SUBSCRIPTION AGREEMENT
EXHIBIT
4.1
This SUBSCRIPTION AGREEMENT (this “Agreement”) is made the 31st day of March, 2008 by
and between AirNet Systems, Inc., an Ohio corporation (the “Company”), and AirNet Holdings,
Inc., a Delaware corporation (“Purchaser”).
WHEREAS, Purchaser desires to purchase common shares, par value $0.01 per share, of the
Company (the “Common Shares”), and the Company desires to issue and sell Common Shares to
Purchaser subject to the terms and conditions of this Agreement;
WHEREAS, concurrently with the execution and delivery of this Agreement, the Company,
Purchaser and AirNet Acquisition, Inc. are entering into an Agreement and Plan of Merger (the
“Merger Agreement”) pursuant to which, among other things, AirNet Acquisition, Inc. will be
merged with and into the Company, with the Company being the surviving corporation, all upon the
terms and subject to the conditions set forth in the Merger Agreement; and
WHEREAS, concurrently with the execution and delivery of this Agreement, Purchaser and the
Company are entering into a Registration Rights Agreement pursuant to which the Company will grant
to Purchaser certain registration rights in respect of the Common Shares acquired by Purchaser
hereunder.
NOW, THEREFORE, in consideration of the mutual promises, representations, warranties and
covenants set forth herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree, intending to be
legally bound, as follows:
ARTICLE I
PURCHASE AND SALE OF SHARES
Section 1. Sale and Issuance of Shares. Subject to the terms and conditions of this
Agreement, Purchaser hereby subscribes for and agrees to purchase, and the Company does hereby
agree to sell to Purchaser, at the Closing (as defined below), 1,934,137 Common Shares at the price
of $2.81 per Common Share.
Section 2. Delivery of Purchase Price. In consideration of and in exchange for the
Common Shares to be purchased hereunder, Purchaser shall deliver to the Company, prior to or at the
Closing, the aggregate consideration of $5,434,924.97 (the “Purchase Price”), payable in
cash or by wire transfer of immediately available funds.
Section 3. Closing. The closing of the purchase and sale of the Common Shares (the
“Closing”) shall occur at the offices of the Company at 10:00 a.m. on the date hereof or at
another time and location as mutually agreed by the Company and Purchaser. In consideration of the
purchase by Purchaser of the Common Shares and the payment of the Purchase Price therefor, the
Company shall deliver to Purchaser at the Closing the number of Common Shares purchased by
Purchaser as set forth above.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents and warrants to Purchaser that:
Section 1. Organization and Good Standing. The Company is a corporation duly
organized, validly existing and in good standing under the laws of the State of Ohio and has all
requisite corporate power and authority to carry on its business as now conducted and as proposed
to be conducted.
Section 2. Authorization. All corporate action on the part of the Company necessary
for the authorization, execution and delivery of this Agreement and the performance of all
obligations of the Company under this Agreement required to be performed at or prior to the Closing
and the performance of all obligations of the Company necessary for the authorization, issuance and
delivery of the Common Shares has occurred. This Agreement, when executed and delivered by the
parties hereto, shall constitute the valid and legally binding obligation of the Company and shall
be enforceable against the Company in accordance with its terms, except to the extent
enforceability may be limited by bankruptcy laws, insolvency laws, reorganization laws, moratorium
laws or other laws affecting creditors’ rights generally and except to the extent enforceability
may be limited by general equitable principles, whether such principles are considered in a
proceeding at law or in equity.
Section 3. Capital Structure. The Company is authorized to issue 40,000,000 Common
Shares and 10,000,000 shares of preferred stock, par value $0.01 per share (the “Preferred
Shares”). As of the date hereof, there were 10,179,671 Common Shares issued and outstanding
and no Preferred Shares issued and outstanding.
Section 4. Validity of Common Shares. The Common Shares, when issued, sold and
delivered in accordance with the terms of this Agreement shall be duly authorized and validly
issued, and shall be fully paid and nonassessable free and clear of all liens and encumbrances.
Section 5. Securities Act. The sale of Common Shares in accordance with the terms of
this Agreement (assuming the accuracy of the representations and warranties of Purchaser contained
in Article III hereof) is exempt from the registration requirements of the Securities Act
of 1933, as amended (the “1933 Act”). No form of general solicitation or general
advertising was used by the Company or its representatives in connection with the offer or sale of
the Common Shares.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF PURCHASER
Purchaser represents and warrants to the Company that:
Section 1. Authorization. All corporate action on the part of Purchaser necessary for
the authorization, execution and delivery of this Agreement and the performance of all obligations
of Purchaser under this Agreement required to be performed at or prior to the Closing
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has occurred. This Agreement, when executed and delivered by the parties hereto, shall
constitute the valid and legally binding obligation of Purchaser and shall be enforceable against
Purchaser in accordance with its terms, except to the extent enforceability may be limited by
bankruptcy laws, insolvency laws, reorganization laws, moratorium laws or other laws affecting
creditors’ rights generally and except to the extent enforceability may be limited by general
equitable principles, whether such principles are considered in a proceeding at law or in equity.
Section 2. Investment Representations.
(a) This Agreement is made in reliance upon Purchaser’s representations to the Company, which
by acceptance hereof Purchaser hereby confirms, that: (i) the Common Shares will be acquired by
Purchaser for investment only, for its own account and not as a nominee or agent and not with a
view to the sale or distribution of any part thereof in violation of applicable Federal and state
securities laws; and (ii) Purchaser has no current intention of selling, granting participation in
or otherwise distributing the Common Shares in violation of applicable Federal and state securities
laws. By executing this Agreement, Purchaser further represents that Purchaser does not have any
contract, undertaking, agreement or arrangement with any person to sell, transfer or grant
participation to such person, or to any third person, with respect to any of the Common Shares in
violation of applicable Federal and state securities laws.
(b) Purchaser understands that the Common Shares have not been registered under the 1933 Act
on the basis that the sale provided for in this Agreement and the issuance of securities hereunder
is exempt from registration under the 1933 Act and that the Company’s reliance on such exemption is
predicated on the representations and warranties of Purchaser set forth herein.
(c) Purchaser represents that it is an accredited investor (as such term is defined in
Rule 501 of the 1933 Act).
Section 3. Legends. Purchaser acknowledges that the certificates, if any, evidencing
the Common Shares may bear legends as required by Federal and state securities laws.
ARTICLE IV
MISCELLANEOUS
Section 1. No Waiver; Modifications in Writing. No failure or delay on the part of
the Company or Purchaser in exercising any right, power or remedy hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise of any such right, power or remedy
preclude any other or further exercise thereof or the exercise of any other right, power or remedy.
No waiver of or consent to any departure by either party from any provision of this Agreement
shall be effective unless signed in writing by the party entitled to the benefit thereof, provided
that notice of any such waiver shall be given to each party hereto as set forth below. This
Agreement sets forth the entire understanding of the parties and supersedes all prior agreements,
arrangements and communications, whether oral or written, with respect to the subject matter
hereof. Except as otherwise provided herein, no amendment, modification or termination of any
provision of this Agreement shall be effective unless signed in writing by or on behalf of the
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Company and Purchaser. Any amendment, supplement or modification of or to any provision of
this Agreement, any waiver of any provision of this Agreement, and any consent to any departure by
either party from the terms of any provision of this Agreement, shall be effective only in the
specific instance and for the specific purpose for which made or given.
Section 2. Notices. All notices and other communications necessary or contemplated
under this Agreement shall be in writing and shall be delivered in the manner specified in Section
8.3 of the Merger Agreement.
Section 3. Purchaser Intentions. The Company acknowledges and agrees that it
believes, in good faith, that: (i) the Purchaser’s stated sole purpose in proposing to enter into
the Merger Agreement was to succeed in acquiring control of the Company and that, under the
circumstances, including, without limitation, the Purchaser’s proposed price, financing and other
acquisition plans, the Purchaser’s financial resources and capabilities, and all other alternatives
reasonably anticipated to become available to the Company’s shareholders, there are reasonable
grounds to believe that the Purchaser will acquire control of the Company; and (ii) the public
disclosure made and contemplated to be made by or on behalf of the Purchaser in connection with the
transactions contemplated by the Merger Agreement concerning the Purchaser’s intentions or the
possibility of making a proposal to acquire control of the Company and all other conduct and
practices by or on behalf of the Purchaser in connection with any aspect of the proposed
transactions contemplated by the Merger Agreement were not effected with a purpose of affecting
market trading and thereby increasing any profit or decreasing any loss which the Purchaser might
realize, directly or indirectly, from the disposition of the Company’s Common Shares.
Section 4. Counterparts. This Agreement may be signed in any number of counterparts,
each of which shall be deemed to be an original instrument, and all such counterparts shall
together constitute the same agreement.
Section 5. Binding Effect; Assignment. The rights and obligations of the parties
under this Agreement may not be assigned to any other person without the prior written consent of
the other party. Except as expressly provided in this Agreement, this Agreement shall not be
construed so as to confer any right or benefit upon any person other than the parties to this
Agreement and their respective successors and assigns. This Agreement shall be binding upon the
Company and Purchaser and their respective successors and assigns.
Section 6. Governing Law. This Agreement shall be construed in accordance with and
governed by the law of the State of Ohio without giving effect to the principles of conflicts of
laws thereof.
Section 7. Further Assurances. From and after the date of this Agreement, upon the
request of Purchaser or the Company, the Company and Purchaser shall execute and deliver such
documents, instruments and other writings as may be reasonably necessary or desirable to confirm
and carry out and to effectuate fully the intent and purpose of this Agreement.
[Signature page follows]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their
respective authorized officers as of the day and year first above written.
| COMPANY: | PURCHASER: | |||||||||
| AIRNET SYSTEMS, INC. | AIRNET HOLDINGS, INC. | |||||||||
By: Name: |
/s/ Xxxxx X. Xxxxxx
|
By: Name: |
/s/ Xxxx Xxxxx
|
|||||||
Title:
|
Chairman of the Board, Chief Executive Officer and President | Title: | Vice President and Treasurer | |||||||
[Signature Page to Subscription Agreement]
