RESIDENTS OF THE STATE OF FLORIDA WHO PURCHASE THE SHARES HAVE THE
RIGHT, PURSUANT TO SECTION 517.061(11)(a)5 OF THE FLORIDA SECURITIES
AND INVESTOR PROTECTION ACT, TO WITHDRAW THEIR SUBSCRIPTIONS AND
RECEIVE A FULL REFUND OF ALL MONIES PAID WITHIN THREE DAYS AFTER
RECEIPT OF THIS MEMORANDUM OR WITHIN THREE DAYS AFTER THE FIRST PAYMENT
OF MONEY OR OTHER CONSIDERATION TO THE COMPANY, WHICHEVER OCCURS LATER.
SUBSCRIPTION AGREEMENT
As of September 12, 1996
Sandata, Inc.
00 Xxxxxx Xxxx Xxxxx
Xxxx Xxxxxxxxxx, XX 00000
Ladies and Gentlemen:
1. Offer to Purchase. Subject to the terms and conditions set forth in this
Subscription Agreement (the "Agreement"), ____________________ (the "Purchaser")
hereby subscribes for the purchase of _________ shares (the "Shares") of common
stock, $.001 par value per share ("Common Stock"), of Sandata, Inc., a Delaware
corporation (the "Company"), at a price of $3.00 per share, which in the
aggregate totals $_________. The purchase price is payable by unendorsed
certified check made payable to the order of or wire transfer to Sandata, Inc.,
contemporaneously herewith.
2. Representations, Warranties and Agreements of Purchaser. In connection
with its subscription, the Purchaser hereby makes the following representations,
warranties and agreements and confirms the following understandings to the
Company:
(a) Investment Purpose. The Purchaser is acquiring the Shares for
his own account and for investment purposes only, within the meaning
of the Securities Act of 1933, as amended (the "Securities Act"), and
applicable state securities laws, with no intention of assigning any
participation or interest therein and with no view to the distribution
or resale thereof.
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(b) Review and Evaluation of Information Regarding the Company.
Purchaser is familiar with the Company's operations and financial
condition. He acknowledges that he has had the opportunity to ask
representatives of the Company questions about the Company's business
and financial condition and that he has obtained and reviewed such
information as he has requested to the extent he has deemed necessary
to permit him to fully evaluate the merits and risks of his investment
in the Company.
(c) Purchaser's Financial Experience. The Purchaser is
sufficiently experienced in financial and business matters to be
capable of evaluating the merits and risks of an investment in the
Company.
(d) Suitability of Investment. The Purchaser has evaluated the
merits and risks of the Purchaser's proposed investment in the
Company, including those risks particular to the Purchaser's
situation, and has determined that this investment is suitable for
him. The Purchaser has adequate financial resources for an investment
of this character, and at this time the Purchaser can bear a complete
loss of his investment.
(e) Limitations on Disposition. Purchaser will not sell, assign,
transfer, encumber or otherwise dispose of any of the Shares unless
(i) a registration statement under the Securities Act with respect
thereto is in effect and the prospectus included therein meets the
requirements of Section 10 of the Securities Act, or (ii) the Company
has received a written opinion of its counsel that, after an
investigation of the relevant facts, such counsel is of the opinion
that such proposed sale, assignment, transfer, encumbrance or
disposition does not require registration under the Securities Act.
The Purchaser understands that the Shares are not being registered
under the Securities Act and must be held indefinitely unless they are
subsequently registered thereunder or an exemption from such
registration is available. The Purchaser understands that there are
substantial restrictions on the transferability of the Shares. The
Purchaser may not be able to avail himself of certain of the
provisions of Rule 144 adopted by the Securities and Exchange
Commission ("Commission") under the Securities Act with respect to the
public resale of the Shares; and accordingly, the Purchaser may have
to hold the Shares for an indefinite period of time and the Purchaser
may not be able to liquidate his investment in the Company. The
Purchaser represents that he can afford to hold the Shares for an
indefinite period of time.
(f) Accredited Investor. The Purchaser has reviewed the Company's
Annual Report on Form 10-KSB for the fiscal year ended May 31, 1996
(the "Form 10-KSB"). The Purchaser (i) is either an "accredited
investor," as such term is defined in Rule 501(a) promulgated by the
Commission under the Securities Act, or has such knowledge and
experience in financial and business matters that he is capable of
evaluating the merits and risks of the acquisition of the Shares
contemplated hereby; (ii) the Purchaser is able to bear the economic
risks of investment in the Shares, including, without limitation, the
risk of the loss of part or all of his investment and the inability to
sell or transfer the Shares for an indefinite period of time; (iii)
the Purchaser has adequate means of providing for current needs and
contingencies and has no need for liquidity in his investment in the
Shares; and (iv) the Purchaser does not have an overall
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commitment to investments which are not readily marketable that
is excessive in proportion to his net worth and an investment in the
Shares will not cause such overall commitment to become excessive. The
Purchaser will execute and deliver to the Company such documents as
the Company may reasonably request in order to confirm the accuracy of
the foregoing.
(g) Reliance on Representations. The Purchaser understands that
the Shares are not being registered under the Securities Act in part
on the ground that the issuance thereof is exempt under Section 4(2)
of the Securities Act, as a transaction by an issuer not involving any
public offering and that the Company's reliance on such exemption is
predicated in part on the foregoing representations and warranties of
the Purchaser.
(h) Restrictive Legend. The Shares to be issued to Purchaser may
not be sold, assigned, transferred, encumbered or disposed of unless
they are registered under the Securities Act and applicable state
securities laws or unless an exemption from such registration is
available. Accordingly, the following restrictive legend will be
placed on any instrument, certificate or other document evidencing the
Shares.
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR
ANY STATE SECURITIES LAWS. THESE SHARES HAVE BEEN ACQUIRED FOR
INVESTMENT AND NOT FOR DISTRIBUTION OR RESALE. THEY MAY NOT BE
SOLD, ASSIGNED, MORTGAGED, PLEDGED, HYPOTHECATED OR OTHERWISE
TRANSFERRED OR DISPOSED OF WITHOUT AN EFFECTIVE REGISTRATION
STATEMENT FOR SUCH SHARES UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, AND APPLICABLE STATE SECURITIES LAWS OR AN OPINION OF
COUNSEL FOR THE COMPANY THAT REGISTRATION IS NOT REQUIRED
UNDER SUCH ACT.
(i) Certain Risk Factors. Purchaser acknowledges that there are
significant risks relating to the acquisition of the Shares including,
without limitation, the risks referred to in the Company's Form
10-KSB.
(j) Absence of Official Evaluation. The Purchaser understands
that neither the Commission nor any other federal or state agency has
made any finding or determination as to the fairness of the terms of
an investment in the Company, nor any recommendation or endorsement of
the Shares offered hereby.
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(k) Obligation. This Agreement constitutes a valid and legally
binding obligation of the Purchaser and neither the execution and
delivery of this Agreement, nor the consummation of the transactions
contemplated hereby, will constitute a violation of or default under,
or conflict with, any judgment, decree, statute or regulation of any
governmental authority applicable to the Purchaser or violate, alone
or with notice or the passage of time or both, result in a material
breach or termination or otherwise give any contracting party the
right to terminate or declare a default under any contract,
commitment, agreement or restriction of any kind to which the
Purchaser is a party or by which he or his assets are bound. The
execution and delivery of this Agreement does not, and the
consummation of the transactions described herein will not, violate
applicable law, or any mortgage, lien, agreement, indenture, lease or
understanding (whether oral or written) of any kind outstanding
relative to the Purchaser.
(l) Approvals Required. No approval, authorization, consent,
order or other action of, or filing with, any person, firm or
corporation or any court, administrative agency or other governmental
authority is required in connection with the execution and delivery of
this Agreement by the Purchaser or the consummation of the
transactions described herein, and, except to the extent that the
Purchaser or the Company is required to file reports in accordance
with relevant regulations under Federal securities laws all of which
reports have been or will be timely made by the Purchaser.
3. Representations, Warranties and Agreements of the Company. In connection
with this subscription, the Company makes the following representations,
warranties and agreements and confirms the following understanding:
(a) No Pending Proceedings. Except as disclosed in the Form 10-KSB,
there is not now pending or, to the Company's knowledge, threatened
against the Company, any of its subsidiaries or affiliates nor any of
their respective directors or officers (in their capacity as directors
or officers) any action or proceeding of which it has been advised,
either in any court of competent jurisdiction or before the
Commission, or regulatory authority.
(b) No Material Adverse Changes. Since the date of the Form
10-KSB, no facts have come to our attention which would cause us to
believe that the Form 10-KSB includes an untrue statement of a
material fact or omits to state a material fact required to be stated
therein or necessary in order to make the statements therein, in light
of the circumstances in which they were made, not misleading.
(c) Company's Good Standing. The Company is a corporation duly
organized, validly existing and in good standing under the laws of the
State of Delaware and is qualified to do business in all jurisdictions
in which it is required to be qualified to do business, and has all
necessary powers to carry on its business as now operated by it.
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(d) Capitalization. The Company has 763,955 shares of Common
Stock outstanding, and options and warrants to purchase 1,225,259
shares of Common Stock outstanding. No shares of the Common Stock are
held by it as treasury shares; all of the outstanding shares of the
Common Stock are validly issued, fully paid and non-assessable; none
of the shares of the Common Stock have been issued in violation of the
preemptive rights of any person. Except as described in the Form
10-KSB, there is not outstanding any security, option, warrant, right,
instrument convertible into or exchangeable for, employee benefit plan
or arrangement, agreement, understanding or commitment of any kind
entitling any person, corporation or entity to purchase, subscribe for
or otherwise acquire, or relating to the voting of, any shares of
capital stock or other equity interests of the Company.
(e) Legal and Other Proceedings. Neither the Company, nor any of
its subsidiaries or affiliates or each of their respective directors
or officers (in their capacity as directors or officers), is a party
to any pending or, to the best knowledge of the Company, threatened,
claim, action, suit, investigation, arbitration or proceeding, or is
subject to any order, judgment or decree that is reasonably expected
to have, either individually or in the aggregate, a material adverse
effect on the condition (financial or otherwise), earnings or results
of operations of the Company. The Company is not, as of the date
hereof, a party to or subject to any enforcement action instituted by,
or any agreement or memorandum of understanding with, any federal or
state regulatory authority restricting its operations or requiring
that actions be taken, and no such regulatory authority has threatened
any such action, memorandum or order against the Company and the
Company has not received any report of examination from any federal or
state regulatory agency which requires that the Company address any
problem or take any action which has not already been addressed or
taken in a manner satisfactory to the regulatory agency.
(f) Compliance with Laws. The Company represents and warrants
that, to the best of its knowledge, the Company:
(1) is in compliance in all material respects with
all laws, regulations, reporting and licensing requirements
and orders applicable to its business or any of its employees
(because of any such employee's activities on the Company's
behalf);
(2) is in compliance in all material respects with
all federal, state and local employment laws and regulations
(including employment discrimination laws and regulations)
applicable to its business or any of its employees; and
(3) has received no notification from any agency or
department of federal, state or local government or any
regulatory authority or the staff thereof asserting that it is
not in material compliance with or has violated any of the
statutes, regulations or ordinances which such governmental
authority or regulatory authority enforces, or threatening to
revoke any license, franchise, permit or governmental
authorization, and is subject to no material agreement or
consent
CORP\02437\0068\LCF04.03B
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decree with any regulatory authorities arising out of
previously asserted violations with respect to its assets or
business.
(g) Financial Statements. The financial statements included in
the Form 10-KSB (the "Financial Statements"), as of the dates thereof
and for the periods covered thereby, are in accordance with the books
and records of the Company, which books and records are complete and
correct in all material respects required by generally accepted
accounting principles ("GAAP") and present fairly, in all material
respects, the financial position and results of the Company in
accordance with GAAP applied on a basis consistent with prior periods.
(h) Tax Matters. All federal, state, local and foreign tax
returns (including, without limitation, estimated tax returns, and,
with respect to employees, FICA and FUTA returns) required to be filed
by or on behalf of the Company have been timely filed, or requests for
extensions have been timely filed, granted and have not expired, and
all returns filed are complete and accurate in all material respects.
All taxes shown on filed returns have been paid. As of the date
hereof, there is no deficiency or refund litigation, matter in
controversy, or audit examination with respect to any taxes that might
result in a determination adverse to the Company, except as reserved
in the Financial Statements. All taxes, interest, additions and
penalties due with respect to completed and settled examinations or
concluded litigation have been paid. The Company has not executed an
extension or waiver of any statute of limitations on the assessment or
collection of any tax due that is currently in effect. To the extent
any federal, state, local or foreign taxes are due from or, for any
periods through and including December 31, 1996, adequate provision
has been made for the payment of such taxes by establishing
appropriate liability accounts on the Financial Statements.
(i) Obligation. This Agreement constitutes a valid and legally
binding obligation of the Company and neither the execution and
delivery of this Agreement, nor the consummation of the transactions
contemplated hereby, will constitute a violation of or default under,
or conflict with, any judgment, decree, statute or regulation of any
governmental authority applicable to the Company or violate, alone or
with notice or the passage of time or both, results in a material
breach or termination or otherwise give any contracting party the
right to terminate or declare a default under any contract,
commitment, agreement or restriction of any kind to which the Company
is a party or by which its assets are bound. The execution and
delivery of this Agreement does not, and the consummation of the
transactions described herein will not, violate applicable law, or any
mortgage, lien, agreement, indenture, lease or understanding (whether
oral or written) of any kind outstanding relative to the Company.
(j) Approvals Required. No approval, authorization, consent,
order or other action of, or filing with, any person, firm or
corporation or any court, administrative agency or other governmental
authority is required in connection with the execution and delivery of
this Agreement by the Company or the consummation of the transactions
described herein, and, except to the extent that the Purchaser or the
Company is required to file reports in accordance with
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relevant regulations under Federal securities laws all of which
reports have been or will be timely made by the Company.
4. Registration Rights. If at any time during the three (3) years
after the date hereof, the Company shall prepare and file one or more
registration statements under the Securities Act (other than a registration
statement on Form S-4 (or with regard to any transaction contemplated by Rule
145, promulgated under the Securities Act) or Form S-8 or any successor form of
limited purpose and other than a post-effective amendment to any registration
statement), to the extent permitted by law, including, without limitation, the
rules and regulations of the Commission, with respect to a public offering of
equity or debt securities of the Company, or of any such securities of the
Company held by its security holders, the Company will, to the extent permitted
by law, including without limitation, the rules and regulations of the
Commission, include in any such registration statement such information as is
required, and such number of Shares held by the Purchaser or his respective
designees or transferees (the "Purchasers") as may be requested by them, to
permit a public offering of the Shares so requested; provided, however, that if,
in the written opinion of the Company's managing underwriter, if any, for such
offering, the inclusion of the Shares requested to be registered, when added to
the securities being registered by the Company or the selling security
holder(s), would exceed the maximum amount of the Company's securities that can
be marketed without otherwise materially and adversely affecting the entire
offering, then the Company may exclude from such offering all or that portion of
the Shares requested to be so registered, so that the total number of securities
to be registered is within the maximum number of shares that, in the opinion of
the managing underwriter, may be marketed without otherwise materially and
adversely affecting the entire offering, provided that at least a pro rata
amount of the securities that otherwise were proposed to be registered for other
stockholders is also excluded. In the event of such a proposed registration, the
Company shall furnish the then Purchasers with not less than twenty (20) days'
written notice prior to the proposed date of filing of such registration
statement. Further notice shall be given by the Company to Purchasers, with
respect to subsequent registration statements or post-effective amendments filed
by the Company, until such time as all of the Shares have been registered or may
be sold without registration under the Securities Act or applicable state
securities laws and regulations pursuant to Rule 144 of the Securities Act. The
Purchaser shall exercise the rights provided for in this Section by giving
written notice to the Company, within ten (10) days of receipt of the Company's
notice of its intention to file a registration statement. Notwithstanding
anything contained herein to the contrary, the Purchaser shall not be permitted
to exercise the registration rights provided for herein with respect to all or
such portion of the Shares as may be sold without registration under the
Securities Act or applicable state securities laws and regulations under Rule
144 of the Securities Act.
The Company shall bear all expenses, incurred in the preparation and
filing of such registration statements or post-effective amendment (and related
state registrations, to the extent permitted by applicable law) and the
furnishing of copies of the preliminary and final prospectus thereof to the
Purchaser, other than expenses of the Purchaser's counsel, and other than sales
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commissions or transfer taxes incurred by the Purchasers with respect to the
sale of such securities.
The Purchaser whose Shares are included in a registration statement
pursuant to an underwritten public offering shall, if requested by the managing
underwriter of the public offering, enter into an agreement with the underwriter
pursuant to which the Purchaser will agree not to sell, transfer or otherwise
dispose of the Shares for such period after consummation of the public offering
as may reasonably be requested by the underwriter; up to a maximum of ninety
(90) days, without the consent of the underwriter.
Notwithstanding anything contained herein to the contrary, prior to the
effectiveness of a registration statement pursuant to which the Purchaser has
requested registration of his Shares pursuant to this Agreement, the Company may
delay the effectiveness of such registration statement or withdraw the
registration statement.
Notwithstanding anything contained herein to the contrary, if at any
time during which the Company is obligated to maintain the effectiveness of a
registration statement, counsel to the Company (which counsel shall be
experienced in securities matters) has determined in good faith that the filing
of such registration statement or the compliance by the Company with its
disclosure obligations thereunder would require the disclosure of material
information which the Company has a bona fide business purpose for preserving as
confidential, then the Company may delay the filing or the effectiveness of such
registration statement (if not then filed or effective, as appropriate) and
shall not be required to maintain the effectiveness thereof (if previously
declared effective) for a period expiring upon the earlier to occur of (i) the
date on which such information is disclosed to the public or ceases to be
material or the Company is so able to comply with its disclosure obligations, or
(ii) thirty (30) days after counsel to the Company makes such good faith
determination. There shall not be more than one such delay period with respect
to any registration statement after it has been declared effective pursuant to
this Section. Notice of any such delay period and of the termination thereof
will be promptly delivered by the Company to each Purchaser and shall be
maintained in confidence by each such Purchaser. The Purchaser shall not sell
any Shares during such period as any such registration statement is not current,
as advised by the Company. Each Purchaser shall furnish to the Company such
information regarding such Purchaser and a written description of the
distribution proposed by such Purchaser as the Company may reasonably request.
5. Miscellaneous.
(a) Entire Agreement. This Agreement constitutes the entire
agreement between the parties hereto with respect to the subject
matter hereof. This Agreement supersedes all prior negotiations,
letters and understandings relating to the subject matter hereof.
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(b) Amendment. This Agreement may not be amended, supplemented or
modified in whole or in part except by an instrument in writing signed
by the party or parties against whom enforcement of any such
amendment, supplement or modification is sought.
(c) Choice of Law. This Agreement will be interpreted, construed
and enforced in accordance with the laws of the State of Florida,
without giving effect to the application of the principles pertaining
to conflicts of laws.
(d) Effect of Waiver. The failure of any party at any time or
times to require performance of any provision of this Agreement will
in no manner affect the right to enforce the same. The waiver by any
party of any breach of any provision of this Agreement will not be
construed to be a waiver by any such party of any succeeding breach of
that provision or a waiver by such party of any breach of any other
provision.
(e) Construction. The parties hereto and their respective legal
counsel participated in the preparation of this Agreement; therefore,
this Agreement shall be construed neither against nor in favor of any
of the parties hereto, but rather in accordance with the fair meaning
thereof.
(f) Severability. The invalidity, illegality or unenforceability
of any provision or provisions of this Agreement will not affect any
other provision of this Agreement, which will remain in full force and
effect, nor will the invalidity, illegality or unenforceability of a
portion of any provision of this Agreement affect the balance of such
provision. In the event that any one or more of the provisions
contained in this Agreement or any portion thereof shall for any
reason be held to be invalid, illegal or unenforceable in any respect,
this Agreement shall be reformed, construed and enforced as if such
invalid, illegal or unenforceable provision had never been contained
herein.
(g) Enforcement. Should it become necessary for any party to
institute legal action to enforce the terms and conditions of this
Agreement, the successful party will be awarded reasonable attorneys'
fees at all trial and appellate levels, expenses and costs.
(h) Binding Nature. This Agreement will be binding upon and will
inure to the benefit of any successor or successors of the parties
hereto.
(i) Counterparts. This Agreement may be executed in one or more
counterparts, each of which will be deemed an original and all of
which together will constitute one and the same instrument.
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IN WITNESS WHEREOF, the Purchaser has caused this Agreement to be
executed as of the date first above written.
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AGREED AND ACCEPTED this
____ day of September, 1996
SANDATA, INC., a Delaware corporation
By:
Name:
Title:
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