EXHIBIT 10.1 EXHIBIT A
PROCERA NETWORKS, INC.
SUBSCRIPTION AGREEMENT
Restricted Common Stock at $[X.XX] per Share
1.Subscription:
(a) The undersigned (individually and/or
collectively, the “Participant”) hereby applies to
purchase shares of restricted common stock (the "Shares" or the
“Common Stock”) of Procera Networks, Inc., a Nevada
corporation (the “Company”), in accordance with the
terms and conditions of this Subscription Agreement (the
“Subscription”) and the Confidential Private Placement
Memorandum, dated August 4, 2008, to which this Subscription is
attached (the “Memorandum”).
(b) Before this Subscription is considered,
the Participant must complete, execute and deliver to the Company
the following:
(i) This
Subscription;
(ii) The
Certificate of Accredited Investor Status, attached to the this
Subscription Agreement as Exhibit A and to the PPM as Exhibit B;
and
(iii) The
Participant’s check in the amount of $[X.XX] in exchange for
[XXX] Shares purchased (at a price per share of $[X.XX]) net to the
Company, or wire transfer sent according to the Company’s
instructions:
(c) This Subscription is irrevocable by the
Participant.
(d) This Subscription is not transferable or
assignable by the Participant.
(e) This Subscription may be rejected in
whole or in part by the Company in its sole
discretion. In the event this Subscription is rejected
by the Company, all funds and documents tendered by the Participant
shall be returned.
(f) The Company’s may choose to
employ one or more placement agents, and/or other advisors, broker
dealers and/or finders, (collectively “Placement
Agents”). In the event the Company uses one or more Placement
Agents, such Placement Agent(s) shall receive commissions , fees
and other consideration by the Company individually and in
aggregate of not greater than (i) Seven and one half
Percent (7.5%) of Participant’s investment amount, and (ii) a
warrant to purchase shares of common stock of the Company equal to
Three Percent (3%) of the total Shares purchased by Participant, at
an exercise price equal to $1.75 per share. All cash
commissions are costs to the Participant in addition to the net
$[X.XX] per share to the Company.
(g) This Offering, as defined in the
Memorandum, is scheduled to close no later than August 29, 2008 at
5:00 P.M. Pacific Standard Time (the “Closing Date”),
provided, however, that the Company, at its sole election, may
extend this Offering up to an additional sixty days. The
Target Offering is for up to 10,000,000 Shares ($11,000,000) and an
additional over-allotment at the Company’s discretion of up
to 5,000,000 Shares ($5,500,000), but this Offering has no
prescribed minimum amount and the Company may accept lessor amounts
from investors or have multiple closings of this Offering.
(h) Participant hereby agrees not to, and
will cause its affiliates not to, enter into any “put
equivalent position” as such term is defined in Rule 16a-1
under the Securities Exchange Act of 1934, as amended, or short
sale position with respect to the Common Stock.
2.Representations by Participant. In consideration of
the Company’s acceptance of the Subscription, Participant
makes the following representations and warranties to the Company
and to its principals, jointly and severally, which warranties and
representations shall survive any acceptance of the Subscription by
the Company:
(a) Prior to the time of purchase of any
Shares, Participant received a copy of the
Memorandum. Participant has reviewed the Memorandum and
the Company’s filings with the Securities and Exchange
Commission (the “Public
Information”). Participant has had the opportunity
to ask questions and receive any additional information from
persons acting on behalf of the Company to verify
Participant’s understanding of the terms thereof and of the
Company’s business and status thereof. Participant
acknowledges that no officer, director, broker-dealer, placement
agent, finder or other person affiliated with the Company has given
Participant any information or made any representations, oral or
written, other than as provided in the Memorandum and the Public
Information, on which Participant has relied upon in deciding to
invest in the Shares, including without limitation, any information
with respect to future operations of the Company or the economic
returns which may accrue as a result of the purchase of the
Shares.
(b) Participant acknowledges that
Participant has not seen, received, been presented with, or been
solicited by any leaflet, public promotional meeting, newspaper or
magazine article or advertisement, radio or television
advertisement, or any other form of advertising or general
solicitation with respect to the Shares.
(c)The Shares are being purchased for Participant’s own
account for long-term investment and not with a view to immediately
re-sell the Shares. No other person or entity will have
any direct or indirect beneficial interest in, or right to, the
Shares. Participant or its agents or investment advisors
have such knowledge and experience in financial and business
matters that will enable Participant to utilize the information
made available to it in connection with the purchase of the Shares
to evaluate the merits and risks thereof and to make an informed
investment decision.
(d) Participant acknowledges that the Shares
have not been registered under the Securities Act of 1933, as
amended (the "Securities Act"), or qualified under the California
Securities Law, or any other applicable blue sky laws, in reliance,
in part, on Participant’s representations, warranties and
agreements made herein.
(e) Participant represents, warrants and
agrees that the Company and the officers of the Company (the
“Company’s Officers”) are under no obligation to
register or qualify the Shares under the Securities Act or under
any state securities law, or to assist the undersigned in complying
with any exemption from registration and qualification.
(f) Participant represents that
Participant meets the criteria for participation because: (i)
Participant has a preexisting personal or business relationship
with the Company or one or more of its partners, officers,
directors or controlling persons; or (ii) by reason of
Participant’s business or financial experience, or by reason
of the business or financial experience of its financial advisors
who are unaffiliated with, and are not compensated, directly or
indirectly, by the Company or any affiliate or selling agent of the
Company, Participant is capable of evaluating the risk and merits
of an investment in the Shares and of protecting its own
interests;
(g) Participant represents that Participant
is an “accredited investor” within the meaning of Rule
501 of Regulation D under the Securities Act and Participant has
executed the Certificate of Accredited Investor Status, attached
hereto as Exhibit A.
(h) Participant understands that the Shares
are illiquid and will not be registered under the Securities Act,
and until an exemption from registration becomes available, cannot
be readily sold as there will not be a public market for them, and
that Participant may not be able to sell or dispose of the Shares,
or to utilize the Shares as collateral for a
loan. Participant must not purchase the Shares unless
Participant has liquid assets sufficient to assure Participant that
such purchase will cause it no undue financial difficulties, and
that Participant can still provide for current and possible
personal contingencies, and that the commitment herein for the
Shares, combined with other investments of Participant, is
reasonable in relation to its net worth.
(i) Participant understands that the
right to transfer the Shares will be restricted unless the transfer
is not in violation of the Securities Act, the California
Securities Law, and any other applicable state securities laws
(including investment suitability standards), that the Company will
not consent to a transfer of the Shares unless the transferee
represents that such transferee meets the financial suitability
standards required of an initial participant, and that the Company
has the right, in its absolute discretion, to refuse to consent to
such transfer.
(j) Participant has been advised to
consult with its own attorney or attorneys regarding all legal
matters concerning an investment in the Company and the tax
consequences of purchasing the Shares, and have done so, to the
extent Participant considers necessary.
(k) Participant acknowledges that the tax
consequences of investing in the Company will depend on particular
circumstances, and neither the Company, the Company’s
Officers, any other investors, nor the partners, shareholders,
members, managers, agents, officers, directors, employees,
affiliates or consultants of any of them, will be responsible or
liable for the tax consequences to Participant of an investment in
the Company. Participant will look solely to and rely
upon its own advisers with respect to the tax consequences of this
investment
(l) All information which Participant
has provided to the Company concerning Participant, its financial
position and its knowledge of financial and business matters, and
any information found in the Certificate of Accredited Investor
Status, is truthful, accurate, correct, and complete as of the date
set forth herein. (m) Each Participant hereby: (i)
acknowledges that it has received all the information it has
requested from the Company and it considers necessary or
appropriate for deciding whether to acquire the Shares, (ii)
represents that it has had an opportunity to ask questions and
receive answers from the Company regarding the terms and conditions
of the offering of the Shares and to obtain any additional info
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