EXHIBIT 10.8
NAME OF SUBSCRIBER:_____________________________
To: GlobalOptions Group, Inc.
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SUBSCRIPTION AGREEMENT
This Subscription Agreement (this "Agreement") is being delivered to
you in connection with your investment in a publicly-traded company, which will
subsequently change its name to GlobalOptions Group, Inc. ("Pubco"), and the
anticipated merger (the "Merger") of GO Acquisition Corp., a wholly-owned
subsidiary of Pubco, with and into GlobalOptions, Inc., a Delaware corporation.
Your obligation to invest in Pubco shall be subject to, among other things, (a)
the notification to you of the identity of Pubco and (b) your receipt of draft
copy of Pubco's Current Report on Form 8-K (the "Draft Form 8-K") in accordance
with Section 2.1 below. Broadband Capital Management LLC (the "Placement Agent")
shall serve as the placement agent of Pubco in conducting a private placement
(the "Private Placement") of units ("Units"), each Unit consisting of (i) one
share of Pubco's Series A Convertible Preferred Stock ("Preferred Stock")
convertible to 500 shares of Pubco's common stock ("Common Stock") and (ii) a
detachable, four-year warrant to purchase 125 shares of Common Stock
("Warrant"), at an exercise price of $2.50 per share. The purchase price per
Unit is $1,000. All funds received in the Private Placement shall be held in
escrow by Signature Bank (the "Escrow Agent") and, upon fulfillment of the other
conditions precedent set forth herein, shall be released from escrow and
delivered to Pubco at which time the securities subscribed for as further
described below shall be delivered, subject to Section 8 hereof, to you.
1. SUBSCRIPTION AND PURCHASE PRICE
1.1 SUBSCRIPTION. Subject to the conditions set forth in Section 2
hereof, the undersigned hereby subscribes for and agrees to purchase the number
of Units indicated on page C-10 hereof on the terms and conditions described
herein. The minimum number of Units that may be purchased is twenty five (25).
Subscriptions for lesser amounts may be accepted at the discretion of Pubco and
the Placement Agent.
1.2 PURCHASE OF SECURITIES. The undersigned understands and
acknowledges that the purchase price to be remitted to the Placement Agent in
exchange for the Units shall be $1,000 per Unit, for an aggregate purchase price
as set forth on page C-10 hereof (the "Aggregate Purchase Price"). Payment for
the Units subscribed for hereunder shall be made by the undersigned, payable in
United States dollars, by check or wire transfer, to "Signature Bank, as Escrow
Agent for GlobalOptions Group, Inc.," with the undersigned's delivery of this
Agreement to the Placement Agent. The undersigned understands and agrees that,
subject to Sections 2.1(a) and applicable laws, by executing this Agreement, it
is entering into a binding agreement.
2. ACCEPTANCE AND CLOSING PROCEDURES
2.1 ACCEPTANCE OR REJECTION.
(a) The undersigned and the Placement Agent understand and
agree that this subscription shall be revocable by the undersigned up until
three (3) days after a Draft Form 8-K is prepared and sent to the undersigned
(at the address set forth on the signature page of this Agreement) in accordance
with the terms and conditions set forth in Section 5 hereof (the "Revocation
Period"). Provided that the undersigned shall not have, within the Revocation
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Period, delivered a written notice via facsimile to ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, LLP,
counsel to Pubco (to the attention of ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇) at (▇▇▇) ▇▇▇-▇▇▇▇ and
to the Placement Agent (to the attention of ▇▇▇▇ ▇▇▇▇▇▇) at (▇▇▇) ▇▇▇-▇▇▇▇,
electing to withdraw his subscription, the obligation of the undersigned to
purchase the Units shall become irrevocable, and the undersigned shall be
legally bound to purchase the Units subject to the terms set forth in this
Agreement.
(b) The undersigned understands and agrees that Pubco and the
Placement Agent reserve the right to reject this subscription for the Units in
whole or part in any order at any time prior to the closing (the "Closing") of
the purchase and sale of the Units if, in their reasonable judgment, they deem
such action to be in the best interest of Pubco, notwithstanding the
undersigned's prior receipt of notice of acceptance of the undersigned's
subscription.
(c) In the event of the revocation of this subscription by the
undersigned in accordance with Section 2.1(a), rejection by Pubco or the
Placement Agent in accordance with Section 2.1(b), or the sale of the Units is
not consummated by the Placement Agent for any reason, this Agreement and any
other agreement entered into between the undersigned and the Placement Agent
relating to this subscription shall thereafter have no force or effect, and the
Placement Agent shall promptly return or cause to be returned to the undersigned
the purchase price remitted to the Escrow Agent, without interest thereon or
deduction therefrom.
(d) Notwithstanding anything to the contrary contained in this
Agreement, in the event that the Merger is not effective on or before the date
that is twenty (20) days after the date of this Agreement, the Placement Agent
shall promptly return or cause to be returned to the undersigned the purchase
price remitted to the Escrow Agent, without interest thereon or deduction
therefrom.
2.2 CLOSING.
The Closing shall take place at the offices of ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, LLP, counsel to Pubco, at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇ ▇▇▇▇▇, or such other place as determined by the Placement Agent, on a
Business Day promptly following the Revocation Period (the "Closing Date"), or
such other date as is mutually agreed to by the parties and the undersigned.
"Business Day" shall mean from the hours of 9:00 a.m. (E.S.T.) through 5:00 p.m.
(E.S.T.) of a day other than a Saturday, Sunday or other day on which commercial
banks in New York City are authorized or required to be closed.
3. INVESTOR'S REPRESENTATIONS AND WARRANTIES
The undersigned hereby acknowledges, agrees with and represents
and warrants to Pubco and the Placement Agent and its affiliates, as follows:
(a) The undersigned has full power and authority to enter into
this Agreement, the execution and delivery of which has been duly authorized, if
applicable, and this Agreement constitutes a valid and legally binding
obligation of the undersigned.
(b) The undersigned acknowledges his understanding that the
offering and sale of the Units is intended to be exempt from registration under
the Securities Act of 1933, as amended (the "Securities Act"), by virtue of
Section 4(2) of the Securities Act and the provisions of Regulation D
promulgated thereunder ("Regulation D"). In furtherance thereof, the undersigned
represents and warrants to Pubco and the Placement Agent and its affiliates as
follows:
(i) The undersigned realizes that the basis for the
exemption from registration may not be available if,
notwithstanding the undersigned's representations contained
herein, the undersigned is merely acquiring the Units for a
fixed or determinable period in the future, or for a market
rise, or for sale if the market does not rise. The undersigned
does not have any such intention.
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(ii) The undersigned is acquiring the Unit(s) solely for
the undersigned's own beneficial account, for investment
purposes, and not with view to, or resale in connection with,
any distribution of the shares of Preferred Stock, or shares
of Common Stock into which the Preferred Stock is converted
and the Warrants are exercised.
(iii) The undersigned has the financial ability to bear
the economic risk of his investment, has adequate means for
providing for his current needs and contingencies, and has no
need for liquidity with respect to his investment in Pubco;
(iv) The undersigned and the undersigned's attorney,
accountant, purchaser representative and/or tax advisor, if
any (collectively, "Advisors"), have received the Confidential
Private Placement Memorandum, dated April 18, 2005, together
with all annexes thereto (as such documents may be amended or
supplemented, the "Memorandum"), relating to the private
placement by Pubco of the Units, and all other documents
requested by the undersigned or his Advisors, if any, have
carefully reviewed them and understand the information
contained therein, prior to the execution of this Agreement;
and
(v) The undersigned (together with his Advisors, if any)
has such knowledge and experience in financial and business
matters as to be capable of evaluating the merits and risks of
the prospective investment in the Units. If other than an
individual, the undersigned also represents it has not been
organized for the purpose of acquiring the Units.
(c) The information in the Investor Questionnaire completed and
executed by the undersigned (the "Investor Questionnaire") is accurate and true
in all respects, and the undersigned is an "accredited investor," as that term
is defined in Rule 501(a) of Regulation D.
(d) The undersigned (and his Advisors, if any) has been
furnished with a copy of the Memorandum.
(e) The undersigned is not relying on the Placement Agent or
its affiliates with respect to economic considerations involved in this
investment. The undersigned has relied on the advice of, or has consulted with,
only his Advisors. Each Advisor, if any, is capable of evaluating the merits and
risks of an investment in the Units as such are described in the Memorandum, and
each Advisor, if any, has disclosed to the undersigned in writing (a copy of
which is annexed to this Agreement) the specific details of any and all past,
present or future relationships, actual or contemplated, between himself and the
Placement Agent or any affiliate or subsidiary thereof.
(f) The undersigned represents, warrants and agrees that he
will not sell or otherwise transfer the shares of Preferred Stock and Warrants
(including such shares of Common Stock into which the Preferred Stock and
Warrants are convertible or exercisable, as appropriate, and collectively with
the Preferred Stock and the Warrants, the "Securities") without registration
under the Securities Act or an exemption therefrom, and fully understands and
agrees that he must bear the economic risk of his purchase because, among other
reasons, the Securities have not been registered under the Securities Act or
under the securities laws of any state and, therefore, cannot be resold,
pledged, assigned or otherwise disposed of unless they are subsequently
registered under the Securities Act and under the applicable securities laws of
such states, or an exemption from such registration is available. In particular,
the undersigned is aware that the Securities are "restricted securities," as
such term is defined in Rule 144 promulgated under the Securities Act ("Rule
144"), and they may not be sold pursuant to Rule 144 unless all of the
conditions of Rule 144 are met. The undersigned also understands that, except as
otherwise provided herein, Pubco is under no obligation to register the
Securities on his behalf or to assist him in complying with any exemption from
registration under the Securities Act or applicable state securities laws. The
undersigned understands that any sales or transfers of the Securities are
further restricted by state securities laws and the provisions of this
Agreement.
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(g) No representations or warranties have been made to the
undersigned by Pubco, GlobalOptions or the Placement Agent, or any of their
respective officers, employees, agents, affiliates or subsidiaries, other than
any representations of Pubco or the Placement Agent contained herein and in the
Memorandum, and in subscribing for Units the undersigned is not relying upon any
representations other than any contained herein or in the Memorandum.
(h) The undersigned understands and acknowledges that his
purchase of the Units is a speculative investment that involves a high degree of
risk and the potential loss of his entire investment and has carefully read and
considered the matters set forth in the Memorandum and in particular the matters
under the caption "Risk Factors" therein, and, in particular, acknowledges that
Pubco is engaged in a highly competitive business.
(i) The undersigned's overall commitment to investments that
are not readily marketable is not disproportionate to the undersigned's net
worth, and an investment in the Units will not cause such overall commitment to
become excessive.
(j) The undersigned understands and agrees that the
certificates for the Securities shall bear substantially the following legend
until (i) such securities shall have been registered under the Securities Act
and effectively disposed of in accordance with a registration statement that has
been declared effective or (ii) in the opinion of counsel for Pubco such
securities may be sold without registration under the Securities Act as well as
any applicable "blue sky" or state securities laws:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR ANY APPLICABLE STATE SECURITIES LAWS. SUCH SECURITIES HAVE BEEN ACQUIRED FOR
INVESTMENT PURPOSES AND MAY NOT BE OFFERED FOR SALE, SOLD, DELIVERED AFTER SALE,
TRANSFERRED, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT FILED BY THE ISSUER WITH THE SECURITIES AND EXCHANGE COMMISSION
COVERING SUCH SECURITIES UNDER THE SECURITIES ACT OR AN OPINION OF COUNSEL
SATISFACTORY TO THE ISSUER THAT SUCH REGISTRATION IS NOT REQUIRED.
(k) Neither the U.S. Securities and Exchange Commission (the
"SEC") nor any state securities commission has approved the Units or the
Securities, or passed upon or endorsed the merits of the Offering or confirmed
the accuracy or determined the adequacy of the Memorandum. The Memorandum has
not been reviewed by any Federal, state or other regulatory authority.
(l) The undersigned and his Advisors, if any, have had a
reasonable opportunity to ask questions of and receive answers from a person or
persons acting on behalf of Pubco concerning the offering of the Units and the
business, financial condition, results of operations and prospects of Pubco, and
all such questions have been answered to the full satisfaction of the
undersigned and his Advisors, if any.
(m) The undersigned is unaware of, is in no way relying on, and
did not become aware of the offering of the Units through or as a result of, any
form of general solicitation or general advertising including, without
limitation, any article, notice, advertisement or other communication published
in any newspaper, magazine or similar media or broadcast over television, radio
or over the Internet, in connection with the offering and sale of the Units and
is not subscribing for Units and did not become aware of the offering of the
Units through or as a result of any seminar or meeting to which the undersigned
was invited by, or any solicitation of a subscription by, a person not
previously known to the undersigned in connection with investments in securities
generally.
(n) The undersigned has taken no action which would give rise
to any claim by any person for brokerage commissions, finders' fees or the like
relating to this Agreement or the transactions contemplated hereby (other than
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commissions to be paid by Pubco to the Placement Agent or as otherwise described
in the Memorandum) and, in turn, to be paid to other selected dealers.
(o) The undersigned is not relying on Pubco, the Placement
Agent or any of their respective employees or agents with respect to the legal,
tax, economic and related considerations of an investment in the Units, and the
undersigned has relied on the advice of, or has consulted with, only his own
Advisors.
(p) The undersigned acknowledges that any estimates or
forward-looking statements or projections included in the Memorandum were
prepared by the future management of Pubco in good faith, but that the
attainment of any such projections, estimates or forward-looking statements
cannot be guaranteed by Pubco or its management and should not be relied upon.
(q) No oral or written representations have been made, or oral
or written information furnished, to the undersigned or his Advisors, if any, in
connection with the offering of the Units which are in any way inconsistent with
the information contained in the Memorandum.
(r) The undersigned's substantive relationship with the
Placement Agent or subagent through which the undersigned is subscribing for
Units predates the Placement Agent's or such subagent's contact with the
undersigned regarding an investment in the Units.
(s) The foregoing representations, warranties, and agreements
shall survive the Closing.
4. PUBCO'S REPRESENTATIONS AND WARRANTIES
Pubco hereby acknowledges, agrees with and represents and warrants
to each of the undersigned, as follows:
(a) Pubco has the corporate power and authority to execute and
deliver this Agreement and to perform its obligations hereunder. This Agreement
has been duly authorized, executed and delivered by Pubco and is valid, binding
and enforceable against Pubco in accordance with its terms.
(b) The Preferred Stock and Warrants to be issued to the
undersigned pursuant to this Agreement, when issued and delivered in accordance
with the terms of this Agreement, will be duly and validly issued and will be
fully paid and nonassessable.
(c) Neither the execution and delivery nor the performance of
this Agreement by Pubco will conflict with Pubco's Articles of Incorporation, as
amended, or By-laws, or result in a breach of any terms or provisions of, or
constitute a default under, any material contract, agreement or instrument to
which Pubco is a party or by which Pubco is bound.
(d) After giving effect to the transactions contemplated by
this Agreement and immediately after the Closing, Pubco will have the
outstanding capital stock as described in the Memorandum.
(e) The information contained in the Memorandum is true and
correct in all material respects as of its date.
5. COVENANTS
5.1 PREPARATION AND DELIVERY OF THE DRAFT FORM 8-K; WITHDRAWAL OF
SUBSCRIPTION. At least three (3) days prior to the date of closing of the
Merger, Pubco shall prepare and deliver to the undersigned via overnight courier
or facsimile, the Draft Form 8-K proposed to be filed by Pubco, which shall
describe the terms and conditions of the Merger, in accordance with the
requirements of the Securities Exchange Act of 1934 and the Accounting and
Financial Reporting Interpretations and Guidance issued by the accounting staff
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members of the Division of Corporate Finance of the Securities and Exchange
Commission on March 31, 2001, as the same relates to "Reverse
Acquisitions-Reporting Issues."
5.2 REGISTRATION RIGHTS; LOCK-UP.
(a) Pubco shall file a registration statement (the
"Registration Statement") with the SEC covering the resale of the shares of
Common Stock into which the Preferred Stock and Warrants are convertible or
exercisable, as appropriate, on or around, but no later than, one hundred and
twenty (120) days after the Closing Date. Pubco shall use its best efforts to
have the Registration Statement declared effective by the SEC as soon as
possible after the initial filing, and agrees to respond to the SEC, within
thirty (30) days of receipt, to all questions and comments from the SEC
regarding the Registration Statement. Pubco will maintain the effectiveness of
the Registration Statement from the date of the effectiveness of the
Registration Statement until one (1) year after that date; PROVIDED that, if at
any time or from time to time after the date of effectiveness of the
Registration Statement, Pubco notifies the undersigned in writing of the
existence of a Potential Material Event (as defined below), the undersigned
shall not offer or sell any of the Securities, or engage in any other
transaction involving or relating to the Securities, from the time of the giving
of notice with respect to a Potential Material Event until Pubco notifies the
undersigned that such Potential Material Event either has been disclosed to the
public or no longer constitutes a Potential Material Event; PROVIDED, FURTHER
that, Pubco may not suspend the right of the undersigned pursuant to this
Section 5.2(a) for more than sixty (60) days in the aggregate. "Potential
Material Event" means the possession by Pubco of material information regarding
a potential transaction not ripe for disclosure in a registration statement,
which shall be evidenced by determinations in good faith by the Board of
Directors of Pubco that disclosure of such information in the registration
statement would be detrimental to the business and affairs of Pubco.
(b) If Pubco fails to (i) file the Registration Statement with
the SEC on or prior to one hundred and eighty (180) days after the Closing Date,
or (ii) subject to Section 5.2(a), maintain the effectiveness of the
Registration Statement from date of the effectiveness of the Registration
Statement until one (1) year after that date, Pubco shall be obligated to issue
to the undersigned additional shares of Preferred Stock computed as follows: on
the first day that Pubco has failed to file, or to maintain the effectiveness
of, the Registration Statement, as the case may be (the "First Determination
Date"), Pubco shall determine the number of shares of Preferred Stock entitled
(by virtue of the underlying shares of Common Stock to be registered) to the
benefit of the registration rights set forth in this Section 5.2 that are held
by the undersigned (the "Subject Securities"). Within sixty (60) days following
the First Determination Date, Pubco shall issue to the undersigned such number
of shares of Preferred Stock equal to 2% of number of shares of Subject
Securities (the "Penalty Shares"). Penalty Shares shall also be issuable upon
the expiration of each 30-day period following the First Determination Date
during which Pubco has continued to fail to obtain effectiveness of, or maintain
effectiveness of, the Registration Statement, as the case may be (the expiration
date of each such 30-day period being a "Subsequent Determination Date"). The
number of Penalty Shares issuable following each Subsequent Determination Date
shall be determined and issued in accordance with this section on the same basis
applicable to the First Determination Date; PROVIDED, HOWEVER, that Penalty
Shares previously issued to the undersigned shall be excluded from the
calculation of Subject Securities. Notwithstanding the foregoing, Pubco shall
not be obligated to issue pursuant to this paragraph to the undersigned an
aggregate number of Penalty Shares greater than 20% of the number of shares of
Subject Securities originally subscribed for and held by the undersigned.
(c) If Pubco fails to respond to the SEC, within thirty (30)
days of receipt, to any questions and comments from the SEC regarding the
Registration Statement, Pubco shall be obligated to issue Penalty Shares to the
undersigned. The thirty-first (31st) day that Pubco has failed to respond to the
SEC is termed the "Response Determination Date." Within sixty (60) days
following the Response Determination Date, Pubco shall issue to the undersigned
Penalty Shares (which are equal to 2% of the number of shares of Subject
Securities). Penalty Shares shall also be issuable upon the expiration of each
30-day period following the Response Determination Date during which Pubco has
continued to fail to respond to the SEC (the expiration date of each such 30-day
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period being a "Subsequent Response Determination Date"). The number of Penalty
Shares issuable following each Subsequent Response Determination Date shall be
determined and issued in accordance with this section on the same basis
applicable to the Response Determination Date; PROVIDED, HOWEVER, that Penalty
Shares previously issued to the undersigned shall be excluded from the
calculation of Subject Securities. Notwithstanding the foregoing, Pubco shall
not be obligated to issue pursuant to this paragraph to the undersigned an
aggregate number of Penalty Shares greater than 20% of the number of shares of
Subject Securities originally subscribed for and held by the undersigned.
(d) Pubco shall notify the undersigned at any time when a
prospectus relating thereto is required to be delivered under the Securities
Act, upon discovery that, or upon the happening of any event as a result of
which, the prospectus included in such registration statement, as then in
effect, includes an untrue statement of a material fact or omits to state any
material fact required to be stated therein or necessary to make the statements
therein not misleading in light of the circumstances then existing. At the
request of the undersigned, Pubco shall also prepare, file and furnish to the
undersigned a reasonable number of copies of a supplement to or an amendment of
such prospectus as may be necessary so that, as thereafter delivered to the
purchasers of such shares, such prospectus shall not include an untrue statement
of a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading in light of
the circumstances then existing. The undersigned agrees not to offer or sell any
shares covered by the Registration Statement after receipt of such notification
until the receipt of such supplement or amendment.
(e) Pubco may request the undersigned to furnish Pubco such
information with respect to the undersigned and the undersigned's proposed
distribution of Securities pursuant to the Registration Statement as Pubco may
from time to time reasonably request in writing or as shall be required by law
or by the SEC in connection therewith, and the undersigned agrees to furnish
Pubco with such information.
5.3 BUSINESS OPPORTUNITY AGREEMENT. Prior to the Closing,
GlobalOptions, Inc. shall have obtained the written agreement of ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇, Ph.D., which agreement shall remain in force during ▇▇. ▇▇▇▇▇▇▇▇'▇
employment with GlobalOptions, Inc. or Pubco, to bring to GlobalOptions, Inc.
any corporate opportunity, business opportunity, proposed transaction,
acquisition, disposition, participation, interest or other opportunity to
acquire an interest in any risk mitigation or security-related business or
prospect (a "business opportunity") that becomes available to him or any entity
under his control. Pursuant to this agreement, GlobalOptions, Inc. has a 30-day
right of first refusal with respect to any business opportunity that becomes
available to ▇▇. ▇▇▇▇▇▇▇▇.
6. USE OF PROCEEDS
Pubco shall use the net proceeds from the offering of the Units to
pursue its strategy of acquiring complementary businesses in the areas of risk
mitigation, security, investigations and crisis management, and as otherwise set
forth in the Memorandum. Upon receipt of the proceeds of this Offering from the
Escrow Agent, Pubco shall deposit and maintain the net proceeds in a segregated
bank account and funds shall be released into Pubco's operating account in a
manner consistent with foregoing plan and upon periodic authorization from the
Board of Directors of Pubco.
7. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ PROHIBITION; INDEMNITY
(a) Commencing as of the date upon which the Draft Form 8-K is
sent to the undersigned and until the filing by Pubco of the Form 8-K with the
SEC, the undersigned hereby agrees to (i) refrain from (a) engaging in any
transactions with respect to the capital stock of Pubco or securities
exercisable or convertible into or exchangeable for any shares of capital stock
of Pubco, and (b) entering into any transaction which would have the same
effect, or entering into any swap, hedge or other arrangement that transfers, in
whole or in part, any of the economic consequences of ownership of the capital
stock of Pubco and (ii) indemnify and hold harmless Pubco, the Placement Agent,
and their respective officers and directors, employees and affiliates and each
other person, if any, who controls any of the foregoing, against any loss,
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liability, claim, damage and expense whatsoever (including, but not limited to,
any and all expenses whatsoever reasonably incurred in investigating, preparing
or defending against any litigation commenced or threatened or any claim
whatsoever) arising out of or based upon any violation of this Section 7 by the
undersigned.
(b) The undersigned agrees to indemnify and hold harmless
Pubco, the Placement Agent, the Escrow Agent and their respective officers and
directors, employees and affiliates and each other person, if any, who controls
any of the foregoing, against any loss, liability, claim, damage and expense
whatsoever (including, but not limited to, any and all expenses whatsoever
reasonably incurred in investigating, preparing or defending against any
litigation commenced or threatened or any claim whatsoever) arising out of or
based upon any false representation or warranty by the undersigned, or the
undersigned's breach of, or failure to comply with, any covenant or agreement
made by the undersigned herein or in any other document furnished by the
undersigned to Pubco, its officers and directors, employees and its affiliates
and each other person, if any, who controls any of the foregoing in connection
with this transaction.
8. MISCELLANEOUS PROVISIONS
8.1 MODIFICATION. Neither this Agreement, nor any provisions hereof,
shall be waived, modified, discharged or terminated except by an instrument in
writing signed by the party against whom any waiver, modification, discharge or
termination is sought.
8.2 NOTICES. Any party may send any notice, request, demand, claim
or other communication hereunder to the undersigned at the address set forth on
the signature page of this Agreement or to Pubco at the address set forth above
using any means (including personal delivery, expedited courier, messenger
service, fax, ordinary mail or electronic mail), but no such notice, request,
demand, claim or other communication will be deemed to have been duly given
unless and until it actually is received by the intended recipient. Any party
may change the address to which notices, requests, demands, claims and other
communications hereunder are to be delivered by giving the other parties written
notice in the manner herein set forth.
8.3 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
8.4 BINDING EFFECT. Except as otherwise provided herein, this
Agreement shall be binding upon, and inure to the benefit of, the parties to
this Agreement and their heirs, executors, administrators, successors, legal
representatives and assigns. If the undersigned is more than one person or
entity, the obligation of the undersigned shall be joint and several and the
agreements, representations, warranties and acknowledgments contained herein
shall be deemed to be made by, and be binding upon, each such person or entity
and his or its heirs, executors, administrators, successors, legal
representatives and assigns.
8.5 ASSIGNABILITY. This Agreement is not transferable or assignable
by the undersigned. This Agreement shall be transferable or assignable by the
Placement Agent to Pubco.
8.6 GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with the laws of the State of New York, without giving effect to
conflicts of law principles.
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ANTI-MONEY LAUNDERING REQUIREMENTS
THE USA PATRIOT ACT WHAT IS MONEY HOW BIG IS THE PROBLEM
LAUNDERING? AND WHY IS IT IMPORTANT?
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The USA PATRIOT Act is Money laundering is the The use of the U.S. financial
designed to detect, deter, process of disguising illegally system by criminals to
and punish terrorists in the obtained money so that the facilitate terrorism or other
United States and abroad. funds appear to come from crimes could taint our
The Act imposes new anti- legitimate sources or financial markets. According
money laundering activities. Money laundering to the U.S. State
requirements on brokerage occurs in connection with a Department, one recent
firms and financial wide variety of crimes, estimate puts the amount of
institutions. Since April 24, including illegal arms sales, worldwide money laundering
2002, all brokerage firms drug trafficking, robbery, activity at $1 trillion a year.
have been required to have fraud, racketeering, and
new, comprehensive anti- terrorism.
money laundering programs.
To help you understand
these efforts, we want to
provide you with some
information about money
laundering and our steps to
implement the USA PATRIOT
Act.
WHAT ARE WE REQUIRED TO DO TO ELIMINATE MONEY LAUNDERING?
Under new rules required by the USA As part of our required program, we may ask
PATRIOT Act, our anti-money laundering you to provide various identification
program must designate a special compliance documents or other information. Until you
officer, set up employee training, conduct provide the information or documents we
independent audits, and establish policies and need, we may not be able to effect any
procedures to detect and report suspicious transactions for you.
transactions and ensure compliance with the
new laws.
C-9
ALL SUBSCRIBERS MUST COMPLETE THIS PAGE
IN WITNESS WHEREOF, the undersigned has executed this Agreement on the ____
day of ____________ 2005.
________________________ X $1,000 for each Unit = $________________________.
Units subscribed for Aggregate Purchase Price
Manner in which Title is to be held (Please Check ONE):
1. ___ Individual 7. ___ Trust/Estate/Pension or Profit sharing Plan
Date Opened:______________
2. ___ Joint Tenants with Right of 8. ___ As a Custodian for
Survivorship ___________________________________________
Under the Uniform Gift to Minors Act of the
State of
___________________________________________
3. ___ Community Property 9. ___ Married with Separate Property
4. ___ Tenants in Common 10. ___ ▇▇▇▇▇
5. ___ Corporation/Partnership/ 11. ___ Tenants by the Entirety
Limited Liability Company
6. ___ ▇▇▇
IF MORE THAN ONE SUBSCRIBER, EACH SUBSCRIBER MUST SIGN.
INDIVIDUAL SUBSCRIBERS MUST COMPLETE PAGE C-11.
SUBSCRIBERS WHICH ARE ENTITIES MUST COMPLETE PAGE C-12.
C-10
EXECUTION BY NATURAL PERSONS
--------------------------------------------------------------------------------
Exact Name in Which Title is to be Held
----------------------------------- -----------------------------------
Name (Please Print) Name of Additional Purchaser
----------------------------------- -----------------------------------
Residence: Number and Street Address of Additional Purchaser
----------------------------------- -----------------------------------
City, State and Zip Code City, State and Zip Code
----------------------------------- -----------------------------------
Social Security Number Social Security Number
----------------------------------- -----------------------------------
Telephone Number Telephone Number
----------------------------------- -----------------------------------
Fax Number (if available) Fax Number (if available)
----------------------------------- -----------------------------------
E-Mail (if available) E-Mail (if available)
----------------------------------- -----------------------------------
(Signature) (Signature of Additional Purchaser)
ACCEPTED this ___ day of _________ 2005, on behalf of Pubco.
By: ________________________________
Name:
Title:
By: ________________________________
Name:
Title:
C-11
EXECUTION BY SUBSCRIBER WHICH IS AN ENTITY
------------------------------------------
(Corporation, Partnership, Trust, Etc.)
--------------------------------------------------------------------------------
Name of Entity (Please Print)
Date of Incorporation or Organization:__________________________________________
State of Principal Office:______________________________________________________
Federal Taxpayer Identification Number:_________________________________________
____________________________________________
Office Address
____________________________________________
City, State and Zip Code
____________________________________________
Telephone Number
____________________________________________
Fax Number (if available)
____________________________________________
E-Mail (if available)
By: _________________________________
Name:
Title:
[seal]
_________________________________
Attest:__________________________________
(If Entity is a Corporation)
__________________________________
Address
ACCEPTED this ____ day of __________ 2005, on behalf of Pubco.
By:_______________________________
Name:
Title:
C-12
INVESTOR QUESTIONNAIRE
INSTRUCTIONS: CHECK ALL BOXES BELOW WHICH CORRECTLY DESCRIBE YOU.
|_| You are (I) a bank, as defined in Section 3(a)(2) of the Securities
Act of 1933, as amended (the "SECURITIES ACT"), (II) a savings and
loan association or other institution, as defined in Section
3(a)(5)(A) of the Securities Act, whether acting in an individual
or fiduciary capacity, (III) a broker or dealer registered pursuant
to Section 15 of the Securities Exchange Act of 1934, as amended
(the "EXCHANGE ACT"), (IV) an insurance company as defined in
Section 2(13) of the Securities Act, (V) an investment company
registered under the Investment Company Act of 1940, as amended
(the "INVESTMENT COMPANY ACT"), (VI) a business development company
as defined in Section 2(a)(48) of the Investment Company Act, (VII)
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, as amended, (VIII) a plan
established and maintained by a state, its political subdivisions,
or an agency or instrumentality of a state or its political
subdivisions, for the benefit of its employees and you have total
assets in excess of $5,000,000, or (IX) an employee benefit plan
within the meaning of the Employee Retirement Income Security Act
of 1974, as amended ("ERISA") and (1) the decision that you shall
subscribe for and purchase units consisting of one (1) share of
Series A Convertible Preferred Stock and a three-year detachable
warrant to purchase shares of common stock (the "Units"), is made
by a plan fiduciary, as defined in Section 3(21) of ERISA, which is
either a bank, savings and loan association, insurance company, or
registered investment adviser, (2) you have total assets in excess
of $5,000,000 and the decision that you shall subscribe for and
purchase the Units is made solely by persons or entities that are
accredited investors, as defined in Rule 501 of Regulation D
promulgated under the Securities Act ("REGULATION D") or (3) you
are a self-directed plan and the decision that you shall subscribe
for and purchase the Units is made solely by persons or entities
that are accredited investors.
|_| You are a private business development company as defined in
Section 202(a)(22) of the Investment Advisers Act of 1940, as
amended.
|_| You are an organization described in Section 501(c)(3) of the
Internal Revenue Code of 1986, as amended (the "CODE"), a
corporation, Massachusetts or similar business trust or a
partnership, in each case not formed for the specific purpose of
making an investment in the Units and with total assets in excess
of $5,000,000.
|_| You are a director or executive officer of GlobalOptions Group,
Inc.
|_| You are a natural person whose individual net worth, or joint net
worth with your spouse, exceeds $1,000,000 at the time of your
subscription for and purchase of the Units.
|_| You are 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
your spouse in excess of $300,000 in each of the two most recent
years, and who has a reasonable expectation of reaching the same
income level in the current year.
|_| You are a trust, with total assets in excess of $5,000,000, not
formed for the specific purpose of acquiring the Units, whose
subscription for and purchase of the Units is directed by a
sophisticated person as described in Rule 506(b)(2)(ii) of
Regulation D.
|_| You are an entity in which all of the equity owners are persons or
entities described in one of the preceding paragraphs.
C-13
The undersigned hereby represents and warrants that all of its
answers to this Investor Questionnaire are true as of the date of its execution
of the Subscription Agreement pursuant to which it purchased securities of
Pubco.
__________________________________________ ____________________________________
Name of Purchaser [please print] Name of Co-Purchaser [please print]
__________________________________________ ____________________________________
Signature of Purchaser (Entities please Signature of Co-Purchaser
provide signature of Purchaser's duly
authorized signatory.)
_________________________________________
Name of Signatory (Entities only)
_________________________________________
Title of Signatory (Entities only)
C-14
