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SUBSCRIPTION AGREEMENT

Subscription Services Agreement

SUBSCRIPTION AGREEMENT | Document Parties: ARISTON GLOBAL HOLDING LLC You are currently viewing:
This Subscription Services Agreement involves

ARISTON GLOBAL HOLDING LLC

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Title: SUBSCRIPTION AGREEMENT
Governing Law: New York     Date: 7/16/2008
Industry: Computer Networks     Sector: Technology

SUBSCRIPTION AGREEMENT, Parties: ariston global holding llc
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Exhibit 10.1

 

This SUBSCRIPTION AGREEMENT is made and entered into as of July 11, 2008 (this “ Agreement ”), by and between ACE*COMM CORPORATION, a Maryland corporation (the “ Corporation ”), and ARISTON GLOBAL HOLDING LLC, a Delaware limited liability company (the “ Investor ”).

 

WHEREAS, the Agreement and Plan of Merger (the “ Merger Agreement ”) by and among the Corporation, the Investor and Ariston Global Merger Sub, Inc., dated the date hereof, contemplates that the Investor will make an equity investment in the Company;

 

WHEREAS, subject to the terms and conditions set forth in this Agreement and pursuant to Section 4(2) of the Securities Act of 1933 (the “ Securities Act ”), and Regulation D promulgated thereunder, the Corporation desires to issue and sell to the Investor, and the Investor desires to purchase from the Corporation, 714,286 shares of common stock, par value $0.01 per share, of the Corporation (the “ Common Stock ”) pursuant to the terms set forth herein.

 

NOW, THEREFORE, IN CONSIDERATION of the mutual covenants contained in this Agreement, and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the Corporation and the Investor agree as follows:

1.

SUBSCRIPTION

 

1.1.

Purchase of Shares

Subject to the terms and conditions set forth in this Agreement, at the Closing (as defined below), the Corporation shall sell to the Investor, and the Investor shall purchase from the Corporation, 714,286 shares of Common Stock (the “ Shares” ) at a purchase price per share equal to $0.56, for an aggregate purchase price of $400,000 (the “ Purchase Price ”), to be paid by wire transfer or immediately available funds to the Corporation at the Closing. The Closing shall take place simultaneously with the signing of this Agreement on the date hereof at such time and place as the parties may agree (the “ Closing ”). A certificate evidencing the Shares shall be delivered by the Corporation to the Investor reasonably promptly following the Closing.

2.

CORPORATION REPRESENTATIONS   AND   WARRANTIES

 

The Corporation hereby represents and warrants to the Investor that:

 

 

2.1.

Organization   and   Standing

The Corporation is a corporation duly organized, validly existing and in good standing under the laws of the State of Maryland and has all requisite power and authority to execute and deliver this Agreement and to carry out the transactions contemplated hereby. The

 

 

 

 



 

Corporation is duly qualified to transact business, and is in good standing, in each jurisdiction in which the failure to so qualify would have a material adverse effect on its business. The Corporation has all requisite power and authority to own, lease and operate its assets and properties and to carry on its business.

 

2.2.

Capitalization

The authorized capital stock of the Corporation consists of 45,000,000 shares of Common Stock, par value $0.01 per share, of which 19,473,852 shares are issued and outstanding as of the date hereof without taking into account the issuance of the Shares hereunder and (ii) 5,000,000 shares of preferred stock, par value $.01 per share, of which no shares are issued and outstanding as of the date hereof.

 

2.3.

Authorization

The execution, delivery and performance of this Agreement by the Corporation, the fulfillment of and compliance with the respective terms and provisions hereof, and the due consummation of the transactions contemplated hereby have been duly and validly authorized by all necessary corporate action on the part of the Corporation (none of which actions has been modified or rescinded, and all of which actions are in full force and effect).

 

2.4.

Binding   Obligation

This Agreement constitutes a valid and binding obligation of the Corporation, enforceable in accordance with its terms.

 

2.5.

Title   to   Stock

Upon payment by the Investor of the Purchase Price and delivery by the Corporation to the Investor of a certificate for the Shares, the Shares will be duly authorized, validly issued and outstanding, fully paid and nonassessable, and the Investor will acquire good, valid and marketable title thereto, free and clear of all mortgages, liens, pledges, charges, claims, security interests, agreements, encumbrances and equities whatsoever (other than any created by the Investor).

 

2.6.

Consents

The Corporation is not subject to any law, ordinance, regulation, rule, order, judgment, injunction, decree, charter, bylaw, contract, commitment, lease, agreement, instrument or other restriction of any kind that would prevent the Corporation’s consummation of this Agreement or any of the transactions contemplated hereby without the consent of any third party or that would result in any penalty, forfeiture or other termination as a result of such consummation (except, in each case, to the extent that consents or waivers have been obtained).

 

2.7.

Absence   of   Violation

Neither the execution or delivery of this Agreement by the Corporation nor the consummation of the transactions contemplated hereby by the Corporation constitutes a violation or default under or conflicts with, or will result in the creation of any encumbrance on any of the

 

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assets owned by the Corporation under, any term or provision of the Articles of Amendment and Restatement or Bylaws of the Corporation, or any material contract, commitment, lease, instrument, or agreement to which the Corporation is a party or by which the Corporation is bound.

 

2.8.

SEC Reports

Since July 1, 2007, the Corporation has filed all reports required to be filed by it under the Securities Act and the Securities Exchange Act of 1934, as amended (the “ Exchange Act ”), including pursuant to Section 13(a) or 15(d) thereof (the foregoing materials being collectively referred to herein as the “ SEC Reports ”). All such reports were filed on a timely basis (including where applicable prior to expiration of a valid extension of such time of filing). As of their respective dates, the SEC Reports complied in all material respects with the requirements of the Securities Act and the Exchange Act and the rules and regulations of the Securities and Exchange Commission (the “ Commission ”) promulgated thereunder, and none of the SEC Reports, when filed, contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading.

 

2.9.

Securities Act

Subject to the accuracy of the representations and warranties of the Investor contained herein, it is not necessary in connection with the offer, sale and delivery of the Securities in the manner contemplated by this Agreement to register the Shares under the Securities Act.

 

2.10.

General Solicitation

Within the preceding six months, other than pursuant to an effective registration statement on Form S-8, neither the Corporation, any affiliate of the Corporation nor any person acting on its or their behalf has sold any shares of Common Stock by means of any general solicitation or general advertising within the meaning of Rule 502(c) under the Securities Act or offered or sold any shares of Common Stock outside the United States to non-U.S. persons (as defined in Rule 902 under the Securities Act).

 

2.11.

Integration

Within the preceding six months, neither the Corporation nor any other person acting on behalf of the Corporation has sold to any person any shares of Common Stock other than the Shares offered or sold to the Investor hereunder other than pursuant to an effective registration statement on Form S-8. The Corporation will take reasonable precautions designed to ensure that any offer or sale, direct or indirect, of any shares of Common Stock or any substantially similar security issued by the Corporation, within six months subsequent to the Closing, is made under restrictions and other circumstances reasonably designed not to affect the status of the offer and sale of the Shares contemplated by this Agreement as transactions exempt from the registration provisions of the Securities Act.

 

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2.12.

No Brokers

No broker, finder, commission agent or other person is entitled to be paid by the Corporation any broker's fee or commission in connection with the sale of the Shares and the transactions contemplated by this Agreement.

 

3.

INVESTOR REPRESENTATIONS AND   WARRANTIES  

 

The Investor hereby represents and warrants to the Corporation that:

 

3.1.

Organization   and   Standing; Legal Capacity

The Investor is duly organized, validly existing and in good standing under the laws of the jurisdiction of its formation and has all requisite power and authority to own, lease and operate its assets, properties and business; to carry on its business as now conducted; to execute and deliver this Agreement; and to perform fully its obligations hereunder.

 

3.2.

Authorization

The execution, delivery and performance of this Agreement by the Investor, the fulfillment of and the compliance with the respective terms and provisions hereof, and the due consummation of the transactions contemplated hereby have been duly and validly authorized by all necessary limited liability company action on the part of the Investor (none of which actions have been modified or rescinded, and all of which actions are in full force and effect).

 

3.3.

Binding   Obligation

This Agreement constitutes a valid and binding obligation of the Investor, enforceable in accordance with its terms.

 

3.4.

Consents

The Investor is not subject to any law, ordinance, regulation, rule, order, judgment, injunction, decree, charter, bylaw, contract, commitment, lease, agreement, instrument or other restriction of any kind that would prevent the Investor’s consummation of this Agreement or any of the transactions contemplated hereby without the consent of any third party, that would require the consent of any third party to the consummation of this Agreement or any of the transactions contemplated hereby, or that would result in any penalty, forfeiture or other termination as a result of such consummation (except, in each case, to the extent that consents and/or waivers have been obtained).

 

3.5.

Absence   of   Violation

Neither the execution, delivery or performance of this Agreement by the Investor nor the consummation by the Investor of the transactions contemplated hereby constitutes or will constitute a violation or default under or conflicts with or will conflict with, or will result in the creation of any encumbrance on any of the assets owned by the Investor under, any term or provision of the organizational documents of the Investor, if the Investor is an Entity, or any

 

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material contract, commitment, lease, instrument, or agreement to which the Investor is a party or by which the Investor is bound.

 

3.6.

Purchase Entirely for Own Account

 

The Shares will be acquired for the Investor’s own account for investment purposes and not with a view to distributing or reselling such Shares or any part thereof in violation of applicable securities laws, without prejudice, however, to the Investor’s right at all times to sell or otherwise dispose of all or any part of the Shares in compliance with applicable federal and state securities laws. Nothing contained herein shall be deemed a representation or warranty by such Investor to hold the Shares for any period of time. The Investor understands that the Shares have not been registered under the Securities Act, and therefore the Shares may not be sold, assigned or transferred unless pursuant to (i) a registration statement under the Securities Act is in effect with respect thereto or (ii) an available exemption from the registration requirements of the Securities Act.

 

3.7.

Investment Experience

 

The Investor, either alone or together with its representatives, has such knowledge, sophistication and experience in business and financial matters so as to be capable of evaluating the merits and risks of the prospective investment in the Shares, and has so evaluated the merits and risks of such investment. The Investor is able to bear the economic risk of an investment in the Shares and, at the present time, is able to afford a complete loss of such investment.

 

3.8.

Restricted Shares

 

The Investor understands that the Shares are characterized as “restricted securities” under the federal securities laws inasmuch as they are being acquired from the Corporation in a transaction not involving a public offering and that under such laws and applicable regulations such securities may not be resold without registration under the Act, except in certain limited circumstances. The Investor is familiar with Rule 144 promulgated under the Act, as presently in effect, and understands the resale limitations imposed thereby and by the Act.

 

3.9.

Legends

 

The Investor understands that the certificates evidencing the Shares will bear the following, or a substantially similar, legend:

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“THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR ANY OTHER FEDERAL OR STATE SECURITIES LAWS. THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF A REGISTRATION STATEMENT IN EFFECT WITH RESPECT TO THE SECURITIES UNDER SUCH ACT OR AN OPINION OF COUNSEL SATISFACTORY TO THE CORPORATION THAT SUCH REGISTRATION IS NOT REQUIRED.”

 

 

3.10.

Accredited Investor

 

At the time the Investor was offered the Shares, it was, and at the date hereof it is, an “accredited investor” as defined in Rule 501(a) under the Securities Act. The Investor is not a registered broker-dealer under Section 15 of the Exchange Act.

 

3.11.

General Solicitation

 

The Investor is not purchasing the Shares as a result of any advertisement, article, notice or other communication regarding the Shares published in any newspaper, magazine or similar media or broadcast over television or radio or presented at any seminar or any other general solicitation or general advertisement.

 

3.12.

Availability of Funds

The Investor has adequate committed funds to satisfy at Closing all of its obligations hereunder.

4.

REGISTRATION RIGHTS

 

 

4.1.

Shelf Registration.

 

4.1.1.   In the event the Merger Agreement is terminated in accordance with its terms (such date of termination, the “ Termination Date ”), no later than 45 days following the Termination Date (such 45 th day referred to herein as the “ Filing Date ”), the Corporation shall prepare and file with the Commission a Registration Statement on an appropriate form of registration statement covering the resale of all Shares for an offering to be made on a continuous basis pursuant to Rule 415. The Registration Statement shall contain (except if otherwise directed by the Investor) the “ Plan of Distribution ,” substantially as attached hereto as Exhibit A . In the event Form S-3 is not available for the registration of the resale of Shares hereunder, the Corporation shall (i) register the resale of the Shares on another appropriate form in accordance herewith and (ii) attempt to register the Shares on Form S-3 as soon as such form is available, provided that the Corporation shall maintain the effectiveness of the Registration Statement then in effect until such time as a Registration Statement on Form S-3 covering the Shares has been declared effective by the Commission.

 

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4.1.2.   The Corporation shall use reasonable best efforts to cause the Registration Statement to be declared effective by the Commission as promptly as possible after the filing thereof (the date of such effectiveness, the “ Effective Date ”) but in any event within 120 days following the Termination Date (such 120 th day referred to herein as the “ Required Effectiveness Date ”), and shall use reasonable best efforts to keep the Registration Statement continuously effective under the Securities Act until the earlier of (i) the fifth anniversary of the Effective Date, (ii) such time as all Shares covered by the Registration Statement have been sold publicly or (iii) such time as all of the Shares covered by the Registration Statement may be sold pursuant to Rule 144 as determined by counsel to the Corporation pursuant to a written opinion letter to such effect (the A “Effectiveness Period” ).

 

4.1.3.   The Corporation shall notify the Investor in writing promptly after receiving notification from the Commission that the Registration Statement has been declared effective.

 

 

4.2.

Registration Procedures.

 

In connection with the Corporation’s registration obligations hereunder, the Corporation shall:

 

4.2.1.   Not less than six business days prior to the filing of the Registration Statement or any related prospectus (a “ Prospectus ”) or any amendment or supplement thereto (including any document that would be incorporated or deemed to be incorporated therein by reference), furnish to the Investor copies of all such documents proposed to be filed, which documents (other than those incorporated or deemed to be incorporated by reference) will be subject to the review of the Investor. The Corporation shall not file the Registration Statement or any Prospectus or any amendments or supplements thereto to which the Investor shall reasonably object.

 

4.2.2.   (i) Prepare and file with the Commission such amendments, including post-effective amendments, to the Registration Statement and the Prospectus used in connection therewith as may be necessary to keep the Registration Statement continuously effective as to the applicable Shares for the Effectiveness Period; (ii) cause any related Prospectus to be amended or supplemented by any required Prospectus supplement, and as so supplemented or amended to be filed pursuant to Rule 424; (iii) respond as promptly as reasonably possible to any comments received from the Commission with respect to the Registration Statement or any amendment thereto and as promptly as reasonably possible provide the Investor true and complete copies of all correspondence from and to the Commission relating to the Registration Statement; provided, however, the Corporation will not be required to provide copies of any correspondence that would result in the disclosure to the Investor of material and non-public information concerning the Corporation unless the Investor has executed a confidentiality agreement with the Corporation; and (iv) comply in all material respects with the provisions of the Securities Act and the Exchange Act, with respect to the disposition of all Shares covered by the Registration Statement during the applicable period in accordance with the intended methods of disposition by the Investor set forth in the Registration Statement as so amended or in such Prospectus as so supplemented.

 

4.2.3.   Notify the Investor as promptly as reasonably possible of any of the following events: (i) the Commission issues any stop order suspending the effectiveness of the Registration Statement or initiates any proceedings for that purpose; (ii) the Corporation receives notice of

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any suspension of the qualification or exemption from qualification of any Shares for sale in any jurisdiction, or the initiation or threat of any proceeding for such purpose; or (iii) the financial statements included or incorporated by reference in the Registration Statement become ineligible for inclusion or incorporation therein or any statement made in the Registration Statement or Prospectus or any document incorporated or deemed to be incorporated therein by reference is untrue in any material respect or any revision to the Registration Statement, Prospectus or other document is required so that it will not 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 the light of the circumstances under which they were made, not misleading.

 

4.2.4.   Use reasonable best efforts to avoid the issuance of or, if issued, obtain the withdrawal of (i) any order suspending the effectiveness of the Registration Statement, or (ii) any suspension of the qualification (or exemption from qualification) of any of the Shares for sale in any jurisdiction, as soon as practicable.

 

4.2.5.   Furnish to the Investor, without charge, at least one conformed copy of the Registration Statement and each amendment thereto, including financial statements and schedules, all documents incorporated or deemed to be incorporated therein by reference, and all exhibits to the extent requested by the Investor (including those previously furnished or incorporated by reference) promptly after the filing of such documents with the Commission.

 

4.2.6.   Promptly deliver to the Investor, without charge, as many copies of the Prospectus or Prospectuses (including each form of prospectus) and each amendment or supplement thereto as the Investor may reasonably request. The Corporation hereby consents to the use of such Prospectus and each amendment or supplement thereto by each of the selling Investor in connection with the offering and sale of the Shares covered by such Prospectus and any amendment or supplement thereto.

 

4.2.7.   (i) If required, prepare and timely file with any national securities exchange, market or trading or quotation facility on which the Common Stock is then listed or quoted (a “ Trading Market ”) an additional shares listing application covering all of the Shares; (ii) use reasonable best efforts to cause such Shares to be approved for listing on such Trading Market as soon as practicable thereafter; (iii) provide to the Investor evidence of such listing; and (iv) use reasonable best efforts to maintain the listing of such Shares on such Trading Market.

 

4.2.8.   Prior to any public offering of Shares, use reasonable best efforts to register or qualify or cooperate with the Investor in connection with the registration or qualification (or exemption from such registration or qualification) of such Share


 
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