Document:

blonderex103to8k021216.htm

 

EXHIBIT 10.3

 

 

 

SUBORDINATION AGREEMENT

 

 

	
Borrower:

	
Blonder Tongue Laboratories, Inc.

One Jake Brown Road

Old Bridge, NJ 08857

 

and

 

R. L. Drake Holdings, L.L.C. One Jake Brown Road

Old Bridge, NJ 08857

 

	
Lender:

	
Santander Bank, N.A. (f/k/a Sovereign Bank, N.A.) MAIL CODE PA1-106-RM1

3 Terry Drive

Newtown, PA 18940

 

	
Creditor:

	
Robert J. Pallé and Carol Pallé, jointly

21 Desai Court

Freehold, NJ 07728

THIS SUBORDINATION AGREEMENT dated February 11th, 2016, is made and executed among Blonder Tongue Laboratories, Inc., One Jake Brown Road, Old Bridge, NJ 08857 (the “Company”) and R. L. Drake Holdings, L.L.C., One Jake Brown Road, Old Bridge, NJ 08857 (“Drake”; and together with the Company, collectively, jointly and severally, “Borrower”); Robert J. Pallé, and Carol Pallé, jointly, 21 Desai Court, Freehold NJ 07728 (“Creditor”); and Santander Bank, N.A. (f/k/a Sovereign Bank, N.A.), MAIL CODE PA1-106-RM1, 3 Terry Drive, Newtown, PA 18940 (“Lender”).

 

1.           REQUESTED FINANCIAL ACCOMMODATIONS.  Creditor and Borrower each want Lender to provide financial accommodations to Borrower in the form of (A) new credit or loan advances, (B) an extension of time to pay or other compromises regarding all or part of Borrower’s present indebtedness to Lender, or (C) other benefits to Borrower.  Borrower and Creditor each represent and acknowledge to Lender that Creditor will benefit as a result of these financial accommodations from Lender to Borrower, and Creditor acknowledges receipt of valuable consideration for entering into this Agreement. Based on the representations and acknowledgments contained in this Agreement, Borrower and Creditor agree with Lender as follows:

 

2.           SUBORDINATED INDEBTEDNESS.  The words “Subordinated Indebtedness” as used in this Agreement mean all present and future indebtedness, obligations, liabilities, claims, rights, and demands of any kind for borrowed money, which may be now or hereafter owing from Borrower to Creditor, including, without limitation, under and pursuant to that certain Senior Subordinated Convertible Loan and Security Agreement, dated on or about the date hereof (the “Creditor Loan Agreement”), pursuant to which Creditor may make loans and advances to Borrower, all as more fully contemplated thereby.  The term “Subordinated Indebtedness” is used in its broadest sense and includes without limitation all principal, all interest, all costs, reasonable attorneys’ fees, all sums paid for the purpose of protecting the rights of a holder of security, all contingent obligations of Borrower (such as a guaranty), and all other obligations, secured or unsecured, of any nature whatsoever; provided, however that “Subordinated Indebtedness” does not and is not intended to include any amount owing from time to time to Creditor in Creditor’s capacity as an employee officer, director or stockholder of Borrower.

 

3.           SUPERIOR INDEBTEDNESS.  The words “Superior Indebtedness” as used in this Agreement mean and include all present and future indebtedness, obligations, liabilities, claims, rights, and demands of any kind which may be now or hereafter owing from Borrower to Lender.  The term “Superior Indebtedness” is used in its broadest sense and includes without limitation all principal, all interest, all costs, reasonable attorneys’ fees, all sums paid for the purpose of protecting Lender’s rights in security (such as paying for insurance on collateral if the owner fails to do so), all contingent obligations of Borrower (such as a guaranty), all obligations arising by reason of Borrower’s accounts with Lender (such as an overdraft on a checking account), and all other obligations of Borrower to Lender, secured or unsecured, of any nature whatsoever.

  

  

  

 

4.           SUBORDINATION.  All Subordinated Indebtedness of Borrower to Creditor is and shall be subordinated in all respects to all Superior Indebtedness of Borrower to Lender.  Creditor holds or will hold one or more Security Interests, whether now existing or hereafter acquired, in Borrower’s real property and/or personal property, as contemplated by the Creditor Loan Agreement; provided, however, that Creditor also subordinates all such Creditor’s Security Interests to all Security Interests held by Lender, whether now existing or hereafter acquired; provided, however, that notwithstanding the foregoing, Lender acknowledges and agrees that Creditor’s Security Interests in equipment hereafter acquired by Borrower in connection with a permitted acquisition, which will be identified with specificity (‘Specified Equipment”), the purchase of which is financed with advances by Creditor to Borrower of Subordinated Indebtedness, will be senior to the Security Interests in favor of Lender, in such Specified Equipment and the proceeds thereof.

 

5.           PAYMENTS TO CREDITOR.  Borrower will not make and Creditor will not accept, at any time while any Superior Indebtedness is owing to Lender, (A) any payment upon any Subordinated Indebtedness, (B) any advance, transfer, or assignment of assets to Creditor in any form whatsoever that would reduce at any time or in any way the amount of Subordinated Indebtedness (except with respect to the Specified Equipment, as contemplated by section 4 above), or (C) any transfer of any assets as security for the Subordinated Indebtedness (other than as contemplated by the Creditor Loan Agreement and consented to herein), except upon Lender’s prior written consent.

 

In the event of any distribution, division, or application, whether partial or complete, voluntary or involuntary, by operation of law or otherwise, of all or any part of Borrower’s assets, or the proceeds of Borrower’s assets, in whatever form, to creditors of Borrower or upon any indebtedness of Borrower, whether by reason of the liquidation, dissolution or other winding-up of Borrower, or by reason of any execution sale, receivership, insolvency, or bankruptcy proceeding, assignment for the benefit of creditors, proceedings for reorganization, or readjustment of Borrower or Borrower’s properties, then and in such event other than with respect to the proceeds derived from the sale or other disposition of the Specified Equipment, (A) the Superior Indebtedness shall be paid in full before any payment is made upon the Subordinated Indebtedness, and (B) all payments and distributions, of any kind or character and whether in cash, property, or securities, which shall be payable or deliverable upon or in respect of the Subordinated Indebtedness shall be paid or delivered directly to Lender for application in payment of the amounts then due on the Superior Indebtedness until the Superior Indebtedness shall have been paid in full.  Nothing contained in this Agreement will limit or impair Creditor’s exercise of its rights under the Creditor Loan Agreement to convert all or any portion of the Subordinated Indebtedness into capital stock of the Company, as contemplated by the Creditor Loan Agreement.

 

In order that Lender may establish its right to prove claims and recover for its own account dividends based on the Subordinated Indebtedness, Creditor does hereby assign all its right, title, and interest in such claims to Lender, subject to Creditor’s rights in the proceeds of the Specified Equipment.  Creditor further agrees to supply such information and evidence, provide access to and copies of such of Creditor’s records as may pertain to the Subordinated Indebtedness, and execute such instruments as may be required by Lender to enable Lender to enforce all such claims and collect all dividends, payments, or other disbursements which may be made on account of the Subordinated Indebtedness.  For such purposes, Creditor hereby irrevocably authorizes Lender in its discretion to make and present for or on behalf of Creditor such proofs of claims on account of the Subordinated Indebtedness as Lender may deem expedient and proper and to vote such claims in any such proceeding and to receive and collect any and all dividends, payments, or other disbursements made thereon in whatever form the same may be paid or issued and to apply the same on account of the Superior Indebtedness, other than the proceeds of the Specified Equipment.

 

Should any payment, distribution, security, or proceeds thereof be received by Creditor at any time on the Subordinated Indebtedness contrary to the terms of this Agreement, Creditor promptly will deliver the same to Lender in precisely the form received (except for the endorsement or assignment of Creditor if necessary), for application on or to secure the Superior Indebtedness, whether it is due or not due, and until so delivered the same shall be held in trust by Creditor as property of Lender.  In the event Creditor fails to make any such endorsement or assignment, Lender, or any of its officers on behalf of Lender, is hereby irrevocably authorized by Creditor to make the same.

 

6.           CREDITOR’S NOTES.  Creditor agrees to deliver to Lender, at Lender’s request, all notes of Borrower to Creditor or other evidence of the Subordinated Indebtedness, now held or hereafter acquired by Creditor, while this Agreement remains in effect.  At Lender’s request, Borrower will also execute and deliver to Creditor a promissory note evidencing any book amount or claim now or hereafter owed by Borrower to Creditor, which note also shall be delivered by Creditor to Lender.  Creditor agrees not to sell, assign, pledge or otherwise transfer any of such notes except subject to all of the terms and conditions of this Agreement. Notwithstanding the foregoing, in the event that, pursuant to a request by Lender, Creditor supplies to Lender original loan documents memorializing Creditor’s loan to Borrower, the provision of such original loan documents to Lender shall not impair any of Creditor’s rights to enforce any of the provisions in the loan documents or any of the Creditor’s rights generally.

  

  

  

 

7.           CREDITOR’S REPRESENTATIONS AND WARRANTIES.  Creditor represents and warrants to Lender that: (A) no representations or agreements of any kind have been made to Creditor which would limit or qualify in any way the terms of this Agreement; (B) this Agreement is executed at Borrower’s request and not at the request of Lender; (C) Lender has made no representation to Creditor as to the creditworthiness of Borrower; and (D) Creditor has established adequate means of obtaining from Borrower on a continuing basis information regarding Borrower’s financial condition.  Creditor agrees to keep adequately informed from such means of any facts, events, or circumstances which might in any way affect Creditor’s risks under this Agreement, and Creditor further agrees that Lender shall have no obligation to disclose to Creditor information or material acquired by Lender in the course of its relationship with Borrower.

 

8.           CREDITOR’S WAIVERS.  Creditor waives any right to require Lender: (A) to make, extend, renew, or modify any loan to Borrower or to grant any other financial accommodations to Borrower whatsoever; (B) to make any presentment, protest, demand, or notice of any kind, including notice of any nonpayment of the Superior Indebtedness or of any nonpayment related to any Security Interests, or notice of any action or nonaction on the part of Borrower, Lender, any surety, endorser, or other guarantor in connection with the Superior Indebtedness, or in connection with the creation of new or additional Superior Indebtedness; (C) to resort for payment or to proceed directly or at once against any person, including Borrower; (D) to proceed directly against or exhaust any Security Interests held by Lender from Borrower, any other guarantor, or any other person; (E) to give notice of the terms, time, and place of any public or private sale of personal property security held by Lender from Borrower or to comply with any other applicable provisions of the Uniform Commercial Code; (F) to pursue any other remedy within Lender’s power; or (G) to commit any act or omission of any kind, at any time, with respect to any matter whatsoever.

 

9.           LENDER’S RIGHTS.  Lender may take or omit any and all actions with respect to the Superior Indebtedness or any Security Interests for the Superior Indebtedness without affecting whatsoever any of Lender’s rights under this Agreement.  In particular, without limitation, Lender may, without notice of any kind to Creditor, (A) make one or more additional secured or unsecured loans to Borrower; (B) repeatedly alter, compromise, renew, extend, accelerate, or otherwise change the time for payment or other terms of the Superior Indebtedness or any part thereof, including increases and decreases of the rate of interest on the Superior Indebtedness; extensions may be repeated and may be for longer than the original loan term; (C) take and hold Security Interests for the payment of the Superior Indebtedness, and exchange, enforce, waive, and release any such Security Interests, with or without the substitution of new collateral; (D) release, substitute, agree not to sue, or deal with any one or more of Borrower’s sureties, endorsers, or guarantors on any terms or manner Lender chooses; (E) determine how, when and what application of payments and credits, shall be made on the Superior Indebtedness; (F) apply such security and direct the order or manner of sale thereof, as Lender in its discretion may determine; and (G) assign this Agreement in whole or in part.

 

10.           DEFAULT BY BORROWER.  If Borrower becomes insolvent or bankrupt, this Agreement shall remain in full force and effect.  Any default by Borrower under the terms of the Subordinated Indebtedness also shall constitute an event of default under the terms of the Superior Indebtedness in favor of Lender.

 

11.           DURATION AND TERMINATION.  This Agreement will take effect when received by Lender, without the necessity of any acceptance by Lender, in writing or otherwise, and will remain in full force and effect until Creditor shall notify Lender in writing at the address shown above to the contrary.  Any such notice shall not affect the Superior Indebtedness owed Lender by Borrower at the time of such notice, nor shall such notice affect Superior Indebtedness thereafter granted in compliance with a commitment made by Lender to Borrower prior to receipt of such notice, nor shall such notice affect any renewals of or substitutions for any of the foregoing.  Such notice shall affect only indebtedness of Borrower to Lender arising after receipt of such notice and not arising from financial assistance granted by Lender to Borrower in compliance with Lender’s obligations under a commitment. Any notes lodged with Lender pursuant to the section titled “Creditor’s Notes” above need not be returned until this Agreement has no further force or effect.

 

12.           MISCELLANEOUS PROVISIONS.  The following miscellaneous provisions are a part of this Agreement:

  

  

  

 

Amendments.  This Agreement, together with any Related Documents, constitutes the entire understanding and agreement of the parties as to the matters set forth in this Agreement.  No alteration of or amendment to this Agreement shall be effective unless given in writing and signed by the party or parties sought to be charged or bound by the alteration or amendment.

 

Attorneys’ Fees; Expenses.  Creditor agrees to pay upon demand all of Lender’s costs and expenses, including Lender’s reasonable attorneys’ fees and Lender’s legal expenses, incurred in connection with the enforcement of this Agreement.  Lender may hire or pay someone else to help enforce this Agreement, and Creditor shall pay the costs and expenses of such enforcement.  Costs and expenses include Lender’s reasonable attorneys’ fees and legal expenses whether or not there is a lawsuit, including reasonable attorneys’ fees and legal expenses for bankruptcy proceedings (including efforts to modify or vacate any automatic stay or injunction), appeals, and any anticipated post-judgment collection services.  Creditor also shall pay all court costs and such additional fees as may be directed by the court.

 

Authority.  The person who signs this Agreement as or on behalf of Creditor represents and warrants that he or she has authority to execute this Agreement and to subordinate the Subordinated Indebtedness and the Creditor’s security interests in Creditor’s property, if any.

 

Caption Headings.  Caption headings in this Agreement are for convenience purposes only and are not to be used to interpret or define the provisions of this Agreement.

 

Governing Law.  This Agreement will be governed by federal law applicable to Lender and, to the extent not preempted by federal law, the laws of the State of New Jersey without regard to its conflicts of law provisions.  This Agreement has been accepted by Lender in the State of New Jersey.

 

Interpretation.  In all cases where there is more than one Creditor, then all words used in this Agreement in the singular shall be deemed to have been used in the plural where the context and construction so require; and where there is more than one Creditor named in this Agreement or when this Agreement is executed by more than one , the words “Creditor” shall mean all and any one or more of them.  Reference to the phrase “Creditor” includes the heirs, successors, assigns, and transferees of each of them.

 

Successors and Assigns.  This Agreement shall be understood to be for the benefit of Lender and Creditor and for such other person or persons as may from time to time become or be the holder or owner of any of the Superior Indebtedness or any interest therein, and this Agreement shall be transferable to the same extent and with the same force and effect as any such Superior Indebtedness may be transferable.

 

No Waiver by Lender.  Lender shall not be deemed to have waived any rights under this Agreement unless such waiver is given in writing and signed by Lender.  No delay or omission on the part of Lender in exercising any right shall operate as a waiver of such right or any other right.  A waiver by Lender of a provision of this Agreement shall not prejudice or constitute a waiver of Lender’s right otherwise to demand strict compliance with that provision or any other provision of this Agreement.  No prior waiver by Lender, nor any course of dealing between Lender and Creditor, shall constitute a waiver of any of Lender’s rights or of any of Creditor’s obligations as to any future transactions.  Whenever the consent of Lender is required under this Agreement, the granting of such consent by Lender in any instance shall not constitute continuing consent to subsequent instances where such consent is required and in all cases such consent may be granted or withheld in the sole discretion of Lender.

 

13.          DEFINITIONS.  The following capitalized words and terms shall have the following meanings when used in this Agreement.  Unless specifically stated to the contrary, all references to dollar amounts shall mean amounts in lawful money of the United States of America.  Words and terms used in the singular shall include the plural, and the plural shall include the singular, as the context may require.  Words and terms not otherwise defined in this Agreement shall have the meanings attributed to such terms in the Uniform Commercial Code:

 

Agreement.  The word “Agreement” means this Subordination Agreement, as this Subordination Agreement may be amended or modified from time to time, together with all exhibits and schedules attached to this Subordination Agreement from time to time.

  

  

  

 

Borrower.  The word “Borrower” collectively means Blonder Tongue Laboratories, Inc. and R. L. Drake Holdings, L.L.C. and includes all co-signers and co-makers signing the Note and all their successors and assigns.

 

Creditor.  The word “Creditor” means Robert J. Pallé and/or Carol Pallé, jointly and their successors and assigns..

 

Lender.  The word “Lender” means Santander Bank, N.A. (f/k/a Sovereign Bank, N.A.), its successors and assigns.

 

Note.  The word “Note” collectively means (a) the Term Note dated August 6, 2008 and executed by Blonder Tongue Laboratories, Inc. in the principal amount of $4,000,000.00, together with all renewals of, extensions of, modifications of, refinancings of, consolidations of, and substitutions for the note or credit agreement and (b) the Revolving Credit Note dated August 6, 2008 and executed by Blonder Tongue Laboratories, Inc. in the principal amount of $4,000,000.00, together with all renewals of, extensions of, modifications of, refinancings of, consolidations of, and substitutions for the note or credit agreement.

 

Related Documents.  The words “Related Documents” mean all promissory notes, credit agreements, loan agreements, environmental agreements, guaranties,  security  agreements,  mortgages,  deeds of  trust, security deeds, collateral mortgages, and all other instruments, agreements and documents, whether now or hereafter existing, executed in connection with the Superior Indebtedness.

 

Security Interest.  The words “Security Interest” mean, without limitation, any and all types of collateral security, present and future, whether in the form of a lien, charge, encumbrance, mortgage, deed of trust, security deed, assignment, pledge, crop pledge, chattel mortgage, collateral chattel mortgage, chattel trust, factor’s lien, equipment trust, conditional sale, trust receipt, lien or title retention contract, lease or consignment intended as a security device, or any other security or lien interest whatsoever whether created by law, contract, or otherwise.

 

Subordinated Indebtedness.  The words “Subordinated Indebtedness” mean the indebtedness described in the section of this Agreement titled “Subordinated Indebtedness”.

 

Superior Indebtedness.  The words “Superior Indebtedness” mean the indebtedness described in the section of this Agreement titled “Superior Indebtedness”.

 

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IN WITNESS WHEREOF THE PARTIES, INTENDING TO BE LEGALLY BOUND, HAVE EXECUTED THIS SUBORDINAITON AGREEMENT AS OF THE DATE FIRST ABOVE WRITTEN.

 

BORROWER:

 

BLONDER TONGUE LABORATORIES, INC.

 

	
  

	
By:                                                             

	
  

	
Eric Skolnik, Chief Financial Officer

 

R. L. DRAKE HOLDINGS, L.L.C.

 

	
  

	
By:                                                             

	
  

	
Eric Skolnik, Chief Financial Officer

 

CREDITOR:

 

	
  

	                                                                    

	
  

	
Robert J. Pallé, Individually

 

	
  

	                                                             

	
  

	
Carol Pallé, Individually

 

LENDER:

 

SANTANDER BANK, N.A. f/k/a/ Sovereign Bank, N.A.

 

	
  

	
By:                                                          

	
  

	
John Giangrossi, Vice PresidentExhibit 10.1

 

SECURITIES
PURCHASE AGREEMENT

 

This SECURITIES
PURCHASE AGREEMENT, is effective as of January 28, 2016 (the “Agreement”),
and is made by and among PEERLOGIX, INC., a Delaware corporation (the “Company”) and Pinewood
Trading Fund, L.P. (the “Investor”).

 

W I T N E S S E T H:

 

WHEREAS, the
Company has authorized the offer and sale of 100,000 shares (each a “Share” and, collectively, the “Shares”)
of its Common Stock, $.00001 par value (the “Common Stock”), in exchange for the Investor lending money to the
Company pursuant to the Promissory Note of even date herewith (the “Note”); and

 

WHEREAS, the
Company and the Investor are executing a set of documents collectively referred to as the “Transaction Documents”
which consist of (i) a Registration Rights Agreement, dated as of the date hereof (the “Registration Rights Agreement”)
a form of which is attached hereto as Exhibit A, this Agreement, and the
Note.

 

NOW,
THEREFORE, in consideration of the mutual promises, representations, warranties and covenants hereinafter set forth
and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:

 

ARTICLE I

 

Agreement
to ISSUE the Shares

 

Section 1.01Authorization
of Shares. The Company has authorized the sale, issuance and delivery of the Shares. The Shares shall have the rights,
preferences, privileges and restrictions set forth in the Articles of Incorporation of the Company.

 

Section 1.02Sale
and Purchase. Subject to the terms and conditions of this Agreement, the Company will sell, issue and deliver to the Investor,
and the Investor will purchase from Company, the Shares in exchange for the Note.

 

ARTICLE II

 

CLOSING, DELIVERY, AND PAYMENT

 

Section 2.01Closing.
The parties agree that the delivery of this Agreement, the Transaction Documents and any other documents at a closing may be
effected by means of an exchange of facsimile signatures with original copies to follow by mail or courier service.

 

Section 2.02Exchanges.

 

(a)The Company
shall deliver or cause to be delivered to the Investor stock certificates, registered in the name of the Investor or as directed
thereby in writing.

 

(b)The Investor
shall deliver or cause to be delivered to the Company the Note and the funds lent pursuant to the Note.

 

    	 	 	 

     

    

 

Section 2.03Status
of Securities. The Shares shall be deemed “restricted securities” as defined in paragraph (a) of Rule 144 under
the Securities Act of 1933, as amended (the “Securities Act”). The acquisition by the Investor of the Shares
shall be subject to an exemption from the registration requirements of the Securities Act, under Section 4(a)(2) of the Securities
Act and the rules and regulations promulgated thereunder. Certificates representing the Shares shall bear a restrictive legend
in substantially the following form, until such time as the Shares have been registered for resale:

 

THIS SECURITY HAS NOT BEEN REGISTERED
WITH THE U.S SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION
NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS
EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE
TO THE COMPANY. THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.

 

ARTICLE
III

 

Representations
and Warranties

 

Except as set forth
in the documents filed by or on behalf of the Company with the United States Securities and Exchange Commission (the “SEC”)
from time to time (collectively, the “SEC Documents”), the Company hereby represents and warrants to the Investor
as of the date hereof that the statements contained in this Article 3 are true and correct in all material respects. For purposes
of this Agreement, the phrases “knowledge of Company” or “Company’s knowledge”, or words of similar
import, shall mean the knowledge of matters of which the executive officers of the Company at the date hereof, in the reasonably
prudent exercise of their duties, are actually aware.

 

Section 3.01Exchange Act.

 

(a)The Company
is current in its filings under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The SEC
Documents, including, without limitation, any financial statements and schedules included therein, at the time filed or, if subsequently
amended, as so amended, (i) did not contain any untrue statement of a material fact required to be stated therein or necessary
in order to make the statements therein not misleading and (ii) complied in all material respects with the applicable requirements
of the Exchange Act and the applicable rules and regulations thereunder.

 

(b)The Chief Executive
Officer and the Chief Financial Officer of the Company have signed, and the Company has furnished to the SEC, all certifications
required by Sections 302 and 906 of the Sarbanes-Oxley Act of 2002; such certifications contain no qualifications or exceptions
to the matters certified therein and have not been modified or withdrawn; and neither the Company nor any of its officers has received
notice from any governmental entity questioning or challenging the accuracy, completeness, form or manner of filing or submission
of such certifications.

 

Section 3.02Trading
Market. The Common Stock is eligible to trade and be quoted on the OTCQB market, maintained by OTC Markets, Inc. (the “OTCQB”).
The Company has not, and shall not have taken any action that would preclude, or otherwise jeopardize, the inclusion of the Common
Stock for quotation on the OTCQB.

 

    	 	2	 

     

    

 

Section 3.03Organization;
Good Standing; Qualification; Authorizations. The Company has no subsidiaries or affiliated corporations or owns any interest
in any other enterprise (whether or not such enterprise is a corporation) other than as set forth in the SEC Documents (the “Company
Subsidiaries”). The Company and each of the Company Subsidiaries have been duly organized and is validly existing as
a corporation in good standing under the laws of its respective jurisdiction of incorporation with full power and authority (corporate
and other) to own, lease and operate its respective properties and conduct its respective business as described in the SEC Documents.
The Company and each of the Company Subsidiaries is duly qualified to do business as a foreign corporation and is in good standing
in each jurisdiction in which the ownership or leasing of its respective properties or the conduct of its respective business requires
such qualification, except where the failure to be so qualified or be in good standing would not have a material adverse effect
on the business, prospects, financial condition, and results of operations of the Company and the Company Subsidiaries taken as
a whole; no proceeding has been instituted in any such jurisdiction, revoking, limiting or curtailing, or seeking to revoke, limit
or curtail, such power and authority or qualification; the Company and each of the Company Subsidiaries is in possession of, and
operating in compliance with, all authorizations, licenses, certificates, consents, orders and permits from state, federal, foreign
and other regulatory authorities that are material to the conduct of its business, all of which are valid and in full force and
effect; neither the Company nor any of the Company Subsidiaries is in violation of its respective charter or bylaws or in default
in the performance or observance of any obligation, agreement, covenant or condition contained in any material bond, debenture,
note or other evidence of indebtedness, or in any material lease, contract, indenture, mortgage, deed of trust, loan agreement,
joint venture or other agreement or instrument to which it is a party or by which it or its respective properties or assets may
be bound, which violation or default would have a material adverse effect on the business, prospects, financial condition or results
of operations of the Company and the Company Subsidiaries taken as a whole; and neither the Company nor any of the Company Subsidiaries
is in violation of any law, order, rule, regulation, writ, injunction, judgment or decree of any court, government or governmental
agency or body, domestic or foreign, having jurisdiction over the Company, any of the Company Subsidiaries, or over its respective
properties or assets, which violation would have a material adverse effect on the business, prospects, financial condition or results
of operations of the Company and the Company Subsidiaries taken as a whole. The SEC Documents accurately describe, in all material
respects, any corporation, association or other entity owned or controlled, directly or indirectly, by the Company.

 

Section 3.04Authority.
The Company has all requisite power and authority to execute, deliver, and perform each of the Transaction Documents. All necessary
proceedings of the Company have been duly taken to authorize the execution, delivery, and performance of each of the Transaction
Documents thereby. Each of the Transaction Documents has been duly authorized, executed, and delivered by the Company, constitutes
the legal, valid, and binding obligation of the Company, and is enforceable as to the Company in accordance with its respective
terms. Except as otherwise set forth in the Transaction Documents, no consent, authorization, approval, order, license, certificate,
or permit of or from, or declaration or filing with, any federal, state, local, or other governmental authority or any court or
other tribunal is required by the Company for the execution, delivery, or performance thereof thereby. No consent, approval, authorization
or order of, or qualification with, any court, government or governmental agency or body, domestic or foreign, having jurisdiction
over the Company, any Company Subsidiaries, or over its respective properties or assets is required for the execution and delivery
of any Transaction Documents and the consummation by the Company of the transactions contemplated by the Transaction Documents,
except such as may be required under the Securities Act or under state or other securities or blue sky laws, all of which requirements
have been, or in accordance therewith will be, satisfied in all material respects. No consent of any party to any material contract,
agreement, instrument, lease, license, arrangement, or understanding to which the Company or any of the Company Subsidiaries is
a party, or to which its or any of its respective businesses, properties, or assets are subject, is required for the execution,
delivery, or performance of any of the Transaction Documents; and the execution, delivery and performance of the Transaction Documents
will not violate, result in a breach of, conflict with, or (with or without the giving of notice or the passage of time or both)
entitle any party to terminate or call a default under, entitle any party to receive rights or privileges that such party was not
entitled to receive immediately before this Agreement was executed under, or create any obligation on the part of the Company or
any of the Company Subsidiaries to which it was not subject immediately before this Agreement was executed under, any term of any
such material contract, agreement, instrument, lease, license, arrangement, or understanding, or violate or result in a breach
of any term of the charter or bylaws of the Company or any of the Company Subsidiaries or (if the provisions of the Transaction
Documents are satisfied) violate, result in a breach of, or conflict with any law, rule, regulation, order, judgment, decree, injunction,
or writ of any court, government or governmental agency or body, domestic or foreign, having jurisdiction over the Company, the
Company Subsidiaries, or over its respective properties or assets.

 

    	 	3	 

     

    

 

Section 3.05Litigation.
There is not any pending or, to the best of the Company’s knowledge, threatened, action, suit, claim or proceeding against
the Company, any of the Company Subsidiaries, or any of the Company’s or any Company Subsidiary’s respective officers
or any of its respective properties, assets or rights, before any court, government or governmental agency or body, domestic or
foreign, having jurisdiction over the Company, any of the Company Subsidiaries, or over the Company’s or any Company Subsidiary’s
officers or the properties of the Company or any of the Company Subsidiaries, or otherwise that (i) is reasonably likely to result
in any material adverse change in the business, prospects, financial condition or results of operations of the Company and the
Company Subsidiaries taken as a whole or might materially and adversely affect their properties, assets or rights taken as a whole;
(ii) might prevent consummation of the transactions contemplated by the Transaction Documents; or (iii) alleging violation of any
Federal or state securities laws.

 

Section 3.06Capitalization.

 

(a)Except as disclosed
in the SEC Documents, (1) there is no commitment, plan, or arrangement to issue, and no outstanding option, warrant, or other right
calling for the issuance of, any share of capital stock of, or any security or other instrument convertible into, exercisable for,
or exchangeable for capital stock of, the Company, and (2) except as described in the SEC Documents, there is outstanding no security
or other instrument convertible into or exchangeable for capital stock of the Company.

 

(b)The Company
is not under any obligation, and has not granted any rights, to register under the Securities Act, the issuance or sale of any
of the Company’s presently outstanding securities or any of its securities that may hereafter be issued except as set forth
in the SEC Documents, the Exhibits thereto and the Registration Rights Agreement attached hereto as Exhibit A.

 

(c)The rights,
preferences and privileges of the Shares are as stated in the Company’s Articles of Incorporation.

 

(f)When delivered
by the Company in accordance with the terms of this Agreement, the Shares will be (i) duly and validly issued and fully paid and
non-assessable, (ii) will be sold free and clear of any pledge, lien, security interest, encumbrance, claim or equitable interest
of any kind, and, other than as provided in the Transaction Documents, no preemptive right, right of first refusal or other similar
right of stockholders exists with respect to any of the Shares or the issuance and sale thereof other than those that have been
expressly waived prior to the date hereof and those that will automatically expire upon the execution hereof, (iii) assuming the
accuracy of the representations and warranties of the Investor contained in Article 4 hereof, issued in compliance with applicable
federal and state securities laws.

 

Section 3.07Financial Statements.

 

(a)The audited
consolidated financial statements of the Company, together with the related schedules and notes, and the unaudited consolidated
financial information, forming part of the SEC Documents, fairly present and will fairly present the financial position and the
results of operations of the Company at the respective dates and for the respective periods to which they apply; and all audited
consolidated financial statements of the Company, together with the related schedules and notes, and the unaudited consolidated
financial information, filed with the SEC as part of the SEC Documents, complied and will comply as to form in all material respects
with applicable accounting requirements and with the rules and regulations of the SEC with respect hereto when filed, have been
and will be prepared in accordance with generally accepted accounting principles consistently applied throughout the periods involved
except as may be otherwise stated therein (except as may be indicated in the notes thereto or as permitted by the rules and regulations
of the SEC) and fairly present and will fairly present, subject in the case of the unaudited consolidated financial statements,
to customary year end audit adjustments, the consolidated financial position of the Company as at the dates thereof and the results
of its operations and cash flows.

 

    	 	4	 

     

    

 

(b)There is no
fact known to the Company which materially adversely affects (as far as the Company can reasonably foresee) the business, prospects,
financial condition or results of operation of the Company and the Company Subsidiaries taken as a whole; provided, however,
that the Company expresses no opinion as to political or economic matters of general applicability. The Company has made known,
or caused to be made known, to the accountants or auditors who have prepared, reviewed, or audited the aforementioned consolidated
financial statements all material facts and circumstances which could affect the preparation, presentation, accuracy, or completeness
thereof.

 

Section 3.08Material
Changes. Subsequent to the respective dates as of which information is given in the SEC Documents, and as otherwise contemplated
by the Transaction Documents, there has not been (i) any material adverse change in the business, prospects, financial condition
or results of operations of the Company and of the Company or the Company Subsidiaries taken as a whole, (ii) any transaction committed
to or consummated that is material to the Company and the Company Subsidiaries taken as a whole, (iii) any obligation, direct or
contingent, that is material to the Company and the Company Subsidiaries taken as a whole incurred by the Company, except such
obligations as have been incurred in the ordinary course of business, (iv) any change in the capital stock or outstanding indebtedness
of Company or any Company Subsidiary that is material to Company and the Company Subsidiaries taken as a whole, (v) any dividend
or distribution of any kind declared, paid, or made on the capital stock of Company, or (vi) any loss or damage (whether or not
insured) to the property of Company or any of the Company Subsidiaries which has a material adverse effect on the business, prospects,
financial condition, or results of operations of Company and the Company Subsidiaries taken as a whole.

 

Section 3.09Investment
Company Act. Company has been advised concerning the Investment Company Act of 1940, as
amended (the "Investment Company Act"), and the rules and regulations promulgated thereunder, and has in the
past conducted, and intends in the future, to conduct its affairs in such a manner as to ensure that it is not and will not become
an “investment company” or a company "controlled" by an "investment company" within the meaning
of the Investment Company Act and such rules and regulations.

 

Section 3.10Loans;
Guarantees. Except as set forth in the SEC Documents, there are no outstanding loans, advances (except normal advances
for business expenses in the ordinary course of business) or guarantees of indebtedness by the Company or any of the Company Subsidiaries
to, or for the benefit of, any of the officers, directors, or director-nominees of the Company or any of the Company Subsidiaries,
or any of the members of the families of any of them. 

 

Section 3.11Finders
Fees. Company has not incurred any liability, direct or indirect, for finders’, consulting, or similar fees on behalf
of or payable by the Company or the Investor in connection with the Transaction Documents or any other transaction involving the
Company and the Investor.

 

Section 3.12Compliance
with Laws.  The Company and each of the Company Subsidiaries is in compliance in all material respects with, and is not
in violation of, applicable federal, state, local or foreign statutes, laws and regulations (including without limitation, any
applicable building, zoning or other law, ordinance or regulation) affecting its properties or the operation of its business, including,
without limitation, Sarbanes-Oxley Act of 2002 and the rules and regulations promulgated pursuant thereto or thereunder. Neither
the Company nor any of the Company Subsidiaries is subject to any order, decree, judgment or other sanction of any court, administrative
agency or other tribunal.

 

    	 	5	 

     

    

 

ARTICLE
IV

 

Representations
and Warranties of INVESTOR

 

The Investor represents
and warrants to the Company as of the date hereof that the statements contained in this Article 4 are true and correct as follows.

 

Section 4.01Requisite
Power and Authority. Investor has all necessary power and authority to execute and deliver each of the Transaction Documents
and to carry out their provisions. All action on Investor’s part required for the execution and delivery of each of the Transaction
Documents has been taken. Upon their execution and delivery, such Transaction Documents will be valid and binding obligations of
Investor, enforceable in accordance with their respective terms.

 

Section 4.02Investment
Representations. Investor is an “accredited investor” as such term is defined in Rule 501 of Regulation D promulgated
under the Securities Act. Investor is purchasing the Shares for its own account, for investment purposes only and has no current
arrangements or understandings for the resale or distribution to others and will only resell such Shares pursuant to a registration
or an available exemption under applicable law. Investor acknowledges that the offer and sale of the Shares have not been registered
under the Securities Act or the securities laws of any state or other jurisdiction, and that the Shares are being offered and sold
pursuant to an exemption from registration contained in the Securities Act, and cannot be disposed of unless they are subsequently
registered under the Securities Act and any applicable state laws or an exemption from such registration is available.

 

Section 4.03Information.
Investor and its advisors, if any, have been furnished with all materials relating to the business, finances and operations of
the Company and materials relating to the offer and sale of the securities herein which have been requested by Investor or its
advisors. The Investor and its advisors, if any, have been afforded the opportunity to ask questions of the Company. Notwithstanding
the foregoing, the Company has not disclosed to Investor any material nonpublic information and will not disclose such information
unless such information is disclosed to the public prior to or promptly following such disclosure to Investor except as set forth
in the Registration Rights Agreement attached hereto as Exhibit A. Neither such inquiries nor any other due diligence investigation
conducted by Investor or any of its advisors or representatives shall modify, amend or affect Investor’s right to rely on
the Company’s representations and warranties contained herein. Investor understands that its investment in the securities
involves a significant degree of risk. Investor is not aware of any facts that may constitute a breach of any of the Company’s
representations and warranties made herein.

 

Section 4.04Governmental
Review. Investor understands that no United States federal or state agency or any other government or governmental agency
has passed upon or made any recommendation or endorsement of the securities.

 

Section 4.05Authorization;
Enforcement. This Agreement (a) has been duly and validly authorized; (b) has been duly executed and delivered on behalf
of Investor; and (c) constitutes a valid and binding agreement of Investor enforceable in accordance with its terms.

 

Article
VII

 

Miscellaneous

 

Section 7.01Governing
Law. This Agreement shall be governed, construed and interpreted in accordance with the law of the State of New York, as
to matters within the scope thereof, and the internal laws of the State of New York, without giving effect to principles of conflicts
of law and choice of law that would cause the substantive laws of any other jurisdiction to apply. The Company irrevocably submits
and consents to the jurisdiction of any state court or federal court sitting in the State and County of New York over any action
or proceeding arising out of or relating to the Transaction Documents, and the Company hereby irrevocably agrees that all claims
in respect of any such action or proceeding may be heard and determined in such courts.

 

    	 	6	 

     

    

 

Section 7.02Survival.
The representations, warranties, covenants and agreements made in this Agreement, the Transaction Documents, or any other agreement,
certificate, document or instrument furnished pursuant hereto shall survive any investigation made by the Investor and the closing
of the transactions contemplated hereby. Article V of this Agreement shall survive the closing of the transactions contemplated
hereby.

 

Section 7.03Amendment
and Waiver. Any provision of this Agreement may be amended and the observance thereof may be waived (either generally or
in a particular instance and either retroactively or prospectively), only by the written consent of both Company and the Investor.
Any amendment or waiver effected in accordance with this Section 7.03 shall be binding upon Company and the Investor, including
their respective successors and assigns.

 

Section 7.04Entire
Agreement. This Agreement, the exhibits and schedules hereto, the other Transaction Documents, the certificates and the
other documents delivered pursuant hereto constitute the entire agreement among the parties relative to the specific subject matter
hereof and thereof.

 

Section 7.05Notices.
All notices required or permitted hereunder shall be in writing and shall be deemed effectively given: (a) upon personal delivery
to the party to be notified; (b) when sent by confirmed electronic mail or facsimile if sent during normal business hours of the
recipient, if not so confirmed, then on the next business day; (c) five days after having been sent by registered or certified
mail, return receipt requested, postage prepaid; or (d) the next business day after deposit with a nationally recognized overnight
courier, specifying next day delivery, with written verification of receipt. All communications shall be sent to the Company or
an Investor at the respective address or at its respective facsimile number set forth below or to such e-mail address, facsimile
number or address as subsequently modified by written notice in accordance with this Section 7.05 upon five (5) business days prior
written notice.

 

If to the Company, to:

 

Peerlogix, Inc.

119 West 24th Street,
4th Floor

New York, New York 10011

Attn: William Gorfein

Fax: _________________

 

With a copy (that shall not constitute notice)
to:

 

Mitchell Lampert, Esq.

Robinson & Cole, LLP

1055 Washington Blvd.

Stamford, Ct. 06901

Tel:

Fax:

 

If to Investor, to:

 

Pinewood Trading Fund, L.P.

1029 East Drive

Beaumont, Texas 77706

Attn: Jack E. Brooks

Fax:

 

    	 	7	 

     

    

 

With a copy (that shall not constitute notice)
to:

 

Foley & Lardner LLP

321 N Clark Street

Chicago, Illinois 60654

Telephone:

Fax:

 

Section 7.06Severability.
In the event one or more of the provisions of this Agreement should, for any reason, be held to be invalid, illegal or unenforceable
in any respect, such invalidity, illegality, or unenforceability shall not affect any other provisions of this Agreement, and this
Agreement shall be construed as if such invalid, illegal or unenforceable provision had never been contained herein.

 

Section 7.07Broker’s
Fees. Each party represents and warrants that, except as otherwise provided herein, no agent, broker, investment banker,
person or firm acting on behalf of or under the authority of such party is or will be entitled to any broker’s or finder’s
fee or any other commission directly or indirectly in connection with the transactions contemplated herein.

 

Section 7.08Counterparts.
This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together shall constitute
one and the same instrument.

 

Section 7.09Successors
and Assigns. The provisions hereof shall inure to the benefit of, and be binding upon, the successors and assigns of the
parties hereto.

 

Section 7.10Titles
and Subtitles. The titles of the sections and subsections of this Agreement are for convenience of reference only and are
not to be considered in construing this Agreement.

 

* * *

 

 

IN WITNESS WHEREOF,
the parties hereto have executed this Agreement as of the date set forth in the first paragraph hereof.

 

 

	 	
        Investor:

         

        PINEWOOD TRADING FUND, L.P.
	 	
        Company:

         

        PEERLOGIX, INC.

	 	By Sagewood, LLC General Partner	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	By:	_________________________	 	By:	_________________________
	 	Name: Jack Brooks	 	 	Name: 
	 	Title: Manager	 	 	Title: 

 

 

    	 	8	 

     

    

 

Exhibit A

 

Form of Registration Rights Agreement

 

See attached.

 

 

 

 

 

 

 

 

 

 

 

 

 

    	 	9

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