Exhibit 10.1
[Form of Subscription Agreement]
Elcom International, Inc.
00 Xxxxxx Xxx
Xxxxxxx, XX 00000
The Directors
Xxxxx & Xxxxxxxxxx Investment Management Limited
00 Xxxxxxxx, Xxxxxx XX0X 0XX
Xxxxxx Xxxxxxx
[ ] October 2006
Dear Sirs
Subscription of [__________] new shares of common stock, par value $0.01 per share ("Shares") in Elcom International,
Inc. at 1.75p per share (the "Subscription")
1 Subscription
1.1 In reliance upon the warranties, representations and covenants set forth in the paragraphs below, you have
applied for the allotment and issue to you pursuant to Regulation S ("Regulation S") under the United States
Securities Act of 1933, as amended (the "US Securities Act") of [ ] Shares (the "Subscription Shares")
in Elcom International, Inc. ("Elcom" or the "Company") at a price of 1.75p per Subscription Share (the
"Subscription Price") on and subject to the terms set out in this letter.
1.2 The subscription for the Subscription Shares by you shall be made conditional upon the admission ("Admission") of
such shares to AIM, a market operated by London Stock Exchange plc ("AIM"), becoming effective in accordance with
the rules for AIM ("AIM Rules") published by London Stock Exchange.
1.3 The Subscription Shares will be issued credited as fully paid subject to the terms and conditions of the
certificate of incorporation and by-laws of Elcom and the terms of this letter and on issue will rank pari passu
in all respects with the existing issued shares of common stock in the capital of the Company.
1.4 You represent and warrant to us that in agreeing to subscribe for the Subscription Shares you have relied only on
publicly available information relating to Elcom and that you have not relied on any warranty or representation
made by Elcom, or any of its directors, employees, agents or advisers save for any given in this letter.
1.5 Application will be made no later than 30 October 2006 for the Subscription Shares to be admitted to AIM. It is
expected that Admission will become effective no later than 3 November 2006.
1.6 You agree that, without us having any liability to you we may, in our absolute discretion, exercise the right to
terminate the Subscription without consulting you. If Admission has not become effective on or before 8.00 a.m.
on 24 November 2006 your rights and obligations hereunder will cease and determine at such time, and any moneys
transferred to Xxxxx & Xxxxxxxxxx Investment Management Limited ("SWIM") pursuant to paragraph 3.1 in respect
of the Subscription will be returned to you, without interest, and no claims may be made against us in respect
thereof following receipt by you of such monies in cleared funds.
1.7 In sending this subscription letter we are relying on your being either an "investment professional" within the
meaning of Article 19(5) of the Financial Services and Markets Xxx 0000 (Financial Promotion) Order 2005 or a
company of a kind described in Article 49(2) of that Order or a person to whom this subscription letter may
otherwise be sent lawfully without infringing the general restriction set out in section 21 of the Financial
Services and Markets Xxx 0000 ("FSMA"). It is further sent on the understanding that you acknowledge for the
purposes of FSMA that past performance is not a guide to future performance.
2 Confirmations
2.1 You confirm, represent, warrant and undertake with Elcom:
2.1.1 to subscribe for the Subscription Shares on the terms of this letter and to pay the Subscription Price;
2.1.2 that save as expressly provided in this letter, your obligations are irrevocable and shall not be capable of
rescission or termination by you in any circumstances;
2.1.3 that you are not resident in Canada, Japan or Australia or a "US person" (within the meaning of Rule 902(k) under
Regulation S) and are not acting for the account or benefit of a US person (other than a distributor);
2.1.4 that you are entitled to subscribe for the Subscription Shares under the laws of the United Kingdom which apply
to you and that you have fully observed such laws and complied with all necessary formalities;
2.1.5 that you are either an "investment professional" within the meaning of Article 19(5) of the Financial Services
and Markets Xxx 0000 (Financial Promotion) Order 2005 or a company of a kind described in Article 49(2) of that
Order or a person to whom this subscription letter may otherwise be sent lawfully without infringing the
general restriction in section 21 of FSMA and either you will acquire, manage or dispose of the Subscription
Shares (as principal or agent) for the purposes of your business and that you are purchasing under the exemption
provided by Regulation S;
2.1.6 that the Subscription Shares will not for a period of one year after Admission be offered, resold, pledged or
otherwise transferred by you (a "relevant transaction") except: (i) in an "offshore transaction" (within the
meaning of Rule 902(h) under Regulation S) meeting the requirements of Rule 903 or Rule 904 of Regulation S,
(ii) pursuant to an effective registration statement filed under the US Securities Act, or(iii) if the registration
requirements of the US Securities Act would otherwise apply to the relevant transaction, pursuant to a relevant
exemption from the registration requirements of that Act and otherwise in accordance with all applicable federal
and state securities laws of the United States;
2.1.7 that you will notify any purchaser of the Subscription Shares from you of the resale restrictions referred to in
paragraph 2.1.6 above, if then applicable;
2.1.8 that, in any proposed transfer of Subscription Shares by you (other than pursuant to an effective registration
statement filed under the US Securities Act), you acknowledge that the transferee of the Subscription Shares may,
if so required in order to ensure compliance with the US Securities Act, be obliged to provide certifications
and other documentation relating to the non-US person status of such transferee and such other agreement and
documentation as may be reasonably required by the Company or its transfer agent;
2.1.9 that you acknowledge that the Subscription Shares will bear a restrictive legend to the effect that transfers of
the Subscription Shares are prohibited except in accordance with the requirements of Regulation S, pursuant
to an effective registration statement filed under the US Securities Act, or pursuant to an available exemption
from registration and that hedging transactions involving Subscription Shares may not be conducted except in
compliance with the US Securities Act, unless the Company determines otherwise in compliance with applicable
US law; and
2.1.10 that you are not otherwise resident in any other territory in which it is unlawful to make an offer to subscribe
for Subscription Shares or to reply to this letter.
2.2 You further represent, warrant and undertake to Elcom and acknowledge that:
2.2.1 you are aware of, and have complied with, any obligations you have under the Criminal Justice Xxx 0000 and
section 118 of FSMA, to the extent applicable to you in relation to the Company and the Subscription Shares;
2.2.2 you are aware of the Company's business affairs and financial condition, and have acquired sufficient information
about the Company to reach an informed and knowledgeable decision to acquire Shares; you will be acquiring
the Subscription Shares for your own account as principal or for a discretionary account or accounts (as to which
you have the authority to make and do make the statements in this subscription letter)for investment purposes only;
2.2.3 you agree to comply with any applicable rules and regulations of AIM, the US Securities and Exchange Commission
and applicable US state securities laws; and
2.2.4 this subscription letter and the enclosed form of confirmation is, and any contract which may be entered into
between you and ourselves pursuant hereto shall be, governed by and construed in accordance with the laws of
England and that you submit to the exclusive jurisdiction of the English Courts as regards any claim, dispute
or matter arising out of or related to this subscription letter or such contract.
3 Payment and settlement
3.1 You will be required to arrange payment of the aggregate Subscription Price for value to the following account of
SWIM by no later than the close of business on the business day after the date of this letter:
Bank: Royal Bank of Scotland plc
Branch: London City Office
Sort Code: 15-10-00
Account No: 00000000
A/C name: Xxxxx & Xxxxxxxxxx Investment Management Limited
Ref: Elcom
Subject to Admission becoming effective no later than 8.00am on 24 November 2006, SWIM is authorised by you to
pay the monies due on account of the Subscription Price for value to the account of Elcom Systems Limited at
National Westminster Bank plc, Slough branch, sort code 60-19-28, account number 00000000 not later than the
business day after Admission. If, for any reason, Admission has not become effective prior to 8.00am on 24
November 2006, the Subscription will not be effected and shall be terminated and any monies paid in respect
of the Subscription Shares will be refunded, without interest, in accordance with paragraph 1.6.
For the avoidance of doubt Xxxxx & Xxxxxxxxxx Corporate Finance Limited which is regulated in the United Kingdom
by the Financial Services Authority, is acting exclusively as nominated adviser to Elcom for the purposes of the
AIM Rules to the Company and is not acting for any other person in connection with the matters described in this
document and will not therefore be responsible to any other person for providing the protections afforded to
customers of Xxxxx & Xxxxxxxxxx Corporate Finance Limited or advising in connection with the matters described
in this document.
3.2 A certificate or certificates in respect of the Subscription Shares issued in certificated form for each of the
account designations notified by you prior to allotment will be delivered to you as soon as practicable after
Admission.
4 Money laundering
4.1 It is a term of the agreement evidenced by this subscription letter that, to ensure compliance with the Money
Laundering Regulations 2003, SWIM may, in its absolute discretion, require verification of your identity to the
extent that you have not already provided the same. Pending the provision to SWIM of evidence (if so requested)
of identity, definitive certificates for the Subscription Shares may be retained/delayed at our absolute
discretion. If within a reasonable time after a request for verification of identity SWIM have not received
satisfactory evidence, we may, in our absolute discretion terminate your commitment in which event the monies
payable on acceptance of the allotment will, if paid, be returned without interest to the account of the drawee
bank from which they were originally debited.
5 Representations of Elcom
In consideration of the subscription for the Subscription Shares by you, the Company represents, warrants and undertakes
with you in the terms set forth below:
5.1 the Company is a corporation duly organized, validly existing and in good standing under the laws of the State of
Delaware and has all requisite corporate power and authority to carry on its business as presently conducted and
as proposed to be conducted;
5.2 the authorised capital stock of the Company consists of (and will consist of immediately prior to Admission)
700,000,000 shares of common stock, of which 402,080,443 are issued and outstanding as of the date of this
subscription letter, and 10,000,000 shares of preferred stock, none of which are issued and outstanding as of the
date of this subscription letter. All of the outstanding Shares have been duly authorised, are fully paid and
non-assessable and were issued in compliance with all applicable US federal and state securities laws.
5.3 the execution of this subscription letter has been duly and validly authorized by all necessary corporate action
on the part of the Company;
5.4 the issuance by the Company of the Subscription Shares pursuant to this subscription letter will not conflict
with any borrowing limits, powers or restrictions of, or the terms of any contract, agreement, security,
obligation or commitment or arrangement by which the Company is bound or to which any of its properties, revenues
or assets is subject, or result in the imposition of any rights upon any assets of the Company or the violation
of any obligations of the Company under any such contract, agreement, security, obligation or commitment or
arrangement;
5.5 the Subscription Shares, together with all rights attaching thereto, when issued in accordance with the terms of
this subscription letter, will be issued free and clear of all liens, charges and encumbrances; and
5.6 save insofar as any matters that will be fully rectified by completion of your subscription for the Subscription
Shares and the receipt of the monies, the Company has not taken any action, nor have any other steps been taken
or legal proceedings started or threatened against the Company for its winding-up or dissolution, or for the
Company to enter into any arrangement or composition for the benefit of creditors, or for the appointment of a
receiver and/or manager, trustee or similar officer of the Company in any jurisdiction or of its interests,
properties, revenues or assets and no distress, execution or other similar process has been commenced or
undertaken in respect of the Company in any jurisdiction.
Yours faithfully
for and on behalf of
ELCOM INTERNATIONAL, INC.
[FORM OF CONFIRMATION ]
To:
The Directors
Elcom International, Inc.
00 Xxxxxx Xxx
Xxxxxxx, XX 00000
Dear Sirs
Subscription of [ ] new shares of common stock, par value $0.01 per share, in Elcom International, Inc. at 1.75p
per share (the "Subscription Shares")
We hereby irrevocably undertake and agree to subscribe for the Subscription Shares on the terms and conditions set out in
your letter of [18] October 2006 (the "Subscription Letter") the terms and conditions of which, and the defined terms
used therein, are, by reference, incorporated into this form of confirmation.
In particular (but without limitation) we confirm that in agreeing to subscribe for the Subscription Shares we have
relied only on publicly available information relating to Elcom and that we have not relied on any warranty or
representation made by Elcom, or any of its directors, employees, agents or advisers save for any given in the
Subscription Letter. We confirm that in applying for the Subscription Shares we are able to give the confirmations,
undertakings, representations and warranties set out in the Subscription Letter. We also confirm that we have obtained
all necessary consents to enable us to subscribe for the Subscription Shares and to perform our obligations specified in
the Subscription Letter. We confirm that we will provide you with such information as you may require in order to comply
with your obligations under the Money Laundering Regulations 2003.
Yours faithfully
...................................................
for and on behalf of
Xxxxx & Xxxxxxxxxx Investment Management Limited
Dated: 2006
The registration details for the Subscription Shares are set out below:
Registered name: ......................................................................
Registered address: ......................................................................
......................................................................
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