SOFTWARE PUBLISHING CORPORATION HOLDINGS, INC.
COMMON STOCK
SUBSCRIPTION AGREEMENT
October 23, 1997
Software Publishing Corporation Holdings, Inc.
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Dear Sirs/Madams:
Based upon the representations and warranties of Software Publishing
Corporation Holdings, Inc., a Delaware corporation (the "Company"), to the
extent and as set forth in Section 1 below, and subject to the other terms and
conditions hereinafter provided, the undersigned hereby irrevocably subscribes
(the "Subscription") to purchase _______ shares of common stock, par value $.001
per share (the "Common Stock") of the Company, at a price equal to $1.063 per
share of Common Stock, or $__________ in the aggregate (the "Subscription
Price"), and hereby tenders to the Company in full the Subscription Price in
immediately available funds. The date on which the Company accepts this
subscription is hereinafter referred to as the "Closing Date."
The Subscription of the undersigned being made hereby is subject to and is
made pursuant to the following terms and conditions:
1. Representations, Warranties and Covenants of the Company. By its
acceptance of this Subscription Agreement, the Company shall be deemed to
represent and warrant to and covenant with the undersigned as follows:
(a) Corporate Status. The Company (A) is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware,
(B) has all necessary corporate power and authority to own, operate or lease the
properties and assets now owned, operated or leased by the Company and to carry
on the business of the Company, as it is now being conducted, and (C) is duly
licensed or qualified and in good standing as a foreign corporation authorized
to do business in each jurisdiction wherein the character of the properties
owned or leased by the Company and/or the nature of the activities conducted by
the Company makes such licensing or qualification necessary, except where the
failure to be so licensed or qualified and in good standing would not prevent
the Company from performing any of its material obligations under this
Subscription Agreement and would not have a material adverse effect on the
business, operations or financial condition of the Company (a "Material Adverse
Effect");
(b) Authority of Agreement. The Company has the power and authority to
accept, execute and deliver this Subscription Agreement and, upon acceptance by
the Company (in whole or part), to carry out its obligations hereunder; and the
execution, delivery and performance by the Company 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
this Subscription Agreement, upon acceptance by the Company (in whole or part),
constitutes the valid and legally binding obligations of the Company enforceable
against the Company in accordance with its terms, except as the same may be
limited by bankruptcy, insolvency, reorganization or other laws affecting the
enforcement of creditors' rights generally now or hereafter in effect and
subject to the application of equitable principles and the availability of
equitable remedies. The shares of Common Stock to be issued hereunder, upon
issuance thereof in accordance with the terms hereof, will be validly
authorized, fully paid and non-assessable;
(c) Consents and Approvals; No Conflict.
(i) The acceptance, execution and delivery of this Subscription
Agreement by the Company does not, and the performance by the Company of
its obligations hereunder, upon acceptance by the Company (in whole or
part), will not, require any consent, approval, authorization or other
action by, or filing with or notification to, any governmental or
regulatory authority, other than in connection with state securities or
"blue sky" laws, except where failure to obtain such consent, approval,
authorization or action, or to make such filing or notification, would not
prevent the Company from performing any of its material obligations under
this Subscription and would not have a Material Adverse Effect; and
(ii) The acceptance, execution, delivery and performance of this
Subscription Agreement by the Company and the other agreements and
documents to be executed, delivered and performed by the Company pursuant
hereto and the consummation of the transactions contemplated hereby and
thereby by the Company do not and will not conflict with, violate or result
in a breach or termination of any provision of, or constitute a default
under (or event which with the giving of notice or lapse of time, or both,
would become a default under) the Certificate of Incorporation or By-laws
of the Company or, except as would not prevent the Company from performing
any of its material obligations under this Subscription Agreement and would
not have a Material Adverse Effect, any law, rule, regulation, order, writ,
judgment, injunction, decree, determination or award applicable to the
Company or give to others any rights of termination, amendment,
acceleration or cancellation of, or result in the creation of any lien or
encumbrance on any of the assets or properties of the Company pursuant to,
any note, bond, mortgage, indenture, contract, agreement, lease, license,
permit, franchise or other instrument relating to such assets or properties
to which the Company is a party or by which any of such assets or
properties is bound;
(d) Absence of Litigation. No claim, action, proceeding or investigation is
pending, or to the best knowledge of the Company, threatened, which seeks to
delay or prevent the consummation of the transactions contemplated hereby or
which would be reasonably likely to adversely affect the Company's ability to
consummate the transactions contemplated hereby or which would have a Material
Adverse Effect;
(e) Extent of Offering. Subject in part to the truth and accuracy of the
undersigned's representations set forth in Section 2 of this Subscription
Agreement and the compliance by all agents of the Company with Rule 503(c) of
Regulation D ("Regulation D") promulgated under the Securities Act of 1933, as
amended (the "Securities Act"), the offer, sale and issuance of the shares of
Common Stock as contemplated by this Subscription Agreement (the "Shares") are
exempt from the registration requirements of the Securities Act and are exempt
or the Company has complied with registration requirements of each state where
the Shares are offered or sold, and the Company will not take any action
hereafter that would cause the loss of such exemption or registration;
(f) Accuracy of Reports and Information. The Company is in full compliance,
to the extent applicable, with all reporting obligations under Section 12(b), 12
(g) or 15(d), as applicable, of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"). The Company has registered its Common Stock pursuant to
Section 12 of the Exchange Act and the Common Stock is listed and trades on the
Nasdaq SmallCap Market. The Company has filed all material required to be filed
pursuant to all reporting obligations, under either Section 13(a) or 15(d) of
the Exchange Act for a period of at least twelve (12) months immediately
preceding the offer or sale of the Shares.
(g) SEC Filings/Full Disclosure. None of the Company's filings with the
Securities and Exchange Commission since January 1, 1997 contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein in light of the
circumstances under which they were made, not misleading. The Company has, since
January 1, 1997, timely filed all requisite forms, reports and exhibits thereto
with the Securities and Exchange Commission ("SEC"). The Company's Annual Report
on Form 10-KSB for the year ended December 31, 1996 (the "1996 10-K"), its
Quarterly Reports for the periods ended March 31 and June 30, 1997 and all
Current Reports on form 8-K filed by the Company from January 1, 1997 to date
are referred to as the "SEC Reports."
There is no fact known to the Company (other than general economic
conditions known to the public generally) that has not been disclosed in writing
to the Purchaser which could reasonably be expected to materially and adversely
affect the ability of the Company to perform its obligations pursuant to this
Agreement.
(h) Absence of Undisclosed Liabilities. The Company has no material
liabilities or obligations, absolute or contingent (individually or in the
aggregate), except as set forth in the financial statements included in the SEC
Reports (collectively, the "Financial Statements") or as incurred in the
ordinary course of business after the date of the Financial Statements.
(i) Governmental Consent, etc. No consent, approval or authorization of or
designation, declaration or filing with any governmental authority on the part
of the Company is required in connection with the valid execution and delivery
of this Agreement, or the offer, sale or issuance of the Shares, or the
consummation of any other transaction contemplated hereby, except the filing
with the SEC of a registration statement on Form S-3 for the purpose of
registering the Common Stock underlying the Shares and any state securities laws
filings or registrations.
(j) Intellectual Property Rights. Except as disclosed in the SEC Reports,
the Company has sufficient trademarks, trade names, patent rights, copyrights
and licenses to conduct its business as contemplated therein. To the Company's
knowledge, neither the Company nor its products is infringing or will infringe
any trademark, trade name, patent right, copyright, license, trade secret or
other similar right of others currently in existence; and there is no claim
being made against the Company regarding any trademark, trade name, patent,
copyright, license, trade secret or other intellectual property right which
could have a material adverse effect on the condition (financial or otherwise),
business, results of operations or prospects of the Company.
(k) Material Contracts. Except as set forth in the SEC Reports or disclosed
to the Purchaser, the agreements to which the Company is a party described
therein are valid agreements, in full force and effect, the Company is not in
material breach or material default (with or without notice or lapse of time, or
both) under any of such agreements, and, to the Company's knowledge, the other
contracting party or parties thereto are not in material breach or material
default (with or without notice or lapse of time, or both) under any of such
agreements.
(l) Title to Assets. Except as set forth in SEC Reports, the Company has
good and marketable title to all properties and material assets described
therein as owned by it, free and clear of any pledge, lien, security interest,
encumbrance, claim or equitable interest other than such as are not material to
the business of the Company.
(m) Subsidiaries. The Company does not presently own or control, directly
or indirectly, any interest in any other corporation, partnership, association
or other business entity, except as stated in the SEC Reports.
(n) Required Governmental Permits. The Company is in possession of and
operating in compliance with all authorizations, licenses, certificates,
consents, orders and permits from state, federal and other regulatory
authorities which are material to the conduct of its business, all of which are
valid and in full force and effect.
(o) Listing. The Company will use its best efforts to maintain the listing
of its Common Stock on the Nasdaq SmallCap Market or other organized, comparable
United States market or quotation system.
(p) No Issuances Since June 30, 1997. Since June 30, 1997, the Company has
not issued any shares of Common Stock, other than pursuant to the exercise of
stock options under the Company's existing stock option or long-term incentive
plans.
(q) Legal Opinion. Purchaser shall, upon purchase of the Shares, receive an
opinion letter from counsel to the Company, and the Company represents that it
will obtain such an opinion from counsel to the satisfaction of the Purchaser,
to the effect that:
(i) The Company is duly incorporated, validly existing and in good
standing in the jurisdiction of its incorporation.
(ii) There is no action, proceeding or investigation pending, or to
such counsel's knowledge, threatened against the Company, which could
reasonably be expected to materially adversely affect the Company's ability
to consummate the transactions contemplated hereby.
(iii) To such counsel's knowledge, the Company is not a party to or
subject to the provisions of any order, writ, injunction, judgment or
decree of any court or government agency or instrumentality which would
reasonably be expected to result in any material adverse change in the
business, financial condition or results of operations of the Company.
(iv) All issued and outstanding shares of Common Stock have been duly
authorized and validly issued and are fully paid and nonassessable.
(v) This Subscription Agreement, the Registration Rights Agreement (as
defined herein) and the issuance of the Shares have been duly approved by
and required corporate action and that the Shares, upon delivery, shall be
validly issued and outstanding, fully paid and nonassessable.
(vi) The execution, delivery and performance of this Subscription
Agreement and the Registration Rights Agreement by the Company, and the
consummation of the transactions contemplated thereby, will not, with or
without the giving of notice or the passage of time or both:
(A) Violate the provisions of any law, rule or regulation
applicable to the Company,
(B) Violate the provisions of the certificate of incorporation
or bylaws of the Company; or
(C) To such counsel's knowledge, violate any judgment, decree,
order or award of any court, governmental body or
arbitrator.
(D) To such counsel's knowledge, conflict with, or result in
the breach or termination of any term or provision of, or
constitute a default under, or cause any acceleration under,
or cause the creation of any lien, charge or encumbrance
upon the properties or assets of the Company pursuant to,
any note, bond, indenture, mortgage, lease, deed of trust
or other instrument, obligation, or agreement to which the
Company is a party or by which the Company or any of its
properties is or may be bound.
(r) This Subscription Agreement and the Registration Rights Agreement
constitute the valid and legally binding obligations of the Company and are
enforceable against the Company in accordance with their respective terms,
subject to laws of general application relating to bankruptcy, insolvency,
reorganization, arrangement, fraudulent conveyance or transfer, moratorium and
the relief of debtors and rules of law governing specific performance,
injunctive relief or other equitable remedies and general principles of equity,
and, with respect to the Registration Rights Agreement, to limitations of public
policy as they may apply to the indemnification provisions set forth therein.
(s) Use of Proceeds. The Company represents that the net proceeds from this
offering will be used to fund the Company's working capital and general
corporate purposes.
(t) No Poison Pill. The Company represents that it does not have, and has
no current intention to adopt, a stockholder rights plan ("poison pill").
2. Representations, Warranties and Covenants of the Undersigned. The
undersigned hereby represents, warrants and acknowledges to and covenants and
agrees with the Company as follows:
(a) Status. If the undersigned is a corporation or other entity, the
undersigned is a corporation or other entity duly organized, validly existing
and in good standing under the laws of the jurisdiction of its organization with
full power and authority to execute, deliver and perform its obligations under
this Subscription Agreement; and, if the undersigned is an individual or are
individuals, the undersigned has legal capacity to execute, deliver and perform
his, her or their obligations under this Subscription Agreement;
(b) Authority for Agreements. The undersigned has the power and authority
to execute and deliver this Subscription Agreement and to carry out the
undersigned's obligations hereunder; and the execution, delivery and performance
by the undersigned of this Subscription Agreement and the consummation of the
transactions contemplated hereby have been duly authorized by all necessary
action on the part of the undersigned and this Subscription Agreement
constitutes the valid and legally binding obligation of the undersigned,
enforceable against the undersigned in accordance with its terms, except as the
same may be limited by bankruptcy, insolvency, reorganization or other laws
affecting the enforcement of creditors' rights generally now or hereafter in
effect and subject to the application of equitable principles and the
availability of equitable remedies;
(c) Consents and Approvals, No Conflicts.
(i) The execution and delivery of this Subscription Agreement by the
undersigned do not, and the performance by the undersigned of undersigned's
obligations hereunder will not, require any consent, approval,
authorization or other action by, or filing with or notification to, any
governmental or regulatory authority, except where failure to obtain such
consent, approval, authorization or action, or to make such filing or
notification, would not prevent the undersigned from performing any of
undersigned's material obligations under this Subscription Agreement; and
(ii) The execution, delivery and performance of this Subscription
Agreement by the undersigned and the other agreements and agreements to be
executed, delivered and performed by the undersigned pursuant hereto and
the consummation of the transactions contemplated hereby and thereby by the
undersigned do not and will not conflict with, violate or result in a
breach or termination of any provision of, or constitute a default under
(or event which with the giving of notice or lapse of time, or both, would
become a default under) the Certificate of Incorporation or By-laws of the
undersigned (if the undersigned is a corporation), any other organizational
instrument (if the undersigned is a legal entity other than a corporation),
or, except as would not prevent the undersigned from performing any of
undersigned's material obligations under this Subscription Agreement and
would not have a Material Adverse Effect, any law, rule, regulation, order,
writ, judgment, injunction, decree, determination or award applicable to
the undersigned or give to others any rights of termination, amendment,
acceleration or cancellation of, or result in the creation of any lien or
encumbrance on any of the assets or properties of the undersigned pursuant
to, any note, bond, mortgage, indenture, contract, agreement, lease,
license, permit, franchise or other instrument relating to such assets or
properties to which the undersigned is a party or by which any of such
assets or properties is bound;
(d) Investment Intent. The undersigned is acquiring the Shares for the
undersigned's own account, for investment only and not with a view to, or for
sale in connection with, a distribution thereof, within the meaning of the
Securities Act, and the rules and regulations promulgated thereunder, or any
applicable state securities or blue-sky laws;
(e) Investor Status. Either (i) the undersigned is an accredited investor
as such term is defined under Regulation D promulgated pursuant to the
Securities Act ("Regulation D") for the reason(s) as set forth in the Execution
Section of this Subscription Agreement or (ii) if not an accredited investor,
all the information which is set forth with respect to the undersigned in the
Qualified Purchaser Questionnaire executed by the undersigned and delivered to
the Company which is incorporated herein by this reference thereto, and, in
either event, all of the representations and warranties of the undersigned set
forth herein, are correct and complete as of the date of this Subscription
Agreement, shall be true and correct as of the Closing Date and shall survive
such closing; and if there should by any material change in such information
prior to the sale to the undersigned of the Shares, the undersigned will
immediately furnish such revised or corrected information to the Company;
(f) Intent to Transfer. The undersigned is not a party or subject to or
bound by any contract, undertaking, agreement or arrangement with any person to
sell, transfer or pledge the Shares or any part thereof to any person, and has
no present intention to enter into such a contract, undertaking, agreement or
arrangement;
(g) Receipt of Disclosures. The undersigned acknowledges receipt of copies
of the Company's Annual Report on Form 10-KSB for the fiscal year ended December
31, 1996, the Company's Quarterly Report on Form 10-QSB/A for the fiscal quarter
ended March 31, 1997 and the Company's Quarterly Report on Form 10-QSB for the
fiscal quarter ended June 30, 1997;
(h) Offering Exempt from Registration; Company's Reliance.
(i) The Company has advised the undersigned that the Shares have not
been registered under the Securities Act or under the laws of any state on
the basis that the issuance thereof is exempt from such registration;
(ii) The Company's reliance on the availability of such exemption is,
in part, based upon the accuracy and truthfulness of the undersigned's
representations contained herein; and
(iii) As a result of such lack of registration, the Shares may not be
resold or otherwise transferred or disposed without registration pursuant
to or an exemption therefrom available under the Securities Act and such
state securities laws;
(iv) In furtherance of the provisions of this Paragraph 2(h), all of
the certificate(s) representing the Shares shall bear a restrictive legend
substantially in the following form:
"THE SHARES OF COMMON STOCK REPRESENTED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THESE
SHARES 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 SHARES UNDER THE SECURITIES ACT OF
1933, AS AMENDED, AND APPLICABLE STATE SECURITIES LAWS OR AN OPINION
OF COUNSEL SATISFACTORY TO THE ISSUER OF THESE SHARES TO THE EFFECT
THAT REGISTRATION IS NOT REQUIRED UNDER SUCH ACT AND SUCH STATE
SECURITIES LAWS."
(i) Sophistication of the Undersigned. The undersigned has evaluated the
merits and risks of purchasing the Shares and has such knowledge and experience
in financial and business matters that the undersigned is capable of evaluating
the merits and risks of such purchase, is aware of and has considered the
financial risks and financial hazards of purchasing the Shares, and is able to
bear the economic risk of purchasing the Shares, including the possibility of a
complete loss with respect thereto;
(j) Access to Information. The undersigned has had access to such
information regarding the business and finances of the Company, and the offering
of the Shares, the receipt and careful reading of which is hereby acknowledged
by the undersigned, and has been provided the opportunity to discuss with the
Company's management the business, affairs and financial condition of the
Company and such other matters with respect to the Company as would concern a
reasonable person considering the transactions contemplated by this Subscription
Agreement and/or concerned with the operation of the Company including, without
limitation, pursuant to a meeting and/or discussions with management of the
Company;
(k) No Company Obligation to Register the Shares. Except as specifically
provided in the registration rights agreement dated the Closing Date among the
undersigned, the Company and certain other purchasers of shares of Common Stock
(the "Registration Rights Agreement"), the Company is under no obligation to
register the Shares under the Securities Act or to assist the undersigned in
complying with any exemption from registration or in registering the Shares
under the Securities Act;
(l) No Guarantees. That it never has been represented, guaranteed or
warranted to the undersigned by the Company, or any of its officers, directors,
agents, representatives or employees, or any other person, expressly or by
implication, that:
(i) Any gain will be realized by the undersigned from the
undersigned's investment in the Shares;
(ii) That there will be any approximate or exact length of time that
the undersigned will be required to remain as a holder of the
Shares; or
(iii)That the past performance or experience on the part of the
Company, its predecessors or of any other person, will in any
way indicate any future results of the Company;
(m) No Other Representations, Warranties, Covenants or Agreements of the
Company. Except as set forth in this Subscription Agreement or the documents
referred to herein, the Company has not made any representation, warranty,
covenant or agreement with respect to the matters contained herein;
(n) High Degree of Investment Risk. That the purchase of the Shares
involves a high degree of risk and may result in a loss of the entire amount
invested; that the Company has limited working capital and limited sources of
financing available; that there is no assurance that the Company's operations
will be profitable in the future; and that there is no assurance that a public
market for shares of Common Stock will continue to exist;
(o) State of Residence or Principal Place of Business. The address set
forth at the bottom of this Subscription is the undersigned's true and correct
residence (if an individual) or principal place of business (if a corporation or
other non-individual entity), and the undersigned has no present intention of
becoming a resident, or relocating its principal place of business to, of any
other state or jurisdiction;
(p) No Purchaser Representative. The undersigned has not authorized any
person or institution to act as the undersigned's "purchaser representative" (as
such term is defined in Rule 501 of Regulation D) in connection with the
undersigned's subscription being made pursuant to this Subscription Agreement,
except as set forth in any Qualified Purchaser Questionnaire delivered by the
undersigned to the Company in connection herewith;
(q) No General Solicitation. The undersigned has not received any general
solicitation or general advertising regarding the purchase of any of the Shares;
and
(r) No Finder. There is no finder in connection with this transaction other
than ▇▇▇▇▇▇ ▇▇▇▇▇▇ Associates.
(s) No ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇. The undersigned will not engage in any transaction
with respect to securities of the Company at any time if at the time of such
transaction the undersigned is aware of any material non-public information
relating to the Company or its securities.
3. Acceptance or Rejection of Subscription; Company Withdrawal of Offer. It
is understood and agreed that this Subscription Agreement is made subject to the
following terms and conditions:
(a) The Company shall have the right to accept or reject the Subscription
of the undersigned and this Subscription Agreement, in whole or in part, for any
reason, including, but not limited to, ineligibility of the undersigned under
the applicable Federal, state or foreign securities laws, for any other reason,
or for no reason;
(b) If the subscription of the undersigned is rejected, in whole or part,
any funds representing the Subscription Price previously delivered to the
Company will be returned to the undersigned without interest or penalty;
(c) If the subscription of the undersigned is accepted in part and rejected
in part, the undersigned will be so notified, at which time the excess
Subscription Price previously delivered to the Company shall promptly be
returned to the undersigned without interest or penalty;
(d) If the Company's offer of the Shares is withdrawn for any reason
whatsoever, the undersigned will promptly receive a full refund of the
Subscription Price, without interest or penalty, and will have no further
liability to the Company in connection with the Company's offer of the Shares,
and the Company will have no further liability to the undersigned.
4. Further Assurances. At any time and from time to time after the date
hereof, the undersigned shall, without further consideration, execute and
deliver to the Company, or such other party as the Company may direct, such
other instruments or documents and shall take such other actions as the Company
may reasonably request to carry out the transactions contemplated by this
Subscription Agreement.
5. Indemnification. The undersigned acknowledges that the undersigned
understands the meaning and legal consequences of the representations,
warranties, covenants and agreements contained herein, and the undersigned
hereby agrees to indemnify and hold harmless the Company, and its directors,
officers, employees, agents and controlling persons, from and against any and
all loss, damage or liability due to or arising out of a breach by the
undersigned of any such representations, warranties, covenants and agreements
contained herein.
6. Miscellaneous. The Company and undersigned may waive compliance by the
other with any of the provisions of this Subscription Agreement. No waiver of
any provision shall be construed as a waiver of any other provision. Any waiver
must be in writing. The headings contained in this Subscription Agreement are
for reference purposes only and shall not affect in any way the meaning or
interpretation of this Subscription Agreement. This Subscription Agreement
constitutes the entire agreement between the parties hereto with respect to the
subject matter hereof and may be amended only by a writing executed by all
parties. This Subscription Agreement may not be modified or amended except in
writing signed by both parties hereto. This Subscription Agreement may be
executed in several counterparts, each of which shall be deemed an original, and
all of which shall constitute one and the same instrument. This Subscription
Agreement shall be governed in all respects, including validity, interpretation
and effect, by the laws of the State of New York, without regard to its
conflicts of laws principles. This Subscription Agreement shall be binding upon
and inure to the benefit of and be enforceable by the successors and assigns of
the parties hereto. This Subscription Agreement shall not be assignable by
either party without the prior written consent of the other. The rights and
obligations contained in this Subscription Agreement are solely for the benefit
of the parties hereto and are not intended to benefit or be enforceable by any
other party, under the third party beneficiary doctrine or otherwise.
THE SECURITIES BEING OFFERED HEREBY HAVE NOT BEEN REGISTERED OR APPROVED OR
DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES
REGULATORY AUTHORITY OF ANY STATE, NOR HAS THE COMMISSION OR ANY SUCH AUTHORITY
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS SUBSCRIPTION AGREEMENT OR THE
AGREEMENTS AND DOCUMENTS REFERRED TO OR INCORPORATED BY REFERENCE HEREIN
(COLLECTIVELY, THE "OFFERING DOCUMENTS"). ANY REPRESENTATION TO THE CONTRARY IS
UNLAWFUL.
THE SHARES ARE BEING OFFERED BY THE COMPANY IN RELIANCE UPON AN EXCEPTION
FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED, WHICH EXEMPTION
DEPENDS UPON THE EXISTENCE OF CERTAIN FACTS INCLUDING, BUT NOT LIMITED TO, THE
REQUIREMENTS THAT THE SECURITIES ARE NOT BEING OFFERED THROUGH GENERAL
ADVERTISING OR GENERAL SOLICITATION, ADVERTISEMENTS OR COMMUNICATIONS IN
NEWSPAPERS, MAGAZINES OR OTHER MEDIA, OR BROADCASTS ON RADIO OR TELEVISION, AND
THAT THE OFFERING DOCUMENTS SHALL BE TREATED AS CONFIDENTIAL BY THE PERSONS TO
WHOM IT IS DELIVERED. ANY DISTRIBUTION OF THE OFFERING DOCUMENTS OR ANY PART
HEREOF OR DIVULGENCE OF ANY OF ITS CONTENTS SHALL BE UNAUTHORIZED.
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 RISKS INVOLVED. THE SHARES HAVE NOT BEEN RECOMMENDED BY ANY FEDERAL OR STATE
SECURITIES COMMISSION OR REGULATORY AUTHORITY. FURTHERMORE, THE FOREGOING
AUTHORITIES HAVE NOT CONFIRMED THE ACCURACY OR DETERMINED THE ADEQUACY OF THE
OFFERING DOCUMENTS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
THE SHARES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT
BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED, THE APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION OR
EXEMPTION THEREFROM. IN ADDITION, THE SHARES WILL BEAR A LEGEND TO SUCH EFFECT
AS SET FORTH HEREIN. INVESTORS SHOULD BE AWARE THAT THEY MAY BE REQUIRED TO BEAR
THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME.
IN WITNESS WHEREOF, the undersigned has duly executed this Subscription
Agreement as of the date set forth below the undersigned's signature in the
Execution Section below.
EXECUTION SECTION FOR SUBSCRIPTION BY INDIVIDUALS
I. SUBSCRIPTION AMOUNT:
The undersigned subscribes to purchase _______ Shares at a subscription
price of $1.063 per Share or $__________ in the aggregate.
II. SUBSCRIBER STATUS:
The undersigned is (check appropriate box and, if applicable, fill in state
with jurisdiction over custodial account):
___ INDIVIDUAL OWNER (One signature required below). Note: In community
property states, both spouses are required to sign below, whether or not
being listed as co-subscribers.
___ HUSBAND AND WIFE AS TENANTS BY THE ENTIRETY (Husband and wife are both
required to sign below).
___ TWO OR MORE INDIVIDUALS AS TENANTS IN COMMON (All tenants are required to
sign below).
___ TWO OR MORE INDIVIDUALS AS JOINT TENANTS WITH RIGHT OF SURVIVORSHIP (All
tenants are required to sign below).
___ CUSTODIAL ACCOUNT UNDER UNIFORM GIFTS TO MINORS ACT OF THE STATE OF
___________________________________________________ (Fill in state).
III. INFORMATION AS IT IS TO APPEAR ON THE COMPANY RECORDS:
Name of
Subscriber(s): (1) __________________________________________________________
(2) __________________________________________________________
Social Security Number (for use in all notifications
and reports to governmental taxing authorities): ____________________________
State(s) of Permanent Residence: (1) ______________________________________
(2) ______________________________________
Mailing Address: __________________________________________________________
__________________________________________________________
__________________________________________________________
Telephone Number: __________________________________________________________
Facsimile Number: __________________________________________________________
IV. INVESTOR STATUS (check all appropriate boxes):
A. The undersigned is an accredited investor, as such term is defined under
Regulation D, by reason of the fact that the undersigned is:
An individual whose net worth (or joint net worth with my spouse, if
greater) exceeds $1,000,000.
___ An individual with income in excess of $200,000, or joint income
together with my spouse in excess of $300,000, in each of the two most
recent years and reasonably expects to reach the same income level in
the current year.
___ A director or executive officer of the Company.
___ An entity in which all of the equity owners are accredited investors,
as defined in Regulation D. (The Company has the right to request the
names of each such accredited investor equity owners and to require
such person(s) to complete a Qualified Purchaser Questionnaire prior
to the Company's acceptance of the undersigned's subscription.)
___ B. The undersigned is not an accredited investor, as such term is defined
under Regulation D, and agrees, that upon the request of the Company, to
complete a Qualified Purchaser Questionnaire and return an executed copy thereof
to the Company.
___________________
(1) For purposes hereof, net worth shall be deemed to include all of your
assets, liquid or illiquid (including such items as home, furnishings,
automobile and restricted securities), minus any liabilities (including such
items as home mortgages and other debts and liabilities).
(2) For purposes hereof, the term "income" is not limited to "adjusted
gross income" as that term is defined for Federal Income Tax purposes, but
rather includes certain items of income which are deducted in computing
"adjusted gross income." For investors who are salaried employees, the gross
salary of such investor, minus any significant expenses personally incurred by
such investor in connection with earning the salary, plus any income from any
other source, including unearned income is a fair measure of "income" for
purposes hereof. For investors who are self-employed, "income" is generally
construed to mean total revenues received during the calendar year minus
significant expenses incurred in connection with earning such revenues.
V. SIGNATURE(S):
Signature(s) of Subscriber(s): (1) ______________________________________
(2) ______________________________________
Signature of Non-Subscribing Spouse (Community Property States Only):
(1) ______________________________________
(2) ______________________________________
Date: _______________________________________, 1997
EXECUTION SECTION FOR SUBSCRIPTION BY NON-INDIVIDUALS
I. SUBSCRIPTION AMOUNT:
The undersigned subscribes to purchase _______ Shares at a subscription
price of $1.063 per Share or $_________ in the aggregate.
II. SUBSCRIBER STATUS:
The undersigned is (check appropriate box and, if applicable, fill in state
with jurisdiction over custodial account):
___ CORPORATION (Please include certified corporate resolution authorizing
signature).
___ PARTNERSHIP.
___ TRUST.
___ OTHER (Including Employment Benefit Plans and Trusts, Individual Retirement
Accounts, and ▇▇▇▇▇▇ Plans).
III. INFORMATION AS IT IS TO APPEAR ON THE COMPANY RECORDS:
Name of
Subscriber: _______________________________________________________________
Tax Identification Number: ________________________________________________
State of Incorporation or Organization: ______________________________________
State of Principal Place of Business: ______________________________________
Mailing Address: __________________________________________________________
__________________________________________________________
__________________________________________________________
Telephone Number: __________________________________________________________
Facsimile Number: __________________________________________________________
IV. INVESTOR STATUS (check all appropriate boxes and, if applicable, provide
all information requested):
A. The undersigned is an accredited investor, as such term is defined under
Regulation D, by reason of the fact that the undersigned is:
___ A bank as defined in Section 3(a)(2) of the Securities Act, or any
savings and loan association or other institution as defined in
Section 3(a)(5)(A) of the Securities Act whether acting in its
individual or fiduciary capacity; a broker or dealer registered
pursuant to Section 15 of the Securities Exchange Act of ▇▇▇▇ (▇▇▇
"▇▇▇▇▇▇▇▇ ▇▇▇"); an insurance company as defined in Section 2(13) of
the Securities 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, and having
total assets in excess of $5,000,000; an employee benefit plan within
the meaning of the Employee Retirement Income Security Act of 1974
("ERISA") with investment decisions 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; an employee benefit plan within the meaning of ERISA and
having total assets in excess of $5,000,000.
___ An employee benefit plan within the meaning of ERISA which is a
self-directed plan, with investment decisions made solely by the
following persons who are accredited investors, as defined in
Regulation D:
_____________________________________________________________________
_____________________________________________________________________
___ A private business development company as defined in section
202(a)(22) of the Investment Advisers Act of 1940.
___ An organization described in Section 501(c)(3) of the Internal Revenue
Code, 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.
___ A trust, with total assets in excess of $5,000,000, not formed for the
specific purpose of acquiring any Series A Debenture, whose purchase
is directed by the following sophisticated person meeting the
description set forth in Rule 506(b)(2)(ii) of Regulation D:
_____________________________________________________________________
___ An entity in which all of the equity owners are accredited investors,
as defined in Regulation D. (The Company has the right to request the
names of each such accredited investor equity owners and to require
such person(s) to complete a Qualified Purchaser Questionnaire prior
to the Company's acceptance of the undersigned's subscription.)
___ B. The undersigned is not an accredited investor, as such term is defined
under Regulation D, and agrees, that upon the request of the Company, to
complete a Qualified Purchaser Questionnaire and return an executed copy thereof
to the Company.
V. SIGNATURE(S)
The undersigned corporate officer, partner, trustee or fiduciary certifies
that the undersigned has full power and authority from all requisite
stockholders, partners, co-trustees, co-fiduciaries of the subscribing entity
named above to execute this Subscription Agreement on behalf of the subscribing
entity and to make the representations, warranties and agreements made herein on
its and their behalf and that investment in the Shares has been affirmatively
authorized by the governing board or body of such entity and is not prohibited
by law or the governing documents of the subscribing entity.
By:________________________________ By:___________________________________
(Signature of Authorized Signatory) (Signature of Authorized Co-Signatory)
___________________________________ ______________________________________
(Name of Authorized Signatory) (Name of Authorized Co-Signatory)
___________________________________ ______________________________________
(Title of Authorized Signatory) (Title of Authorized Co-Signatory)
Date: _______________________________________, 1997
ACCEPTANCE PAGE
(To be completed by the Company)
SUBSCRIPTION AND SUBSCRIPTION AGREEMENT
ACCEPTED AND AGREED:
Number of Shares for which Subscription is Accepted: ______________________
SOFTWARE PUBLISHING CORPORATION HOLDINGS, INC.
By: _________________________________________
Name:
Title:
Date:_______________________________________, 1997