RESTATED SUBSCRIPTION AGREEMENT
EXHIBIT
10.1
RESTATED SUBSCRIPTION
AGREEMENT
RESTATED SUBSCRIPTION AGREEMENT
made as of this _ day of ________ 2008, between IX Energy Holdings, Inc.,
a Delaware corporation (the "Company"), and the
undersigned (the "Subscriber").
WHEREAS, pursuant to a
Confidential Private Placement Memorandum dated August 22, 2008 (the "PPM"), as
supplemented to date, the Company is offering in a private placement (the "Offering") to accredited
investors a minimum of 35 Units (the "Minimum Offering") and a maximum of
100 Units (the "Maximum
Offering") at a purchase price of $100,000 per Unit, or up to 115 Units
if the Company elects to accept over-subscriptions, with each Unit (the "Units") consisting of 250,000
shares of the Company's common stock, par value $0.001 per share (the "Common Stock"), and a
three-year detachable warrant (the "Warrant") to purchase 250,000
shares of Common Stock with an exercise price of $0.50 per share;
and
WHEREAS, the Subscriber
desires to subscribe for the number of Units set forth on the signature page
hereof, on the terms and conditions hereinafter set forth.
NOW, THEREFORE, for and in
consideration of the premises and the mutual covenants hereinafter set forth,
the parties hereto do hereby agree as follows:
I. SUBSCRIPTION
FOR AND REPRESENTATIONS AND COVENANTS OF SUBSCRIBER
1.1
Subject to the terms and conditions hereinafter set forth, the Subscriber hereby
subscribes for and agrees to purchase from the Company such number of Units set
forth upon the signature page hereof, at a price equal to $100,000 per Unit, and
the Company agrees to sell such to the Subscriber for said purchase price,
subject to the Company's right to sell to the Subscriber such lesser number of
(or no) Units as the Company may, in its sole discretion, deem necessary or
desirable. The purchase price is payable by wire transfer of immediately
available funds, pursuant to the wire instructions attached as Exhibit F to the PPM
or by check payable to LaSalle Bank National Association as Escrow Agent to IX
Energy Holdings, Inc.
1.2 The
Subscriber recognizes that the purchase of Units involves a high degree of risk
in that (i) an investment in the Company is highly speculative and only
investors who can afford the loss of their entire investment should consider
investing in the Company and the Units; (ii) the Units are not registered under
the Securities Act of 1933, as amended (the "Act"), or any state securities law;
(iii) there is no trading market for the Units, none is likely ever to develop,
and the Subscriber may not be able to liquidate his, her or its investment; (iv)
transferability of the Units is extremely limited; and (v) an investor could
suffer the loss of his, her or its entire investment.
1.3 The
Subscriber is an "accredited investor," as such term in defined in Rule 501 of
Regulation D promulgated under the Act, and the Subscriber is able to bear the
economic risk of an investment in the Units.
1.4 The
Subscriber has prior investment experience (including investment in non-listed
and non-registered securities), and has read and evaluated, or has employed the
services of an investment advisor, attorney or accountant to read and evaluate,
all of the documents furnished or made available by the Company to the
Subscriber and to all other prospective investors in the Units, including the
PPM, as well as the merits and risks of such an investment by the Subscriber.
The Subscriber's overall commitment to investments which are not readily
marketable is not disproportionate to the Subscriber's net worth, and the
Subscriber's investment in the Units will not cause such overall commitment to
become excessive. The Subscriber, if an individual, has adequate means of
providing for his or her current needs and personal and family contingencies and
has no need for liquidity in his or her investment in the Units. The Subscriber
is financially able to bear the economic risk of this investment, including the
ability to afford holding the Units for an indefinite period or a complete loss
of this investment.
1
1.5 The
Subscriber acknowledges receipt and careful review of the PPM, all supplements
to the PPM, and all other documents furnished in connection with this
transaction by the Company (collectively, the "Offering Documents") and has
been furnished by the Company during the course of this transaction with all
information regarding the Company which the Subscriber has requested or desires
to know; and the Subscriber has been afforded the opportunity to ask questions
of and receive answers from duly authorized officers or other representatives of
the Company concerning the terms and conditions of the Offering, and any
additional information which the Subscriber has requested.
1.6 The
Subscriber acknowledges that the purchase of the Units may involve tax
consequences to the Subscriber and that the contents of the Offering Documents
do not contain tax advice. The Subscriber acknowledges that the Subscriber must
retain his, her or its own professional advisors to evaluate the tax and other
consequences to the Subscriber of an investment in the Units. The Subscriber
acknowledges that it is the responsibility of the Subscriber to determine the
appropriateness and the merits of a corporate entity to own the Subscriber's
Units and the corporate structure of such entity.
1.7 The
Subscriber acknowledges that this Offering has not been reviewed by the
Securities and Exchange Commission (the "SEC") or any state securities
commission, and that no federal or state agency has made any finding or
determination regarding the fairness or merits of the Offering. The Subscriber
represents that the Units are being purchased for his, her or its own account,
for investment only, and not with a view toward distribution or resale to
others. The Subscriber agrees that he, she or it will not sell or otherwise
transfer the Units unless they are registered under the Act or unless an
exemption from such registration is available.
1.8 The
Subscriber understands that the provisions of Rule 144 under the Act are not
available for at least one (1) year to permit resales of the Units or the Common
Stock and Warrants comprising the Units and there can be no assurance that the
conditions necessary to permit such sales under Rule 144 will ever be satisfied.
The Subscriber understands that the Company is under no obligation to comply
with the conditions of Rule 144 or take any other action necessary in order to
make available any exemption from registration for the sale of the Units or the
Common Stock and Warrants comprising the Units.
1.9 The
Subscriber understands that the Units have not been registered under the Act by
reason of a claimed exemption under the provisions of the Act which depends, in
part, upon his, her or its investment intention. In this connection, the
Subscriber understands that it is the position of the SEC that the statutory
basis for such exemption would not be present if his, her or its representation
merely meant that his, her or its present intention was to hold such securities
for a short period, such as the capital gains period of tax statutes, for a
deferred sale, for a market rise, assuming that a market develops, or for any
other fixed period. The Subscriber realizes that, in the view of the SEC, a
purchase now with an intent to resell would represent a purchase with an intent
inconsistent with his, her or its representation to the Company and the SEC
might regard such a sale or disposition as a deferred sale, for which such
exemption is not available.
1.10 The
Subscriber agrees to indemnify and hold the Company, its directors, officers and
controlling persons and their respective heirs, representatives, successors and
assigns harmless against all liabilities, costs and expenses incurred by them as
a result of any misrepresentation made by the Subscriber contained herein or any
sale or distribution by the Subscriber in violation of the Act (including,
without limitation, the rules promulgated thereunder), any state securities
laws, or the Company's Certificate of Incorporation or By-laws, as amended from
time to time.
2
1.11 The
Subscriber consents to the placement of a legend on any certificate or other
document evidencing the Common Stock or the Warrants stating that such
securities have not been registered under the Act and setting forth or referring
to the restrictions on transferability and sale thereof.
1.12 The
Subscriber understands that the Company will review and rely on this Restated
Subscription Agreement without making any independent investigation; and it is
agreed that the Company reserves the unrestricted right to reject or limit any
subscription and to withdraw the Offering at any time.
1.13 The
Subscriber hereby represents that the address of the Subscriber furnished at the
end of this Restated Subscription Agreement is the undersigned's principal
residence, if the Subscriber is an individual, or its principal business address
if it is a corporation or other entity.
1.14 The
Subscriber acknowledges that if the Subscriber is a Registered Representative of
a Financial Industry Regulatory Authority, Inc. ("FINRA") member firm, the
Subscriber must give such firm the notice required by the FINRA's Conduct Rules,
receipt of which must be acknowledged by such firm on the signature page
hereof.
1.15 The
Subscriber hereby acknowledges that neither the Company nor any persons
associated with the Company who may provide assistance or advice in connection
with the Offering (other than the placement agent, if one is engaged by the
Company) are or are expected to be members or associated persons of members of
the FINRA or registered broker-dealers under any federal or state securities
laws.
1.16 The
Subscriber understands that, pursuant to the terms of the Offering as set forth
in the PPM, the Company must receive subscriptions for 35 Units for an aggregate
purchase price of $3,500,000 in order to close on the sale of any Units and that
persons affiliated with the Company or its consultants, advisors, or placement
agents may subscribe for Common Stock, in which case the Company may accept
subscriptions from such affiliated parties in order to reach the Minimum
Offering; and that, accordingly, no investor should conclude that achieving the
Minimum Offering is the result of any independent assessment of the merits or
advantages of the Offering or the Company made by Subscribers in the Minimum
Offering.
1.17 The
Subscriber hereby represents that, except as expressly set forth in the Offering
Documents, no representations or warranties have been made to the Subscriber by
the Company or any agent, employee or affiliate of the Company and, in entering
into this transaction, the Subscriber is not relying on any information other
than that contained in the Offering Documents and the results of independent
investigation by the Subscriber.
1.18 All
information provided by the Subscriber in the Investor Questionnaire attached as
Exhibit B to
the PPM is true and accurate in all respects, and the Subscriber acknowledges
that the Company will be relying on such information to its possible detriment
in deciding whether the Company can sell these securities to the Subscriber
without giving rise to the loss of the exemption from registration under
applicable securities laws.
3
II. REPRESENTATIONS BY
THE COMPANY
(a) The
Company is a corporation duly incorporated, validly existing and in good
standing under the laws of the State of Delaware and has the corporate power to
conduct the business which it conducts and proposes to conduct.
(b) The
execution, delivery and performance of this Restated Subscription Agreement by
the Company have been duly authorized by the Company and all other corporate
action required to authorize and consummate the offer and sale of the Units has
been duly taken and approved.
(c) The Units
and the underlying Common Stock have been duly and validly authorized and
issued.
(d) The
Company has obtained, or is in the process of obtaining, all licenses, permits
and other governmental authorizations necessary for the conduct of its business,
except where the failure to so obtain such licenses, permits and authorizations
would not have a material adverse effect on the Company. Such licenses, permits
and other governmental authorizations which have been obtained are in full force
and effect, except where the failure to be so would not have a material adverse
effect on the Company, and the Company is in all material respects complying
therewith.
(e) The
Company knows of no pending or threatened legal or governmental proceedings to
which the Company is a party which would materially adversely affect the
business, financial condition or operations of the Company.
(f) The
Company is not in violation of or default under, nor will the execution and
delivery of this Restated Subscription Agreement or the issuance of the Common
Stock, or the consummation of the transactions herein contemplated, result in a
violation of, or constitute a default under, the Company's Certificate of
Incorporation or By-laws, any material obligations, agreements, covenants or
conditions contained in any bond, debenture, note or other evidence of
indebtedness or in any material contract, indenture, mortgage, loan agreement,
lease, joint venture or other agreement or instrument to which the Company is a
party or by which it or any of its properties may be bound or any material
order, rule, regulation, writ, injunction, or decree of any government,
governmental instrumentality or court, domestic or foreign.
III. COVENANTS BY THE
COMPANY
3.1 Until
the earlier of (i) twelve (12) months following the Initial Closing Date (as
defined in the PPM) or (ii) such date that there is an effective registration
statement on file with the SEC covering the resale of all of the shares of
Common Stock issued in the Offering and all shares of Common Stock issuable upon
exercise of the Warrants issued in the Offering, in the event that the Company
issues or sells any shares of Common Stock or any Common Stock Equivalents (as
defined below) pursuant to which shares of Common Stock may be acquired at a
price less than $0.40 per share (a "Lower Price Issuance"), then
the Company shall promptly issue additional shares of Common Stock to the
Subscriber in an amount sufficient that the subscription price paid hereunder,
when divided by the total number of shares issued will result in an actual price
paid per share of Common Stock hereunder equal to such lower price (this is
intended to be a "full ratchet" adjustment). Such adjustment shall be made
successively whenever such an issuance is made. In addition to the foregoing, in
the event of a Lower Price Issuance, the Subscriber shall have the right to
elect to substitute any term or terms of the offering being made in connection
with the Lower Price Issuance for any term of the Offering in connection with
the Common Stock and Warrants (purchased hereunder) owned by the Subscriber as
of the date of such Lower Price Issuance. Notwithstanding the foregoing, this
Section 3.1 shall not apply in respect of an Exempt Issuance (as defined
below).
4
3.2 For
purposes of this Agreement, (i) "Common Stock Equivalents"
means any securities of the Company or any of its subsidiaries which
would entitle the holder thereof to acquire at any time Common Stock, including,
without limitation, any debt, preferred stock, rights, options, warrants or
other instrument that is at any time convertible into or exercisable or
exchangeable for, or otherwise entitles the holder thereof to receive, Common
Stock and (ii) "Exempt
Issuance" means the issuance of (a) shares of Common Stock or options to
employees, officers, directors, or consultants of the Company pursuant to any
stock or option plan duly adopted for such purpose by a majority of the
non-employee members of the Board of Directors of the Company or a majority of
the members of a committee of non-employee directors established, (b) securities
upon the exercise or exchange of or conversion of any securities issued
hereunder and/or other securities exercisable or exchangeable for or convertible
into shares of Common Stock issued and outstanding on the date of this
Agreement, provided that such securities have not been amended since the date of
this Agreement to increase the number of such securities or to decrease the
exercise, exchange or conversion price of such securities; and (c) securities
issued pursuant to acquisitions or strategic transactions approved by a majority
of the disinterested directors of the Company, provided that any such issuance
shall only be to a person which is either an owner of, or an entity that is,
itself or through its subsidiaries, an operating company in a business
synergistic with the business of the Company and in which the Company receives
benefits in addition to the investment of funds, but shall not include a
transaction in which the Company is issuing securities primarily for the purpose
of raising capital or to an entity whose primary business is investing in
securities.
3.3
Absent a prior determination by the non-employee directors of the Company that
it is in the Company's best interest, for a period of 18 months following the
closing of the Merger (as defined in the PPM), the Company shall not (i) issue
or grant more than an aggregate of 12,000,000 options, warrants or shares of
common stock (subject to appropriate adjustments for any stock dividend, stock
split, stock combination, reclassification or similar transaction) to any
employees, officers, directors, or consultants of the Company or (ii) issue any
options having an exercise price that is less than $0.50 per share and subject
to appropriate adjustments for any stock dividend, stock split, stock
combination, reclassification or similar transaction).
IV. TERMS OF
SUBSCRIPTION
4.1
Subject to Section 4.2 hereof, the subscription period will begin as of the date
of the PPM and will terminate at 11:59 PM Eastern Time, on the earlier of
November 30, 2008, the date on which the Maximum Offering is sold or the
Offering is terminated by the Company (the "Termination Date"); provided,
however, that the Termination Date may be extended by up to an additional thirty
(30) days by the Company. The minimum subscription amount is $100,000, although
the Company may, in its discretion, accept subscriptions for less than
$100,000.
4.2 The
Subscriber shall effect a wire transfer in the full amount of the purchase price
for the Units to the Company's escrow account in accordance with the wire
instructions attached as Exhibit F to the PPM
or shall deliver a check in payment of the purchase price for the
Units.
5
4.3
Pending the sale of the Units, all funds paid hereunder shall be deposited by
the Company in escrow with the Company's escrow agent. If the Company shall not
have obtained subscriptions (including this subscription) for the Minimum
Offering on or before the Termination Date (as such date may be extended by the
Company), then this subscription shall be void and all funds paid hereunder by
the Subscriber shall be promptly returned without interest to the Subscriber, to
the same account from which the funds were drawn. If subscriptions are received
and accepted and payment tendered for the Minimum Offering on or prior to the
Termination Date, then all subscription proceeds (less fees and expenses) shall
be paid over to the Company within ten (10) days thereafter or such earlier date
that is one business day after the amount of good funds in escrow equals or
exceeds $3,500,000. In such event, sales of the Units may continue thereafter
until the earlier of the date on which the Maximum Offering is sold and the
Termination Date, with subsequent releases of funds from time to time at the
discretion of the Company.
4.4 The
Subscriber hereby authorizes and directs the Company and its escrow agent to
deliver any certificates or other written instruments representing the Units to
be issued to such Subscriber pursuant to this Restated Subscription Agreement to
the address indicated on the signature page hereof.
4.5 The
Subscriber hereby authorizes and directs the Company and its escrow agent to
return any funds, without interest, for unaccepted subscriptions to the same
account from which the funds were drawn.
4.6 If
the Subscriber is not a United States person, such Subscriber shall immediately
notify the Company and the Subscriber hereby represents that the Subscriber is
satisfied as to the full observance of the laws of its jurisdiction in
connection with any invitation to subscribe for the Units or any use of this
Restated Subscription Agreement, including (i) the legal requirements within its
jurisdiction for the purchase of the Units, (ii) any foreign exchange
restrictions applicable to such purchase, (iii) any governmental or other
consents that may need to be obtained, and (iv) the income tax and other tax
consequences, if any, that may be relevant to the purchase, holding, redemption,
sale or transfer of the Units. Such Subscriber's subscription and payment for,
and continued beneficial ownership of, the Units will not violate any applicable
securities or other laws of the Subscriber's jurisdiction.
V. MISCELLANEOUS
5.1 Any
notice or other communication given hereunder shall be deemed sufficient if in
writing and sent by reputable overnight courier, facsimile (with receipt of
confirmation) or registered or certified mail, return receipt requested,
addressed to the Company, at the address set forth in the first paragraph
hereof, Attention: Chief Executive Officer, facsimile: (▇▇▇) ▇▇▇-▇▇▇▇, and to
the Subscriber at the address or facsimile number indicated on the signature
page hereof. Notices shall be deemed to have been given on the date when mailed
or sent by facsimile transmission or overnight courier, except notices of change
of address, which shall be deemed to have been given when received.
5.2 This
Restated Subscription Agreement shall not be changed, modified or amended except
by a writing signed by both (a) the Company and (b) subscribers in the Offering
holding a majority of the Units issued in the Offering.
5.3 This
Restated Subscription Agreement shall be binding upon and inure to the benefit
of the parties hereto and to their respective heirs, legal representatives,
successors and assigns. This Restated Subscription Agreement sets forth the
entire agreement and understanding between the parties as to the subject matter
hereof and merges and supersedes all prior discussions, agreements and
understandings of any and every nature among them.
6
5.4
Notwithstanding the place where this Restated Subscription Agreement may be
executed by any of the parties hereto, the parties expressly agree that all the
terms and provisions hereof shall be construed in accordance with and governed
by the laws of the State of New York. The parties hereby agree that any dispute
which may arise between them arising out of or in connection with this Restated
Subscription Agreement shall be adjudicated only before a Federal court located
in New York, New York and they hereby submit to the exclusive jurisdiction of
the federal courts located in New York, New York with respect to any action or
legal proceeding commenced by any party, and irrevocably waive any objection
they now or hereafter may have respecting the venue of any such action or
proceeding brought in such a court or respecting the fact that such court is an
inconvenient forum, relating to or arising out of this Restated Subscription
Agreement or any acts or omissions relating to the sale of the securities
hereunder, and consent to the service of process in any such action or legal
proceeding by means of registered or certified mail, return receipt requested,
in care of the address set forth below or such other address as the undersigned
shall furnish in writing to the other. The parties further agree that in the
event of any dispute, action, suit or other proceeding arising out of or in
connection with this Restated Subscription Agreement, the PPM or other matters
related to this subscription brought by a Subscriber (or transferee), the
Company (and each other defendant) shall recover all of such party's attorneys'
fees and costs incurred in each and every action, suit or other proceeding,
including any and all appeals or petitions therefrom. As used herein, attorney's
fees shall be deemed to mean the full and actual costs of any investigation and
of legal services actually performed in connection with the matters involved,
calculated on the basis of the usual fee charged by the attorneys performing
such services.
5.5 This
Restated Subscription Agreement may be executed in counterparts. Upon the
execution and delivery of this Restated Subscription Agreement by the
Subscriber, this Restated Subscription Agreement shall become a binding
obligation of the Subscriber with respect to the purchase of Units as herein
provided; subject, however, to the right hereby reserved by the Company to (i)
enter into the same agreements with other subscribers, (ii) add and/or delete
other persons as subscribers and (iii) reduce the amount of or reject any
subscription.
5.6 The
holding of any provision of this Restated Subscription Agreement to be invalid
or unenforceable by a court of competent jurisdiction shall not affect any other
provision of this Restated Subscription Agreement, which shall remain in full
force and effect.
5.7 It is
agreed that a waiver by either party of a breach of any provision of this
Restated Subscription Agreement shall not operate or be construed as a waiver of
any subsequent breach by that same party.
5.8 The
parties agree to execute and deliver all such further documents, agreements and
instruments and take such other and further actions as may be necessary or
appropriate to carry out the purposes and intent of this Restated Subscription
Agreement.
[Signature
Pages Follow]
7
IN WITNESS WHEREOF, the
parties have executed this Restated Subscription Agreement as of the day and
year first written above.
_________________________________ X
$100,000 for each Unit = $ _________________________.
Number of
Units subscribed
for Aggregate
Purchase Price
Manner
in which Title is to be held (Please Check One):
| 1. |
Individual
|
7. | Trust/Estate/Pension or Profit Sharing Plan | ||
| Date Opened: ___________________ | |||||
| 2. | Joint Tenants with Right of Survivorship | 8. | As a Custodian for _________________________ | ||
| Under the Uniform Gift to Minors Act of the State of | |||||
| _______________________________ | |||||
| 3. | Community Property | 9. | Married with Separate Property | ||
| 4. | Tenants in Common | 10. | ▇▇▇▇▇ | ||
| 5. | Corporation/Partnership/Limited Liability Company | 11. | Tenants by the Entirely | ||
| 6. | ▇▇▇ | 12. |
Foundation described in Section 501(c)(3) of the Internal
|
||
|
Revenue Code of 1986, as
amended.
|
IF
MORE THAN ONE SUBSCRIBER, EACH SUBSCRIBER MUST SIGN:
• INDIVIDUAL
SUBSCRIBERS MUST COMPLETE PAGE 10
• SUBSCRIBERS
WHICH ARE ENTITIES MUST COMPLETE PAGE 11
8
EXECUTION BY NATURAL
PERSONS\
| Exact Name in Which Title is to be Held | |
| __________________________ | __________________________ |
| Name (Please Print) | Name of Additional Subscriber |
| __________________________ | __________________________ |
| Number and Street | Residence: Address of Additional Subscriber |
| __________________________ | __________________________ |
| City, State and Zip Code | City, State and Zip Code |
| __________________________ | __________________________ |
| Social Security Number | Social Security Number |
| __________________________ | __________________________ |
| Telephone Number | Telephone Number |
| __________________________ | __________________________ |
| Fax Number (if available) | Fax Number (if available) |
| __________________________ | __________________________ |
| E-Mail (if available) | E-Mail (if available) |
| __________________________ | __________________________ |
| (Signature) | (Signature of Additional Subscriber) |
|
ACCEPTED
this __ day of __________ 2008, on
behalf of
IX Energy Holdings, Inc.
|
|
| By: ____________________________ | |
|
Name:
Title:
|
EXECUTION BY SUBSCRIBER
WHICH IS AN ENTITY
(Corporation,
Partnership, Trust, Etc.)
_______________________________________________________________________________
Name of
Entity (Please Print)
Date of
Incorporation or Organization:
State of
Principal Office:
Federal
Taxpayer Identification Number:
_________________________________________________
______________________
Office
Address
______________________
City,
State and Zip Code
______________________
Telephone
Number
______________________
Fax
Number (if available)
______________________
E-Mail
(if available)
| [seal] | |
| By: ______________________________ | |
|
Name:
|
|
| Attest: ___________________________ |
Title: (If Entity is
a Corporation)
|
*If
Subscriber is a Registered
Representative
with a FINRA member firm, have the following acknowledgement signed by the
appropriate party:
The
undersigned FINRA member firm acknowledges receipt of the notice required by
Rule 3050 of the FINRA Conduct Rules
| _________________________________ |
ACCEPTED
this ______day of _______
2008,
on behalf of IX Energy Holdings, Inc.
|
| Name of FINRA Firm | |
| By: ______________________________ |
By:
______________________________
|
|
Name:
Title:
|
Name:
Title:
|
9
AMENDMENT NO. 1 TO RESTATED
SUBSCRIPTION AGREEMENT
AMENDMENT
NO. 1. TO RESTATED SUBSCRIPTION AGREEMENT (the "Amendment") made as
of this ____ day of____________2008, between IX Energy Holdings, Inc., a
Delaware corporation (the "Company"), and the
undersigned (the "Subscriber").
WHEREAS,
the Company and the Subscriber are parties to that certain Restated Subscription
Agreement, dated as of November ___, 2008 and Amendment No. 1 to the
Restated Subscription Agreement date as of November ___, 2008 (the "Restated Agreement");
and
WHEREAS,
the Company and the Subscriber desire to amend the Restated Agreement as
provided below. Capitalized terms used herein but not otherwise defined shall
have the meanings ascribed to them in the Original Agreement.
NOW,
THEREFORE, in consideration of the premises, and for other good and valuable
consideration, the receipt and legal sufficiency of which hereby are
acknowledged, the parties hereby agree as follows:
1. Description of the
Offering. The first WHEREAS clause in the Original Agreement is deleted
and replaced in its entirety with the following:
WHEREAS, pursuant to a
Confidential Private Placement Memorandum dated August 22, 2008, as amended to
date (the "PPM"), the Company is offering in a private placement (the "Offering") to accredited
investors a minimum of 20 Units (the "Minimum Offering") and a
maximum of 100 Units (the "Maximum Offering") at a purchase price
of $100,000 per Unit, or up to 115 Units if the Company elects to accept
over-subscriptions, with each Unit (the "Units") consisting of 250,000
shares of the Company's common stock, par value $0.001 per share (the "Common Stock"), and a
three-year detachable warrant (the "Warrant") to purchase 250,000
shares of Common Stock with an exercise price of $0.50 per share;
and
2. Subscriber
Representation. Section 1.16 appearing under the heading "I. Subscription
for and Representations and Covenants of Subscriber" is deleted and replaced in
its entirety with the following:
1.16 The
Subscriber understands that, pursuant to the terms of the Offering as set forth
in the PPM, the Company must receive subscriptions for 20 Units for an aggregate
purchase price of $2,000,000 in order to close on the sale of any Units and that
persons affiliated with the Company or its consultants, advisors, or placement
agents may subscribe for Common Stock, in which case the Company may accept
subscriptions from such affiliated parties in order to reach the Minimum
Offering; and that, accordingly, no investor should conclude that achieving the
Minimum Offering is the result of any independent assessment of the merits or
advantages of the Offering or the Company made by Subscribers in the Minimum
Offering.
10
3. Price Protection.
Section 3.1 appearing under the heading "I. Subscriptions for and
Representations and Covenants of Subscriber " is deleted and replaced in its
entirety with the following:
3.1 For
twenty four (24) months following the Initial Closing Date (as defined in the
PPM), in the event that the Company issues or sells any shares of Common Stock
or any Common Stock Equivalents (as defined below) pursuant to which shares of
Common Stock may be acquired at a price less than $0.40 per share (a "Lower
Price Issuance"), then the Company shall promptly issue additional shares of
Common Stock to the Subscriber in an amount sufficient that the subscription
price paid hereunder, when divided by the total number of shares issued will
result in an actual price paid per share of Common Stock hereunder equal to such
lower price (this is intended to be a "full ratchet" adjustment). Such
adjustment shall be made successively whenever such an issuance is made. In
addition to the foregoing, in the event of a Lower Price Issuance, the
Subscriber shall have the right to elect to substitute any term or terms of the
offering being made in connection with the Lower Price Issuance for any term of
the Offering in connection with the Common Stock and Warrants (purchased
hereunder) owned by the Subscriber as of the date of such Lower Price Issuance.
Notwithstanding the foregoing, this Section 3.1 shall not apply in respect of an
Exempt Issuance (as defined below).
4. Escrow. Section 4.3
appearing under the heading "IV. Terms of Subscription" in the Subscription
Agreements is deleted and replaced in its entirety with the
following:
4.3
Pending the sale of the Units, all funds paid hereunder shall be deposited by
the Company in escrow with the Company's escrow agent. If the Company shall not
have obtained subscriptions (including this subscription) for the Minimum
Offering on or before the Termination Date (as such date may be extended by the
Company), then this subscription shall be void and all funds paid hereunder by
the Subscriber shall be promptly returned without interest to the Subscriber, to
the same account from which the funds were drawn. If subscriptions are received
and accepted and payment tendered for the Minimum Offering on or prior to the
Termination Date, then all subscription proceeds (less fees and expenses) shall
be paid over to the Company within ten (10) days thereafter. In such event,
sales of the Units may continue thereafter until the earlier of the date on
which the Maximum Offering is sold and the Termination Date, with subsequent
releases of funds from time to time at the discretion of the
Company.
11
IN
WITNESS WHEREOF, the Company and the Subscriber have executed this Amendment as
of the ___day of November 2008.
| IX ENERGY HOLDINGS, INC. | |
| By:_______________________ | |
|
Name:
▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title:
Chief Executive Officer
|
|
| SUBSCRIBER | |
| __________________________ | |
| Name of Subscriber | |
| By: _______________________ | |
| Title:______________________ |
12
AMENDMENT NO. 2 TO RESTATED
SUBSCRIPTION AGREEMENT
AMENDMENT
NO. 2. TO RESTATED SUBSCRIPTION AGREEMENT (the "Amendment") made as
of this ____ day of____________2008, between IX Energy Holdings, Inc., a
Delaware corporation (the "Company"), and the
undersigned (the "Subscriber").
WHEREAS,
the Company and the Subscriber are parties to that certain Restated Subscription
Agreement, dated as of November ___, 2008 and Amendment No. 1 to the
Restated Subscription Agreement date as of November ___, 2008 (the "Restated Agreement");
and
WHEREAS,
the Company and the Subscriber desire to amend the Restated Agreement as
provided below. Capitalized terms used herein but not otherwise defined shall
have the meanings ascribed to them in the Original Agreement.
NOW,
THEREFORE, in consideration of the premises, and for other good and valuable
consideration, the receipt and legal sufficiency of which hereby are
acknowledged, the parties hereby agree as follows:
5. Description of the
Offering. The first WHEREAS clause in the Original Agreement is deleted
and replaced in its entirety with the following:
WHEREAS, pursuant to a
Confidential Private Placement Memorandum dated August 22, 2008, as amended to
date (the "PPM"), the Company is offering in a private placement (the "Offering") to accredited
investors a minimum of 27.5 Units (the "Minimum Offering") and a
maximum of 100 Units (the "Maximum Offering") at a purchase price
of $100,000 per Unit, or up to 115 Units if the Company elects to accept
over-subscriptions, with each Unit (the "Units") consisting of 250,000
shares of the Company's common stock, par value $0.001 per share (the "Common Stock"), and a
three-year detachable warrant (the "Warrant") to purchase 250,000
shares of Common Stock with an exercise price of $0.50 per share;
and
6. Subscriber
Representation. Section 1.16 appearing under the heading "I. Subscription
for and Representations and Covenants of Subscriber" is deleted and replaced in
its entirety with the following:
1.16 The
Subscriber understands that, pursuant to the terms of the Offering as set forth
in the PPM, the Company must receive subscriptions for 27.5 Units for an
aggregate purchase price of $2,750,000 in order to close on the sale of any
Units and that persons affiliated with the Company or its consultants, advisors,
or placement agents may subscribe for Common Stock, in which case the Company
may accept subscriptions from such affiliated parties in order to reach the
Minimum Offering; and that, accordingly, no investor should conclude that
achieving the Minimum Offering is the result of any independent assessment of
the merits or advantages of the Offering or the Company made by Subscribers in
the Minimum Offering.
13
7. Section
3.2 appearing under the heading "III. Covenants by the Company" is deleted and
replaced in its entirety with the following:
3.2 For
purposes of this Agreement, (i) “Common Stock Equivalents”
means any securities of the Company or any of its subsidiaries which would
entitle the holder thereof to acquire at any time Common Stock, including,
without limitation, any debt, preferred stock, rights, options, warrants or
other instrument that is at any time convertible into or exercisable or
exchangeable for, or otherwise entitles the holder thereof to receive, Common
Stock and (ii) “Exempt
Issuance” means the issuance of (a) shares of Common Stock or options to
employees, officers, directors, or consultants of the Company pursuant to any
stock or option plan duly adopted for such purpose by a vote of a majority of
the members of the Board of Directors of the Company, (b) securities upon the
exercise or exchange of or conversion of any securities issued hereunder and/or
other securities exercisable or exchangeable for or convertible into shares of
Common Stock issued and outstanding on the date of this Agreement, provided that
such securities have not been amended since the date of this Agreement to
increase the number of such securities or to decrease the exercise, exchange or
conversion price of such securities; and (c) securities issued pursuant to
acquisitions or strategic transactions approved by a majority of the
disinterested directors of the Company, provided that any such issuance shall
only be to a person which is either an owner of, or an entity that is, itself or
through its subsidiaries, an operating company in a business synergistic with
the business of the Company and in which the Company receives benefits in
addition to the investment of funds, but shall not include a transaction in
which the Company is issuing securities primarily for the purpose of raising
capital or to an entity whose primary business is investing in
securities.
IN
WITNESS WHEREOF, the Company and the Subscriber have executed this Amendment as
of the ___day of December 2008.
| IX ENERGY HOLDINGS, INC. | |
| By:_______________________ | |
|
Name:
▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title:
Chief Executive Officer
|
|
| SUBSCRIBER | |
| __________________________ | |
| Name of Subscriber | |
| By: _______________________ | |
| Title:______________________ |
14