Exhibit 10.9
ESYS HOLDINGS, INC.
SUBSCRIPTION AGREEMENT
INSTRUCTIONS
Each prospective investor must complete, execute and submit the following:
(1) The Subscription Agreement;
(2) The Accredited Investor Questionnaire;
(3) The signature page to the Security Agreement;
(4) The signature page to the Registration Rights Agreement; and
(5) A check or money order made payable to Signature Bank, as Escrow Agent
for ESYS Holdings, Inc. in the amount of the purchase price for the
notes and warrants ("Securities") subscribed for by the investor, or
funds can be wired as follows:
Bank: Signature Bank
Address: 0000 Xxxxxxxx Xxxxxx, Xxxxxx Xxxx, Xxx Xxxx 00000
ABA No.:
Beneficiary Name: Signature Bank As Escrow Agent For ESYS Holdings, Inc.
Account No.:
The foregoing materials should be delivered via a trackable delivery system
(overnight delivery) to:
vFinance Investments, Inc.
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxxxx Xxxx
(6) If and when accepted by ESYS Holdings, Inc., a Delaware corporation
(the "Company"), this Agreement shall constitute a subscription for
Securities of the Company. The minimum investment is $50,000, unless
waived by the Company.
(7) The Company reserves the right to reject in its entirety any
subscription which is tendered or to allocate to any prospective
purchaser a smaller number of Securities than the prospective
purchaser has subscribed to purchase. In such event, the Company will
return to you this Agreement and your payment (or a pro rata portion
of your payment, if such subscription is rejected only in part),
without interest or deduction.
(8) An accepted copy of this Agreement and a Debenture and Warrant issued
in your name will be returned to you shortly after the closing of the
Offering.
ALL SUBSCRIPTION DOCUMENTS MUST BE COMPLETE AND ONLY THE PROSPECTIVE INVESTOR'S
PRINCIPAL RESIDENCE SHOULD BE STATED.
SUBSCRIPTION AGREEMENT
Name of Subscriber ___________________
ESYS Holdings, Inc.
0000 Xxxxxxxx Xxxxxxx Xxxxx
Xxxxxx Xxxx, XX 00000
Ladies and Gentlemen:
1. Subscription. I (sometimes referred to herein as the "Investor") hereby
subscribe for and agree to purchase securities (the "Securities") comprised of
10% Senior Secured Convertible Debentures (the "Notes") and Warrants to purchase
common stock (the "Warrants") of ESYS Holdings, Inc., a Delaware corporation
(the "Company"), on the terms and conditions described herein (including the
exhibits hereto, collectively referred to as the "Offering Documents").
The Minimum Offering is $2,500,000 and the Maximum Offering is $5,000,000.
At the option of the Company, additional monies up to 20% of the Maximum
Offering may also be accepted. The aggregate amount subscribed for hereby is
$___________. I understand that a closing will not be held until the Minimum
Offering is received and accepted by the Company and upon the closing of a share
exchange transaction between the Company and shareholders of Perf-Go Green Inc.
(the "Share Exchange") and that additional closings may be held at any time
thereafter until the Termination Date (as defined below).
The Notes have a term of three years from the date of closing and carry an
interest rate of 10% per annum. Notes may be converted into shares of the
Company's Common Stock at an initial conversion price of $0.75 per share. The
obligations of the Company under the Notes shall be secured pursuant to the
terms of the Security Agreement annexed hereto as Exhibit C (the "Security
Agreement"). The Warrants shall be exercisable for a period of five years at an
exercise price of $1.00 per share. Warrants shall be convertible into that
number of shares of Common Stock equal to 100% of the shares issuable upon
conversion of the Notes. The holders of the shares of Common Stock issuable upon
conversion of the Notes and exercise of the Warrants shall be entitled to
certain registration rights pursuant to the terms of the Registration Rights
Agreement annexed hereto as Exhibit D. I understand and acknowledge that the
foregoing summary of the Offering Documents is qualified in its entirety by
reference to the Offering Documents annexed hereto.
2. Purchase.
(a) I hereby tender to the Company a check, money order, or wire transfer
in the amount indicated above, an executed copy of this Subscription Agreement,
an executed copy of my Investor Questionnaire and an executed copy of the
Security Agreement.
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(b) This offering will continue until the earlier of (i) the sale of all of
the Maximum Offering or (ii) April 30, 2008, unless extended one or more times
by the Company without notice to the Investors, ("Termination Date"). Prior to
the Termination Date, payments delivered herewith will be held in an escrow
account subject to the terms and conditions herein. Upon the earlier of a
closing for my subscription or completion of the offering, I will be notified
promptly by the Company as to whether my subscription has been accepted by the
Company.
3. Acceptance or Rejection of Subscription.
(a) I understand and agree that the Company reserves the right to reject
this subscription for the Securities, in whole or in part, for any reason and at
any time prior to the Closing, notwithstanding prior receipt by me of notice of
acceptance of my subscription.
(b) In the event of the rejection of this subscription, my subscription
payment will be promptly returned to me without interest or deduction and this
Subscription Agreement shall have no force or effect. In the event my
subscription is accepted and the offering is completed, the funds specified
above shall be released to the Company.
4. Closing. The closing ("Closing") of this offering may occur at any time
after receipt by the Company of accepted subscriptions for the Minimum Offering
and the closing of the Share Exchange and thereafter, at any time, for closings
with respect to funds received by the Escrow Agent before the Termination Date.
The Securities subscribed for herein shall not be deemed issued to or owned by
me until one copy of this Subscription Agreement has been executed by me and
countersigned by the Company and the Closing with respect to such Securities has
occurred.
5. Disclosure. Because this offering is limited to accredited investors as
defined in Section 2(15) of the Securities Act of 1933, as amended (the
"Securities Act"), and Rule 501 promulgated thereunder, in reliance upon the
exemption contained in Sections 3(b) or 4(2) of the Securities Act and
applicable state securities laws, the Securities are being sold without
registration under the Securities Act. I acknowledge receipt of the Offering
Documents and all related documents and represent that I have carefully reviewed
and understand the Offering Documents. I have received all information and
materials regarding the Company that I have requested.
6. Investor Representations and Warranties. I acknowledge, represent and
warrant to, and agree with, the Company as follows:
(a) Accredited Investor Status. I am an "accredited investor" within the
meaning of Securities and Exchange Commission Rule 501 of Regulation
D.
(b) Purchase Entirely for Own Account. The Notes and Warrants will be
acquired by me for investment for my own account, not as a nominee or
agent, and not with a view to the resale or distribution of any part
thereof, and I have no present intention of selling, granting any
participation in, or otherwise distributing the same. I further
represent that I do not have any contract, undertaking, agreement or
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arrangement with any person to sell, transfer or grant participations
to such person or to any third person, with respect to the Securities.
(c) Disclosure of Information. I fully understand that the Securities are
speculative investments which involve a high degree of risk of the
loss of my entire investment. I represent that I have received the
disclosure I believe relevant and necessary to my investment decision
and have had an opportunity to ask questions and receive answers from
the Company regarding the terms and conditions of this transaction and
the business, properties, prospects and financial condition of the
Company and to obtain additional information (to the extent the
Company possessed such information or could acquire it without
unreasonable effort or expense) and/or conduct its own independent
investigation necessary to verify the accuracy of any information
furnished to me or to which I have had access. I have received no
representation or warranty from the Company or any of its officers,
directors, employees or agents in respect of my investment in the
Company and I have received no information (written or otherwise) from
it relating to the Company or its business other than as set forth in
the Offering Documents. I am not participating in the offer as a
result of or subsequent to: (i) any advertisement, article, notice or
other communication published in any newspaper, magazine or similar
media or broadcast over television or radio or (ii) any seminar or
meeting whose attendees have been invited by any general solicitation
or general advertising.
(d) Investment Experience. I (i) am experienced in evaluating and
investing in private placement transactions in securities of companies
similar to the Company and have such knowledge and experience in
financial or business matters that I am capable of evaluating the
merits and risks of the investment in the Securities and (ii)
acknowledge that I can bear the economic risk of my investment,
including the loss of the entire investment. I have been urged to seek
independent advice from my professional advisors relating to the
suitability of an investment in the Company in view of my overall
financial needs and with respect to the legal and tax implications of
such investment.
(e) Restricted Securities. I understand that the Securities are being sold
pursuant to exemptions from registration under Section 4(2) of the
Securities Act of 1933, as amended (the "Securities Act") and Rule 506
of Regulation D promulgated thereunder. I also understand that the
Securities and any securities issuable on exercise or conversion
thereof may not be resold by me without registration under the
Securities Act or an exemption therefrom, and that in the absence of
an effective registration statement covering the Securities or an
available exemption from registration under the Securities Act, the
Securities may be restricted from resale in a transaction to which
United States securities laws apply for an indefinite period of time.
(f) Illiquid Investment. I understand that no market for the Securities
exists and no such market may ever exist.
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(g) Operating History. I understand and acknowledge that the Company has a
limited operating history. The Company will use the proceeds of this
Offering to (i) develop its business and the relationships acquired
upon the consummation of the Share Exchange and (ii) pay the legal
fees and other costs related to the Share Exchange, all as described
in the Offering Documents.. An investor in the Company must consider
the risks, uncertainties, expenses, and difficulties frequently
encountered by companies in their early stages of development. The
Company makes no assurance that its business strategy will be
successful or that it will successfully address these risks or
difficulties.
(h) Need for Additional Financing. I acknowledge and agree that the
Company may, in the future, need to raise additional funds to expand
its concept and/or respond to business contingencies which may include
the need to: fund more rapid expansion; fund additional marketing
expenditures; enhance its operating infrastructure; hire additional
personnel; respond to competitive pressures; or acquire complementary
businesses or necessary technologies. If additional funds are raised
through the issuance of equity or convertible debt securities, the
percentage ownership of the Company's stockholders will be reduced,
and these newly-issued securities may have rights, preferences or
privileges senior to those of existing members, including those
acquiring Securities in this Offering. The Company makes no assurances
that additional financing will be available on terms favorable to it,
or at all. If adequate funds are not available or are not available on
acceptable terms, the Company's ability to fund operations, take
advantage of unanticipated opportunities, develop or enhance products
and services or otherwise respond to competitive pressures would be
significantly limited.
(i) Use of Proceeds. I acknowledge and agree that the Company will have
broad discretion with respect to the use of the net proceeds from this
Offering, and investors will be relying on the judgment of management
regarding the application of these proceeds. The Company has only made
preliminary determinations of the amount of net proceeds to be used
for specific purposes based upon current expectations regarding
financial performance and business needs over the foreseeable future.
These expectations may prove to be inaccurate, as the Company's
financial performance may differ from current expectations or business
needs may change as our business and industry evolve. As a result, the
proceeds received in this Offering may be used in a manner
significantly different from current plans. The Company makes no
assurances that the net proceeds will be used for purposes that
increase results of operations or the value of the Securities you
purchase in this Offering.
(j) Financial Projections. I acknowledge and agree that operating and
financial information contained in any of the Company's projected
financial data have been prepared by management and reflect its
current estimates of future performance. The projected results are
dependent on the successful implementation of management's growth
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strategies and are based on assumptions and events over which it has
only partial or no control. The assumptions underlying such projected
information require the exercise of judgment, and the projections are
subject to uncertainty due to the effects that economic, business,
competitive, legislative, political or other changes might have on
future events. Changes in the facts or circumstances underlying such
assumptions could materially affect the projections. To the extent
that assumed events do not materialize, actual results might vary
substantially from the projected results. As a result, the Company
might not achieve the operating or financial results set forth in
financial projections.
(k) Forward-looking statements. I acknowledge that I have not relied on
forward-looking statements contained in the Offering Documents because
they are inherently uncertain. Words as "anticipates," "believes,"
"plans," "expects," "future," "intends," and similar expressions are
used to identify these forward-looking statements. I have not placed
undue reliance on these forward-looking statements for many reasons,
including the risks faced by the Company described above and
elsewhere.
(l) Residence. I reside, or my office primarily responsible for the
purchase of the Securities is located, at the address listed on the
signature page.
(m) Brokers or Finders. All negotiations on the part of the Investor
relative to the transactions contemplated hereby have been carried on
by me without the intervention of any person or as the result of any
act of mine in such manner as to give rise to any valid claim for a
brokerage commission, finder's fee, or other like payment. The
foregoing notwithstanding, I acknowledge that vFinance Investments,
Inc. has been retained by the Company to serve as placement agent
("Placement Agent") in this offering, as in such capacity, will be
paid a commission equal to (i) 10% of the gross proceeds payable at
the First Closing and each additional Closing; (ii) 10% of the cash
held by the Company which will be available to the Company as a result
of the Share Exchange (as described in the Private Placement
Memorandum) payable at the First Closing; (iii) warrants equal to 10%
of the gross proceeds to the Company payable at the First Closing and
each additional Closing; and (iv) 420,000 warrants. All Placement
Agent warrants are exercisable at $1.00 per share, for a period of
five years from the Closing. The Company will also reimburse the
Placement Agent for its out-of-pocket expenses (including attorneys'
fees) incurred in connection with the offering.
(n) Reliance. I understand that this agreement is made with me in reliance
upon my representations to the Company, as set forth above.
(o) Cancellation Rights. I understand that except for any rescission
rights that may be provided under applicable laws, I am not entitled
to cancel, terminate or revoke this subscription, and any agreements
made in connection herewith shall survive my death or disability.
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7. Indemnification. I hereby agree to indemnify and hold harmless each of
the Company and Perf-Go Green, Inc. and each of its respective officers,
directors, stockholders, employees, agents, and counsel against any and all
losses, claims, demands, liabilities, and expenses (including reasonable legal
or other expenses, including reasonable attorneys' fees) incurred by each such
person in connection with defending or investigating any such claims or
liabilities, whether or not resulting in any liability to such person, to which
any such indemnified party may become subject under the Securities Act, under
any other statute, at common law or otherwise, insofar as such losses, claims,
demands, liabilities and expenses (a) arise out of or are based upon any untrue
statement or alleged untrue statement of a material fact made by me and
contained in this Subscription Agreement or my Investor Questionnaire, or (b)
arise out of or are based upon any breach by me of any representation, warranty,
or agreement made by me contained herein or therein.
8. Severability. In the event any parts of this Subscription Agreement are
found to be void, the remaining provisions of this Subscription Agreement shall
nevertheless be binding with the same effect as though the void parts were
deleted.
9. Choice of Law and Jurisdiction. This Subscription Agreement will be
deemed to have been made and delivered in New York County, State of New York and
will be governed as to validity, interpretation, construction, effect and in all
other respects by the internal laws of the State of New York. The Company and
the undersigned (i) agree that any legal suit, action or proceeding arising out
of or relating to this Subscription Agreement shall be instituted exclusively in
New York State Supreme Court, County of New York, or in the United States
District Court for the Southern District of New York, (ii) waive any proceeding,
and (iii) irrevocably consent to the jurisdiction of the New York State Supreme
Court, County of New York, and the United States District Court for the Southern
District of New York in any such suit, action or proceeding. The Company and the
undersigned further agree to accept and acknowledge service of any and all
process which may be served in any such suit action or proceeding brought in the
New York State Supreme Court, County of New York, or in the United States
District Court for the Southern District of New York and agree that service of
process upon it mailed by certified mail to its address shall be deemed in every
respect effective service of process upon it in any suit, action or proceeding.
10. Counterparts. This Subscription Agreement may be executed in one or
more counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument. The execution of this
Subscription Agreement may be by actual or facsimile signature or delivered via
other electronic means.
11. Benefit. This Subscription Agreement shall be binding upon and inure to
the benefit of the parties hereto.
12. Notices and Addresses. All notices, offers, acceptance and any other
acts under this Subscription Agreement (except payment) shall be in writing, and
shall be sufficiently given if delivered to the addresses in person, by Federal
Express or similar courier delivery or by facsimile delivery, as follows:
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Investor: At the address designated on the signature
page of this Subscription Agreement.
Placement Agent: vFinance Investments, Inc.
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxxxx Xxxx
Fax: (000) 000-0000
Company: ESYS Holdings, Inc.
0000 Xxxxxxxx Xxxxxxx Xxxxx
Xxxxxx Xxxx, XX 00000
with a copy to: Xxxxxx & Xxxxxx, LLP
000 Xxxxx 0 Xxxxx, Xxxxx 000
Xxxxxxxxx, Xxx Xxxxxx 00000
Tel: (000) 000-0000
Attention: Xxxx X. Xxxxx, Esq..
or to such other address as any of them, by notice to the others may designate
from time to time. The transmission confirmation receipt from the sender's
facsimile machine shall be conclusive evidence of successful facsimile delivery.
Time shall be counted to, or from, as the case may be, the delivery in person or
by mailing.
13. Entire Agreement. This Subscription Agreement constitutes the entire
agreement between the parties with respect to the subject matter hereof and
supersedes all prior oral and written agreements between the parties hereto with
respect to the subject matter hereof. This Subscription Agreement may not be
changed, waived, discharged, or terminated orally but, rather, only by a
statement in writing signed by the party or parties against which enforcement or
the change, waiver, discharge or termination is sought.
14. Section Headings. Section headings herein have been inserted for
reference only and shall not be deemed to limit or otherwise affect, in any
matter, or be deemed to interpret in whole or in part, any of the terms or
provisions of this Subscription Agreement.
15. Survival of Representations, Warranties and Agreements. The
representations, warranties and agreements contained herein shall survive the
delivery of, and the payment for, the Securities.
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16. Acceptance of Subscription. The Company may accept this Subscription
Agreement at any time for all or any portion of the Securities subscribed for by
executing a copy hereof as provided and notifying me within a reasonable time
thereafter.
RESIDENTS OF ALL STATES: THE SECURITIES OFFERED HEREBY HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY
STATE OR OTHER JURISDICTION AND ARE BEING OFFERED AND SOLD IN RELIANCE ON
EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF SAID ACT AND SUCH LAWS. THE
SECURITIES ARE SUBJECT TO REGISTRATIONS ON TRANSFERABILITY AND RESALE AND MAY
NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER SAID ACT AND SUCH LAWS
PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM. INVESTORS SHOULD BE AWARE THAT
THEY WILL BE REQUIRED TO BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN
INDEFINITE PERIOD OF TIME. THE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED
BY THE SECURITIES AND EXCHANGE COMMISSION, ANY STATE SECURITIES COMMISSION OR
OTHER REGULATORY AUTHORITY, NOR HAVE ANY OF THE FOREGOING AUTHORITIES PASSED
UPON OR ENDORSED THE MERITS OF THIS OFFERING OR THE ACCURACY OR ADEQUACY OF THIS
CONFIDENTIAL INVESTMENT SUMMARY. ANY REPRESENTATION TO THE CONTRARY IS UNLAWFUL.
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Xxxxxx in Which Title is to be Held. (check one)
___ Individual Ownership
___ Community Property
___ Joint Tenant with Right of Survivorship (both parties must sign)
___ Partnership
___ Tenants in common
___ Corporation
___ Trust
___ IRA or Xxxxxx
___ Other (please indicate)
Dated: ____________
INDIVIDUAL INVESTORS ENTITY INVESTORS
Name of entity, if any __________________
---------------------------------
Signature (Individual)
By:
--------------------------------------
*Signature
Its
---------------------------------- --------------------------------------
Signature (Joint) Title
(all record holders must sign)
---------------------------------- ----------------------------------------
Name(s) Typed or Printed Name Typed or Printed
Address to Which Correspondence Address to Which Correspondence
Should be Directed Should be Directed
---------------------------------- ----------------------------------------
---------------------------------- ----------------------------------------
City, State and Zip Code City, State and Zip Code
---------------------------------- -----------------------------------------
Tax Identification or Tax Identification or
Social Security Number Social Security Number
* If Securities are being subscribed for by any entity, the Certificate
of Signatory on the next page must also be completed
The foregoing subscription is accepted and the Company hereby agrees to be bound
by its terms.
ESYS HOLDINGS, INC.
Dated: _____, 2008 By:
-----------------------------------
Name:______________________________
Title:_______________________________
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CERTIFICATE OF SIGNATORY
(To be completed if Securities are being subscribed for by an entity)
I, ____________________________________, the ______________________________
(name of signatory) (title)
of __________________________ (the"Entity"), a_____________________________
(type of entity)
hereby certify that I am empowered and duly authorized by the Entity to execute
the Subscription Agreement and to purchase the Securities, and certify further
that the Subscription Agreement has been duly and validly executed on behalf of
the Entity and constitutes a legal and binding obligation of the Entity.
IN WITNESS WHEREOF, I have set my hand this day of , 2008.
-----------------------------
(Signature)
------------------------------
(Print Name)
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Exhibit A
Form of Debenture
See Attached.
Exhibit B
Form of Warrant
See Attached.
Exhibit C
Form of Security Agreement
See Attached.
Exhibit D
Form of Registration Rights Agreement
See Attached.
