Document:

Unassociated Document

Exhibit 10.6

SUBSCRIPTION AGREEMENT

Players Network

1771 East Flamingo Road suite 201A

Las Vegas, Nevada 89119

Gentlemen:

The undersigned understands that Players Network, a Nevada corporation (the "Company"), is offering for sale shares of its common stock, par value $0.001 per share ("Shares") on the terms and conditions set forth in this Subscription Agreement.  The undersigned further understands that the offer and sale of the Shares being made without registration under the Securities Act of 1933, as amended (the "Securities Act").

1. 1.1           Authorization.  On or prior to the Closing, the Company shall have authorized: (a) the sale and issuance to the Purchaser of the Shares (the “Securities).

 

2. 1.2           Sale and Issuance.  Subject to the terms and conditions set forth in this Agreement, the Purchaser agrees to purchase at the Closing, and the Company agrees to sell and issue to the Purchaser at the Closing, for an aggregate purchase price of Fifteen Thousand Dollars ($15,000), that number of Shares equal to 1,000,000 ($0.015 ) divided by the Closing Price

 

3. 1.3           Acceptance of Subscription and Issuance of the Securities.  It is understood and agreed that the Company shall have the right to accept or reject this subscription in its sole discretion.  Notwithstanding anything in this Agreement to the contrary, the Company shall have no obligation to sell any Securities to any person who is a resident of a jurisdiction in which the sale or issuance of the Securities would constitute a violation of the securities, "blue sky" or other similar laws of such jurisdiction (collectively referred to as the "State Securities laws").

 

4. 1.4           Payment for the Securities.  At the Closing the Company shall deliver to the Purchaser a certificate or certificates, registered in the name of the Purchaser as set forth in Schedule 2.4, representing the shares of Common Stock and a certificate, substantially in the form of Exhibit A, representing the Warrant that the Purchaser is purchasing, against the purchase price therefor.

 

1. 5.     Representations and Warranties of the Company.  The Company represents and warrants that:

 

a. (a)           Organization, Good Standing and Qualification.  The Company is a corporation duly organized, validly existing and in good standing under the laws of the State of Nevada and

 

  

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b. has all requisite corporate power and authority to own and operate its properties and to carry on its business as now conducted and as proposed to be conducted.  The Company is duly qualified to transact business and is in good standing in each jurisdiction in which qualification is required, except where the failure to so qualify, individually or in the aggregate, would not have a Material Adverse Effect.

 

c. (b)           Capitalization.  The authorized capital of the Company consists, or will consist immediately prior to the Initial Closing, of (a) 25,000,000 shares of Preferred Stock, par value $0.001 (the "Preferred Stock"), of which (i) 2,000,000 shares have been designated Series A Preferred Stock, and (ii) 8,600,000 shares have been designated Series B Preferred Stock, none of which are outstanding and (b) 650,000,000 shares of common stock, par value $0.001 ("Common Stock"), of which approximately 94,500,000 shares are issued and outstanding.  No Person has any right of first refusal, preemptive right, right of participation, or any similar right to participate in the transactions contemplated by the Transaction Documents.  As of the Initial Closing Date, except as a result of the purchase and sale of the Securities and for stock options issued by the Company to its employees, directors and consultants, there are no outstanding options, warrants, script rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities, rights or obligations convertible into or exchangeable for, or giving any Person any right to subscribe for or acquire, any shares of Common Stock, or contracts, commitments, understandings or arrangements by which the Company is or may become bound to issue additional shares of Common Stock or securities convertible into or exercisable for shares of Common Stock. All of the outstanding shares of capital stock of the Company are validly issued, fully paid and non-assessable, have been issued in compliance with all U.S. federal and state securities laws, and none of such outstanding shares was issued in violation of any preemptive rights or similar rights to subscribe for or purchase securities.

 

d. (c)           SEC Reports; Financial Statements.  The Company has filed all required SEC Reports for the two years preceding the Initial Closing Date (or such shorter period as the Company was required by law to file such material).  As of their respective dates, the SEC Reports complied in all material respects with the requirements of the Securities Act and the Exchange Act and the rules and regulations of the SEC promulgated thereunder, as applicable, and none of the SEC Reports, when filed, contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading.  The financial statements of the Company included in the SEC Reports comply in all material respects with applicable accounting requirements and the rules and regulations of the SEC with respect thereto as in effect at the time of filing.  Such financial statements have been prepared in accordance with GAAP, except as may be otherwise specified in such financial statements or the notes thereto and except that unaudited financial statements may not contain all footnotes required by GAAP, and fairly present in all material respects the financial position of the Company and its consolidated Subsidiaries as of and for the dates thereof and the results of operations and cash flows for the periods then ended, subject, in the case of unaudited statements, to normal, immaterial, year-end audit adjustments.

 

  

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e. (d)           Authorization.  The Company has all requisite power and authority to execute, deliver and perform its obligations under the Transaction Documents.  All corporate action on the part of the Company and its officers, directors and stockholders necessary for the authorization, execution and delivery of the Transaction Documents and the performance of all obligations of the Company hereunder and thereunder, and the authorization, issuance, sale and delivery of the Shares and the Warrants pursuant to this Agreement, and the Warrant Shares pursuant to the Warrants, has been taken or will be taken prior to the Closing.  The Transaction Documents have been duly executed and delivered by the Company, and assuming that they have been duly executed and delivered by any party thereto other than the Company or its affiliates, constitute valid and legally binding obligations of the Company, enforceable against the Company in accordance with their respective terms, except (a) as limited by applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application affecting enforcement of creditors’ rights generally, (b) as limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies, limited by applicable federal or state securities laws or the public policy underlying such laws.  The sale of the Shares and the sale of the Warrants and the issuance of the Warrant Shares are not and will not be subject to any preemptive rights or rights of first refusal that have not been properly waived or complied with.

 

f. (e)           Valid Issuance of Shares and Warrant Shares.  The Shares and Warrant Shares have been duly authorized and, when issued, sold and delivered in accordance with the terms of this Agreement for the consideration set forth herein, and with respect to the Warrant Shares, when issued, sold and delivered in accordance with the terms of this Agreement and the Warrants for the consideration set forth in the Warrants will be duly and validly issued, fully paid, and nonassessable and free of all Liens and restrictions on transfer other than the restrictions on transfer contained in this Agreement, and under applicable state and federal securities laws.  No further approval of the security holders or the Board of Directors of the Company will be required for the issuance and sale of the Securities and the Warrant Shares to be sold as contemplated herein and in the Warrants, respectively.

 

g. (f)           Offering.  Subject in part to the truth and accuracy of the Purchaser’s representations set forth in this Agreement, the offer, sale and issuance of the Shares, the Warrants, the Warrant Shares and the Conversion Shares will be exempt from the registration requirements of the Securities Act, and are exempt from registration and qualification under the registration, permit or qualification requirements of all applicable securities laws of any state of the United States.

 

h. 

 

i. 

 

  

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j. (g)           Material Changes.  Since the date of the latest audited financial statements included within the SEC Reports, except as disclosed in the SEC Reports, (a) there has been no event, occurrence or development that has had or that would reasonably be expected to result in a Material Adverse Effect, (b) the Company has not incurred any liabilities (contingent or otherwise) other than (i) trade payables and accrued expenses incurred in the ordinary course of business consistent with past practice and (ii) liabilities not required to be reflected in the Company’s financial statements pursuant to GAAP or required to be disclosed in filings made with the SEC, (c) the Company has not altered its method of accounting, (d) the Company has not declared or made any dividend or distribution of cash or other property to its stockholders or purchased, redeemed or made any agreements to purchase or redeem any shares of its capital stock and (e) the Company has not issued any equity securities to any officer, director or Affiliate, except pursuant to existing Company equity incentive plans.  The Company does not have pending before the SEC any request for confidential treatment of information.

 

a. (h)           Litigation.  There is no action, suit, inquiry, notice of violation, proceeding or investigation pending or, to the knowledge of the Company, threatened against or affecting the Company, any of its directors, officers or employees or any of its properties before or by any court, arbitrator, governmental or administrative agency or regulatory authority (federal, state, county, local or foreign) (collectively, an “Action”), which (a) adversely affects or challenges the legality, validity or enforceability of any of the Transaction Documents or the Securities or the transactions contemplated by the Transaction Documents, or (b) would, if there were an unfavorable decision, have or reasonably be expected to result in, individually or in the aggregate, a Material Adverse Effect.

 

b. (i)           Compliance.  The Company (a) is not in default under or in violation of (and, to the Company’s knowledge, no event has occurred that has not been waived that, with notice or lapse of time or both, would result in a default by the Company under), nor has the Company received written notice of a claim that it is in default under or that it is in violation of, any indenture, loan or credit agreement or any other similar agreement or instrument to which it is a party or by which it or any of its properties is bound (whether or not such default or violation has been waived) or any material contract filed by the Company with the SEC pursuant to the Securities Act, the Exchange Act or the rules and regulations promulgated thereunder, (b) is in violation of any order of any court, arbitrator or governmental body applicable to the Company, (c) is or has been in violation of any statute, rule or regulation of any governmental authority applicable to the Company, including without limitation all foreign, federal, state and local laws applicable to its business, or (d) is in violation of or default under its Articles of Incorporation or Bylaws, except in each of the cases referenced in clauses (a), (b) and (c) above as would not, individually or in the aggregate, have or be reasonably expected to have a Material Adverse Effect.

 

c. 

 

d. 

 

  

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e. (j)           Title to Assets.  The Company has good and marketable title in fee simple to all real property owned by it that is material to the business of the Company and good and marketable title in all personal property owned by it that is material to the business of the Company, in each case free and clear of all Liens, except for Liens as do not materially affect the value of such property and do not materially interfere with the use made and proposed to be made of such property by the Company and Liens for the payment of federal, state or other taxes, the payment of which is neither delinquent nor subject to penalties.  Any real property and facilities held under lease by the Company are held under valid, subsisting and enforceable leases of which the Company is in compliance.

 

f. (k)           Patents and Trademarks.  The Company owns, or has rights to use, all patents, patent applications, trademarks, trademark applications, service marks, trade names, copyrights, licenses and other similar rights that are necessary or material for use in connection with its business as described in the SEC Reports and which the failure to so have would, individually or in the aggregate, have a Material Adverse Effect (collectively, the “Intellectual Property Rights”).  The Company has not received a written notice that the Intellectual Property Rights used by the Company violates or infringes upon the rights of any Person. To the knowledge of the Company, all such Intellectual Property Rights are enforceable and there is no existing infringement by another Person of any of the Intellectual Property Rights of the Company.

 

g. (l)           Regulatory Permits.  The Company possesses all certificates, authorizations and permits issued by the appropriate federal, state, local or foreign regulatory authorities necessary to conduct its business as described in the SEC Reports, except where the failure to possess such permits would not, individually or in the aggregate, have or reasonably be expected to result in a Material Adverse Effect (“Material Permits”), and the Company has not received any written notice of proceedings relating to the revocation or modification of any Material Permit.

 

h. (m)           Transactions with Affiliates and Employees.  Except as set forth in the SEC Reports, none of the officers or directors of the Company and, to the knowledge of the Company, none of the employees of the Company, is presently a party to any transaction with the Company or any Subsidiary (other than for services as employees, officers and directors), including any contract, agreement or other arrangement providing for the furnishing of services to or by, providing for rental of real or personal property to or from, or otherwise requiring payments to or from any officer, director or such employee or, to the knowledge of the Company, any entity in which any officer, director, or any such employee has a substantial interest or is an officer, director, trustee or partner, in each case in excess of $120,000 other than (a) for payment of salary or consulting fees for services rendered, (b) reimbursement for expenses incurred on behalf of the Company and (c) for other employee benefits, including stock option agreements under any equity incentive plan of the Company.

 

  

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i. (n)           Sarbanes-Oxley; Internal Accounting Controls.  The Company is in material compliance with all provisions of the Sarbanes-Oxley Act of 2002 which are applicable to it as of the Initial Closing Date.  The Company maintains a system of internal accounting controls sufficient to provide reasonable assurance that (a) transactions are executed in accordance with management’s general or specific authorizations, (b) transactions are recorded as necessary to permit preparation of financial statements in conformity with GAAP and to maintain asset accountability, (c) access to assets is permitted only in accordance with management’s general or specific authorization, and (d) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences.  The Company has established disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the Company and designed such disclosure controls and procedures to ensure that material information relating to the Company is made known to the certifying officers by others within those entities, particularly during the period in which the Company’s most recently filed periodic report under the Exchange Act, as the case may be, is being prepared.  The Company’s certifying officers have evaluated the effectiveness of the Company’s controls and procedures as of the date prior to the filing date of the most recently filed periodic report under the Exchange Act (such date, the “Evaluation Date”).  The Company presented in its most recently filed periodic report under the Exchange Act the conclusions of the certifying officers about the effectiveness of the disclosure controls and procedures based on their evaluations as of the Evaluation Date.  Since the Evaluation Date, there have been no significant changes in the Company’s internal controls (as such term is defined in Item 307(b) of Regulation S-K under the Exchange Act) or, to the Company’s knowledge, in other factors that could materially affect the Company’s internal controls.

 

j. (o)           Disclosure.  The Company has provided the Purchaser with all the information that the Purchaser has requested for deciding whether to purchase the Series B Preferred Stock.

 

k. (p)           Registration Rights.  Except as provided in the Investor’s Rights Agreement the Company has not granted or agreed to grant any registration rights, including piggyback rights, to any person or entity.

 

l. (q)           Corporate Documents.  Except for amendments necessary to satisfy representations and warranties or conditions contained herein (the form of which amendments has been approved by the Purchaser), the Articles of Incorporation and Bylaws of the Company are in the form previously provided to the Purchaser and accurately reflects in all material respects all actions by the directors (and any committee of directors) and stockholders with respect to all transactions referred.

 

  

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m. (r)           Tax Status.  The Company has made or filed all federal, state and foreign income and all other tax returns, reports and declarations required by any jurisdiction to which it is subject (unless and only to the extent that the Company has set aside on its books provisions reasonably adequate for the payment of all unpaid and unreported taxes) and has paid all taxes and other governmental assessments and charges that are material in amount, shown or determined to be due on such returns, reports and declarations, except those being contested in good faith and has set aside on its books provisions reasonably adequate for the payment of all taxes for periods subsequent to the periods to which such returns, reports or declarations apply.  There are no unpaid taxes in any material amount claimed to be due by the taxing authority of any jurisdiction, and the officers of the Company know of no basis for any such claim.  The Company has not executed a waiver with respect to the statute of limitations relating to the assessment or collection of any foreign, federal, state or local tax.  None of the Company’s tax returns is presently being audited by any taxing authority.

 

n. (s)           Investment Company. The Company is not, and is not an affiliate of, and immediately after receipt of payment for the Securities, will not be or be an affiliate of, an “investment company” within the meaning of the Investment Company Act of 1940, as amended.  The Company shall conduct its business in a manner so that it will not become subject to the Investment Company Act.

 

o. (t)           Insurance.  The Company maintains insurance underwritten by insurers of recognized financial responsibility, of the types and in the amounts that the Company reasonably believes is adequate for its business as currently conducted, including, but not limited to, insurance covering all real and personal property owned or leased by the Company against theft, damage, destruction, acts of vandalism and all other risks customarily insured against, with such deductibles as are customary for companies in the same or similar business, all of which insurance is in full force and effect.

 

p. (u)           Related Party Transactions.  Except as set forth in the SEC Reports, no transaction has occurred between or among the Company, on the one hand, and its affiliates, officers or directors on the other hand.

 

q. (v)           Foreign Corrupt Practices.  Neither the Company, nor, to the knowledge of the Company, any director, officer, agent, employee or other Person acting on behalf of the Company has, in the course of its actions for, or on behalf of, the Company (a) used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful expenses relating to political activity; (b) made any direct or indirect unlawful payment to any foreign or domestic government official or employee from corporate funds; (c) violated or is in violation of any provision of the U.S. Foreign Corrupt Practices Act of 1977, as amended; or (d) made any unlawful bribe, rebate, payoff, influence payment, kickback or other unlawful payment to any foreign or domestic government official or employee.

 

r. (w)                      Full Disclosure.  No representation or warranty of the Company made in this Agreement and the Investor’s Rights Agreement, including any schedules or exhibits hereto or thereto, contains or will contain any untrue statement of a material fact or omits or will omit to state a material fact necessary to make the statements or facts contained herein or therein not misleading.

 

  

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2. 1.6       Representations and Warranties of the Undersigned.  The undersigned hereby represents and warrants to the Company and to each officer, director, controlling person and agent of the Company that:

 

a. (a)           Organization; Validity; Enforcements.  (a) The Purchaser has power, authority and capacity to enter into this Agreement and to consummate the transactions contemplated hereby, (b) the making and performance of this Agreement by the Purchaser and the consummation of the transactions herein and therein contemplated will not violate or conflict with, result in the breach or violation of, or constitute, either by itself or upon notice or the passage of time or both, a default under any material agreement, mortgage, deed of trust, lease, franchise, license, indenture, permit or other instrument to which the Purchaser is a party, or any statute or any authorization, judgment, decree, order, rule or regulation of any court or any regulatory body, administrative agency or other governmental agency or body applicable to the Purchaser, (c) no consent, approval, authorization or other order of any court, regulatory body, administrative agency or other governmental agency or body is required on the part of the Purchaser for the execution and delivery of this Agreement or the consummation of the transactions contemplated by this Agreement, (d) upon the execution and delivery of this Agreement, this Agreement shall constitute a legal, valid and binding obligation of the Purchaser, enforceable in accordance with their terms, except (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application affecting enforcement of creditors’ rights generally, (ii) as limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies, and (d) there is not in effect any order enjoining or restraining the Purchaser from entering into or engaging in any of the transactions contemplated by this Agreement.

 

b. (b)           Purchase Entirely for Own Account.  The Securities are being acquired for investment for the Purchaser’s own account, not as a nominee or agent and not with a view to the resale or distribution of any part thereof.

 

c. (c)           Information. The Purchaser and his advisors, if any, have been furnished with all materials relating to the business, finances and operations of the Company and materials relating to the offer and sale of the Securities which have been requested by the Purchaser. The Purchaser and his advisors, if any, have been afforded the opportunity to ask questions of the Company; provided, however, that neither such inquiries nor any other due diligence investigations conducted by the Purchaser or his representatives shall modify, amend or affect the Purchaser’s right to rely on the Company’s representations and warranties contained in Section 3.  The Purchaser has sought such accounting, legal and tax advice as he has considered necessary to make an informed investment decision with respect to his acquisition of the Securities. The Purchaser understands that he (and not the Company) shall be responsible for his own tax liabilities that may arise as a result of this investment or the transactions contemplated by this Agreement.

 

  

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d. (d)           Investment Experience.  The Purchaser understands that the purchase of the Securities involves substantial risk.  The Purchaser is an investor in securities of companies in the developmental stage and acknowledges that he can bear the economic risk of his investment and has such knowledge and experience in financial or business matters that he is capable of evaluating the merits and risks of its investment in the Securities.  The Purchaser has undertaken an independent analysis of the merits and the risks of an investment in the Securities, based on the Purchaser’s own financial circumstances.

 

e. (e)           No General Solicitation.  The Purchaser acknowledges that he has not seen, received, been presented with, or been solicited by any leaflet, public promotional meeting, newspaper or magazine article or advertisement, radio or television advertisement, or any other form of advertising or general solicitation with respect to the Securities.

 

f. (f)           Accredited Purchaser.  The Purchaser is an “accredited investor” within the meaning of SEC Rule 501 of Regulation D, as presently in effect and Purchaser has executed the Certificate of Accredited Investor Status, attached hereto as Exhibit D.

 

g. (g)           Restricted Securities.  The Purchaser understands that the Securities are characterized as “restricted securities” under the federal securities laws inasmuch as they are being acquired from the Company in a transaction not involving a public offering and that under such laws and applicable regulations such securities may be resold without registration under the Securities Act only in certain limited circumstances.  In this connection, the Purchaser represents that he is familiar with SEC Rule 144, as presently in effect, and understands the resale limitations imposed thereby.  The Purchaser will not, directly or indirectly, offer, sell, pledge, transfer or otherwise dispose of (or solicit any offers to buy, purchase or otherwise acquire or take a pledge of) any of the Securities, nor will the Purchaser engage in any short sale that results in a disposition of any of the Securities by the Purchaser, except in compliance with the Securities Act and the rules and regulations promulgated thereunder and any applicable state securities law.

 

h. (h)           Consultation With Own Attorney.  The Purchaser has been advised to consult with his own attorney or attorneys regarding all legal matters concerning an investment in the Company and the tax consequences of purchasing the Securities, and has done so, to the extent Purchaser considers necessary.

 

i. (i)           Tax Consequences.  The Purchaser acknowledges that the tax consequences of investing in the Company will depend on particular circumstances, and neither the Company, the Company’s officers, any other investors, nor the partners, shareholders, members, managers, agents, officers, directors, employees, affiliates or consultants of any of them, will be responsible or liable for the tax consequences to Purchaser of an investment in the Company.  The Purchaser will look solely to and rely upon his own advisers with respect to the tax consequences of this investment.

 

  

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j. (j)           Information Provided by Purchaser.  All information which the Purchaser has provided to the Company concerning the Purchaser, his financial position and his knowledge of financial and business matters, and any information found in the Certificate of Accredited Investor Status, is truthful, accurate, correct, and complete as of the date set forth herein or therein

 

a. k.   Legends.  The Purchaser understands that, at all times until such time as (a) a registration statement registering the Shares and the Warrant Shares has been declared effective or (b) the Shares and Warrant Shares may be sold pursuant to Rule 144 under the Securities Act without any restriction as to the number of securities as of a particular date that can then be immediately sold, the Shares and the Warrant Shares will bear a restrictive legend in substantially the following form:

 

“NEITHER THESE SECURITIES NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE CONVERTIBLE OR EXERCISABLE HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED.  THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF A REGISTRATION STATEMENT IN EFFECT WITH RESPECT TO THE SECURITIES UNDER SUCH ACT OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED UNDER SUCH ACT OR APPLICABLE STATE SECURITIES LAWS OR UNLESS SOLD PURSUANT TO RULE 144 OF SUCH ACT.”

 

a. (l)           Reliance on Exemptions.  The Purchaser understands that the Securities are being offered and sold to him in reliance upon specific exemptions from the registration requirements of the Securities Act, the rules and regulations promulgated thereunder and state securities laws and that the Company is relying upon the truth and accuracy of, and the Purchaser’s compliance with, the representations, warranties, agreements, acknowledgments and understandings of the Purchaser set forth herein in order to determine the availability of such exemptions and the eligibility of the Purchaser to acquire the Securities.

 

b. (m)         No Government Review.  The Purchaser understands that no United States federal or state agency or any other government or governmental agency has passed upon or made any recommendation or endorsement of the Securities.

 

2. 1.7       Waiver, Amendment.  Neither this Agreement nor any provisions hereof shall be modified, changed, discharged or terminated except by an instrument in writing signed by the party against whom any waiver, change, discharge or termination is sought.

 

3. 1.8       Assignability.  Neither this Agreement nor any right, remedy, obligation or liability arising hereunder or by reason hereof shall be assignable by either the Company or the undersigned without the prior written consent of the other party.

 

4. 1.9       Applicable Law.  THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEVADA, REGARDLESS OF THE LAW THAT MIGHT BE APPLIED UNDER PRINCIPLES OF CONFLICTS OF LAW.

 

  

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5. 

 

6. 

 

7. 1.10                  Section and Other Headings.  The section and other headings contained in this Agreement are for reference purposes only and shall not affect the meaning or interpretation of this Agreement.

 

8. 

 

9. 1.11                  Counterparts.  This Agreement may be executed in any number of counterparts, each of which when so executed and delivered shall be deemed to be an original and all of which together shall be deemed to be one and the same agreement.

 

10. 1.12                  Notices.  All notices and other communications provided for herein shall be in writing and shall be deemed to have been duly given if delivered personally or sent by registered or certified mail, return receipt requested, postage prepaid:

 

a. 

 

b. (a)           If to the Company, to it at the following address:

 

Players Network

1771 East Flamingo Rd 201A

Las Vegas, Nevada 89119

Attention:  CEO

a. (b)           If to the undersigned, to him at the address set forth on the signature page hereto; or at such other address as either party shall have specified by notice in writing to the other.

 

2. 1.13                  Binding Effect.  The provisions of this Agreement shall be binding upon and accrue to the benefit of the parties hereto and their respective heirs, legal representatives, successors and assigns.

 

3. 1.14                  Indemnification.  The undersigned acknowledges that he understands the meaning and legal consequences of the representations, warranties, and covenants set forth herein and that the Company has relied and will rely upon such representations, warranties and covenants.  Therefore, he hereby agrees to indemnify and hold harmless the Company and the officers, directors, controlling persons and agents of the Company from and against any and all loss, claim,

 

4. 

 

  

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5. damage, liability or expense, and any action in respect thereof, joint or several, to which any such person may become subject, due to or arising out a breach of any such representation, warranty, or covenant, together with all reasonable costs and expenses (including attorneys' fees) incurred by any such person in connection with any action, suit, proceeding, demand, assessment, or judgment incident to any of the matters so indemnified against.  Notwithstanding the foregoing, however, no representation, warranty, acknowledgment, or agreement made herein by the undersigned shall in any manner be deemed to constitute a waiver of any rights granted to him under federal or state securities laws.

 

6. 

 

7. 1.15                  Survival.  All representations, warranties and covenants contained in this Agreement and the indemnification contained in Section 1.14 shall survive (i) the acceptance of the subscription by the Company and (ii) the death or disability of the undersigned.

 

8. 1.16                  Notification of Changes.  The undersigned hereby covenants and agrees to notify the Company upon the occurrence of any event prior to the closing of the purchase of the Securities pursuant to this Agreement that would cause any representation, warranty, or covenant of the undersigned contained in this Agreement to be false or incorrect.

 

IN WITNESS WHEREOF, the undersigned has executed this Subscription

Agreement this _____ day of ______________________, 2013

_________________________________

Signature

 

 

_________________________________

Print Name

_________________________________

Number and Street

_________________________________

City, State and Zip

________________________________

                                                                             

SS# or Tax ID

Accepted as of

______________________ _____, 2013

  

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Accredited Investor Certification

Please check response A or B as appropriate:

_____   A.           I am not an accredited investor.

	
  

	
_____

	
B.

	
I am an accredited investor because I am (please check the appropriate response):

	
  

	
_____

	
I have an individual net worth (or joint net worth with spouse) in excess of $1,000,000; or

	
  

	
_____

	
I had an individual income (not including any amounts attributable to spouse or to property owned by spouse) of more than $200,000 in each of the previous two calendar years and a reasonable expectation to reach the same income level in the current year; or I had a joint income with spouse in excess of $300,000 in each of the previous two calendar years and a reasonable expectation to reach the same income level in the current year; or

	
  

	
_____

	
I am a bank or savings and loan association, whether acting in its individual or fiduciary capacity; or

	
  

	
_____

	
I am a broker-dealer registered pursuant to Section 15 of the Securities Exchange Act of 1934; or

	
  

	
_____

	
I am an insurance company; or

_____                      I am an investment company registered under the Investment Company Act of 1940, as amended, or a business development company as defined in said Act; or

	
  

	
_____

	
I am a Small Business Investment Company licensed by the U.S. Small Business Administration; or

	
  

	
_____

	
I am a plan established and maintained by a state, its political subdivisions or any agency or instrumentality thereof, for the benefit of its employees, if such plan has total assets in excess of $5,000,000; or

	
  

	
_____

	
I am an employee benefit plan within the meaning of Title I of the Employment Retirement Income Security Act of 1974 (“ERISA”), if the investment decision with respect to this investment is made by a plan fiduciary which is either a bank, savings and loan association, insurance company or registered investment advisor, or if the employee benefit plan has total assets in excess of $5,000,000, or if a self-directed plan, its investment decisions are made solely by persons who are accredited investors; or

	
  

	
_____

	
I am a private business development company as defined in the Investment Advisors Act of 1940, as amended; or

	
  

	
_____

	
I am a corporation, Massachusetts or similar business trust or partnership, or any tax exempt organization as defined in Section 501(c)(3) of the Internal Revenue Code, not formed for the specific purpose of acquiring Investor Securities, with the total assets in excess of $5,000,000; or

	
  

	
_____

	
I am a trust with total assets in excess of $5,000,000, not formed for the specific purpose of acquiring Investor Securities, whose purchase is directed.

IN WITNESS WHEREOF, the undersigned has executed this Accredited Investor

Certification this _____ day of ______________________, 2013

_________________________________

Signature

_________________________________

Print NameMantra Venutre Group Ltd. - Exhibit 10.1- Filed by newsfilecorp.com

FRAMEWORK 
AGREEMENT

between 

ALSTOM (Switzerland) Ltd. 
Brown Boveri Str. 7

5401 Baden 
Switzerland 

hereinafter referred to as “Alstom” 

and 

Mantra Energy Alternatives Ltd 
4-2119
152nd Street South 
Surrey, BC V4A 4N7 
Canada 

hereinafter referred to as “Mantra” 

both parties hereinafter referred to individually as a
“Party” or collectively as “Parties” 

concerning 

 

	Mantra Alstom Framework Agreement 8-K Exhibit 10.1 Blacked
      Out Version 	1

This Framework Agreement, together with its Appendixes and
Addendums attached hereto, (the “Agreement”) is
entered into by and among Mantra and Alstom as of [Month]
[Day]st, 2013 (the “Effective Date”), 

RECITALS: 

WHEREAS, Alstom has expertise, capabilities,
technologies and patent applications with the respect to the development of
manufacture of industrial products, systems, equipment and services in
connection with the capture and utilization of carbon dioxide in power
generation and industrial setting, including the conversion of CO2 to
chemical products.

WHEREAS, Mantra owns Intellectual Property related to the
electrochemical conversion of carbon dioxide to chemical products, and has the
foundation of knowledge and the internal and external expertise and know-how
necessary to develop new CO2 conversion processes.

NOW, THEREFORE, in consideration of the promises and
undertakings set forth herein, the Parties agree as follows: 

	1. 	
      Definitions

	 	 
	1.1 	
      “Affiliate” shall mean any entity that is
      controlled by, controls, or is under common control with Mantra or Alstom,
      as the case may be. For this definition, control shall mean (a) direct or
      indirect ownership of more than fifty per cent (50%) interest in the
      income of the entity in question; provided, however, that is local law
      requires a minimum percentage of local ownership, control shall be
      established by direct or indirect beneficial ownership of one hundred
      (100%) of the maximum ownership percentage that may, under such local law,
      be owned by foreign interests; (b) possession, directly or indirectly, of
      the power to direct or cause the direction of management or policies of
      the entity in question (whether through ownership of securities or other
      ownership interests, by contract or otherwise); or (c) any other
      relationship that, in fact, constitutes actual control.

	 	 
	1.2 	
      “Approved Subcontractors” means Third Party
      service providers and subcontractors under a contract or similar agreement
      with a Party and/or its Affiliates in furtherance of or to assist a Party
      (and such Party’s Affiliates, as appropriate) in analytic, research,
      diagnostic, pilot, demonstrative and validation purpose or studies in such
      Party’s performance of the Pilot Project.

	 	 
	1.3 	
      “Background IPR” means any invention, design,
      technology, know-how, patent or any other IPR (i) which was owned by a
      Party and/or by an Affiliate of such Party as of the effective date this
      Agreement, or (ii) which is developed or created by a Party or an
      Affiliate of such Party after the effective date of this Agreement
      provided it is not developed by a Party directly in association with the
      Project, or (iii) which is acquired from a third party before or after the
      effective date of this Agreement.

	1.4 	
      “Confidential Information” means information and
      material disclosed by or on behalf of one Party and/or its Affiliates (the
      “Discloser”) to the other Party and/or its Affiliates (the
      “Recipient”) after this Agreement is entered into, of whatsoever
      nature (whether oral, written, magnetic, electronic, graphic, digitised or
      in any other form) and howsoever stored (including in hard copy,
      electronically or otherwise), provided that written information or
      material is clearly marked in a conspicuous place as “Confidential” or
      “Proprietary” (or words of similar import) and an oral information is
      within thirty (30) days of such oral disclosure confirmed in writing as
      confidential or proprietary, containing or consisting of information or
      material of a technical, financial, operational commercial,
      administrative, legal or planning nature or in the nature of intellectual
      property of any kind, and relating (wholly or in part) to this Agreement
      and/or the Project,

	 	 
	1.5 	
      “Foreground IPR” means any invention, design,
      technology, know-how, patent or any other IPR developed by a Party and/or
      its Affiliates during the term of the Project, limited to the extent,
      however, it has been developed directly as a result of the Project. For
      the avoidance of doubt, Foreground IPR does not include any Third Party
      IPR except for a Party’s Affiliates, and Approved Subcontractors
      performing work under a Project. .

	 	 
	1.6 	
      “FTE” means the efforts of one or more employees
      of a particular Party and/or its Affiliates (or employees of Approved
      Subcontractors), equivalent to the efforts of one full time employee
      (i.e., and employee that works at least one thousand seven hundred sixty
      (1760) hours per year) for such Party.

	 	 
	1.7 	
      “Intellectual Property Rights” or “IPR” means any
      intellectual and industrial property rights including, without limitation,
      patents, designs, utility models, copyright, database rights, trade marks,
      rights in know-how, trade secrets and confidential information and any
      other rights of similar or equivalent effect anywhere in the world.1.8
      “Joint Results” means Results jointly owned by the Parties, as the
      case may be according to the Special Terms and Conditions of a
    Project.

	 	 
	1.9 	
      “Party” means either Mantra or
  Alstom.

		
      between Mantra and Alstom associated with the development
      of technologies and processes for the conversion of CO2 to
      chemical products, and determine the feasibility of manufacture and
      commercialization of products and equipment for the conversion of CO2
      to chemical products for sale to Third Parties, all on the terms and
      conditions set forth in this Agreement. 

	 	     
	1.11 	
      “Project Results” or “Results” means any
      data or information obtained, or any work product, deliverable, or
      Foreground IPR made, by any Party whether solely or jointly with any other
      Party during the performance of a Project. 

	 	     
	1.12 	
      “Special Terms and Conditions” means the
      Project-specific terms and conditions to be mutually agreed upon by the
      Parties and signed and attached to this Agreement, forming a separate
      Addendum to this Agreement for each Project. 

		     
	1.13 	
      “Third Party” means a party other than Mantra
      and/or ALSTOM and/or any of its Affiliates. 

	1.14 	
      “ERC Technology” means Mantra’s proprietary
      technology for the conversion of CO2 to chemical products, as
      described in Appendix A.

	2 	
      Scope of the Agreement

	 	 
	2.1 	
      Mantra and Alstom agree to co-operate in the Projects
      related to the research and development of ERC Technology. The following
      items shall be defined for every Project in the Special Terms and
      Conditions for such Project:

	 	- 	
      The purpose, aims and objectives of the Project to be
      carried out under the terms of this Agreement (including the anticipated
      Results). 

	 	- 	
      Technical description of the subject matter of Project,
      including clear sub- divisions of work to be carried out. 

	 	-	
      Share and/or allocation of costs. 

	 	-	
      The responsibilities of the Parties with regard to their
      work scope. 

	 	-	
      Both Parties’ contact persons and project managers.
    

	2.2 	
      This Agreement does not establish any obligation to
      perform a specific Project until the Special Terms and Conditions for such
      Project have been agreed upon.

	 	 
	2.3 	
      The Special Terms and Conditions appended hereto will
      include Phases and/or Work Packages for each Project. The commencement of
      each Phase and Work Package shall be at Alstom’s sole option.
      Notwithstanding the inclusion of such Phases and/or Work Packages in the
      Special Terms and Conditions, Mantra shall not commence work on any Phase
      or Work Package without the prior written approval of Alstom, and neither
      party shall have any obligation with respect to any Phase or Work Package
      not approved by Alstom.

	 	 
	2.4 	
      Mantra acknowledges that this Agreement is entered into
      by Alstom on behalf of itself and for the benefit of any Alstom Affiliates
      which may be nominated by Alstom from time to time by written notice to
      Mantra. Mantra agrees to perform its obligations towards Alstom, or
      towards any such nominated Alstom Affiliate. Alstom will cause such
      nominated Affiliates to comply with the provisions of this Agreement, as
      if they were parties hereto.

	3 	
      Performance of the
Parties

	3.1 	
      Each Party undertakes to perform its obligations in
      connection with the Project, on the terms of this Agreement, as amended by
      the Special Terms and Conditions for that Project.

	 	 
	3.1 	
      The Parties shall hold regular meetings (not less than
      once every six months) in order to inform each other on the status of the
      activities covered hereunder.

	4 	
      Confidentiality

	4.1 	
      Recipient agrees to maintain secret and confidential all
      Confidential Information, and to use the same exclusively for the purposes
      of this Agreement, and not to disclose the Confidential Information or
      make it otherwise available to any Third Party other than its employees,
      subcontractors, and licensees (subject to Article 4.3) to whom and to the
      extent that such disclosure is reasonably necessary for the purpose of the
      Projects. Without limiting the generality of the foregoing, the Recipient
      will not use, manufacture, or sell the Discloser’s Confidential
      Information or any device or means incorporating any of the Discloser’s
      Confidential Information, and will not use any of the Discloser’s
      Confidential Information as the basis for the design or creation of any
      device or means except in each of such cases as set out in this
Agreement.

	4.2 	
      The obligations of Article 4 shall not apply to
      Confidential Information that:

	 	- 	
      was in the public domain at the time it was transmitted
      to the Recipient, or 

	 	- 	
      became publicly available for reasons other than as a
      result of a breach of this Agreement, or 

	 	- 	
      was in the Recipient’s possession, without any limitation
      regarding its disclosure at the time it was transmitted to the Recipient,
      or 

	 	- 	
      was independently developed by the Recipient without the
      benefit of the Confidential Information, or 

	 	-	
      was obtained in good faith by the Recipient from a third
      party. 

	4.3 	
      Recipient will, in each case prior to disclosure of
      Discloser’s Confidential Information, contractually impose a
      confidentiality obligation no less restrictive than the confidentiality
      obligation stipulated by this Agreement on:

	 	 	 
		(a) 	
      all of their employees and any consultant working for
      them to whom disclosure of such Confidential Information is necessary for
      the performance of the Project,

	 	 	 
		(b) 	
      their Affiliates or subcontractors contributing to the
      Project and any of their licensees authorized pursuant to Article
  6.

	 	 	 
	4.4 	
      Neither Party will disclose any terms or conditions of
      this Agreement, including the Parties named herein, to any person who is
      not a director, officer, employee or bona fide authorized representative
      of the Party or its Affiliates, without the prior written consent of the
      other Party except:

		 	 
		(a) 	
      if such Party determines, acting reasonably, that
      disclosure is required by Law, the order of a government agency or by a
      court of competent jurisdiction, or during the course of its business or
      the performance of its obligations under this Agreement; and

		 	 
		(b) 	
      if such disclosure is not required by Law it is made
      under terms that restrict further disclosure to the extent necessary to
      protect the interests of the other Party.

	 	 	 
	4.5 	
      Notwithstanding Article 4.4 above, for its commercial
      activities both Parties shall be entitled to provide information to their
      clients on the existence of the scope and objectives of a Project as long
      as such disclosures do not include the Confidential Information.

	 	 	 
	4.6 	
      Neither Party will issue news releases or other public
      announcements without receiving the prior written consent of the other
      Party hereto.

	 	 	 
	4.7 	
      The obligations under this Section 4 shall come into
      force on the date the Agreement is signed by both Parties and shall remain
      effective for a period of five (5) years after: (a) termination of this
      Agreement, or (b) the last Project being performed under this Agreement,
      whichever occurs later.

	5 	
      Intellectual Property Committee, Review, and
      Cooperation

	 	 
		
      Intellectual Property
Committee

	5.1 	
      Formation. Promptly after the Effective Date, the
      Parties shall establish an intellectual property committee to oversee the
      intellectual property activities of the Parties under this Agreement, as
      more specifically provided herein (the “IPC” or the
      “Intellectual Property Committee”). The IPC shall keep the project
      managers of the Parties (the “PMs”) reasonably informed of its progress
      and activities within the Project and each Party shall bear all expenses
      related to their members’ participation on the IPC. The IPC shall perform
      the following:

	 	(i) 	
      discuss and, if appropriate, investigate any issues that
      a Party may raise with respect to the intellectual property rights of any
      Third Party relevant to the activities conducted pursuant to the Project
      and make recommendations to the PMs regarding appropriate actions, if any,
      with respect thereto;

	 	 	 
	 	(ii) 	
      discuss, coordinate and monitor filings made with the
      respective governmental patent office(s), for patent rights relating to
      the Project made during the Term; and

	 	 	 
	 	(iii) 	
      perform such other functions as may be assigned by the
      PMs to further the Project, as may be agreed upon by the
  Parties.

	5.2 	
      Membership. Each Party, in its sole discretion,
      shall appoint two (2) members to the IPC and shall provide written notice
      to each other Party of the names and contact information of all such
      appointed members within ten (10) days after the Effective Date.

	 	 
	5.3 	
      Meetings. The IPC shall meet at least twice
      annually during the Term, in person or via teleconference or video
      conference, as mutually agreed by the IPC members.

	 	 
	5.4 	
      Minutes. The IPC shall keep accurate written
      minutes of its deliberations, which shall be provided to the PMs within
      ten (10) business days after each meeting. .

	 	 
	5.5 	
      Decisions and Dispute Resolution. All decisions of
      the IPC shall be made by unanimous vote, with each Party having one (1)
      vote. If the IPC is unable to resolve any dispute, controversy, or claim
      within thirty (30) days after it first addresses such matter (or such
      longer period as the Parties may mutually agree), then the dispute shall
      be submitted to the PMs for resolution.

	 	 
		
      Review & Cooperation in Patenting
      Activities.

	 	 
	5.6 	
      The Parties will cooperate, through the IPC, in the
      patenting of Results. The Parties shall inform the IPC of all Project
      Results (whether or not patentable or otherwise subject to potential
      protection or registration), obtained by a Party in the course of this
      Agreement by means of reports or publication drafts made to the IPC. In
      addition, each Party will notify the IPC promptly after identifying any
      Result that it believes is patentable, and will supply the IPC with copies
      of that Result.

	 	 
	5.7 	
      No patent application disclosing or claiming Results will
      be filed without notice to the IPC, who in turn will notify the PMs. The
      IPC will be given a copy of the draft patent application prior to the
      planned filing and 10 business days in which to review and comment prior
      to filing. Where necessary to protect the Parties’ respective patent
      rights, the Parties will cooperate to make
patent application filings concurrently (i.e., on the same day). In addition, no patent application will be filed containing the Confidential Information of another Party without the prior written consent of the other Party.

		
Filing, Prosecution and Maintenance of Each Party’s Patent Rights.

	
	 	 
	
5.8 		
Each Party shall have the sole and exclusive right, in such Party’s absolute discretion, but not the obligation, to draft, file, prosecute, maintain and enforce (collectively, “Prosecute”, or
“Prosecution”) all patents and patent applications within each Party’s Results. In the case of Results jointly-owned by the Parties, the Parties shall reasonably cooperate with the others in the registration of IPR in the
Results, where such registration is decided by the IPC, and shall share the cost associated with such registration, such as attorney filing, prosecution, and annuity fees and other reasonable costs associated with such registration.
	
	 	 
	
5.9 		
In case a Party elects to abandon any Intellectual Property Rights arising from Results, including but not limited to patents, such Party shall inform the other Party prior to abandoning such Intellectual Property Rights. Upon
request of the other Party, the first Party shall transfer all rights and title to such Intellectual Property Rights to the other Party. The other Party shall bear all costs related to the transfer and all costs for further maintaining the
Intellectual Property Rights. Upon request of the first Party, the other Party shall grant to the first Party a non-exclusive, royalty-free license to use the Intellectual Property Rights.
	

	
6 		
Intellectual Property and Rights to Project Results

	
	 	 
		
Ownership of Background Intellectual Property Not Affected

	

	
6.1 		
This Agreement does not affect the ownership of any Intellectual Property in any Background IPR or in any other technology, design, work, invention, software, data, technique, Know-how, or materials that are not Project Results.
The Intellectual Property in them will remain the property of the Party that contributes them to the Project (or its licensors). No licence to use any Intellectual Property is granted or implied by this Agreement except the rights expressly granted
in this Agreement.

	
	 	 
	
6.2 		
Each Party shall bring to the attention of the other, in writing, any of its Background IPR and/or Third Party IPR of which it is aware prior to using such in a Project. Appendix 2 includes a listing of Background IPR and/or Third
Party IPR expected to be used in the Project as of the Effective Date.

	
	 	 
		
Licence of Background IPR

	
	 	 
	
6.3 		
Each Party grants the other a royalty-free, non-exclusive licence to use its Background IPR solely for the purpose of carrying out the Project, but for no other purpose. Neither Party may grant any sub-licence to use the other's
Background IPR (except that the ALSTOM may allow ALSTOM Affiliates, and any person working for or on behalf of ALSTOM or any ALSTOM Affiliate, to use the other Party’s Background IPR for the purpose of carrying out the Project).

	

		
      Ownership of Results Under Project

	 	 
	6.4 	
      Results first created in connection with the Project
      described in either Addendum A or Addendum B shall vest in and be owned
      absolutely by the Party first creating it, or shall be jointly owned by
      the Parties if jointly created.

	 	 
		
      License to Alstom Results

	 	 
	6.5 	
      For Project Results owned by Alstom, Alstom grants to
      Mantra a non- exclusive, irrevocable, royalty-free and non-transferable
      right to use the Results to conduct work under this Agreement and for
      internal research and development activities. Mantra shall not be entitled
      to use or sub-license the Results for third party projects except with the
      prior written approval of Alstom. For avoidance of doubt, the license
      granted by Alstom under this Article 6.5 is limited to Alstom’s Project
      Results, which includes Alstom’s Foreground IPR but does not include
      Alstom’s Background IPR.

	 	 
		
      License and Option to Mantra Results

	 	 
	6.6 	
      For Project Results owned by Mantra, Mantra hereby grants
      to Alstom a non- exclusive, royalty-free, fully paid-up commercial license
      with the right to grant sub-licenses. For avoidance of doubt, the license
      granted to Alstom under this Article 6.6 is limited to Mantra’s Project
      Results, which includes Mantra’s Foreground IPR but does not include
      Mantra’s Background IPR.

	 	 
	6.7 	
      The Parties acknowledge that Alstom may desire to acquire
      either or both of (a) an exclusive license to Mantra’s Project
      Results (instead of the non- exclusive license provided in Article 6.6)
      and/or (b) a license to Mantra’s Background IPR reasonably required for
      commercialization of the Project Results (which license is not provided in
      Article 6.3); accordingly, Alstom shall have the right of options to (a)
      the exclusive license of Mantra’s Project Results, and/or (b) a license to
      any Background IPR reasonably required for commercialization of the
      Project Results (“Project-related Background IPR”). On Alstom’s request,
      Mantra shall (a) exclusively license to Alstom (or Alstom Affiliates if so
      designated) the rights in and to any or all such Project Results, and/or
      (b) license to Alstom (or Alstom Affiliates if so designated) the rights
      in and to any or all Project-related Background IPR, each in accordance
      with the following provisions:

	 	(i) 	
      The Parties will, if Alstom gives Mantra written notice
      of the license(s) for which Alstom desires to exercise its option (an
      “Option Notice”) at any time during the period of Three (3) months from
      the expiration or termination of this Agreement (the “Term of the
      Option”), negotiate the terms on which Mantra will exclusively license to
      Alstom Mantra’s Project results and/or license to Alstom any
      Project-related Background IPR identified by Alstom (the “Option
      License”).

	 	 	 
	 	(ii) 	
      Following Mantra’s receipt of an Option Notice, the
      Parties will negotiate in good faith (taking into account the respective
      contribution of the parties), for a period of up to 6 months after the
      date of receipt of the Option Notice (the “Negotiation Period”) the terms
      of the Option License, which shall be reasonable and shall be negotiated
      and agreed between the Parties in good faith. If the Parties are unable to
      agree the terms of the Option License within the Negotiation
  Period, Alstom’s right to an Option License will lapse, except as
provided in clause 6.7(iii) below.

	 	(iii) 	
      Mantra will not, until the end of the Negotiation Period,
      negotiate with any third party with a view to granting a licence to use
      Mantra’s Project Results or Project-related Background IPR, or assigning
      such Project Results or Project-related Background IPR, nor, after the end
      of the Negotiation Period, will Mantra grant a licence to or assign its
      Project Results to any third party on any terms more favourable than those
      offered to Alstom pursuant to this clause 6.7. In the event that Mantra
      desires to grant a license or to assign Mantra’s Project Results to any
      third party for use, or which may allow use, Mantra shall first offer such
      Project Results to Alstom on the same terms and conditions as are offered
      to the third party. Alstom shall have 30 days during which to accept said
      offer. If Alstom does not accept said offer within said period, Mantra
      shall be free to accept the third-party offer. If Mantra does not enter
      into an agreement with the third party on said terms and conditions and
      close the transaction within 90 days, Alstom’s right of first refusal
      shall be reinstated and the procedure described in this paragraph 6.7(iii)
      shall again be applicable.

	 	 	 
	 	(iv) 	
      Until the end of the Negotiation Period, Mantra will keep
      all Mantra Project Results confidential.

	6.8 	
      Each Party shall ensure that its Affiliates, employees,
      consultants, contractors and agents conducting work under the Projects
      comply with the requirements of this Article 6 with respect to any
      Foreground IPR developed by such Affiliates, employees, consultants,
      contractors and agents directly as a result of the Project.

	 	 
	6.9 	
      Either Party may assign any or all of its rights under
      Foreground IP to any of its Affiliates, subsidiaries, sibling
      corporations, parent, or successors in interest upon written notice to the
      other Party, and the other Party shall cooperate in the execution of
      documents necessary for such assignment.

	7 	
      Warranty and
Liability

	7.1 	
      Each party represents to the other Party that it is not
      aware of any infringement of third party Intellectual Property Rights. As
      soon as either Party becomes aware of an infringement of third party
      intellectual property rights, it shall immediately notify the other Party
      thereof.

	 	 
	7.2 	
      Mantra warrants that it will perform its obligations
      hereunder using state of the art methods and reasonable care and
    skill.

	 	 
	7.3 	
      Except for the representations in Articles 7.1 and 7.2,
      any other representations or warranties are expressly excluded. In
      particular, (i) neither Party warrants to the other Party that the
      information supplied under this Agreement is accurate or complete; (ii)
      neither Party warrants the fitness for any purpose of the Results or that
      the Results can be further used for any specific developments or in
      connection with certain products or processes; (iii) neither Party
      warrants to the other Party that the Results achieved do not infringe
      third party intellectual property rights.

	7.4 	
      To the extent that any Party has the rights to products
      and/or services pursuant to Article 6 and chooses to commercialise
      products and/or services based on Results, such Party shall bear the sole
      responsibility for the conception of such products or services and shall
      be liable towards third parties in connection with such
      commercialisation.

	 	 
	7.5 	
      Neither Party shall be liable towards the other Party for
      loss of profit, loss of use, loss of production, loss of contract or any
      other economic or financial loss or for any other special, indirect or
      consequential damages whatsoever.

	8 	
      Payments

	8.1 	
      Costs for each approved Work Package and Phase shall be
      no greater than that shown in the itemized budget for the relevant
      Project’s Special Terms and Conditions.

	 	 
	8.2 	
      Mantra shall submit to ALSTOM a detailed, monthly
      invoice, specifying the services completed and the relevant Work Package
      and/or Phase. Alstom will pay Mantra approved fees and expenses for
      services performed in accordance with this Agreement within 30 days after
      receipt of invoice. The invoice will be submitted to Alstom within 60 to
      90 days of the end of a Project. The payment of retention money for will
      be made after Alstom’s final acceptance of deliverables due under the
      Project. Alstom’s billing address is:

ALSTOM (Switzerland) Ltd. 
Brown
Boveri Str. 7 
5401 Baden 
Switzerland 
Attn: Michal Bialkowski

		
      Payments shall be submitted to the address noted on the
      invoice.

	 	 
	9 	
      Duration and Termination of the
    Contract

	9.1 	
      This Agreement shall come into force upon signing by both
      Parties and, subject to section 9.2, shall remain valid for (five) 5 years
      or the completion of the last active Project, whichever last occurs. This
      Agreement may be extended at any time by the written agreement of both
      Parties.

	 	 
	9.2 	
      On termination of a Project under this Agreement, both
      Parties undertake either to return or to demonstrably destroy all
      confidential information and data belonging to the other Party, which have
      been received during the period of the respective Project, provided,
      however, that the Parties may retain any Deliverables defined under the
      Special Terms and Conditions of a Project.

	 	 
	9.3 	
      This Agreement may be terminated by either Party at any
      time upon three (3) months written notice.

	 	 
	9.4 	
      Without prejudice to any other rights provided herein,
      either Party may terminate this Agreement by written notice to the other
      Party in the following cases:

insolvency, liquidation, commencement
of insolvency or winding-up proceedings of either Party; or 

either Party assigns or attempts to
assign its rights or obligations under this Agreement or any part thereof to any
other party (except as otherwise expressly provided under this Agreement)
without the prior written consent of the other Party. 

	9.5 	
      In the event of termination or expiration under this
      Agreement, Mantra shall immediately stop all work and provide Alstom with
      the latest drafts and completed versions of any Deliverables prepared by
      Mantra.

	 	 
	9.6 	
      Upon early termination by Alstom, other than as a result
      of Mantra’s breach of this Agreement, Mantra shall be entitled to payments
      due for approved work completed on or before the date of termination and
      for which an acceptable invoice is submitted in accordance Article 8 of
      this Agreement.

	 	 
	9.7 	
      The provisions of Articles 4, Error! Reference source
      not found., 6, 7, and 10 shall survive any expiration or termination
      of this Agreement. With respect to Article 5, Paragraphs 5.1 through 5.7
      shall survive for a period of one (1) year after expiration or termination
      of this Agreement, and Articles 5.8 and 5.9 shall survive
    indefinitely

	10 	
      Dispute Settlement / Applicable
  Law

	 	 
		
      In the event of any dispute arising out of or in
      connection with this Agreement, the parties agree to submit the matter to
      settlement proceedings under the ICC ADR Rules. If the dispute has not
      been settled pursuant to the said Rules within 45 days following the
      filing of a Request for ADR or within such other period as the parties may
      agree in writing, such dispute shall be finally resolved under the Rules
      of Arbitration of the International Chamber of Commerce by three
      arbitrators appointed in accordance with the said Rules of Arbitration.
      The language of the arbitration shall be English. The place of arbitration
      shall be New York, USA. This Agreement shall be governed by, and
      construed in accordance with, the laws of New York, USA.

	 	 
	11 	
      Miscellaneous

	11.1 	
      Any amendments, additions or changes to this Agreement
      shall be specified in writing in supplements and must be signed by all
      contracting parties.

	 	 
	11.2 	
      This Agreement supersedes and cancels all previous
      understandings, negotiations, representations, and agreements between the
      Parties with respect to the subject thereof, whether oral or written. If
      Alstom issues a purchase order or other document purporting to relate to
      this Agreement, such document issued by Alstom shall be considered to be
      for Alstom’s internal use only, and the provisions contained therein shall
      not amend this Agreement except as may be expressly agreed to by Mantra in
      writing.

	11.3 	
      This Agreement, with attached Appendices and Addenda,
      constitutes the entire agreement between the Parties relative to the
      subject matter.

	 	 
	11.4 	
      Whenever possible, provisions in this Agreement and its
      Appendices and Addenda will be construed as complementary rather than
      conflicting; however, in the case of an ambiguity or conflict, the
      documents will be interpreted and prevail in the following descending
      order of priority: this Agreement;

the Appendices to this Agreement in
numerical order so that Appendix 1 has the highest priority and so on; 

the Addenda to this Agreement in
alphabetical order so that Addendum A has the highest priority and so on. 

	11.5 	
      The failure of either Party to insist, in any one or more
      instances, upon the strict performance of any of the provisions of this
      Agreement or to exercise any right contained herein will not be construed
      as, or constitute in any way, a waiver, modification or relinquishment of
      the performance of such provision or right(s), or of the right to
      subsequently demand such strict performance or exercise such right(s).
      Unless expressly agreed to in writing, the rights will remain in full
      force and effect.

	 	 
	11.6 	
      This Agreement and all rights hereunder are intended for
      the sole benefit of the Parties and will not imply or create any rights on
      the part of, or obligations to, any other Person, except as otherwise
      expressly provided for under this Agreement.

	 	 
	11.7 	
      The Parties are independent contractors to each other,
      not partners or joint venturers. Neither Party will have any right, power
      or authority to enter into any contract or undertaking for, or act on
      behalf of, or to act as or be an agent or representative of, or to
      otherwise bind, the other Party, unless expressly agreed otherwise in
      writing.

	 	 
	11.8 	
      Either Party may assign this Agreement (or any part
      thereof) to any of its affiliates, subsidiaries, sibling corporations
      (including any ALSTOM joint venture corporation), parent, or successors in
      interest upon written notice to the other Party. This Agreement will inure
      to the benefit of and be binding upon the successors and assigns of the
      Parties.

	 	 
	11.9 	
      If any provision of this Agreement should be found to be
      invalid, this shall not in any way affect the validity of the remaining
      provisions. To the extent that any provision is held void, invalid,
      unenforceable or inoperative, both Parties agree to negotiate in good
      faith to achieve an equitable adjustment in the provisions of this
      Agreement with a view to achieving the original purpose and intent of the
      Agreement.

Alstom (Switzerland) Ltd. 

Place: _____________________

Date: ______________________

___________________________ 
(Signature) 

___________________________ 
(Signature) 

 

Mantra Energy Alternatives Ltd. 

Place: _____________________

Date: ______________________

___________________________ 
(Signature) 

___________________________ 
(Signature) 

APPENDIX 1 

Description of the “Technology” 

Note: For a full description of the ERC technology and
associated IP, see the patent application WO/2007/041872, “Continuous Co-current
Electrochemical Reduction of Carbon Dioxide”. 

The ERC (“Electro-Reduction of Carbon Dioxide”) technology
employs an electrochemical reactor to convert carbon dioxide (CO2)
into formate ions (HCO2-), and subsequently a formate salt (e.g.
NaHCO2, KHCO2, or NH4CO2) or formic
acid (H2CO2). In general the process involves the mixing
of a CO2-containing gas stream with an aqueous liquid electrolyte,
their co-current two-phase flow through and over a porous three-dimensional (3D)
cathode at which the reduction reaction takes place, and the separation of the
product. The process also involves a complementary oxidation reaction at the
counter electrode, or anode, and the corresponding electrolyte handling. 

The ERC reactor is generally composed of a number of
compartments, or cells, each of which contains two electrodes spaced apart and
separated into two chambers by an ionically conductive but electronically
insulating layer that prevents mixing of the fluids in each compartment. The
negatively charged electrode (cathode) is in the form of a fluid permeable
conductive mass, such as a bed of particles or a fixed porous matrix, which is
composed of an electronically conductive material, the surface of which is a
good electro-catalyst for the desired reaction. CO2-containing gas and an ionically conductive liquid (cathode electrolyte, or catholyte)
flow co-currently into the cathode chamber via an inlet, through and over this
cathode where the desired reduction reaction takes place, and out of the cathode
chamber via an outlet. A complementary oxidation reaction occurs at the
counter-electrode (positively-charged terminal or anode), where an ionically
conductive liquid (anode electrolyte, or anolyte) flows over or through this
electrode, which can be flat or 3D. The operating parameters of this reactor are
selected such that advantageous mass transfer characteristics are obtained. 

While there are a wide variety of setups, reactants, products,
and operating parameters through which ERC can be used, an example is provided
below based on one of these embodiments. This example represents a small range
of the ways in which ERC can be implemented, but is nonetheless
illustrative.

In this example ERC is employed to convert CO2 to
sodium formate (NaHCO2). An aqueous solution of a sodium salt such as
sodium bicarbonate (NaHCO3) would be used as the catholyte, generally
in concentrations of greater than 1 M to provide sufficient ionic conductivity.
Additives such as sodium chloride (NaCl) may be included to further promote
conductivity. This catholyte is mixed with a CO2-containing gas stream, which, depending on its
composition, may be pretreated to remove particulates or other impurities. The
mixture flows co-currently in two-phase flow into the cathode chamber(s) and
over and through the 3D cathode. Employing a 3D structure for the cathode
greatly increases the surface area available for reaction and reduces CO2
mass transfer constraint . An imposed potential difference between the two
electrodes causes the following “primary” reaction to occur: 

 

It is important to note that the active species in this
reaction is aqueous carbon dioxide [CO2(aq)], as opposed to
gaseous CO2 or bicarbonate. This fact necessitates the presence of
CO2-containing gas in the reactor, as the solubility of CO2
in water is low. The presence of the gas provides the driving force for
maintaining the concentration of CO2 (aq)in the electrolyte.
The gas/liquid holdup ratio in the reactor is an important operating parameter,
and is optimized where enough gas is available to maintain CO2
(aq)concentrations and enough liquid is available to provide
sufficient conductivity. CO2 solubility increases with increasing
CO2 partial pressure and decreasing temperature, and as a result the
reactor may be run at super-atmospheric pressure (or, in the case of an impure
gas stream, enriching its CO2 volume fraction) and at ambient
temperatures. 

The speciation between
CO2(g)/CO2(aq)/HCO3-/CO3 2-,
and thus the pH upon which this speciation is dependent, is critical to
the efficacy of the process. High pH values will result in much of the aqueous
CO2 being sequestered as carbonate, while low values will contribute
to an undesirable side reaction that also occurs at the cathode: 

 

Although Reaction 2 is thermodynamically favored over Reaction
1, the selection of an electro-catalyst with a high hydrogen overpotential (e.g.
Pb, Sn, In, or Hg) for the cathode surface will promote Reaction 1 over Reaction
2. Operation above pH 7 and below pH 10 is preferred, to suppress both Reaction
2 and the sequestration of CO2 in carbonic species. The occurrence of
Reaction 2 makes the direct formation of formic acid difficult, as this would
require operation in acidic conditions. Other side reactions may occur to a
small extent, such as the reduction of CO2 to CO orhydrocarbons. The
“current efficiency” is an important indicator of performance, and represents
the fraction of the current that is consumed in the primary desired reaction
(CO2 reduction to formate).

At the anode a complementary oxidation reaction occurs. The
function of the anolyte is both to provide electrons for reduction and provide
cations to balance the charge. In the instance of producing NaHCO2,
the anolyte would thus need to contain sodium ions, and would likely be sodium
hydroxide (NaOH) or a sodium salt such as NaCl. The corresponding oxidation
reactions are: 

 

As a result of the oxidation, a co-product is formed. In the
instances of hydroxide and chloride, the co-product would be oxygen gas and
chlorine gas, respectively.

Both catholyte and anolyte leave the reactor through their
respective outlets and are directed to phase separators. The
CO2-containing cathode gas is separated, any hydrogen present removed
or recovered, and the remaining gas vented or recycled. Product-containing
catholyte liquid may be recycled to the reactor to increase product
concentrations, and may undergo further concentration stages. Byproduct gas from
the anode is vented or recovered and the anolyte is recycled to the reactor.

APPENDIX 2 

 

 

ADDENDUM A 

Special Terms and Conditions for the
CO2-to-Formate pilot project (“Pilot Project”) 

RECITALS 

WHEREAS, the Parties wish to pursue activities to
design, install, operate and test a pilot based on the Technology and located in
an industrial site (the “Pilot”), and evaluate the scale-up of such Pilot
to commercial scale to determine the feasibility of manufacture and
commercialization of products and equipment for the conversion of CO2 to Formate and Formic Acid for sale to
Third Parties, all on the terms and conditions set forth in the Agreement and this Addendum.

A.1 DEFINITIONS 

A.1.1 “Field” means the use of the Technology for the
conversion of CO2 to formate and formic acid. 

A.1.2 “Host Site” means Third Party provider of an
industrial site to host the Pilot in a contract or similar agreement with a
Party and/or its Affiliates in furtherance of or to assist a Party (and such
Party’s Affiliates, as appropriate) in site arrangement, installation,
operation, demonstrative and validation purpose or studies in such Party’s
performance of the Pilot Project. 

A.1.3 “Off-taker” means Third Party providing services
to off-take at the Host Site formate and formic acid produced by the Pilot, and
in a contract or similar agreement with a Party and/or its Affiliates in
furtherance of or to assist such Party (and such Party’s Affiliates, as
appropriate) performance of the Pilot Project. 

A.1.4 “Work Plan” means the written plan agreed upon by
the Parties describing in detail the development activities to be carried out in
connection with the Pilot Project, including, without limitation, a description
and summary of the technical targets and timelines for each of the activities to
be conducted by the Parties, as well as appropriate allocation of FTE; which
written plan may be amended from time to time by written agreement of the
Parties. The Work Plan, and any amendment thereto, shall be attached this
Agreement. 

 

A.1.6 “Deliverables” means each Party shall deliver to
the other Party all relevant information, data, reports and results arising from
their respective performance of the Work Plan, describing in detail the work
accomplished by such Party, along with any samples, materials, or other
information reasonably requested by any other Party to support Alstom’s
evaluation of whether the Pilot Project passes TCGR pursuant to Sections A.1.5
and A.5.1 herein. Any Deliverables delivered to a Party hereunder shall be owned
by the delivering Party, subject to the intellectual property ownership provisions set forth in the Agreement and shall be deemed to be
Confidential Information of the Party who own such Deliverables. 

A.3 ROLES AND RESPONSIBILITIES 

	Party 	Role 	Responsibility 
	Mantra 

	Lead execution of Pilot Project
      

	•    Design of process and units
      operation based on the Technology 
•    Selecting and
      securing a Host Site, ensuring that flue gas
      delivery, 
     necessary utilities and
      waste are properly management for the
      safe 
     operation of the Pilot.
      
•    Identifying a potential Off-taker to engage in the
      pilot validation 
•    Engineering, Procurement and
      Construction of the Pilot at the
      Host 
     Site utilizing an Approved
      Subcontractor 
•    Leading the elaboration of the pilot
      instrumentation and
      validation 
     plan, in collaboration
      with the Host Site and Alstom 
•    Leading the
      commissioning of the Pilot, in collaboration with the
      Host 
     Site and Alstom
      
•    Leading the Pilot operation and testings, in
      collaboration with Host 
     Site,
      Off-taker and Alstom 
•    Results analysis, in
      collaboration with Host Site and Alstom 
•  
       Investigate external funding/grant opportunities 
	Alstom 	Provide pilot engineering,
      operation and testing services 	•    Conceptual design for a
      scaled up, commercial size plant:
      CAPEX, 
     OPEX and end-product costs
      evaluation 
•    Participate in making of pilot
      validation plan 
•    Review design, results and
      analysis 
•    Provide expertise for analytical,
      chemistry and engineering 
     issues
      during project 
•    Investigate external funding/grant
      opportunities 

 

 

 

 

A.6 FINANCING 

Mantra 

Alstom 

	In-kind contribution to project (ca. 1.5FTE for whole duration of the
  project) to deliver scope of work as described in section A.5. 

A.7 CONTACT PERSONS 

Mantra 

Larry Kristof 
#562 800 15355 24th Ave.

Surrey, BC, V4A 2H9 
Canada 
larry@mantraenergy.com 
+1-604-616-9607 

Alstom 

Dr. Frederic Vitse 
1409 Centerpoint Blvd 
Knoxville, TN
37932-1962 
USA 
frederic.vitse@power.alstom.com

+1 865 560 1732 

Dr. Steve Bedell 
1409 Centerpoint Blvd 
Knoxville, TN
37932-1962 
USA 
steve.bedell@power.alstom.com

+1 865 670 4462 

ADDENDUM B 

 

B.5 ROLES AND RESPONSIBILITIES 

	Party 

	Role 

	Responsibility 

	Observation 

	Mantra 	Test leader and upscale task owner 	•    Test preparation and
      execution 

      •   Electrode manufacturing 

•   Results analysis 

•   Reactor scale up 

•   Conceptual design of the pilot 	

	Alstom 	Project sponsor, experimental data stakeholder
      and reviewer; supports conceptual design of the pilot 	•   Project management
      

      •   Review results and analysis 
• 
       Participate in the
      conceptual 
     design of the pilot
      
•   Support selection of the pilot site. 
•  
      Conceptual design for a scaled 
     up
      pilot; provides
      integration 
     support. 
• 
       Provides support to
      engineering 
     design of the pilot.	

    

B.6 WORK PACKAGES 

 

 

 

 

 

 

 

 

B.6 MASTER TIME SCHEDULE

 

B.7 FINANCING 

Financing of project phases is subjected to the outcome of the
review and to the conditions in Section 8. Table 3 shows the summary of the
project cost and its breakdown for each phase of the project. Phase 1 of the
project will be paid by Alstom with a 30% upfront payment. The remaining funding
will be paid prior to commencing of each phase with the similar payment
conditions as for Phase 1. In case an external funding is granted the
contribution of Alstom will be reduced accordingly. 

Table 3: The costs break down for each activity phase.

	Project stage 	Labour [CAN $] 	Material [CAN $] 
	Phase 1: Baseline
      
electrode/membrane selection 	
175’000 	
15’375 
	Phase 2: Improving catalyst
      
functionality 	
225’000 	
15’375 
	Phase 3: Reactor scale-up
      
Design 	
165’000 	
15’375 
	Phase 4: Conceptual pilot plant 	20’000 	15’375 
	

Phase 5: Build and commission of
      
pilot plant 
	TBD and depend of 
the outcome of prior
      
Phases and the test 
vehicle and external 
funding opportunities
    	

	TOTAL 	585’000+cost of
      
Phase 5 	61’500

	Future Technology Execution contribution to project (ca. 0.5 – 1.5 FTE for
  whole duration of the project) 

There will be monthly project reviews between Mantra and Alstom
to ensure the project is heading in the right direction and to plan the
manpower/activities for the following month. These reviews will take place early
in the final week of each month. 

A.8 CONTACT PERSONS 

Mantra 

Larry Kristof 
#562 800 15355 24th Ave. 
Surrey, BC, V4A
2H9 
Canada 
larry@mantraenergy.com 
+1-604-616-9607 

Alstom 

Dr. Michal Bialkowski 
Future Technology Execution, Alstom
Power 
Geb 229B, Zentralstrasse 40, 5242 Birr 
Switzerland 
michal.bialkowski@power.alstom.com 
Office: +41 58
506 5807 
Cell: +41 79 596 52 86

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