BLOW
& DRIVE INTERLOCK CORPORATION


 


 



 


SECURITIES
PURCHASE AGREEMENT


 


 






 




    	 



    	 	 	 



    

 


SECURITIES
PURCHASE AGREEMENT


 


This
Securities Purchase Agreement (this “Agreement”) is made and entered into effective as of the 7th day of August, 2015
(the “Effective Date”) by and between Blow & Drive Interlock Corporation, a Delaware corporation (the “Company”),
and David Stuart Petlak, a(n) Individual (the “Purchaser”). The Company and Purchaser shall each be referred to as
a “Party” and collectively as the “Parties.”


 


AGREEMENT


 


1.PURCHASE
OF SECURITIES: On the Closing Date (as hereinafter defined), subject to the terms and conditions set forth in this Agreement,
the Purchaser hereby agrees to purchase, and the Company hereby agrees to sell, a $50,000 principal amount convertible promissory
note, in the form attached hereto as Exhibit B (the “Note”), convertible into shares of the Company’s
common stock for a total purchase price of fifty thousand dollars ($50,000) (the “Purchase Price”). In addition to
the Note the Purchaser will be issued a warrant to purchase Eighty Thousand (80,000) shares of the Company’s common stock
at an exercise price of $0.80 per share in the form attached hereto as Exhibit C (the “Warrant”). Together
the Note and the Warrant, and the Company’s shares of common stock underlying the Note and the Warrant, will be referred
herein as the “Securities.”


 


 2. CLOSING AND DELIVERY:




 


a)Upon
the terms and subject to the conditions set forth herein, the consummation of the purchase and sale of the Note (the “Closing”)
shall be held simultaneous with the execution of this Agreement, or at such other time mutually agreed upon between the constituent
Parties (the “Closing Date”). The Closing shall take place at the offices of counsel for the Company set forth in
Section 6 hereof, or by the exchange of documents and instruments by mail, courier, facsimile and wire transfer to the extent
mutually acceptable to the Parties hereto.


 


 b) At the Closing:




 


(i)The
Company and the Purchaser shall execute this Agreement, and the Company will execute the Note and the Warrant which shall serve
as evidence of ownership of the Note and the Warrant, free from restrictions on transfer except as set forth in this Agreement
and federal and state securities laws.


 


(ii)
The Purchaser shall deliver to the Company the Purchase Price.


 




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3.REPRESENTATIONS,WARRANTIESANDAGREEMENTSBY
PURCHASER: The Purchaser hereby represents, warrants and agrees as follows:


 


a)Purchase
for Own Account. Purchaser represents that he is acquiring the Securities solely for his own account and beneficial
interest for investment and not for sale or with a view to distribution of the Securities or any part thereof, has no present
intention of selling (in connection with a distribution or otherwise), granting any participation in, or otherwise
distributing the same, and does not presently have reason to anticipate a change in such intention.


 


b)Ability
to Bear Economic Risk. Purchaser acknowledges that an investment in the Securities involves a high degree of risk, and represents
that he is able, without materially impairing his financial condition, to hold the Securities for an indefinite period of time
and to suffer a complete loss of his investment.


 


c)Access
to Information. The Purchaser acknowledges that the Purchaser has been furnished with such financial and other
information concerning the Company, the directors and officers of the Company, and the business and proposed business of the
Company as the Purchaser considers necessary in connection with the Purchaser’s investment in the Securities, and is
aware the Company makes quarterly filings with the Securities and Exchange Commission viewable on the EDGAR system. As a
result, the Purchaser is thoroughly familiar with the proposed business, operations, properties and financial condition of
the Company and has discussed with officers of the Company any questions the Purchaser may have had with respect thereto. The
Purchaser understands:


 


(i)The
risks involved in this investment, including the speculative nature of the investment;


 


(ii)The
financial hazards involved in this investment, including the risk of losing the Purchaser’s entire
investment;


 


(iii)The
lack of liquidity and restrictions on transfers of the Securities; and


 


 (iv) The tax consequences of this investment.




 


The
Purchaser has consulted with the Purchaser’s own legal, accounting, tax, investment and other advisers with respect to
the tax treatment of an investment by the Purchaser in the Securities and the merits and risks of an investment in the Securities.


 


d)Securities
Part of Private Placement. The Purchaser has been advised that the Securities have not been registered under the
Securities Act of 1933, as amended (the “Act”), or qualified under the securities law of any state, on the
ground, among others, that no distribution or public offering of the Securities is to be effected and the Securities will be
issued by the Company in connection with a transaction that does not involve any public offering within the meaning of
section 4(a)(2) of the Act and/or Regulation D as promulgated by the Securities and Exchange Commission under the Act, and
under any applicable state blue sky authority. The Purchaser understands that the Company is relying in part on the Purchaser’s representations as set forth herein for purposes of claiming such exemptions and that the basis for such exemptions
may not be present if, notwithstanding the Purchaser’s representations , the Purchaser has in mind merely acquiring
the Securities for resale on the occurrence or nonoccurrence of some predetermined event. The Purchaser has no such
intention.


 




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e)Purchaser
Not Affiliated with Company. The Purchaser, either alone or with the Purchaser’s professional advisers (i) are
unaffiliated with, have no equity interest in, and are not compensated by, the Company or any affiliate or selling agent of
the Company, directly or indirectly (other than as set forth in the Investor Questionnaire attached hereto as Exhibit A); (ii)
has such knowledge and experience in financial and business matters that the Purchaser is capable of evaluating the merits
and risks of an investment in the Securities; and (iii) has the capacity to protect the Purchaser’s own interests in
connection with the Purchaser’s proposed investment in the Securities.


 


f)Further
Limitations on Disposition. Purchaser further acknowledges that the Securities are restricted securities under Rule 144 of
the Act, and, therefore, if the Company, in its sole discretion, chooses to issue any certificates reflecting the ownership interest
in the Securities, those certificates will contain a restrictive legend substantially similar to the following:


 


THESE
SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”). THEY MAY NOT BE SOLD,
OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THE SECURITIES UNDER THE
ACT OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED.


 


Without
in any way limiting the representations set forth above, Purchaser further agrees not to make any disposition of all or any portion
of the Securities unless and until:


 


(i)There
is then in effect a Registration Statement under the Act covering such proposed disposition and such disposition is made in accordance
with such Registration Statement; or


 


(ii)Purchaser
shall have obtained the consent of the Company and notified the Company of the proposed disposition and shall have furnished the
Company with a detailed statement of the circumstances surrounding the proposed disposition, and if reasonably requested by the
Company, Purchaser shall have furnished the Company with an opinion of counsel, reasonably satisfactory to the Company, that such
disposition will not require registration under the Act or any applicable state securities laws.


 




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Notwithstanding
the provisions of subparagraphs (i) and (ii) above, no such registration statement or opinion of counsel shall be necessary for
a transfer by such Purchaser to a partner (or retired partner) of Purchaser, or transfers by gift, will or intestate succession
to any spouse or lineal descendants or ancestors, if all transferees agree in writing to be subject to the terms hereof to the
same extent as if they were Purchasers hereunder as long as the consent of the Company is obtained.


 


 g) Accredited Investor Status (Please check one). Purchaser




 


x
  is


 


is
not


 


an
“accredited investor” as such term is defined in Rule 501 under the Act because Purchaser either:


 


(i)has
a net worth of at least $1,000,000 (for purposes of this question, Purchaser may include spouse’s net worth and may include
the fair market value of home furnishings and automobiles, but must exclude from the calculation the value of Purchaser’s
primary residence and the related amount of any indebtedness on primary residence up to the fair market value of the primary residence
(any indebtedness that exceeds the fair market value of the primary residence must be deducted from net worth calculation)), or


 


(ii)had
an individual income of more than $200,000 in each of the two most recent calendar years, and reasonably expects to have an
individual income in excess of $200,000 in the current calendar year; or along with Purchaser’s spouse had joint
income in excess of $300,000 in each of the two most recent calendar years, and reasonably expects to have a joint income in
excess of $300,000 in the current calendar year.


 


For
purposes of this Agreement, “individual income” means “adjusted gross income” as reported for Federal
income tax purposes, exclusive of any income attributable to a spouse or to property owned by a spouse: (i) the amount of any
interest income received which is tax-exempt under Section 103 of the Internal Revenue Code of 1986, as amended, (the “Code”),
(ii) the amount of losses claimed as a limited partner in a limited partnership (as reported on Schedule E of form 1040), (iii)
any deduction claimed for depletion under Section 611 et seq. of the Code and (iv) any amount by which income from long-term capital
gains has been reduced in arriving at adjusted gross income pursuant to the provisions of Sections 1202 of the Internal Revenue
Code as it was in effect prior to enactment of the Tax Reform Act of 1986.


 


For
purposes of this Agreement, “joint income” means, “adjusted gross income,” as reported for Federal
income tax purposes, including any income attributable to a spouse or to property owned by a spouse, and increased by the
following amounts: (i) the amount of any interest income received which is tax-exempt under Section 103 of the Internal
Revenue Code of 1986, as amended (the “Code”), (ii) the amount of losses claimed as a limited partner in a
limited partnership (as reported on Schedule E of Form 1040), (iii) any deduction claimed for depletion under Section 611 et
seq. of the Code and (iv) any amount by which income from long-term capital gains has been reduced in arriving at adjusted
gross income pursuant to the provisions of Section 1202 of the Internal Revenue Code as it was in effect prior to enactment
of the Tax Reform Act of 1986.


 




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For
the purposes of this Agreement, “net worth” means (except as otherwise specifically defined) the excess of total assets
at fair market value, including home and personal property , over total liabilities, including mortgages and income taxes on unrealized
appreciation of assets.


 


 h) Purchaser Qualifications.




 


(i)If
the Purchaser is an individual, the Purchaser is over 21 years of age; and if the Purchaser is an unincorporated association,
all of its members are of such age.


 


(ii)If
the Purchaser is a corporation, partnership, employee benefit plan or IRA, the Purchaser was either:


 


(a)not
formed for the purpose of investing in the Securities, has or will have other substantial business or investments, and is (please
check one):


 





	 	________	 	an
    employee benefit plan within the meaning of Title I of the Employee Retirement Income Security Act of 1974, provided that the
    investment decision is made by a plan fiduciary, as defined in section 3(21) of such Act, and the plan fiduciary is a bank,
    savings and loan association, insurance company or registered investment adviser; or
	 	 	 	 
	 	________	 	an employee benefit plan within the meaning of Title I of the Employee Retirement Income Security Act of 1974 that has total assets in excess of $5,000,000; or
	 	 	 	 
	 	________	 	each of its shareholders, partners, or beneficiaries is an Accredited Investor; or
	 	 	 	 
	 	________	 	the plan is a self-directed employee benefit plan and the investment decision is made solely by a person that is an Accredited Investor; or a corporation, a partnership, or a Massachusetts or similar business trust with total assets in excess of $5,000,000.







 




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(b)formed
for the specific purpose of investing in the Securities, and is an Accredited Investor because each of its shareholders or beneficiaries
is an Accredited Investor.


 


 (iii) If
the Purchaser is a Trust, the Purchaser was either:




 


(a)not
formed for the specific purpose of investing in the Securities, and is an Accredited Investor because (please check one):


 


	 	 ________	 	the
    trust has total assets in excess of $5,000,000 and the investment decision has been made by a “sophisticated person”;
    or
	 	 	 	 
	 	________ 	 	the
    trustee making the investment decision on its behalf is a bank (as defined in Section 3(a)(2) of the Act), a saving and loan
    association or other institution as defined in Section 3(a)(5)(A) of the Securities Act, acting in its fiduciary capacity;
    or
	 	 	 	 
	 	________ 	 	the
    undersigned trustee certifies that the trust is an Accredited Investor because the granter(s) of the trust may revoke the
    trust at any time and regain title to the trust assets and has (have) retained sole investment control over the assets of
    the trust and the (each) grantor(s) is an Accredited Investor; or
	 	 	 	 
	 	________ 	 	the
    undersigned trustee certifies that the trust is an Accredited Investor because all of the beneficial owners of the trust are
    Accredited Investors.




 


(b)formed
for the specific purpose of investing in the Securities, and the undersigned trustee certifies that the trust is an Accredited
Investor because the granter(s) of the trust may revoke the trust at any time and regain title to the trust assets and has (have)
retained sole investment control over the assets of the trust and the (each) grantor(s) is an Accredited Investor.


 


i)
Purchaser Authorization. The Purchaser, if not an individual, is empowered and duly authorized to enter into this Agreement
under any governing document, partnership agreement, trust instrument, pension plan, charter, certificate of incorporation, bylaw
provision or the like; this Agreement constitutes a valid and binding agreement of the Purchaser enforceable against the Purchaser
in accordance with its terms; and the person signing this Agreement on behalf of the Purchaser is empowered and duly authorized
to do so by the governing document or trust instrument, pension plan, charter, certificate of incorporation, bylaw provision,
board of directors or stockholder resolution, or the like.


 




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j) No
Backup Withholding. The Social Security Number or taxpayer identification shown in this Agreement is correct, and
the Purchaser is not subject to backup withholding because (i) the Purchaser has not been notified that he or she is subject
to backup withholding as a result of a failure to report all interest and dividends or (ii) the Internal Revenue Service has
notified the Purchaser that he or she is no longer subject to backup withholding.


 


k)
Investor Questionnaire. The Purchaser has accurately completed the Investor Questionnaire attached hereto as Exhibit
A and incorporated by reference herein.


 


4.REPRESENTATIONS,WARRANTIESANDAGREEMENTSBY
COMPANY: The Company hereby represents, warrants and agrees as follows:


 


a)Authority
of Company. The Company has all requisite authority to execute and deliver this Agreement and to carry out and perform its
obligations under the terms of this Agreement.


 


b)Authorization.
All actions on the part of the Company necessary for the authorization, execution, delivery and performance of this Agreement
by the Company and the performance of the Company’s obligations hereunder has been taken or will be taken prior to the issuance
of the Securities. This Agreement, when executed and delivered by the Company, shall constitute valid and binding obligations
of the Company enforceable in accordance with their terms, subject to laws of general application relating to bankruptcy, insolvency,
the relief of debtors and, with respect to rights to indemnity, subject to federal and state securities laws. The issuance of
the Securities will be validly issued, fully paid and nonassessable , will not violate any preemptive rights, rights of first
refusal, or any other rights granted by the Company, and will be issued in compliance with all applicable federal and state securities
laws, and will be free of any liens or encumbrances, other than any liens or encumbrances created by or imposed upon the Purchaser
through no action of the Company; provided, however, that the Securities may be subject to restrictions on transfer under state
and/or federal securities laws as set forth herein or as otherwise required by such laws at the time the transfer is proposed.


 


c)Governmental
Consents. All consents, approvals, orders, or authorizations of, or registrations, qualifications, designations, declarations,
or filings with, any governmental authority required on the part of the Company in connection with the valid execution and delivery
of this Agreement, the offer, sale or issuance of the Securities, or the consummation of any other transaction contemplated hereby
shall have been obtained, except for notices required or permitted to be filed with certain state and federal securities commissions,
which notices will be filed on a timely basis.


 




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5.INDEMNIFICATION:
The Purchaser hereby agrees to indemnify and defend the Company and its officers and directors and hold them harmless from and
against any and all liability, damage, cost or expense incurred on account of or arising out of:


 


(a)Any
breach of or inaccuracy in the Purchaser’s representations, warranties or agreements herein;


 


(b)Any
disposition of any Securities contrary to any of the Purchaser’s representations, warranties or agreements herein;


 


(c)Any
action, suit or proceeding based on (i) a claim that any of said representations, warranties or agreements were inaccurate or
misleading or otherwise cause for obtaining damages or redress from the Company or any director or officer of the Company under
the Act, or (ii) any disposition of any Securities.


 


 6. MISCELLANEOUS:




 


a)Binding
Agreement. The terms and conditions of this Agreement shall inure to the benefit of and be binding upon the respective successors
and assigns of the Parties. Nothing in this Agreement, expressed or implied, is intended to confer upon any third party any rights,
remedies, obligations, or liabilities under or by reason of this Agreement, except as expressly provided in this Agreement.


 


b)Governing
Law; Venue. This Agreement shall be governed by and construed under the laws of the State of California as applied to agreements
among California residents, made and to be performed entirely within the State of California. The Parties agree that any action
brought to enforce the terms of this Agreement will be brought in the appropriate federal or state court having jurisdiction over
Los Angeles County, California, United States of America.


 


c)Counterparts.
This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together
shall constitute one and the same instrument.


 


d)Titles
and Subtitles. The titles and subtitles used in this Agreement are used for convenience only and are not to be considered
in construing or interpreting this Agreement.


 


e)Notices. All
notices required or permitted hereunder shall be in writing and shall be deemed effectively given: (a) upon personal
delivery to the Party to be notified, (b) when sent by confirmed facsimile if sent during normal busfoess hours of the
recipient, if not, then on the next business day, or (c) one (1) day after deposit with a nationally recognized overnight
courier, specifying next day delivery, with written verification of receipt. All communications shall be sent as follows:


 


	 	If
    to     the Company:	Blow
    & Drive Interlock Corporation


1080
La Cienega Boulevard


Suite 304


Los
Angeles, California 90035


Attn. Laurence Wainer, CEO


Facsimile
L_)___ 


 




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	 	with a copy to:



	Law Offices of Craig V.
Butler



300
Spectrum Center Drive, Suite 300


Irvine,
CA 92618


Attn:
Craig V. Butler, Esq.

Facsimile (949) 209-2545


 


	 	If
    to     Purchaser:	David
    Stuart Petlak 


1152
Beverwil Dr


L.A.
C.A. 90035

Facsimile (424)362-4990


 


or
at such other address as the Company or Purchaser may designate by ten (10) days advance written notice to the other Party hereto.


 


f)
Modification; Waiver. No modification or waiver of any provision of this Agreement or consent to departure therefrom shall
be effective unless in writing and approved by the Company and the Purchaser.


 


g)Entire
Agreement; Successors. This Agreement and the Exhibits hereto constitute the full and entire understanding and
agreement between the Parties with regard to the subjects hereof and no Party shall be liable or bound to the other Party in
any manner by any representations, warranties, covenants and agreements except as specifically set forth herein. The
representations, warranties and agreements contained in this Agreement shall be binding on the Purchaser’s successors,
assigns, heirs and legal representatives and shall inure to the benefit of the respective successors and assigns of the
Company and its directors and officers.


 


h)Expenses. Each Party shall pay their own expenses in connection with this Agreement. In addition, should either Party commence
any action, suit or proceeding to enforce this Agreement or any term or provision hereof, then in addition to any other
damages or awards that may be granted to the prevailing Party, the prevailing Party shall be entitled to have and recover
from the other Party such prevailing Party’s reasonable attorneys’ fees and costs incurred in
connection therewith.


 


 i) Currency. All
currency is expressed in U.S. dollars.


 






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IN
WITNESS WHEREOF, the Parties have executed this Securities Purchase Agreement as of the date first written above.


 


 


 



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