PERF-GO GREEN 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) At closing, a check or money order made payable to Signature Bank, as
Escrow Agent for Perf-Go Green 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 Perf Go-Green
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) When countersigned by Perf-Go Green 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) An accepted copy of this Agreement and a Debenture and Warrant issued in
your name will be returned to you contemporaneously with your signing of
this Agreement.
ALL SUBSCRIPTION DOCUMENTS MUST BE COMPLETE AND ONLY THE PROSPECTIVE INVESTOR'S
PRINCIPAL RESIDENCE SHOULD BE STATED.
SUBSCRIPTION AGREEMENT
Name of Subscriber ________________________
Perf-Go Green Holdings, Inc.
000 Xxxxx Xxxxxx, 0xx Xxxxx
Xxx 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 in substantially the form attached
hereto as Exhibit A (the "Notes") and Warrants to purchase common stock in
substantially the form attached hereto as Exhibit B (the "Warrants") of Perf-Go
Green 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 offering size (inclusive of previously accepted subscriptions) will be
$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 $___________. At the Closing, the Investor will pay $1,000 for each
$1,000 of principal amount of the Notes and related Warrants. I understand that
a closing will not be held until the Minimum Offering is received 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 (as
converted, collectively, the "Conversion Shares"). 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 (as
exercised, the "Warrant Shares"). 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.
The Notes, the Conversion Shares, the Warrants and the Warrant Shares
collectively are referred to herein as the "Securities".
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2. Purchase.
(a) Subject to the satisfaction (or waiver) of the conditions set forth in
Sections 12 and 13 below, the Company shall issue and sell to each Investor, and
each Investor severally, but not jointly, agrees to purchase from the Company on
the Closing Date (as defined below), (x) a principal amount of Notes as is set
forth above and (y) the corresponding number of Warrants as specified above (the
"Closing").
(b) In the event that the Closing shall not have occurred with respect to
an Investor on or before five (5) Business Days from the date hereof due to the
Company's or such Buyer's failure to satisfy the conditions set forth in
Sections 12 and 13 below (and the nonbreaching party's failure to waive such
unsatisfied condition(s)), the nonbreaching party shall have the option to
terminate this Agreement with respect to such breaching party at the close of
business on such date without liability of any party to any other party.
3. [RESERVED]
4. [RESERVED]
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 Company is selling the Securities pursuant
to this Agreement 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
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
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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 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, to my knowledge,
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.
(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.
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(h) Residence. I reside, or my office primarily responsible for the
purchase of the Securities is located, at the address listed on the
signature page.
(i) 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.
(j) Reliance. I understand that this agreement is made with me in reliance
upon my representations to the Company, as set forth above.
(k) Legend. I understand that the certificates or other instruments
representing the Notes and the Warrants and, until such time as the
resale of the Conversion Shares, the Common Shares and the Warrant
Shares have been registered under the 1933 Act as contemplated by the
Registration Rights Agreement, the stock certificates representing the
Conversion Shares, the Common Shares and the Warrant Shares, except as
set forth below, shall bear any legend as required by the "blue sky"
laws of any state and a restrictive legend in substantially the
following form (and a stop-transfer order may be placed against
transfer of such stock certificates):
[NEITHER THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS
CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE
[CONVERTIBLE] [EXERCISABLE] HAVE BEEN][THE SECURITIES REPRESENTED BY
THIS CERTIFICATE HAVE NOT BEEN] REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES
MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE
ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF
COUNSEL, IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT
REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO RULE 144 OR
RULE 144A UNDER SAID ACT. NOTWITHSTANDING THE FOREGOING, THE
SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN
ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE
SECURITIES.
The legend set forth above shall be removed and the Company shall issue a
certificate without such legend to the holder of the Securities upon which it is
stamped or issue to such holder by electronic delivery at the applicable balance
account at DTC (as defined below), if, unless otherwise required by state
securities laws, (i) such Securities are registered for resale under the 1933
Act, (ii) in connection with a sale, assignment or other transfer, such holder
provides the Company with an opinion of counsel, in a generally acceptable form,
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to the effect that such sale, assignment or transfer of the Securities may be
made without registration under the applicable requirements of the 1933 Act, or
(iii) such holder provides the Company with reasonable assurance that the
Securities can be sold, assigned or transferred pursuant to Rule 144 or Rule
144A.
7. Company Representations and Warranties. The Company represents and
warrants to each of the Investors, as of the date hereof and as of the date of
Closing as follows (which representations and warranties shall be deemed to
apply, as appropriate, to each subsidiary of the Company, including without
limitation, Perf-Go Green, Inc:
(a) Organization and Authority.
(i) Organization. Each of the Company and its "Subsidiaries" (which
for purposes of this Agreement means any entity in which the
Company, directly or indirectly, owns any of the capital stock or
holds an equity or similar interest) are entities duly organized
and validly existing in good standing under the laws of the
jurisdiction in which they are formed, and have the requisite
power and authorization to own their properties and to carry on
their business as now being conducted. Each of the Company and
its Subsidiaries is duly qualified as a foreign entity to do
business and is in good standing in every jurisdiction in which
its ownership of property or the nature of the business conducted
by it makes such qualification necessary, except to the extent
that the failure to be so qualified or be in good standing would
not have a Material Adverse Effect. As used in this Agreement,
"Material Adverse Effect" means any material adverse effect on
the business, properties, assets, operations, results of
operations, condition (financial or otherwise) or prospects of
the Company and its Subsidiaries, taken as a whole, or on the
transactions contemplated hereby and the other Transaction
Documents or by the agreements and instruments to be entered into
in connection herewith or therewith, or on the authority or
ability of the Company to perform its obligations under the
Transaction Documents (as defined below). The Company has no
Subsidiaries, except Perf-Go Green, Inc.
(ii) Authorization; Enforcement; Validity. The Company has the
requisite power and authority to enter into and perform its
obligations under this Agreement, the Notes, the Irrevocable
Transfer Agent Instructions, the Warrants, and each of the other
agreements entered into by the parties hereto in connection with
the transactions contemplated by this Agreement (collectively,
the "Transaction Documents") and to issue the Securities in
accordance with the terms hereof and thereof. The execution and
delivery of the Transaction Documents by the Company and the
consummation by the Company of the transactions contemplated
hereby and thereby, including, without limitation, the issuance
of the Notes and the Warrants, the reservation for issuance and
the issuance of the shares issuable upon conversion of the Notes,
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the reservation for issuance and issuance of Warrant Shares
issuable upon exercise of the Warrants and any shares issued in
connection with the payment of interest (the "Interest Shares")
and the granting of a security interest in the Collateral (as
defined in the Security Agreement) have been duly authorized by
the Company's Board of Directors and (other than (i) the filing
of appropriate UCC financing statements with the appropriate
states and other authorities pursuant to the Security Agreement,
(ii) the filing with the SEC of one or more registration
statements in accordance with the Registration Rights Agreement
between the Company and the Holders) and (iii) appropriate "blue
sky" state securities law filings, no further filing, consent, or
authorization is required by the Company, its Board of Directors
or its stockholders. This Agreement and the other Transaction
Documents of even date herewith have been duly executed and
delivered by the Company, and constitute the legal, valid and
binding obligations of the Company, enforceable against the
Company in accordance with their respective terms, except as such
enforceability may be limited by general principles of equity or
applicable bankruptcy, insolvency, reorganization, moratorium,
liquidation or similar laws relating to, or affecting generally,
the enforcement of applicable creditors' rights and remedies.
(iii) Issuance of Securities. The issuance of the Notes, the Common
Shares and the Warrants are duly authorized and are free from all
taxes, liens and charges with respect to the issue thereof. As of
the applicable Closing, a number of shares of Common Stock shall
have been duly authorized and reserved for issuance which equals
at least (i) 100% of the number of Common Shares issued hereunder
and (ii) 130% of the sum of the maximum number of shares Common
Stock issuable (A) as Interest pursuant to the terms of the
Notes, (B) upon conversion of the Notes issued at such Closing
and issued at all prior Closings and (C) upon exercise of the
Warrants. Upon conversion or payment in accordance with the Notes
or exercise in accordance with the Warrants, as the case may be,
the Conversion Shares, the Interest Shares and the Warrant
Shares, respectively, will be validly issued, fully paid and
nonassessable and free from all preemptive or similar rights,
taxes, liens and charges with respect to the issue thereof, with
the holders being entitled to all rights accorded to a holder of
Common Stock. The offer and issuance by the Company of the
Securities is exempt from registration under the 1933 Act.
(iv) No Conflicts. The execution, delivery and performance of the
Transaction Documents by the Company and the consummation by the
Company of the transactions contemplated hereby and thereby
(including, without limitation, the issuance of the Notes and the
Warrants, the granting of a security interest in the Collateral
and reservation for issuance and issuance of the Conversion
Shares, the Interest Shares and the Warrant Shares) will not (i)
result in a violation of the Articles of Incorporation (as
defined in Section 3(r)) of the Company or any of its
Subsidiaries, any capital stock of the Company or Bylaws (as
defined in Section 3(r)) of the Company or any of its
6
Subsidiaries, or (ii) conflict with, or constitute a default (or
an event which with notice or lapse of time or both would become
a default) under, or give to others any rights of termination,
amendment, acceleration or cancellation of, any agreement,
indenture or instrument to which the Company or any of its
Subsidiaries is a party, or (iii) result in a violation of any
law, rule, regulation, order, judgment or decree (including
federal and state securities laws and regulations and the rules
and regulations of the OTC Bulletin Board (the "Principal
Market")) applicable to the Company or any of its Subsidiaries or
by which any property or asset of the Company or any of its
Subsidiaries is bound or affected.
(v) Consents. Neither the Company nor any of its Subsidiaries is
required to obtain any consent, authorization or order of, or
make any filing or registration with, any court, governmental
agency or any regulatory or self-regulatory agency or any other
Person in order for it to execute, deliver or perform any of its
obligations under or contemplated by the Transaction Documents,
in each case in accordance with the terms hereof or thereof. All
consents, authorizations, orders, filings and registrations which
the Company is required to obtain pursuant to the preceding
sentence have been obtained or effected on or prior to the
Closing Date, and the Company is unaware of any facts or
circumstances which might prevent the Company from obtaining or
effecting any of the registration, application or filings
pursuant to the preceding sentence.
(vi) Acknowledgment Regarding Investor's Purchase of Securities. The
Company acknowledges and agrees that Investor is acting solely in
the capacity of arm's length purchaser with respect to the
Transaction Documents and the transactions contemplated hereby
and thereby and that no Investor is (i) an officer or director of
the Company, (ii) to its knowledge, an "affiliate" of the Company
(as defined in Rule 144) or (iii) to the knowledge of the
Company, a "beneficial owner" of more than 10% of the shares of
Common Stock (as defined for purposes of Rule 13d-3 of the
Securities Exchange Act of 1934, as amended (the "1934 Act")).
The Company further acknowledges that Investor is not acting as a
financial advisor or fiduciary of the Company (or in any similar
capacity) with respect to the Transaction Documents and the
transactions contemplated hereby and thereby, and any advice
given by a Investor or any of its representatives or agents in
connection with the Transaction Documents and the transactions
contemplated hereby and thereby is merely incidental to such
Investor's purchase of the Securities. The Company further
represents to each Investor that the Company's decision to enter
into the Transaction Documents has been based solely on the
independent evaluation by the Company and its representatives.
(vii) No General Solicitation; Placement Agent's Fees. Neither the
Company, nor any of its affiliates, nor any Person acting on its
or their behalf, has engaged in any form of general solicitation
or general advertising (within the meaning of Regulation D) in
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connection with the offer or sale of the Securities. The Company
shall be responsible for the payment of any placement agent's
fees, financial advisory fees, or brokers' commissions (other
than for persons engaged by any Investor or its investment
advisor) relating to or arising out of the transactions
contemplated hereby. The Company shall pay, and hold each
Investor harmless against, any liability, loss or expense
(including, without limitation, attorney's fees and out-of-pocket
expenses) arising in connection with any such claim. The Company
acknowledges that it has engaged vFinance Investments, Inc. as
placement agent (the "Placement Agent") in connection with the
sale of the Securities. Other than the Placement Agent, the
Company has not engaged any placement agent or other agent in
connection with the sale of the Securities.
(viii) No Integrated Offering. None of the Company, its Subsidiaries,
any of their affiliates, and any Person acting on their behalf
has, directly or indirectly, made any offers or sales of any
security or solicited any offers to buy any security, under
circumstances that would require registration of any of the
Securities under the 1933 Act or cause this offering of the
Securities to be integrated with prior offerings by the Company
for purposes of the 1933 Act or any applicable stockholder
approval provisions, including, without limitation, under the
rules and regulations of any exchange or automated quotation
system on which any of the securities of the Company are listed
or designated. None of the Company, its Subsidiaries, their
affiliates and any Person acting on their behalf will take any
action or steps referred to in the preceding sentence that would
require registration of any of the Securities under the 1933 Act
or cause the offering of the Securities to be integrated with
other offerings.
(ix) Dilutive Effect. The Company understands and acknowledges that
the number of Conversion Shares issuable upon conversion of the
Notes and the Warrant Shares issuable upon exercise of the
Warrants will increase in certain circumstances. The Company
further acknowledges that its obligation to issue Conversion
Shares upon conversion of the Notes in accordance with this
Agreement and the Notes and its obligation to issue the Warrant
Shares upon exercise of the Warrants in accordance with this
Agreement and the Warrants, in each case, is absolute and
unconditional regardless of the dilutive effect that such
issuance may have on the ownership interests of other
stockholders of the Company.
(x) Application of Takeover Protections; Rights Agreement. The
Company has not adopted a stockholder rights plan or similar
arrangement relating to accumulations of beneficial ownership of
Common Stock or a change in control of the Company.
(b) SEC Documents.
8
(i) The Company is current with its reporting obligations under the
Securities Exchange Act of 1934, as amended (the "Exchange Act").
None of the Company's filings made pursuant to the Exchange Act
(collectively, the "SEC Documents") contains any untrue statement
of a material fact or omitted to state a material fact required
to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not
misleading. The Company SEC Documents, as of their respective
dates, were timely filed and complied in all material respects
with the requirements of the Exchange Act, and the rules and
regulations of the Commission thereunder, and are available on
the Commission's XXXXX system.
(ii) The Company SEC Documents include the Company's audited
consolidated financial statements for the fiscal years ended
October 31, 2007 and 2006 and the unaudited consolidated
financial statements for the quarters ended January 31, 2008 and
April 30, 2008 (collectively, the "Financial Statements"),
including, in each case, a balance sheet and the related
statements of income, stockholders' equity and cash flows for the
period then ended, together with the related notes. The audited
Financial Statements for the fiscal year ended October 31, 2007
have been certified by Xxxx & Company, P.A. ("Xxxx"). The audited
Financial Statements for the fiscal year ended October 31, 2006
have been certified by Xxxxxxxx & Xxxxxxx, X.X. ("Xxxxxxxx"). The
Financial Statements which have been prepared from the books,
records and accounts of the Company, are true, correct and
complete and have been prepared in accordance with GAAP,
consistently applied. Xxxx is independent as to the Company under
the rules of the Commission pursuant to the Securities Act and is
registered with the Public Company Accounting Oversight Board
("PCAOB"). The Financial Statements present fairly and accurately
the financial position of the Company at the respective balance
sheet dates, and fairly and accurately present the results of the
Company's operations, changes in stockholders' equity and cash
flows for the periods covered.
(iii) Other than as disclosed in the SEC Documents, at the close of
business on October 31, 2007, the Company did not have any
material liabilities, absolute or contingent, of the type
required to be reflected on balance sheets prepared in accordance
with GAAP which are not fully reflected, reserved against or
disclosed on the October 31, 2007 balance sheet. The Company has
not guaranteed or assumed or incurred any obligation with respect
to any debt or obligations of any Person. The Company does not
have any debts, contracts, guaranty, standby, indemnity or hold
harmless commitments, liabilities or obligations of any kind,
character or description, whether accrued, absolute, contingent
or otherwise, or due or to become due except to the extent set
forth or noted in the Financial Statements, and not heretofore
paid or discharged.
9
(c) Absence of Changes. Since October 31, 2007, except as set forth on
Schedule 7(c) there have not been:
(i) any change in the consolidated assets, liabilities, or financial
condition of the Company, except changes in the ordinary course
of business which do not and will not have a Material Adverse
Effect on the Company;
(ii) any damage, destruction, or loss to the Company's assets, whether
or not covered by insurance, materially and adversely affecting
the assets or financial condition of the Company (as conducted
and as proposed to be conducted);
(iii) any change or amendment to a contract, to the Company's
certificate of incorporation or by-laws, or arrangement to which
the Company is a party other than contracts which are to be
terminated at or prior to the Closing which are set forth on
Schedule 7(c);
(iv) any loans made by the Company to any affiliate of the Company or
any of the Company's employees, officers, directors, Stockholders
or any of its affiliates;
(v) any declaration or payment of any dividend or other distribution
or any redemption of any capital stock of the Company;
(vi) any sale, transfer or issuance of any shares of capital stock or
other securities of the Company, except for (i) the shares sold
to the investors in the previous financing that raised $2,100,000
for the Company, (ii) the Notes and Warrants issued to investors
in the Private Placement on May 13, 2008, (iii) the shares of
Common Stock issued to the shareholders of Perf-Go Green, Inc.
issued in connection with the Share Exchange Agreement by and
between the Company and the shareholders of Perf-Go Green, Inc.
dated May 13, 2008, and (iv) the shares of common stock of
Perf-Go Green, Inc. issued to certain investors in connection
with the conversion of senior secured convertible notes in an
offering consummated in January and February 2008 in the amount
of $750,000;
(vii) any sale, transfer, or lease of any of the Company's assets
other than in the ordinary course of business;
(viii) any capital expenditure;
(ix) any other event or condition of any character which might have a
Material Adverse Effect on the Company;
(x) any satisfaction or discharge of any lien, claim or encumbrance
or payment of any obligation by Company except in the ordinary
10
course of business and that is not material to the assets or
financial condition of the Company; or
(xi) any agreement or commitment by the Company to do any of the
things described in this Section 7(c).
(d) No Undisclosed Events, Liabilities, Developments or Circumstances. No
event, liability, development or circumstance has occurred or exists, or is
contemplated to occur with respect to the Company, its Subsidiaries or their
respective business, properties, prospects, operations or financial condition,
that would be required to be disclosed by the Company under applicable
securities laws on a registration statement on Form S-1 filed with the SEC
relating to an issuance and sale by the Company of its Common Stock and which
has not been publicly announced.
(e) Conduct of Business; Regulatory Permits. Neither the Company nor its
Subsidiaries is in violation of any term of or in default under its Articles of
Incorporation or Bylaws or their organizational charter or certificate of
incorporation or bylaws, respectively. Neither the Company nor any of its
Subsidiaries is in violation of any judgment, decree or order or any statute,
ordinance, rule or regulation applicable to the Company or its Subsidiaries, and
neither the Company nor any of its Subsidiaries will conduct its business in
violation of any of the foregoing, except for possible violations which would
not, individually or in the aggregate, have a Material Adverse Effect. Without
limiting the generality of the foregoing, the Company is not in violation of any
of the rules, regulations or requirements of the Principal Market and has no
knowledge of any facts or circumstances which would reasonably lead to delisting
or suspension of the Common Stock by the Principal Market in the foreseeable
future. Since July 2007, the Common Stock has been designated for quotation on
the Principal Market. Since July 2007, (i) trading in the Common Stock has not
been suspended by the SEC or the Principal Market and (ii) the Company has
received no communication, written or oral, from the SEC or the Principal Market
regarding the suspension or delisting of the Common Stock from the Principal
Market. The Company and its Subsidiaries possess all certificates,
authorizations and permits issued by the appropriate regulatory authorities
necessary to conduct their respective businesses, except where the failure to
possess such certificates, authorizations or permits would not have,
individually or in the aggregate, a Material Adverse Effect, and neither the
Company nor any such Subsidiary has received any notice of proceedings relating
to the revocation or modification of any such certificate, authorization or
permit.
(f) Foreign Corrupt Practices. Neither the Company, nor any of its
Subsidiaries, nor any director, officer, agent, employee or other Person acting
on behalf of the Company or any of its Subsidiaries has, in the course of its
actions for, or on behalf of, the Company or any of its Subsidiaries (i) used
any corporate funds for any unlawful contribution, gift, entertainment or other
unlawful expenses relating to political activity; (ii) made any direct or
indirect unlawful payment to any foreign or domestic government official or
11
employee from corporate funds; (iii) violated or is in violation of any
provision of the U.S. Foreign Corrupt Practices Act of 1977, as amended; or (iv)
made any unlawful bribe, rebate, payoff, influence payment, kickback or other
unlawful payment to any foreign or domestic government official or employee.
(g) Transactions With Affiliates. Except as set forth on Schedule 7(g),
none of the officers, directors or employees of the Company is presently a party
to any transaction with the Company or any of its Subsidiaries (other than for
ordinary course services as employees, officers or directors), including any
contract, agreement or other arrangement providing for the furnishing of
services to or by, providing for rental of real or personal property to or from,
or otherwise requiring payments to or from any such officer, director or
employee or, to the knowledge of the Company or any of its Subsidiaries, any
corporation, partnership, trust or other entity in which any such officer,
director, or employee has a substantial interest or is an officer, director,
trustee or partner.
(h) Equity Capitalization. As of the date hereof, the authorized capital
stock of the Company consists of (i) 100,000,000 shares of Common Stock, of
which as of the date hereof, 32,279,470 are issued and outstanding, 10,000,000
shares are reserved for issuance pursuant to the Company's stock option and
purchase plans. All of such outstanding shares have been, or upon issuance will
be, validly issued and are fully paid and nonassessable. Except as set forth on
Schedule 7(h), (i) none of the Company's capital stock is subject to preemptive
rights or any other similar rights or any liens or encumbrances suffered or
permitted by the Company; (ii) there are no outstanding options, warrants,
scrip, rights to subscribe to, calls or commitments of any character whatsoever
relating to, or securities or rights convertible into, or exercisable or
exchangeable for, any capital stock of the Company or any of its Subsidiaries,
or contracts, commitments, understandings or arrangements by which the Company
or any of its Subsidiaries is or may become bound to issue additional capital
stock of the Company or any of its Subsidiaries or options, warrants, scrip,
rights to subscribe to, calls or commitments of any character whatsoever
relating to, or securities or rights convertible into, or exercisable or
exchangeable for, any capital stock of the Company or any of its Subsidiaries;
(iii) there are no outstanding debt securities, notes, credit agreements, credit
facilities or other agreements, documents or instruments evidencing Indebtedness
of the Company or any of its Subsidiaries or by which the Company or any of its
Subsidiaries is or may become bound; (iv) there are no financing statements
securing obligations in any material amounts, either singly or in the aggregate,
filed in connection with the Company or any of its Subsidiaries; (v) there are
no agreements or arrangements under which the Company or any of its Subsidiaries
is obligated to register the sale of any of their securities under the 1933 Act
(except pursuant to Section 4(u) hereof); (vi) there are no outstanding
securities or instruments of the Company or any of its Subsidiaries which
contain any redemption or similar provisions, and there are no contracts,
commitments, understandings or arrangements by which the Company or any of its
Subsidiaries is or may become bound to redeem a security of the Company or any
of its Subsidiaries; (vii) there are no securities or instruments containing
anti-dilution or similar provisions that will be triggered by the issuance of
the Securities; (viii) the Company does not have any stock appreciation rights
or "phantom stock" plans or agreements or any similar plan or agreement; and
(ix) the Company and its Subsidiaries have no liabilities or obligations
12
required to be disclosed in the SEC Documents but not so disclosed in the SEC
Documents, other than those incurred in the ordinary course of the Company's or
its Subsidiaries' respective businesses and which, individually or in the
aggregate, do not or would not have a Material Adverse Effect. True, correct and
complete copies of the Company's Articles of Incorporation, as amended and as in
effect on the date hereof (the "Articles of Incorporation"), and the Company's
Bylaws, as amended and as in effect on the date hereof (the "Bylaws") are
available for review on the XXXXX system maintained by the U.S. Securities and
Exchange Commission.
(i) Indebtedness and Other Contracts. Except as disclosed in Schedule 7(i),
neither the Company nor any of its Subsidiaries (i) has any outstanding
Indebtedness (as defined below), (ii) is a party to any contract, agreement or
instrument, the violation of which, or default under which, by the other
party(ies) to such contract, agreement or instrument would result in a Material
Adverse Effect, (iii) is in violation of any term of or in default under any
contract, agreement or instrument relating to any Indebtedness, except where
such violations and defaults would not result, individually or in the aggregate,
in a Material Adverse Effect, or (iv) is a party to any contract, agreement or
instrument relating to any Indebtedness, the performance of which, in the
judgment of the Company's officers, has or is expected to have a Material
Adverse Effect. Schedule 7(i) provides a description of the material terms of
any such outstanding Indebtedness. For purposes of this Agreement: (x)
"Indebtedness" of any Person means, without duplication (A) all indebtedness for
borrowed money, (B) all obligations issued, undertaken or assumed as the
deferred purchase price of property or services (other than trade payables
entered into in the ordinary course of business), (C) all reimbursement or
payment obligations with respect to letters of credit, surety bonds and other
similar instruments, (D) all obligations evidenced by notes, bonds, debentures
or similar instruments, including obligations so evidenced incurred in
connection with the acquisition of property, assets or businesses, (E) all
indebtedness created or arising under any conditional sale or other title
retention agreement, or incurred as financing, in either case with respect to
any property or assets acquired with the proceeds of such indebtedness (even
though the rights and remedies of the seller or bank under such agreement in the
event of default are limited to repossession or sale of such property), (F) all
monetary obligations under any leasing or similar arrangement which, in
connection with generally accepted accounting principles, consistently applied
for the periods covered thereby, is classified as a capital lease, (G) all
indebtedness referred to in clauses (A) through (F) above secured by (or for
which the holder of such Indebtedness has an existing right, contingent or
otherwise, to be secured by) any mortgage, lien, pledge, charge, security
interest or other encumbrance upon or in any property or assets (including
accounts and contract rights) owned by any Person, even though the Person which
owns such assets or property has not assumed or become liable for the payment of
such indebtedness, and (H) all Contingent Obligations in respect of indebtedness
or obligations of others of the kinds referred to in clauses (A) through (G)
above; (y) "Contingent Obligation" means, as to any Person, any direct or
indirect liability, contingent or otherwise, of that Person with respect to any
indebtedness, lease, dividend or other obligation of another Person if the
primary purpose or intent of the Person incurring such liability, or the primary
effect thereof, is to provide assurance to the obligee of such liability that
such liability will be paid or discharged, or that any agreements relating
13
thereto will be complied with, or that the holders of such liability will be
protected (in whole or in part) against loss with respect thereto; and (z)
"Person" means an individual, a limited liability company, a partnership, a
joint venture, a corporation, a trust, an unincorporated organization and a
government or any department or agency thereof.
(j) Absence of Litigation. There is no action, suit, proceeding, inquiry or
investigation before or by the Principal Market, any court, public board,
government agency, self-regulatory organization or body pending or, to the
knowledge of the Company, threatened against or affecting the Company or any of
its Subsidiaries, the Common Stock or any of the Company's Subsidiaries or any
of the Company's or its Subsidiaries' officers or directors in their capacities
as such, except as set forth in Schedule 7(j).
(k) Insurance. The Company and each of its Subsidiaries are insured by
insurers of recognized financial responsibility against such losses and risks
and in such amounts as management of the Company believes to be prudent and
customary in the businesses in which the Company and its Subsidiaries are
engaged. Neither the Company nor any such Subsidiary has been refused any
insurance coverage sought or applied for and neither the Company nor any such
Subsidiary has any reason to believe that it will not be able to renew its
existing insurance coverage as and when such coverage expires or to obtain
similar coverage from similar insurers as may be necessary to continue its
business at a cost that would not have a Material Adverse Effect.
(l) Employee Relations. Neither the Company nor any of its Subsidiaries is
a party to any collective bargaining agreement or employs any member of a union.
The Company and its Subsidiaries believe that their relations with their
employees are good. No executive officer of the Company or any of its
Subsidiaries (as defined in Rule 501(f) of the 1933 Act) has notified the
Company or any such Subsidiary that such officer intends to leave the Company or
otherwise terminate such officer's employment with the Company or any such
Subsidiary. No executive officer of the Company or any of its Subsidiaries, to
the knowledge of the Company, is, or is now expected to be, in violation of any
material term of any employment contract, confidentiality, disclosure or
proprietary information agreement, non-competition agreement, or any other
contract or agreement or any restrictive covenant, and the continued employment
of each such executive officer does not subject the Company or any of its
Subsidiaries to any liability with respect to any of the foregoing matters.
(m) The Company and its Subsidiaries are in compliance with all federal,
state, local and foreign laws and regulations respecting labor, employment and
employment practices and benefits, terms and conditions of employment and wages
and hours, except where failure to be in compliance would not, either
individually or in the aggregate, reasonably be expected to result in a Material
Adverse Effect.
(n) Title. Except as disclosed in Schedule 7(n) the Company and its
Subsidiaries have good and marketable title in fee simple to all personal
property owned by them which is material to the business of the Company and its
Subsidiaries, in each case free and clear of all liens, encumbrances and defects
except such as do not materially affect the value of such property and do not
14
interfere with the use made and proposed to be made of such property by the
Company and any of its Subsidiaries. Neither the Company nor any of its
Subsidiaries own any real property nor is a party to any written lease
agreement.
(o) Intellectual Property Rights. The Company and its Subsidiaries own or
possess adequate rights or licenses to use all trademarks, trade names, service
marks, service mark registrations, service names, patents, patent rights,
copyrights, inventions, licenses, approvals, governmental authorizations, trade
secrets and other intellectual property rights ("Intellectual Property Rights")
necessary to conduct their respective businesses as now conducted. Except as set
forth in Schedule 7(o) none of the Company's Intellectual Property Rights have
expired or terminated, or are expected to expire or terminate, within three
years from the date of this Agreement. The Company does not have any knowledge
of any infringement by the Company or its Subsidiaries of Intellectual Property
Rights of others. There is no claim, action or proceeding being made or brought,
or to the knowledge of the Company, being threatened, against the Company or its
Subsidiaries regarding its Intellectual Property Rights. The Company is unaware
of any facts or circumstances which might give rise to any of the foregoing
infringements or claims, actions or proceedings. The Company and its
Subsidiaries have taken reasonable security measures to protect the secrecy,
confidentiality and value of all of their intellectual properties.
(p) Environmental Laws. The Company and its Subsidiaries (i) are in
compliance with any and all Environmental Laws (as hereinafter defined), (ii)
have received all permits, licenses or other approvals required of them under
applicable Environmental Laws to conduct their respective businesses and (iii)
are in compliance with all terms and conditions of any such permit, license or
approval where, in each of the foregoing clauses (i), (ii) and (iii), the
failure to so comply could be reasonably expected to have, individually or in
the aggregate, a Material Adverse Effect. The term "Environmental Laws" means
all federal, state, local or foreign laws relating to pollution or protection of
human health or the environment (including, without limitation, ambient air,
surface water, groundwater, land surface or subsurface strata), including,
without limitation, laws relating to emissions, discharges, releases or
threatened releases of chemicals, pollutants, contaminants, or toxic or
hazardous substances or wastes (collectively, "Hazardous Materials") into the
environment, or otherwise relating to the manufacture, processing, distribution,
use, treatment, storage, disposal, transport or handling of Hazardous Materials,
as well as all authorizations, codes, decrees, demands or demand letters,
injunctions, judgments, licenses, notices or notice letters, orders, permits,
plans or regulations issued, entered, promulgated or approved thereunder.
(q) Subsidiary Rights. Except as set forth in Schedule 7(q), the Company or
one of its Subsidiaries has the unrestricted right to vote, and (subject to
limitations imposed by applicable law) to receive dividends and distributions
on, all capital securities of its Subsidiaries as owned by the Company or such
Subsidiary
(r) Investment Company Status. The Company is not, and upon consummation of
the sale of the Securities will not be, an "investment company," a company
controlled by an "investment company" or an "affiliated person" of, or
"promoter" or "principal underwriter" for, an "investment company" as such terms
15
are defined in the Investment Company Act of 1940, as amended.
(s) Taxes. The Company and each of its Subsidiaries has filed all federal,
state, county and local income, excise, franchise, property and other tax,
governmental and/or related returns, forms, or reports, which are due or
required to be filed by it prior to the date hereof, except where the failure to
do so would have no material adverse impact on the Company, and has paid or made
adequate provision in the financial statement included in the Company SEC
Documents for the payment of all taxes, fees, or assessments which have or may
become due pursuant to such returns or pursuant to any assessments received. The
Company is not delinquent or obligated for any tax, penalty, interest,
delinquency or charge.
(t) Off Balance Sheet Arrangements. There is no transaction, arrangement,
or other relationship between the Company and an unconsolidated or other off
balance sheet entity that is required to be disclosed by the Company in its
Exchange Act filings and is not so disclosed or that otherwise would be
reasonably likely to have a Material Adverse Effect.
(u) Ranking of Notes. No Indebtedness of the Company is senior to or ranks
pari passu with the Notes in right of payment, whether with respect of payment
of redemptions, interest, damages or upon liquidation or dissolution or
otherwise.
(v) Form S-1 Eligibility. The Company is eligible to register the
Conversion Shares and the Warrant Shares for resale by the Investors using Form
S-1 promulgated under the 1933 Act.
(w) Transfer Taxes. On the Closing Date, all stock transfer or other taxes
(other than income or similar taxes) which are required to be paid in connection
with the sale and transfer of the Securities to be sold to each Investor
hereunder will be, or will have been, fully paid or provided for by the Company,
and all laws imposing such taxes will be or will have been complied with.
(x) Manipulation of Price. The Company has not, and to its knowledge no one
acting on its behalf has, (i) taken, directly or indirectly, any action designed
to cause or to result in the stabilization or manipulation of the price of any
security of the Company to facilitate the sale or resale of any of the
Securities, (ii) other than the Placement Agent, sold, bid for, purchased, or
paid any compensation for soliciting purchases of, any of the Securities, or
(iii) other than the Placement Agent, paid or agreed to pay to any person any
compensation for soliciting another to purchase any other securities of the
Company.
(y) Acknowledgement Regarding Investors' Trading Activity. It is understood
and acknowledged by the Company that, except as provided in Section 4(s), (i)
none of the Investors have been asked to agree, nor has any Investor agreed, to
desist from purchasing or selling, long and/or short, securities of the Company,
or "derivative" securities based on securities issued by the Company or to hold
the Securities for any specified term; (ii) any Investor, and counter parties in
"derivative" transactions to which any such Investor is a party, directly or
16
indirectly, presently may have a "short" position in the Common Stock, and (iii)
each Investor shall not be deemed to have any affiliation with or control over
any arm's length counter-party in any "derivative" transaction. The Company
further understands and acknowledges that (a) one or more Investors may engage
in hedging and/or trading activities at various times during the period that the
Securities are outstanding, including, without limitation, during the periods
that the value of the Conversion Shares, the Warrant Shares and any Interest
Shares deliverable with respect to Securities are being determined and (b) such
hedging and/or trading activities, if any, can reduce the value of the existing
stockholders' equity interest in the Company both at and after the time the
hedging and/or trading activities are being conducted. The Company acknowledges
that such aforementioned hedging and/or trading activities do not constitute a
breach of this Agreement, the Notes, the Warrants or any of the documents
executed in connection herewith.
(z) U.S. Real Property Holding Corporation. The Company is not, nor has
ever been, a U.S. real property holding corporation within the meaning of
Section 897 of the Internal Revenue Code of 1986, as amended, and the Company
shall so certify upon Investor's request.
(aa) Bank Holding Company Act Neither the Company nor any of its
Subsidiaries or affiliates is subject to the Bank Holding Company Act of 1956,
as amended (the "BHCA") and to regulation by the Board of Governors of the
Federal Reserve System (the "Federal Reserve"). Neither the Company nor any of
its Subsidiaries or affiliates owns or controls, directly or indirectly, five
percent or more of the outstanding shares of any class of voting securities or
twenty-five percent or more of the total equity of a bank or any entity that is
subject to the BHCA and to regulation by the Federal Reserve. Neither the
Company nor any of its Subsidiaries or affiliates exercises a controlling
influence over the management or policies of a bank or any entity that is
subject to the BHCA and to regulation by the Federal Reserve
(bb) Disclosure. The Company confirms that neither it nor any other Person
acting on its behalf has provided any of the Investors or their agents or
counsel with any information that constitutes or could reasonably be expected to
constitute material, nonpublic information other than as set forth in the
following sentence. The Company understands and confirms that each of the
Investors will rely on the foregoing representations in effecting transactions
in securities of the Company. All disclosure provided to the Investors regarding
the Company, its business and the transactions contemplated hereby, including
the Schedules to this Agreement, furnished by or on behalf of the Company is
true and correct and does not contain any untrue statement of a material fact or
omit to state any material fact necessary in order to make the statements made
therein, in the light of the circumstances under which they were made, not
misleading. Each press release issued by the Company during the twelve (12)
months preceding the date of this Agreement did not at the time of release
contain any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they are made, not
misleading. No event or circumstance has occurred or information exists with
17
respect to the Company or any of its Subsidiaries or its or their business,
properties, prospects, operations or financial conditions, which, under
applicable law, rule or regulation, requires public disclosure or announcement
by the Company but which has not been so publicly announced or disclosed.
(cc) Financial Projections. The Company confirms 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.
(dd) Brokers or Finders. The Company confirms 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.
(ee) Xxxxxxxx-Xxxxx Act. The Company has not (i) adopted a Code of Ethics
for Senior Financial Officers, (ii) appointed an audit committee and complied
with all rules and regulations applicable thereto, or (iii) adopted a procedure
for reporting of complaints relating to accounting. In addition, the Company is
in the process of implementing its regulatory compliance strategic plan relating
its IT infrastructure in order to establish and maintain an adequate internal
control structure and procedures for financial reporting, Except as set forth
above, the Company is in compliance with all applicable requirements of the
Xxxxxxxx-Xxxxx Act of 2002 that are effective as of the date hereof, and any and
all applicable rules and regulations promulgated by the SEC thereunder that are
effective as of the date hereof .
(ff) Internal Accounting and Disclosure Controls. Except as set forth on
Schedule 7(ff), the Company and each of its Subsidiaries maintain a system of
internal accounting controls sufficient to provide reasonable assurance that (i)
transactions are executed in accordance with management's general or specific
authorizations, (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain asset and liability accountability, (iii)
access to assets or incurrence of liabilities is permitted only in accordance
with management's general or specific authorization and (iv) the recorded
accountability for assets and liabilities is compared with the existing assets
and liabilities at reasonable intervals and appropriate action is taken with
respect to any difference. Except as set forth on Schedule 7(ff), the Company
maintains disclosure controls and procedures (as such term is defined in Rule
13a-14 under the 1934 Act) that are effective in ensuring that information
required to be disclosed by the Company in the reports that it files or submits
under the 1934 Act is recorded, processed, summarized and reported, within the
18
time periods specified in the rules and forms of the SEC, including, without
limitation, controls and procedures designed in to ensure that information
required to be disclosed by the Company in the reports that it files or submits
under the 1934 Act is accumulated and communicated to the Company's management,
including its principal executive officer or officers and its principal
financial officer or officers, as appropriate, to allow timely decisions
regarding required disclosure.
8. Indemnification. In consideration of the Investor's execution and
delivery of the Transaction Documents and acquiring the Notes and Warrants
thereunder and in addition to all of the Company's other obligations under the
Transaction Documents, the Company shall defend, protect, indemnify and hold
harmless each Investor and each other holder of the Notes and Warrants and all
of their stockholders, partners, members, officers, directors, employees and
direct or indirect investors and any of the foregoing Persons' agents or other
representatives (including, without limitation, those retained in connection
with the transactions contemplated by this Agreement) (collectively, the
"Indemnitees") from and against any and all actions, causes of action, suits,
claims, losses, costs, penalties, fees, liabilities and damages, and expenses in
connection therewith (irrespective of whether any such Indemnitee is a party to
the action for which indemnification hereunder is sought), and including
reasonable attorneys' fees and disbursements (the "Indemnified Liabilities"),
incurred by any Indemnitee as a result of, or arising out of, or relating to (a)
any misrepresentation or breach of any representation or warranty made by the
Company in the Transaction Documents or any other certificate, instrument or
document contemplated hereby or thereby, (b) any breach of any covenant,
agreement or obligation of the Company contained in the Transaction Documents or
(c) any cause of action, suit or claim brought or made against such Indemnitee
by a third party (including for these purposes a derivative action brought on
behalf of the Company) and arising out of or resulting from (i) the execution,
delivery, performance or enforcement of the Transaction Documents, (ii) any
transaction financed or to be financed in whole or in part, directly or
indirectly, with the proceeds of the issuance of the Securities, (iii) any
disclosure made by such Investor pursuant to Section 9(c) or (iv) the status of
such Investor or holder of the Securities as an investor in the Company pursuant
to the transactions contemplated by the Transaction Documents. To the extent
that the foregoing undertaking by the Company may be unenforceable for any
reason, the Company shall make the maximum contribution to the payment and
satisfaction of each of the Indemnified Liabilities that is permissible under
applicable law.
Promptly after receipt by an Indemnitee under this Section 8 of notice of
the commencement of any action or proceeding (including any governmental action
or proceeding) involving an Indemnified Liability, such Indemnitee shall, if a
claim for indemnification in respect thereof is to be made against any
indemnifying party under this Section 8, deliver to the indemnifying party a
written notice of the commencement thereof, and the indemnifying party shall
have the right to participate in, and, to the extent the indemnifying party so
desires, jointly with any other indemnifying party similarly noticed, to assume
control of the defense thereof with counsel mutually satisfactory to the
indemnifying party and the Indemnitee; provided, however, that an Indemnitee
shall have the right to retain its own counsel with the fees and expenses of not
more than one counsel for such Indemnitee to be paid by the indemnifying party,
if, in the reasonable opinion of the Indemnitee, the representation by such
counsel of the Indemnitee and the indemnifying party would be inappropriate due
to actual or potential differing interests between such Indemnitee and any other
19
party represented by such counsel in such proceeding. Legal counsel referred to
in the immediately preceding sentence shall be selected by the Investors holding
at least a majority of the Securities issued and issuable hereunder. The
Indemnitee shall cooperate fully with the indemnifying party in connection with
any negotiation or defense of any such action or Indemnified Liabilities by the
indemnifying party and shall furnish to the indemnifying party all information
reasonably available to the Indemnitee that relates to such action or
Indemnified Liabilities. The indemnifying party shall keep the Indemnitee fully
apprised at all times as to the status of the defense or any settlement
negotiations with respect thereto. No indemnifying party shall be liable for any
settlement of any action, claim or proceeding effected without its prior written
consent, provided, however, that the indemnifying party shall not unreasonably
withhold, delay or condition its consent. No indemnifying party shall, without
the prior written consent of the Indemnitee, which consent shall not be
unreasonably withheld conditioned or delayed, consent to entry of any judgment
or enter into any settlement or other compromise which (i) does not include as
an unconditional term thereof the giving by the claimant or plaintiff to such
Indemnitee of a release from all liability in respect to such Indemnified
Liabilities or litigation, (ii) requires any admission of wrongdoing by such
Indemnitee, or (iii) obligates or requires an Indemnitee to take, or refrain
from taking, any action. Following indemnification as provided for hereunder,
the indemnifying party shall be subrogated to all rights of the Indemnitee with
respect to all third parties, firms or corporations relating to the matter for
which indemnification has been made. The failure to deliver written notice to
the indemnifying party within a reasonable time of the commencement of any such
action shall not relieve such indemnifying party of any liability to the
Indemnitee under this Section 8, except to the extent that the indemnifying
party is prejudiced in its ability to defend such action.
The indemnification required by this Section 8 shall be made by periodic
payments of the amount thereof during the course of the investigation or
defense, as and when bills are received or Indemnified Liabilities are incurred.
The indemnity agreements contained herein shall be in addition to (x) any
cause of action or similar right of the Indemnitee against the indemnifying
party or others, and (y) any liabilities the indemnifying party may be subject
to pursuant to the law.
9. Covenants. The Company covenants and agrees for the benefit of the
Investor to abide by the following terms and conditions:
(a) As long as the Investor owns Securities, the Company covenants to
timely file (or obtain extensions in respect thereof and file within
the applicable grace period) all reports required to be filed by the
Company (the "Reports") after the date hereof pursuant to the
Securities Exchange Act of 1934, as amended, and the rules and
regulations promulgated thereunder (the "Exchange Act"). In addition
to such Investor's other available remedies, the Company shall pay to
Investor, in cash, as liquidated damages and not as a penalty, for
each $1,000 of Notes and Warrants held by Investor, $__ per day for
each day the Company fails to timely file any Report.
20
(b) The Company shall as soon as practicable following the execution of
this Agreement (and in any event with three (3) Business Days of the
Closing), deliver the original stock certificates representing all of
the Capital Stock of the Company's Subsidiary, accompanied by an
undated stock power executed in blank and other proper instruments of
transfer
(c) The Company shall as soon as practicable following the execution of
this Agreement (and in any event within four (4) Business Days of the
Closing) issue a Current Report on Form 8-K, disclosing the material
terms of the transactions contemplated by the Transaction Documents in
the form required by the Securities Exchange Act of 1934, as amended
and attaching the material transaction documents (including, without
limitation, this Agreement, the form of Note, the form of Warrant, the
form of Registration Rights Agreement and the Form of Security
Agreement ) as exhibits to such filing. The Company shall not issue
any press release or otherwise make any such public statement
identifying the Investor without the prior consent of the Investor,
except if such disclosure is required by law, in which case the
Company shall promptly provide the Investor with prior notice of such
public statement or communication. Notwithstanding the foregoing, the
Company shall not publicly disclose the name of any Investor, or
include the name of any Investor in any filing with the Commission (to
the extent required) or any regulatory agency or trading market,
without the prior written consent of such Investor, except (i) as
required by federal securities law in connection with (A) any
registration statement contemplated by the Registration Rights
Agreement and (B) the filing of final Offering Documents (including
signature pages thereto) with the Commission and (ii) to the extent
such disclosure is required by law or trading market regulations, in
which case the Company shall, where practicable, provide the Investor
with prior notice of such disclosure. As used herein, "Business Day"
means any day other than Saturday, Sunday or other day on which
commercial business in the City of New York are authorized or required
by law to remain closed.
(d) From and after the filing of the 8-K Filing with the SEC, no Investor
shall be in possession of any material, nonpublic information received
from the Company, any of its Subsidiaries or any of their respective
officers, directors, employees or agents, that is not disclosed in the
8-K Filing. The Company shall not, and shall cause each of its
Subsidiaries and its and each of their respective officers, directors,
employees and agents, not to, provide any Investor with any material,
nonpublic information regarding the Company or any of its Subsidiaries
from and after the filing of the 8-K Filing with the SEC without the
express written consent of such Investor. If Investor has, or believes
it has, received any such material, nonpublic information regarding
the Company or any of its Subsidiaries, it shall provide the Company
with written notice thereof. The Company shall, within two (2) trading
days of receipt of such notice, make public disclosure of such
material, nonpublic information. In the event of a breach of the
foregoing covenant by the Company, any of its Subsidiaries, or any of
its or their respective officers, directors, employees and agents, in
addition to any other remedy provided herein or in the Transaction
21
Documents, an Investor shall have the right to make a public
disclosure, in the form of a press release, public advertisement or
otherwise, of such material, nonpublic information without the prior
approval by the Company, its Subsidiaries or any of its or their
respective officers, directors, employees or agents. No Investor shall
have any liability to the Company, its Subsidiaries, or any of its or
their respective officers, directors, employees, stockholders or
agents for any such disclosure.
(e) As long as the Investor has any Notes outstanding, the Company will
not issue any Notes other than to the Investors as contemplated hereby
and the Company shall not issue any other securities that would cause
a breach or default under the Notes. For so long as any Notes or
Warrants remain outstanding, the Company shall not, in any manner,
issue or sell any rights, warrants or options to subscribe for or
purchase Common Stock or directly or indirectly convertible into or
exchangeable or exercisable for Common Stock at a price which varies
or may vary with the market price of the Common Stock, including by
way of one or more reset(s) to any fixed price unless the conversion,
exchange or exercise price of any such security cannot be less than
the then applicable Conversion Price (as defined in the Notes) with
respect to the Common Stock into which any Note is convertible or the
then applicable Exercise Price (as defined in the Warrants) with
respect to the Common Stock into which any Warrant is exercisable.
(f) The Company shall, as soon as practicable following the execution of
this Agreement, but in any event within six (6) months of the Closing,
be in compliance with all applicable requirements of the
Xxxxxxxx-Xxxxx Act of 2002 that are effective as of the date thereof,
and any and all applicable rules and regulations promulgated by the
SEC thereunder that are effective as of the date thereof.
(g) As soon as practicable following the execution of this Agreement, but
in any event within six (6) months of the Closing, the Company and
each of its Subsidiaries shall maintain a system of internal
accounting controls sufficient to provide reasonable assurance that
(i) transactions are executed in accordance with management's general
or specific authorizations, (ii) transactions are recorded as
necessary to permit preparation of financial statements in conformity
with generally accepted accounting principles and to maintain asset
and liability accountability, (iii) access to assets or incurrence of
liabilities is permitted only in accordance with management's general
or specific authorization and (iv) the recorded accountability for
assets and liabilities is compared with the existing assets and
liabilities at reasonable intervals and appropriate action is taken
with respect to any difference. As soon as practicable following the
execution of this Agreement, but in any event within six (6) months of
the Closing, the Company shall maintain disclosure controls and
procedures (as such term is defined in Rule 13a-14 under the 1934 Act)
that are effective in ensuring that information required to be
disclosed by the Company in the reports that it files or submits under
the 1934 Act is recorded, processed, summarized and reported, within
22
the time periods specified in the rules and forms of the SEC,
including, without limitation, controls and procedures designed in to
ensure that information required to be disclosed by the Company in the
reports that it files or submits under the 1934 Act is accumulated and
communicated to the Company's management, including its principal
executive officer or officers and its principal financial officer or
officers, as appropriate, to allow timely decisions regarding required
disclosure.
10. Participation in Future Financing.
(a) From the date hereof until the date when all Conversion Shares and
Warrant Shares are freely tradeable without the requirement to be in
compliance with Rule 144(c)(1) and otherwise without restriction or
limitation pursuant to Rule 144 (the "Trigger Date"), the Company will
not, directly or indirectly, file any registration statement with the
SEC other than the Registration Statement (as defined in the
Registration Rights Agreement). From the date hereof until the Trigger
Date, the Company will not, (i) directly or indirectly, offer, sell,
grant any option to purchase, or otherwise dispose of (or announce any
offer, sale, grant or any option to purchase or other disposition of)
any of its or its Subsidiaries' equity or equity equivalent
securities, including without limitation any debt, preferred stock or
other instrument or security that is, at any time during its life and
under any circumstances, convertible into or exchangeable or
exercisable for shares of Common Stock or Common Stock Equivalents
(any such offer, sale, grant, disposition or announcement being
referred to as a "Subsequent Financing") or (ii) be party to any
solicitations, negotiations or discussions with regard to the
foregoing.
(b) From the date hereof until the date that is the 24 month anniversary
of the Closing Date), Company will not, directly or indirectly, effect
any Subsequent Placement unless the Company shall have first complied
with this Section 10. Each Investor shall have the right to
participate in up to an amount of the Subsequent Financing equal to
Investor's (a) pro rata portion of the aggregate principal amount of
Notes and Warrants purchased hereunder (the "Basic Amount"), and (b)
with respect to each Investor that elects to purchase its Basic
Amount, any additional portion of the securities being offered (the
"Offered Securities") Offered Securities attributable to the Basic
Amounts of other Investors as such Investors shall indicate it will
purchase or acquire should the other Investors subscribe for less than
their Basic Amounts (the "Undersubscription Amount"), which process
shall be repeated until the Investors shall have an opportunity to
subscribe for any remaining Undersubscription Amount ((a) and (b)
together the "Participation maximum").
(c) At least 10 Trading Days prior to the closing of the Subsequent
Financing, the Company shall deliver to each Investor a written notice
of its intention to effect a Subsequent Financing (the "Subsequent
Financing Notice") by registered or certified mail, return receipt
23
requested, hand delivery, overnight mail, Federal Express or other
national overnight next day carrier. The Subsequent Financing Notice
shall describe in reasonable detail the proposed terms of such
Subsequent Financing, the amount of proceeds intended to be raised
thereunder, the person or persons through or with whom such Subsequent
Financing is proposed to be effected, and attached to which shall be a
term sheet or similar document relating thereto.
(d) Any Investor desiring to participate in such Subsequent Financing must
provide written notice to the Company by not later than 5:00 p.m. (New
York City time) on the 5th Trading Day after such Investor has
received the Subsequent Financing Notice that the Investor is willing
to participate in the Subsequent Financing, the amount of the
Investor's participation, and that the Investor has such funds ready,
willing, and available for investment on the terms set forth in the
Subsequent Financing Notice. If the Basic Amounts subscribed for by
all Investors are less than the total of all of the Basic Amounts,
then each Investor who has set forth an Undersubscription Amount in
its notice of acceptance shall be entitled to purchase, in addition to
the Basic Amounts subscribed for, the Undersubscription Amount it has
subscribed for; provided, however, that if the Undersubscription
Amounts subscribed for exceed the difference -------- ------- between
the total of all the Basic Amounts and the Basic Amounts subscribed
for (the "Available Undersubscription Amount"), each Investor who has
subscribed for any Undersubscription Amount shall be entitled to
purchase only that portion of the Available Undersubscription Amount
as the Basic Amount of such Investor bears to the total Basic Amounts
of all Investors that have subscribed for Undersubscription Amounts,
subject to rounding by the Company to the extent its deems reasonably
necessary. Notwithstanding anything to the contrary contained herein,
if the Company desires to modify or amend the terms and conditions of
the Subsequent Financing prior to the expiration of the offer period,
the Company may deliver to the Investors a new Subsequent Financing
Notice and the offer period shall expire on the tenth (10th) Business
Day after such Investor's receipt of such new Subsequent Financing
Notice. If the Company receives no notice from an Investor as of such
5th Trading Day, such Investor shall be deemed to have notified the
Company that it does not elect to participate. .
(e) If by 5:00 p.m. (New York City time) on the 5th Trading Day after all
of the Investors have received the Subsequent Financing Notice,
notifications by the Investors of their willingness to participate in
the Subsequent Financing (or to cause their designees to participate)
is, in the aggregate, less than the total amount of the Subsequent
Financing, then the Company may effect the remaining portion of such
Subsequent Financing on the terms and with the persons set forth in
the Subsequent Financing Notice.
(f) If by 5:00 p.m. (New York City time) on the 5th Trading Day after all
of the Investors in this Offering have received the Subsequent
Financing Notice, the Company receives responses to a Subsequent
Financing Notice from such Investors seeking to purchase more than the
24
aggregate amount of the maximum offering in the Subsequent Financing,
each such Investor shall have the right to purchase their Pro Rata
Portion (as defined below) of the Participation Maximum. "Pro Rata
Portion" is the ratio of (x) the Subscription amount of Securities
purchased on the Closing Date by each Investor participating in this
Offering and (y) the sum of the aggregate subscription amounts of
Securities purchased on the Closing Date by all Investors
participating in this Offering.
11. Transfer Agent Instructions.
The Company shall issue irrevocable instructions to its transfer agent, and
any subsequent transfer agent, to issue certificates or credit shares to the
applicable balance accounts at The Depository Trust Company ("DTC"), registered
in the name of each Investor or its respective nominee(s), for the Conversion
Shares and the Warrant Shares issuable upon conversion of the Notes or exercise
of the Warrants in such amounts as specified from time to time by each Investor
to the Company, including upon conversion of the Notes or exercise of the
Warrants in the form of Exhibit E (the "Irrevocable Transfer Agent
Instructions"). The Company warrants that no instruction other than the
Irrevocable Transfer Agent Instructions referred to in this Section 11, and stop
transfer instructions to give effect to Section 6(k) hereof, will be given by
the Company to its transfer agent, and that the Securities shall otherwise be
freely transferable on the books and records of the Company as and to the extent
provided in this Agreement and the other Transaction Documents. If an Investor
effects a sale, assignment or transfer of the Securities in accordance with
Section 6(k), the Company shall permit the transfer and shall promptly instruct
its transfer agent to issue one or more certificates or credit shares to the
applicable balance accounts at DTC in such name and in such denominations as
specified by such Investor to effect such sale, transfer or assignment. In the
event that such sale, assignment or transfer involves Conversion Shares or
Warrant Shares sold, assigned or transferred pursuant to an effective
registration statement or pursuant to Rule 144, the transfer agent shall issue
such Securities to the Investor, assignee or transferee, as the case may be,
without any restrictive legend. The Company acknowledges that a breach by it of
its obligations hereunder will cause irreparable harm to an Investor.
Accordingly, the Company acknowledges that the remedy at law for a breach of its
obligations under this Section 11 will be inadequate and agrees, in the event of
a breach or threatened breach by the Company of the provisions of this Section
11, that an Investor shall be entitled, in addition to all other available
remedies, to an order and/or injunction restraining any breach and requiring
immediate issuance and transfer, without the necessity of showing economic loss
and without any bond or other security being required.
12. Conditions to the Company's Obligation to Sell. The obligation of the
Company hereunder to issue and sell the Notes and the related Common Shares and
Warrants to each Investor at the Closing is subject to the satisfaction, at or
before the Closing Date, of each of the following conditions, provided that
these conditions are for the Company's sole benefit and may be waived by the
Company at any time in its sole discretion by providing each Investor with prior
written notice thereof:
(i) Such Investor shall have executed each of the Transaction Documents to
which it is a party and delivered the same to the Company.
25
(ii) Such Investor and each other Investor shall have delivered to the
Company the aggregate amount subscribed for the Notes and the related Warrants
being purchased by such Investor at the Closing by wire transfer of immediately
available funds pursuant to the wire instructions provided by the Company.
(iii) The representations and warranties of such Investor shall be true and
correct in all material respects as of the date when made and as of the Closing
Date as though made at that time (except for representations and warranties that
speak as of a specific date which shall be true and correct as of such specified
date), and such Investor shall have performed, satisfied and complied in all
material respects with the covenants, agreements and conditions required by this
Agreement to be performed, satisfied or complied with by such Investor at or
prior to the date of Closing.
13. Conditions To Each Investor's Obligation To Purchase. The obligation of
each Investor hereunder to purchase the Notes and the related Warrants at the
Closing is subject to the satisfaction, at or before the Closing Date, of each
of the following conditions, provided that these conditions are for each
Investor's sole benefit and may be waived by such Investor at any time in its
sole discretion by providing the Company with prior written notice thereof:
(i) The Company shall have duly executed and delivered to such Investor (A)
each of the Transaction Documents and, (B) the Notes (in such principal amounts
as such Investor shall request), being purchased by such Investor at the Closing
pursuant to this Agreement, and (C) the related Warrants (in such amounts as
such Investor shall request) being purchased by such Investor at the Closing
pursuant to this Agreement.
(ii) Such Investor shall have received the opinion of Ruskin Moscou
Xxxxxxxxxx, P.C., dated as of the Closing Date, in substantially the form of
Exhibit F attached hereto.
(iii) The Company shall have delivered to such Investor a copy of the
Irrevocable Transfer Agent Instructions, in the form of Exhibit E attached
hereto, which instructions shall have been delivered to and acknowledged in
writing by the Company's transfer agent.
(iv) The Company shall have delivered to such Investor a certificate
evidencing the formation and good standing of the Company, in such entity's
jurisdiction of formation issued by the Secretary of State (or comparable
office) of such jurisdiction, as of a date within 10 days of the date of
Closing.
(v) The Company shall have delivered to such Investor a certified copy of
the articles of incorporation as certified by the Secretary of State of its
state of incorporation within ten (10) days of the Closing Date.
(vi) The Company shall have delivered to such Investor a certificate,
executed by the Secretary of the Company and dated as of the Closing Date as to
(i) the resolutions authorizing the Transaction Documents as adopted by the
Company's Board of Directors in a form reasonably acceptable to such Investor,
26
(ii) the Articles of Incorporation, and (iii) the Bylaws, each as in effect at
the Closing, in the form attached hereto as Exhibit G.
(vii) The representations and warranties of the Company shall be true and
correct as of the date when made and as of the Closing Date as though made at
that time (except for representations and warranties that speak as of a specific
date which shall be true and correct as of such specified date) and the Company
shall have performed, satisfied and complied in all respects with the covenants,
agreements and conditions required by the Transaction Documents to be performed,
satisfied or complied with by the Company at or prior to the Closing Date. Such
Investor shall have received a certificate, executed by the Chief Executive
Officer of the Company, dated as of the Closing Date, to the foregoing effect
and as to such other matters as may be reasonably requested by such Investor in
the form attached hereto as Exhibit H.
(viii) The Company shall have delivered to such Investor a letter from the
Company's transfer agent certifying the number of shares of Common Stock
outstanding as of a date within five days of the Closing Date.
(ix) The Common Stock (i) shall be designated for quotation or listed on
FINRA's OTC Bulletin Board (the "Principal Market") and (ii) shall not have been
suspended, as of the Closing Date, by the SEC or the Principal Market from
trading on the Principal Market nor shall suspension by the SEC or the Principal
Market have been threatened, as of the Closing Date, either (a) in writing by
the SEC or the Principal Market or (b) by falling below the minimum listing
maintenance requirements of the Principal Market.
(x) The Company shall have obtained all governmental, regulatory or third
party consents and approvals, if any, necessary for the sale of the Securities,
except for such consents and approvals as are contemplated to be obtained
following the date of Closing.
(xii) the Security Agreement shall have been duly executed by the Company,
each Investor and the Agent (as defined in the Security Agreement) and delivered
to the Agent.
(xiii) The Company shall have delivered to such Investor such other
documents relating to the transactions contemplated by this Agreement as such
Investor or its counsel may reasonably request.
12. Severability. If any term, provision, covenant or restriction of this
Agreement is held by a court of competent jurisdiction to be invalid, illegal,
void or unenforceable, the remainder of the terms, provisions, covenants and
restrictions set forth herein shall remain in full force and effect and shall in
no way be affected, impaired or invalidated, and the parties hereto shall use
their commercially reasonable efforts to find and employ an alternative means to
achieve the same or substantially the same result as that contemplated by such
term, provision, covenant or restriction. It is hereby stipulated and declared
to be the intention of the parties that they would have executed the remaining
terms, provisions, covenants and restrictions without including any of such that
may be hereafter declared invalid, illegal, void or unenforceable.
27
13. 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 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 and 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.
14. 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.
15. Benefit. This Subscription Agreement shall be binding upon and inure to
the benefit of the parties hereto.
16. 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:
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: Perf-Go Green Holdings, Inc.
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
with a copy to: Xxxx X. Xxxxxxx, Esq.
Ruskin Moscou Faltischek, P.C.
28
0000 XxxXxxx Xxxxx
Xxxxxxxxx, Xxx Xxxx 00000
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.
17. 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.
18. 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.
19. Survival of Representations, Warranties and Agreements. The
representations, warranties and agreements contained herein shall survive the
delivery of, and the payment for, the Securities.
29
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
PERF-GO GREEN HOLDINGS, INC.
Dated: _____, 2008 By: _______________________________
Name:______________________________
Title:_____________________________
30
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)
31
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.
Exhibit E
---------
Form of Irrevocable Transfer Agent Instructions
See Attached.
Exhibit F
---------
Form of Legal Opinion
See Attached.
Exhibit G
---------
Form of Secretary's Certificate
See Attached.
Exhibit G
---------
Form of Officer's Certificate
See Attached.
