EXHIBIT 10.1
SECURED SERVICES, INC.
SUBSCRIPTION AGREEMENT
THIS SUBSCRIPTION AGREEMENT, dated as of ________ __, 2003 (the
"Agreement") is entered into by and between SecureD Services, Inc. (f/k/a
Southern Software Group, Inc.), a Delaware corporation (the "Company"), and the
undersigned subscriber to purchase securities of the Company pursuant hereto
(the "Subscriber").
The Company is offering for sale up to 1,000,000 units (the "Units"), each
of which consists of three shares of its common stock, par value $0.0001 per
share (the "Common Stock") and one redeemable common stock purchase warrant (the
"Warrants") (the Units and the Common Stock and Warrants included therein as
well as the Common Stock issuable upon exercise of the Warrants are collectively
referred to herein as the "Restricted Securities"), at a price of $2.25 per
Unit, in consideration of cash only.
On the foregoing premises, the Subscriber hereby subscribes for the
purchase of such number of Units set forth on the signature page to this
Agreement on the following terms and conditions:
1. Subscription to Purchase Units
1.1 Offer to Purchase. Subject to the terms and conditions of this
Agreement, the Subscriber irrevocably subscribes to purchase at the
Closing as defined herein, the number of Units outlined on the Counterpart
Signature Page hereto.
With this Agreement, the Subscriber is also tendering to the Company
payment of the full subscription amount, in cash, a purchaser
representative disclosure and/or certificate of corporation, partnership
or other entity, if applicable and two copies of each of the following:
(i) a suitability letter, (ii) an executed copy of the Warrant Agreement,
(iii) an executed copy of the Lock-up/Leak-out Agreement. The foregoing
are sometimes hereinafter referred to as the "Subscription Documents."
1.2 Acceptance or Rejection. The acceptance or rejection of the
offer to purchase Units shall take place at such time and place within 15
days of the date hereof, as the Company may specify (which time and place
are designated as the "Closing"). At the Closing, the Company shall either
(i) accept this subscription (in whole or in part) and deliver to the
Subscriber certificates for the Common Stock and the Warrants included in
the Units, all against delivery to the Company of the full purchase price
of the Units equal to the subscription amount; or (ii) reject this
subscription and return to the Subscriber his/her/its subscription (or as
much thereof as is not accepted).
2. Representations. The Subscriber, singly, jointly or on behalf of an
entity subscribing, hereby represents and warrants as follows:
2.1 Age. The Subscriber or signatory is over the age of majority.
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2.2 No Governmental Approval. The Subscriber acknowledges that
neither the Securities and Exchange Commission nor the securities
commission of any state or any other federal agency has made any
determination as to the merits of purchasing the Units.
2.3 Information Provided by the Subscriber. All information which
the Subscriber has provided or is providing the Company, or to its agents
or representatives concerning the Subscriber's suitability to invest in
the Company is complete, accurate and correct as of the date of the
signature on the last page of this Agreement. Such information includes,
but is not limited to information concerning the Subscriber's personal
financial affairs, business position and the knowledge and experience of
the Subscriber and the Subscriber's advisors. The Company shall maintain
such information regarding the Subscriber in strict confidence except as
may be required to be disclosed to governmental agencies in support of an
available exemption from the registration requirements of applicable
securities laws, rules and regulations regarding the offer and sale of the
Units.
2.4 Information Provided by the Company. The Subscriber has been
provided with access to all material information requested by either the
Subscriber, the Subscriber's purchaser representative or others
representing the Subscriber, including any information requested to verify
any information furnished, and there has been direct communication between
the Company and its representatives on the one hand and the Subscriber and
the Subscriber's representatives and advisors on the other in connection
with information regarding the purchase made hereby. The Company has given
the Subscriber the opportunity to ask questions of and receive answers
from the Company and/or its directors, officers, employees or
representatives concerning the terms and conditions of this offering and
to obtain any additional information (to the extent the Company possesses
such information or can acquire it without unreasonable effort or expense)
desired or necessary to verify the accuracy of the information provided.
Any proprietary information disclosed or discovered by the Subscriber in
reviewing information made available to the Subscriber by the Company in
connection with the offer and sale of the Units shall be maintained by the
Subscriber in strict confidence.
2.5 Subscription Subject to Acceptance. The Subscriber acknowledges
that this Agreement may be accepted or rejected by the Company with
respect to all or part of the amount subscribed and that, to the extent
the subscription may be rejected, the accompanying cash subscription
payment will be refunded without payment of interest and without deduction
of expenses.
2.6 Financial Condition of the Subscriber. The Subscriber has
adequate means of providing for his/her/its current needs and possible
personal contingencies and has no need now, and anticipates no need in the
foreseeable future, to sell the Units or any of the other Restricted
Securities for which the undersigned hereby subscribes. The Subscriber
represents that Subscriber is able to bear the economic risks of this
investment
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and is able to hold the securities for an indefinite period of time and
has a sufficient net worth to sustain a loss of the entire investment, in
the event such loss should occur.
2.7 Purchase Entirely for Own Account. The Subscriber has no present
intention of dividing the Units or any of the other Restricted Securities
with others or of reselling or otherwise disposing of any portion of the
Units or other Restricted Securities unless covered by an effective
registration statement filed with the Securities and Exchange Commission
or there is an available exemption from such registration.
2.8 No Reliance on Unauthorized Representations. The Subscriber has
not specifically relied on any oral representations from the Company, or
any broker or salesman or their partners, shareholders, directors,
officers, employees or agents, except the following:
__________________________________________________________________________
__________________________________________________________________________
__________________________________________________________________________
2.9. Investment. The Restricted Securities will be held for
investment purposes and not with a view toward further distribution or
sale.
2.10. Unregistered Securities. The Subscriber has been advised by
the Company that the Restricted Securities have not been registered under
the Securities Act and are therefore not freely tradable.
2.11. Certificates and Legends. The Subscriber has been advised by
the Company that, without prior written approval of counsel for the
Company, all of the Common Stock included in the Units shall be
represented by one certificate only and all of the Warrants included in
the Units shall be represented by one certificate only and that all of the
shares of common Stock issuable upon exercise of the Warrants shall be
represented by one certificate only and that such certificates, to be
issued and delivered to me or my principal, shall be imprinted with the
following legend or a reasonable facsimile thereof on the front and
reverse sides thereof:
The stock transfer records of the Company reflect that no
certificate representing any of the Restricted Securities shall be
transferred unless the Company shall first have obtained, at the expense
of the holder of Restricted Securities an opinion of legal counsel to the
effect that they may be sold in accordance with applicable laws, rules and
regulations,
The securities represented by this certificate have not been
registered under the Securities Act of 1933, as amended, and may not
be sold or otherwise transferred unless compliance with the
registration provisions of such Act has been made or unless
availability of an exemption from such registration provisions has
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been established, or unless sold pursuant to Rule 144 under the Act.
Any request for more than one stock certificate or warrant
certificate must be accompanied by a letter signed by the requesting
holder setting forth all relevant facts relating to the request. The
Company will attempt to accommodate any request where it believes the
request is made for valid business or personal reasons so long as in its
sole discretion, the granting of the request will not facilitate a
"public" distribution of unregistered securities of the Company.
3. Indemnity. The Subscriber hereby agrees to indemnify the Company and
any person participating in the offering, and to hold them harmless, and to
grant them a right of set-off from and against any and all liability, damages,
cost or expense (including, but not limited to, reasonable attorneys' fees),
including the amount paid in settlement and whether or not suit is commenced,
incurred on account of or arising out of any inaccuracy in the Subscriber's
declarations, representations and warranties set forth in any portion of the
Subscription Documents executed and delivered by the Subscriber in connection
with his/her/its subscription for Units.
4. Setoff. Notwithstanding the provisions of the last preceding section or
the enforceability thereof, the Subscriber hereby grants the Company the right
of setoff against any amounts payable by the Company to the Subscriber for
whatever reason, before any and all damages, costs or expenses (including, but
not limited to, reasonable attorneys' fees) incurred on account of or arising
out of any of the items referred to in clauses (a) through (c) of the last
preceding section.
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5. Miscellaneous. The Subscriber further understands, acknowledges and
agrees that:
(a) This Agreement is not transferable or assignable by the
Subscriber.
(b) This Agreement shall be construed in accordance with and
governed by the laws of the State of Delaware.
(c) This Agreement constitutes the entire agreement between
the parties regarding the subject matter hereof.
(d) Notwithstanding any of the representations, warranties,
acknowledgments or agreements made herein by the Subscriber, the
Subscriber does not thereby or in any other manner waive any rights
granted to the Subscriber under federal or state securities laws.
(e) This Agreement does not entitle the Subscriber to any
rights as a shareholder of the Company's securities which are
comprised of with respect to any securities purchasable hereunder
which have not been fully paid for.
(f) Agrees to enter into the Lock-up/Leak-out agreement
attached to this subscription agreement as Schedule B.
(THIS SPACE INTENTIONALLY LEFT BLANK)
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COUNTERPART SIGNATURE PAGE TO
SECURED SERVICES, INC.
SUBSCRIPTION AGREEMENT
This Counterpart Signature Page for that certain Subscription
Agreement between SecureD Services, Inc., a Delaware corporation (the
"Company"), and the undersigned Subscriber to purchase securities of the Company
pursuant thereto, is executed by the undersigned as of the date hereof. The
undersigned, through execution and delivery of this Counterpart Signature page,
intends to be legally bound by the terms of such Agreement.
Date: _______ ___, 2003
------------------------------------ ----------------------------------------
Name of Subscriber (Print) Name of Joint Subscriber, If Any (Print)
------------------------------------ ----------------------------------------
Signature Signature
------------------------------------ ----------------------------------------
Xxxxxx Xxxxxxx Xxxxxx Xxxxxxx (If Different)
------------------------------------ ----------------------------------------
City, State and Zip Code City, State and Zip Code (If Different)
------------------------------------ ----------------------------------------
Tax I.D. Number or Social Security Tax I.D. Number or Social Security
Number Number
Number of Units:____, including ___ shares $___________________________
of Common Stock and ____ Warrants Total Subscription Price
ACCEPTANCE BY THE COMPANY
SecureD Services, Inc. hereby accepts the foregoing subscription and
agrees to be bound by the terms of this Agreement.
SecureD Services, Inc.,
a Delaware corporation
Date: By:
-------------- ---------------------------------
Name:
-------------------------------
Title:
------------------------------
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SECURED SERVICES, INC.
SUITABILITY LETTER
TO: SecureD Services, Inc.
C/o Morse, Zelnick, Rose & Lander
000 Xxxx Xxxxxx, Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 10022.4405
Singly or on behalf of a subscribing entity, I make the following
representations with the intent that they may be relied upon by SecureD
Services, Inc. (the "Company"), in determining my suitability or that of my
principal as a subscriber (the "Subscriber") to purchase the Company's Units (as
defined in the Subscription Agreement, dated as of ________ __, 2003) at a
purchase price of $2.25 per Unit, in consideration of cash.
1. I have such knowledge and experience in business and financial
matters that I am capable of evaluating the Company, its proposed business
activities and the risks and merits of this prospective investment, and am not
utilizing a purchaser representative as defined in Regulation D promulgated
under the Securities Act of 1933, as amended (the "Securities Act"), in
connection with the evaluation of such risks and merits, except the following:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
2. I shall provide a separate written statement from each purchaser
representative on the Subscriber Representative Acknowledgment form available
from the Company or its placement agents in which is disclosed (i) the
relationship of the purchaser representative with the Company, if any, which has
existed at any time during the previous two years, (ii) the compensation
received or to be received as a result of such relationship, and (iii) the
education, experience and knowledge in financial and business matters which
enables the purchaser representative to evaluate the relative merits and risks
of an investment in the Company.
3. The undersigned, or the undersigned and the purchaser
representatives listed above together have such knowledge and experience in
financial and business matters that they are capable of evaluating the Company
and the proposed activities thereof and the merits and risks of this prospective
investment.
4. I have adequate means of providing for my current needs and
possible personal contingencies and have no need in the foreseeable future for
liquidity of an investment in the Company.
5. I confirm that I am an "accredited investor" as defined under
Rule 501 of Regulation D promulgated under the Securities Act as checked below:
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(a) Any bank as defined in Section 3(a)(2) of the Securities
Act or any 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; any broker or dealer registered pursuant to Section
15 of the Securities Exchange Act of 1934; any insurance company as
defined in Section 2(13) of the Securities Act; any 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; any small
business investment company licensed by the U.S. Small Business
Administration under Section 301(c) or (d) of the Small Business
Investment Act of 1958; any employee benefit plan within the meaning of
the Employee Retirement Income Security Act of 1974, if the investment
decision is made by a plan fiduciary, as defined in Section 3(21) of such
Act, which is either a bank, savings and loan association, insurance
company, or registered investment advisor, or if the employee benefit plan
has total assets in excess of $5,000,000 or, if a self-directed plan, with
investment decisions made solely by persons that are accredited investors;
|_| Yes |_| No
(b) Any private business development company as defined in
Section 202(a)(22) of the Investment Advisors Act of 1940;
|_| Yes |_| No
(c) Any 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 securities offered, with total assets in excess of $5,000,000;
|_| Yes |_| No
(d) Any director, executive officer, or general partner of the
issuer of the securities being offered or sold, or any director, executive
officer, or general partner of a general partner of that issuer;
|_| Yes |_| No
(e) Any natural person whose individual net worth, or joint
net worth with the person's spouse, at the time of this purchase exceeds
$1,000,000;
|_| Yes |_| No
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(f) Any natural person who had an individual net income in
excess of $200,000 in each of the two most recent fiscal years or joint
income with the person's spouse in excess of $300,000 in each of those two
years and has a reasonable expectation of reaching the same income level
in the current fiscal year;
|_| Yes |_| No
(g) Any trust, with total assets in excess of $5,000,000, not
formed for the specific purpose of acquiring the securities offered, whose
purchase is directed by a sophisticated person as described in Section
230.506(b)(2)(ii); and
|_| Yes |_| No
(h) Any entity in which all of the equity owners are
accredited investors.
|_| Yes |_| No
If not an "accredited investor", I am a "sophisticated investors", who, by
reason of business acumen, experience, employment or other factors, are fully
capable of evaluating the risks and merits of an investment in the Company.
|_| Yes |_| No
or
I am a "non-U. S. Person" as defined in Regulation S promulgated
under the Securities Act.
|_| Yes |_| No
6. I have previously been advised that I would have an opportunity
to review all the pertinent facts concerning the Company, and to obtain any
additional information that I might request, to the extent possible or
obtainable, without unreasonable effort and expense, in order to verify the
accuracy of the information provided me by the Company.
7. I have personally communicated or been offered the opportunity to
communicate with the directors or executive officers of the Company, its
attorneys and accountants to discuss the proposed business and financial affairs
of the Company, its proposed activities and plans for the future. I acknowledge
that if I would like to further avail myself of the opportunity to ask
additional questions of the Company, the Company will make arrangements for such
an opportunity on request.
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8. I have been advised that no accountant or attorney engaged by the
Company is acting as my representative, accountant or attorney.
9. I will hold title to my interest as follows:
|_| Community Property |_| Separate Property
|_| Joint Tenants with Rights |_| Tenants in Common
of Survivorship |_| Other (Single Person, Trust,
Etc. Please Indicate.)
10. I am a bona fide resident of the State of __________. The
address below is my true and correct principal residence.
DATED this _____ day of _____________________, 2003.
------------------------------------ --------------------------------------
Name (Please Print) Name of Joint Subscriber, If Any
------------------------------------ ---------------------------------------
Signature Signature
------------------------------------ ---------------------------------------
Xxxxxx Xxxxxxx Xxxxxx Xxxxxxx (If Different)
------------------------------------ ---------------------------------------
City, State and Zip Code City, State and Zip Code (If Different)
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SECURED SERVICES, INC.
SUBSCRIBER REPRESENTATIVE ACKNOWLEDGMENT
Confirmation of Appointment by Subscriber
Name of Subscriber:_________________________________________________________
The undersigned (the "Subscriber") has appointed the person named
below as the Subscriber's representative in connection with the proposed
purchase of the Company's Units (as defined in the Subscription Agreement, dated
as of _______ __, 2003) at a purchase price of $2.25 per Unit.
Signature of Subscriber: _____________________________________________________
Acknowledgment by Subscriber Representative
Please complete the following questions fully, attaching additional sheets
if necessary.
1. Name: ________________________________________________________________
Age: ___________
Business Address: ___________________________________________________________
_____________________________________________________________________________
2. Present occupation or position, indicating period of such practice or
employment and field or professional specialization, if
any:____________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
3. List any business or professional education, including degrees received, if
any:
________________________________________________________________________________
________________________________________________________________________________
4. Have you had prior experience in advising clients with respect to investments
of this type:
|_| Yes |_| No
5. List any professional license or registrations, including bar admissions,
accounting certifications, real estate brokerage licenses, and SEC or state
broker-dealer registration, that you hold:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
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6. Describe generally any business, financial or investment experience that
would help you to evaluate the merits and risks of this investment:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
7. State how long you have known the Subscriber and in what capacity:
________________________________________________________________________________
8. Except as set forth in subparagraph (a) below, neither I nor any of my
affiliates (as such term is defined in Rule 405 under the Securities Act of
1933, as amended) have any material relationship with the Company or any of its
affiliates; no such material relationship has existed at any time during the
previous two years; and no such material relationship is mutually understood to
be contemplated:
(a) ______________________________________________________________________
(b) If a material relationship is disclosed in subparagraph (a) above,
indicate the amount of compensation received or to be received as a result of
such relationship:
________________________________________________________________________________
9. In advising the Subscriber in connection with the Subscriber's prospective
investment in the Company, I will be relying in part on the Subscriber's own
expertise in certain areas.
|_| Yes |_| No
10. In advising the Subscriber in connection with the Subscriber's prospective
investment in the Company, I will be relying in part on the expertise of an
additional purchaser representative or representatives.
|_| Yes |_| No
I understand that the Company will be relying on the accuracy and
completeness of my responses to the foregoing questions, and I represent and
warrant to the Company as follows:
(a) I am acting as Subscriber Representative for the Subscriber in
connection with the Subscriber's prospective investment in the Company;
(b) The answers to the above questions are complete and correct and may be
relied on by the Company in determining whether the offering with respect to
which I have executed this Acknowledgment is exempt from registration under the
Securities Act of 1933, as amended, and applicable state securities statutes;
Page 12
(c) I will notify the Company immediately of any material change in any
statement made herein occurring prior to the closing of any purchase by the
Subscriber of any interest in the proposed investment;
(d) I am not an affiliate, partner or employee of the Company or an
affiliate, partner, officer, director or other employee of the Company's
affiliates, or a beneficial owner of 10% or more of any class of the equity
securities of the Company or any of its affiliates;
(e) I have disclosed to the Subscriber in writing prior to the
Subscriber's acknowledgment of me as his/her/its Subscriber Representative, any
material relationship with the Company or its affiliates disclosed in response
to question 8 above; and
(f) I personally (or, if I have checked "Yes" in question 9 or 10 above,
together with the Subscriber or the Additional Subscriber Representative or
Representatives indicated above) have such knowledge and experience in financial
and business matters that I am capable of evaluating the merits and risks of the
Subscriber's prospective investment in the Company.
EXECUTED as of this _____ day of _______________, 2003.
-----------------------------------
Subscriber Representative Signature
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SECURED SERVICES, INC.
CERTIFICATE OF PARTNERSHIP, CORPORATION OR OTHER ENTITY
The undersigned, ___________________________________________________ (the
"Subscriber"), a _______________________________ [insert type of entity, i.e.,
partnership, corporation, etc.] organized under the laws of the State of
__________________ with its principal offices located at the address set forth
below, hereby certifies as follows to induce SecureD Services, Inc. (the
"Company"), to accept the Subscriber's offer to purchase the Company's Units (as
defined in the Subscription Agreement, dated as of _____ __, 2003) at a purchase
price of $2.25 per Unit, payable in cash:
1. Pursuant to valid and legally binding documents filed at the time and
in the manner required by the laws of the state under which Subscriber was
organized as stated above, Subscriber was formed on _______________________.
2. Subscriber was organized to engage in the business of _________________
_____________________________. Since its organization, Subscriber's business
activities have included the following: __________________________________
_______________________________________________________________________________.
Subscriber was not organized for the specific purpose of purchasing the
Company's securities.
3. The offer to purchase the Units to be sold by the Company has been
approved by the governing authority of Subscriber in accordance with the power
vested in it by applicable law and the documents under which the Subscriber was
organized and exists.
4. Subscriber has determined that the purchase of the Units is consistent
with its purposes and policies, is of benefit to it and involves risks that it
can reasonably bear.
5. On request of the Company, Subscriber shall deliver a certified copy of
resolutions duly adopted by the board of directors, general partners, trustees
or other governing authority of Subscriber and provide further evidence of the
authority and power of Subscriber to make the investment described herein.
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The Subscriber has caused this document to be executed by the Subscriber's
representative or agent, hereunto duly authorized as of ___________________,
2003.
FOR REQUIRED SIGNATURES, SEE NOTE BELOW.
------------------------------------
Address: Name of Subscriber
-----------------------------------
----------------------------------- ------------------------------------
Signature of Authorized Signatory
------------------------------------
Title
NOTE: Corporations: must be signed by a president or vice-president
Partnerships: must be signed by all general partners Trusts: must be
signed by all managing trustees Others: contact the issuer
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