Exhibit 100.1
SYNERGY BRANDS INC.
UNITS CONSISTING OF
ONE SHARE OF UNREGISTERED, SERIES A CLASS B PREFERRED STOCK
(THE "PREFERRED SHARES")
AND
ONE SHARE OF UNREGISTERED RESTRICTED COMMON STOCK
(THE "COMMON STOCK")
(TOGETHER THE "SECURITIES")
(SUBJECT TO ADJUSTMENT AS HEREINAFTER SET FORTH HEREIN)
SUBSCRIPTION AGREEMENT
SYNERGY BRANDS INC.
0000 Xxxx Xxxxxxx Xxxx
Xxxxxxxx, XX 00000
Gentlemen:
THE SECURITIES SUBSCRIBED FOR HEREIN HAVE NOT BEEN REGISTERED WITH THE UNITED
STATES SECURITIES AND EXCHANGE COMMISSION UNDER THE U.S. SECURITIES ACT OF 1933,
AS AMENDED (THE "ACT"), OR THE SECURITIES COMMISSION OF ANY STATE UNDER ANY
STATE SECURITIES LAW. THEY ARE BEING OFFERED PURSUANT TO AN EXEMPTION FROM
REGISTRATION UNDER SECTION 4(2). THE SECURITIES MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED UNLESS THE SECURITIES ARE REGISTERED UNDER THE ACT AND
APPLICABLE STATE SECURITIES LAWS, OR SUCH OFFERS, SALES AND TRANSFERS ARE MADE
PURSUANT TO AVAILABLE EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF THOSE
LAWS.
THIS SUBSCRIPTION AGREEMENT DOES NOT CONSTITUTE AN OFFER TO SELL, OR A
SOLICITATION OF AN OFFER TO BUY, ANY OF THE SECURITIES OFFERED HEREBY BY OR TO
ANY PERSON IN ANY JURISDICTION IN WHICH SUCH OFFER OF SOLICITATION WOULD BE
UNLAWFUL. INVESTMENT IN THESE SECURITIES INVOLVES A HIGH DEGREE OF RISK. IN
MAKING AN INVESTMENT DECISION, INVESTORS MUST RELY ON THEIR OWN EXAMINATION OF
THE COMPANY AND THE TERMS OF THE OFFERING, INCLUDING THE MERITS AND THE RISKS
INVOLVED. THESE SECURITIES HAVE NOT BEEN RECOMMENDED BY ANY FEDERAL OR STATE
SECURITIES COMMISSION OR REGULATORY AUTHORITY. FURTHERMORE, THE FOREGOING
AUTHORITIES HAVE NOT CONFIRMED OR DETERMINED THE ACCURACY OR ADEQUACY OF THIS
DOCUMENT. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
DESCRIPTION OF SECURITIES:
Units of, one share of Series A Class B Preferred Stock, $ .001 par
value, with preferences rights, and limitations as set forth in the Certificate
of Designation, Preferences, Rights and Limitations of Series A Class B
Preferred Stock (as to 500,000 shares designated as Series A of presently
authorized yet unissued Class B Preferred Stock) (the "Certificate of
Designation"), and one shares of Common Stock, $.001 Par Value, of the Company,
the Units being hereinafter referred to as the "Securities" are being offered by
the Company and subscription therefor evidenced by this Subscription Agreement
(subject to adjustment as hereinafter set forth herein).
1. Subscription. The undersigned hereby irrevocably applies to
SYNERGY BRANDS INC. (the "Company") to purchase 80,000 Units, at a purchase
price of $10.00 per Unit. This subscription may be rejected by the Company in
its sole discretion. The undersigned understands that issuance of the Units
cannot be accomplished by the Company unless and until the aforementioned
Certificate of Designation has been filed with the State of Delaware Secretary
of State Office and that at the execution date of this Subscription Agreement
such filing may not have been accomplished but that none of the subscription
funds may be recorded on the financial reports of the Company nor utilized by
the Company until such filing has been accomplished and until such filing is
accomplished the said subscription funds shall be segregated within the
financial accounts of the Company and be returnable to and at the written
request of the Subscriber if such filing has not occurred within 30 days of the
execution of this Subscription Agreement and thereafter be returnable unless
such filing has occurred before Company receipt of such written nonce with
interest accruing on and after such 30 days at an annual rate of 10%,
2. Amount and Method of Subscription. The undersigned hereby
subscribes for the purchase of 80,000 Units, as fully described below and
encloses a check or has wired payment for the full amount subscribed to the
Company, to the address or wire transfer set forth in the annexed Instructions.
Cost Per Unit $ 10.00
Number of Units Subscribed: 80,000
Total Amount of Subscription: $800,000
The undersigned understands that before his subscription for these Securities
will be accepted, he must have completed, executed, and returned to the Company,
the following:
(i) This Subscription Agreement; and
(ii) The Confidential Prospective Purchaser Questionnaire
attached to this Subscription Agreement
The undersigned further agrees that this subscription is and shall be
irrevocable, but the obligations hereunder will terminate if this subscription
is not accepted by the Company, in whole or in part. Upon acceptance, the
subscriber, along with the other purchasers in this offering (the "Offering"),
are referred to as "Investors".
3. Acceptance by Company. The undersigned understands that the
Company will notify him whether the subscription has been accepted or rejected,
in whole or in part; provided, however, the Company may only reject the
subscription of the undersigned in part as long as such subscription is accepted
in respect of not less than one-half of all Units sold in the Offering. Subject
to the previous sentence, it is understood that the Company shall have the sole
discretion to determine which of the subscriptions of other investors in the
Offering should be rejected, in whole or in part. In the event this subscription
is rejected by the Company, all forms and documents tendered by the undersigned
shall be promptly returned, without deduction or interest.
The Securities being sold and purchased hereby have not been registered
under the Act or the securities laws of any state. The Investor represents and
warrants the Securities are being purchased for investment purposes and not with
a view to distribution or resale, nor with the intention of selling,
transferring or otherwise disposing of all or any part of such Securities for
any particular price, or at any particular time, or upon the happening of any
particular event or circumstance, except selling, transferring, or disposing of
said Securities made in full compliance with all applicable provisions of the
Act, the Rules and Regulations promulgated by the Securities and Exchange
Commission (the "Commission") thereunder, and applicable state securities laws.
The Investor agrees that such Securities must be held indefinitely unless they
are subsequently registered under the Act, or an exemption from such
registration is available, and the Company will require an opinion of counsel
reasonably satisfactory to the Company that registration is not required under
the Act or such state securities laws, and the certificates to be issued will
bear a legend indicating that transfer of the Securities have not been so
registered and the legend may bear the following or similar words:
The Securities represented by this Certificate have not been
registered under the Securities Act of 1933, as amended. These
Securities have been acquired for investment purposes and not
with a view to distribution or resale, and may not be sold,
assigned, pledged, hypothecated or otherwise transferred
without an effective Registration Statement for such
Securities under the Securities Act of 1933, as amended, and
applicable state securities laws, or an opinion of counsel
reasonably satisfactory to the Issuer of these Securities to
the effect that registration is not required under such Act or
such state securities laws. All Securities purchased by the
Investor in this Offering may not be re-sold without
registration under the Act or exemption therefrom and no such
registration rights are attached to such Securities.
5. Representations and Warranties of the Subscriber. In
connection with the purchase of the Securities, the undersigned acknowledges
that the Company will rely on the information and on the representations set
forth herein, and the undersigned hereby represents, warrants, agrees and
acknowledges that:
(a) The undersigned has not received any general solicitation or
general advertising regarding the purchase of the Securities nor has been
offered the Securities through any intervening broker or public solicitation;
(b) The undersigned has been given access to all forms, reports
and documents filed by the Company with the Commission pursuant to the Act and
the Securities Exchange Act of 1934, as amended (the "Exchange Act")
(hereinafter the "Company Reports"), including without limitation the Company's
Report on Form 10-KSB for the fiscal year ended December 31, 2002 and the
Company's Reports on Form 10-QSB for the quarterly periods ended March 31 and
June 30, 2003 and has carefully read and understands all information contained
in this Subscription Agreement, and has relied only on the information contained
therein and herein, in making his subscription hereunder.
(c) The undersigned is an "accredited investor" as that term is
defined under Section 501 (a) of the Rules and Regulations of the Commission
and in this Subscription Agreement.
(d) The undersigned has sufficient knowledge and experience in
financial and business matters so that he or it is able to evaluate the merits
and risks of purchasing the Securities and the undersigned has had substantial
experience in previous private and public purchases of securities;
(e) The undersigned either (i) has a pre-existing personal or
business relationship with the Company or any of its officers, directors, or
controlling persons; or (ii) has business or financial experience (or has
retained the services of a professional advisor who is not affiliated with or
compensated by the Company who has the requisite business or financial
experience) such that the undersigned is capable of protecting his or her own
interests in connection with the proposed purchase of the Securities (for
purposes of this representation, the phrase "preexisting personal or business
relationship" includes any relationship consisting of personal or business
contacts of a nature and duration such as would enable a reasonably prudent
purchaser to be aware of the character, business acumen, and general financial
circumstances of the person with whom such relationship exists);
(f) The undersigned does not require for its liquidity, or other
needs, the funds being used to purchase the Shares, and possesses the ability to
bear the economic risk of holding the Shares purchased hereunder indefinitely,
recognizes that an investment in the Shares involves significant risks and can
afford a complete loss of his or its investment in the Shares.
(g) During the purchase transaction and prior to purchase, the
undersigned has had full opportunity to ask questions of and receive answers
from the Company and its officers and authorized representatives regarding the
terms and conditions of the Offering and the transactions contemplated hereby,
as well as the affairs of the Company and related matters. The undersigned
confirms that it does not desire to receive any further information;
(h) The undersigned has read and understands this Subscription
Agreement, and acknowledges that a restrictive legend, bearing similar words as
set forth in Section 3 of this Subscription Agreement, will be placed upon the
certificates representing the Securities purchased hereunder, and that
instructions will be placed on the Securities and the Company's records for the
Securities prohibiting the transfer of the Securities absent full compliance
with the Act and applicable state securities laws;
(i) The undersigned understands that the purchase price of the
Units and the terms and conditions of the Units being purchased hereby have been
arbitrarily determined and do not necessarily bear any relationship to
investment criteria such as projected earnings, discounted cash flow, book value
or other measures of value;
(j) The undersigned understands that this Subscription Agreement
is subject to the Company's acceptance and may be rejected by the Company at any
time prior to a Closing with respect to the undersigned's subscription, in the
discretion of the Company, notwithstanding prior receipt by the undersigned of
notice of acceptance of the undersigned's subscription;
(k) The undersigned represents that there is no contract,
undertaking, agreement or arrangement with any person to sell, transfer or
pledge to such person or anyone else the Securities or any pan thereof, and the
undersigned has no present plans to enter into any such contract, undertaking,
agreement or arrangement and will neither directly nor indirectly seek to
assign, transfer or sell the same in any way inconsistent with the legend which
is being placed on the certificates representing those Shares;
(1) The undersigned acknowledges that it is not entitled to
cancel, terminate, or revoke the undersigned's subscription;
(m) The undersigned subscriber understands that the Company may
utilize the funds paid for the Securities immediately upon their receipt of same
for valid corporate purposes without further explanation as to use of proceeds.
(n) The undersigned subscriber acknowledges that it has been
advised that the present issuance of the Securities is not being registered
under the Securities Act of 1933, as amended (the "Act"), on the basis of the
statutory exemption thereof, and on the representations made by the Subscriber
herein, and further that the Subscriber is an Accredited Investor as defined
herein and in the applicable Rule 501 et al of Regulation D under the Act, and
Subscriber acknowledges that the Company is and has reserved the right to make
this Offering only to Accredited Investors as so defined. Subscriber has
completed a Confidential Prospective Purchaser Questionnaire and
delivered same to Company along with this Subscription Agreement and confirms
the accuracy of the information provided therein and acknowledges that the
Company is relying on such representations in reviewing and deciding upon this
Subscription.
(o) The undersigned subscriber acknowledges that it is acquiring
the Securities for investment for its own account and not with a view to their
resale or distribution, and that it does not intend to divide its participation
with others or to resell or otherwise dispose of all or any part of such
securities unless and until they are subsequently registered under the Act, or
an exemption from such registration is available.
(p) The undersigned subscriber acknowledges that it understands
that, in the view of the Securities and Exchange Commission (the "Commission"),
the statutory exemption referred to above would not be available, if not
withstanding its representations, it plans merely acquiring the said securities
for resale upon the occurrence or nonoccurrence of some pre-determined event.
(q) The undersigned subscriber acknowledges that it agrees that
all or any part of the said securities sold to it will not be re-sold until they
are subsequently registered or an exemption from registration is available.
(r) The undersigned subscriber acknowledges that it understands in
the event Rule 144 of the Commission hereafter becomes applicable to any of the
said securities, any routine sale of such securities made thereunder can be made
only in limited amounts as prescribed under that Rule and that in case that Rule
is not applicable, compliance with Regulation A or some other disclosure
exemption will be required before it can transfer pan or all of such securities.
However, the Company shall supply it with any information necessary to enable it
to make routine sale of such securities under Rule 144, if applicable.
(s) The undersigned subscriber acknowledges that it has evaluated
the merits and risks of the purchase of the said securities and it is able to
bear the economic risks of such investment; It acknowledges that the Company has
made available to it the opportunity to obtain information to verify and
evaluate the merits and risks of this investment, and that it has had the
opportunity to ask questions of and receive satisfactory answers from the
Company concerning such information which it considered necessary or advisable
to enable it to form a decision concerning its purchase, and that there is no
further information that it desires with respect thereto.
(t) No one acting on behalf of the Company has made any
representation, warranty, or agreement to or with the undersigned Subscriber as
to any of the foregoing with respect to such purchase, except as set forth
herein and/or in the Company's Reports.
(u) Its investment in the Company has not been solicited by means
of public solicitation or advertisement and all of the information and
representations contained in its Confidential Prospective Purchaser
Questionnaire (as requested and completed) are true and correct.
6. The undersigned understands that this Subscription Agreement
has not been filed with or reviewed by the Commission nor the securities
department of any state because of the private or limited nature of this
Offering as defined by applicable laws and that the Securities which are offered
hereunder have not been registered with the Commission under the Act nor with
the securities department of any state in reliance upon an exemption therefrom
for non-public offerings;
7. The Undersigned is a bona fide resident of the state set forth
as his "address" below and further represents that (a) if a corporation,
partnership, trust or other form of business organization, it has a principal
office within such state; and (b) if an individual, he has his principal
residence in such state;
8. All information provided by the Undersigned in the
Confidential Prospective Purchaser Questionnaire which accompanies this
Subscription Agreement is true and accurate in all respects, and the Undersigned
acknowledges that the Company will be relying on such information to its
possible detriment in deciding whether the Undersigned can be sold the Shares
without giving rise to the loss of an exemption from registration under the
applicable securities laws.
9. Special Representations by Institutional Subscribers.
(a) If the subscriber is a TRUST:
(i) The undersigned hereby represents, warrants and
covenants that the trust listed below (the "Trust") is duly organized
and existing and itself has all the requisite authority to purchase the
Securities.
(ii) The undersigned has been duly authorized by all
requisite action on the part of the Trust to act on its behalf in
making such purchase including the execution of this Subscription
Agreement.
(iii) The undersigned represents and warrants that each of
the above representations or agreements or understandings set forth
herein applies to the Trust.
(iv) The Trust (a) has not been formed for me specific
purpose of acquiring the Securities, and (b) qualifies as an accredited
investor under Rule 501 promulgated under the Act or (c) each equity
owner thereof qualifies as an accredited investor and has executed and
delivered simultaneously herewith a Subscription Agreement
substantially identical to this Agreement and a Confidential
Prospective Purchaser Questionnaire.
(b) If the subscriber is a CORPORATION:
(i) The undersigned hereby represents, warrants and
covenants that the corporation listed below (the "Corporation") is duly
organized and existing and itself has all the requisite authority to
purchase the Securities.
(ii) The undersigned has been duly authorized by all
requisite action on the part of the Corporation to act on its behalf in
making such purchase including the execution of this Subscription
Agreement.
(iii) The undersigned represents and warrants that each of
the above representations or agreements or understandings set forth
herein applies to the Corporation.
(iv) The Corporation (a) has not been formed for the
specific purpose of acquiring the Securities, (b) qualifies as an
accredited investor under Rule 501 promulgated under the Act or (c)
each equity owner thereof qualifies as an accredited investor and has
executed and delivered simultaneously herewith a Subscription Agreement
substantially identical to this Agreement and a Confidential
Prospective Purchaser Questionnaire.
(c) If the subscriber is a PARTNERSHIP or a LIMITED LIABILITY
COMPANY:
(i) The undersigned hereby represents, warrants and
covenants that the entity (the "Investor") is duly organized and
existing and itself has all requisite authority to acquire the
Securities.
(ii) The undersigned has been duly authorized by the
Investor to acquire the Securities and to execute all documents,
including this Subscription Agreement, in that regard.
(iii) The undersigned represents and warrants that each of
the above representations or agreements or understandings set forth
herein applies to the Investor.
(iv) The Investor (a) has not been formed for the specific
purpose of acquiring the Securities, and (b) qualifies as an accredited
investor under Rule 501 promulgated under the Act or (c) each equity
owner thereof qualifies as an accredited investor and has executed and
delivered simultaneously herewith a Subscription Agreement
substantially identical to this Agreement and a Confidential
Prospective Purchaser Questionnaire.
10. Representations and Warranties of the Company. In connection
with the sale of the Securities in the Offering, the Company acknowledges that
the undersigned will rely on the information and on the representations set
forth herein, and the Company hereby represents, warrants, agrees and
acknowledges that:
(a) Organization. The Company is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware,
and is duly qualified as a foreign corporation and is in good standing in each
jurisdiction in which such qualification is required by law, other than those
jurisdictions as to which the failure to be so qualified or in good standing
could not, individually or in the aggregate, reasonably be expected to have a
material adverse effect on the condition (financial or other), business,
prospects, properties, net worth or results of operations of the Company (a
"Material Adverse Effect").
(b) Power and Authority; Authorization. The Company has all
requisite corporate power and authority to own, lease and operate its
properties, to conduct its business, to execute and deliver this Subscription
Agreement, and to consummate the transactions contemplated hereby. The
execution, delivery and performance of this Subscription Agreement and the
consummation of the transactions contemplated hereby have been duly authorized
by all necessary corporate action on the part of the Company, and upon execution
and delivery, this Subscription Agreement will constitute a legal, valid and
binding obligation of the Company enforceable against the Company in accordance
with its terms, except as may be limited by applicable bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium or similar laws relating to or
affecting creditors' rights generally and by general principles of equity
(regardless as to whether such enforceability is considered in a proceeding in
equity or at law).
(c) Capitalization. The authorized, issued and outstanding capital
stock of the Company is as set forth in the Company's Reports as of the dates
stated therein. No shares of stock of the Company are entitled to preemptive or
similar rights. The Company is not in violation of any of the provisions of its
certificate of incorporation, by-laws or other charter documents.
(d) No Violation; Consents and Approvals. The execution and
delivery by the Company of this Subscription Agreement does not, and the
consummation of the transactions contemplated hereby will not (i) contravene,
result in any breach of, or constitute a default under, result in the
acceleration of, create any rights accelerate, terminate, modify or cancel or
result in the creation of any lien in respect of any property of the Company
under, any indenture, mortgage, deed of trust, loan, purchase or credit
agreement, lease, license, corporate charter or bylaws, or any other agreement
or instrument to which the Company is bound or by which the Company or any of
its properties may be bound or affected, (ii) violate, conflict with or result
in a breach of any of the terms, conditions or provisions of any order,
judgment, decree, or ruling of any court, arbitrator or governmental authority
applicable to the Company or its properties or assets or (iii) violate any
provision of any statute or other rule or regulation of any governmental
authority applicable to the Company, except, in each case, as would not have a
Material Adverse Effect.
(e) Board Approval for purposes of the Delaware General Corporate
Law (the "DGCL"). The Board of Directors of the Company (the "Board") has
authorized and approved establishment and issuance of the Preferred Shares and
Common Stock made part of the Units and the execution and delivery of this
Subscription Agreement and all other documents to be
executed and delivered in connection with the transactions contemplated hereby
and has approved all of the transactions contemplated hereby. Such approval by
the Board satisfies the requirements of Section 203(a)(l) of the DGCL so that
if, as a result of the consummation of the transactions contemplated hereby, the
undersigned were to become an "interested stockholder" within the meaning of
Section 203(c)(5) of the DGCL, the undersigned, subsequent to consummation of
the transactions contemplated hereby, would not be subject to the prohibition on
business combinations with interested stockholders contained in Section 203 of
the DGCL.
11. Reports of the Company, (the "Company Reports").
The Company is subject to the reporting requirements of
Sections 13 and 15(d) of the Exchange Act. With a view to making
available the benefits of certain rules and regulations of the
Commission that may permit the resale of unregistered securities, the
Company agrees to use its reasonable best efforts to make and keep
public information regarding the Company available as those terms are
understood and defined in Rule 144 under the Act, at all times and to
file with the Commission in a timely manner all reports and other
documents required by the Company under the Act and the Exchange Act.
12. Indemnification.
(a) The undersigned agrees to indemnify and hold harmless
the Company and any of its respective shareholders, officers,
directors, employees and agents from and against all damages, losses,
costs and expenses (including reasonable attorneys' fees) which they
may incur by reason of the failure of the undersigned to fulfill any of
the terms or conditions of this Subscription Agreement, or by reason of
any breach of any of the representations and warranties made by the
undersigned herein or in any document provided by the undersigned to
the Company related to the Subscription documents.
(b) The Company agrees to indemnify, defend and hold the
undersigned and any other persons, trusts or other business entities
controlling, controlled by or under common control with the Investor,
the officers, employees or agents of any such person, trust or business
entity or the heirs and legal representatives of the undersigned
(collectively, "Investor Indemnified Persons") harmless from and
against any and all loss, liability, damage, judgment, claim,
deficiency or reasonable expense (including interest, penalties,
reasonable attorney's fees and amounts paid in settlement) incurred by
or asserted against any Investor Indemnified person arising out of, in
any way connected with, or as a result of (i) any failure of the
Company to fulfill any of the terms or conditions of this Subscription
Agreement, or by reason of any breach of any of the representations and
warranties made by the Company herein or in any document relating to
the transactions contemplated hereby and (ii) any claim, litigation,
investigation or proceeding relating to any of the foregoing, whether
or not any Investor Indemnified Person is a party thereto.
13. Transferability of Subscriptions. This Subscription Agreement
is not transferable or assignable by the undersigned.
14. Adjustments. The amount of Preferred Shares and/or of Common
Stock made part of the Units offered and/or sold in the placement to which this
subscription applies are subject to adjustment in case of and proportionate to
any adjustment in the amount of such similar securities authorized and/or
outstanding by forward and/or reverse split and/or otherwise made at the
direction of the Company where such adjustment applies to all such similar
securities.
15. Redemption.
(a) The Preferred Shares are subject to redemption by the Company as
set forth in the Certificate of Designation. If, however, as to each share of
Series A Class B Preferred Stock outstanding, if such is not redeemed by the
Company within 2 years of the issuance of such shares (which time may be
different as between such shares depending upon when issued) the Company shall
be obligated to issue to the then holder of record of such outstanding Series A
Class B Preferred Stock 0.5 shares of the Company's unissued restricted Common
Stock per share of the Series A Class B Preferred Stock for each year thereafter
where the Company has not redeemed the applicable Series A Class B Preferred
Stock.
(b) Notwithstanding the foregoing section 15(a) of this agreement,
there shall be a cap of no more than 19% of the Common Stock (the "Cap") which
shall be issued under this subscription to assure compliance with applicable
law, including without limitation, applicable NASDAQ rules; provided, however,
if pursuant to the previous sentence, the Company is unable to deliver shares to
Milfam I L.P. because of the Cap than either the Company will (i) use
commercially reasonable efforts to eliminate the application of the Cap by
obtaining (a) the requisite shareholder approval or (b) a written opinion from
NASDAQ setting forth the non-applicability of the Cap or (ii) give Milfam I L.P.
the cash value of the Common Stock (at the current market value) that the
Company is obligated to issue but cannot issue to Milfam I L.P. because of the
Cap.
16. Construction. This Subscription Agreement shall be governed by
and construed in accordance with the laws of the State of New York applicable to
contracts made and to be performed entirely within such state and all parties
hereto submit themselves to the personal jurisdiction of the Courts of such
State to decide upon controversies and questions arising related to this
agreement. This instrument contains the entire agreement of the parties with
respect to the subject matter hereof, and there are no representations,
covenants or other agreements except as stated or referred to herein. Neither
this Subscription Agreement nor any provision hereof shall be modified,
discharged or terminated except by an instrument in writing signed by the party
against whom any waiver, change, discharge or termination is sought.
17. Entire Agreement. This Agreement may be amended only by a
writing executed by the Company and the subscriber executing this Agreement.
18. Further Assurances.
The parties agree to execute such further documents and to take such
further actions as may be necessary and/or reasonably requested to implement the
transactions provided for in this Agreement and confirm the existence of this
Agreement and information provided herein, provided however that no such further
documents or actions shall alter the material terms of this Agreement, and no
publication or public disclosure of the existence or terms of this Agreement
shall be made unless with the prior approval of the Company, unless and until
applicable government regulation shall require such.
19. Counterparts.
This Agreement may be executed in counterpart signature pages which
together shall evidence proper and effective execution of this Agreement by all
parties.
20. Headings.
The headings in this Agreement are for purposes of reference only, and
shall not limit or otherwise affect the meaning hereof
21. Law Governing.
This Agreement shall be construed and enforced in accordance with and
governed by the laws of the State of New York.
It is the intention of the parties that the laws of the State of New
York shall govern the validity of this Agreement, the construction of its terms
and the interpretation of the rights and duties of the parties. Any legal action
or proceeding with respect to this Agreement may be brought in the courts of the
State of New York or of the United States of America for the Southern or Eastern
District of New York, and by execution and delivery of this Agreement, each of
the Company and all Subscribers hereby accepts for itself and in respect of its
property, generally and unconditionally, the jurisdiction of the aforesaid
courts. Each of the Subscriber and the Company hereby knowingly, voluntarily,
intentionally and irrevocably waives, in connection with any such action or
proceeding: (i) any objection, including, without limitation, any objection to
the laying of venue or based on the grounds of forum non conveniens, which it
may now or hereafter have to the bringing of any such action or proceeding in
such respective jurisdictions and (ii) to the maximum extent not prohibited by
law, any right it may have to a trial by jury in respect of any litigation
directly or indirectly arising out of, under or in connection with this
Agreement.
22. Survival. All representations, warranties, covenants,
indemnities and other provisions made by the parties hereto shall be considered
to have been relied upon by the parties,
shall be true and correct as of the agreement date, and shall survive the
execution, delivery, and performance of this agreement.
23. Waiver. No failure on the part of a party to exercise,
and no delay in exercising, any right under this subscription agreement shall
operate as a waiver hereof by such party, nor shall any single or partial
exercise of any right under this Agreement preclude any other or further
exercise thereof or the exercise of any other right. The rights and remedies of
each party provided herein (a) are cumulative and are in addition to, and are
not exclusive of, any rights or remedies provided by law (except as otherwise
expressly set forth in this agreement) and (b) are not conditional or contingent
on any attempt by such party to exercise any of its rights under any other
related document against the other party or any other Entity.
EACH POTENTIAL INVESTOR SHOULD CONSULT HIS OWN PROFESSIONAL ADVISORS AS TO
LEGAL, ACCOUNTING AND OTHER MATTERS RELATING TO ANY INVESTMENT BY HIM IN THE
COMPANY. HOLDERS OF THE SECURITIES ARE REQUIRED TO REPRESENT THAT THE SECURITIES
ARE BEING ACQUIRED FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO SALE OR
DISTRIBUTION, AND HOLDERS THEREOF WILL NOT BE ABLE TO RESELL ANY OF THE
SECURITIES UNLESS THE SECURITIES ARE REGISTERED UNDER THE ACT AND QUALIFIED
UNDER THE APPLICABLE STATE STATUTES OR LAWS OF OTHER APPLICABLE JURISDICTIONS
(UNLESS AN EXEMPTION FROM SUCH REGISTRATION AND QUALIFICATION IS AVAILABLE).
HOLDERS OF THE SECURITIES SHOULD BE PREPARED TO BEAR THE ECONOMIC RISK OF THEIR
INVESTMENT FOR AN INDEFINITE PERIOD OF TIME.
The Company reserves the right to make an individual evaluation of the
suitability of each investor and to have the investor complete a confidential
offeree questionnaire to determine the status of the Subscriber as an
"Accredited Investor" and to evaluate the necessity of and advisability of
seeking further information on the status of the Subscriber as a potential
investor in the Offering. Satisfaction of the Company's suitability standards by
a prospective Offeree does not represent a determination by the Company that the
Company is a suitable investment for such person. Each Offeree must consult
their own professional advisors in order to ascertain the suitability of the
investment. The Company may make or cause to be made such further inquiry and
obtain such additional information as it deems appropriate with regard to the
suitability of prospective Offerees with full cooperation from the Offeree. The
Company may reject subscriptions, in whole or in part, in its sole judgment.
CERTAIN STATES OR OTHER JURISDICTIONS MAY IMPOSE ADDITIONAL SUITABILITY
QUALIFICATIONS FOR INVESTORS WHICH MAY HAVE THE EFFECT OF REQUIRING POTENTIAL
INVESTORS TO HAVE A NET WORTH AND/OR ANNUAL INCOME IN EXCESS OF THE MINIMUM
REQUIREMENTS SET FORTH HEREIN. IF SUCH OFFERS AND SALES ARE MADE IN SUCH STATES,
INVESTORS FROM SUCH STATES OR OTHER JURISDICTIONS, AS THE CASE MAY BE WILL BE
REQUIRED TO MEET SUCH QUALIFICATIONS IN ORDER TO PARTICIPATE IN THIS OFFERING.
[SIGNATURES ON NEXT PAGE]
WITNESS the execution hereof on this 1st of July 2003. [Subscriber please date]
ENTITY SUBSCRIBERS SIGN HERE: INDIVIDUAL SUBSCRIBERS SIGN HERE:
MILFAM I.L.P.
By: Milfam L L C., as managing general partner
____________________________________ _____________________________________
Print Name of Subscriber Print Name of Subscriber
By: /s/ Xxxxx X. Xxxxxx
--------------------------------- _____________________________________
Signature of Authorized Signatory Signature
/s/ Xxxxx X. Xxxxxx, Manager
------------------------------------ _____________________________________
Print Name and Title of Person Signature of Joint Subscriber, if any
Signing
00-0000000
____________________________________ _____________________________________
Taxpayer Identification Number Social Security Number (if joint
subscriber, list and identify Number
for each)
Mailing Address: Xxxxxxxxx Xxxxxxx (Xx Xxxx Xxxxxx Xxx)
0000 XXXXXX DRIVE SAME
____________________________________ _____________________________________
XXXXXX, XXXXXXX 00000-0000
____________________________________ _____________________________________
Telephone Number: 000-000-0000 Telephone Number: ___________________
********
80,000
Number of Units Subscribed For:___________________________
Total Purchase Price: $800,000
Payment Enclosed: $ 800,000
ACCEPTED and AGREED
Synergy Brands Inc.
By /s/ X. Xxxxxxx 7/2/03
--------------------------------- ---------------
As CEO (Date)
