.        Waiver of Jury Trial. EACH PARTY TO THIS AGREEMENT IRREVOCABLY
WAIVES ANY AND ALL RIGHTS SUCH PARTY MAY HAVE TO DEMAND THAT ANY ACTION,
PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR IN ANY WAY RELATED TO THIS
AGREEMENT OR THE RELATIONSHIPS OF THE PARTIES HERETO BE TRIED BY JURY. THIS
WAIVER EXTENDS TO ANY AND ALL RIGHTS TO DEMAND A TRIAL BY JURY ARISING UNDER
COMMON LAW OR ANY APPLICABLE STATUTE, LAW, RULE OR REGULATION. FURTHER, EACH
PARTY HERETO ACKNOWLEDGES THAT SUCH PARTY IS KNOWINGLY AND VOLUNTARILY WAIVING
SUCH PARTY’S RIGHT TO DEMAND TRIAL BY JURY.

 

8.20.        Time is of the Essence. Time is expressly made of the essence with
respect to each and every provision of this Agreement and the other Transaction
Documents.

 

8.21.        Voluntary Agreement. Company has carefully read this Agreement and
each of the other Transaction Documents and has asked any questions needed for
Company to understand the terms, consequences and binding effect of this
Agreement and each of the other Transaction Documents and fully understand them.
Company has had the opportunity to seek the advice of an attorney of Company’s
choosing and is executing this Agreement and each of the other Transaction
Documents voluntarily and without any duress or undue influence by Investor or
anyone else.

 

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9

 

  

IN WITNESS WHEREOF, the undersigned Investor and Company have caused this
Agreement to be duly executed as of the date first above written.

 

SUBSCRIPTION AMOUNT:

 

Principal Amount of Note: $57,500.00     Purchase Price: $50,000.00

 

  INVESTOR:       St. George Investments LLC       By: Fife Trading, Inc.,
Manager

 

  By:      /s/ John M. Fife     John M. Fife, President

 

  COMPANY:       StationDigital Corporation

 

  By:   /s/ Louis Rossi   Printed Name:     Louis Rossi   Title:     Chief
Executive Officer

 

ATTACHED EXHIBITS:

 

Exhibit A Note Exhibit B Warrant Exhibit C Irrevocable Transfer Agent
Instructions Exhibit D Secretary’s Certificate Exhibit E Share Issuance
Resolution Exhibit F Arbitration Provisions

 

[Signature Page to Securities Purchase Agreement]

 

 

 

 

Exhibit F

 

ARBITRATION PROVISIONS

 

1.          Dispute Resolution. For purposes of this Exhibit F, the term
“Claims” means any disputes, claims, demands, causes of action, liabilities,
damages, losses, or controversies whatsoever arising from related to or
connected with the transactions contemplated in the Transaction Documents and
any communications between the parties related thereto, including without
limitation any claims of mutual mistake, mistake, fraud, misrepresentation,
failure of formation, failure of consideration, promissory estoppel,
unconscionability, failure of condition precedent, rescission, and any statutory
claims, tort claims, contract claims, or claims to void, invalidate or terminate
the Agreement or any of the other Transaction Documents. The term “Claims”
specifically excludes a dispute over Calculations. The parties hereby agree that
the arbitration provisions set forth in this Exhibit F (“Arbitration
Provisions”) are binding on the parties hereto and are severable from all other
provisions in the Transaction Documents. As a result, any attempt to rescind the
Agreement or declare the Agreement or any other Transaction Document invalid or
unenforceable for any reason is subject to these Arbitration Provisions. These
Arbitration Provisions shall also survive any termination or expiration of the
Agreement. Any capitalized term not defined in these Arbitration Provisions
shall have the meaning set forth in the Agreement.

2.          Arbitration. Except as otherwise provided herein, all Claims must be
submitted to arbitration (“Arbitration”) to be conducted exclusively in Salt
Lake County or Utah County, Utah and pursuant to the terms set forth in these
Arbitration Provisions. The parties agree that the award of the arbitrator (the
“Arbitration Award”) shall be final and binding upon the parties (subject to the
appear right set forth in Section 4 below); shall be the sole and exclusive
remedy between them regarding any Claims, counterclaims, issues, or accountings
presented or pleaded to the arbitrator; and shall promptly be payable in United
States dollars free of any tax, deduction or offset (with respect to monetary
awards). Any costs or fees, including without limitation attorneys’ fees,
incident to enforcing the arbitrator’s award shall, to the maximum extent
permitted by law, be charged against the party resisting such enforcement. The
award shall include Default Interest (as defined in the Note) both before and
after the award. Judgment upon the award of the arbitrator will be entered and
enforced by a state court sitting in Salt Lake County, Utah. The parties hereby
incorporate herein the provisions and procedures set forth in the Utah Uniform
Arbitration Act, U.C.A. § 78B-11-101 et seq. (as amended or superseded from time
to time, the “Arbitration Act”). Pursuant to Section 105 of the Arbitration Act,
in the event of conflict between the terms of these Arbitration Provisions and
the provisions of the Arbitration Act, the terms of these Arbitration Provisions
shall control.

3.          Arbitration Proceedings. Arbitration between the parties will be
subject to the following procedures:

3.1           Pursuant to Section 110 of the Arbitration Act, the parties agree
that a party may initiate Arbitration by giving written notice to the other
party (“Arbitration Notice”) in the same manner that notice is permitted under
Section 8.11 of the Agreement; provided, however, that the Arbitration Notice
may not be given by email or fax. Arbitration will be deemed initiated as of the
date that the Arbitration Notice is deemed delivered under Section 8.11 of the
Agreement (the “Service Date”). After the Service Date, information may be
delivered, and notices may be given, by email or fax pursuant to Section 8.11 of
the Agreement or any other method permitted thereunder. The Arbitration Notice
must describe the nature of the controversy, the remedies sought, and the
election to commence Arbitration proceedings. All Claims in the Arbitration
Notice must be pleaded consistent with the Utah Rules of Civil Procedure.

 

Arbitration Provisions, Page 1

 

 

3.2           Within ten (10) calendar days after the Service Date, Investor
shall select and submit to Company the names of three (3) arbitrators that are
designated as “neutrals” or qualified arbitrators by Utah ADR Services
(http://www.utahadrservices.com) (such three (3) designated persons hereunder
are referred to herein as the “Proposed Arbitrators”). For the avoidance of
doubt, each Proposed Arbitrator must be qualified as a “neutral” with Utah ADR
Services. Within ten (10) calendar days after Investor has submitted to Company
the names of the Proposed Arbitrators, Company must select, by written notice to
Investor, one (1) of the Proposed Arbitrators to act as the arbitrator for the
parties under these Arbitration Provisions. If Company fails to select one of
the Proposed Arbitrators in writing within such 10-day period, then Investor may
select the arbitrator from the Proposed Arbitrators by providing written notice
of such selection to Company. If Investor fails to identify the Proposed
Arbitrators within the time period required above, then Company may at any time
prior to Investor designating the Proposed Arbitrators, select the names of
three (3) arbitrators that are designated as “neutrals” or qualified arbitrators
by Utah ADR Service by written notice to Investor. Investor may then, within ten
(10) calendar days after Company has submitted notice of its selected
arbitrators to Investor, select, by written notice to Company, one (1) of the
selected arbitrators to act as the arbitrator for the parties under these
Arbitration Provisions. If Investor fails to select in writing and within such
10-day period one of the three (3) arbitrators selected by Company, then Company
may select the arbitrator from its three (3) previously selected arbitrators by
providing written notice of such selection to Investor. Subject to Paragraph
3.12 below, the cost of the arbitrator must be paid equally by both parties;
provided, however, that if one party refuses or fails to pay its portion of the
arbitrator fee, then the other party can advance such unpaid amount (subject to
the accrual of Default Interest thereupon), with such amount added to or
subtracted from, as applicable, the award granted by the arbitrator. If Utah ADR
Services ceases to exist or to provide a list of neutrals, then the arbitrator
shall be selected under the then prevailing rules of the American Arbitration
Association. The date that the selected arbitrator agrees in writing to serve as
the arbitrator hereunder is referred to herein as the “Arbitration Commencement
Date”.

3.3           An answer and any counterclaims to the Arbitration Notice, which
must be pleaded consistent with the Utah Rules of Civil Procedure, shall be
required to be delivered to the other party within twenty (20) calendar days
after the Service Date. Upon request, the arbitrator is hereby instructed to
render a default award, consistent with the relief requested in the Arbitration
Notice, against a party that fails to submit an answer within such time period.

3.4           The party that delivers the Arbitration Notice to the other party
shall have the option to also commence concurrent legal proceedings with any
state court sitting in Salt Lake County, Utah (“Litigation Proceedings”),
subject to the following: (i) the complaint in the Litigation Proceedings is to
be substantially similar to the claims set forth in the Arbitration Notice,
provided that an additional cause of action to compel arbitration will also be
included therein, (ii) so long as the other party files an answer to the
complaint in the Litigation Proceedings and an answer to the Arbitration Notice,
the Litigation Proceedings will be stayed pending an Arbitration Award
hereunder, (iii) if the other party fails to file an answer in the Litigation
Proceedings or an answer in the Arbitration Proceedings, then the party
initiating Arbitration shall be entitled to a default judgment consistent with
the relief requested, to be entered in the Litigation Proceedings, and (iv) any
legal or procedural issue arising under the Arbitration Act that requires a
decision of a court of competent jurisdiction may be determined in the
Litigation Proceedings. Any award of the arbitrator may be entered in such
Litigation Proceedings pursuant to the Arbitration Act.

3.5           Pursuant to Section 118(8) of the Arbitration Act, the parties
agree that discovery shall be conducted in accordance with the Utah Rules of
Civil Procedure; provided, however, that incorporation of such rules will in no
event supersede the Arbitration Provisions set forth herein, including without
limitation the time limitation set forth in Paragraph 3.9 below, and the
following:

a.           Discovery will only be allowed if the likely benefits of the
proposed discovery outweigh the burden or expense, and the discovery sought is
likely to reveal information that will satisfy a specific element of a claim or
defense already pleaded in the Arbitration. The party seeking discovery shall
always have the burden of showing that all of the standards and limitations set
forth in these Arbitration Provisions are satisfied. The scope of discovery in
the Arbitration proceedings shall also be limited as follows:

(i)          To facts directly connected with the transactions contemplated by
the Agreement.

 

(ii)         To facts and information that cannot be obtained from another
source that is more convenient, less burdensome or less expensive.

 

b.            No party shall be allowed (i) more than fifteen (15)
interrogatories (including discrete subparts), (ii) more than fifteen (15)
requests for admission (including discrete subparts), (iii) more than ten (10)
document requests (including discrete subparts), or (iv) more than three
depositions (excluding expert depositions) for a maximum of seven (7) hours per
deposition.

3.6           Any party submitting any written discovery requests, including
interrogatories, requests for production, subpoenas to a party or a third party,
or requests for admissions, must prepay the estimated attorneys’ fees and costs,
as determined by the arbitrator, before the responding party has any obligation
to produce or respond.

 

Arbitration Provisions, Page 2

 

 

(a)           All discovery requests must be submitted in writing to the
arbitrator and the other party before issuing or serving such discovery
requests. The party issuing the written discovery requests must include with
such discovery requests a detailed explanation of how the proposed discovery
requests satisfy the requirements of these Arbitration Provisions and the Utah
Rules of Civil Procedure. Any party will then be allowed, within ten (10)
calendar days of receiving the proposed discovery requests, to submit to the
arbitrator an estimate of the attorneys’ fees and costs associated with
responding to such written discovery requests and a written challenge to each
applicable discovery request. After receipt of an estimate of attorneys’ fees
and costs and/or challenge(s) to one or more discovery requests, the arbitrator
will make a finding as to the likely attorneys’ fees and costs associated with
responding to the discovery requests and issue an order that (A) requires the
requesting party to prepay the attorneys’ fees and costs associated with
responding to the discovery requests, and (B) requires the responding party to
respond to the discovery requests as limited by the arbitrator within a certain
period of time after receiving payment from the requesting party. If a party
entitled to submit an estimate of attorneys’ fees and costs and/or a challenge
to discovery requests fails to do so within such 10-day period, the arbitrator
will make a finding that (A) there are no attorneys’ fees or costs associated
with responding to such discovery requests, and (B) the responding party must
respond to such discovery requests (as may be limited by the arbitrator) within
a certain period of time as determined by the arbitrator.

(b)           In order to allow a written discovery request, the arbitrator must
find that the discovery request satisfies the standards set forth in these
Arbitration Provisions and the Utah Rules of Civil Procedure. The arbitrator
must strictly enforce these standards. If a discovery request does not satisfy
any of the standards set forth in these Arbitration Provisions or the Utah Rules
of Civil Procedure, the arbitrator may modify such discovery request to satisfy
the applicable standards, or strike such discovery request in whole or in part.

(c)           Discovery deadlines will be set forth in a scheduling order issued
by the arbitrator. The parties hereby authorize and direct the arbitrator to
take such actions and make such rulings as may be necessary to carry out the
parties’ intent for the arbitration proceedings to be efficient and expeditious.

3.7           Each party may submit expert reports (and rebuttals thereto),
provided that such reports must be submitted by the deadlines established by the
arbitrator. Expert reports must contain the following: (a) a complete statement
of all opinions the expert will offer at trial and the basis and reasons for
them; (b) the expert’s name and qualifications, including a list of all
publications within the preceding 10 years, and a list of any other cases in
which the expert has testified at trial or in a deposition or prepared a report
within the preceding 10 years; and (c) the compensation to be paid for the
expert’s report and testimony. The parties are entitled to depose any other
party’s expert witness one time for no more than 4 hours. An expert may not
testify in a party’s case-in-chief concerning any matter not fairly disclosed in
the expert report.

3.8           All information disclosed by either party during the Arbitration
process (including without limitation information disclosed during the discovery
process) shall be considered confidential in nature. Each party agrees not to
disclose any confidential information received from the other party during the
discovery process unless (i) prior to or after the time of disclosure such
information becomes public knowledge or part of the public domain, not as a
result of any inaction or action of the receiving party, (ii) such information
is required by a court order, subpoena or similar legal duress to be disclosed
if such receiving party has notified the other party thereof in writing and
given it a reasonable opportunity to obtain a protective order from a court of
competent jurisdiction prior to disclosure; or (iii) disclosed to the receiving
party’s agents, representatives and legal counsel on a need to know basis who
each agree in writing not to disclose such information to any third party.
Pursuant to Section 118(5) of the Arbitration Act, the arbitrator is hereby
authorized and directed to issue a protective order to prevent the disclosure of
privileged information and confidential information upon the written request of
either party.

3.9           The parties hereby authorize and direct the arbitrator to take
such actions and make such rulings as may be necessary to carry out the parties’
intent for the arbitration proceedings to be efficient and expeditious. Pursuant
to Section 120 of the Arbitration Act, the parties hereby agree that an
Arbitration Award must be made within 150 days after the Arbitration
Commencement Date. The arbitrator is hereby authorized and directed to hold a
scheduling conference within ten (10) calendar days after the Arbitration
Commencement Date in order to establish a scheduling order with various binding
deadlines for discovery, expert testimony, and the submission of documents by
the parties to enable the arbitrator to render a decision prior to the end of
such 150-day period. The Utah Rules of Evidence will apply to any final hearing
before the arbitrator.

Arbitration Provisions, Page 3

 

 

3.10         The arbitrator shall have the right to award or include in the
Arbitration Award any relief which the arbitrator deems proper under the
circumstances, including, without limitation, specific performance and
injunctive relief, provided that the arbitrator may not award exemplary or
punitive damages.

3.11         If any part of these Arbitration Provisions is found to violate
applicable law or to be illegal, then such provision shall be modified to the
minimum extent necessary to make such provision enforceable under applicable
law.

3.12         The arbitrator is hereby directed to require the losing party to
(i) pay the full amount of any unpaid costs and fees of the arbitrator, and (ii)
reimburse the prevailing party the reasonable attorneys’ fees, arbitrator costs,
deposition costs, and other discovery costs incurred by the prevailing party.

4.          Appeals.

4.1           Following the entry of the Arbitration Award, either party (the
“Appellant”) shall have a period of thirty (30) days in which to notify the
other party (the “Appellee”), in writing, that it elects to appeal (the
“Appeal”) the Arbitration Award (such notice, an “Appeal Notice”). The date the
Appellant delivers an Appeal Notice to the Appellee is referred to herein as the
“Appeal Date”. The Appeal Notice must be delivered to the Appellee in accordance
with the provisions of Paragraph 3.1 above with respect to delivery of an
Arbitration Notice and must describe the nature of the appeal and the remedies
sought. In addition, together with its delivery of an Appeal Notice to the
Appellee, the Appellant must also pay for (and provide proof of such payment to
the Appellee together with its delivery of the Appeal Notice) a bond in the
amount of 110% of the sum it owes to the Appellee as a result of the final
decision made by the arbitrators that it is appealing. In the event neither
party delivers an Appeal Notice to the other within the deadline prescribed in
this Paragraph 4.1, each party shall lose its right to appeal and the decision
of the arbitrator shall be final.

4.2           In the event an Appellant delivers an Appeal Notice to the
Appellee in compliance with the provisions of Paragraph 4.1 above, the following
provisions shall apply with respect to the Appeal:

(a)          The Appeal will be heard by a three (3) person arbitration panel
(the “Appeal Panel”). Within ten (10) calendar days after the Appeal Date, the
Appellee shall select and submit to the Appellant the names of five (5)
arbitrators that are designated as “neutrals” or qualified arbitrators by Utah
ADR Services (http://www.utahadrservices.com) (such five designated persons
hereunder are referred to herein as the “Proposed Appeal Arbitrators”). For the
avoidance of doubt, each Proposed Appeal Arbitrator must be qualified as a
“neutral” with Utah ADR Services. Within ten (10) calendar days after the
Appellee has submitted to the Appellant the names of the Proposed Appeal
Arbitrators, the Appellant must select, by written notice to the Appellee, three
(3) of the Proposed Appeal Arbitrators to act as the members of the Appeal
Panel. If the Appellant fails to select three (3) of the Proposed Appeal
Arbitrators in writing within such 10-day period, then the Appellee may select
such three (3) arbitrators from the Proposed Appeal Arbitrators by providing
written notice of such selection to the Appellant. If the Appellee fails to
identify the Proposed Appeal Arbitrators within the time period required above,
then the Appellant may at any time prior to the Appellee designating the
Proposed Appeal Arbitrators, select the names of the five (5) Proposed Appeal
Arbitrators. The Appellee may then, within ten (10) calendar days after the
Appellant has submitted notice of its Proposed Appeal Arbitrators to the
Appellee, select, by written notice to the Appellant, three (3) of the Proposed
Appeal Arbitrators to serve on the Appeal Panel. If the Appellee fails to select
in writing and within such 10-day period the three (3) members of the Appeal
Panel, then the Appellant may select such three (3) members of the Appeal Panel
by providing written notice of such selection to the Appellee. After the three
(3) members of the Appeal Panel are selected, the Appellee shall designate in
writing to the Appellant the name of one of such three (3) arbitrators to serve
as the lead arbitrator. Subject to Paragraph 4.2(d) below, the cost of the
Appeal Panel must be paid entirely by the Appellant. If Utah ADR Services ceases
to exist or to provide a list of neutrals, then the arbitrators shall be
selected under the then prevailing rules of the American Arbitration
Association. The date that all three (3) selected arbitrators agree in writing
to serve as the arbitrators hereunder is referred to herein as the “Appeal
Commencement Date”.

(b)          Within seven (7) days of the Appeal Commencement Date, Appellant
shall deliver to the Appeal Panel and to Appellee a memorandum in support of
appeal describing in detail its basis and arguments for appealing the
Arbitration Award (the “Memorandum in Support”). Within seven (7) days of
Appellant’s delivery of the Memorandum in Support, Appellee shall deliver to the
Appeal Panel and to Appellant a memorandum in opposition to the Memorandum in
Support (the “Memorandum in Opposition”). Within seven (7) days of Appellee’s
delivery of the Memorandum in Opposition, Appellant shall deliver to the Appeal
Panel and to Appellee a reply memorandum to the Memorandum in Opposition.

 

Arbitration Provisions, Page 4

 

 

(c)          The parties hereby agree that the Appeal must be heard by the
Appeal Panel within thirty (30) calendar days of the Appeal Commencement Date
and that the Appeal Panel’s Arbitration Award must be made within thirty (30)
days after the Appeal is heard, and in any event within sixty (60) days of the
Appeal Commencement Date. The Utah Rules of Evidence will apply to any final
hearing before the Appeal Panel.

(d)          The Appeal Panel is hereby directed to require the losing party to
(i) pay the full amount of any unpaid costs and fees of the Appeal Panel, and
(ii) reimburse the prevailing party the reasonable attorneys’ fees, arbitrator
costs, deposition costs, and other discovery costs incurred by the prevailing
party.

 

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Arbitration Provisions, Page 5