SUBSCRIPTION AGREEMENT
The Alpine Group, Inc.
Xxx Xxxxxxxxxxx Xxxxx
Xxxx Xxxxxxxxxx, Xxx Xxxxxx 00000
Gentlemen:
1. Subscription. (a) Subject to the terms and conditions of this
Subscription Agreement, the undersigned, a director or officer of The Alpine
Group, Inc., a Delaware corporation (the "Company"), or a subsidiary thereof,
hereby agrees to purchase, for $380.00 per share, that number of shares of the
Company's series A preferred stock, par value $1.00 per share (the "Preferred
Stock"), set forth opposite the undersigned's name on Exhibit A hereto. The
offer and sale of Preferred Stock pursuant to this Subscription Agreement is
part of an offering of Preferred Stock being made by the Company to all of the
directors of the Company and certain of the officers of the Company or a
subsidiary thereof. The terms and provisions of the Preferred Stock are
currently expected to be substantially as described on Exhibit B hereto.
(b) The Company has also advised the undersigned that it currently
intends to engage in an exchange offer (the "Exchange Offer"), whereby the
holders of the Company's common stock, par value $.10 per share (the "Common
Stock"), may exchange their shares of Common Stock for a new issue of the
Company's 6% subordinated notes. The terms and provisions of the 6% subordinated
notes and of the Exchange Offer are currently expected to be substantially as
described on Exhibit C hereto.
(c) The undersigned has also been advised that the Company intends
to offer (the "Rights Offering") to its stockholders (other than such directors
and officers, as provided by Section 1(d) hereof) the right to subscribe for
shares of Preferred Stock in proportion to their current ownership of Common
Stock. It is anticipated that each such stockholder will have the right to
subscribe for one share of Preferred Stock for each 500 shares of Common Stock
owned by such stockholder. The Rights Offering will be made pursuant to a
registration statement filed with the Securities and Exchange Commission (the
"SEC") under the Securities Act of 1933 (the "Securities Act"). The terms and
provisions of the Rights Offering are currently expected to be substantially as
described on Exhibit B hereto.
(d) In view of the opportunity of the undersigned to subscribe for
shares of Preferred Stock hereunder, the undersigned hereby agrees with the
Company that: (i) the undersigned will not participate in the Exchange Offer and
(ii) the undersigned will not exercise or transfer his or her rights with
respect to the Rights Offering.
(e) The undersigned understands that there can be no assurance that
the Company will consummate the Rights Offering or the Exchange Offer on the
terms set forth on Exhibits B and C, respectively, or at all.
2. Payment. The undersigned has forwarded or is herewith forwarding by
wire transfer the full amount of the purchase price of the shares of Preferred
Stock being subscribed for to the following account:
Citibank, N.A.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
ABA# 000000000
Account #00000000
Proskauer Rose LLP
Attorney Trust Account
3. Deposit of Funds. The payment made as provided in Section 2 hereof
shall be returned by the Company to the undersigned in the event of the earlier
to occur of (a) the cancellation of this offering or (b) June 30, 2003 (unless
extended by the Company) if, on or prior to such date, the Company shall not
have consummated the sale of at least an aggregate of 5,265 shares of Preferred
Stock to the directors and officers of the Company or officers of a subsidiary
thereof.
4. Acceptance of Subscription. The undersigned understands and agrees that
the Company in its sole discretion reserves the right to accept or reject this
subscription or any other subscription from any other director or officer for
the Preferred Stock in whole or in part. If this subscription is rejected in
whole or in part, the Company shall promptly return the funds received from the
undersigned (or the appropriate portion thereof in the event of a rejection in
part by the Company) without interest thereon or deduction therefrom. In the
event of a rejection in whole by the Company, this Subscription Agreement shall
thereafter be of no further force or effect.
5. Representations, Warranties and Covenants of the Undersigned. The
undersigned hereby acknowledges, represents and warrants to, and covenants and
agrees with, the Company as follows:
(a) the undersigned understands that the offering and sale of the
Preferred Stock is intended to be exempt from registration under the Securities
Act by virtue of Section 4(2) of the Securities Act and the provisions of
Regulation D promulgated thereunder and in accordance therewith and in
furtherance thereof, the undersigned represents and warrants to and agrees with
the Company as follows:
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(i) The undersigned has carefully reviewed the Company's
Annual Report on Form 10-K for the year December 31, 2002, as amended, its
Quarterly Report on Form 10-Q for the quarter ended March 31, 2003, and any
other documents publicly filed by the Company with the SEC since December 31,
2002;
(ii) The undersigned acknowledges that all documents, records
and books pertaining to this investment have been made available for inspection
by the undersigned, his or her attorney, accountant or purchaser representative;
(iii) The undersigned and his or her advisor(s) have had a
reasonable opportunity to ask questions of and receive answers from a person or
persons acting on behalf of the Company concerning the offering of the Preferred
Stock and related matters and all such questions have been answered to the full
satisfaction of the undersigned;
(iv) No oral or written representations have been made by the
Company other than as stated herein, and no oral or written information
furnished to the undersigned or his or her advisor(s) in connection with the
offering of the Preferred Stock and related matters were in any way inconsistent
with the information stated herein;
(v) The undersigned is not subscribing for the Preferred Stock
as a result of or subsequent to any advertisement, article, notice or other
communication published in any newspaper, magazine or similar media or broadcast
over television or radio, or presented at any seminar or meeting, or any
solicitation of a subscription by a person not previously known to the
undersigned in connection with investments in securities generally;
(vi) The undersigned has reached the age of majority in the
state in which the undersigned resides, has adequate means of providing for the
undersigned's current financial needs and contingencies, is able to bear the
substantial economic risks of an investment in the Preferred Stock for an
indefinite period of time, has no need for liquidity in such investment and, at
the present time, could afford a complete loss of such investment;
(vii) The undersigned has such knowledge and experience in
financial, tax and business matters so as to enable him or her to utilize the
information made available to him or her in connection with the offering of the
Preferred Stock to evaluate the merits and risks of an investment in the
Preferred Stock and to make an informed investment decision with respect
thereto;
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(viii) The undersigned is not relying on the Company with
respect to the tax and other economic considerations of an investment, and the
undersigned has relied on the advice of, or has consulted with, only his or her
own advisors;
(ix) The undersigned either (A) had income of more than
$200,000 in each of the most recent two years or joint income with the
undersigned's spouse in excess of $300,000 in each of the most recent two years
and reasonably expects to reach that same income level for the current year or
(B) has an individual net worth, or joint net worth with the undersigned's
spouse, in excess of $1,000,000.
(x) The undersigned will not sell or otherwise transfer the
Preferred Stock or the shares of Common Stock issuable upon conversion of the
Preferred Stock without registration under the Securities Act or an exemption
therefrom, and fully understands and agrees that he or she must bear the
economic risk of his or her purchase for an indefinite period of time because,
among other reasons, the Preferred Stock and the shares of Common Stock issuable
upon conversion of the Preferred Stock have not been registered under the
Securities Act or under the securities laws of certain states and, therefore,
cannot be resold, pledged, assigned or otherwise disposed of unless the
securities are subsequently registered under the Securities Act and under the
applicable securities laws of such states or unless an exemption from such
registration is available in the opinion of counsel for the holder, which
counsel and opinion are reasonably satisfactory to counsel for the Company. The
undersigned represents that he or she currently is, and if he or she converts
the Preferred Stock, he or she will be deemed to be representing that at that
time, he or she is, willing and able to bear the economic risk of his or her
investment in the Preferred Stock (including the shares of Common Stock issuable
upon conversion of the Preferred Stock), has no need for liquidity with respect
thereto, is able to sustain a complete loss of his or her investment, and is
purchasing the Preferred Stock (including the shares of Common Stock issuable
upon conversion of the Preferred Stock), for his or her own account, for
investment and not with a view to resale or distribution except in compliance
with the Securities Act. The undersigned is aware that an exemption from the
registration requirements of the Securities Act pursuant to Rule 144 promulgated
thereunder is not presently available; that the Company has no obligation to
make available an exemption from the registration requirements pursuant to such
Rule 144 or any successor rule for resale of the Preferred Stock or the shares
of Common Stock issuable upon conversion of the Preferred Stock; and that even
if an exemption under Rule 144 were available, Rule 144 permits only routine
sales of securities in limited amounts in accordance with the terms and
conditions of such Rule 144. The undersigned further acknowledges that there is
presently no market for the purchase and sale of the Preferred Stock and that no
such market may ever exist; and
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(xi) The undersigned agrees that the following legend or a
substantially similar legend may be placed on the certificate or certificates
representing the Preferred Stock and the shares of Common Stock issuable upon
conversion of the Preferred Stock and a stop transfer order may be placed with
respect thereto:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933 AND CAN NOT BE OFFERED OR SOLD EXCEPT PURSUANT
TO AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT OR AN EXEMPTION FROM
REGISTRATION UNDER SUCH ACT WHICH, IN THE OPINION OF COUNSEL FOR THE HOLDER,
WHICH COUNSEL AND OPINION ARE REASONABLY SATISFACTORY TO COUNSEL FOR THIS
CORPORATION, IS AVAILABLE.
(b) The undersigned's overall commitment to investments which are
not readily marketable is reasonable in relation to his or her net worth.
(c) The undersigned acknowledges:
(i) That he or she is aware that investment in the Preferred
Stock involves a number of very significant risks; and
(ii) The representations, warranties and agreements of the
undersigned contained herein shall survive the execution and delivery of this
Subscription Agreement and the purchase of the Preferred Stock subscribed for
hereby.
(d) If requested by the Company in connection with the Rights
Offering, the undersigned agrees to vote, or execute a written consent with
respect to, all securities of the Company as to which the undersigned has voting
power (including the shares of Preferred Stock subscribed for herewith) in favor
of amending the Company's Certificate of Incorporation in order to increase the
number of shares of Common Stock which the Company is authorized to issue.
6. Representations and Warranties of the Company. The Company hereby
represents and warrants to the undersigned as follows:
(a) The Company is a corporation duly organized, validly existing
and in good standing under the laws of its jurisdiction of incorporation; and
(b) Subject to the authorization by the Board of Directors of a
certificate of designation relating to the Preferred Stock and the execution and
filing thereof with the State of Delaware, (i) the Company has all requisite
power and authority to execute, deliver and perform this Subscription Agreement,
to issue and sell the Preferred Stock to the undersigned and to issue the shares
of Common Stock issuable upon conversion of such Preferred Stock; (ii) all
necessary corporate proceedings of the Company have been duly taken to authorize
the execution, delivery and performance of this Subscription Agreement by the
Company and to authorize the creation and issuance of the Preferred Stock and
its sale to the undersigned; (iii) following receipt by the Company of the
purchase price from the undersigned for the Preferred Stock purchased by the
undersigned and delivery of the stock certificates representing such Preferred
Stock to the undersigned, such Preferred Stock will be validly issued, fully
paid and nonassessable; and (iv) upon conversion of the Preferred Stock into
Common Stock in accordance with the terms of the Preferred Stock, the Common
Stock thereupon issued will be duly authorized, validly issued, fully paid and
nonassessable.
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7. Irrevocability; Binding Effect. The undersigned hereby acknowledges and
agrees that this Subscription Agreement is irrevocable by the undersigned, that,
except as required by law, the undersigned is not entitled to cancel, terminate
or revoke this Subscription Agreement or any agreements of the undersigned
hereunder, and that this Subscription Agreement and such other agreements shall
survive the death or disability of the undersigned and shall be binding upon and
inure to the benefit of the parties hereto and their respective heirs,
executors, administrators, successors, legal representatives and permitted
assigns.
8. Modification. Neither this Subscription Agreement nor any provisions
hereof may be waived, modified, discharged or terminated except by an instrument
in writing signed by the party against whom any such waiver, modification,
discharge or termination is sought.
9. Notices. Any notice or other communication required or permitted to be
given hereunder shall be in writing and shall be mailed by certified mail,
return receipt requested, or delivered against receipt to the party to whom it
is to be given (a) if to the Company, at the address set forth above or (b) if
to the undersigned, at the address set forth on the signature page hereof (or,
in either case, to such other address as the party shall have furnished in
writing in accordance with the provisions of this Section 9). Any notice or
other communication given by certified mail shall be deemed given at the time of
certification thereof, except for a notice changing a party's address which
shall be deemed given at the time of receipt thereof.
10. Assignability. This Subscription Agreement and the rights and
obligations hereunder are not transferable or assignable by the undersigned.
11. Applicable Law. This Subscription Agreement shall be governed by and
construed in accordance with the laws of the State of New York as applied to
residents of that state executing contracts wholly to be performed in that
state.
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IN WITNESS WHEREOF, the undersigned has executed this Agreement this ____
day of June, 2003.
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Print Name
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Signature of Subscriber
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Social Security Number
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Address
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ACCEPTED AND
AGREED:
THE ALPINE GROUP, INC.
By ________________________________
Name:
Title:
Date: June __, 2003
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EXHIBIT A
Aggregate
Purchaser Number of Shares Purchase Price
--------- ---------------- --------------
Xxxxxxx Xxxxx 500 $ 190,000
Xxxxxx X. Xxxxxx 3,948 (1) 1,500,240
Xxxxxxxx Xxxxxxxx 265 100,700
Xxxx Xxxxxxx 620 235,600
Xxxxxx X. Xxxx 53 20,140
Xxxxx Xxxxxx 400 152,000
Xxxxx X. Xxxx 80 30,400
X. Xxxxxxxx Posner 1,316 500,080
Xxxxx Xxxxx 800 (1) 304,000
Xxxx X. Xxxxx 40 15,200
Xxxxxxx Xxxxxxxxx 265 100,700
-------- -----------
8,287 $ 3,149,060
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(1) Some or all of these shares may be purchased by, or transferred to, an
entity wholly owned by Messrs. Xxxxxx and Xxxxx.
