Securities Purchase Agreement
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Title: |
Securities Purchase Agreement |
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Entities: |
Numerex Corp. |
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Date: |
2007 |
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Size: |
Preview shows 14KB of 78KB total |
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Price: |
$44 |
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ID: |
#2687902 |
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Start of
Preview |
SECURITIES PURCHASE AGREEMENT
This Securities Purchase Agreement (this Agreement) is made and entered into as of December 29, 2006, by and between NUMEREX CORP., a Pennsylvania corporation (the Company), and LAURUS MASTER FUND, LTD., a Cayman Islands company (the Purchaser).
Recitals
Whereas, the Company has authorized the sale to the Purchaser of a Secured Convertible Term Note in the aggregate principal amount of Ten Million Dollars ($10,000,000) (as amended, restated, modified or supplemented from time to time, the Note), which Note is convertible into shares of the Companys Class A common stock, no par value per share (the Common Stock) at a fixed conversion price of $10.37 per share of Common Stock (Fixed Conversion Price);
Whereas, the Company wishes to issue a warrant to the Purchaser to purchase up to 158,562 shares (subject to adjustment in accordance with the terms thereof) of the Companys Common Stock in connection with Purchasers purchase of the Note (as amended, restated, modified or supplemented from time to time, the Warrant);
Whereas, Purchaser desires to purchase the Note and Warrant on the terms and conditions set forth herein; and
Whereas, the Company desires to issue and sell the Note and Warrant to Purchaser on the terms and conditions set forth herein.
Agreement
Now, Therefore, in consideration of the foregoing recitals and the mutual promises, representations, warranties and covenants hereinafter set forth and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
1. Agreement to Sell and Purchase. Pursuant and subject to the terms and conditions set forth in this Agreement, on the Closing Date (as defined in Section 3), the Company agrees to sell to the Purchaser, and the Purchaser hereby agrees to purchase from the Company the Note in accordance with the terms of the Note and this Agreement. The Note and the Warrant purchased on the Closing Date shall be known as the Offering. A form of the Note is annexed hereto as Exhibit A. The Note will have a Maturity Date (as defined in the Note) forty eight (48) months from the date of issuance, subject to acceleration in accordance with the terms thereof. Collectively, the Note, the Warrant and Common Stock issuable in payment of the Note, upon conversion of the Note and upon exercise of the Warrant, are referred to as the Securities.
2. Fees and Warrant. On the Closing Date:
(a) The Company will issue and deliver to the Purchaser the Warrant. pursuant to Section 1 hereof. The Warrant must be delivered on the Closing Date. A form of Warrant is annexed hereto as Exhibit B. All the representations, covenants, warranties, undertakings, and indemnification, and other rights made or granted to or for the benefit of the Purchaser by the Company are hereby also made and granted in respect of the Warrant and shares of the Companys Common Stock issuable upon exercise of the Warrant (the Warrant Shares).
(b) Upon execution and delivery of this Agreement by the Company and Purchaser, the Company shall pay to Laurus Capital Management, LLC (LCM), manager of Purchaser, a non-refundable payment in an amount equal to four percent (4%) of the aggregate principal amount of the Note. The foregoing payment is referred to herein as the LCM Payment. Such payment shall be deemed fully earned on the Closing Date and shall not be subject to rebate or proration for any reason.
(c) On the Closing Date, the Company shall reimburse the Purchaser in the amount of $35,000.00 for the following expenses: (i) expenses (including reasonable legal fees and expenses) incurred by the Purchaser in connection with the entering into of this Agreement and the Related Agreements, (ii) expenses incurred in connection with the Purchasers due diligence review of the Company and its Subsidiaries (as defined below) and all related matters and (iii) expenses incurred in connection with any required third-party appraisals and/or extraordinary diligence.
(d) The LCM Payment and the expenses referred to in the immediately preceding clause (c) (net of deposits previously paid by the Company) shall be paid at Closing out of funds held pursuant to a Funds Escrow Agreement of even date herewith among the Company, Purchaser, and the escrow agent named therein (the Funds Escrow Agreement) and a disbursement letter (the Disbursement Letter).
3. Closing, Delivery and Payment.
3.1 Closing. Subject to the terms and conditions herein, the closing of the transactions contemplated hereby (the Closing), shall take place on the date hereof, at such time, place or manner as the Company and Purchaser may mutually agree (such date is hereinafter referred to as the Closing Date).
3.2 Delivery. Pursuant to the Funds Escrow Agreement in the form attached hereto as Exhibit D, at the Closing on the Closing Date, the Company will deliver to the Purchaser, among other things, the Note and the Warrant and the Purchaser will deliver to the Company, among other things, the amounts set forth in the Funds Escrow Agreement by wire transfer of immediately available funds. The Company hereby acknowledges and agrees that Purchasers obligation to purchase the Note from the Company, and to authorize the release of the proceeds of the Note, on the Closing Date shall be contingent upon the satisfaction (or waiver by the Purchaser in its sole discretion) of the items and matters set forth in the closing checklist provided by the Purchaser to the Company on or prior to the Closing Date.
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4. Representations and Warranties of the Company.
The Company hereby represents and warrants to the Purchaser as of the date of this Agreement as set forth below which disclosures are supplemented by, and subject to the Companys filings under the Securities Exchange Act of 1934 and any exhibits thereto (including without limitation any information furnished under cover of Form 8-K) (collectively, the Exchange Act Filings). All references herein to the Companys knowledge shall refer to the actual knowledge of any officer of the Company.
4.1 Organization, Good Standing and Qualification. The Company is a corporation duly organized, validly existing and in good standing under the laws of the Commonwealth of Pennsylvania. Each of the Company and its Subsidiaries, as applicable, has the corporate or limited liability company power and authority to own and operate its properties and assets, to execute and deliver (i) this Agreement, (ii) the Note and the Warrant to be issued in connection with this Agreement, (iii) the Master Security Agreement relating to the Note, dated as of the date hereof, by and among the Company, certain Subsidiaries of the Company and the Purchaser (as amended, restated, modified or supplemented from time to time, the Master Security Agreement), (iv) the Registration Rights Agreement relating to the Securities, dated as of the date hereof, between the Company and the Purchaser (the Registration Rights Agreement), (v) the Subsidiary Guaranty made by certain Subsidiaries of the Company, dated as of the date hereof (as amended, modified or supplemented from time to time, the Subsidiary Guaranty), (vi) the Pledge Agreement, dated as of the date hereof, by and among the Company, certain Subsidiaries of the Company and the Purchaser (as amended, modified or supplemented from time to time, the Stock Pledge Agreement), (vii) the Escrow Agreement, and (viii) all other agreements expressly referred to herein and expressly related to this Agreement (as each of the foregoing clauses (ii) through (viii), inclusive, may be amended, restated, modified and/or supplemented from time to time, collectively, the Related Agreements), to issue and sell the Note and the shares of Common Stock issuable upon conversion of the Note (the Note Shares), to issue and sell the Warrant and the Warrant Shares, and to carry out the provisions of this Agreement and the Related Agreements and to carry on its business as presently conducted. The Company is duly qualified and is authorized to do business and is in good standing as a foreign corporation in all jurisdictions in which the nature of its activities and of its properties (both owned and leased) makes such qualification necessary, except for those jurisdictions in which failure to do so would be reasonably expected not to have a material adverse effect on the Company, its Subsidiaries or their assets, condition (financial or otherwise), business or results of operations, taken as a whole (a Material Adverse Effect).
4.2 Subsidiaries. The Company owns all of the issued and outstanding capital stock or other equity interests of the business entities listed on Schedule 4.2 (the Subsidiaries). Except as otherwise disclosed on the attached Schedule 4.2, the Company does not directly or indirectly own or control any equity security or other interest of any other corporation, limited partnership or other business entity. In addition, if and to the extent the Company or a Subsidiary acquires any stock or other equity interest in a corporation or other entity after the date of this Agreement, the term Subsidiary shall mean and also include such corporation or other entity if (i) such shares of stock or other ownership interests having ordinary voting power (other than stock or other ownership interests having such power only by reason of
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the happening of a contingency) of such corporation or other entity that are acquired by the Company or a Subsidiary have the power to elect a majority of the directors of such corporation, or other persons or entities performing similar functions for such person or entity, are owned, directly or indirectly, by such person or entity or (ii) as a result of such acquisition, the Company or a Subsidiary owns, directly or indirectly, more than fifty percent (50%) of the shares or equity interests in such corporation or other entity at such time.
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