Document:

SERIES A WARRANT

 
EXHIBIT 4.3

 
THE SECURITIES REPRESENTED BY THIS WARRANT HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER ANY APPLICABLE STATE SECURITIES LAWS, AND MAY NOT BE SOLD OR OFFERED FOR SALE OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER SAID ACT AND ANY
APPLICABLE STATE SECURITIES LAWS OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO TEAM SPORTS ENTERTAINMENT, INC., THAT SUCH REGISTRATION IS NOT REQUIRED. 
 
Warrant No. TSPT-         
 
SERIES A WARRANT 
 
TO PURCHASE COMMON STOCK 
 
OF 
 
TEAM SPORTS ENTERTAINMENT, INC. 
 
This is to certify that
                 (the “Holder”) is entitled, subject to the terms and conditions hereinafter set forth, to purchase
                    (            ) shares (the “Common
Shares”) of common stock, par value $.001 per share (the “Common Stock”), of Team Sports Entertainment, Inc., a Delaware corporation (the “Company”), from the Company at the price per
share and on the terms set forth herein and to receive a certificate for the Common Shares so purchased on presentation and surrender to the Company of this Series A Warrant (this “Warrant”) with the Notice of Exercise
substantially in the form attached, duly executed and accompanied by payment of the aggregate purchase price of each share purchased either in cash, by wire transfer, or by certified or bank cashier’s check or other check payable to the order
of the Company. 
 
1. Exercise of Warrants.
The purchase rights represented by this Warrant are exercisable at the option of the registered owner hereof in whole or in part, from time to time, within the period specified below; provided, however, that such purchase rights shall not be
exercisable with respect to a fraction of a Common Share. In case of the purchase of less than all the Common Shares purchasable under this Warrant, the Company shall cancel this Warrant on surrender hereof and shall execute and deliver a new
Warrant of like tenor and date for the balance of the shares purchasable hereunder. 
 
(a) Exercise Price. The exercise price (the “Exercise Price”) shall be $1.00 per Common Share, subject to adjustment pursuant to Section 3 below. 
 
(b) Expiration of Warrant Term. The Warrants
will expire on the earlier of (i) 5:00 p.m. Eastern Standard Time on the three (3) year anniversary of the date that the Securities and Exchange Commission declares effective a registration statement (“Registration 

 
Statement”)
that registers the resale of the Common Shares under the Securities Act of 1933, as amended (the “Securities Act”), (ii) the expiration of the seventy-two (72) hour notice period described in Section 2 below and (iii) the
date on which the Warrant has been exercised or cancelled with respect to all Common Shares. 
 
2. Warrant Call. At any time after the closing bid of the Common Stock exceeds $5.00 per share for ten (10) consecutive trading days or more, the Company may require the Holder to
exercise all or any portion of this Warrant within seventy-two (72) hours of the Company providing written notice to the Holder of the Company’s intention to call the Warrant. In the event this Warrant has not been exercised by written notice
within such seventy-two (72) hour notice period, this Warrant will terminate as of such date and be cancelled and may not be exercised thereafter. 
 
3. Anti-Dilution. In the event that the outstanding Common Shares hereafter are changed into or exchanged for a different number or
kind of shares or other securities of the Company or of another corporation by reason of merger, consolidation, reorganization, recapitalization, reclassification, combination of shares, stock split-up or stock dividend (not including shares
pursuant to acquisitions classified as mergers, reorganizations or share exchanges): 
 
(a) The aggregate number, price and kind of Common Shares subject to this Warrant shall be adjusted appropriately by the Board of Directors of the Company; 
 
(b) Rights under this Warrant, both as to the number of
subject Common Shares and the Exercise Price, shall be adjusted appropriately by the Board of Directors of the Company; and 
 
(c) In the event of dissolution or liquidation of the Company or any merger or combination in which the Company is not a surviving
corporation, this Warrant shall terminate, but the registered owner of this Warrant shall have the right, immediately prior to such dissolution, liquidation, merger or combination, to exercise this Warrant in whole or in part to the extent that it
shall not have been exercised. 
 
The foregoing
adjustments and the manner of application of the foregoing provisions may provide for the elimination of fractional share interests. 
 
4. Covenants of the Company. The Company agrees at all times to reserve or hold available a sufficient number of shares of Common
Stock to provide for the issuance of the Common Shares upon exercise of this Warrant. 
 
5. Covenants of the Holder. The Holder acknowledges, recognizes and agrees that (i) unless a Registration Statement is effective and current with respect to the underlying Common Shares, sales may only
be made pursuant to Rule 144 under the Securities Act and (ii) the Company is not required to satisfy the conditions of Rule 144 or any other rule or provision with respect to the sale of the Common Shares. 
 
6. Conditions to Exercise of Warrant. The Holder shall
have the right to exercise all or a portion of this Warrant upon the satisfaction of the following conditions: 
 

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(a) The
completion of any required registration or other qualification of the Common Shares under any federal or state law or under the rulings or regulations of the Securities and Exchange Commission or any other government regulatory body which is
necessary; 
 
(b) The obtaining of any approval or
other clearance from any federal or state government agency which is necessary; 
 
(c) The obtaining from the registered owner of the Warrant, as required in the sole judgment of the Company, of such representations and warranties as the Company may determine to comply with
applicable laws and regulations, including a representation in writing that the owner is acquiring such Common Shares for the owner’s own account for investment and not with a view to, or for sale in connection with, the distribution of any
part thereof, if the Warrants and the related shares have not been registered under the Act; and 
 
(d) The placing on the certificate (and any exchanged or substitute certificates), as required in the sole judgment of the Company, of an appropriate legend and the issuance of stop transfer
instructions in connection with this Warrant and the underlying Common Shares to the following effect: 
 
“THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR THE LAWS OF ANY STATE
AND HAVE BEEN ISSUED PURSUANT TO AN EXEMPTION FROM REGISTRATION PERTAINING TO SUCH SECURITIES AND PURSUANT TO A REPRESENTATION BY THE SECURITY HOLDER NAMED HEREON THAT SAID SECURITIES HAVE BEEN ACQUIRED FOR PURPOSES OF INVESTMENT AND MAY NOT BE
OFFERED, SOLD, TRANSFERRED, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF REGISTRATION. FURTHERMORE, NO OFFER, SALE, TRANSFER, PLEDGE OR HYPOTHECATION IS TO TAKE PLACE WITHOUT THE PRIOR WRITTEN APPROVAL OF COUNSEL OR THE ISSUER BEING AFFIXED TO THIS
CERTIFICATE. THE TRANSFER AGENT HAS BEEN ORDERED TO EXECUTE TRANSFERS OF THIS CERTIFICATE ONLY IN ACCORDANCE WITH THE ABOVE INSTRUCTIONS.” 
 
7. Rights of Holder Before Exercise. This Warrant shall not entitle the Holder to any voting rights or other rights as a shareholder
of the Company, or to any other rights whatsoever except the rights herein expressed and set forth, and no dividends shall be payable or accrue in respect of this Warrant or the interest represented hereby or the Common Shares purchasable hereunder
until or unless, and except to the extent that, this Warrant shall be exercised. 
 
8. Amendment. Neither this Warrant nor the rights granted hereunder may be amended, changed or waived except in writing signed by each party hereto. 
 
9. Notice. The address of record for Holder maintained by the Company for all purposes of this Warrant
shall be that address set forth beneath Holder’s signature on the Subscription and Investment Representation Agreement executed and delivered to the Company simultaneously 
 

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herewith. Any notice to be
delivered to the Company shall be sent to: 1111 South Main, Suite 127, Grapevine, TX 76051. Holder may change his, her or its address of record only by notifying the Company in the manner prescribed herein. All notices, requests, and other
communications required or permitted to be given or delivered hereunder to either party must be in writing, and shall be personally delivered, sent by certified or registered mail, postage prepaid or by overnight courier (such as Federal Express) to
such party at the address of record. Any notice under this Warrant shall be deemed to have been sufficiently given or served and effective for all purposes when deposited with the United States Postal Service or overnight courier. 
 
IN WITNESS WHEREOF, the Company has caused this Series
A Warrant to be executed by the signature of its duly authorized officer and the Holder has executed this Series A Warrant each as of this          day of July, 2001. 
 

	 COMPANY:

	 TEAM SPORTS ENTERTAINMENT,
INC.

	
	 By:
	 	  

	 	 	 Terry Washburn,
 Chief Executive Officer

 

	 HOLDER:
 If Individual:

	
	 X

	
	 Print Name: 

	 If a corporation or other entity:

 

	

	 Name of entity

	
	 By:
	 	  

	 Print Name:

	 Title:

 

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NOTICE OF
EXERCISE 
 
(To be executed by the Holder to
exercise the rights to purchase 
Common Shares evidenced by the within Series A Warrant.) 
 
TEAM SPORTS ENTERTAINMENT, INC. 
1111 South Main, Suite 127 
Grapevine, TX 76051 
 
The undersigned hereby irrevocably elects to exercise its right to purchase              Common Shares pursuant to and in accordance with the terms and
conditions of this Series A Warrant, and herewith makes payment of $             therefor, and requests that a certificate for such Common Shares be issued in the name of the
undersigned and be delivered to the undersigned at the address stated below, and if such number of shares shall not be all of the shares purchasable hereunder, that a new Series A Warrant of like tenor for the balance of the remaining Common Shares
purchasable hereunder shall be delivered to the undersigned at the address stated below. 
 

	 Dated:                
	 	 	 	 If Individual:

	
	 	 	 	 	 	 	 	 	 X

	 	 	 	 	 	 	 	 	 Print Name: 

	 	 	 	 	 	 	 	 	 Address:

	 	 	 	 	 	 	 	 	  

 

	 	 	 	 	 If a corporation or other entity:
	 	 

 

	

	 Name of entity

	
	 By:
	 	  

	 Print Name:

	 Title:

	 Address:

	  

 

5PROMISSORY NOTE PURCHASE AGREEMENT

 
EXHIBIT 4.4

 
PROMISSORY NOTE PURCHASE AGREEMENT

 
This PROMISSORY NOTE PURCHASE
AGREEMENT is dated as of September 1, 2002 (this “AGREEMENT”) by and between TEAM SPORTS ENTERTAINMENT, INC., a Delaware corporation (the “COMPANY”), and the entities listed on EXHIBIT “A” hereto (each
a “PURCHASER” and collectively, the “PURCHASERS”). 
 
The parties hereto agree as follows: 
 
ARTICLE I 
 
PURCHASE AND
SALE OF PROMISSORY NOTES 
 
Section 1.1 PURCHASE AND
SALE OF PROMISSORY NOTES. Upon the following terms and conditions, the Company shall issue and sell to the Purchasers, and the Purchasers shall purchase from the Company, secured convertible promissory notes in the aggregate principal amount of
Two Million Five Hundred Thousand Dollars ($2,500,000.00) bearing interest at the rate of eight percent (8%) per annum, convertible into shares of the Company’s common stock, $.000l par value per share (the “COMMON STOCK”), in
substantially the form attached hereto as EXHIBIT “B” (The “NOTES”), set forth with respect to such Purchaser on EXHIBIT “A” hereto. The Company and the Purchasers are executing and delivering this Agreement in
accordance with and in reliance upon the exemption from securities registration afforded by Section 4(2) of the U.S. Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder (the “SECURITIES ACT”), including
Regulation D (“REGULATION D”), and/or upon such other exemption from the registration requirements of the Securities Act as may be available with respect to any or all of the investments to be made hereunder. 
 
Section 1.2 PURCHASE PRICE AND CLOSING. The Company agrees to
issue and sell to the Purchasers and, in consideration of and in express reliance upon the representations, warranties, covenants, terms and conditions of this Agreement, the Purchasers agree to purchase the Notes for an aggregate purchase price of
Two Million Five Hundred Thousand Dollars ($2,500,000.00) (the “PURCHASE PRICE”). The closing (the “Closing”) of the execution and delivery of this Agreement shall occur upon delivery by facsimile of executed signature pages of
this Agreement and all other documents, instruments and writings required to be delivered pursuant to this Agreement to G. David Gordon & Associates, P.C., 7633 East 63rd Place, Suite 210, Tulsa, Oklahoma 74133. The Closing shall take place no later than September 10, 2002. Funding with respect to the Closing shall take place
by wire transfer of immediately available funds in the amounts shown on EXHIBIT “A”, on or prior to the Closing Date (as defined below), so long as the conditions set forth in ARTICLE IV hereof shall be fulfilled or waived in accordance
herewith. The Closing shall take place at the offices of G. David Gordon & Associates, P.C. at 5:00 p.m. (Central time) upon the satisfaction of each of the conditions set forth in ARTICLE IV hereof (the “CLOSING DATE”). 
 
Section 1.3 CONVERSION SHARES. The Company has authorized and
has reserved and covenants to continue to reserve free of preemptive rights and other similar contractual rights of stockholders, a number of its authorized but unissued shares of Common Stock equal to at least 

 
100% of the aggregate number
of shares of Common Stock issuable at a conversion price equal to the Conversion Price (as defined in the Notes). Any shares of Common Stock issuable upon conversion of the Notes (and such shares when issued) are herein referred to as the
“CONVERSION SHARES”. The Notes and the Conversion Shares are sometimes collectively referred to herein as the “SECURITIES.” 
 
ARTICLE II 
 
REPRESENTATIONS AND WARRANTIES 
 
Section 2.1 REPRESENTATIONS AND WARRANTIES OF THE COMPANY. In order to induce the Purchasers to enter into this Agreement and to purchase
the Notes and the Warrants, the Company hereby makes the following representations and warranties to the Purchasers: 
 
(a) ORGANIZATION, GOOD STANDING AND POWER. The Company is a corporation duly incorporated, validly existing and in good standing under the
laws of the State of Delaware and has the requisite corporate power to own, lease and operate its properties and assets and to conduct its business as it is now being conducted. The Company is duly qualified as a foreign corporation to do business
and is in good standing in every jurisdiction in which the nature of the business conducted or property owned by it makes such qualification necessary except for any jurisdiction(s) (alone or in the aggregate) in which the failure to be so qualified
will not have a Material Adverse Effect on the Company’s operations. For the purposes of this Agreement, “MATERIAL ADVERSE EFFECT” means any adverse effect on the business, operations, properties, prospects or financial condition of
the Company and which is material to such entity or other entities controlling or controlled by such entity or which is likely to materially hinder the performance by the Company of its obligations hereunder. 
 
(b) AUTHORIZATION; ENFORCEMENT. The Company has the requisite
corporate power and authority to enter into and perform this Agreement, the Security Agreement, the Notes, (collectively, the “TRANSACTION DOCUMENTS”) and to issue and sell the Securities in accordance with the terms hereof and the Notes,
as applicable. The execution, delivery and performance of the Transition Documents by the Company and the consummation by it of the transactions contemplated thereby have been duly and validly authorized by all necessary corporate action, and no
further consent or authorization of the Company or its Board of Directors or stockholders is required. This Agreement has been duly executed and delivered by the Company. The other Transaction Documents will have been duly executed and delivered by
the Company at the Closing. Each of the Transaction Documents constitutes, or shall constitute when executed and delivered, a valid and binding obligation of the Company enforceable against the Company in accordance with its terms, except as such
enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, liquidation, conservatorship, receivership or similar laws relating to, or affecting generally the enforcement of, creditor’s rights and remedies or
by other equitable principles of general application. 
 
(c) CAPITALIZATION. The authorized capitalization of the Company consists of Five Hundred Million (500,000,000) shares of Common Stock, $.000l par value, of which Sixty-Two Million Five Hundred Sixty-Eight Thousand Three Hundred
Twelve (62,568,312) 
 

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shares have been issued and
are outstanding. All of the outstanding shares of the Company’s Common Stock and any other security of the Company have been duly and validly authorized. Except as set forth in this Agreement or on SCHEDULE 2.1(c), no shares of Common Stock or
any other security of the Company are entitled to preemptive rights or registration rights and there are no outstanding options, warrants, scrip, rights to subscribe to, call or commitments of any character whatsoever relating to, or securities or
rights convertible into, any shares of capital stock of the Company. Furthermore, except as set forth in this Agreement or on SCHEDULE 2.1(c) hereto, there are no contracts, commitments, understandings, or arrangements by which the Company is or may
become bound to issue additional shares of the capital stock of the Company or options, securities or rights convertible into shares of capital stock of the Company. Except for customary transfer restrictions contained in agreements entered into by
the Company in order to sell restricted securities or as provided on SCHEDULE 2.1(c) hereto, the Company is not a party to or bound by any agreement or understanding granting registration or anti-dilution rights to any person with respect to any of
its equity or debt securities. Except as set forth on SCHEDULE 2.1(c), the Company is not a party to, and it has no knowledge of, any agreement or understanding restricting the voting or transfer of any shares of the capital stock of the Company.
Except as set forth on SCHEDULE 2.1(c) hereto, the offer and sale of all capital stock, convertible securities, rights, warrants, or options of the Company issued prior to the Closing complied with all applicable federal and state securities laws,
and no holder of such securities has a right of rescission or claim for damages with respect thereto which could have a Material Adverse Effect. The Company has made available to the Purchasers true and correct copies of the Company’s Articles
of Incorporation as in effect on the date hereof (the “ARTICLES”), and the Company’s Bylaws as in effect on the date hereof (the “BYLAWS”). 
 
(d) ISSUANCE OF SECURITIES. The Notes to be issued at the Closing have been duly authorized by all necessary
corporate action and, when paid for and issued in accordance with the terms hereof, the Notes shall be validly issued and outstanding, free and clear of all liens, encumbrances and rights of refusal of any kind (other than federal and state
securities law restrictions). When the Conversion Shares issued and paid for in accordance with the terms of this Agreement and as set forth in the Notes, such shares will be duly authorized by all necessary corporate action and validly issued and
outstanding, fully paid and nonassessable, free and clear of all liens, encumbrances and rights of refusal of any kind (other than federal and state securities law restrictions) and the holders shall be entitled to all rights accorded to a holder of
Common Stock. 
 
(e) NO CONFLICTS. The execution,
delivery and performance of the Transaction Documents by the Company and the consummation by the Company of the transactions contemplated hereby and thereby do not and will not (i) violate any provision of the Company’s Articles or Bylaws, (ii)
conflict with, or constitute a default (or an event which with notice or lapse of time or both would become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, any agreement, mortgage, deed of
trust, indenture, note, bond, license, lease agreement, instrument or obligation to which the Company or any of its Subsidiaries is a party or by which the Company or any of its Subsidiaries’ respective properties or assets are bound (other
than as expressly contemplated by the Transaction Documents), (iii) create or impose a lien, mortgage, security interest, charge or encumbrance of any nature on any property or asset of the Company or any of its Subsidiaries under any agreement or
any commitment to which the Company or any of its Subsidiaries is a party or by which the 
 

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Company or any of its
Subsidiaries is bound or by which any of their respective properties or assets are bound, or (iv) result in a violation of any federal, state, local or foreign statute, rule, regulation, order, judgment or decree (including federal and state
securities laws and regulations) applicable to the Company or any of its Subsidiaries or by which any property or asset of the Company or any of its Subsidiaries are bound or affected, except in all cases other than violations pursuant to clauses
(i) or (iv) above, for such conflicts, defaults, terminations, amendments, acceleration, cancellations and violations as would not, individually or in the aggregate, have a Material Adverse Effect. The business of the Company and its Subsidiaries is
not being conducted in violation of any laws, ordinances or regulations of any governmental entity, except for possible violations which singularly or in the aggregate do not and will not have a Material Adverse Effect. Neither the Company nor any
of its Subsidiaries is required under federal, state, foreign or local law, rule or regulation to obtain any consent, authorization or order of, or make any filing or registration with, any court or governmental agency in order for it to execute,
deliver or perform any of its obligations under the Transaction Documents or issue and sell the Notes, and the Conversion Shares in accordance with the terms hereof or thereof (other than any filings which may be required to be made by the Company
with the Commission, the OTCBB prior to or subsequent to the Closing, or state securities administrators subsequent to the Closing, or any registration statement which may be filed pursuant hereto). 
 
(f) COMMISSION DOCUMENTS, FINANCIAL STATEMENTS. The Common
Stock of the Company is registered pursuant to Section 12(b) or 12(g) of the Securities Exchange Act of 1934, as amended (the “EXCHANGE ACT”), and the Company has timely filed all reports, schedules, forms, statements and other documents
required to be filed by it with the Commission pursuant to the reporting requirements of the Exchange Act, including material filed pursuant to Section 13(a) or 15(d) of the Exchange Act (all of the foregoing including filings incorporated by
reference therein being referred to herein as the “COMMISSION DOCUMENTS”). The Company has made available to the Purchasers true and complete copies of the Commission Documents filed with the Commission since June 30, 2002. At the time of
its filing, the Form 10-QSB for the fiscal quarter ended June 30, 2002 (the “FORM 10-QSB”) complied in all material respects with the requirements of the Exchange Act and the rules and regulations of the Commission promulgated thereunder
and other federal, state and local laws, rules and regulations applicable to such documents, and the Form 10-QSB did not contain any untrue statement of a material fact or omit 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. As of their respective dates, the financial statements of the Company included in the Commission Documents complied as to form in all
material respects with applicable accounting requirements and the published rules and regulations of the Commission or other applicable rules and regulations with respect thereto. Such financial statements have been prepared in accordance with
generally accepted accounting principles (“GAAP”) applied on a consistent basis during the periods involved (except (i) as may be otherwise indicated in such financial statements or the notes thereto or (ii) in the case of unaudited
interim statements, to the extent they may not include footnotes or may be condensed or summary statements), and fairly present in all material respects the financial position of the Company and its Subsidiaries as of 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 year-end audit adjustments). 
 

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(g)
SUBSIDIARIES. SCHEDULE 2.1(g) hereto sets forth each Subsidiary of the Company, showing the jurisdiction of its incorporation or organization and showing the percentage of each person’s ownership of the outstanding stock or other interests of
such Subsidiary. For the purposes of this Agreement, “SUBSIDIARY” shall mean any corporation or other entity of which at least a majority of the securities or other ownership interest having ordinary voting power (absolutely or
contingently) for the election of directors or other persons performing similar functions are at the time owned directly or indirectly by the Company and/or any of its other Subsidiaries. All of the outstanding shares of capital stock of each
Subsidiary have been duly authorized and validly issued, and are fully paid and non assessable. There are no outstanding preemptive, conversion or other rights, options, warrants or agreements granted or issued by or binding upon any Subsidiary for
the purchase or acquisition of any shares of capital stock of any Subsidiary or any other securities convertible into, exchangeable for or evidencing the rights to subscribe for any shares of such capital stock. Neither the Company nor any
Subsidiary is subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of the capital stock of any Subsidiary or any convertible securities, rights, warrants or options of the type described in the
preceding sentence except as set forth on SCHEDULE 2.1(g) hereto. Neither the Company nor any Subsidiary is party to, nor has any knowledge of, any agreement restricting the voting or transfer of any shares of the capital stock of any Subsidiary.

 
(h) NO MATERIAL ADVERSE CHANGE. Except as
disclosed in the Commission Documents, since June 30, 2002, the Company has not experienced or suffered any Material Adverse Effect. 
 
(i) NO UNDISCLOSED LIABILITIES. Except as disclosed in the Commission Documents, neither the Company nor any of its Subsidiaries has any
liabilities, obligations, claims or losses (whether liquidated or unliquidated, secured or unsecured, absolute, accrued, contingent or otherwise) other than those incurred in the ordinary course of the Company’s or its Subsidiaries’
respective businesses since June 30, 2002 and which, individually or in the aggregate, do not or would not have a Material Adverse Effect on the Company or its Subsidiaries. 
 
(j) TITLE TO ASSETS. Each of the Company and the Subsidiaries has good and marketable title to all of its
real and personal property, free and clear of any mortgages, pledges charges, liens, security interests or other encumbrances of any nature whatsoever, or such that, individually or in the aggregate, would not have a Material Adverse Effect as of
the Closing Date. All said leases of the Company and each of its Subsidiaries are valid and subsisting and in full force and effect. 
 
(k) ACTIONS PENDING. There is no action, suit, claim, investigation, arbitration, alternative dispute resolution proceeding or other
proceeding pending or, to the knowledge of the Company, threatened against the Company or any Subsidiary which questions the validity of this Agreement or any of the other Transaction Documents or any of the transactions contemplated hereby or
thereby or any action taken or to be taken pursuant hereto or thereto. There is no action, suit, claim, investigation, arbitration, alternative dispute resolution proceeding or other proceeding pending or, to the knowledge of the Company,
threatened, against or involving the Company, any Subsidiary or any of their respective properties or assets, which individually or in 
 

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the aggregate, would have a
Material Adverse Effect as of the Closing Date. There are no outstanding orders, judgments, injunctions, awards or decrees of any court, arbitrator or governmental or regulatory body against the Company or any Subsidiary or any officers or directors
of the Company or Subsidiary in their capacities as such, which individually or in the aggregate, would have a Material Adverse Effect as of the Closing Date. 
 
(l) COMPLIANCE WITH LAW. The business of the Company and the Subsidiaries has been and is presently being conducted in accordance with all
applicable federal, state and local governmental laws, rules, regulations and ordinances, or such that, individually or in the aggregate, then on compliance therewith would not have a Material Adverse Effect. The Company and each of its Subsidiaries
have all franchises, permits, licenses, consents and other governmental or regulatory authorizations and approvals necessary for the conduct of its business as now being conducted by it unless the failure to possess such franchises, permits,
licenses, consents and other governmental or regulatory authorizations and approvals, individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect. 
 
(m) TAXES. The Company and each of the Subsidiaries has accurately prepared and filed all federal, state and
other tax returns required by law to be filed by it, has paid or made provisions for the payment of all taxes shown to be due and all additional assessments, and adequate provisions have been and are reflected in the financial statements of the
Company and the Subsidiaries for all current taxes and other charges to which the Company or any Subsidiary is subject and which are not currently due and payable. None of the federal income tax returns of the Company or any Subsidiary have been
audited by the Internal Revenue Service. The Company has no knowledge of any additional assessments, adjustments or contingent tax liability (whether federal or state) of any nature whatsoever, whether pending or threatened against the Company or
any Subsidiary for any period, nor of any basis for any such assessment, adjustment or contingency. 
 
(n) CERTAIN FEES. Except as set forth on SCHEDULE 2.1(n) hereto, the Company has not employed any broker or finder or incurred any
liability for any brokerage or investment banking fees, commissions, finders’ structuring fees, financial advisory fees or other similar fees in connection with the Transaction Documents. 
 
(o) DISCLOSURE. To the best of the Company’s knowledge,
neither this Agreement or the Schedules hereto nor any other documents, certificates or instruments furnished to the Purchasers by or on behalf of the Company or any Subsidiary in connection with the transactions contemplated by this Agreement
contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements made herein or therein, in the light of the circumstances under which they were made herein or therein, not misleading.

 
(p) BOOKS AND RECORDS; INTERNAL ACCOUNTING
CONTROLS. The records and documents of the Company and its Subsidiaries accurately reflect in all material respects the information relating to the business of the Company and the Subsidiaries, the location and collection of their assets, and the
nature of all transactions giving rise to the obligations or accounts receivable of the Company or any Subsidiary. The Company and each of its Subsidiaries maintain a system of internal accounting controls sufficient, in the judgment of

 

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the Company’s board of
directors, to provide reasonable assurance that (i) transactions are executed in accordance with management’s general or specific authorizations, (ii) transactions are recorded as necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles and to maintain asset accountability, (iii) access to assets is permitted only in accordance with management’s general or specific authorization and (iv) the recorded accountability for
assets is compared with the existing assets at reasonable intervals and appropriate actions are taken with respect to any differences. 
 
(q) SECURITIES ACT OF 1933. The Company has complied and will comply with all applicable federal and state securities laws in connection
with the offer, issuance and sale of the Notes, the Conversion Shares hereunder. Neither the Company nor anyone acting on its behalf, directly or indirectly, has or will sell, offer to sell or solicit offers to buy any of the Securities, or similar
securities to, or solicit offers with respect thereto from, or enter into any preliminary conversations or negotiations relating thereto with, any person, or has taken or will take any action so as to bring the issuance and sale of any of the
Securities under the registration provisions of the Securities Act and applicable state securities laws. Neither the Company nor any of its affiliates, nor any person acting on its or their behalf has engaged in any form of general solicitation or
general advertising (within the meaning of Regulation D under the Securities Act) in connection with the offer or sale of any of the Securities. 
 
(r) GOVERNMENTAL APPROVALS. Except for the filing of any notice prior or subsequent to the Closing that may be required under applicable
state and/or federal securities laws (which if required, shall be filed on a timely basis), no authorization, consent, approval, license, exemption of, filing or registration with any court or governmental department, commission, board, bureau,
agency or instrumentality, domestic or foreign, is or will be necessary for, or in connection with, the execution or delivery of the Notes or for the performance by the Company of its obligations under the Transaction Documents. 
 
(s) ABSENCE OF CERTAIN DEVELOPMENTS. Since June 30, 2002,
neither the Company nor any Subsidiary has: (i) issued any stock, bonds or other corporate securities or any rights, options or warrants with respect thereto; (ii) borrowed any amount or incurred or become subject to any liabilities (absolute or
contingent) except current liabilities incurred in the ordinary course of business which are comparable in nature and amount to the current liabilities incurred in the ordinary course of business during the comparable portion of its prior fiscal
year, as adjusted to reflect the current nature and volume of the Company’s or such Subsidiary’s business; (iii) discharged or satisfied any lien or encumbrance or paid any obligation or liability (absolute or contingent), other than
current liabilities paid in the ordinary course of business; (iv) declared or made any payment or distribution of cash or other property to stockholders with respect to its stock, or purchased or redeemed, or made any agreements so to purchase or
redeem, any shares of its capital stock; (v) sold, assigned or transferred any other tangible assets, or canceled any debts or claims, except in the ordinary course of business; (vi) sold, assigned or transferred any patent rights, trade names,
copyrights, trade secrets or other intangible assets or intellectual property rights, or disclosed any proprietary confidential information to any person except in the ordinary course of business or to the Purchasers or its representatives; (vii)
suffered any substantial losses or waived any rights of material value, whether or not in the ordinary course of business, or suffered the loss of any material amount of prospective business; (viii) made any changes in employee compensation except
in the ordinary course of business and 
 

7 

 
consistent with past
practices; (ix) made capital expenditures or commitments therefor that aggregate in excess of $25,000; (x) entered into any other transaction other than in the ordinary course of business, or entered into any other material transaction, whether or
not in the ordinary course of business; (xi) made charitable contributions or pledges in excess of $25,000; (xii) suffered any material damage, destruction or casualty loss, whether or not covered by insurance; (xiii) experienced any material
problems with labor or management in connection with the terms and conditions of their employment; (xiv) effected any two or more events of the foregoing kind which in the aggregate would cause a Material Adverse Effect; or (xv) entered into an
agreement, written or otherwise (other than the Transaction Documents), to take any of the foregoing action. 
 
(t) USE OF PROCEEDS. The proceeds from the sale of the Notes will be used by the Company for working capital purposes and shall not be
used to make any loans to any officer, director, affiliate or insider of the Company. 
 
Section 2.2 REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS. Each of the Purchasers hereby makes the following representations and warranties to the Company with respect solely to itself and not with respect
to any other Purchaser: 
 
(a) ORGANIZATION AND
STANDING OF THE PURCHASERS. If the Purchaser is an entity, such Purchaser is a corporation, limited liability company or partnership duly incorporated or organized, validly existing and in good standing under the laws of the jurisdiction of its
incorporation or organization. 
 
(b) AUTHORIZATION
AND POWER. Each Purchaser has the requisite power and authority to enter into and perform the Transaction Documents and to purchase the Notes being sold to it hereunder. The execution, delivery and performance of the Transaction Documents by each
Purchaser and the consummation by it of the transactions contemplated hereby have been duly authorized by all necessary corporate or partnership action, and no further consent or authorization of such Purchaser or its Board of Directors,
stockholders, or partners, as the case may be, is required. This Agreement has been duly authorized, executed and delivered by each Purchaser. The other Transaction Documents constitute, or shall constitute when executed and delivered, valid and
binding obligations of each Purchaser enforceable against such Purchaser in accordance with their terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, liquidation, conservatorship,
receivership or similar laws relating to, or affecting generally the enforcement of, creditors rights and remedies or by other equitable principles of general application. 
 
(c) ACQUISITION FOR INVESTMENT. Each Purchaser is purchasing the Notes solely for its own account for the
purpose of investment and not with a view to or for sale in connection with a distribution. Each Purchaser does not have a present intention to sell any of the Securities, nor a present arrangement (whether or not legally binding) or intention to
effect any distribution of any of the Securities to or through any person or entity; provided, however, that by making the representations herein and subject to SECTION 2.2(e) below, each Purchaser does not agree to hold any of the Securities for
any minimum or other specific term and reserves the right to dispose of any of the Securities at any time in accordance with federal and state securities laws applicable to such disposition. Each Purchaser acknowledges that it (i) has such

 

8 

 
knowledge and experience in
financial and business matters such that Purchaser is capable of evaluating the merits and risks of Purchaser’s investment in the Company and is (ii) able to bear the financial risks associated with an investment in the Securities and (iii)
that it has been given full access to such records of the Company and the Subsidiaries and to the officers of the Company and the Subsidiaries as it has deemed necessary or appropriate to conduct its due diligence investigation. 
 
(d) RULE 144. Each Purchaser understands that the Securities
must be held indefinitely unless such Securities are registered under the Securities Act or an exemption from registration is available. Each Purchaser acknowledges that such person is familiar with Rule 144 of the rules and regulations of the
Commission, as amended, promulgated pursuant to the Securities Act (“RULE 144”), and that such Purchaser has been advised that Rule 144 permits resales only under certain circumstances. Each Purchaser understands that to the extent that
Rule 144 is not available, such Purchaser will be unable to sell any Securities without either registration under the Securities Act or the existence of another exemption from such registration requirement. 
 
(e) GENERAL. Each Purchaser understands that the Securities
are being offered and sold in reliance on a transactional exemption from the registration requirements of federal and state securities laws and the Company is relying upon the truth and accuracy of the representations, warranties, agreements,
acknowledgments and understandings of such Purchaser set forth herein in other to determine the applicability of such exemptions and the suitability of such Purchaser to acquire the Securities. Each Purchaser understands that no United States
federal or state agency or any government or governmental agency has passed upon or made any recommendation or endorsement of the Securities. 
 
(f) OPPORTUNITIES FOR ADDITIONAL INFORMATION. Each Purchaser acknowledges that such Purchaser has had the opportunity to ask questions of
and receive answers from, or obtain additional information from, the executive officers of the Company concerning the financial and other affairs of the Company, and to the extent deemed necessary in light of such Purchaser’s personal knowledge
of the Company’s affairs, such Purchaser has asked such questions and received answers to the full satisfaction of such Purchaser, and such Purchaser desires to invest in the Company. 
 
(g) NO GENERAL SOLICITATION. Each Purchaser acknowledges that the Securities were not offered to such
Purchaser by means of any form of general or public solicitation or general advertising or publicly disseminated advertisements or sales literature, including (i) any advertisement, article, notice or other communication published in any newspaper,
magazine, or similar media, or broadcast over television or radio, or (ii) any seminar or meeting to which such Purchaser was invited by any of the foregoing means of communications. 
 

9 

 
ARTICLE III

 
COVENANTS 
 
The Company covenants with each Purchaser as follows, which covenants are for
the benefit of each Purchaser and their respective permitted assignees: 
 
Section 3.1 SECURITIES COMPLIANCE. The Company, if required, shall notify the Commission in accordance with their rules and regulations, of the transactions contemplated by any of the Transaction Documents and shall
take all other necessary action and proceedings as may be required and permitted by applicable law, rule and regulation, for the legal and valid issuance of the Securities to the Purchasers, or their respective subsequent holders. 
 
Section 3.2 COMPLIANCE WITH LAWS. The Company shall comply, and
cause each Subsidiary to comply, with all applicable laws, rules, regulations and orders, noncompliance with which the Company reasonably expects would have a Material Adverse Effect. 
 
Section 3.3 KEEPING OF RECORDS AND BOOKS OF ACCOUNT. The Company shall keep and cause each Subsidiary to keep
adequate records and books of account, in which complete entries will be made in accordance with GAAP consistently applied, reflecting all financial transactions of the Company and its Subsidiaries, and in which, for each fiscal year, all proper
reserves for depreciation, depletion, obsolescence, amortization, taxes, bad debts and other purposes in connection with its business shall be made. 
 
Section 3.4 REPORTING REQUIREMENTS. The Company, upon request by the Purchaser, shall furnish one (1) copy of the following to the
Purchasers in a timely manner so long as the Purchasers shall be obligated hereunder to purchase the Notes or shall beneficially own the Notes: (a) Quarterly Reports filed with the Commission on Form 10-QSB as soon as available, and in any event
within fifty-one (51) days after the end of each of the first three (3) fiscal quarters of the Company; (b) Annual Reports filed with the Commission on Form 10-KSB as soon as available, and in any event within one hundred six (106) days after the
end of each fiscal year of the Company; and (c) copies of all notices and information, including without limitation notices and proxy statements in connection with any meetings, that are provided to holders of shares of Common Stock,
contemporaneously with the delivery of such notices or information to such holders of Common Stock. 
 
Section 3.5 AMENDMENTS. The Company shall not amend or waive any provision of the Articles or Bylaws of the Company in any way that would adversely affect the exercise rights, voting
rights, prepayment rights or redemption rights of the holder of the Notes provided, however, that the Company shall not be prohibited from amending its Articles to increase its authorized capital stock. 
 
Section 3.6 OTHER AGREEMENTS. The Company shall not enter into
any agreement in which the terms of such agreement would restrict or impair the right or ability to perform of the Company or any Subsidiary under any Transaction Document. 
 

10 

 
Section 3.7
DISTRIBUTIONS. So long as any Notes remain outstanding, the Company agrees that it shall not, without the prior written consent of the holders of a majority of the principal amount of the Notes outstanding at the time consent is required,
which consent may be granted or denied in the sole discretion of the Purchasers (i) declare or pay any dividends (other than a stock dividend or stock split) or make any distributions to any holder(s) of Common Stock or (ii) purchase or otherwise
acquire for value, directly or indirectly, any Common Stock or other equity security of the Company. 
 
Section 3.8 RESERVATION OF SHARES. So long as the Notes remain outstanding, the Company shall take all action necessary to at all times have authorized, and reserved for the purpose of
issuance (subject to Shareholder Approval if required), 100% of the aggregate number of shares of Common Stock issuable at a conversion price equal to the Conversion Price (as defined in the Notes). If at any time the number of shares of Common
Stock authorized and reserved for issuance is below 100% of the Conversion Price (as defined in the Notes), the Company will promptly take all corporate action necessary to authorize and reserve a sufficient number of shares, including without
limitation, calling a special meeting of shareholders to authorize additional shares to meet the Company’s obligations under this SECTION 3.8, in the case of an insufficient number of authorized shares, and using its best efforts to obtain
shareholders’ approval of an increase in such authorized number of shares. 
 
Section 3.9 DISPOSITION OF ASSETS. So long as the Notes remain outstanding, neither the Company nor any Subsidiary shall sell, transfer or otherwise dispose of any material amount of its properties, assets and rights
including, without limitation, its intellectual property, to any person except for sales in the ordinary course of business, without the prior written consent of the holders of a majority of the principal amount of the NOTES then outstanding.

 
Section 3.10 SUBSEQUENT EQUITY FINANCINGS. So long
as the Notes remain outstanding, upon the Company completing any equity financing for cash, the Company shall escrow 30% of the net equity proceeds for the benefit of the Purchasers (“EQUITY PROCEEDS”). On the due date of the Notes, the
Company will distribute the Equity Proceeds as payment on the Notes to the Purchasers, on a pro rata basis, to the total Notes outstanding. 
 
ARTICLE IV 
 
CONDITIONS 
 
Section 4.1 CONDITIONS PRECEDENT TO THE OBLIGATION OF THE COMPANY TO CLOSE AND TO SELL THE NOTES. The obligation hereunder of the Company to
close and issue and sell the Notes to the Purchasers at the Closing Date is subject to the satisfaction or waiver, at or before the Closing of the conditions set forth below. These conditions are for the Company’s sole benefit and may be waived
by the Company in writing at any time in its sole discretion. 
 
(a) ACCURACY OF THE PURCHASERS’ REPRESENTATIONS AND WARRANTIES. The representations and warranties of each Purchaser shall be true and correct in all material respects as of the date when made and as of the Closing Date as
though made at that time, except for representations and warranties that are expressly 
 

11 

made as of a particular date, which shall be true and correct in all material respects as
of such date. 
 
(b) PERFORMANCE BY THE
PURCHASERS. Each Purchaser shall have performed, satisfied and complied in all respects with all covenants, agreements and conditions required by this Agreement to be performed, satisfied or complied with by the Purchasers at or prior to the Closing
Date. 
 
(c) NO INJUNCTION. No statute, rule,
regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated or endorsed by any court or governmental authority of competent jurisdiction which prohibits the consummation of any of the transactions
contemplated by this Agreement. 
 
(d) DELIVERY OF
PURCHASE PRICE. The Purchase Price for the Notes has been delivered to the Company at the Closing Date. 
 
(e) DELIVERY OF TRANSACTION DOCUMENTS. The Transaction Documents have been duly executed and delivered by the Purchasers to the Company,
and the Company shall have received such other certificates and documents as the Company or its counsel shall reasonably require incident to the Closing. 
 
Section 4.2 CONDITIONS PRECEDENT TO THE OBLIGATION OF THE PURCHASERS TO CLOSE AND TO PURCHASE THE NOTES. The obligation hereunder of the
Purchasers to purchase the Notes and consummate the transactions contemplated by this Agreement is subject to the satisfaction or waiver, at or before the Closing Date, of each of the conditions set forth below. These conditions are for the
Purchasers’ sole benefit and may be waived by the Purchasers at any time in their sole discretion. 
 
(a) ACCURACY OF THE COMPANY’S REPRESENTATIONS AND WARRANTIES. Each of the representations and warranties of the Company in this
Agreement, the Security Agreement and the Notes shall be true and correct in all material respects as of the Closing Date except for representations and warranties that speak as of a particular date, which shall be true and correct in all material
respects as of such date. 
 
(b) PERFORMANCE BY THE
COMPANY. The Company shall have performed, satisfied and complied in all respects with all covenants, agreements and conditions required by this Agreement to be performed, satisfied or complied with by the Company at or prior to the Closing Date.

 
(c) NO INJUNCTION. No statute, rule, regulation,
executive order, decree, ruling or injunction shall have been enacted, entered, promulgated or endorsed by any court or governmental authority of competent jurisdiction which prohibits the consummation of any of the transactions contemplated by this
Agreement. 
 
(d) NO PROCEEDINGS OR LITIGATION. No
action, suit or proceeding before any arbitrator or any governmental authority shall have been commenced, and no investigation by any governmental authority shall have been threatened, against the Company or any Subsidiary, or any of the officers,
directors or affiliates of the Company or any Subsidiary 
 

12 

 
seeking to restrain, prevent
or change the transactions contemplated by this Agreement, or seeking damages in connection with such transactions. 
 
(e) NOTES. The Company shall have delivered the originally executed Notes (in such denominations as each Purchaser may request) to the
Purchasers that are being acquired by the Purchasers at the Closing. 
 
(f) RESOLUTIONS. The Board of Directors of the Company shall have adopted resolutions consistent with SECTION 2.1(b) hereof (the “RESOLUTIONS”). 
 
(g) SECURITY AGREEMENT. As of the Closing Date, the parties shall have entered into the security agreement in
the form of EXHIBIT “C” attached hereto. 
 
(h) FEES AND EXPENSES. As of the Closing Date, all fees and expenses required to be paid by the Company shall have been or authorized to be paid by the Company as of the Closing Date. 
 
(i) MATERIAL ADVERSE EFFECT. No Material Adverse Effect shall
have occurred. 
 
ARTICLE V 
 
CERTIFICATE LEGEND 
 
Section 5.1 LEGEND. Each certificate representing the Notes, the
Conversion Shares, shall be stamped or otherwise imprinted with a legend substantially in the following form (in addition to any legend required by applicable state securities or “BLUE SKY” laws): 
 
THE SECURITIES REPRESENTED BY THIS CERTIFICATE (THE “SECURITIES”)
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”) OR ANY STATE SECURITIES LAWS AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS REGISTERED UNDER THE SECURITIES ACT AND UNDER
APPLICABLE STATE SECURITIES LAWS OR TEAM SPORTS ENTERTAINMENT, INC. SHALL HAVE RECEIVED AN OPINION OF ITS COUNSEL THAT REGISTRATION OF SUCH SECURITIES UNDER THE SECURITIES ACT AND UNDER THE PROVISIONS OF APPLICABLE STATE SECURITIES LAWS IS NOT
REQUIRED. 
 
The Company agrees to reissue certificates
representing any of the Securities, without the legend set forth above if at such time, prior to making any transfer of any such Securities, such holder thereof shall give written notice to the Company describing the manner and terms of such
transfer and removal as the Company may reasonably request. Such proposed transfer will not be effected until: (a) the Company has notified such holder that either (i) in the opinion of Company counsel, the registration of the Notes, Conversion
Shares, under the Securities Act is not required in connection with such proposed transfer; or (ii) a registration statement under the Securities Act covering such proposed disposition has been filed by the Company with the Commission and has become
effective under the Securities Act; and (b) the Company has notified such holder that either (i) in the opinion of Company counsel, the registration or 
 

13 

 
qualification under the
securities or “BLUE SKY” laws of any state is not required in connection with such proposed disposition, or (ii) compliance with applicable state securities or “BLUE SKY” laws has been effected. The Company will use its best
efforts to respond to any such notice from a holder within five (5) days. In the case of any proposed transfer under this SECTION 5, the Company will use reasonable efforts to comply with any such applicable state securities or “BLUE SKY”
laws, but shall in no event be required, in connection therewith, to qualify to do business in any state where it is not then qualified or to take any action that would subject it to tax or to the general service of process in any state where it is
not then subject. The restrictions on transfer contained in SECTION 5.1 shall be in addition to, and not by way of limitation of, any other restrictions on transfer contained in any other section of this Agreement. 
 
ARTICLE VI 
 
TERMINATION 
 
Section 6.1 TERMINATION BY MUTUAL CONSENT. This Agreement may be
terminated at any time prior to the Closing Date by the mutual written consent of the Company and the Purchasers. 
 
Section 6.2 EFFECT OF TERMINATION. If this Agreement is terminated as provided in SECTION 6.1 herein, this Agreement shall become void and
of no further force and effect, except for SECTIONS 8.1 AND 8.2, and ARTICLE VII herein. Nothing in this SECTION 6.2 shall be deemed to release the Company or any Purchaser from any liability for any breach under this Agreement, or to impair the
rights of the Company and such Purchaser to compel specific performance by the other patty of its obligations under this Agreement. 
 
ARTICLE VII 
 
INDEMNIFICATION 
 
Section 7.1 GENERAL INDEMNITY. The Company agrees to indemnify and hold harmless each Purchaser (and its respective directors, officers,
affiliates, agents, successors and assigns) from and against any and all losses, liabilities, deficiencies, costs, damages and expenses (including, without limitation, reasonable attorneys’ fees, charges and disbursements) incurred by each
Purchaser as a result of any inaccuracy in or breach of the representations, warranties or covenants made by the Company herein. The Purchasers severally but not jointly agree to indemnify and hold harmless the Company and its directors, officers,
affiliates, agents, successors and assigns from and against any and all losses, liabilities, deficiencies, costs, damages and expenses (including, without limitation, reasonable attorneys’ fees, charges and disbursements) incurred by the
Company as a result of any inaccuracy in or breach of the representations, warranties or covenants made by the Purchasers herein. 
 
Section 7.2 INDEMNIFICATION PROCEDURE. Any party entitled to indemnification under this ARTICLE VII (an “INDEMNIFIED PARTY”) will
give written notice to the indemnifying party of any matters giving rise to a claim for indemnification; provided, that the failure of any party entitled to indemnification hereunder to give notice as provided herein shall not relieve the
indemnifying party of its obligations under this ARTICLE VII except to the 
 

14 

 
extent that the indemnifying
party is actually prejudiced by such failure to give notice. In case any action, proceeding or claim is brought against an indemnified party in respect of which indemnification is sought hereunder, the indemnifying party shall be entitled to
participate in and, unless in the reasonable judgment of the indemnified party a conflict of interest between it and the indemnifying party may exist with respect to such action, proceeding or claim, to assume the defense thereof with counsel
reasonably satisfactory to the indemnified party. In the event that the indemnifying party advises an indemnified party that it will contest such a claim for indemnification hereunder, or fails, within thirty (30) days of receipt of any
indemnification notice to notify, in writing, such person of its election to defend, settle or compromise, at its sole cost and expense, any action, proceeding or claim (or discontinues its defense at any time after it commences such defense), then
the indemnified party may, at its option, defend, settle or otherwise compromise or pay such action or claim. In any event, unless and until the indemnifying party elects in writing to assume and does so assume the defense of any such claim,
proceeding or action, the indemnified party’s costs and expenses arising out of the defense, settlement or compromise of any such action, claim or proceeding shall be losses subject to indemnification hereunder. The indemnified party shall
cooperate fully with the indemnifying party in connection with any negotiation or defense of any such action or claim by the indemnifying party and shall furnish to the indemnifying party all information reasonably available to the indemnified party
which relates to such action or claim. The indemnified party shall keep the indemnified party fully apprised at all times as to the status of the defense or any settlement negotiations with respect thereto. If the indemnifying party elects to defend
any such action or claim, then the indemnified party shall be entitled to participate in such defense with counsel of its choice at its sole cost and expense. The indemnifying party shall not be liable for any settlement of any action, claim or
proceeding effected without its prior written consent. Notwithstanding anything in this ARTICLE VII to the contrary, the indemnifying party shall not, without the indemnified party’s prior written consent, settle or compromise any claim or
consent to entry of any judgment in respect thereof which imposes any future obligation on the indemnified party or which does not include, as an unconditional term thereof, the giving by the claimant or the plaintiff to the indemnified party of a
release from all liability in respect of such claim. The indemnification required by this ARTICLE VII shall be made by periodic payments of the amount thereof during the course of investigation or defense, as and when bills are received or expense,
loss, damage or liability is incurred, so long as the indemnified party irrevocably agrees to refund such moneys if it is ultimately determined by a court of competent jurisdiction that such party was not entitled to indemnification. The indemnity
agreements contained herein shall be in addition to (a) any cause of action or similar rights of the indemnified party against the indemnifying party or others, and (b) any liabilities the indemnifying party may be subject to pursuant to the law.

 
ARTICLE VIII 
 
MISCELLANEOUS 
 
Section 8.1 FEES AND EXPENSES. Each party shall pay the fees and
expenses of its advisors, counsel, accountants and other experts, if any, and all other expenses, incurred by such party incident to the negotiation, preparation, execution, delivery and performance of this Agreement, provided, however, that the
Company shall pay such fees and expenses set forth on SCHEDULE 2.1(n) hereto. 
 

15 

 
Section 8.2 SPECIFIC
ENFORCEMENT; CONSENT TO JURISDICTION. (a) The Company and the Purchasers acknowledge and agree that irreparable damage would occur in the event that any of the provisions of this Agreement or the other Transaction Documents were not performed in
accordance with their specific terms or were otherwise breached. It is accordingly agreed that the parties shall be entitled to an injunction or injunctions to prevent or cure breaches of the provisions of this Agreement or the other Transaction
Documents and to enforce specifically the terms and provisions hereof or thereof, this being in addition to any other remedy to which any of them may be entitled by law or equity. (b) The Company and each Purchaser (i) hereby irrevocably submit to
the exclusive jurisdiction of the United States District Court sitting in the District of North Carolina and the courts of the State of North Carolina located in Mecklenburg County for the purposes of any suit, action or proceeding arising out of or
relating to this Agreement or any of the other Transaction Documents or the transactions contemplated hereby or thereby and (ii) hereby waive, and agree not to assert in any such suit, action or proceeding, any claim that it is not personally
subject to the jurisdiction of such court, that the suit, action or proceeding is brought in an inconvenient forum or that the venue of the suit, action or proceeding is improper. The Company and each Purchaser consent to process being served in any
such suit, action or proceeding by mailing via certified mail, return receipt requested, a copy thereof to such party at the address in effect for notices to it under this Agreement and agrees that such service shall constitute good and sufficient
service of process and notice thereof. Nothing in this SECTION 8.2 shall affect or limit any right to serve process in any other manner permitted by law. 
 
Section 8.3 ENTIRE AGREEMENT; AMENDMENT. This Agreement and the Transaction Documents contain the entire understanding and agreement of the
parties with respect to the matters covered hereby and, except as specifically set forth herein or in the other Transaction Documents, neither the Company nor any Purchaser make any representation, warranty, covenant or undertaking with respect to
such matters, and they supersede all prior understandings and agreements with respect to said subject matters, all of which are merged herein. No provision of this Agreement may be waived or amended other than by a written instrument signed by the
Company and the holders of at least a majority of the principal amount of the Notes then outstanding, and no provision hereof may be waived other than by a written instrument signed by the party against whom enforcement of any such amendment or
waiver is sought. No such amendment shall be effective to the extent that it applies to less than all of the holders of the Notes then outstanding. No consideration shall be offered or paid to any person to amend or consent to a waiver or
modification of any provision of any of the Transaction Documents unless the same consideration is also offered to all of the parties to the Transaction Documents or holders of Notes, as the case may be. 
 
Section 8.4 NOTICES. Any notice, demand, request, waiver or
other communication required or permitted to be given hereunder shall be in writing and shall be effective (a) upon hand delivery by telecopy or facsimile at the address or number designated below (if delivered on a business day during normal
business hours where such notice is to be received), or the first business day following such delivery (if delivered other than on a business day during normal business hours where such notice is to be received) or (b) on the second business day
following the date of mailing by express courier service, fully prepaid, addressed to such address, or upon actual receipt of such mailing, whichever shall first occur. The addresses for such communications shall be: If to the Company: TEAM SPORTS
ENTERTAINMENT, INC. 
 

16 

 
Attention: Terry Hansen,
President. If to any Purchaser: at the address of such Purchaser set forth on EXHIBIT A to this Agreement. Any party hereto may from time to time change its address for notices by giving at least ten (10) days written notice of such changed address
to the other parties hereto. 
 
Section 8.5 WAIVERS.
No waiver by either party of any default with respect to any provision, condition or requirement of this Agreement shall be deemed to be a continuing waiver in the future or a waiver of any other provision, condition or requirement hereof, nor shall
any delay or omission of any party to exercise any right hereunder in any manner impair the exercise of any such right accruing to it thereafter. 
 
Section 8.6 HEADINGS. The article, section and subsection headings in this Agreement are for convenience only and shall not constitute a
part of this Agreement for any other purpose and shall not be deemed to limit or affect any of the provisions hereof. 
 
Section 8.7 SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and inure to the benefit of the parties and their successors and
assigns. After the Closing, the assignment by a party to this Agreement of any rights hereunder shall not affect the obligations of such party under this Agreement. Subject to applicable federal and state securities laws, the Purchasers may assign
the Notes, the Warrants and their rights under this Agreement and the other Transaction Documents and any other rights hereto and thereto without the consent of the Company; provided, however, that any assignee shall first provide the Company with
duly executed representations and warranties in the form contained in SECTION 2.2 of this Agreement. 
 
Section 8.8 NO THIRD PARTY BENEFICIARIES. This Agreement is intended for the benefit of the parties hereto and their respective permitted successors and assigns and is not for the benefit
of, nor may any provision hereof be enforced by, any other person. 
 
Section 8.9 GOVERNING LAW. This Agreement shall be governed by and construed in accordance with the internal laws of the State of North Carolina, without giving effect to the choice of law provisions. This Agreement
shall not be interpreted or construed with any presumption against the party causing this Agreement to be drafted. 
 
Section 8.10 SURVIVAL. The representations and warranties of the Company and the Purchasers contained in SECTION 2.1(m) should survive until
the expiration of the applicable statutes of limitation, and those contained in ARTICLE II, with the exception of SECTION 2.1(m), shall survive the execution and delivery hereof and the Closing until the date three (3) years from the Closing Date,
and the agreements and covenants set forth in ARTICLES I, III, V, VII AND VIII of this Agreement shall survive the execution and delivery hereof and the Closing hereunder. 
 
Section 8.11 COUNTERPARTS. This Agreement may be executed in any number of counterparts, all of which taken
together shall constitute one and the same instrument and shall become effective when counterparts have been signed by each party and delivered to the other parties hereto, it being understood that all parties need not sign the same counterpart.

 

17 

 
Section 8.12
PUBLICITY. The Company agrees that it will not disclose, and will not include in any public announcement, the names of the Purchasers without the consent of the Purchasers, which consent shall not be unreasonably withheld or delayed, or
unless and until such disclosure is required by law, rule or applicable regulation, and then only to the extent of such requirement. 
 
Section 8.13 SEVERABILITY. The provisions of this Agreement are severable and, in the event that any court of competent jurisdiction shall
determine that any one or more of the provisions or part of the provisions contained in this Agreement shall, for any reason, be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not
affect any other provision or part of a provision of this Agreement and this Agreement shall be reformed and construed as if such invalid or illegal or unenforceable provision, or part of such provision, had never been contained herein, so that such
provisions would be valid, legal and enforceable to the maximum extent possible. 
 
Section 8.14 FURTHER ASSURANCES. From and after the date of this Agreement, upon the request of the Purchasers or the Company, the Company and each Purchaser shall execute and deliver such instruments, documents and
other writings as may be reasonably necessary or desirable to confirm and carry out and to effectuate fully the intent and purposes of this Agreement, the Notes, the Warrants, the Security Agreement and the Registration Rights Agreement.

 
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 

18 

 
IN WITNESS
WHEREOF, the parties hereto have caused this Agreement to be duly executed by their respective authorized officers as of the date first above written. 
 

	 COMPANY

	
	 TEAM SPORTS ENTERTAINMENT,
INC.

	
	 By:
	 	

	 	 	 Terry Hanson, President

	
	 PURCHASERS

	
	 By:
	 	

	 	 	 Print Name:
	 	

	 	 	 	 	 
	
	 By:
	 	

	 	 	 Print Name:
	 	

	 	 	 	 	 
	
	 By:
	 	

	 	 	 Print Name:
	 	

 

19 

 
SCHEDULE
2.1(c) 
OUTSTANDING OPTIONS 
 

20 

 
TEAM SPORTS ENTERTAINMENT, INC. 
OPTION LIST 
AS OF AUGUST 30, 2002 
 

	 Name

	  	 Position

	  	 Shares

	  	 Price

	  	 Date Exercisable

	 
	 Miller, William
	  	 Director
	  	 500,000
 2,500,000
	  	 $
 $
	 1.000
 0.350
	  	 12/1/2001
 12/1/2001
	  
  

	 Washburn, Terry
	  	 Director
	  	 150,000
 500,000
	  	 $
 $
	 0.375
 1.000
	  	 5/15/2001
 12/12/2001
	  
  

	 Pritchett, Jon
	  	 Director
 Employee
	  	 500,000
 166,666
 166,667
	  	 $
 $
 $
	 1.000
 1.000
 1.000
	  	 12/12/2001
 9/1/2001
 3/1/2002
	  
  
  

	 Durschlag, Maurice
	  	 Advisory Director
 Employee
	  	 250,000
 83,333
 83,333
 83,334
	  	 $
 $
 $
 $
	 1.000
 1.000
 1.000
 1.000
	  	 12/12/2001
 8/1/2001
 12/1/2001
 8/1/2002
	  
  
  
  

	 Jeter, Charles
	  	 Employee
	  	 83,333
 83,333
 83,334
	  	 $
 $
 $
	 1.000
 1.000
 1.000
	  	 10/1/2001
 4/1/2002
 4/1/2003
	  
  
 **

	 Wussler, Robert
	  	 Director
	  	 500,000
 1,000,000
	  	 $
 $
	 1.000
 0.375
	  	 12/12/2001
	  

	 Campbell, Carroll
	  	 Director
	  	 500,000
	  	 $
	 1.000
	  	 12/12/2001
	  

	 Yarborough, Cale
	  	 Director
	  	 500,000
	  	 $
	 1.000
	  	 12/12/2001
	  

	 Ford, Danny
	  	 Director
	  	 500,000
	  	 $
	 1.000
	  	 12/12/2001
	  

	 Bradshaw, Charles
	  	 Director
	  	 500,000
	  	 $
	 1.000
	  	 12/12/2001
	  

	 Starke, Wendell
	  	 Advisory Director
	  	 250,000
	  	 $
	 1.000
	  	 12/12/2001
	  

	 Jarvie, Charles
	  	 Advisory Director
	  	 250,000
	  	 $
	 1.000
	  	 12/12/2001
	  

	 Jones, Hank
	  	 Advisory Director
	  	 250,000
	  	 $
	 1.000
	  	 12/12/2001
	  

	 Scheer, Carl
	  	 Advisory Director
	  	 250,000
	  	 $
	 1.000
	  	 12/12/2001
	  

	 Klompmaker, Jay
	  	 Advisory Director
	  	 250,000
	  	 $
	 1.000
	  	 12/12/2001
	  

	 Godley, Johnny
	  	 Advisory Director
	  	 250,000
	  	 $
	 1.000
	  	 12/12/2001
	  

	 	  	 	  	
	  	 	 	  	 	 
	 	  	 	  	 10,233,333
	  	 	 	  	 	 
	 	  	 	  	
	  	 	 	  	 	 
	 **Certain circumstances could accelerate the vesting date.
	  	 	  	 	  	 	 	  	 	 
	 Warrants
	  	 	  	 14,488,500
	  	 $
	 1.000
	  	 	 

 

21 

 
SCHEDULE
2.1(g) 
 
SUBSIDIARY 
 
Team Racing Auto Circuit, LLC, a Delaware Limited Liability
Corporation 
 

22 

 
SCHEDULE
2.1(n) 
 
Each Purchaser shall be entitled to a loan
origination fee equal to 10% of the total Note purchased (“Origination Fee”). At the option of the Company, the Origination Fee may be paid by the Company by delivering four (4) shares of the Company’s Common Stock for every $1.00
owed in Origination Fees. The Common Shares delivered shall be subject to applicable 144 restrictions and will carry no registration rights. 
 

23

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00050-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00050-of-00352.parquet"}]]