Exhibit 4.5
SUMMUS, INC. (USA)
SUBSCRIPTION AGREEMENT
THIS SUBSCRIPTION AGREEMENT (the "Agreement") by and between Summus, Inc. (USA),
a corporation organized and existing under the laws of the State of Florida (the
"Company"), and the undersigned subscriber, ____________________., for shares of
preferred stock, no par value per share, of the Company (the "Preferred Stock").
W I T N E S S E T H
WHEREAS, the Company has offered the Subscriber an opportunity to
purchase shares of the Company's Series E Convertible Preferred Stock (the
"Shares"), whose terms and conditions are as described in the Articles of
Amendment of Summus, Inc. (USA) for Series E Convertible Preferred Stock
attached hereto as Exhibit "A" (the "Certificate of Designation"), and warrants
(the "Warrants") to purchase shares of the Company's common stock, par value
$.001 per share (the "Common Stock") pursuant to a private offering (the
"Offering");
WHEREAS, contemporaneous with the execution and delivery of this
Agreement, the parties hereto are executing and delivering a Registration Rights
Agreement, in the form attached hereto as Exhibit "B" (the "Registration Rights
Agreement"), pursuant to which the Company has agreed to provide certain
registration rights under the 1933 Act and the rules and regulations promulgated
thereunder, and applicable state securities laws
WHEREAS, the Subscriber desires to purchase the Shares and Warrants
being offered on the terms and conditions set forth herein.
NOW, THEREFORE, for and in consideration of the premises and the mutual
covenants hereinafter set forth, the parties hereby agree as follows:
1. The Subscriber hereby subscribes and agrees to purchase, subject to
the terms and conditions of this Agreement, the number of Shares set forth
immediately before the signature page hereof at a purchase price of $1,000 per
Share. In connection with the purchase of the Shares, the Subscriber will
receive 2,500 Warrants per Share in the form attached hereto as Exhibit "C".
This Agreement represents an irrevocable offer by the Subscriber to subscribe
for such number of Shares and Warrants, except as expressly provided herein.
This Agreement, subject to the terms hereof, shall become a contract for the
sale of said Shares and Warrants upon the acceptance thereof by the Company.
2. The Company reserves the unrestricted right to accept or reject this
subscription, in whole or in part, and to withdraw this offer at any time prior
to acceptance by the Company. The subscription will not become effective unless
and until accepted by the Company.
The obligation of each Buyer hereunder to purchase the Shares
and Warrants at the Closing is subject to the satisfaction, at or before the
Closing Date, of each of the following conditions, provided that these
conditions are for such Subscriber's sole benefit and may be waived by such
Buyer at any time in its sole discretion:
A. The Company shall have executed this Agreement and the
Registration Rights Agreement, and delivered the same to the Subscriber.
B. The Company shall have delivered to the Subscriber duly
executed certificates (in such denominations as the Subscriber shall request)
representing the Shares and Warrants in accordance with Section 1 above.
C. The Certificate of Designation shall have been accepted for
filing with the Secretary of State of the State of Florida, and a copy thereof
certified by such Secretary of State shall have been delivered to such
Subscriber.
D. The representations and warranties of the Company shall be
true and correct in all material respects as of the date when made and as of the
Closing Date as though made at such time (except for representations and
warranties that speak as of a specific date, which representations and
warranties shall be true and correct as of such date) and the Company shall have
performed, satisfied and complied in all material respects with the covenants,
agreements and conditions required by this Agreement to be performed, satisfied
or complied with by the Company at or prior to the Closing Date. .
E. No litigation, statute, rule, regulation, executive order,
decree, ruling or injunction shall have been enacted, entered, promulgated or
endorsed by or in any court or governmental authority of competent jurisdiction
or any self-regulatory organization having authority over the matters
contemplated hereby which prohibits the consummation of any of the transactions
contemplated by this Agreement.
F. The Conversion Shares and the Warrant Shares shall
have been authorized for quotation on the Bulletin Board (as defined below) and
trading in the Common Stock on the Bulletin Board shall not have been suspended
by the SEC or the Bulletin Board.
3. This subscription is accompanied by the undersigned's certified or
official bank check or wire transfer of immediately available funds in the
dollar amount set forth on page 13 hereof (the "Purchase Price").
4. If this subscription is not accepted by the Company, the Company
shall promptly return the undersigned's payment within two (2) business days of
receipt by the Company of this agreement and the Purchase Price.
5. The Subscriber hereby makes the representations and warranties set
forth below with the express intention that they be relied upon by the Company
in determining the suitability of the Subscriber to purchase Shares. The
Subscriber hereby agrees to advise the Company if any of Subscriber's
representations in this Section 5 materially change prior to completion of this
subscription.
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(a) The Subscriber acknowledges that the Shares have not been
registered under the Securities Act of 1933, as amended (the "Securities Act"),
or under any applicable state securities laws on the grounds that the issuance
of the shares to Subscriber is exempt from registration. The Subscriber further
acknowledges that reliance on such exemption is, in part, based upon the
representations, warranties and covenants of Subscriber contained herein.
(b) The Subscriber is acquiring the Shares and Warrants, as well as the
shares of Common Stock issuable upon conversion of the Shares (the "Conversion
Shares") and the shares of Common Stock issuable upon exercise of the Warrants
(the "Warrant Shares" and, collectively with the Shares, Warrants and Warrant
Shares, the "Securities") for the Subscriber's own account as principal for the
Subscriber's investment and not with a present view to or for resale in
connection with any distribution thereof except pursuant to sales registered or
exempted from registration under the Securties Act; PROVIDED, HOWEVER, that by
making the representations herein, the Subscriber does not agree to hold any of
the Securities for any minimum or other specific term and reserves the right to
dispose of the Securities at any time in accordance with or pursuant to a
registration statement or an exemption under the 1933 Act.
(c) The Subscriber is an exempted company ORGANIZED UNDER THE LAWS OF
THE CAYMAN ISLANDS and will be the owner of the Shares standing in its name.
(d) The Subscriber has been furnished and has carefully reviewed
information about the Company to allow him to make an informed investment
decision prior to purchasing the Shares and has been given the opportunity to
ask questions of, and receive answers from, the Company concerning the business
plans of the Company, its present financial condition and the terms and
conditions of the Offering and to obtain such additional information that the
Company possesses or can acquire without unreasonable effort or expense
necessary to verify the accuracy of the information contained therein or
information that has been otherwise provided by the Company.
(e) The Subscriber acknowledges and is aware that (i) the Shares have
not been approved or disapproved by the Securities and Exchange Commission or by
any state securities commission, (ii) the Shares are a speculative investment
which involve material risk of loss of the Subscriber's entire investment, and
(iii) there are substantial restrictions on the transferability of the Shares.
(f) Subject to Section 5(b), the Subscriber fully understands and
agrees that the Subscriber must bear the economic risk of investment in the
Shares and Warrants for an indefinite period of time because, among other
reasons, subject to the Registration Rights Agreement, the Securities have not
been registered under the Securities Act or under any applicable state
securities laws and, therefore, cannot be sold or transferred unless they are
subsequently registered under applicable securities laws or an exemption from
such registration is available. The Subscriber further understands and agrees
that the Company will not honor any attempt by the Subscriber to sell or
transfer the Securities in the absence of (i) an effective registration
statement for such Securities, (ii) an opinion of counsel reasonably
satisfactory to the Company that an exemption from any applicable registration
requirements is available, (c) the Securities are sold or transferred to an
"affiliate" (as defined in Rule 144 promulgated under the Securities Act (or a
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successor rule) ("RULE 144")) of the Subscriber who agrees to sell or otherwise
transfer the Securities only in accordance with this Section 5(f) and who is an
Accredited Investor or (d) the Securities are sold pursuant to Rule 144. The
Subscriber further understands that, other than the Registration Rights
Agreement, the Company is under no obligation to register the Shares or make an
exemption from registration available. Notwithstanding the foregoing or anything
else contained herein to the contrary, the Securities may be pledged as
collateral in connection with a BONA FIDE margin account or other lending
arrangement.
(g) The Subscriber understands that the certificate(s) representing the
Shares and the Warrants and, until such time as the Conversion Shares and
Warrant Shares have been registered under the Securities Act as contemplated by
the Registration Rights Agreement or otherwise may be sold pursuant to Rule 144
without any restriction as to the number of securities as of a particular date
that can then be immediately sold, the Conversion Shares and Warrant Shares, may
bear a restrictive legend in substantially the following form (and a
stop-transfer order may be placed against transfer of the certificates for such
Securities):
THE SHARES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER THE
SECURITIES LAWS OF ANY STATE AND HAVE BEEN ISSUED IN RELIANCE UPON AN
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OF
1933, AS AMENDED, AND SUCH OTHER SECURITIES LAWS. THE SHARES MAY NOT BE
SOLD OR TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND SUCH
REGISTRATION OR QUALIFICATION AS MAY BE NECESSARY UNDER THE SECURITIES
LAWS OF ANY STATE, OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO
THE CORPORATION THAT SUCH REGISTRATION OR QUALIFICATION IS NOT
REQUIRED.
Subject to the reasonable requirements and procedures of the Company's transfer
agent , the legend set forth above shall be removed and the Company shall issue
a certificate without such legend to the holder of any Security upon which it is
stamped, if, unless otherwise required by applicable state securities laws, (a)
such Security is registered for sale under an effective registration statement
filed under the 1933 Act or otherwise may be sold pursuant to Rule 144 without
any restriction as to the number of securities as of a particular date that can
then be immediately sold, or (b) such holder provides the Company with an
opinion of counsel, in form, substance and scope customary for opinions of
counsel in comparable transactions, to the effect that a public sale or transfer
of such Security may be made without registration under the 1933 Act and such
sale or transfer is effected or (c) such holder provides the Company with
reasonable assurances that such Security can be sold pursuant to Rule 144. The
Buyer agrees to sell all Securities, including those represented by a
certificate(s) from which the legend has been removed, in compliance with
applicable prospectus delivery requirements, if any.
(h) The Subscriber has sought such accounting, legal and tax advice as
the Subscriber has considered necessary to make an informed investment decision.
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(i) The Subscriber is aware that no federal or state agency has made
any finding or determination as to the fairness of an investment in the Shares,
nor any recommendation or endorsement of any such investment.
(j) The Subscriber recognizes that it is important under the Securities
Act and state securities laws that the Company determine if the Subscriber is an
"Accredited Investor," as defined in APPENDIX A attached hereto. Subscriber
represents that Subscriber is an Accredited Investor and has checked all
categories of Accredited Investor on APPENDIX A that apply.
The representations, warranties, covenants and agreements contained in
this Section 5 shall survive the delivery of, and the payment for, the Shares.
6. The Company hereby makes the representations and agreements set forth
below in this Section 6 in connection with the subscription of the Securities in
this Offering:
(a) All amounts closed on by the Company from the sale of the shares of
the Series E Convertible Preferred Stock (and related warrants) and the
Securities (the "Private Placement" and such amounts being the "Private
Placement Proceeds") shall be used for general working capital purposes.
(b) The Company is a corporation duly organized, validly existing and
in good standing under the laws of the state of Florida and has all necessary
power and authority: (i) to conduct its business in the manner in which its
business is currently being conducted; (ii) to own and use its assets in the
manner in which its assets are currently owned and used; and (iii) to perform
its obligations under all material contracts by which it is bound. The Company
is qualified to do business as a foreign corporation, and is in good standing,
under the laws of all jurisdictions where the nature of its business requires
such qualification.
(c) (i) The Company has all requisite corporate power and authority to
file and perform its obligations under the Certificate of Designation and to
enter into and perform this Agreement, the Registration Rights Agreement and the
Warrants and to consummate the transactions contemplated hereby and thereby and
to issue the Securities, in accordance with the terms hereof and thereof, (ii)
the execution and delivery of this Agreement, the Registration Rights Agreement
and the Warrants by the Company, the filing of the Certificate of Designation
and the consummation by it of the transactions contemplated hereby and thereby
(including without limitation, the issuance of the Shares and the Warrants and
the issuance and reservation for issuance of the Conversion Shares issuable upon
conversion of or otherwise pursuant to the Preferred Shares and the Warrant
Shares issuable upon exercise of or otherwise pursuant to the Warrants ) have
been duly authorized by the Company's Board of Directors and no further consent
or authorization of the Company, its Board of Directors, or its stockholders is
required, (iii) this Agreement has been duly executed and delivered by the
Company, and (iv) this Agreement constitutes, and upon execution and delivery by
the Company of the Registration Rights Agreement and the Warrants and upon
execution and filing of the Certificate of Designation, each of such agreements
and instruments will constitute, a legal, valid and binding obligation of the
Company enforceable against the Company in accordance with its terms.
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(d) Neither (1) the execution, delivery or performance of this
Agreement, nor (2) the consummation of any of the transactions contemplated by
this Agreement, will directly or indirectly (with or without notice or lapse of
time): (a) contravene, conflict with or result in a violation of (i) any of the
provisions of the certificate of incorporation or bylaws of the Company, or (ii)
any resolution adopted by the shareholders, the board of directors or any
committee of the board of directors of the Company; (b) contravene, conflict
with or result in a violation or breach of, or result in a default under, any
provision of any material contract of the Company, or give any person the right
to (i) declare a default or exercise any remedy under any such material
contract, (ii) accelerate the maturity or performance of any such material
contract, or (iii) cancel, terminate or modify any term of such material
contract; or (c) result in a violation of any law, rule, regulation, order,
judgment or decree (including federal and state securities laws and regulations
and regulations of any self-regulatory organizations to which the Company or its
securities are subject) applicable to the Company or any of its subsidiaries or
by which any property or asset of the Company or any of its subsidiaries is
bound or affected. Neither the Company nor any of its subsidiaries is in
violation of its Certificate of Incorporation, By-laws or other organizational
documents and neither the Company nor any of its subsidiaries is in default (and
no event has occurred which with notice or lapse of time or both could put the
Company or any of its Subsidiaries in default) under, and neither the Company
nor any of its Subsidiaries has taken any action or failed to take any action
that would give to others any rights of termination, amendment, acceleration or
cancellation of, any agreement, indenture or instrument to which the Company or
any of its subsidiaries is a party or by which any property or assets of the
Company or any of its Subsidiaries is bound or affected. The businesses of the
Company and its Subsidiaries, if any, are not being conducted, and shall not be
conducted so long as a Buyer owns any of the Securities, in violation of any
law, ordinance or regulation of any governmental entity.
(e) Except as specifically contemplated by this Agreement and as
required under the Securites Act and any applicable state securities laws, the
Company is not required to obtain any consent, authorization or order of, or
make any filing or registration with, any court, governmental agency, regulatory
agency, self regulatory organization or stock market or any third party in order
for it to execute, deliver or perform any of its obligations under this
Agreement, the Registration Rights Agreement or the Warrants in accordance with
the terms hereof or thereof or to issue and sell the Shares and Warrants in
accordance with the terms hereof and to issue the Conversion Shares upon
conversion of or otherwise pursuant to the Shares and the Warrant Shares upon
exercise of or otherwise pursuant to the Warrants. All consents, authorizations,
orders, filings and registrations which the Company is required to obtain
pursuant to the preceding sentence have been obtained or effected on or prior to
the date hereof.
(f) (a) The Company has delivered or made available to the Subscriber
accurate and complete copies of the filings by the Company with the Securities
and Exchange Commission (the "SEC"). All statements, reports, schedules, forms,
certifications and other documents required to have been filed by the Company
with the SEC (the "SEC Documents") have been so filed on a timely basis. As of
the time it was filed with the SEC: (i) each of the Company SEC Documents
complied in all material respects with the applicable requirements of the
Securities Act or the Exchange Act (as the case may be); and (ii) none of the
Company SEC Documents contained any untrue statement of a material fact or
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omitted to state a material fact required to be stated therein or necessary in
order to make the statements therein, in the light of the circumstances under
which they were made, not misleading. None of the statements made in any such
SEC Documents is, or has been, required to be amended or updated under
applicable law (except for such statements as have been amended or updated in
subsequent filings prior to the date hereof). (b) The Company maintains
disclosure controls and procedures required by Rule 13a-15 or Rule 15d-15 under
the Exchange Act. Such controls and procedures are effective to ensure that all
material information concerning the Company is made known on a timely basis to
the individuals responsible for preparing the Company's filings with the SEC and
other public disclosure documents. (c) Each director and executive officer of
the Company has filed with or otherwise furnished, supplied or delivered to the
SEC on a timely basis all statements required by Section 16(a) of the Exchange
Act and the rules and regulations thereunder. The Chief Executive Officer and
the Chief Financial Officer of the Company have signed, and the Company has
filed with or otherwise furnished, supplied or delivered to the SEC, all
certifications required by Section 906 of the Xxxxxxxx-Xxxxx Act of 2002, each
such certification is true and correct, and no such certification includes any
qualification or exception to any matter certified in such certification or has
been modified or withdrawn. Neither the Company nor any of its officers has
received any notice or other communication from any governmental body
questioning or challenging the accuracy, completeness, form or manner of filing
or submission of any such certification. The financial statements (including any
related notes) contained in the Company SEC Documents: (i) complied as to form
in all material respects with the published rules and regulations of the SEC
applicable thereto; (ii) were prepared in accordance with generally accepted
accounting principles applied on a consistent basis throughout the periods
covered, and (iii) fairly present the financial position of the Company as of
the respective dates thereof and the results of operations and cash flows of the
Company for the periods covered thereby.
(g) Since June 30, 2003, there has been no material adverse change and
no material adverse development in the assets, liabilities, business,
properties, operations, financial condition, results of operations or prospects
of the Company or any of its Subsidiaries.
(h) Except for arm's length transactions pursuant to which the Company
or any of its subsidiaries makes payments in the ordinary course of business
upon terms no less favorable than the Company or any of its subsidiaries could
obtain from third parties and other than the grant of stock options pursuant to
a stock option plan approved by the majority of the board of directors
independent directors, none of the officers, directors, or employees of the
Company is presently a party to any transaction with the Company or any of its
subsidiaries (other than for services as employees, officers and directors),
including any contract, agreement or other arrangement providing for the
furnishing of services to or by, providing for rental of real or personal
property to or from, or otherwise requiring payments to or from any officer,
director or such employee or, to the knowledge of the Company, any corporation,
partnership, trust or other entity in which any officer, director, or any such
employee has a substantial interest or is an officer, director, trustee or
partner.
(i) All information relating to or concerning the Company or any of its
subsidiaries set forth in this Agreement and provided to the Subscriber pursuant
to Section 5(d) hereof and otherwise in connection with the transactions
contemplated hereby is true and correct in all material respects and the Company
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has not omitted to state any material fact necessary in order to make the
statements made herein or therein, in light of the circumstances under which
they were made, not misleading. No event or circumstance has occurred or exists,
nor is the Company in possession of any information, with respect to the Company
or any of its subsidiaries or its or their business, properties, prospects,
operations or financial conditions, which has not been publicly announced or
disclosed but under applicable law, rule or regulation, requires public
disclosure or announcement by the Company (assuming for this purpose that the
Company's reports filed under the Securities and Exchange Act of 1934 (the
"Exchange Act") are being incorporated into an effective registration statement
filed by the Company under the Securities Act).
(j) The Company acknowledges and agrees that the Subscriber is acting
solely in the capacity of arm's length purchaser with respect to this Agreement
and the transactions contemplated hereby. The Company further acknowledges that
the Subscriber is not acting as a financial advisor or fiduciary of the Company
(or in any similar capacity) with respect to this Agreement and the transactions
contemplated hereby and that any statement made by any Subscriber or any of its
respective representatives or agents in connection with this Agreement and the
transactions contemplated hereby is not advice or a recommendation and is merely
incidental to the Subscriber's purchase of the Securities and has not been
relied upon by the Company, its officers or directors in any way. The Company
further represents to each Subscriber that the Company's decision to enter into
this Agreement has been based solely on the independent evaluation of the
Company and its representatives.
(k) Neither the Company, nor any of its affiliates, nor any person
acting on its or their behalf, has directly or indirectly made any offers or
sales of any security or solicited any offers to buy any security under
circumstances that would require registration under the Securities Act of the
issuance of the Securities to the Subscriber. The issuance of the Securities to
the Subscriber will not be integrated with any other issuance of the Company's
securities (past, current or future) for purposes of any stockholder approval
provisions applicable to the Company or its securities.
(l) The Company has taken no action which would give rise to any claim
by any person for brokerage commissions, finder's fees or similar payments
relating to this Agreement or the transactions contemplated hereby, except for
dealings with X. Xxxxxx Xxxxxx, whose commissions and fees will be paid for by
the Company.
7. The Company covenants and agrees to the following:
(a) The Company's Common Stock is registered under Section 12(g) of the
1934 Act. So long as any Buyer beneficially owns any of the Securities, the
Company shall timely file all reports required to be filed with the SEC pursuant
to the Exchange Act, and the Company shall not terminate its status as an issuer
required to file reports under the Exchange Act even if the Exchange Act or the
rules and regulations thereunder would permit such termination.
(b) The Company shall at all times have authorized, and reserved for
the purpose of issuance, a sufficient number of shares of Common Stock to
provide for the full conversion of the outstanding Shares and issuance of the
Conversion Shares in connection with the Shares and as otherwise required by the
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Certificate of Designation and the full exercise of the Warrants and issuance of
the Warrant Shares in connection therewith. The Company shall not reduce the
number of shares of Common Stock reserved for issuance upon conversion of or
otherwise pursuant to the Shares and upon exercise of or otherwise pursuant to
the Warrants without the consent of the Subscriber. If at any time the number of
shares of Common Stock authorized and reserved for issuance is below the number
of Conversion Shares issued and issuable upon conversion of or otherwise
pursuant to the Shares and the aggregate number of Warrant Shares issued and
issuable upon exercise of or otherwise pursuant to the Warrants, the Company
will promptly take all corporate action necessary to authorize and reserve a
sufficient number of shares, including, without limitation, calling a special
meeting of stockholders to authorize additional shares to meet the Company's
obligations under this Section 7(b), in the case of an insufficient number of
authorized shares, and using its best efforts to obtain stockholder approval of
an increase in such authorized number of shares.
(c) The Company shall promptly secure the listing of the Conversion
Shares and Warrant Shares upon each national securities exchange or automated
quotation system, if any, upon which shares of Common Stock are then listed
(subject to official notice of issuance) and, so long as the Subscriber owns any
of the Securities, shall maintain, so long as any other shares of Common Stock
shall be so listed, such listing of all Conversion Shares and Warrant Shares
from time to time issuable upon conversion of or otherwise pursuant to the
Shares or exercise of or otherwise pursuant to the Warrants. The Company will
obtain and, so long as any Buyer owns any of the Securities, maintain the
listing and trading of its Common Stock on the Over-the-Counter Bulletin Board
(the "Bulletin Board"), the Nasdaq National Market ("Nasdaq"), the Nasdaq
SmallCap Market ("Nasdaq SmallCap"), the New York Stock Exchange ("NYSE"), or
the American Stock Exchange ("AMEX"), as applicable and will comply in all
respects with the Company's reporting, filing and other obligations under the
bylaws or rules of the National Association of Securities Dealers ("NASD") and
such exchanges, as applicable. The Company shall promptly provide to each Buyer
copies of any notices it receives from the Bulletin Board and any other
exchanges or quotation systems on which the Common Stock is then listed
regarding the continued eligibility of the Common Stock for listing on such
exchanges and quotation systems.
8. This Agreement and subscription herein shall survive the death or
disability of any individual Subscriber and the dissolution or termination of
any subscribing entity, and this Agreement shall be binding upon the heirs,
executors, administrators, successors and assigns of any such Subscriber. All
pronouns and any variations thereof used herein shall be deemed neuter, singular
or plural as the identity of the Subscriber may require. The representations and
warranties and covenants and agreements of the Company set forth herein shall
survive the closing hereunder notwithstanding any due diligence investigation
conducted by or on behalf of the Subscriber. The Company agrees to indemnify and
hold harmless each of the Subscriber and all its officers, directors, employees
and agents for loss or damage arising as a result of or related to any breach or
alleged breach by the Company of any of its representations, warranties and
covenants set forth herein or any of its covenants and obligations under this
Agreement or the Registration Rights Agreement, including advancement of
expenses as they are incurred.
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9. This Agreement shall be enforced, governed and construed in all respects
in accordance with the laws of the State of Delaware, as such laws are applied
by Delaware courts to agreements entered into and to be performed in Delaware
without regard to conflicts of law. Both parties irrevocably consent to the
exclusive jurisdiction of the United States federal courts and the state courts
located in Delaware with respect to any suit or proceeding based on or arising
under this Agreement, the agreements entered into in connection herewith or the
transactions contemplated hereby or thereby and irrevocably agree that all
claims in respect of such suit or proceeding may be determined in such courts.
Both parties irrevocably waive the defense of an inconvenient forum to the
maintenance of such suit or proceeding. Both parties further agree that service
of process upon a party mailed by first class mail shall be deemed in every
respect effective service of process upon the party in any such suit or
proceeding. Nothing herein shall affect either party's right to serve process in
any other manner permitted by law. Both parties agree that a final
non-appealable judgment in any such suit or proceeding shall be conclusive and
may be enforced in other jurisdictions by suit on such judgment or in any other
lawful manner.
10. The number of Shares subscribed for by the Subscriber and their
registration of ownership are as set forth on page 13 of this Agreement:
11. This Agreement shall be binding upon and shall inure to the benefit of
the parties hereto and their respective successors, assigns, executors and
administrators, but this Agreement and the respective rights and obligations of
the parties hereunder shall not be assignable by any party hereto without the
prior written consent of the other. Notwithstanding the foregoing, subject to
Section 5(f), any Subscriber may assign its rights hereunder to any person that
purchases Securities in a private transaction from the Subscriber or to any of
its "affiliates," as that term is defined under the Exchange Act, without the
consent of the Company; provided, however, that the Company will receive notice
of such transfer.
12. This Agreement represents the entire understanding and agreement
between the parties hereto with respect to the subject matter hereof and cannot
be amended, supplemented or modified except by an instrument in writing signed
by the party against whom enforcement of any such amendment, supplement or
modification is sought.
13. If any provision of this 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 Agreement or the validity or
enforceability of this Agreement in any other jurisdiction.
14. The Company agrees that it will not disclose, and will not include in
any public filing or other announcement, the name of the Subscriber, unless
expressly agreed to in writing by such Subscriber or unless and until such
disclosure is, in the reasonable opinion of counsel to the Company, required by
law or applicable regulation, and then only to the extent of such requirement.
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15. The Company acknowledges that the obligations of the Subscriber under
the this Agreement and documents related hereto (the "Transaction Documents")
are several and not joint with the obligations of any other Subscriber in the
Private Placment, and no Subscriber shall be responsible in any way for the
performance of the obligations of any other Subscriber under the Transaction
Documents or the Transactions Documents entered into in the Private Placement.
The decision of the Subscriber to purchase Securities pursuant to this Agreement
has been made by such Subscriber independently of any other Subscriber in the
Private Placement and independently of any information, materials, statements or
opinions as to the business, affairs, operations, assets, properties,
liabilities, results of operations, condition (financial or otherwise) or
prospects of the Company or of the subsidiaries which may have made or given by
any other Subscriber or by any agent or employee of any other Subscriber, and no
Subscriber or any of its agents or employees shall have any liability to any
Subscriber (or any other person) relating to or arising from any such
information, materials, statements or opinions. The Company further acknowledges
that nothing contained herein, or in any Transaction Document or the Transaction
Documents for the Private Placement, and no action taken by any Subscriber
pursuant hereto or thereto, shall be deemed to constitute the Subscribers
hereunder and in the Private Placement as a partnership, an association, a joint
venture or any other kind of entity, or create a presumption that such
Subscribers are in any way acting in concert or as a group with respect to such
obligations or the transactions contemplated by the Transaction Documents or the
Transaction Documents in the Private Placement. Each Subscriber shall be
entitled to independently protect and enforce its rights, including without
limitation, the rights arising out of this Agreement, out of the other
Transaction Documents or the Transaction Documents in the Private Placement, and
it shall not be necessary for any other Subscriber to be joined as an additional
party in any proceeding for such purpose.
16. The parties acknowledge that a breach by them of their obligations
hereunder will cause irreparable harm to the other party by vitiating the intent
and purpose of the transactions contemplated hereby. Accordingly, each party
acknowledges that the remedy at law for a breach of its obligations under this
Agreement will be inadequate and agrees, in the event of a breach or threatened
breach by the other party of the provisions of this Agreement, that the other
party shall be entitled, in addition to all other available remedies in law or
in equity, to an injunction or injunctions to prevent or cure any breaches of
the provisions of this Agreement and to enforce specifically the terms and
provisions of this Agreement, without the necessity of showing economic loss and
without any bond or other security being required.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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PLEASE TYPE OR PRINT
Owner: _____________________
Social Security Number or
Federal Employer Identification Number: _______________________________________
Residence
Address: ____________________________________________________________________
Mailing Address
(if other than
Residence): __________________________________________________________________
Telephones: Res. _________________ Bus. _______________ Fax.______________
Email._______________________________________________________________________
Joint Owner (if any):
Social Security Number or
Federal Employer Identification Number: ______________________________________
Residence Address: ___________________________________________________________
Mailing Address
(if other than
Residence): _________________________________________________________________
Telephones: Res. ____________________________ Bus. __________________________
SHARES TO BE REGISTERED AS INDICATED BELOW:
[ ] Sole ownership
[ ] Joint tenants with right of survivorship
[ ] Tenants in common
Number of Shares subscribed for: 200
NUMBER OF WARRANTS: 500,000
Total Purchase Price ($1,000 PER SHARE): $200,000
PAYMENT IN FULL DELIVERED IN AMOUNT OF: $200,000
12
IN WITNESS WHEREOF, the undersigned has executed or caused to be executed under
seal this Agreement, as of OCTOBER __, 2003.
SIGNATURE FORM FOR INDIVIDUALS
(SEAL)
Signature________________________________
Name:____________________________________
______________________________(SEAL)
(Signature of Joint Owner, if any)
Name:____________________________________
SIGNATURE FORM FOR CORPORATIONS:
(Name of corporation)
By:_____________________________________
(Signature of Officer
_________________________________________
(Name and Title)
SIGNATURE FORM FOR PARTNERSHIPS OR LIMITED
LIABILITY COMPANIES:
_________________________________________
(Name of Partnership or LLC)
BY ITS GENERAL PARTNERS OR MANAGERS:
Name:____________________________________
Name:____________________________________
Name:____________________________________
SIGNATURE FORM FOR TRUSTS:
_________________________________________
(Full Name of Trust)
BY ITS TRUSTEE(S):
Name:____________________________________
Name:____________________________________
Name:____________________________________
13
ACCEPTANCE OF SUBSCRIPTION
The, foregoing Subscription Agreement is ACCEPTED by the Company, on October __,
2003, for ___ shares of its Series E Preferred Stock.
SUMMUS, INC. (USA)
BY:_______________________________
XXXXX XXXXXXX
CHIEF EXECUTIVE OFFICER
14
APPENDIX A
AN ACCREDITED INVESTOR IS DEFINED AS FOLLOWS. PLEASE CHECK ALL DEFINITIONS THAT
APPLY.
/ / a natural person whose individual net worth, or joint net worth with that
person's spouse, at the time of purchase exceeds U.S. $1,000,000;
/ / a natural person who had an individual income in excess of U.S. $200,000
in each of the two most recent years or joint income with that person's
spouse in excess of U.S. $300,000 in each of those years and has a
reasonable expectation of reaching the same income level in the current
year (i.e., the year in which the purchase is made);
/ / any trust, with total assets in excess of U.S. $5,000,000, not formed
for the specific purpose of acquiring shares of PreferredStock and/or
warrants, whose purchase is directed by a sophisticated person having
such knowledge and experience in financial and business matters that
she is capable of evaluating the merits and risks of investing in the
Company;
/ / a director or executive officer of the Company;
/ / an organization described in Section 501(c)(3) of the Internal Revenue
Code, corporation, Massachusetts or similar business trust, or
partnership, not formed for the specific purpose of acquiring the
shares of PreferredStock and/or warrants, with total assets in excess
of U.S. $5,000,000;
/ / a bank as defined in Section 3(a)(2) of the Securities Act of 1933 (the
"Securities Act"), or a savings and loan association or other
institution as defined in Section 3(a)(5)(A) of the Securities Act
whether acting in its individual or fiduciary capacity; a broker dealer
registered under the Securities Exchange Act of 1934; an insurance
company as defined in Section 2(13) of the Act; an investment company
registered under the Investment Company Act of 1940 or a business
development company as defined in Section 2(a)(48) of that Act; a Small
Business Investment Company licensed under the Small Business
Investment Act of 1958; an employee benefit plan within the meaning of
Title I of the Employee Retirement Income Security Act of 1974, if the
investment decision is made by a plan fiduciary, which is either a
bank, savings and loan association, an insurance company, or registered
investment adviser, or if the employee benefit plan has total assets in
excess of U.S. $5,000,000 or, if a self-directed plan, with investment
decisions made solely by persons that are accredited investors;
8
/ / a private business development company as defined in the Investment
Advisers Act of 1940; or
/ / an entity in which all of the equity owners are Accredited Investors.
15
