EXHIBIT 10.4
SUBSCRIPTION AGREEMENT
December __, 2003
CENUCO, INC.
0000 XXXXXXXX XXX
XXXX XXXXX, XX 00000
Dear Sirs:
1.1 SUBSCRIPTION. I, the undersigned investor (the "Investor"), hereby
subscribes for and agree to purchase one Unit consisting of 100,000 shares of
common stock and warrants to purchase an additional 100,000 shares of common
stock on the terms and conditions contained herein (the "unit:)". The warrants
shall be exercisable over a five-year period at $1.00 per share, contain
standard anti-dilution provisions providing for adjustment in the event of
events such as stock splits, stock dividends and recapitalizations including
reverse stock splits.
1.2 SUBSCRIPTION PAYMENT. As payment for this subscription,
simultaneously with the execution hereof, I am delivering herewith to the
Company a check made payable to the order of "Cenuco Inc." in the amount of
$100,000.
2.1 INVESTOR REPRESENTATIONS AND WARRANTIES. I acknowledge, represent
and warrant to, and agree with, the Company as follows:
(a) I am aware that my investment involves a high degree of
risk;
(b) I acknowledge and am aware that there is no assurance as
to the future performance of the Company;
(c) I am purchasing the Unit for my own account for investment
and not with a view to or for sale in connection with the distribution
of the Unit nor with any present intention of selling or otherwise
disposing of all or any part of the Unit. I agree that I must bear the
economic risk of my investment for an indefinite period of time
because, among other reasons, neither the common stock nor the common
stock underlying the warrants have been registered under the Securities
Act of 1933 (the "Securities Act") or under the securities laws of any
states and, therefore, cannot be resold, pledged, assigned or otherwise
disposed of unless they are subsequently registered under the
Securities Act and under applicable securities laws of such states or
an exemption from such registration is available. I hereby authorize
the Company to place a legend denoting the restriction on the
securities contained in the Units to be issued. I acknowledge that no
public market will ever develop for the warrants.
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(d) I further acknowledge my understanding that the Company's
reliance on such exemptions referred to in Section 2.1(c) above are, in
part, based upon the foregoing representations, warranties, and
agreements by me and that the statutory basis for such exemptions would
not be present, if notwithstanding such representations, warranties and
agreements, I were acquiring the Unit for resale on the occurrence or
non-occurrence of some pre-determined event. In order to induce the
Company to issue and sell the Unit subscribed for hereby to me, it is
agreed that the Company will have no obligation to recognize the
ownership, beneficial or otherwise, of such Unit or any part thereof by
anyone, except as set forth herein;
(e) I have the financial ability to bear the economic risk of
my investment in the Company (including its possible total loss), have
adequate means for providing for my current needs and personal
contingencies and have no need for liquidity with respect to my
investment in the Company;
(f) I, alone or together with my Purchaser Representative have
such knowledge and experience in financial and business matters as to
be capable of evaluating the merits and risks of an investment in the
Unit and have obtained, in my judgment, sufficient information from the
Company to evaluate the merits and risks of an investment in the
Company;
(g) I:
(1) Have carefully read this Subscription Agreement ,
understand and have evaluated the risks of a purchase of the
Unit and have relied solely (except as indicated in subsection
(2), (3) and (4) below) on the information contained in the
this Subscription Agreement;
(2) Have been provided company 10Q, 10K and all other
requested information and an opportunity to obtain any
additional information concerning the offering, the Company
and all other information to the extent the Company possesses
such information or can acquire it without unreasonable effort
or expense; and
(3) Have been given the opportunity to ask questions
of, and receive answers from, the Company concerning the terms
and conditions of the offering and other matters pertaining to
this investment. In addition, as required by Section
517.061(11)(a)(3), Florida Statutes and by Rule 3E-500.05(a)
thereunder, I may have, at the offices of the Company, at any
reasonable hour, after reasonable prior notice, access to the
materials set forth in the Rule which the Company can obtain
without unreasonable effort or expense.
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(h) In making my decision to purchase the Unit herein
subscribed for, I have relied solely upon independent investigations
made by me;
(i) If the undersigned is a corporation, trust, partnership,
employee benefit plan, individual retirement account, Xxxxx Plan, or
other tax-exempt entity, it is authorized and qualified to become an
investor in the Company and the person signing this Subscription
Agreement on behalf of such entity has been duly authorized by such
entity to do so;
(j) The information contained in Section 2.2 of this
Subscription Agreement is true and correct including any information
which I have furnished and furnish to the Company with respect to my
financial position and business experience, is correct and complete as
of the date of this Subscription Agreement and if there should be any
material change in such information prior to acceptance of my
subscription, I will furnish such revised or corrected information to
the Company;
(k) I hereby acknowledge and am aware that except for any
rescission rights that may be provided under applicable state laws
including the three day rights under Florida law, I am not entitled to
cancel, terminate or revoke this subscription, and any agreements made
in connection herewith shall survive my death or disability;
(m) I have not received any general solicitation or
advertising regarding the purchase of the Unit; and
(o) Where applicable, I agree to be bound by any restrictions
on resale of the Unit required by applicable state laws.
2.2 INVESTOR REPRESENTATIONS AND WARRANTIES CONCERNING SUITABILITY,
ACCREDITED INVESTOR AND ELIGIBLE CLIENT STATUS. I represent and warrant the
following information:
(a) The following information should be provided by the person
making the investment decision whether on his own behalf or on behalf
of an entity:
(1) Name of Investor: _____________________________ Age: _____
(2) Name of person making investment decision
_______________________________________________ Age: _____
(Print)
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(3) Principal residence address and telephone number:
__________________________________________________________
__________________________________________________________
(4) Secondary residence address and telephone number:
__________________________________________________________
__________________________________________________________
__________________________________________________________
I have no present intention of becoming a resident of any
other state or jurisdiction.
(5) Name, address, telephone number and facsimile number of
employer or business:
__________________________________________________________
__________________________________________________________
__________________________________________________________
(i) Nature of business ______________________________
(ii) Position and nature of responsibilities
________________________________________________
(6) Length of employment or in current position ______________
(7) Prior employment, positions or occupations during the past
five years (and the inclusive dates of each) are as
follows:
Nature of Employment,
or Occupation Position/ Duties From/To
--------------------- ---------------- -------
__________________________________________________________
__________________________________________________________
__________________________________________________________
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Attach additional pages to answer any questions in greater
detail, if necessary. Each prospective investor, should
answer the following questions which pertain to income,
tax rate, net worth, liquid assets, and non-liquid assets
by including spousal contribution even though the
investment will be held in single name.
(8) Business or professional education and the degree(s)
received are as follows:
School Degree Year Received
------ ------ -------------
__________________________________________________________
__________________________________________________________
__________________________________________________________
(b) ACCREDITED INVESTOR REPRESENTATIONS. MUST INITIAL ONE.
Initial all appropriate spaces on the following pages indicating the
basis upon which the undersigned qualifies as an accredited investor
(please initial only where appropriate).
For Individual Investors Only:
(1) ___ I certify that I am an accredited investor because I have an
individual net worth, or my spouse and I have combined net worth, in
excess of $1,000,000. For purposes of this question, "net worth" means
the excess of total assets at fair market value, including home, home
furnishings and automobiles, over total liabilities.
(2a) ___ I certify that I am an accredited investor because I had
individual income (exclusive of any income attributable to my spouse)
of more than $200,000 in 2001 and 2002 and I reasonably expect to have
an individual income in excess of $200,000 in 2003.
(2b) ___ Alternatively, my spouse and I have joint income in excess of
$300,000 in each applicable year.
(3) ___ I am a director or executive officer of the Company.
Other Investors:
(4) ___ The undersigned certifies that it is one of the following: any
bank as defined in Section 3(a)(2) 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; insurance company as defined in Section 2(13) of
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the Securities Act; 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; 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 plan
established and maintained by a state, its political subdivisions, or
any agency or instrumentality of a state or its political subdivisions,
for the benefit of its employees, if such plan has total assets in
excess of $5,000,000; employee benefit plan within the meaning of Title
I 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.
(5) ___ The undersigned certifies that it is a private business
development company as defined in Section 202(a)(22) of the Investment
Advisors Act of 1940.
(6) ___ The undersigned certifies that it is a 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.
(7) ___ The undersigned certifies that it is a 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 Rule 506(b)(2)(ii) of the
Securities Act.
(8) ___ The undersigned certifies that it is an entity in which all of
the equity owners are accredited investors.
2.3 REGISTRATION RIGHTS. The company will use its best efforts to
register the issued stock within the company's next registration.
3. INDEMNIFICATION. I hereby agree to indemnify and hold harmless the
Company, its officers, directors, shareholders, employees, agents and attorneys
against any and all losses, claims, demands, liabilities and expenses (including
reasonable legal or other expenses) 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 (b) arise out of or are based upon any breach of any
representation, warranty or agreement contained herein.
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4. ARBITRATION. Any controversy, dispute or claim against the Company,
its officers, directors or employees arising out of or relating to this
Subscription Agreement, or its interpretation, application, implementation,
breach or enforcement which the parties are unable to resolve by mutual
agreement, shall be settled by submission by either party of the controversy,
claim or dispute to binding arbitration in Palm Beach County, Florida (unless
the parties agree in writing to a different location) before one arbitrator in
accordance with the rules of the American Arbitration Association then in
effect. In any such arbitration proceeding, the parties agree to provide all
discovery deemed necessary by the arbitrator. The decision and award made by the
arbitrator shall be final, binding and conclusive on all parties to any
arbitration proceeding for all purposes, and judgment may be entered thereon in
any court having jurisdiction thereof.
5. 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.
6. 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.
7. BENEFIT. This Subscription Agreement shall be binding upon and inure
to the benefit of the parties hereto and their legal representatives, successors
and assigns.
8. 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 addressees in person, by Federal
Express or similar receipted delivery, by facsimile delivery or, if mailed,
postage prepaid, by certified mail, return receipt requested, as follows:
Investor: At the address designated in Section 2.2 of this
Subscription Agreement
The Company: At the address on page 1 of this Subscription Agreement
or to such other address as either of them, by notice to the other may designate
from time to time. The transmission confirmation receipt from the sender's
facsimile machine shall be evidence of successful facsimile delivery. Time shall
be counted to, or from, as the case may be, the delivery in person or by
mailing.
9. GOVERNING LAW. This Subscription Agreement and any dispute,
disagreement, or issue of construction or interpretation arising hereunder
whether relating to its execution, its validity, the obligations provided
therein or performance shall be governed or interpreted according to the laws of
the State of Florida.
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10. ORAL EVIDENCE. This Subscription Agreement constitutes the entire
Subscription Agreement between the parties and supersedes all prior oral and
written agreements between the parties hereto with respect to the subject matter
hereof. Neither this Subscription Agreement nor any provision hereof may be
changed, waived, discharged or terminated orally, except by a statement in
writing signed by the party or parties against which enforcement or the change,
waiver discharge or termination is sought.
11. 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.
12. SURVIVAL OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS. The
representations, warranties and agreements contained herein shall survive the
delivery of, and payment for, the Unit.
13. ACCEPTANCE OF SUBSCRIPTION. The Company may accept this
Subscription Agreement at any time for all or any portion of the Unit subscribed
for by executing a copy hereof as provided and notifying me within a reasonable
time thereafter.
FLORIDA LAW PROVIDES THAT WHEN SALES ARE MADE TO FIVE OR MORE PERSONS IN
FLORIDA, ANY SALE MADE IN FLORIDA IS VOIDABLE BY THE PURCHASER WITHIN THREE DAYS
AFTER THE FIRST TENDER OF CONSIDERATION IS MADE BY SUCH PURCHASER TO THE
COMPANY, AN AGENT OF THE COMPANY OR AN ESCROW AGENT OR WITHIN THREE DAYS AFTER
THE AVAILABILITY OF THAT PRIVILEGE IS COMMUNICATED TO SUCH PURCHASER, WHICHEVER
OCCURS LATER. THIS SALE IS BEING MADE IN FLORIDA. PAYMENTS FOR TERMINATED
SUBSCRIPTIONS VOIDED BY PURCHASERS AS PROVIDED FOR IN THIS PARAGRAPH WILL BE
PROMPTLY REFUNDED WITHOUT INTEREST. NOTICE SHOULD BE GIVEN TO THE COMPANY TO THE
ATTENTION OF XXXXXX XXXXXXXXX AT THE ADDRESS SET FORTH ON THE COVER PAGE OF THIS
SUBSCRIPTION AGREEMENT.
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INDIVIDUAL INVESTORS
______________________ ____________________________
Social Security Number Print Name of Investor No. 1
____________________________
Signature of Investor No. 1
______________________ ____________________________
Social Security Number Print Name of Investor No. 2
____________________________
Signature of Investor No. 2
Manner in which Unit is to be held:
_____ Individual Ownership _____ Partnership
_____ Tenants-in-Common _____ Trust
_____ Joint Tenant With Right of Survivorship _____ Corporation
_____ Community Property _____ Employee Benefit Plan
_____ Separate Property _____ Other (please indicate)
CORPORATE OR OTHER ENTITY
_________________ _______________________
Federal ID Number Print Name of Entity
By: _______________________
Signature, Title
DATED: _______________, 2003
By signing below, the undersigned accepts the foregoing subscription
and agrees to be bound by its terms.
Cenuco, Inc.
By: ___________________________ Dated: December __, 2003
Xxxxxx Xxxxxxxxx, President
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