Document:

ex-10.1

  WALABOT-HOME RESELLER AGREEMENT
  
 This Walabot-HOME Reseller Agreement (“Agreement”) is made and entered into as of this 31 day of July 2019 (“Effective Date”) by and between Vayyar Imaging Ltd., having its principal place of business at 3 Avraham Giron St., POB. 325, Yehud 5621717, Israel (“Supplier”), and Inde Living Holdings, Inc., having its principal place of business at 1462 Rudder Lane, Knoxville, TN 37919 (“Reseller”). Vayyar and Reseller shall be referred to individually as “Party” and collectively as “Parties”.
 1.
 1.Definitions. The following capitalized terms shall have the following meanings: 
 1.1.“Customer” means a third party who purchases the Products from Reseller within the Territory, for its internal use only (including for the personal use of its End Users), such as nursing homes. 
 1.2.“End User” means a third party who is a customer of Customer or is otherwise related to a customer of Customer, and who purchases and/or uses the Products within the Territory, for its personal use only.  
 1.3.“End User Agreement” means Supplier’s standard license agreements, which are available at https://walabot.com/walabot-home, which governs each End User’s right to use the Product, as amended by Supplier in its sole discretion from time to time. 
 1.4.“MOQ” means the minimum order quantity of Product units during the Initial Term, as set forth in Schedule 1. 
 1.5.***. 
 1.6.“Order” means a written purchase order for Products to be purchased by the Reseller. 
 1.7.“Products” means the products listed in Schedule 1. 
 1.8.“Software” means Supplier’s proprietary software components, included as part of the Products, including all improvements, corrections, updates, upgrades and any related documentation and derivatives thereof. 
 1.9.“Territory” means the countries and/or territories listed in Schedule 1.  
 2.Appointment 
 2.1.During the Term (defined below) and subject to the terms and conditions of this Agreement (including, but not limited to Section 12.4 hereof), Supplier hereby (i) appoints Reseller, and Reseller accepts the appointment, as a non-exclusive reseller of the Products in the Territory. In connection with the foregoing appointment, Supplier hereby grants Reseller a non-transferable, revocable, limited right to resell, market, promote, stimulate interest in, and solicit Orders by Customers and/or End Users in the Territory for the Products and to provide services in connection with those activities. Reseller shall be solely responsible for all of its costs and expenses related to the resale of the Products. Notwithstanding anything to the contrary, Supplier reserves any and all rights with respect to the Products not expressly granted in this Agreement. Without limiting the right of the Reseller to receive any and all Paid-For Products (including but not limited to under Section 4.2 hereof), nothing in this Agreement shall entitle the Reseller to any priority of supply in relation to the Products as against any other distributor or customer of the Supplier. “Paid-For Products” means Products for which Reseller submitted an Order, had that Order accepted by Supplier, and for which Reseller has remitted payment in full to the Supplier under this Agreement. Subject to the terms of Section 13, below, it is hereby clarified that Supplier may, in its sole discretion, sell the Products to any other person or entity, whether within the Territory or otherwise.  
 2.2.***.  
 2.3.***.  
 2.4.***.  
 3.Obligations of Reseller 
 3.1.By fulfilling its obligations under this Agreement, the Reseller shall: (i) comply with all applicable laws and regulations; (ii) use materials and branding solely as determined by the Supplier (subject to the right of the Reseller to make changes to such materials as are described in Section 2.4); (iii) attend training and sales meetings as required by the Supplier, so as to be able to describe, demonstrate, and sell the Products adequately; (iv) make sure that all the End Users are signing the End User Agreement, and in the event that any End User does not comply with these terms, Reseller shall bear all liability associated with said End User; and (v) make no representations or warranties with respect to the Products other than those provided in the Products’ documentation;  
 3.2.Supplier shall be fully responsible for shipping the Products to the Reseller at the address of the Reseller specified in each Order (or as otherwise communicated by Reseller to Supplier under this Agreement) and will obtain and provide for itself and/or on behalf of Reseller, any and all registrations, licenses, permits, certificates and all other documentation and information required for the exportation, importation, storage, marketing and otherwise resale of the Products in the Territory. For such process, Supplier will allocate the additional cost on a pre-agreed per Product unit additional price basis, which will be subject to an increase (subject to changes in taxes). Reseller agrees to reimburse Supplier for the reasonable out of pocket costs and expenses incurred by Supplier in connection with the shipment and delivery of the Products, and of obtaining the foregoing registrations, licenses, permits, certificated and other documentation, provided that Supplier submits an invoice therefore in reasonable detail (and unless and solely to the extent such reimbursements is prohibited by Section 14.9 or prohibited under other applicable laws). For the avoidance of doubt, in no way will Supplier be subject to any tax (i.e., sales tax) relating to the sale of the Products to Reseller’s Customers and/or End Users.  
 
 
 
  
 3.3.Diagnostics, Telemetric Data and Analytics. Supplier will retain access to diagnostics, telemetric data and analytics generated by the Product. The data shall be uploaded to Supplier’s Firebase server in a timely manner. A server interface will be embedded within the software package provided by the Supplier. Distributor will maintain Supplier’s interface to the server and access to such data within the Product; provided that the data and analytics to be received by the Supplier shall, in all cases, not be in violation of any applicable privacy or other law. 
 4.Orders, Payment and Delivery 
 4.1.***.  
 4.2.If Reseller fails to submit Orders with an aggregate value equal to or greater than the MOQ, then Reseller shall pay Supplier a sum equal to the shortfall, within 30 days after the end of the Initial Term. Upon payment of such amount, Seller shall deliver the Products paid for to Reseller in a commercially reasonable timeframe (and in no event any later than 150 days from the date such payment is received in full) to be sold by Reseller in accordance with this Agreement as contemplated by the last sentence of Section 12.4.  
 4.3.Reseller shall place its Orders by email, at the email address set out in Schedule 1. Each Order shall detail the total order quantity of the Product and the requested date of delivery (taking into consideration up to 4 months lead time). Within 5 business days following the receipt of each Order, Supplier shall acknowledge receipt of such Order. No Order shall be binding upon Supplier until such written acknowledgment was sent by Supplier to Reseller; provided that Supplier shall confirm or reject such Orders at its discretion.  
 4.4.***.  
 5.Packaging, Samples and Transportation 
 5.1.Immediately upon delivery of the Products at the Reseller’s facilities within the Territory (“Arrival Date”), Reseller shall visually inspect the Products and the appropriate documents, and employ good receiving/delivering procedures, verification of the Products to confirm origin, identity, quantity, labeled storage conditions, integrity of the packaging as well as any other inspection, as may be required by applicable laws or regulations.  
 5.2.Reseller shall ensure that the Products are delivered with appropriate information and documentation, and shall not make any changes to the Products or to the packaging or labeling thereof, or to the legal documents included in the Products’ packages, without Supplier’s prior written consent (subject to the right of the Reseller to make changes to such materials as are described in Section 2.4). Reseller shall ensure traceability of the delivered Products. 
 6.Defective Products; Warranty; Support  
 6.1.***. 
 6.2.During the Term Supplier may extend an offer to Reseller for a Returns Discount Program, whereby the Supplier will rebate a percentage of the cost of goods sold in lieu of accepting End-User returns. In the event no Returns Discount Program has been entered into by the Parties, Supplier will not accept Returned Product, except for cases of Defective Products. 
 6.3.***. 
 6.4.***. 
 7.Intellectual Property  
 7.1.Supplier shall retain all its rights and title to and ownership of all intellectual property rights in the Products including, inter alia, all documentation, enhancements, improvements or other modifications made thereof (including those modifications made in connection with Section 3.1 above), and except as expressly provided in this Agreement, Reseller shall have no right, title, or interest in any intellectual property rights in the Products. Nothing in this Section shall limit the rights of the Reseller in or to any modifications made to the Software in accordance with Section 2.3. 
 7.2.Reseller shall: (a) not do or omit to do, nor authorize any third party to do or omit to do, any act or omission that would or might invalidate or be inconsistent with any of Supplier’s intellectual property rights; (b) promptly notify Supplier of any actual, threatened, or suspected infringement of any of Supplier’s intellectual property rights that comes to Reseller’s notice; and (c) at Supplier’s request and expense, do all such things as may be reasonably required to assist Supplier in taking or resisting any proceedings in relation to any such infringement or claim. 
 8.Confidential Information. Each Party agrees that it will maintain the confidentiality of all electronic, oral, and written communications from the other Party which should reasonably be regarded in the normal commercial view, as constituting confidential information, trade secrets or proprietary information (“Confidential Information”) and use such Confidential Information only as necessary to exercise a Party’s rights or perform a Party’s obligations under this Agreement. Each Party shall: (i) safeguard and keep secret all Confidential Information, and will not directly or indirectly disclose to any third party the Confidential Information without written permission of the other; and (ii) in performing its obligations hereunder, use at least the same degree of care as it does with respect to its own confidential information of like importance but, in any event, at least reasonable care. Any information related to the Products shall be considered the Supplier’s Confidential Information. If either Party becomes legally obliged to make disclosure of the other Party’s Confidential Information, that Party shall immediately notify the first Party and reasonably cooperate with the first Party in any efforts to limit or object to the disclosure. 
  
  
 
 
  
 9.Disclaimer of Warranties. UNLESS SPECIFIED OTHERWISE HEREIN (INCLUDING BUT NOT LIMITED TO THE BACK TO BACK WARRANTY SPECIFIED IN SECTION 6.5) AND WITHOUT LIMITATION TO ANY WARRANTY WHICH SUPPLIER MAY, IN ITS SOLE DISCRETION, MAKE TO ANY CUSTOMER AND/OR END USER, THE PRODUCTS ARE PROVIDED ON AN “AS IS” AND “AS AVAILABLE” BASIS, AND SUPPLIER DOES NOT MAKE ANY WARRANTIES, EXPRESS OR IMPLIED, WITH RESPECT TO THE PRODUCTS OR ITS OPERATION THEREOF, MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.  
 10.Limitation of Liability 
 10.1.TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, IN NO EVENT SHALL SUPPLIER BE LIABLE UNDER, OR OTHERWISE IN CONNECTION WITH, THIS AGREEMENT FOR: (A) ANY CONSEQUENTIAL, INDIRECT, SPECIAL, INCIDENTAL, OR PUNITIVE DAMAGES; (B) ANY LOSS OF PROFITS, LOSS OF BUSINESS, LOSS OF REVENUE, OR LOSS OF ANTICIPATED SAVINGS; (C) ANY LOSS OF, OR DAMAGE TO, DATA, REPUTATION, OR GOODWILL; AND/OR (D) THE COST OF PROCURING ANY SUBSTITUTE GOODS OR SERVICES. THE AGGREGATE LIABILITY OF SUPPLIER UNDER, OR IN CONNECTION WITH, THIS AGREEMENT SHALL BE EQUAL TO THE LESSER OF: (i) ***; AND (ii) ***. 
 10.2.THE FOREGOING EXCLUSIONS AND LIMITATIONS SHALL APPLY: (A) EVEN IF SUPPLIER HAS BEEN ADVISED, OR SHOULD HAVE BEEN AWARE, OF THE POSSIBILITY OF LOSSES OR DAMAGES; (B) EVEN IF ANY REMEDY IN THIS AGREEMENT FAILS OF ITS ESSENTIAL PURPOSE; AND (C) REGARDLESS OF THE THEORY OR BASIS OF LIABILITY (INCLUDING, WITHOUT LIMITATION, BREACH OF CONTRACT, TORT, NEGLIGENCE OR STRICT LIABILITY). 
 11.Indemnification. Reseller shall defend, indemnify and hold harmless Supplier and its employees, officers, directors, suppliers, and successors from and against any third-party claim, suit, proceeding, damages, losses and/or liability arising from or related to (i) Reseller’s breach of any provision of this Agreement; and/or (ii) Reseller’s interaction and/or relationship with any Customer and/or End User or other third party. 
 12.Term and Termination  
 12.1.This Agreement shall become effective on the Effective Date and shall remain in effect for an initial period of 1 year (“Initial Term”). Thereafter, this Agreement shall automatically be renewed for successive 1-year terms (each a “Renewal Term”, and together with the Initial Term, the “Term”). Following the Initial Term, either Party may terminate this Agreement without cause upon written notice to the other Party of at least 3 months. 
 12.2.Without derogating from any other remedies that any Party may have under the terms of this Agreement or at law, each Party shall have the right to terminate this Agreement forthwith upon the occurrence of any of the following: (i) the other Party is in material breach of its obligations hereunder and fails to remedy such breach within 30 days after being requested in writing to do so; or (ii) the other Party’s bankruptcy, insolvency, liquidation, whether voluntarily or otherwise, or if it makes an assignment for the benefit of creditors.  
 12.3.Upon any termination of this Agreement: (i) all rights granted by Supplier to Reseller under the Agreement revert to Supplier; (ii) Reseller shall transfer to Supplier all data, reports and any other information generated by Reseller in the course of performance of this Agreement; and (iii) any payment obligation which had accrued or become payable prior to the date of termination (including the payment obligation under Section 4.2) shall survive termination of this Agreement. 
 12.4.Upon termination of this Agreement, the provisions in Sections 1, 6.5, 7, 8, 9, 10, 11, 12.3, 12.4, 13 (but solely to the extent stated in the last sentence of that section), and 14 shall remain in effect as necessary to carry out the purpose of those Sections after termination. In addition to the foregoing, if, at the time of termination of this Agreement, Reseller shall have additional Product units in its inventory and is able to sell them to Customers and/or End Users (including, without limitation, any Product units for which Reseller has or is obligated to pay the Supplier the purchase price therefor but which have not yet been delivered to the Reseller by Supplier, which Supplier hereby agrees to either deliver as otherwise contemplated by this Agreement as if it had not terminated or to refund the purchase price therefor), then the licenses and appointments described in Section 2 shall remain in effect with respect to such unsold Product units (and such Section 2 shall not terminate) until the earlier of (i) the date on which the last Product in Reseller’s inventory is sold to a Customer and/or End User, or (ii) 1 year from the date of the termination of this Agreement. 
 13.***. 
 14.General 
 14.1.Supplier and/or Reseller may assign or novate this Agreement and the rights and obligations under it to any of its affiliates or upon any merger or acquisition or the sale of all or substantially all of its assets relating to the Agreement. Any purported assignment of rights in violation of this subsection is void. 
 14.2.The relationship between the Parties is that of supplier and purchaser. Reseller is an independent contractor and is not the legal representative, agent, joint venture, partner, or employee of Supplier. Reseller may describe itself as Supplier’s ‘authorized distributor’, but may not hold itself out as the Supplier’s agent. Reseller has no authority to assume or create any obligations of any kind or to make any representations or warranties, whether express or implied, on behalf of the Supplier, nor to bind the Supplier in any respect.  
 
 
 
  
 14.3.Except as to the timely payment by Reseller for the Products purchased under this Agreement, no failure or omission to carry out or observe any provision of this Agreement shall give rise to any claim by one Party against the other, or be a breach of this Agreement, if the same is caused by or arises out of circumstances beyond the reasonable control of the other Party, including technical difficulties beyond such Party’s reasonable control that delay or prevent manufacture (“Force Majeure”). However, the Parties shall endeavor to avoid, remove, or cure all such conditions as soon as is reasonably feasible. If either Party is prevented or hindered from carrying out its obligations under this Agreement due to a Force Majeure, this Agreement shall be suspended as long as the Force Majeure persists. If such period exceeds 1 month, either Party may terminate this Agreement on giving written notice to the other.  
 14.4.No failure or delay on the part of either Party to exercise any right or remedy under this Agreement shall be construed or operate as a waiver thereof, nor shall any single or partial exercise of any right or remedy preclude the further exercise of such right or remedy. 
 14.5.If any provision or part of any provision of this Agreement is found to be invalid or unenforceable for any reason, the other provisions of this Agreement shall remain in full force and effect as if the Agreement had been executed without that provision or part. 
 14.6.All notices or other communications hereunder shall be in writing and shall be given in person, by courier or by registered mail (provided that written confirmation of receipt is provided) addressed as set forth in the heading of this Agreement or such other address as any Party may designate to the other in accordance with this procedure. All communications delivered in person or by courier service shall be deemed to have been received upon delivery, shall be deemed to have been received on the business day following transmission with confirmed answer back, and all notices and other communications sent by registered mail shall be deemed to have been received within 3 business days after posting. 
 14.7.This Agreement shall be governed by the laws of the State of New York and all disputes and controversies arising out of or in connection with the Agreement shall be brought exclusively before the competent courts in New York County, New York; provided however that judgment shall be enforceable in any country and that nothing in this Section shall prevent or restrict either Party from seeking interim relief in any competent jurisdiction as it may deem fit.  
 14.8.This Agreement constitutes the entire agreement between the Supplier and the Reseller. All previous or contemporaneous agreements, proposals, understandings, and communications between the Supplier and the Reseller are replaced in their entirety by this Agreement. In entering into this Agreement, neither Party has relied on any warranties, representations, or other matters other than as set out in this Agreement. All conditions, warranties, or other terms implied by statute or common law are excluded to the fullest extent permitted by law. This Agreement may be amended only by a written instrument executed by authorized representatives of the Parties. 
 14.9.Each of Reseller and Supplier will, respectively, ensure that it and its employees, agents or affiliates, or by any independent contractors on its behalf or for its benefit, shall comply with the United States’ Foreign Corrupt Practices Act of 1977, as amended (15 U.S.C.  §§ 78dd-1 et seq.) and any analogous anti-bribery and anti-corruption law, rule, regulation that may apply to any of the transactions contemplated under this Agreement, including but not limited to in connection with the sale, resale, import, export, transportation, or shipment of the Products. Neither party to this Agreement will make any payment, directly or indirectly, of money or other assets, including but not limited to compensation derived from this Agreement or any Order placed under it, to government or political party officials, officials of international organizations, candidates for public office, or representatives of other businesses or persons acting on behalf of any of the foregoing, that would constitute a violation of any law, rule, or regulation.      
  
 IN WITNESS WHEREOF, the Parties have executed this Agreement as of the Effective Date.
  
  
 	 Vayyar Imaging Ltd.
	  
	 IndeLiving Holdings, Inc.

	  
	  
	  

	 By: /s/ Raviv Melamed
	  
	 By: /s/ Robert Forrest

	 Chief Executive Officer
	  
	 Chief Executive Officer

  
  
  
  
  
  
  
 
 
  
 Schedule 1
 Territory, Products, Price, Ordering Address, Notices
  
 	 Territory
	 USA

	 Products
	 Walabot HOME hardware device 

	 Price
	 $*** per Product unit + $*** for shipment and tax (subject to any tax changes)

	 MOQ
	 *** units

	 Address to which Orders should be sent
	 Supplier’s Ordering Email address: logistics@walabot.com 

	 Address for Notices to the Supplier
	 Vayyar Ltd.
 3 Avraham Giron St., POB. 325, 
 Yehud 5621717, 
 Israel 

	 Address for Notices to Reseller
	 Inde Living Holdings, Inc
 1462 Rudder Lane
 Knoxville, TN 37919

	 Vayyar Wire Transfer Details
	  
   ***

  
  
 Payment Terms
  
 ***Blueprint

  Exhibit 10.1

 

PEDEVCO CORP.

COMMON STOCK

SUBSCRIPTION AGREEMENT

 

Common Stock Shares

 

	
Date: May 21, 2019

	
 Full Subscription
Commitment: US$14,999,998.20

1. Subscription:

 

(a) The undersigned
purchasers who have executed a copy of the Participant signature
page hereof and delivered the Purchase Price to the Company
(collectively, the “Participants”
and each, a “Participant”)
hereby apply to purchase restricted Common Stock (the
“Common
Stock” or the “Shares”
or the “Securities”)
of PEDEVCO Corp., a Texas corporation (the “Company”),
in the amount set forth below their signature on the signature page
of this Agreement, in accordance with the terms and conditions of
this Subscription Agreement (the “Subscription”
or “Agreement”).

 

(b) Each Share has a
price per share of US$2.20
(the “Purchase
Price”, which term, depending on its context shall
also refer to the aggregate consideration due from each Participant
for the aggregate amount of Shares purchased by such Participant
hereunder).

 

(c) Before this
Subscription is considered, the Participant must complete, execute
and deliver to the Company the following:

 

(i) This
Subscription;

 

(ii) The
Certificate of Accredited Investor Status and Investor Information,
attached hereto as Exhibit A,
and

 

(iii) The
Participant’s check in the amount set forth on the signature
page hereof in the amount of the aggregate Purchase Price in
exchange for the Shares purchased, or wire transfer sent according
to the Company’s instructions.

 

(d) This Subscription
is irrevocable by the Participant.

 

(e) This Subscription
is not transferable or assignable by the Participant.

 

(f) This
Subscription may be rejected in whole or in part by the Company in
its sole discretion prior to the Closing (as defined in
Section 1(h) hereof), regardless of
whether Participant’s funds have theretofore been deposited
by the Company. Participant’s execution and delivery of this
Subscription will not constitute an agreement between the
undersigned and the Company until this Agreement has been accepted
and executed by the Company. In the event this Subscription is
rejected by the Company, all funds and documents tendered by the
Participant shall be returned and the parties’ obligations
hereunder, shall terminate.

 

(g) For purposes of
this Agreement:

 

(i) “Affiliate”
means (x) any Person directly or indirectly controlling, controlled
by or under common control with another Person, or (y) any manager,
director, officer, partner or employee of a Person; a Person shall
be deemed to control another Person if such Person possesses,
directly or indirectly, the power to direct or cause the direction
of the management and policies of such other Person, whether
through ownership of voting securities, by contract, or
otherwise.

 

(ii)  “Material
Adverse Effect” means any change, event, development
or occurrence, individually or with all other changes, events,
developments or occurrences, that has or is reasonably likely to
(a) have a material adverse effect on the business, prospects,
assets, results of operations or financial condition of the Company
or (b) prevent or materially delay consummation of the transactions
contemplated hereby or otherwise prevent the Company from
performing its obligations under this Agreement on a timely basis
in any material respect.

 

(iii)  “NYSE
American Approval” shall mean such approvals as may be
required by the NYSE American Exchange in connection with issuance
and/or listing of the Shares on the NYSE American
Exchange.

 

(iv) “Person”
means any individual, corporation, partnership, joint venture,
limited liability company, trust, unincorporated organization or
governmental entity.

  

 

1

 

  

(h) The closing (the
“Closing”)
of this offering (the “Offering”)
is scheduled to occur as soon as possible, but no later than May
21, 2019, unless extended upon mutual written agreement by the
Participants and the Company. The date that the Offering closes
shall be the “Closing
Date” for the purposes of this Agreement. 

 

(i) Conditions to
Closing. Closing shall be conditioned upon the following,
unless waived in writing by the Company and the
Participant:

 

(i) NYSE American Approval: The
Company shall have received NYSE American Approval.

 

(ii) Board
Approval: The Board of Directors of the Company shall have
approved the transactions contemplated by this Subscription and the
other transaction documents and the issuance of the Securities. The
Company shall have performed in all material respects all
obligations and covenants herein required to be performed by it on
or prior to the Closing.

 

(j) Participant hereby
agrees not to, and will cause its Affiliates not to, enter into any
“put equivalent
position” as such term is defined in Rule 16a-1 under
the Securities Exchange Act of 1934, as amended, or short sale
position with respect to the Securities either prior to Closing or
at any time that Participant holds any Shares.

 

2.   
Representations by Participant. In consideration of the
Company’s potential acceptance of the Subscription, each
Participant individually, and not jointly or severally, makes the
following representations and warranties to the Company, which
warranties and representations shall survive any acceptance of the
Subscription by the Company:

 

(a)
Without limiting
its right to rely upon the representations and warranties of the
Company in Section
3, prior to the time of
purchase of the Shares, Participant has had an opportunity to
review the Company’s reports, schedules, forms, statements
and other documents filed by it with the United States Securities
and Exchange Commission (the “SEC
Reports”) (which filings can be accessed by
going to http://www.sec.gov/edgar/searchedgar/companysearch.html,
typing “PEDEVCO”
in the “Company
name” field, and clicking the “Search”
button), and Participant has had the opportunity to ask questions
and receive any additional information from persons acting on
behalf of the Company to verify Participant’s understanding
of the terms thereof and of the Company’s business and status
thereof. Participant acknowledges that no officer, director,
broker-dealer, placement agent, finder or other person affiliated
with the Company has given Participant any information or made any
representations, oral or written, other than as provided in the SEC
Reports and herein, on which Participant has relied upon in
deciding to invest in the Securities.

 

(b) Participant
acknowledges that Participant 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 form of
general solicitation or general advertising (within the meaning of
Regulation D under the Securities Act of 1933, as amended
(the “Securities
Act”)) with respect to the
Securities.

 

(c) The Securities are
being acquired for Participant’s own account and not with a
view to resale the Securities in violation of the Securities
Act.

 

(d) Participant
acknowledges that the Securities have not been registered under the
Securities Act or qualified under any blue sky laws, in reliance,
in part, on Participant’s representations, warranties and
agreements made herein.

 

(e) Other than the
rights specifically set forth in this Subscription and disclosed in
the SEC Reports, Participant represents, warrants and agrees that
the Company and the officers of the Company (the
“Company’s
Officers”) are under no obligation to register or
qualify the Securities under the Securities Act or under any state
securities law, or to assist the undersigned in complying with any
exemption from registration and qualification.

 

(f) Participant
represents that Participant meets the criteria for participation
because: (i) Participant has a pre-existing personal or business
relationship with the Company or one or more of its partners,
officers, directors or controlling persons; or (ii) by reason of
Participant’s business or financial experience, or by reason
of the business or financial experience of its financial advisors
who are unaffiliated with, and are not compensated, directly or
indirectly, by the Company or any affiliate or selling agent of the
Company, Participant is capable of evaluating the risk and merits
of an investment in the Securities and of protecting its own
interests;

 

(g) Participant
represents that Participant is an “accredited
investor” as such term is defined in Rule 501 of the
Securities Act, and has executed the Certificate of Accredited
Investor Status and Investor Information, attached hereto as
Exhibit
A.

  

 

2

 

  

(h) Participant
understands that the right to transfer the Securities will be
restricted unless the transfer is not in violation of the
Securities Act and any other applicable state or foreign securities
laws (including investment suitability standards), that the Company
will not consent to a transfer of the Securities unless the
transferee represents that such transferee meets the financial
suitability standards required of an initial participant, and that
the Company has the right, in its absolute discretion, to refuse to
consent to such transfer.

 

(i) Participant has
been advised to consult with its 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 Participant considers necessary.

 

(j) Participant
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, directors, agents, officers,
employees, affiliates or consultants of any of them, will be
responsible or liable for the tax consequences to Participant of an
investment in the Company. Participant will look solely to and rely
upon its own advisers with respect to the tax consequences of this
investment.

 

(k) All information
which Participant has provided to the Company concerning
Participant, its financial position and its knowledge of financial
and business matters, and any information found in the Certificate
of Accredited Investor Status and Investor Information, is
truthful, accurate, correct, and complete as of the date set forth
herein.

 

(l)     
Participant is in full compliance with, and the Participant’s
payment of the Purchase Price in connection with the Offering will
be in full compliance with, all applicable U.S. laws, regulations,
directives, and executive orders imposing economic sanctions,
embargoes, export controls or anti-money laundering requirements,
including but not limited to the following laws: (1) the
International Emergency Economic Powers Act, 50 U.S.C. 1701-1706;
(2) the National Emergencies Act, 50 U.S.C. 1601-1651; (3) section
5 of the United Nations Participation Act of 1945, 22 U.S.C. 287c;
(4) Section 321 of the Antiterrorism Act, 18 U.S.C. 2332d; (5) the
Export Administration Act of 1979, as amended, 50 U.S.C. app.
2401-2420; (6) the Trading with the Enemy Act, 50 U.S.C. app. 1 et
seq.; (7) the Uniting and Strengthening America by Providing
Appropriate Tools Required to Intercept and Obstruct Terrorism Act
of 2001, Public Law 107-56; and (8) Executive Order 13224 (Blocking
Property and Prohibiting Transactions with Persons Who Commit,
Threaten to Commit, or Support Terrorism) of September 23, 2001.
The Participant represents that the amounts invested by it in the
Company in the Offering were not and are not directly or indirectly
derived from activities that contravene federal, state or
international laws and regulations, including anti-money laundering
laws and regulations (collectively, the “Regulations”).
To the best of the Participant’s knowledge, none of: (1) the
Participant; (2) any person controlling or controlled by the
Participant; (3) if the Participant is a privately-held entity, any
person having a beneficial interest in the Participant; or (4) any
person for whom the Participant is acting as agent or nominee in
connection with this investment is a country, territory, individual
or entity named on an Office of Foreign Assets Control
(“OFAC”)
list, or a person or entity prohibited under the OFAC Programs.
Participant will provide additional information or take such
actions as may be necessary or advisable for the Company, in its
sole judgment, to comply with any such Regulations.

 

(m)
The Participant (on
its own behalf and, if applicable, on behalf of any person for
whose benefit the Participant is subscribing) acknowledges and
consents to the fact the Company is collecting the
Participant’s (and any beneficial purchaser’s) personal
information pursuant to this Agreement. The Participant (on its own
behalf and, if applicable, on behalf of any person for whose
benefit the Participant is subscribing) acknowledges and consents
to the Company retaining the personal information for as long as
permitted or required by applicable law or business practices. The
Participant (on its own behalf and, if applicable, on behalf of any
person for whose benefit the Participant is subscribing) further
acknowledges and consents to the fact the Company may be required
by applicable securities laws and stock exchange rules to provide
regulatory authorities any personal information provided by the
Participant respecting itself (and any beneficial purchaser). By
executing this Agreement, the Participant is deemed to be
consenting to the foregoing collection, use and disclosure of the
Participant’s (and any beneficial purchaser’s) personal
information. The Participant also consents to the filing of copies
or originals of any of the Participant’s documents described
herein as may be required to be filed with any stock exchange or
securities regulatory authority in connection with the transactions
contemplated hereby. The Participant represents and warrants that
it has the authority to provide the consents and acknowledgments
set out in this paragraph on behalf of all beneficial
purchasers.

 

(n)           Each
certificate or instrument representing securities issuable pursuant
to this Agreement will be endorsed with the following
legend:

 

THE
SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD,
TRANSFERRED, ASSIGNED OR HYPOTHECATED UNLESS THERE IS AN EFFECTIVE
REGISTRATION STATEMENT UNDER SUCH ACT COVERING SUCH SECURITIES, THE
TRANSFER IS MADE IN COMPLIANCE WITH RULE 144 PROMULGATED UNDER SUCH
ACT OR THE COMPANY RECEIVES AN OPINION OF COUNSEL FOR THE HOLDER OF
THESE SECURITIES WHICH IS REASONABLY SATISFACTORY TO THE COMPANY,
STATING THAT SUCH SALE, TRANSFER, ASSIGNMENT OR HYPOTHECATION IS
EXEMPT FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS
OF SUCH ACT.

 

 

3

 

 

3.   
Representations and Warranties by the Company. The
Company represents and warrants to Participant that:

 

(a) Due Formation. The Company is a
corporation duly incorporated, validly existing and in good
standing under the laws of the jurisdiction of its incorporation
and has all requisite corporate power and authority to own or lease
its properties and assets and to carry on its business as now being
conducted. The Company is duly qualified as a foreign entity to do
business and is in good standing in each jurisdiction where the
nature of the business conducted or property owned by it makes such
qualification necessary, other than those jurisdictions in which
the failure to so qualify would not have a Material Adverse Effect
on the business, operations or financial condition of the
Company.

 

(b) Capitalization. The Company is
authorized under its Certificate of Formation, as amended, to issue
200,000,000 shares of common stock. The Company’s disclosure
of its issued and outstanding capital stock in its most recent SEC
Filing containing such information is accurate in all material
respects as of the date indicated in such SEC Filing. All of the
issued and outstanding shares of the Company’s capital stock
have been duly authorized and validly issued and are fully paid and
nonassessable; none of such shares were issued in violation of any
pre-emptive rights; and such shares were issued in compliance in
all material respects with applicable state and federal securities
law and any rights of third parties. No Person is entitled to
pre-emptive or similar statutory or contractual rights with respect
to the issuance by the Company of any securities of the Company,
including, without limitation, the Securities. Except for stock
options, warrants, convertible notes and other convertible
securities described in the SEC Filings, there are no outstanding
warrants, options, convertible securities or other rights,
agreements or arrangements of any character under which the Company
is or may be obligated to issue any equity securities of any kind,
except as contemplated by this Agreement. There are no voting
agreements, buy-sell agreements, option or right of first purchase
agreements or other agreements of any kind among the Company and
any of the securityholders of the Company relating to the
securities of the Company held by them, except as set forth in the
SEC Filings. No Person has the right to require the Company to
register any securities of the Company under the Securities Act,
whether on a demand basis or in connection with the registration of
securities of the Company for its own account or for the account of
any other Person, except as set forth in the SEC Filings. The
issuance and sale of the Shares hereunder will not obligate the
Company to issue shares of common stock or other securities to any
other Person and will not result in the adjustment of the exercise,
conversion, exchange or reset price of any outstanding security.
The Company does not have outstanding stockholder purchase rights
or “poison pill” or any similar arrangement in effect
giving any Person the right to purchase any equity interest in the
Company upon the occurrence of certain events.

 

(c) Authority; Enforceability. This
Subscription delivered together with this Subscription or in
connection herewith have been duly authorized, executed, and
delivered by the Company and are legal, valid and binding
agreements, enforceable in accordance with their terms, subject to
bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium, and similar laws of general applicability relating to
or affecting creditors’ rights generally and to general
principles of equity; and the Company has the requisite corporate
power and authority and has taken all requisite corporate action
necessary for, and no further action on the part of the Company,
its officers, directors and stockholders is necessary for, (i) the
authorization, execution and delivery of this Subscription, (ii)
the authorization of the performance of all obligations of the
Company hereunder or thereunder, and (iii) the authorization,
issuance (or reservation for issuance) and delivery of the
Shares.

 

(d) No General Solicitation.
Neither the Company, nor any of its affiliates, nor to its
knowledge, 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 the Securities.

 

(e) Governmental Consents. No
consent, approval, order or authorization of, or registration,
qualification, designation, declaration or filing with, any
federal, state or local governmental authority on the part of the
Company is required in connection with the consummation of the
transactions contemplated by this Subscription, except for the
approval of the NYSE American. Subject to the accuracy of the
representations and warranties of the Participant set forth in
Section 2 hereof, the Company has
taken all action necessary to exempt (i) the issuance and sale of
the Shares and (ii) the other transactions contemplated by this
Subscription, from the provisions of any stockholder rights plan or
other “poison pill” arrangement, any anti-takeover,
business combination or control share law or statute binding on the
Company or to which the Company or any of its assets and properties
is subject that is or could reasonably be expected to become
applicable to the Participant as a result of the transactions
contemplated hereby, including without limitation, the issuance of
the Shares and the ownership, disposition or voting of the
Securities by the Participant or the exercise of any right granted
to the Participant pursuant to this Subscription or the other
transaction documents relating hereto.

 

(f) No Litigation. There is no
action, suit, proceeding or investigation pending or, to the
Company’s knowledge, currently threatened against the Company
or any of its subsidiaries that questions the validity of this
Subscription or the right of the Company to enter into it, or to
consummate the transactions contemplated hereby or thereby, or that
might result, either individually or in the aggregate, in any
material adverse changes in the assets, condition or affairs of the
Company, financially or otherwise, or any change in the current
equity ownership of the Company, nor is the Company aware that
there is any basis for the foregoing. Neither the Company nor any
of its subsidiaries is a party or subject to the provisions of any
order, writ, injunction, judgment or decree of any court or
government agency or instrumentality. There is no action, suit,
proceeding or investigation by the Company or any of its
subsidiaries currently pending or which the Company or any of its
subsidiaries intends to initiate. The foregoing includes, without
limitation, actions, suits, proceedings or investigations pending
or threatened in writing (or any basis therefor known to the
Company) involving the prior employment of any of the
Company’s employees, their use in connection with the
Company’s business, or any information or techniques
allegedly proprietary to any of their former employers, or their
obligations under any agreements with prior employers.

 

 

4

 

 

(g) Compliance with Other
Instruments.

 

(i) The Company is not
in violation or default (and 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), of any provisions of its
formation documents, bylaws or of any instrument, judgment, order,
writ, decree or contract to which it is a party or by which it is
bound or, to its knowledge, of any provision of federal or state
statute, rule or regulation applicable to the Company, 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 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). The execution,
delivery and performance of this Subscription, and the consummation
of the transactions contemplated hereby will not result in any such
violation or be in conflict with or constitute, with or without the
passage of time and giving of notice, either a breach or default
under any such provision, instrument, judgment, order, writ, decree
or contract or an event which results in the creation of any lien,
charge or encumbrance upon any assets of the Company.

 

(ii) To
its knowledge, the Company has avoided every condition, and has not
performed any act, the occurrence of which would result in the
Company’s loss of any right granted under any license,
distribution agreement or other agreement.

 

(h) Tax Returns and Payments. The
Company has filed all tax returns and reports as required by law.
These returns and reports are true and correct in all material
respects. The Company has paid all taxes and other assessments
due.

 

(i) Permits. The Company and each
of its subsidiaries has all franchises, permits, licenses and any
similar authority necessary for the conduct of its business, the
lack of which could materially and adversely affect the business,
properties, prospects, or financial condition of the Company. The
Company is not in default in any material respect under any of such
franchises, permits, licenses or other similar
authority.

 

(j) Offering Valid. Assuming the
accuracy of the representations and warranties of Participant
contained in Section 2 hereof, the offer, sale
and issuance of the Securities will be exempt from the registration
requirements of the Securities Act, and will have been registered
or qualified (or are exempt from registration and qualification)
under the registration, permit or qualification requirements of all
applicable state securities laws. Neither the Company nor any agent
on its behalf has solicited or will solicit any offers to sell or
has offered to sell or will offer to sell all or any part of the
Shares to any person or persons so as to bring the sale of such
Shares by the Company within the registration provisions of the
Securities Act or any state securities laws. Subject to receipt of
required NYSE American additional listing approval, at or prior to
Closing the issuance and sale of the Securities does not contravene
the rules and regulations of the NYSE American.

 

(k)
Valid Issuance. The Shares have
been duly and validly authorized and, when issued and paid for
pursuant to this Subscription, will be validly issued, fully paid
and nonassessable, and shall be free and clear of all encumbrances
and restrictions (other than those created by the Participant),
except for restrictions on transfer set forth in the transaction
documents or imposed by applicable securities laws.

 

(l)
SEC Filings. The Company has
filed all reports, schedules, forms, statements and other documents
required to be filed by the Company as of the date of this
Agreement, under the Securities Act and the Exchange Act, including
pursuant to Section 13(a) or 15(d) thereof, for the one year
preceding the date hereof (collectively, the “SEC
Filings”). At the time of filing thereof, the SEC
Filings complied in all material respects with the requirements of
the Securities Act or the Exchange Act, as applicable, and the
rules and regulations of the SEC thereunder. All material
agreements to which the Company is a party or to which the property
or assets of the Company is subject are included as part of or
identified in the SEC Filings, to the extent such agreements are
required to be included or identified pursuant to the rules and
regulations of the SEC.

 

(m)
Title to Properties. The
Company and its subsidiaries have good and marketable title to all
real properties and all other properties and assets owned by them,
in each case free from liens, encumbrances and defects, except such
as would not reasonably be expected, individually or in the
aggregate, to have a Material Adverse Effect; and the Company and
its subsidiaries hold any leased real or personal property under
valid and enforceable leases with no exceptions, except such as
would not reasonably be expected, individually or in the aggregate,
to have a Material Adverse Effect.

 

 

5

 

 

(n)
Financial Statements. The
financial statements included in each SEC Filing 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 (or to the extent corrected by a subsequent
restatement) and present fairly, in all material respects, the
consolidated financial position of the Company as of the dates
shown and its consolidated results of operations and cash flows for
the periods shown, subject in the case of unaudited financial
statements to normal, immaterial year-end audit adjustments, and
such consolidated financial statements have been prepared in
conformity with United States generally accepted accounting
principles applied on a consistent basis during the periods
involved (“GAAP”)
(except as may be disclosed therein or in the notes thereto, and
except that the unaudited financial statements may not contain all
footnotes required by GAAP, and, in the case of quarterly financial
statements, except as permitted by Form 10-Q under the Exchange
Act). Except as set forth in the financial statements of the
Company included in the SEC Filings filed prior to the date hereof,
the Company has not incurred any liabilities, contingent or
otherwise, except those incurred in the ordinary course of
business, consistent (as to amount and nature) with past practices
since the date of such financial statements, none of which,
individually or in the aggregate, have had or would reasonably be
expected to have a Material Adverse Effect.

 

(o)
Brokers and Finders. No Person
will have, as a result of the transactions contemplated by this
Subscription, any valid right, interest or claim against or upon
the Company or Participant for any commission, fee or other
compensation pursuant to any agreement, arrangement or
understanding entered into by or on behalf of the Company. No
Participant shall have any obligation with respect to any fees, or
with respect to any claims made by or on behalf of other Persons
for fees, in each case of the type contemplated by this
Section 3(o) that may be due in
connection with the transactions contemplated by this
Subscription.

 

(p)
Transactions with Affiliates.
Except as disclosed in the Company’s SEC Filings, none of the
executive officers or directors of the Company and, to the
Company’s knowledge, none of the employees of the Company is
presently a party to any material transaction with the Company
(other than as holders of stock options, and 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 Company’s
knowledge, any entity in which any officer, director, or any such
employee has a substantial interest or is an officer, director,
trustee or partner.

 

(q)
Disclosures. Neither the
Company nor any Person acting on its behalf has provided the
Participant or their agents or counsel with any information that
constitutes or would reasonably be expected to constitute material,
non-public information concerning the Company or its subsidiaries,
other than with respect to the transactions contemplated hereby
which will be disclosed in a Current Report on Form 8-K within four
business days of the Closing. The SEC Filings do not contain any
untrue statement of a material fact or omit to state a material
fact necessary in order to make the statements contained therein,
in light of the circumstances under which they were made, not
misleading. The Company understands and confirms that the
Participant will rely on the foregoing representations in effecting
transactions in securities of the Company.

 

(r)
Required Filings. Except for
the transactions contemplated by this Subscription, including the
acquisition of the Securities contemplated hereby, no event or
circumstance has occurred or information exists with respect to the
Company or its business, properties, operations or financial
condition, which, under applicable law, rule or regulation,
currently requires public disclosure or announcement by the Company
but which has not been so publicly announced or
disclosed.

 

(s)
Manipulation of Price. The
Company has not, and, to the Company’s knowledge, no Person
acting on its behalf has taken, directly or indirectly, any action
designed to cause or to result in the stabilization or manipulation
of the price of any security of the Company to facilitate the sale
or resale of any of the Securities.

 

4. Agreement
to Indemnify. The Company agrees to indemnify and hold
harmless each Participant and its Affiliates, and their respective
directors, officers, members, managers, employees, and agents, from
and against any and all losses, claims, damages, liabilities and
expenses (including without limitation reasonable and documented
attorney fees and disbursements and other documented out-of-pocket
expenses reasonably incurred in connection with investigating,
preparing or defending any action, claim or proceeding, pending or
threatened and the costs of enforcement thereof) (collectively,
“Losses”)
to which such Person may become subject as a result of any breach
of representation, warranty, covenant or agreement made by or to be
performed on the part of the Company under this Subscription, and
will reimburse any such Person for all such amounts as they are
incurred by such Person solely to the extent such amounts have been
finally judicially determined not to have resulted from such
Person’s fraud or willful misconduct.

  

 

6

 

  

5. Subscription
Binding on Heirs, etc. This Subscription, upon acceptance by
the Company, shall be binding upon the heirs, executors,
administrators, successors and assigns of the Participant. If the
undersigned is more than one person, the obligations of the
undersigned shall be joint and several and the representations and
warranties shall be deemed to be made by and be binding on each
such person and his or her heirs, executors, administrators,
successors, and assigns.

 

6. Execution
Authorized. If this Subscription is executed on behalf of a
corporation, partnership, trust or other entity, the undersigned
has been duly authorized and empowered to legally represent such
entity and to execute this Subscription and all other instruments
in connection with the Securities and the signature of the person
is binding upon such entity.

 

7. Governing
Law. This Subscription shall be construed in accordance with
the laws of the State of Texas.

 

8. Dispute
Resolution. In the event of any dispute arising out of or
relating to this Subscription, then such dispute shall be submitted
to binding arbitration with the Houston, Texas branch of the
American Arbitration Association (“AAA”)
to be governed by AAA’s Commercial Rules of Arbitration (the
“AAA
Rules”) and heard before one arbitrator. The parties
shall attempt to mutually select the arbitrator. In the event they
are unable to mutually agree, the arbitrator shall be selected by
the procedures prescribed by the AAA Rules. Notwithstanding
anything in the AAA Rules to the contrary, discovery shall be
limited exclusively to the mutual production of documents, and
written submissions to the arbitrator shall be limited to one brief
from each party and one responsive brief from each
party.

 

9. Further
Assurances. The Company and Participant hereby covenant that
they will, whenever and as reasonably requested by the other party,
do, execute, acknowledge and deliver any and all such other and
further acts, deeds, confirmations, and any instruments of further
assurance, approvals and consents as may reasonably be requested in
order to complete, insure and perfect the transactions contemplated
herein.

 

10. Commercially
Reasonable Efforts. Each party shall use commercially
reasonable efforts to timely satisfy each of the conditions to the
Closing, subject to the Company’s ability to reject this
Subscription pursuant to Section 1(f) hereof. No party shall
intentionally perform or fail to perform any act that, if performed
or omitted to be performed, would prevent or excuse the performance
of this Agreement or any of the transactions contemplated hereby,
subject to the Company’s ability to reject this Subscription
pursuant to Section
1(f) hereof.

 

11. Severability.
If any term or other provision of this Agreement is invalid,
illegal or incapable of being enforced by any rule of law, or
public policy, all other conditions and provisions of this
Agreement shall nevertheless remain in full force and effect so
long as the economic or legal substance of the transactions
contemplated hereby is not affected in any manner adverse to any
party. Upon such determination that any term or other provision is
invalid, illegal or incapable of being enforced, the parties hereto
shall negotiate in good faith to modify this Agreement so as to
affect the original intent of the parties as closely as possible in
an acceptable manner to the end that transactions contemplated
hereby are fulfilled to the extent possible.

 

12.
Entire Agreement, Amendments and
Waivers. This Agreement constitutes the entire agreement of
the parties regarding the subject matter of the Agreement and
expressly supersedes all prior and contemporaneous understandings
and commitments, whether written or oral, with respect to the
subject matter hereof. No variations, modifications, changes or
extensions of this Agreement or any other terms hereof shall be
binding upon any party hereto unless set forth in a document duly
executed by such party or an authorized agent of such
party.

 

13.
Extended Meanings. In this Agreement
words importing the singular number include the plural and vice
versa; words importing the masculine gender include the feminine
and neuter genders.

 

14.
Counterparts, Effect of Facsimile, Emailed and
Photocopied Signatures. This Agreement and any signed
agreement or instrument entered into in connection with this
Agreement, and any amendments hereto or thereto, may be executed in
one or more counterparts, all of which shall constitute one and the
same instrument. Any such counterpart, to the extent delivered by
means of a facsimile machine or by .pdf, .tif, .gif, .jpeg or
similar attachment to electronic mail (any such delivery, an
“Electronic
Delivery”) shall be treated in all manner and respects
as an original executed counterpart and shall be considered to have
the same binding legal effect as if it were the original signed
version thereof delivered in person. At the request of any party,
each other party shall re execute the original form of this
Agreement and deliver such form to all other parties. No Party
shall raise the use of Electronic Delivery to deliver a signature
or the fact that any signature or agreement or instrument was
transmitted or communicated through the use of Electronic Delivery
as a defense to the formation of a contract, and each such party
forever waives any such defense, except to the extent such defense
relates to lack of authenticity.

 

 

[Remainder
of page left intentionally blank. Signature pages
follow.]

 

Subscription
Agreement

 

7

 

 

Subject
to acceptance by the Company, the undersigned have completed this
Subscription Agreement to evidence his/her/its subscription for the
purchase of Shares of the Company, this 21st day of May
2019.

 

 

PARTICIPANT:

 

SK ENERGY LLC

 

/s/ Simon G.
Kukes                                                                            

Signature

 

Name: Simon G.
Kukes

 

Title: CEO and
Owner

 

Tax Identification No.: on
file

 

Jurisdiction of Organization: Delaware

 

State of Principal Place of Operations: Texas

 

Investment Amount (# of Shares): 6,818,181

 

Purchase Price Paid ($): $14,999,998.20

 

Address for Notice: Delivery Instructions (if different from
above):

 

	

Address
for Notice:

	
 

	
 

	

On
File

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	

Attention:

	

CEO

	
 

	
 

	
 

	

Email:

	

 On
File

	
 

	
 

	
 

  

 

Subscription
Agreement

 

8

 

 

The
Company has accepted this subscription this 21st day of May,
2019

 

 

“COMPANY”

 

PEDEVCO
CORP.,

a
Texas corporation

 

By:/s/ Clark R.
Moore
                                                   

Clark
R. Moore

Executive Vice
President

and
General Counsel

 

 

 

Address
for notice:

 

PEDEVCO
Corp.

1250
Wood Branch Drive, Suite 400

Houston, Texas
77079

Attn:
Corporate Counsel

 

Subscription
Agreement

 

9

 

Exhibit A

 

CERTIFICATE OF ACCREDITED INVESTOR STATUS AND INVESTOR
INFORMATION

 

           
Except as may be indicated by the undersigned below, the
undersigned is an “accredited
investor,” as that term is defined in Regulation D
under the Securities Act of 1933, as amended (the
“Securities
Act”). The undersigned has initialed the box below
indicating the basis on which he is representing his status as an
“accredited
investor”:

 

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

 

____  a
private business development company as defined in Section
202(a)(22) of the Investment Advisers Act of 1940;

 

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

 

____   
a natural person whose individual net worth, or joint net worth
with the undersigned’s spouse, at the time of this purchase
exceeds $1,000,000. For purposes of this item, “net
worth” means the excess of total assets at fair market
value (including personal and real property, but excluding the
estimated fair market value of a person’s primary home) over
total liabilities. Total liabilities excludes any mortgage on the
primary home in an amount of up to the home’s estimated fair
market value as long as the mortgage was incurred more than 60 days
before the Securities are purchased, but includes (i) any mortgage
amount in excess of the home’s fair market value and (ii) any
mortgage amount that was borrowed during the 60-day period before
the closing date for the sale of Securities for the purpose of
investing in the Securities;

 

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

 

____    
a trust with total assets in excess of $5,000,000, not formed for
the specific purpose of acquiring the securities offered, whose
purchase is directed by a person who has such knowledge and
experience in financial and business matters that he is capable of
evaluating the merits and risks of the prospective
investment;

 

_X__  
an entity in which all of the equity holders are
“accredited
investors” by virtue of their meeting one or more of
the above standards; or

 

____   
an individual who is a director or executive officer of PEDEVCO
Corp.

 

Investor Information: (This must be
consistent with the form of ownership selected below and the
information provided above)

 

Name (please
print): SK ENERGY,
LLC                                                                                                                                           

 

If entity named
above,  By: Simon G. Kukes 
                                        

   
           
           
          Its: CEO and
Owner                                                                                                

 

Social
Security or Taxpayer I.D. Number: on file 

 

Business Address
(including zip code):  on file
                                                                     

                                                                                                                            

Email
Address:  on file
                                

 

All
communications to be sent to:

 

 _________
Address ____X____
Email

 

 

10

 

 

Please
indicate below the form in which you will hold title to your
interest in the Shares. PLEASE CONSIDER CAREFULLY. ONCE YOUR
SUBSCRIPTION IS ACCEPTED, A CHANGE IN THE FORM OF TITLE CONSTITUTES
A TRANSFER OF THE INTEREST IN THE SHARES AND MAY THEREFORE BE
RESTRICTED BY THE TERMS OF THIS SUBSCRIPTION, AND MAY RESULT IN
ADDITIONAL COSTS TO YOU. Participants should seek the advice of
their attorneys in deciding in which of the forms they should take
ownership of the interest in the Shares, because different forms of
ownership can have varying gift tax, estate tax, income tax, and
other consequences, depending on the state of the investor’s
domicile and his or her particular personal
circumstances.

 

 INDIVIDUAL
OWNERSHIP (one signature required)

 

 JOINT TENANTS
WITH RIGHT OF SURVIVORSHIP AND NOT AS TENANTS IN COMMON (both or
all parties must sign)

 

 COMMUNITY
PROPERTY (one signature required if interest held in one name,
i.e., managing spouse; two signatures required if interest held in
both names)

 

 TENANTS IN
COMMON (both or all parties must sign)

 

 GENERAL
PARTNERSHIP (fill out all documents in the name of the PARTNERSHIP,
by a PARTNER authorized to sign)

 

 LIMITED
PARTNERSHIP (fill out all documents in the name of the LIMITED
PARTNERSHIP, by a GENERAL PARTNER authorized to sign)

 

      X LIMITED LIABILITY
COMPANY (fill out all documents in the name of the LIMITED
LIABILITY COMPANY, by a member authorized to sign)

 

       CORPORATION (fill
out all documents in the name of the CORPORATION, by the President
or other officer authorized to sign)

 

 TRUST (fill
out all documents in the name of the TRUST, by the Trustee, and
include a copy of the instrument creating the trust and any other
documents necessary to show the investment by the Trustee is
authorized. The date of the trust must appear on the Notarial where
indicated.)

 

IN
WITNESS WHEREOF, the undersigned has executed this Certificate of
Accredited Investor Status and Investor Information effective as of
May 21, 2019.

 

 

               Participant
Name: SK ENERGY,
LLC

 

	

By:/s/
Simon G. Kukes

Signature

 

	

Printed
Name: Simon G. Kukes

	
 

	

Title/Position:
CEO and Owner

(required for any
stockholder that is a corporation, partnership, trust or other
entity)

 

 

                                                   Subscription
Agreement

                                                                                                                                 PEDEVCO
Corp.

 

11

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