SUBSCRIPTION AGREEMENT
EXHIBIT
NO. 4.1
COMMON
STOCK PURCHASE AGREEMENT (this
“Agreement”)
made
as of this 19th
day of
October 2006 between MSGI Security Solutions, Inc., a corporation organized
under the laws of the State of Nevada (the “Company”),
and
Hyundai Syscomm Corp, a California corporation (“HYUNDAI”).
WHEREAS,
the Company and HYUNDAI have entered into a certain license agreement, dated
September 11, 2006, pursuant to which, among other things, the Company is
licensing certain intellectual property to HYUNDAI (the “License
Agreement”);
WHEREAS,
the Company and HYUNDAI are entering into a certain sub-contracting agreement,
dated as of the date hereof, pursuant to which, among other things, HYUNDAI
is
retaining the Company as a sub-contractor and for the exploitation of the
Company’s services (the “Sub-Contracting
Agreement”);
WHEREAS,
in connection with the License Agreement and the Sub-Contracting Agreement
the
Company desires to issue to Purchaser, as an “accredited investor” (the
“Issuance”)
900,000 shares of the Company's Common Stock, par value $0.01 (the "Common
Stock")
on the
terms and conditions set forth herein, and HYUNDAI desires to acquire the
900,000 shares of Common Stock; and
WHEREAS,
the Company and HYUNDAI are entering into a certain registration rights
agreement, dated as of the date hereof, pursuant to which, among other things,
the Company has granted HYUNDAI certain registration rights (the “Registration
Rights Agreement”).
NOW,
THEREFORE, for and in consideration of the premises and the mutual covenants
hereinafter set forth, the parties hereto do hereby agree as
follows:
I.
SUBSCRIPTION
FOR COMMON STOCK AND REPRESENTATIONS BY AND COVENANTS OF
PURCHASER
1.1. Subscription
for Common Stock.
Subject
to the terms and conditions hereinafter set forth, HYUNDAI hereby subscribes
for
and agrees to purchase from the Company 900,000 shares of Common Stock in
exchange for the consideration set forth in 1.3 hereof.
1.2. 19.99%
Limitation.
HYUNDAI
hereby agrees that the Company shall not be required to issue, or reserve for
issuance at any time in accordance with Nasdaq rule 4350(i), in the aggregate,
Common Stock equal to more than 19.99% of the Company's Common Stock outstanding
(on a pre-transaction basis). Therefore the Company can issue 865,000 shares
of
Common Stock at the initial Closing, and the remaining 35,000 shares of Common
Stock shall be issued when and if: (a) the holders of a majority of the shares
of Common Stock outstanding vote in favor of HYUNDAI owning more than 19.99%
of
the Company’s Common Stock outstanding; or
(b)
additional issuances of Common Stock by the Company permit such issuance in
accordance with Nasdaq rule 4350(i).
1.3. Purchase
Price.
The
Common Stock shall be issued in exchange for (i) the receipt of $500,000
received in connection with the License Agreement, and (ii) the Sub-Contracting
Agreement.
1.4. Reliance
on Exemptions.
HYUNDAI
acknowledges that the Issuance has not been reviewed by the United States
Securities and Exchange Commission (the “SEC”)
or any
state agency because of the Company’s representations that this is intended to
be a nonpublic offering exempt from the registration requirements of the
Securities Act of 1933, as amended (the “1933
Act”)
and
state securities laws. HYUNDAI understands that the Company is relying in part
upon the truth and accuracy of, and HYUNDAI’s compliance with, the
representations, warranties, agreements, acknowledgments and understandings
of
HYUNDAI set forth herein in order to determine the availability of such
exemptions and the eligibility of HYUNDAI to acquire the Common
Stock.
1.5. Investment
Purpose.
HYUNDAI
represents that the Common Stock is being purchased for its own account, for
investment purposes only and not for distribution or resale to others in
contravention of the registration requirements of the 1933 Act. HYUNDAI agrees
that it will not sell or otherwise transfer the Common Stock (except to an
affiliate which agrees to comply with all provisions of this Agreement), unless
they are registered under the 1933 Act or unless an exemption from such
registration is available.
1.6. Accredited
Investor.
HYUNDAI
represents and warrants that it is an “accredited investor” as such term is
defined in Rule 501 of Regulation D promulgated under the 1933 Act and that
it
is able to bear the economic risk of an investment in the Common Stock.
1.7. Risk
of Investment.
HYUNDAI
recognizes that the purchase of the Common Stock involves a high degree of
risk
in that: (i) an investment in the Company is highly speculative and only
investors who can afford the loss of their entire investment should consider
investing in the Company and the Common Stock; (ii) transferability of the
Common Stock is limited; and (iii) the Company may require substantial
additional funds to operate its business and there can be no assurance that
adequate funds will be available to the Company, in addition to all of the
other
risks set forth in the SEC Documents (as defined in Section 1.8 hereof). HYUNDAI
acknowledges the disclosure relating to the risks affecting the Company set
forth in the SEC Documents.
1.8. Information.
HYUNDAI
acknowledges that the Company has made available for its review: (a) the
Company’s Annual Report on Form 10-K for the year ended June 30, 2005, (b) the
Company’s Quarterly Reports, on Form 10-Q for the fiscal quarters ended December
31, 2004, March 31, 2005, September 30, 2005, and March 31, 2006 (c) the
Company’s Proxy Statements, Definitive Information Statements, Current Reports
on Form 8-k, as filed with the SEC between December 31, 2004 and the date of
this Subscription Agreement (collectively the “SEC
Documents”)
and
hereby represents that: (i) HYUNDAI has been furnished by the Company during
the
course of this transaction with all information regarding the Company which
it
has requested; and (ii) that HYUNDAI has been afforded the opportunity to ask
questions of and receive answers from duly authorized officers of the Company
concerning the terms and conditions of the Placement, and any additional
information which it has requested, if any.
1.9. No
Representations.
HYUNDAI
hereby represents that, except as expressly set forth in (a) this Subscription
Agreement, (b) the Common Stock, (c) the License Agreement, (d) the
Sub-Contracting Agreement, (e) the Registration Rights Agreement and (g) all
exhibits, schedules and appendices which are part of the aforementioned
documents, (collectively, the “Offering
Documents”),
no
representations or warranties have been made to HYUNDAI by the Company or any
agent, employee or affiliate of the Company, and in entering into this
transaction HYUNDAI is not relying on any information other than that contained
in the Offering Documents, the SEC Documents and the results of independent
investigation by HYUNDAI.
1.10. Tax
Consequences.
HYUNDAI
acknowledges that the Issuance may involve tax consequences and that the
contents of the Offering Documents do not contain tax advice or information.
HYUNDAI acknowledges that it must retain its own professional advisors to
evaluate the tax and other consequences of an investment in the Common
Stock.
1.11. Transfer
or Resale.
HYUNDAI
understands that Rule 144 (the “Rule”)
promulgated under the 1933 Act requires, among other conditions, a one-year
holding period prior to the resale (in limited amounts) of securities acquired
in a non-public offering without having to satisfy the registration requirements
under the 1933 Act. HYUNDAI understands and hereby acknowledges that the Company
is under no obligation to register the securities comprising the Common Stock
under the 1933 Act, with the exception of certain registration rights covering
the resale of the Common Stock set forth in the Registration Rights Agreement.
1.12. Legends.
HYUNDAI
understands that the certificates or other instrument representing the Common
Stock, until such time as they have been registered under the 1933 Act or,
if
earlier, until paragraph (k) of the Rule shall become applicable, shall bear
a
restrictive legend in substantially the following form (and a stop-transfer
order may be placed against transfer of such certificates or other
instruments):
THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE
SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN
THE
ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER
THE
SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS, OR
(B)
AN OPINION OF COUNSEL, IN A REASONABLY ACCEPTABLE FORM, THAT REGISTRATION IS
NOT
REQUIRED UNDER SAID ACT OR APPLICABLE STATE SECURITIES LAWS, OR (II) UNLESS
SOLD
PURSUANT TO RULE 144 UNDER SAID ACT.
The
legend set forth above shall be removed and the Company shall promptly issue
a
certificate or other instrument without such legend to the holder of the Common
Stock upon which it is stamped, if (a) such Common Stock is being sold by the
holder pursuant to an effective registration statement under the 1933 Act,
or
(b) such holder delivers to the Company an opinion of counsel, in a reasonably
satisfactory and acceptable form to the Company and its counsel directed to
the
Company or expressly providing that the Company may rely thereon, that a
disposition of the Common Stock is being made pursuant to an exemption from
such
registration.
1.13. No
General Solicitation.
HYUNDAI
represents that HYUNDAI was not induced to invest by any of the following:
(i)
any advertisement, article, notice or other communication published in any
newspaper, magazine or similar media or broadcast over the news or radio; and
(ii) any seminar or meeting whose attendees were invited by any general
solicitation or advertising.
1.14.
Validity; Enforcement. If HYUNDAI is a corporation,
partnership, trust or other entity, HYUNDAI represents and warrants that: (a)
it
is authorized and otherwise duly qualified to purchase and hold the Common
Stock; and (b) that this Subscription Agreement has been duly and validly
authorized, executed and delivered and constitutes the legal, binding and
enforceable obligation of HYUNDAI.
1.15.
Address.
HYUNDAI
hereby represents that the address of Purchaser furnished by HYUNDAI at the
end
of this Subscription Agreement is HYUNDAI’s principal business address.
1.16.
No Hedging Transactions.
HYUNDAI
hereby agrees not to engage in any Hedging Transaction until such time as the
Common Stock have been registered for resale under the 1933 Act or may otherwise
be sold in the public market without an effective registration statement under
the 1933 Act. “Hedging
Transaction”
means
any short sale (whether or not against the box) or any purchase, sale or grant
of any right (including, without limitation, any put or call option) with
respect to any security (other than a broad-based market basket or index) that
includes, relates to or derives any significant part of its value from the
Company’s Common Stock or any rights, warrants, options or other securities that
are convertible into, or exercisable or exchangeable for, Common
Stock.
1.17. Foreign
Purchaser.
HYUNDAI
is a United States person and is not a foreign purchaser.
1.18. NASD
Member.
HYUNDAI
acknowledges that if it not a Registered Representative of a NASD member firm.
II.
REPRESENTATIONS
BY THE COMPANY
The
Company represents and warrants to HYUNDAI, except as set forth in the SEC
Documents or the disclosure schedules, if any, attached hereto:
2.1. Securities
Law Compliance.
The
offer, offer for sale, and sale of the Common Stock have not been registered
under the 1933 Act. The Common Stock is to be offered, offered for sale and
sold
in reliance upon the exemptions from the registration requirements of Section
4
of the 1933 Act. The Company will use its commercially reasonable efforts to
conduct the Issuance in compliance with the requirements of Regulation D of
the
General Rules and Regulations under the 1933 Act and applicable state “blue sky”
laws, and the Company will file all appropriate notices of offering with the
SEC. The Company has prepared the Offering Documents. The Offering Documents
will not contain any untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in light of
the
circumstances in which they were made, not misleading.
2.2. Organization
and Qualification.
The
Company is duly organized and validly existing in good standing under the laws
of the State of Nevada, and has the requisite power and authorization to own
its
properties and to carry on its business as now being conducted. The Company
is
duly qualified as a foreign corporation to do business and is in good standing
in the State of New York and in every other jurisdiction in which its ownership
of property or the nature of the business conducted by it makes such
qualification necessary, except to the extent that the failure to be so
qualified or be in good standing would not have a Material Adverse Effect.
As
used in this Subscription Agreement, “Material
Adverse Effect”
means
any material adverse effect on the business, properties, assets, operations,
results of operations, financial condition or prospects of the Company, or
on
the transactions contemplated hereby, or by the other Offering Documents or
the
agreements and instruments to be entered into in connection herewith or
therewith, or on the authority or ability of the Company to perform its
obligations under the Offering Documents.
2.3. SEC
Documents; Financial Statements.
The SEC
Documents represent all reports, schedules, forms, statements and other
documents required to be filed by it since March 31, 2005 with the SEC pursuant
to the reporting requirements of the Securities Exchange Act of 1934 (the
“Exchange
Act”).
The
Company has made available to HYUNDAI or its representatives copies of the
SEC
Documents. As of their respective dates, the SEC Documents complied in all
material respects with the requirements of the Exchange Act and the rules and
regulations of the SEC promulgated thereunder applicable to the SEC Documents,
and none of the SEC Documents, at the time they were filed with the SEC,
contained any untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading. As of their respective dates, the financial statements of the
Company included in the SEC Documents complied as to form in all material
respects with applicable accounting requirements and the published rules and
regulations of the SEC with respect thereto. Such financial statements have
been
prepared in accordance with generally accepted accounting principles,
consistently applied, during the periods involved (except (a) as may be
otherwise indicated in such financial statements or the notes thereto, or (b)
in
the case of unaudited interim statements, to the extent they may exclude
footnotes or may be condensed or summary statements) and fairly present in
all
material respects the financial position of the Company as of the dates thereof
and the results of its operations and cash flows for the periods then ended
(subject, in the case of unaudited statements, to normal year-end audit
adjustments that would not be material). The Company has no reason to believe
its independent auditors will withhold their consent to the inclusion of their
audit opinion concerning the Company’s financial statements which are to be
included in any Registration Statement.
2.4. Absence
of Changes.
Since
March 31, 2006, other than as set forth in the SEC Documents and Schedule
2.4
to this
Subscription Agreement, the Company has not (i) incurred any debts, obligations
or liabilities, absolute, accrued, contingent or otherwise, whether due or
to
become due, except current liabilities incurred in the usual and ordinary course
of business and consistent with past practices, having individually or in the
aggregate a Material Adverse Effect, (ii) made or suffered any changes in its
contingent obligations by way of guaranty, endorsement (other than the
endorsement of checks for deposit in the usual and ordinary course of business),
indemnity, warranty or otherwise, (iii) discharged or satisfied any liens or
paid any obligation or liability other than current liabilities shown on the
balance sheet dated as of March 31, 2006, and current liabilities incurred
since
the date of the balance sheet dated as of March 31, 2006, in each case in the
usual and ordinary course of business and consistent with past practices, (iv)
mortgaged, pledged or subjected to lien any of its assets, tangible or
intangible, (v) sold, transferred or leased any of its assets except in the
usual and ordinary course of business and consistent with past practices, (vi)
cancelled or compromised any debt or claim, or waived or released any right,
of
material value, (vii) suffered any physical damage, destruction or loss (whether
or not covered by insurance) adversely affecting the properties, business or
prospects of the Company, (viii) entered into any transaction other than in
the
usual and ordinary course of business except for this Subscription Agreement
and
the other Offering Documents and the related agreements referred to herein
and
therein, (ix) declared or paid any dividends on or made any other distributions
with respect to, or purchased or redeemed, any of its outstanding equity
securities, (x) suffered or experienced any change in, or condition affecting,
its condition (financial or otherwise), properties, assets, liabilities,
business operations, results of operations or prospects other than changes,
events or conditions in the usual and ordinary course of its business and
consistent with past practices, having (either by itself or in conjunction
with
all such other changes, events and conditions) a Material Adverse Effect or
(xi)
made any change in the accounting principles, methods or practices followed
by
it or depreciation or amortization policies or rates theretofore adopted.
2.5. Title.
The
Company has good and marketable title to all properties and assets owned by
it,
free and clear of all liens, charges, encumbrances or restrictions, except
such
as are not significant or important in relation to the Company’s business; all
of the material leases and subleases under which the Company is the lessor
or
sublessor of properties or assets or under which the Company holds properties
or
assets as lessee or sublessee are in full force and effect, and the Company
is
not in default in any material respect with respect to any of the terms or
provisions of any of such leases or subleases, and no material claim has been
asserted by anyone adverse to rights of the Company as lessor, sublessor, lessee
or sublessee under any of the leases or subleases mentioned above, or affecting
or questioning the right of the Company to continued possession of the leased
or
subleased premises or assets under any such lease or sublease. The Company
owns
or leases all such properties as are necessary to its operations as described
in
the Offering Documents.
2.6. Proprietary
Rights.
The
Company owns, or is duly licensed to use or possess, or possesses exclusive
and
enforceable rights to use all patents, patent applications, trademarks, service
marks, copyrights, trade secrets, processes, formulations, technology or
know-how used in the conduct of its business (the “Proprietary
Rights”).
The
Company has not received any notice of any claims, nor does it have any
knowledge of any threatened claims, and knows of no facts which would form
the
basis of any claim, asserted by any person to the effect that the sale or use
of
any product or process now used or offered by the Company or proposed to be
used
or offered by the Company infringes on any patents or infringes upon the use
of
any such Proprietary Rights of another person and, to the best of the Company’s
knowledge, no others have infringed the Company’s Proprietary
Rights.
2.7. Litigation.
There
is no material action, suit, investigation, customer complaint, claim or
proceeding at law or in equity by or before any arbitrator, court, governmental
instrumentality or agency, self-regulatory organization or body or public board
now pending or, to the knowledge of the Company, threatened against the Company
of any of the Company’s officers or directors in their capacities as such (or
basis
2.8. Non-Defaults;
Non-Contravention.
Other
than as set forth in Schedule
2.8
to this
Subscription Agreement, the Company is not in violation of or default under,
nor
will the execution and delivery of this Subscription Agreement or any of the
other Offering Documents or consummation of the transactions contemplated herein
or therein result in a violation of or constitute a default in the performance
or observance of any obligation under: (i) its Certificate of Incorporation,
or
its By-laws; or (ii) any indenture, mortgage, contract, material purchase order
or other agreement or instrument to which the Company is a party or by which
it
or its property is bound; or (iii) any material order, writ, injunction or
decree of any court of any Federal, state, municipal or other governmental
department, commission, board, bureau, agency or instrumentality, domestic
or
foreign (including, to the Company’s knowledge, federal and state securities
laws and regulations).
2.9. Taxes.
The
Company has filed all tax returns that are required to be filed by it or
otherwise met its disclosure obligations to the relevant agencies and all such
returns are true and correct. The Company has paid or adequately provided for
all tax liabilities of the Company as reflected on such returns or pursuant
to
any assessments received by it or that it is obligated to withhold from amounts
owing to any employee, creditor or third party. The Company has properly accrued
all taxes required to be accrued by GAAP consistently applied. The income tax
returns of the Company have not been audited by any government or regulatory
authorities with- in the last five years. The Company has not waived any statute
of limitations with respect to taxes or agreed to any extension of time with
respect to any tax assessment or deficiency.
2.10. Compliance
With Laws; Licenses, Etc.
The
Company has not received notice of any violation of or noncompliance with any
laws, ordinances, regulations and orders applicable to its business that would
have a Material Adverse Effect and that has not been cured. The Company has
all
material licenses and permits and other governmental certificates,
authorizations and permits and approvals (collectively, “Licenses”)
required by every government or regulatory body for the operation of its
business as currently conducted and the use of its properties. The Licenses
are
in full force and effect and to the Company’s knowledge no violations currently
exist in respect of any License and no proceeding is pending or threatened
to
revoke or limit any thereof.
2.11. Authorization;
Enforcement; Validity.
The
Company has the requisite corporate power and authority to enter into and
perform its obligations under this Subscription Agreement and the other Offering
Documents, to file and perform its obligations under the Offering Documents,
and
to issue the Common Stock in accordance with the terms of the Offering
Documents. The execution and delivery of the Offering Documents by the Company
and the consummation by the Company of the transactions contemplated by the
Offering Documents, including without limitation the issuance of the Common
Stock hereunder, have been duly authorized by the Company’s board of directors.
This Subscription Agreement constitutes the legal, binding and enforceable
obligation of the Company.
2.12. Authorization
of Securities.
The
issuance, sale and delivery of the Common Stock has been duly authorized by
all
requisite corporate action of the Company. When so issued, sold and delivered
in
accordance with the Offering Documents for the consideration set forth therein,
the Common Stock will be duly executed, issued and delivered and will constitute
valid and legal obligations of the Company enforceable in accordance with their
respective terms and, in each case, will not be subject to preemptive or any
other similar rights of the stockholders of the Company or others which rights
shall not have been waived prior to the Closing.
2.13. Exemption
from Registration.
Assuming the accuracy of the information provided by HYUNDAI in this
Subscription Agreement, the offer and sale of the Common Stock pursuant to
the
terms of this Subscription Agreement are exempt from the registration
requirements of the 1933 Act and the rules and regulations promulgated
thereunder.
2.14. Brokers.
Neither
the Company nor any of its officers, directors, employees or stockholders has
employed any broker or finder in connection with the transactions contemplated
by the Offering Documents.
2.15. Title
to Securities.
When
the Common Stock has been duly delivered to HYUNDAI and full payment shall
have
been made therefore pursuant to Section 1.3 hereof and the terms of the Offering
Documents, HYUNDAI shall receive from the Company good and marketable title
to
such Common Stock free and clear of all liens, encumbrances and claims
whatsoever (with the exception of claims arising through the acts or omissions
of HYUNDAI and except as arising from applicable federal and state securities
laws), and the Company shall have paid all taxes, if any, in respect of the
original issuance thereof.
2.16. Consents.
Except
as contemplated by this Subscription Agreement, to the Company’s knowledge, the
Company is not required to obtain any consent, authorization or order of, or
make any filing or registration with, any court or governmental agency or any
regulatory or self-regulatory agency in order for it to execute, deliver or
perform any of its obligations under or contemplated by the Offering Documents.
Except as otherwise provided in the Offering Documents, all consents,
authorizations, orders, filings and registrations that the Company is required
to obtain pursuant to the preceding sentence have been obtained or effected
on
or prior to the date hereof. The Company is unaware of any facts or
circumstances that might prevent the Company from obtaining or effecting any
of
the foregoing.
2.17. No
General Solicitation.
None of
the Company, any of its affiliates, and, to the Company’s knowledge, any person
acting on its behalf, has engaged in any form of general solicitation or general
advertising (within the meaning of Regulation D under the 0000 Xxx) in
connection with the offer or sale of the Common Stock.
III. TERMS
OF PURCHASE
3.1. Closing
Date.
Provided
that all conditions to closing have been satisfied or waived, the closing (the
“Closing”)
shall
take place at the offices of counsel to the Company, Xxxxxxxxx Xxxxxxx LLP,
000
Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, or such other location as mutually agreed
to by the Company and HYUNDAI.
3.2. Certificates.
HYUNDAI
hereby authorizes and directs the Company to deliver the Common Stock to be
issued to HYUNDAI pursuant to this Subscription Agreement in the name and
address of HYUNDAI’s nominee, Alluser, Inc., 0000 Xxxxxx Xxxxxx, Xxxxx 000, Xxx
Xxxxx, Xxxxxxxxxx 00000, Att: Xxxxx Xxx.
IV. MISCELLANEOUS
4.1 Notice.
Any
notices, consents, waivers or other communications required or permitted to
be
given under the terms of this Subscription Agreement must be in writing and
will
be deemed to have been delivered: (a) upon receipt, when delivered personally,
(b) upon receipt, when sent by facsimile (provided confirmation of transmission
is mechanically or electronically generated and kept on file by the sending
party), or (c) one (1) business day after deposit with an overnight courier
service, in each case properly addressed to the party to receive the same.
The
addresses and facsimile numbers for such communications shall be:
If
to the
Company:
000
Xxxxxxx Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Telephone:
(000) 000-0000
Facsimile:
(000) 000-0000
Attention.:
Xxxxxx Xxxxxxx
With
a
copy to:
Xxxxxxxxx
Traurig, LLP
MetLife
Building
000
Xxxx
Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Telephone:
(000) 000-0000
Facsimile:
(000) 000-0000
Attention:
Xxxx X. Annex, Esq.
If
to
HYUNDAI:
Hyundai
Syscomm Corp.
000
Xxxxxxxx Xxxxxx
Xxxx
Xxxx, Xxxxxxxxxx 00000
Telephone:
(000) 000-0000
Facsimile:
(000) 000-0000
Attn.:
Xxxxxxxx Xxxx
With
a
copy to:
Xxxxxxxxxx
Law
0000
Xxxx
Xxxxxx
Xxxxx
0X
Xxx
Xxxx,
Xxx Xxxx 00000-0000
Telephone:
(000) 000-0000
Facsimile:
(000) 000-0000
Attention:
Xxxxx X. Xxxxxxxxxx, Esq.
4.2
Entire
Agreement; Amendment.
This
Subscription Agreement supersedes all other prior oral or written agreements
between HYUNDAI, the Company, their affiliates and persons acting on their
behalf with respect t-o the matters discussed herein, and this Subscription
Agreement and the instruments referenced herein contain the entire understanding
of the parties with respect to the matters covered herein and therein and,
except as specifically set forth herein or therein, neither the Company nor
HYUNDAI makes any representation, warranty, covenant or undertaking with respect
to such matters. No provision of this Subscription Agreement may be amended
or
waived other than by an instrument in writing signed by the Company and
HYUNDAI.
4.3
Severability.
If any
provision of this Subscription Agreement shall be invalid or unenforceable
in
any jurisdiction, such invalidity or unenforceability shall not affect the
validity or enforceability of the remainder of this Subscription Agreement
in
that jurisdiction or the validity or enforceability of any provision of this
Subscription Agreement in any other jurisdiction.
4.4
Governing Law; Jurisdiction; Jury Trial.
All
questions concerning the construction, validity, enforcement and interpretation
of this Subscription Agreement shall be governed by the internal laws of the
State of Nevada, without giving effect to any choice of law or conflict of
law
provision or rule (whether of the State of Nevada or any other jurisdictions)
that would cause the application of the laws of any jurisdictions other than
the
State of Nevada. Each party hereby irrevocably submits to the exclusive
jurisdiction of the federal courts sitting in the State of Nevada, for the
adjudication of any dispute hereunder or in connection herewith or with any
transaction contemplated hereby or discussed herein, and hereby irrevocably
waives, and agrees not to assert in any suit, action or proceeding, any claim
that it is not personally subject to the jurisdiction of any such court, that
such suit, action or proceeding is brought in an inconvenient forum or that
the
venue of such suit, action or proceeding is improper. Each party hereby
irrevocably waives personal service of process and consents to process being
served in any such suit, action or proceeding by sending a copy thereof to
such
party by overnight courier service at the address for such notices to it under
this Agreement and agrees that such service shall constitute good and sufficient
service of process and notice thereof. Nothing contained herein shall be deemed
to limit in any way any right to serve process in any manner permitted by law.
Each party hereby irrevocably waives any right it may have, and agrees not
to
request, a jury trial for the adjudication of any dispute hereunder or in
connection with or arising out of this Subscription Agreement or any transaction
contemplated hereby.
4.5
Headings.
The
headings of this Subscription Agreement are for convenience of reference and
shall not form part of, or affect the interpretation of, this Subscription
Agreement.
4.6
Successors And Assigns.
This
Subscription Agreement shall be binding upon and inure to the benefit of the
parties and their respective successors and assigns, including any purchasers
of
the Common Stock. The Company shall not assign this Subscription Agreement
or
any rights or obligations hereunder without the prior written consent of the
holders of at least a majority the Securities then outstanding, except by merger
or consolidation. HYUNDAI may assign some or all of its rights hereunder without
the consent of the Company, provided, however, that any such assignment shall
not release HYUNDAI from its obligations hereunder unless such obligations
are
assumed by such assignee and the Company has consented to such assignment and
assumption, which consent shall not be unreasonably withheld.
4.7
Survival.
The
representations and warranties of the Company and HYUNDAI contained in Articles
I and II shall survive the Closing for a period of one year.
4.8
Further
Assurances.
Each
party shall do and perform, or cause to be done and performed, all such further
acts and things, and shall execute and deliver all such other agreements,
certificates, instruments and documents, as the other party may reasonably
request in order to carry out the intent and accomplish the purposes of this
Subscription Agreement and the consummation of the transactions contemplated
hereby.
4.9
No
Strict Construction.
The
language used in this Subscription Agreement will be deemed to be the language
chosen by the parties to express their mutual intent, and no rules of strict
construction will be applied against any party, notwithstanding anything herein
to the contrary.
4.10
Legal Representation.
Each
party acknowledges that:
(a) it
has read this Subscription Agreement and the exhibits hereto; (b) it understands
that such party has been represented in the preparation, negotiation, and
execution of this Subscription Agreement by its own counsel; and that such
counsel has not represented and is not representing the other party; (c) it
has
been represented in the preparation, negotiation, and execution of this
Subscription Agreement by legal counsel of its own choice; and (d) it
understands the terms and consequences of this Subscription Agreement and is
fully aware of its legal and binding effect.
4.11
Confidentiality.
Each
party agrees that it shall keep confidential and not divulge, furnish or make
accessible to anyone, the confidential information concerning or relating to
the
business or financial affairs of the other party, if any, contained in the
Offering Documents to which it becomes privy until such information has been
publicly disclosed by such other party, until such information is no longer
confidential, or unless it is required to be disclosed under applicable law
or
regulation.
4.12
Counterparts.
This
Subscription Agreement may be executed in two or more identical counterparts,
all of which shall be considered one and the same agreement and shall become
effective when counterparts have been signed by each party and delivered to
the
other party; provided that a facsimile signature shall be considered due
execution and shall be binding upon the signatory thereto with the same force
and effect as if the signature were an original, not a facsimile
signature.
4.13
Legal
Fees.
In the
event that any dispute among the parties to this Agreement should result in
litigation, the prevailing party in such dispute shall be entitled to recover
from the losing party all fees, costs and expenses of enforcing any right of
such prevailing party under or with respect to this Agreement, including without
limitation such reasonable fees and expenses of attorneys and accountants,
which
shall include, without, limitation, all fees, costs and expense of
appeals.
IN
WITNESS WHEREOF, the parties have executed this Subscription Agreement as of
the
day and year first written above.
|
HYUNDAI:
Hyundai
Syscomm Corp.
By:
__________________________
Name:
Title:
|
|
|
__________________________
Taxpayer
Identification Number of Purchaser
|
|
|
Number
of Shares of Common Stock Subscribed For (subject to limitations
set
forth
in
this Subscription Agreement):
900,000
|
Subscription
Accepted by MSGI Security Solutions, Inc.:
By:
___________________________
Name: Xxxxxx Xxxxxxx
Title: Chairman and CEO
|
|
Number
of shares of Common Stock Sub-scription Accepted (subject to limitations
set forth in the Subscription Agreement):
900,000
|
