SUBSCRIPTION AGREEMENT
Exhibit 10.1
This
Subscription Agreement dated as of December 30, 2005 (the “Agreement”) is entered into by
and among Amalgamated Technologies, Inc., a Delaware corporation (the “Company”), and the
individuals and entities listed on Exhibit A hereto (the “Purchasers”).
BACKGROUND
WHEREAS, the Company is offering in a private placement to “accredited investors” (as such
term in defined in Regulation D (“Regulation D”) promulgated under the Securities Act of 1933, as
amended (the “Securities Act”) up to 3,500,000 shares of common stock, $0.0001 par value per share,
of the Company (the “Common Stock”) (each share of Common Stock is being sold at an offering price
of $1.00 per share) (the “Offering”);
WHEREAS, the Company has engaged Xxxxxxxx Curhan Ford & Co (the “Placement Agent”) as
placement agent for the Offering on a “best-efforts” basis.
WHEREAS, the Purchaser desires to purchase that number of shares of Common Stock set forth on
the signature page hereof on the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and the mutual representations and covenants
hereinafter set forth, the parties hereto agree as follows:
1. Authorization and Sale of Shares.
1.1 Authorization. The Company has duly authorized the sale and issuance, pursuant to
the terms of this Agreement, of up to 3,500,000 shares of its Common Stock.
1.2 Sale of Shares. Subject to the terms and conditions of this Agreement, at the
Closing, the Company will sell and issue to each of the Purchasers, and each of the Purchasers will
purchase, the number of shares of Common Stock set forth opposite such Purchaser’s name on
Exhibit A for the purchase price of $1.00 per share. The shares of Common Stock being sold
under this Agreement are sometimes hereinafter collectively referred to as the “Securities.” The
Company’s agreement with each of the Purchasers is a separate agreement, and the sale of Securities
to each of the Purchasers is a separate sale.
To subscribe for Securities, this Agreement must be properly completed, executed and delivered
to American Stock Transfer and Trust Company, 00 Xxxxxx Xxxx, Xxx Xxxx, XX 00000, Attention: Xxxxx
Xxxxxxxx, accompanied by a check payable to “American Stock Transfer and Trust Company, Escrow
Agent for Amalgamated Technologies, Inc.” (the “Escrow Agent”). A Purchaser desiring to deliver
the purchase price for the Securities in the form of wire transfer shall wire to the Escrow Agent
at: XX Xxxxxx, 00 Xxxxx Xxxxxx, Xxx Xxxx, XX 00000, ABA#: 021 000 021 , Account #
323 836 917. If the purchase price is paid by wire transfer, the Purchaser
shall (i) include the Purchaser’s name in the wire transfer instructions; and (ii) request from the
bank or other financial institution that is originating the transfer the federal wire number with
respect to the and retain that number for future reference.
1.3 Use of Proceeds. The Company will use the proceeds from the sale of the
Securities for working capital and general corporate purposes of its subsidiary ProLink Solutions,
LLC.
2. The Closing. The closing of the sale and purchase of 3,500,000 Securities under
this Agreement shall take place at such time and place as the Company may designate (the “Closing,”
and the date on which the Closing occurs, the “Closing Date”). The Offering shall terminate on
December 30, 2005. There is no assurance that any Securities will be sold or that the Closing will
occur. In the event that the Closing does not occur, the Company and the Placement Agent will
direct the Escrow Agent to return any money that a prospective purchaser may have delivered to the
Escrow Agent.
Promptly following the Closing, the Company shall deliver to each of the Purchasers a
certificate for the number of shares of Common Stock being purchased by such Purchaser, registered
in the name of such Purchaser, against payment to the Company of the purchase price therefor by
check or wire transfer, as specified in Exhibit A.
The Purchaser hereby authorizes and directs the Company to deliver the Securities to be issued
to the Purchaser pursuant to this Agreement directly to the residential or business address
indicated on the signature page hereto.
3. Representations of the Purchasers. Each of the Purchasers severally represents and
warrants to the Company as follows:
(a) The Purchaser hereby represents that the Purchaser has been furnished by the Company
during the course of this transaction with and has carefully read the Company’s filings (the “SEC
Filings”) with the United States Securities and Exchange Commission (the “Commission”), including,
without limitation, the Company’s Current Report on Form 8-K filed with the Commission on December
23, 2005, a copy of which is attached hereto as Exhibit B (together with the SEC Filings,
the “Offering Documents”), and all other information regarding the Company which the Purchaser has
requested or desired to know.
(b) The Purchaser has had a reasonable opportunity to ask questions of and receive answers
from the Company concerning the Company and the Offering, and all such questions, if any, have been
answered to the full satisfaction of the Purchaser.
(c) The Purchaser understands that the Company has determined that the exemption from the
registration provisions of Section 4(2) of the Securities Act and Regulation D promulgated
thereunder is applicable to the offer and sale of the Securities, based, in part, upon the
representations, warranties and agreements made by the Purchaser herein. The Purchaser hereby
acknowledges that the Offering has not been reviewed by the Commission.
(d) Except as set forth herein, no representations or warranties have been made to the
Purchaser by the Company or any agent, employee or affiliate of the Company and in entering into
this transaction, the Purchaser is not relying upon any information other than the results of
independent investigation by the Purchaser.
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(e) The Purchaser has full power and authority to execute and deliver this Agreement and to
perform the obligations of the Purchaser hereunder and this Agreement is a legally binding
obligation of the Purchaser in accordance with its terms.
(f) Regulation D.
(i) The Purchaser understands and acknowledges that: (A) the Securities acquired pursuant to
this Agreement have not been registered under the Securities Act and are being sold in reliance
upon an exemption from registration afforded by Regulation D; and that such Securities have not
been registered with any state securities commission or authority; (B) pursuant to the requirements
of Regulation D, the Securities may not be transferred, sold or otherwise exchanged unless in
compliance with the provisions of Regulation D and/or pursuant to registration under the Securities
Act, or pursuant to an available exemption thereunder; and (C) other than as set forth in Section
5.1 of this Agreement, the Company is under no obligation to register the Securities under the
Securities Act or any state securities law, or to take any action to make any exemption from any
such registration provisions available.
(ii) The Purchaser represents that (i) no Securities were offered or sold to it by means of
any form of general solicitation or general advertising, and in connection therewith the Purchaser
did not (A) receive or review any advertisement, article, notice or other communication published
in a newspaper or magazine or similar media or broadcast over television or radio, whether closed
circuit or generally available; or (B) attend any seminar, meeting or industry investor conference
whose attendees were invited by any general solicitation or general advertising.
(iii) The Purchaser is an accredited investor within the meaning of Rule 501 of Regulation D,
is knowledgeable, sophisticated and experienced in making, and is qualified to make, decisions with
respect to investment shares representing an investment decision like that involved in the purchase
of the Securities.
(iv) The Purchaser is purchasing the Securities for his, her or its own account for investment
only and has no intention of selling or distributing the Securities and no other person has any
interest in or participation in the Securities or any right, option, security interest, pledge or
other interest in or to the Securities. The Purchaser recognizes that an investment in the
Securities involves a high degree of risk, including a risk of total loss of the Purchaser. The
Purchaser understands, acknowledges and agrees that it must bear the economic risk of its
investment in the Securities for an indefinite period of time and has knowledge and experience in
financial and business matters such that it is capable of evaluating the risks of the investment in
the Securities and the Purchaser understands, acknowledges and agrees that prior to any such offer
or sale, the Company may require, subject to the fulfillment of the Company’s obligations under
Section 5 of this Agreement, as a condition to effecting a transfer of the Securities, an opinion
of counsel, acceptable to the Company, as to the registration or exemption therefrom under the
Securities Act and any state securities acts, if applicable.
(v) The Purchaser acknowledges that the Securities will bear a legend in substantially the
following form:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE (THE “SECURITIES”) HAVE NOT
BEEN REGISTERED UNDER THE
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SECURITIES ACT OF 1933, AS AMENDED (THE
“SECURITIES ACT”) OR ANY STATE SECURITIES LAWS AND MAY NOT BE SOLD,
TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS REGISTERED UNDER THE SECURITIES
ACT AND UNDER APPLICABLE STATE SECURITIES LAWS OR AMALGAMATED TECHNOLOGIES,
INC. SHALL HAVE RECEIVED AN OPINION OF ITS COUNSEL THAT REGISTRATION OF SUCH
SECURITIES UNDER THE SECURITIES ACT AND UNDER THE PROVISIONS OF APPLICABLE
STATE SECURITIES LAWS IS NOT REQUIRED.
(g) Neither the Purchaser, nor any affiliate of the Purchaser or any person acting on his, her
or its behalf, has recently sold shares of unregistered Common Stock of the Company.
(h) The Purchaser understands that the Company will review this Agreement and, if such
Purchaser is an individual, hereby gives authority to the Company to call Purchaser’s bank or place
of employment (in a call in which the Placement Agent participates) or otherwise review the
financial standing of the Purchaser; and it is further agreed that upon their mutual agreement the
Placement Agent and the Company reserve the unrestricted right, without further documentation or
agreement on the part of the Purchaser, to reject or limit any subscription, to accept
subscriptions for Securities and to close the Offering to the Purchaser at any time.
(i) The Purchaser represents and warrants that the Purchaser is not (a) a broker or dealer
admitted to membership in the National Association of Securities Dealers, Inc. (“NASD”), (b) a
controlling stockholder of an NASD member, or (c) a person associated with a member of the NASD
(j) The Purchaser represents and warrants that it has not engaged, consented to nor authorized
any broker, finder or intermediary to act on its behalf, directly or indirectly, as a broker,
finder or intermediary in connection with the transactions contemplated by this Agreement. The
Purchaser shall indemnify and hold harmless the Company from and against all fees, commissions or
other payments owing to any such person or firm acting on behalf of such Purchaser hereunder.
(k) The Purchaser acknowledges that (a) the Company has engaged, consented to and authorized
the Placement Agent in connection with the transactions contemplated by this Agreement, (b) the
Company shall pay the Placement Agent a commission and reimburse the Placement Agent’s expenses and
the Company shall indemnify and hold harmless the Purchaser from and against all fees, commissions
or other payments owing by the Company to the Placement Agent or any other person or firm acting on
behalf of the Company hereunder and (c) registered representatives of the Placement Agent and/or
its designees (including, without limitation, registered representatives of the Placement Agent
and/or its designees who participate in the Offering and sale of the securities sold in the
Offering) will be paid a portion of the commissions paid to the Placement Agent.
(l) The Purchaser agrees that from the time the Purchaser was first contacted by the Placement
Agent regarding the Offering, until a point in time equal to four months from the date hereof, the
Purchaser has not and shall not, directly or indirectly, through related parties, affiliates or otherwise, (A) sell “short” or “short against the box” (as those terms are generally
understood) any
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equity security of the Company or (B) otherwise engage in any transaction that
involves hedging of the Purchaser’s position in any equity security of the Company.
(m) The Company may terminate the Offering or reject any subscription, in whole or in part, at
any time in its sole discretion. The execution of this Agreement by the Purchaser or solicitation
of the investment contemplated hereby shall create no obligation on the part of the Company or the
Placement Agent to accept any subscription or complete the Offering.
4. Condition to the Obligations of the Company. The obligations of the Company under
Section 1.2 of this Agreement are subject to fulfillment, or the waiver, of the following condition
on or before the Closing:
4.1 Accuracy of Representations and Warranties. The representations and warranties of
the Purchasers contained in Section 3 shall be true on and as of the Closing Date with the same
effect as though such representations and warranties had been made on and as of that date (except
that any representation or warranty expressly stated to have been made or given as of a specific
date need be true only as of such date).
5. Covenants of the Company.
5.1 Piggyback Registration Rights. If at any time the Company shall determine to
register under the Securities Act any of its securities (other than on Form S-8 or Form S-4 or
their then equivalents and other than shares to be issued solely (i) in connection with any
acquisition of any entity or business (ii) upon the exercise of stock options, or (iii) pursuant to
employee benefit plans), it shall send to each holder of Registrable Shares (as defined below),
including each holder who has the right to acquire Registrable Shares, written notice of such
determination and, if within thirty (30) days after receipt of such notice, such holder shall so
request in writing, the Company shall use its commercially reasonable efforts to include in such
registration statement all or any part of the Registrable Shares such holder requests to be
registered therein; provided that, if, in connection with any offering involving an underwriting of
Common Stock to be issued by the Company, the managing underwriter shall prohibit the inclusion of
shares of Common Stock by selling holders in such registration statement or shall impose a
limitation on the number of shares of such Common Stock which may be included in any such
registration statement because, in its judgment, such limitation is necessary to effect an orderly
public distribution, and such limitation is imposed pro rata with respect to all securities whose
holders have a contractual, incidental (“piggyback”) right to include such securities in the
registration statement and as to which inclusion has been requested pursuant to such right and
there is first excluded from such registration statement all shares of Common Stock sought to be
included therein by (i) any holder thereof not having any such contractual, incidental registration
rights, and (ii) any holder thereof having contractual, incidental registration rights subordinate
and junior to the rights of the holders of Registrable Shares, the Company shall then be obligated
to include in such registration statement only such limited portion (which may be none) of the
Registrable Shares with respect to which such holder has requested inclusion hereunder.
“Registrable Shares” means the shares of Common Stock sold in the Offering; provided, however, that
shares of Common Stock shall cease to be Registrable Shares upon any sale of such shares pursuant
to (i) a registration statement filed under the Securities Act, or (ii) Rule 144 promulgated under
the Securities Act.
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6. Transfer of Securities. The Purchaser is aware that the Company will make a
notation in its appropriate records and issue “stop transfer” instructions to its transfer agent
with respect to the restrictions on the transferability of such Securities.
(a) The Purchaser understands that this subscription is not binding upon the Company until the
Company accepts it, which acceptance is at the sole discretion of the Company and is to be
evidenced by the Company’s execution of this Agreement where indicated. This Agreement shall be
null and void if the Company does not accept it as aforesaid. In the event the Company does not
accept the Offering proceeds, the Offering will not be completed and all Offering proceeds will
thereafter be promptly returned to the Purchasers without interest or deduction. The undersigned
understands that the Company may, in its sole discretion, reject this subscription, in whole or in
part, and/or reduce this subscription in any amount and to any extent, whether or not pro rata
reductions are made of any other investor’s subscription.
(b) Subject to applicable state securities laws, the subscription delivered to the Company by
the Purchaser pursuant to this Agreement is not subject to revocation by the Purchaser, but may be
rejected by the Company, in whole or in part, in the Company’s sole discretion, in which event the
purchase price and execution copy of this Agreement submitted will be returned (by mail) to the
undersigned without interest or deduction within 15 business days thereafter.
7. The Shares are subject to standard anti-dilution provisions in the event of forward or
reverse stock splits or recapitalizations. For example, if the Company engages in a two for one
reverse stock split, a holder of 100,000 Shares will be affected as follows:
Pre-Split Ownership:
100,000 Shares
Post-Split Ownership:
50,000 Shares
8. Miscellaneous.
8.1 Successors and Assigns. This Agreement and any rights and obligations hereunder
may not be transferred or assigned by the Purchaser without the prior written consent of the
Company. This Agreement shall inure to the benefit of, and be binding upon the Company and the
Purchaser and their respective heirs, legal representatives and permitted assigns.
8.2 Survival. All representations and warranties and all covenants, agreements and
obligations made by the Company or the Purchasers in this Agreement, or in any instrument or
document furnished in connection with this Agreement or the transactions contemplated hereby, shall
survive the Closing and any investigation at any time made by or on behalf of any indemnified
party.
8.3. Indemnification. The Purchaser agrees to indemnify the Company and hold it
harmless from and against any and all losses, damages, liabilities, costs and expenses which it may
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sustain or incur in connection with the breach by the Purchaser of any representation,
warranty or covenant made by the Purchaser.
8.4 Notices. All notices or other communications hereunder shall be in writing and
shall be deemed to have been duly given if delivered personally or mailed by certified or
registered mail, return receipt requested, postage prepaid, as follows:
(a) If to the Company, to Amalgamated Technologies, Inc., 0000 Xxxxx Xxxxxx Xxxx, Xxxxx, XX
00000, Attention: Chief Executive Officer or to such other address as the Company or the
undersigned shall have designated to the other by like notice.
(b) If to a Purchaser, at his, her or its address set forth on Exhibit A, or at such
other address or addresses as may have been furnished to the Company in writing by such Purchaser.
8.5 Entire Agreement. This Agreement embodies the entire agreement and understanding
between the parties hereto with respect to the subject matter hereof and supersede all prior
agreements and understandings relating to such subject matter.
8.6 Amendments and Waivers. Except as otherwise expressly set forth in this
Agreement, any term of this Agreement may be amended and the observance of any term of this
Agreement may be waived (either generally or in a particular instance and either retroactively or
prospectively) with the written consent of the Company and the majority of the Purchasers. No
waivers of or exceptions to any term, condition or provision of this Agreement, in any one or more
instances, shall be deemed to be, or construed as, a further or continuing waiver of any such term,
condition or provision.
8.7 Counterparts. This Agreement may be executed in one or more counterparts, each of
which shall be deemed to be an original, but all of which shall be one and the same document.
8.8 Section Headings. The section headings are for the convenience of the parties and
in no way alter, modify, amend, limit, or restrict the contractual obligations of the parties.
8.9 Severability. The invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other provision of this Agreement.
8.10 Governing Law. This Agreement shall be governed by and construed in accordance
with the laws of the State of Delaware.
[signature page to follow]
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SIGNATURE PAGE
Date Signed:
|
December ___, 2005 | |||
Number of Securities:
|
||||
Multiplied by Offering Price Per Share:
|
x | $1.00 | ||
Equals Amount: =
|
$ | |||
Signature
|
Signature | |
| (if purchasing jointly) | ||
Printed Name
|
Printed Second Name | |
Entity Name
|
Entity Name | |
Address
|
Address | |
City, State and Zip Code
|
City, State and Zip Code | |
Telephone – Business
|
Telephone – Business | |
Facsimile – Business
|
Facsimile – Business | |
Tax ID# or Social Security #
|
Tax ID# or Social Security # |
Name in which securities should be issued:
|
||
This
Agreement is agreed to and accepted as of December 30, 2005.
| AMALGAMATED TECHNOLOGIES, INC. |
||||
| By: | /s/ Xxxxxxxx X. Xxxx | |||
| Name: | Xxxxxxxx X. Xxxx | |||
| Title: | President | |||
EXHIBIT A
List of Purchasers
List of Purchasers
| Name and Address | Aggregate | |||
| of Purchaser | No. of Units | Purchase Price | ||
| $ | ||||
| $ | ||||
| $ | ||||
| $ | ||||
| $ | ||||
| $ | ||||
| $ | ||||
| $ | ||||
| $ | ||||
| TOTALS:
|
$ |
EXHIBIT B
