SUBSCRIPTION AGENT AGREEMENT
Exhibit
4.4
This Subscription Agent Agreement (the
“Agreement”) is made as of September ____, 2008, between Hotel Outsource
Management International, Inc., a Delaware corporation (the “Company”), and
Standard Registrar & Transfer Co. Inc., a Utah corporation (the “Agent” or
“Standard”). All terms not defined herein shall have the meaning abscribed to
such terms in the prospectus (the “Prospectus”) included in the Registration
Statement on Form S-1 (File No.
[ ])
filed by the Company with the Securities and Exchange Commission (the “SEC”) on
September _, 2008, as amended by any amendment filed with respect thereto (the
“Registration Statement”).
WHEREAS, the Company proposes to
distribute non-transferable rights to subscribe for shares of its common stock,
par value $0.001 per share (the “Common Stock”), to the stockholders
(“Stockholders”) of record as of 5:00 p.m., New York City time, on
[ ],
2008, or such later date as the registration statement regarding the rights
offering is declared effective by the SEC (the “Record Date”) by issuing rights
certificates or other evidences of the subscription rights, in the form
designated by the Company (the “Rights Certificates”), pursuant to which each
Stockholder will have the subscription rights (the “Subscription Rights”) to
subscribe for shares of Common Stock as described in and on such terms as are
set forth in the Prospectus, a final copy of which has been or, upon
availability, will promptly be delivered to the Agent; and
WHEREAS, the Company wishes the Agent
to perform certain acts on behalf of the Company, and the Agent is willing to so
act, in connection with the distribution of the Rights Certificates and the
issuance and exercise of the Subscription Rights to subscribe therein set forth,
all upon the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the
foregoing and of the mutual agreements set forth herein, the parties agree as
follows:
1. Appointment.
The Company hereby appoints the Agent to act as subscription agent in connection
with the distribution of the Rights Certificates and the issuance and exercise
of the Subscription Rights in accordance with the terms set forth in this
Agreement and the Agent hereby accepts such appointment.
2. Form and
Execution of Rights Certificates. Each Rights Certificate shall be
irrevocable and non-transferable. The Agent shall, in its capacity as transfer
agent of the Company, maintain a register of Rights Certificates and the holders
of record thereof (each of whom shall be deemed a “Stockholder” hereunder for
purposes of determining the rights of holders of Rights Certificates). Each
Rights Certificate shall, subject to the provisions thereof, entitle the
Stockholder in whose name it is recorded to the following:
A. With respect to Stockholders as of
5:00 p.m., New York City time, on the Record Date only (“Record Date
Stockholders”), the right to acquire during the Subscription Period (as defined
in the Prospectus), at the Subscription Price (as defined in the Prospectus),
the number of shares of Common Stock defined in the Prospectus for every one
Right (the “Basic Subscription Right”); and
B. With respect to Record Date
Stockholders only, the right to subscribe for additional shares of Common Stock,
subject to the limitations contained in the Prospectus and to the allotment of
such shares as may be available among Record Date Stockholders who exercise
Over-Subscription Priveleges on the basis specified in the Prospectus; provided,
however, that such Record Date Stockholder has exercised their Basic
Subscription Rights in full (the “Over-Subscription Privilege”).
3. Subscription
Rights and Issuance of Rights Certificates.
A. Each Rights Certificate shall
evidence the Subscription Rights of the Stockholder therein named to purchase
Common Stock upon the terms and conditions therein and herein set
forth.
B. Upon the written advice of the
Company, signed by any of its duly authorized officers, as to the Record Date,
the Agent shall, from a list of the Stockholders as of the Record Date to be
prepared by the Agent in its capacity as transfer agent of the Company, prepare
and record Rights Certificates in the names of the Stockholders, setting forth
the number of Suscription Rights to subscribe for the Company’s Common Stock
calculated on the basis of one Right for each whole share of Common Stock
recorded on the books in the name of each such Stockholder as of the Record
Date. The number of Subscription Rights that are issued to Record Date
Stockholders will be rounded down, by the Agent, to the nearest number of full
shares of Common Stock held by each Record Date Stockholder. Fractional
Subscription Rights will not be issued. Each Rights Certificate shall be dated
as of the Record Date and may be executed manually or by facsimile signature of
a duly authorized officer of the Agent. Upon the written advice, signed as
aforesaid, as to the effective date of the Registration Statement, the Agent
shall deliver the Rights Certificates, together with a copy of the Prospectus,
instruction letter and any other document as the Company deems necessary or
appropriate, to all Record Date Stockholders with record addresses in the United
States (including its territories and possessions and the District of Columbia)
by first class mail.
4. Exercise.
A. Record Date Stockholders may acquire
shares of Common Stock on the exercise of the Basic Subscription Rights and, if
the Basic Subscription Rights are exercised in full, pursuant to the
Over-Subscription Privilege by delivery to the Agent as specified in the
Prospectus of (i) the Rights Certificate with respect thereto, duly
executed by such Stockholder in accordance with and as provided by the terms and
conditions of the Rights Certificate, together with (ii) the estimated purchase
price, as disclosed in the Prospectus, for each share of Common Stock subscribed
for by exercise of such Subscription Rights, in U.S. dollars by money order or
check drawn on a bank in the United States, postal or express money order, in
each case payable to the order of Standard, or wire transfer of immediately
available funds to an account of Standard specified in the Rights Certificate or
instructions as to use of the Rights Certificates.
B. Subscription Rights may be exercised
at any time after the date of issuance of the Rights Certificates with respect
thereto but no later than 5:00 p.m., New York City time, on such date as the
Company shall designate to the Agent in writing (the “Expiration Date”). For the
purpose of determining the time of the exercise of any Subscription Rights,
delivery of any material to the Agent shall be deemed to occur when such
materials are received by the Agent specified in the Prospectus.
C. Notwithstanding the provisions of
Section 4(A) and 4(B) regarding delivery of an executed Rights Certificate
to the Agent prior to 5:00 p.m., New York City time, on the Expiration Date, if
prior to such time the Agent receives a Notice of Guaranteed Delivery by
facsimile (telecopy) or otherwise from a bank, a trust company or a New
York Stock Exchange member guaranteeing delivery and payment of the full
Subscription Price (as defined in the Prospectus) for the shares of Common Stock
subscribed pursuant to the Stockholder’s Basic Subscription Rights and any
additional shares of Common Stock subscribed for pursuant to the
Over-Subscription Privilege, then such exercise of Basic Subscription Rights and
Over-Subscription Privilege shall be regarded as timely, subject, however, to
receipt of the duly executed Rights Certificate within three Business Days (as
defined below) after the Expiration Date (the “Protect Period”). For the
purposes of the Prospectus and this Agreement, “Business Day” shall mean any day
on which trading is conducted on the New York Stock Exchange.
D. As soon as practicable after the
Expiration Date, Standard shall send to each exercising Stockholder (or, if
shares of Common Stock on the Record Date are held by broker, custodian bank, or
other nominee, to such broker, custodian bank, or other nominee) a confirmation
showing the number of shares of Common Stock acquired pursuant to the Basic
Subscription Rights, and, if applicable, the Over-Subscription Privilege, the
per share and total purchase price for such shares, and any excess to be
refunded by the Company to such Stockholder in the form of a check and stub,
along with a letter explaining the allocation of shares of Common Stock pursuant
to the Over-Subscription Privilege.
E. If a Stockholder does not make
timely payment of any additional amounts due in accordance with Section 4(C),
Standard will consult with the Company in accordance with Section 5 as to the
appropriate action to be taken. Standard will not issue or deliver certificates
or Statements of Holding for shares subscribed for until payment in full
therefore has been received, including collection of checks and payment pursuant
to notices of guaranteed delivery.
5. Validity
of Subscriptions.
Irregular subscriptions not otherwise covered by specific instructions
herein shall be submitted to an appropriate officer of the Company and handled
in accordance with his or her instructions. Such instructions will be documented
by the Agent indicating the instructing officer and the date
thereof.
6. Over-Subscription. If, after allocation of
shares of Common Stock to Record Date Stockholders, there remain unexercised
Subscription Rights, then the Agent shall allot the shares issuable upon
exercise of such unexercised Rights (the “Remaining Shares”) to Stockholders who
have exercised their Basic Subscription Rights in full and who elected to
exercise their Over-Subscription Privilege. Shares subscribed for pursuant to
the Over-Subscription Privilege will be allocated according to the formula and
subject to the limitations set forth in the Prospectus. If the number of shares
for which the Over-Subscription Privilege has been exercised is greater than the
Remaining Shares, the Agent shall allocate the Remaining Shares to Record Date
Stockholders exercising Over-Subscription Privileges as described in the
Prospectus. The percentage of Remaining Shares each over-subscribing Record Date
Stockholder acquires will be rounded down to result in delivery of whole shares
of Common Stock. The Agent shall advise the Company immediately upon the
completion of the allocation set forth above as to the total number of shares
subscribed and distributable. Any Remaining Shares offered but not subscribed
for by the Record Date Stockholders pursuant to the exercise of either Basic
Subscription Rights and Over-Subscription Privileges and any shares of Common
Stock issued pursuant to the minimum guarantee amount in the standby purchase
agreements shall be allocated to the standby purchasers on the terms and
conditions set forth in the Prospectus and the standby purchase
agreements.
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7. Delivery
of Shares. The
Agent will deliver certificates or Statement of Holding reflecting new shares of
Common Stock, representing those shares of Common Stock purchased pursuant to
exercise of Basic Subscription Rights and, as applicable, Over-Subscription
Privileges as soon as practicable after the Expiration Date.
8. Holding
Proceeds of Rights Offering.
A. All proceeds received by Standard
from Stockholders in respect of the exercise of Subscription Rights shall be
held by Standard, on behalf of the Company, in a segregated account (the
“Account”). No interest shall accrue to the Company or Stockholders on funds
held in the Account pending disbursement in the manner described in Section 4
above.
B. Standard shall deliver all proceeds
received in respect of the exercise of Subscription Rights to the Company as
promptly as practicable, but in no event later than three business days after
the Expiration Date of the Rights Offering.
C. The Company acknowledges that the
bank accounts maintained by Standard in connection with the services provided
under this Agreement will be in its name and that Standard may receive
investment earnings in connection with the investment at Standard's risk and for
its benefit of funds held in those accounts from time to time.
9. Reports. Daily, during the period
commencing on the date hereof, until termination of the Subscription Period, the
Agent will report by telephone or telecopier, confirmed by letter, to an officer
of the Company, data regarding Subscription Rights exercised, the total number
of shares of Common Stock subscribed for, and payments received therefor,
bringing forward the figures from the previous day’s report in each case so as
to show the cumulative totals and any such other information as may be mutually
determined by the Company and the Agent.
10. Loss or
Mutilation. If
any Rights Certificate is lost, stolen, mutilated or destroyed, the Agent may,
on such terms which will indemnify and protect the Company and the Agent, issue
a new Rights Certificate of like denomination in substitution for the Rights
Certificate so lost, stolen, mutilated or destroyed.
11. Compensation
for Services. The
Company agrees to pay to the Agent, as compensation for Agent’s services
hereunder, in accordance with the Fee Schedule attached hereto as Exhibit A. The
Company further agrees that it will reimburse the Agent for its reasonable
out-of-pocket expenses incurred in the performance of its duties as
such.
12. Instructions,
Indemnification and Limitation of Liability. The Agent undertakes the
duties and obligations imposed by this Agreement upon the following terms and
conditions:
A. The Agent shall be entitled to rely
upon any instructions or directions furnished to it by an appropriate officer of
the Company, whether in conformity with the provisions of this Agreement or
constituting a modification hereof or a supplement hereto. Without limiting the
generality of the foregoing or any other provision of this Agreement, the Agent,
in connection with its duties hereunder, shall not be under any duty or
obligation to inquire into the validity or invalidity or authority or lack
thereof of any instruction or direction from an officer of the Company which
conforms to the applicable requirements of this Agreement and which the Agent
reasonably believes to be genuine and shall not be liable for any delays, errors
or loss of data occurring by reason of circumstances beyond the Agent’s
control.
B. The Company will indemnify the Agent
and its nominees against, and hold it harmless from, all liability and expense
which may arise out of or in connection with the services described in this
Agreement or the instructions or directions furnished to the Agent relating to
this Agreement by an appropriate officer of the Company, except for any
liability or expense which shall arise out of the gross negligence, bad faith or
willful misconduct of the Agent or such nominees.
C. Promptly after the receipt by the
Agent of notice of any demand or claim or the commencement of any action, suit,
proceeding or investigation, the Agent shall, if a claim in respect thereof is
to be made against the Company, notify the Company thereof in writing. The
Company shall be entitled to participate as its own expense in the defense of
any such claim or proceeding, and, if it so elects at any time after receipt of
such notice, it may assume the defense of any suit brought to enforce any such
claim or of any other legal action or proceeding. For the purposes of this
Section 12, the term “expense or loss” means any amount paid or payable to
satisfy any claim, demand, action, suit or proceeding settled with the express
written consent of the Agent, and all reasonable costs and expenses, including,
but not limited to, reasonable counsel fees and disbursements, paid or incurred
in investigating or defending against any such claim, demand, action, suit,
proceeding or investigation.
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D. The Agent shall be responsible for
and shall indemnify and hold the Company harmless from and against any and all
losses, damages, costs, charges, counsel fees, payments, expenses and liability
arising out of or attributable to Agent’s refusal or failure to comply with the
terms of this Agreement, or which arise out of Agent’s negligence or willful
misconduct or which arise out of the breach of any representation or warranty of
Agent hereunder, for which Agent is not entitled to indemnification under this
Agreement.
13. Changes
in Rights Certificate.
The Agent may, without the consent or concurrence of the Stockholders in
whose names Rights Certificates are registered, by supplemental agreement or
otherwise, concur with the Company in making any changes or corrections in a
Rights Certificate that it shall have been advised by counsel (who may be
counsel for the Company) is appropriate to cure any ambiguity or to correct any
defective or inconsistent provision or clerical omission or mistake or manifest
error therein or herein contained, and which shall not be inconsistent with the
provision of the Rights Certificate except insofar as any such change may confer
additional rights upon the Stockholders.
14. Assignment/Delegation.
A. Except as provided in Section 14(B)
below, neither this Agreement nor any rights or obligations hereunder may be
assigned or delegated by either party without the written consent of the other
party.
B. The Agent may, without further
consent on the part of the Company, subcontract with other subcontractors for
systems, processing, telephone and mailing services, and post-exchange
activities, as may be required from time to time; provided, however, that the
Agent shall be as fully responsible to the Company for the acts and omissions of
any subcontractor as it is for its own acts and omissions.
C. Except as explicitly stated
elsewhere in this Agreement, nothing under this Agreement shall be construed to
give any rights or benefits in this Agreement to anyone other than the Agent and
the Company and the duties and responsibilities undertaken pursuant to this
Agreement shall be for the sole and exclusive benefit of the Agent and the
Company.
15. Governing
Law. The
validity, interpretation and performance of this Agreement shall be governed by
the law of the State of New York and shall inure to the benefit of and the
obligations created hereby shall be binding upon the successors and permitted
assigns of the parties hereto.
16. Third
Party Beneficiaries.
This Agreement does not constitute an agreement for a partnership or
joint venture between the Agent and the Company. Neither party shall make any
commitments with third parties that are binding on the other party without the
other party’s prior written consent.
17. Force
Majeure. In the
event either party is unable to perform its obligations under the terms of this
Agreement because of acts of God, strikes, terrorist acts, equipment or
transmission failure or damage reasonably beyond its control, or other cause
reasonably beyond its control, such party shall not be liabile for damages to
the other for any damages resulting from such failure to perform or otherwise
from such causes. Performance under this Agreement shall resume when the
affected party or parties are able to perform substantially that party’s
duties.
18. Consequential
Damages. Neither
party to this Agreement shall be liable to the other party for any
consequential, indirect, special or incidental damages under any provisions of
this Agreement or for any consequential, indirect, penal, special or incidential
damages arising out of any act or failure to act hereunder even if that party
has been advised of or has foreseen the possibility of such
damages.
19. Severability. If any provision of this
Agreement shall be held invalid, unlawful, or unenforceable, the valididty,
legality, and enforceability of the remaining provisions shall not in any way be
affected or impaired.
20. Counterparts. This Agreement may be
executed in one or more counterparts, each of which shall be deemed an original
and all of which together shall be considered one and the same
agreement.
21. Captions.
The captions and descriptive headings herein are for the convenience of the
parties only. They do not in any way modify, amplify, alter or give full notice
of the provisions hereof.
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22. Confidentiality.
The Agent and the Company agree that all books, records, information and data
pertaining to the business of the other party which are exchanged or received
pursuant to the negotiation or the carrying out of this Agreement including the
fees for services set forth in the attached schedule shall remain confidential,
and shall not be voluntarily disclosed to any other person, except as may be
required by law.
23. Term and
Termination. This Agreement shall remain in effect until the earlier of
(a) 60 days after the Expiration Date; (b) it is terminated by either party upon
a material breach of this Agreement which remains uncured for 30 days after
written notice of such breach has been provided; or (c) 30 days’ written notice
has been provided by either party to the other. Upon termination of the
Agreement, the Agent shall retain all canceled Rights Certificates and related
documentation as required by applicable law.
24. Notices.
Until further notice in writing by either party hereto to the other party, all
written reports, notices and other communications between the Agent and the
Company required or permitted hereunder shall be delivered or mailed by first
class mail, postage prepaid, telecopier or overnight courier guaranteeing next
day delivery, addressed as follows:
If to the Company, to:
Hotel Outsource Management
International, Inc.
00 Xxxx Xxxxxx, Xxxxx 000
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx Xxxxx,
President
If to the Agent, to:
Standard Registrar & Transfer Co.
Inc.
00000 Xxxxx 0000 Xxxx
Xxxxxx, Xxxx 00000
Attention:
[ ]
25. Survival. The provisions of Paragraphs
12, 15, 17-19, 22, and 24-26 shall survive any termination, for any reason, of
this Agreement.
26. Entire
Agreement. This Agreement constitutes the entire agreement between the
parties hereto and supercedes any prior agreement with respect to the subject
matter hereof whether oral or written.
[Remainder of this page intentionally
left blank; Signature page follows]
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IN WITNESS WHEREOF, the parties hereto
have caused this Agreement to be executed by their respective officers, hereunto
duly authorized, as of the day and year first above written.
STANDARD
REGISTRAR & TRANSFER CO. INC.
By:
_____________________
Date:
____________________
Title:
____________________
HOTEL
OUTSOURCE MANAGEMENT INTERNATIONAL, INC.
By:
_____________________
Date:
____________________
Title:
____________________
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