SUBSCRIPTION AGREEMENT FOR COMMON STOCK OF VEMICS, INC.
Exhibit 4.1
(i) if to the Company:
FOR
COMMON STOCK OF
THIS
SUBSCRIPTION AGREEMENT (the "Subscription Agreement") is made and entered into
as of the 24th day of July 2008, between Vemics, Inc., a Nevada corporation (the
'Company") and the undersigned purchaser (the "Investor") (the "Investor,"
together with the "Company," are each referred to as a "Party" and collectively
the "Parties").
WHEREAS,
the Investor desires to subscribe for and purchase from the Company that number
of shares of the Company's common stock, par value $0.001 per share (the "Common
Stock") set forth on Purchaser's signature page hereto (the "Investor Shares")
at a price per share of $0.12, and associated warrants to purchase Common Stock
for a number of shares calculated by multiplying the aggregate number of
Investor Shares by thirty percent (30%) with an exercise price $0.04 per share
(the "Warrants"). A form of the warrant is attached hereto as Appendix A (the
Investor Shares Warrant are referred to collectively as, the "Securities"), on
the terms and subject to the conditions set forth herein. These warrants are
exercisable for (5) Five years from the date of issuance which is concurrent
with the signing of this document.
NOW,
THEREFORE, in consideration of the mutual covenants and agreements contained in
this Subscription Agreement, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, and intending to be
legally bound, the parties hereto agree as follows:
1.
Offering; Subscription: Payment.
(a) The
solicitation of this Subscription Agreement and the offer and sale of the
Securities are being made by the Company in reliance upon the provisions of
Regulation D promulgated by the Securities and Exchange Commission ("SEC") under
the Securities Act of 1933 (the "Securities Act") and the Company is relying on
the representations and warranties of the Investor contained herein to ensure
compliance with exemption from registration of the Securities under Regulation D
of the Securities Act (the "Offering"). Pursuant to the terms of this
Subscription Agreement, the Investor hereby subscribes for and agrees to
purchase the Securities. This offer will expire at noon on July 31, 2008, and
cannot be combined with any previous offer (the "Termination
Date").
(b)
Investor represents and warrants to the Company that Investor has read in its
entirety this Subscription Agreement and each of the following documents in the
offering package that this Subscription Agreement is a part of: (i) the
Registration Statement on Form 10- SB originally filed with the Securities and
Exchange Commission ('"SEC") on August 13,2007, refiled on February 1, 2008,
including the risk factors contained therein, as amended thereafter; and (ii)
the financial statements of the Company as of and for the fiscal year ended June
30,2007 and the interim period ended March 30, 2008 (together, including this
Subscription Agreement and all attachments hereto, the "Company
Materials").
(c)
Subject to the terms d conditions herein set forth, the Investor hereby
irrevocably subscribes for the Investor Shares and the Warrants. The Investor
acknowledges that this subscription shall not be effective unless and until
accepted by the Company.
(d) The
Investor shall be entitled to the following anti-dilution protection relating to
the Investor Shares until the earlier of: (i) the consummation of (i) a merger
or consolidation of the Company with another corporation where the shareholders
of the Company, immediately prior to the merger or consolidation, will not
beneficially own, immediately after the merger or consolidation, shares
entitling such shareholders to more than 51% of all votes to which all
shareholders of the surviving corporation would be entitled in the election of
directors (without consideration of the rights of any class of stock to elect
directors by a separate class vote), (ii) a sale or other disposition of all or
substantially all of the assets of the Company, or (iii) a debt or equity raise
in or more series of transactions of at least $3 million (the "Expiration
Date"):
If, after
the issuance of the Investor Shares to the Investor pursuant to this Offering,
and prior to the Expiration Date, the Company shall consummate an offering for
cash of shares of Common Stock, securities substantially equivalent to the
Investor Shares, or securities convertible into the shares of Common Stock
(excluding, for this purpose, (i) securities issued to employees or directors
of, or consultants or advisors to, the Company or any of its subsidiaries
pursuant to a plan, agreement or arrangement approved by the Board of Directors
of the Corporation, (ii) shares of common stock issued upon conversion of a
convertible security for which an adjustment had already been made hereunder
upon the initial issuance of the convertible security, and (iii) such other
issuances mutually agreed upon by the Company and the Investor), for no
consideration or at a price per share less than $0.12 (a "Dilutive Issuance"),
then the Company shall be obligated to issue and deliver to the Investor, for no
additional consideration, that number of shares equal to the difference between
(i) the number of shares determined by dividing the aggregate dollar amount paid
by Investor for the Investor Shares by the Broad-Based Weighted Average Price
(as defined herein), less (ii) the number of Investor Shares purchased hereunder
prior to the Dilutive Issuance.
The
Broad-Based Weighted Average Price shall be calculated as follows:
P(A) + B
+ (A + C) = Broad Based Weighted Average Price
For
purposes of the foregoing formula, the following definitions shall
apply:
(a) "P"
shall mean, as of the date hereof, the current price per Share (or,
$0.12);
(b) "A"
shall mean the total number of shares of Common Stock outstanding prior to the
Dilutive Issuance, on a fully diluted basis;
(c) "B''
shall mean the aggregate dollar value of the new consideration received by the
Company pursuant to the Dilutive Issuance; and
(d) "C"
shall mean the number of new shares of Common Stock issued pursuant to the
Dilutive Issuance.
For
example, if the total number of shares of Common Stock outstanding prior to the
Dilutive Issuance, on a fully diluted basis, is 80,000,000 and the Company
subsequently E an offering of 10,000,000 shares of Common Stock at a price of
$.07 per share, the Broad-Based Weighted Average Price would be $0.1144 (i.e.,
$1 0,300,000, divided by 90,000,000).
If the
Investor purchased 13,333,333 Investor Shares in this Offering for a total
purchase price of $1,600,000 at $0.12 per Share, the number of Investor Shares
that the Investor would have owned if he invested $1,600,000 at the Broad-Based
Weighted Average Price of $0.1144 would equal 13,986,013 total Investor Shares
and, therefore, the Company would be obliged to issue an additional 652,680
shares to the Investor.
To the
extent that the Company engages in more than one Dilutive Issuance, the
foregoing calculation shall be applied in a manner designed to provide the
Investor with the same anti-dilution protection reflected in the
foregoing.
(e)
Subject to the terms and conditions of this Subscription Agreement and
applicable law, the Investor further agrees to help the Company identify
prospective institutional investors to make investments in Company. If a
prospective institutional investor consummates an investment of $10 million or
more in the Company during the twelve months following the date of this
Agreement, the Company agrees to issue an additional five-year Warrant (in the
form attached hereto) to purchase 2,100,000 shares of Common Stock with an
exercise price of $0.04 per share. Notwithstanding anything else to the contrary
set forth herein, the following entities/persons shall not be considered
prospective institutional investors for which the Investor shall be entitled to
consideration hereunder: (i) any current investor in the Company or any
affiliate of a current investor; (ii) any current affiliate of the Company or
affiliate of a current contact of the Company; (iii) ,any party with which the
Company, the Company's directors or officers, or any investor in the Company has
a pre-existing relationship. In regards to the foregoing, the parties hereto
acknowledge that
(i) The
Investor is not registered as, and in connection with its assistance to the
Company under Section l(e) above, shall not act, either directly or indirectly,
as a broker, dealer, agent or investment advisor under applicable federal or
state securities laws,
(ii) In
performing the services contemplated hereunder relating to referring potential
investors, the Investor's responsibilities shall be limited to introducing
potential investors to the Company, and the Investor shall not use any general
solicitation or general advertising within the meaning of the applicable
securities laws in connection with any offering of securities by
Company.
(iii) The
Investor agrees to introduce the Company to potential investors only in states
in which the Investor has been advised that offers and sales of securities can
be legally made by Company.
(iv) The
Investor shall have no authority to, and shall not, (i) offer for sale or
solicit offers to buy any securities of the Company to or from any person, (ii)
provide any advisory or valuation services to any person regarding any
securities offerings or the merits or risks of an investment in any such
securities, (iii) provide any information to any person, other than such
information to introduce such person to the Company, regarding the Company, its
proposed business or any such securities or offerings, (iv) make any
representations or warranties in connection with any such offerings, or (v)
otherwise effect any transactions with respect to, or induce or attempt to
induce the purchase or sale of, any such securities.
(f) The
Securities subscribed for hereby shall not be deemed owned by the Investor, nor
shall the Investor be deemed a holder of securities of the Company, until this
subscription has been accepted by the Company, the aggregate purchase price for
the Securities subscribed for has been received by the Company, and a closing
has occurred. The Investor understands and agrees that the Company reserves the
right to reject this subscription for the Securities in whole or in part, in its
sole discretion, at any time prior to the issuance of the
Securities.
(g) In
the event of rejection of this subscription in its entirety, or in the event the
sale of the Securities (or any portion thereof) is not consummated for any
reason, this Subscription Agreement shall have no force or effect, except for
Section 9(s) hereof, which shall remain in force and effect.
(h)
Immediately following notice of acceptance of this Subscription by the Company,
the Investor agrees to deliver to the Company by wire transfer or immediately
available funds to an account designated by the Company, the aggregate purchase
price for the Securities in the dollar amount set forth on Investor's signature
page hereto (or the portion thereof for which the Company accepted a
subscription).
(i) The
Company will issue the Securities in the name of the Investor upon the Company's
acceptance of this Subscription Agreement and receipt of full payment of the
aggregate purchase price at the closing of the offering.
(j)
Fractional shares shall not be issued but shall be rounded up or down to the id
nearest whole share.
(k)
Contemporaneous to the Company's acceptance of this Subscription Agreement, the
members of the Company's Board of Directors intend to appoint the Investor's
designee, ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇, to the Board of Directors. As of today, Desnick is
now a Board member.
2. Representations and
Warranties of the Company. The Company hereby represents and warrants the
Investor as follows:
(a) Organization. The
Company is a corporation duly organized, validly existing and in good standing
under the laws of the State of Nevada. The Company has full corporate power and
authority to enter into this Subscription Agreement, to perform its obligations
hereunder and to consummate the transactions contemplated hereby.
(b) Authority. The
execution and delivery of this Subscription Agreement by the Company, and the
performance by the Company of its obligations hereunder, have been duly
authorized by all necessary corporate action by the Company. This Subscription
Agreement has been duly and validly executed and delivered by the Company and
constitutes the legal, valid and binding obligation of the Company, enforceable
against the Company in accordance with its terms. The Securities. The Securities
when issued and delivered to the Investor pursuant Agreement will be duly and
validly issued, fully paid and nonassessable.
3. Representations and Warranties of the
Investor. The Investor hereby represents and warrants to the Company as
follows:
(a)
Authority.
(i) Natural Person. If
the Investor is a natural person, the Investor represents that he or she has the
requisite capacity to execute and deliver this Subscription Agreement, to
perform his or her obligations hereunder and to consummate the transactions
contemplated hereby. This Subscription Agreement has been duly and validly
executed and delivered by the Investor and constitutes the legal, valid and
binding obligation of the Investor, enforceable against the Investor in
accordance with its terms.
(ii)
Entity. If the
Investor is not a natural person, the Investor hereby represents and warrants
that (A) the Investor is duly organized and validly existing, and has the power,
authority and capacity to enter into this Subscription Agreement and to
consummate the transactions contemplated hereby; (B) all necessary actions have
been taken, and all necessary approvals and consents have been given, to
authorize the execution, delivery and performance of this Subscription Agreement
by the Investor; (C) this Subscription Agreement has been duly executed and
delivered by the Investor and constitutes the valid and legally binding
obligation of the Investor, fully enforceable against the Investor in accordance
with its terms; and (D) the execution and delivery of this Subscription
Agreement by the Investor, and the Investor's performance of its obligations
hereunder, will not conflict with the charter, bylaws, trust agreement or other
organizational document(s) of the Investor.
(b) No Violation. The
execution and delivery by the Investor of this Subscription Agreement does not,
and the performance by the Investor of his obligations under this Subscription
Agreement and the consummation of the transactions contemplated hereby will not,
conflict with, result in any violation of or default under, result in any person
or entity having the right to terminate or modify, or require consent under (i)
any note, bond, mortgage, license, lease, contract, commitment, agreement or
arrangement to which the Investor is a Party or by which any of his properties
or assets are bound or (ii) any judgment, decree or order, or statute, law,
ordinance, regulation or rule, applicable to the Investor or to any of the
property or assets of the Investor. No consent, approval, license, permit, order
or authorization of, or registration, declaration or filing with, any court,
administrative agency or commission or other governmental authority or
instrumentality, domestic or foreign, is required to be obtained or made by the
Investor in connection with the execution and delivery of this Subscription
Agreement or the consummation of the transactions contemplated
hereby.
4. Investment Remesentation of
the Investor.
(a) The
Investor has received and carefully read the Company Materials. The Investor has
based the decision to invest on the information contained in such Company
Materials, and has not otherwise relied upon any other offering literature or
prospectus. The Investor acknowledges that the Investor has read, understood and
is familiar with the Risk Factors made part of the Company Materials, is
familiar of risks attending investments of this L/ J type, and has determined
that a purchase of Securities is consistent with Investor's investment
objectives.
(b) The
Investor acknowledges that the Investor has been given the opportunity to ask
questions of, and receive answers from, representatives of the Company regarding
the business and current plans of the Company and the offering of the Securities
and has been given the opportunity to inspect such documents and obtain any
additional information as the Investor has requested so as more fully to
understand the nature of the investment and to verify the accuracy of the
information supplied to the Investor. The Investor acknowledges that, except as
set forth herein, no representations or warranties have been made to Investor,
or to Investor's advisors or representatives, by the Company or others with
respect to the business of the Company and its financial condition.
(c) The
Investor, if an individual, is at least 21 years of age. The Investor maintains
his or her domicile (if an individual) or its principal offices (if not an
individual) at the address shown on the signature page of this Subscription
Agreement.
(d) The
Investor can bear the economic risks of this investment and can afford the loss
of Investor's entire investment in the Securities. The Investor has sufficient
liquid assets to pay the purchase price for the Securities subscribed for
hereby, has adequate means of providing for such Investor's current needs and
possible personal contingencies, and has no present or anticipated need for
liquidity of an investment in the Company. The investment of the Investor in the
Company is reasonable in relation to the Investor's net worth and financial
needs.
(e) The
Investor understands that the price per share of Common Stock has been
arbitrarily determined by the Company and that no assurances have been given
about the increase in value, if any, of the Securities.
(f) The
Investor has the requisite knowledge and experience in business and financial
matters to be capable of evaluating the merits and risks of an investment in the
Company and has determined that such an investment is a suitable
investment.
(g) The
Investor understands that the offer and sale of the Securities have not been
passed upon, nor have the merits of this investment been endorsed or approved
by, any state or federal authorities.
(h) The
Investor is investing in the Securities for Investor's own account as principal
for investment and not with a view toward resale, transfer or distribution. The
Investor understands that Investor must bear the economic risk of an investment
in the Securities for an indefinite period. The Investor has been advised and is
aware that: (i) there is a limited public market for the Securities purchased
hereby; (ii) the securities offered hereby have not been registered under the
Securities Act or the securities laws of any state or other jurisdiction, and,
therefore, cannot be sold -- and Investor agrees not to sell or otherwise
dispose of the securities acquired by Investor -- unless such securities are
subsequently registered under the Securities Act and such state securities laws
as are applicable or unless there are available exemptions from such
registration that are supported by an opinion of counsel for Investor, which
opinion is satisfactory to the Company.
(i) The
Investor acknowledges that the Company has the unconditional right to accept or
reject this Subscription Agreement in whole or in part.
(j) The
Investor understands the meaning and legal consequences of the foregoing
representations and warranties. The Investor certifies that each of the
representations and warranties set forth in this Section 4 is true and correct
as of the date hereof and shall survive such date. The Investor hereby agrees
that the certificate representing the Securities issued to him pursuant hereto
may bear the following legend in addition to any other legends as may be agreed
to by him or as may be required by law:
THE
SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED OR APPLICABLE STATE SECURITIES STATUTES AND
REGULATIONS. SUCH SHARES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE SOLD,
TRANSFERRED, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT FOR SUCH SHARES UNDER 'THE SECURITIES ACT OF 1933, AS AMENDED, UNLESS,
IN THE OPINION (WHICH SHALL BE IN FORM AND SUBSTANCE SATISFACTORY TO THE
COMPANY) OF COUNSEL SATISFACTORY TO THE COMPANY, SUCH REGISTRATION IS NOT
REQUIRED. THE HOLDER ALSO ACKNOWLEDGES THAT THE HOLDERS OF PREFERRED STOCK HAVE
SPECIAL RIGHTS, AS DESCRIBED IN THE COMPANY'S RESTATED ARTICLES OF
INCORPORATION.
(l) The
Investor recognizes that the Company is an early stage company with limited
revenues. The Investor is familiar with the business and financial condition,
properties, operations and prospects of the Company. The Investor acknowledges
that it has read, understood and is familiar with the Risk Factors contained in
the Form 10-SB filed with the SEC, as amended, is familiar with the nature of
risks attending investments of this type, and has determined that a purchase of
Securities is consistent with Investor's investment objectives. The Investor is
aware that an investment in the Securities is a speculative investment involving
a high degree of risk, and that there is no guarantee that it will realize any
gain from an investment in the Securities and that it could lose the total value
of its investment.
(m) The
Investor acknowledges that it has never been promised, guaranteed, or warranted
by the Company, its agents, employees, or any other person, expressly or by
implication, any of the following: (i) the approximate or exact length of time
that it will be required to remain as owner of the Company's securities; (ii)
any expected percentage of profit and/or amount of or type of consideration,
profit or loss to be realized, if any, as a result of the investment; and (iii)
any expected amount of percentage of tax deduction or other tax benefit as a
result of the investment.
(n) The
Investor acknowledges that tile investment in this Company was not effected by
any means of general advertising or general solicitation of an investment in the
Company and that such investment is considered a private
transaction.
5. Accredited Investor and
Suitability Information. The Investor is an "accredited investor" as
defined in Rule 501(a) of Regulation D, under the Securities Act. The Investor
represents and warrants that he, she or it has completed the Investor
Questionnaire contained in Appendix B attached hereto, that the information
contained therein is complete and accurate as of the date hereof and that all of
the undersigned's responses to the information requested therein are
incorporated into this Subscription Agreement as representations and warranties
as if fully set forth herein. The undersigned agrees to furnish any additional
information requested to assure compliance with applicable federal and state
securities laws in connection with the purchase and sale of the
Securities.
6. Conditions to the Investor's
Obligations. The obligation of the Investor to purchase the Securities is
subject to the representations and warranties of the Company contained in
Section 2 hereof being true and correct in all material respects as of the
Closing Date as though made as of the Closing Date.
7. Conditions to the Company's
Obligations. The obligation of the Company to issue and sell the
Securities is subject to the representations and warranties of the Investor
contained in Sections 3 and 4 hereof being true and correct in all material
respects as of the Closing Date as though made as of the Closing
Date.
8. Registration Rights.
If at any time after the first six months from the date of execution of this
subscription agreement, the Company has a class of securities registered under
the Securities Exchange Act of 1934, as amended, the Company proposes to
register any class of stock, it will notify the Investor, and if so requested by
the Investor, will register as part of such registration the Common Stock and
the shares of Common Stock underlying the associated warrant, as requested. The
Investor may request and participate in piggyback registration of its Common
Stock no more than two times. The Investor's piggyback registration rights
hereunder will rank second to any other piggyback registration rights of the
Company existing on the date hereof, or created after the date hereof. The
Company shall immediately notify the Investor of the effective date of any
registration of Investor's shares of Common Stock acquired hereunder. If, in the
written opinion of any managing underwriter, registration of all or any of the
shares requested would unreasonably adversely affect the market for Company's
shares, the Company and the Investor shall negotiate a resolution in good faith.
These rights are not assignable.
9. Miscellaneous.
(a) Further Documents.
The parties agree to execute any and all such further documents and instruments
and to take any and all such further actions reasonably required to effectuate
this Subscription Agreement and the intent and purposes hereof.
(b) Independent Legal
Advice. Neither the Company Materials nor this Subscription Agreement is
to be construed as personal legal, financial or tax advice. The undersigned is
encouraged to obtain independent legal, financial and tax counsel to advise the
undersigned as to the legal and other consequences of investing in the
Securities.
(c) Binding Effect. This
Subscription Agreement shall be binding upon, and any action for a breach
thereof may be brought against, the parties to this Subscription Agreement and
their respective successors and assigns.
(d) Severability. The
invalidity, illegality or unenforceability of one or more of the provisions of
this Subscription Agreement in shall not affect the validity, legality or
enforceability of the remainder of this Subscription Agreement In such
jurisdiction or the validity, legality or enforceability of this Subscription
Agreement, including any such provision, in any other jurisdiction, it being
intended that all rights and obligations of the parties hereunder shall be
enforceable to the fullest extent permitted by law.
(e) Entire Agreement.
This Subscription Agreement supersedes all prior discussions and agreements
between the parties with respect to the subject matter hereof and contains the
sole and entire agreement between the parties hereto with respect to the subject
matter hereof.
(f) Amendment. This
Subscription Agreement may be amended, supplemented or modified only by a
written instrument duly executed by or on behalf of each Party
hereto.
(g) No Third Party
Beneficiaries. The terms and provisions of this Subscription Agreement
are intended solely for the benefit of each Party hereto and their respective
successors and assigns, and it is not the intention of the parties to confer,
and no provision hereof shall confer, third-party beneficiary rights upon any
other person.
(h) No Transfer. The
Investor may not transfer this Subscription Agreement, or any of the Investor's
rights or obligations under this Subscription Agreement, without the written
consent of the Company.
(i) Survival. This
Subscription Agreement shall survive the death, disability, legal incapacity,
bankruptcy, insolvency, dissolution or cessation of business of the
undersigned.
(j) Headings. The
headings used in this Subscription Agreement have been inserted for convenience
of reference only and do not define or limit the provisions hereof.
(k) Governing Law. This
Subscription Agreement shall be governed by and construed in accordance with the
domestic laws of the State of Nevada, without giving effect to any choice of law
or conflict of law provision or rule (whether of the State of Nevada or any
other jurisdiction) that would cause the application of the laws of any
jurisdiction other than the State of Nevada.
(1) Counterparts. This
Subscription Agreement may be executed in any number of counterparts, each of
which will be deemed an original, but all of which together will constitute one
and the same instrument. (m) Recapitalization or Fundamental Change. If any
recapitalization or other transaction affecting the stock of the Company is
effected, then any new, substituted or additional securities or other property
which is distributed with respect to the Securities shall be immediately subject
to this Subscription Agreement, to the same extent that the Securities,
immediately prior thereto, shall have been covered by this Subscription
Agreement.
(n) Specific Performance.
The parties hereto agree that irreparable damage would occur in the event any
provision of this Subscription Agreement were not performed in accordance with
the terms hereof and that the parties, and any third-party beneficiaries hereof,
shall be entitled to specific performance of the terms hereof, in addition to
any other remedy at law or equity.
(o) Waiver. No failure or
delay by any Party in exercising any right, power or privilege under this
Subscription Agreement shall operate as a waiver thereof nor shall any single or
partial exercise thereof preclude any other or further exercise thereof or the
exercise of any other right, power or privilege. The rights and remedies herein
provided shall be cumulative and not exclusive of any rights or remedies
provided by law.
(p) Notices. All notices,
requests, claims, demands and other communications given or made pursuant to
this Subscription Agreement shall be in writing and shall be given or made by
delivery in person, by courier service or by telecopy to the respective parties
at the following addresses and facsimile numbers (or at such other address or
facsimile number for a Party as shall be specified in a notice given in
accordance with this Section):
(i) if to the Company:
▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇
(▇▇▇)
▇▇▇-▇▇▇▇
Attention:
▇▇▇▇ ▇▇▇▇, CEO
With a
copy to:
Shulman,
Rogers, Gandal, Pordy & ▇▇▇▇▇, P.A.
▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
Fax:
(▇▇▇) ▇▇▇-▇▇▇▇
Attention:
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
(ii) if
to the Investor:
To the
address set forth on the Investor's signature page hereto.
All such
notices shall be deemed to have been duly given when delivered by hand, if
personally delivered; when receipt is acknowledged, if telecopied; and on the
next Business Day (as hereinafter defined), if timely delivered to an air
courier guaranteeing overnight delivery. A "Business Day" shall mean any day
that is not a Saturday, a Sunday, or any other day on which banks are required
or authorized by law to be closed in the City of Rockville,
Delaware.
(q) Waiver of Jury Trial.
EACH OF THE PARTIES HERETO
HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING
OR COUNTERCLAIM (WHETHER BASED IN CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR THE ACTIONS OF EITHER PARTY IN THE NEGOTIATION,
ADMINISTRATION, PERFORMANCE AND ENFORCEMENT THEREOF. EACH OF THE PARTIES HERETO
ALSO WAIVES ANY BOND OR SURETY OR SECURITY UPON SUCH BOND WHICH MIGHT, BUT FOR
THIS WAIVER, BE REQUIRED OF SUCH PARTY. EACH OF THE PARTIES HERETO FURTHER
WARRANTS AND REPRESENTS THAT IT HAS REVIEWED THIS WAIVER WITH ITS AND THAT IT
KNOWINGLY -- AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION
WITH LEGAL COUNSEL. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE
MODIFIED EITHER ORALLY OR IN WRITING, AND THIS WAIVER SHALL APPLY TO ANY
SUBSEQUENT AMENDMENT, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT.
IN THE EVENT OF LITIGATION, THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO
A TRIAL BY THE COURT.
(r) Confidentiality. The
Investor agrees to maintain the secrecy and confidentiality of any Trade Secrets
and any Confidential Information which is provided to the Investor for purposes
of evaluating its purchase of the Securities. As used herein, "Trade Secrets"
shall include, without limitation, all formulae, patterns, compilations,
programs, devices, methods, techniques, processes and all other information used
in the conduct of the Company's business that would be deemed "trade secrets"
within the meaning of the Uniform Trade Secrets Act. The Investor acknowledges
that the Trade Secrets are of independent economic value to the Company because
they are not generally known and are the subject of efforts by the Company to
maintain their secrecy. As used herein, "Confidential Information" shall mean
any and all technical or business information of the Company furnished or
disclosed, in whatever form or medium, by the Company to the Investor or
discovered by the Investor, including but not limited to computer programs,
source code, object code, reports, documentation, product/service
specifications, marketing plans, financial data and personnel statistics. The
Investor acknowledges that all Trade Secrets, all Confidential Information and
all books, documents, lists and records pertaining to the Company's business
(collectively, the "Records"), whether the Records are written, typed, printed,
contained on microfilm, contained on computer disc, contained on tape or set
forth in some other medium of expression, are the sole and exclusive property of
the Company. The Investor agrees not to (i) divulge, furnish or make accessible
to anyone or in any way use, for the Investor's benefit or for the benefit of
any other person, firm or entity, any Trade Secret or any Confidential
Information; (ii) take or permit any action to be taken which would reduce the
value of the Trade Secrets or the Confidential Information to the Company; or
(iii) otherwise misappropriate or suffer the misappropriation of the Trade
Secrets or the Confidential Information. Notwithstanding anything herein to the
contrary, the obligations of secrecy and confidentiality set forth herein shall
not apply to any information which is now generally publicly known or which
subsequently becomes generally publicly known other than as a direct or indirect
result of the breach of this Subscription Agreement by Investor.
(s) Indemnification. The
Investor hereby agrees to indemnify the Company and its directors, officers,
agents, attorneys and shareholders and hold them harmless from and against any
and all loss, damage, liability or expense (including costs and reasonable
attorney's fees) to which they may be subject or which they may incur by reason
of or in connection with any misrepresentation made by the undersigned, any
breach of any of the undersigned's representations or warranties, or the
undersigned's failure to fulfill any of the undersigned's covenants or
agreements, under this Subscription Agreement, or any other document furnished
by the undersigned. This Subscription Agreement and the representations and
warranties and indemnification contained herein shall be binding upon the
undersigned, the undersigned's heirs, executors, administrators, successors and
assigns, and shall survive the acceptance of this Subscription and the sale of
the securities.
(t) Brokers. Investor has
not entered into any agreement to pay any broker's for finder's fee to any
person with respect to this Subscription Agreement or the transactions
contemplated hereby.
[SIGNATURES
ON FOLLOWING PAGE]
COUNTERPART
SIGNATURE PAGE TO
SUBSCRIPTION
AGREEMENT
IN
WITNESS WHEREOF, the undersigned Investor, desiring to purchase the Securities,
by executing this signature page, intending to be legally bound, hereby
executes, adopts and agrees to all terms, conditions and representations of the
Subscription Agreement to which this Counterpart Signature page is
attached.
Total
number of shares of Common Stock to be purchased:
13,333,333 shares
Aggregate
Purchase
Price $1,600,000.00 ($0.12
x number of shares)
The
Investor must also complete the Investor Questionnaire attached as Appendix
A.
If
Securities are to be purchased by an individual, the Investor should sign
below:
Date:
_______________ ____________________
Signature of Investor
____________________ ____________________
Social
Security
No. Print
Name
If
Securities are to be purchased by an entity, the authorized individual of the
Investor should sign below:
Date:
July 29,
2008
/s/Ravine Valley Partners,
LLC
Print Name of Entity
LLC Tax ID
Pending /s/▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇,
M.D.
Tax
Identification
No. Signature
of Authorized Signatory
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇,
M.D.
Title: Member,
Manager
If
the Securities are to be purchased jointly, each Investor should sign
below:
Date:
_______________ ____________________
Signature
of Shareholder
____________________ ____________________
Social
Security
No. Print
Name
Date:
_______________ ____________________
Signature of Shareholder
____________________ ____________________
Social
Security
No. Print
Name
All
Investors should provide the information below:
Principal
Residence
Address: Mailing
Address, if different from
Residence
Address:
________________________________________
________________________________________
________________________________________
________________________________________
The
Subscription is accepted on the 29th day of
July 2008.
Accepted
by:
/s/ ▇▇▇▇▇
▇▇▇▇▇
Name:
▇▇▇▇▇ ▇▇▇▇▇
Title:
COO
Appendix
A
Form
of Warrant
Appendix
B
INVESTOR
QUESTIONNAIRE
(ALL
INFORMATION WILL BE TREATED CONFIDENTIALLY)
To:
Vemics, Inc.
This
Investor Questionnaire ("Questionnaire") must be completed by the Investor to
subscribe for and purchase from the Company that number of shares of the
Company's common stock, value $0.001 per share (the "Common Stock'') set forth
on Purchaser's signature page to Subscription Agreement (the "Investor Shares")
at a price per share of $0.12, and associated warrants to purchase Common Stock
for a number of shares calculated by multiplying the aggregate number of
Investor Shares by thirty percent (30%) with an exercise price $0.04
per share (the “Warrants”) on the terms and subject to the conditions
set forth in the Subscription Agreement. These warrants are exercisable for a
period of (5) Five years from date of issuance which is concurrent with the
signing of this contract.
The
securities are being offered and sold by Vemics, Inc. (the "Company") without
registration under the Securities Act of 1933, as amended (the "Act"), and the
securities laws of certain states, in reliance on the exemptions contained in
Section 4(2) of the Act and Regulation D promulgated thereunder and in reliance
on similar exemptions under applicable state laws. The Company must determine
that a potential investor meets certain suitability requirements before offering
or selling Securities to such investor.
The
purpose of this Questionnaire is to assure the Company that each investor will
meet the applicable suitability requirements. The information supplied by you
will be used in determining whether you meet such criteria, and reliance upon
the private offering exemptions from registration is based in part on the
information herein supplied.
This
Questionnaire does not constitute an offer to sell or a solicitation of an offer
to buy any security. Your answers will be kept strictly confidential except to
the extent requested by the Securities and Exchange Commission or state
securities regulators.
By
signing this Questionnaire, you will be authorizing the Company to provide a
completed copy of this Questionnaire to such parties as the Company deems
appropriate in order to ensure that the offer and sale of the Securities will
not result in a violation of the Act or the securities laws of any state and
that you otherwise satisfy the suitability standards applicable to purchasers of
the Securities.
All
potential investors must answer all applicable questions and complete, date and
sign this Questionnaire.
Please
print or type your responses and attach additional sheets of paper if necessary
to complete your answers to any item.
A. BACKGROUND
INFORMATION
Name:
Ravine Valley
Partners, LLC
Address: ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇
(Number and Street)
▇▇▇▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇
(City) (State) (Zip
Code)
Telephone
Number: (▇▇▇)
▇▇▇-▇▇▇▇
If I am
an individual:
Age:_______ Citizenship:____________
If a
corporation, partnership, limited liability company, trust or other
entity:
Type of
entity: Limited
Liability Company
State of
formation:_____________ Date of formation: July, 28,
2008
Social
Security/Taxpayer Identification No. LLC Tax ID#
Pending
B. STATUS AS ACCREDITED
INVESTOR The undersigned is an "accredited investor'ks such term is
defined in Regulation D under the Act, as at the time of the sale of the
Securities the undersigned falls within one or more of the following categories
(Please initial one or more, as applicable):'
___(1) a
bank as defined in Section 3(a)(2) of the Act, or a savings and loan association
or other institution as defined in Section 3(a)(5)(A) of the Act whether acting
in its individual or fiduciary capacity; a broker or dealer registered pursuant
to Section 15 of the Securities Exchange Act of 1934; an insurance company as
defined in Section 2(13) of the Act; an investment company registered under the
Investment Company Act of 1940 or a business development company as defined in
Section 2(a)(48) of that Act; a Small Business Investment Company licensed by
the U.S. Small Business Administration under Section 301(c) or (d) of the Small
Business Investment Act of 1958; a plan established and maintained by a state,
its political subdivisions, or any agency or instrumentality of a state or its
political subdivisions for the benefit of its employees, if such plan has total
assets in excess of $5,000,000; an employee benefit plan within the meaning of
the Employee Retirement Income Security Act of 1974. if the investment decision
is made by a plan fiduciary, as defined in Section 3(21) of such Act, which is
either a bank, savings and loan association, insurance company, or registered
investment adviser, or if the employee benefit plan has total assets in excess
of $5,000,000 or, if
_____________
1 As used
in this Questionnaire, the term "net worth" means the excess of total assets
over total liabilities. In computing net worth for the purpose of subsection
(4), the principal residence of the investor must be valued at cost, including
cost of improvements, or at recently appraised value by an institutional lender
making a secured loan, net of encumbrances. In determining income, the investor
should add to the investor's adjusted gross income any amounts attributable to
tax exempt income received, losses claimed as a limited partner in any limited
partnership, contributions to an ▇▇▇ or ▇▇▇▇▇ retirement plan, alimony payments,
and any amount by which home from long-term capital gains has been reduced in
arriving at adjusted gross income.
a
self-directed plan, with the investment decisions made solely by persons that
are accredited investors;
___(2) a
private business development company as defined in Section 202(a)(22) of the
Investment Advisers Act of 1940;
___(3) an
organization described in Section 5Ol(c)(3) of the Internal Revenue Code of
1986, as amended, corporation, Massachusetts or similar business trust, or
partnership, not formed for the specific purpose of acquiring the Securities
offered, with total assets in excess of $5,000,000;
___(4) a
natural person whose individual net worth, or joint net worth with that person's
spouse, at the time of such person's purchase of the Securities exceeds
$1,000,000;
___(5) a
natural person who had an individual income in excess of $200,000 in each of the
two most recent years or joint income with that person's spouse in excess of
$300,000 in each of those years and has a reasonable expectation of reaching the
same income level in the current year;
___(6) a
trust, with total assets in excess of $5,000,000, not formed for the specific
purpose of acquiring the Securities offered, whose purchase is directed by a
sophisticated person as described in Rule 506(b)(2)(ii) of Regulation D; and
1f-T
ü
(7) an entity in which all of the equity owners are accredited investors (as
defined above).
IN
WITNESS WHEREOF, the undersigned has executed this Questionnaire this 29th day
of July 2008, and declares under oath that it is truthful and
correct
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇,
MD
Print
Name
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇,
MD
Signature
Title:
Member
Manager
(required
for any purchaser that is a corporation, partnership, trust or other
entity)