EX-10.17 53 v035357_ex10-17.htm v035357_ex10-16 -- Converted by SECPublisher 2.1.1.8, created by BCL Technologies Inc., for SEC Filing

1.2 Issuance of Compliance Systems' Common Stock. Simultaneous with the execution of this Agreement and tender of the Subsidiary Stock, Compliance Systems will issue to the Subsidiary Shareholders Compliance Systems Common Stock in exchange for the capital contribution described in Section 1.1 above in the amounts set forth in Column "II" of Exhibit A.

1.3 Representations by Subsidiary Shareholders. In connection with the issuance of shares of Common Stock of Compliance Systems, each of the Subsidiary Stockholders hereby makes the following representations:

a)      Subsidiary Shareholder acknowledges that that the Common Stock is being acquired pursuant to an exemption under applicable securities laws and accordingly represents that he is acquiring such securities for his own account, for investment and not for distribution or resale to others.
 
  The Subsidiary Shareholder agrees that he will not sell, assign, hypothecate or otherwise transfer such securities unless they are registered under applicable securities laws or unless an exemption from such registration is available and acknowledges that the Company will permit the transfer of the Common Stock out of his name only when his request for transfer is accompanied by an opinion of counsel reasonably satisfactory to the Company that neither the sale nor the proposed transfer results or will result in a violation of applicable Federal and state securities laws.
 
b)      Subsidiary Shareholder acknowledges that the Company has filed an election as an "5" corporation under the Internal Revenue Code of 1986, as amended, and plans to file in such other jurisdictions where it does business, as permitted. Subsidiary Shareholder agrees not to transfer the Common Stock without the Company's prior written consent.
 
c)      Subsidiary Shareholder acknowledges that to the extent it is receiving shares of Class B Common Stock in connection herewith, a portion of such shares are subject to an option ("Option"). If Subsidiary Shareholder sells, assigns, hypothecates or otherwise transfers any Class B Common Stock, to the extent permitted, the transferee shall be required, as a condition precedent to agree to the terms of the Option.
 
d)      The Subscriber consents to the placement of a legend on any certificate or other document evidencing the Common Stock stating that such shares have not been registered under the Securities Act of 1933, as amended, and setting forth or referring to the restrictions on transferability and sale thereof set forth in subsections (a) and (b) above and sub section (c) above, in the case of shares of Class B Common Stock.
 
2

158293.5

MISCELLANEOUS

2.1 Other Documents. Each of the Subsidiary Shareholders shall execute and deliver such other and further documents and instruments, and take such other and further actions, as may be requested of them for the implementation and consummation of this Agreement and the transactions herein contemplated.

2.2 Parties in Interest. This Agreement shall be binding upon and inure to the benefit of the Subsidiary Shareholders, and the heirs, personal representatives, successors and assigns of all of them, but shall not confer, expressly or by implication, any rights or remedies upon any other party.

2.3 Governing Law. This Agreement is made and shall be governed in all respects, including validity, interpretation and effect, by the laws of the State of New York.

2.4 Entire Agreement. This Agreement and the Exhibits attached hereto contain the entire agreement by and among the Subsidiary Shareholders and Compliance Systems and supersede all prior agreements, understandings and writings between the parties hereto with respect to the subject matter hereof. Each Subsidiary Shareholder acknowledges that no representations, inducements, promises, or agreements, oral or otherwise, have been made by any party, which are not embodied herein or in the Exhibits attached hereto, and that no other agreement, statement or promise may be relied upon or shall be valid or binding. Neither this Agreement nor any term hereof may be changed, waived, discharged or terminated orally. This Agreement may be amended or any term hereof may be changed, waived, discharged, or terminated by an agreement in writing signed by the parties hereto.

2.5 Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original but all of which taken together shall constitute but one and the same document.

     iN WITNESS WHEREOF, the parties hereto have duly executed and delivered this Agreement as of the day and year first above written.

COMPLIANCE SYSTEMS CORPORATION
By:
_____________________
Dean Garfmkel
Chairman of the Board
and Secretary
3

158293.5

ARTICLE 2

SUBSIDIARY SHAREHOLDERS: Dean Garfinkel Alison Garfmkel Barry Brookstein Stefan Dunigan

     Louis Potters Alan ilberman Robert Reiner

Nettie Hanover Revocable Trust Judith Felsen Robert Greenspan Steven Wolfe

4

158293.5

ARTICLE 2

Lorraine Chinnici Jack Karp Henry Ponzio

Barry Brookstein, as custodian Robert Brookstein Judi LiVigni Dean Garfinkel, as custodian Alison Garfinkel, as custodian

158293.5

-S
4

Capital Contribution and Issuance of Shares

Name of Subsidiary Shareholder: Dean Garfinkel

L        iL 
Name of Company    Number of    Number of Shares of 
    Shares    Class A Common 
    Contributed    Stock 
        of Compliance Systems 
        Corporation 
 
Call    3,000,001    2,010,001 
Compliance.com,         
Inc.         
AMS Network Inc.    48     
Jasmin    48     
Communications, Inc.         

158293.5

EXHIBIT A

Lnke    Y SHAREHOLDERS: 
l    Alison Garfinkel 

Barry Brookstein
Stefan Dunigan
Louis Potters
Alan ilberman
Robert Reiner
Nettie Hanover Revocable Trust
Judith Felsen
Robert Greenspan
Steven Wolfe
4

158293.5

*

Capital Contribution and Issuance of Shares

Name of Subsidiary Shareholder: Alison Garfinkel

L        JL 
Name of Company    Number of    Number of Shares of 
    Shares    Class A Common 
    Contributed    Stock 
        of Compliance Systems 
        Corporation 
 
 
Call    3,000,001    2,010,001 
Compliance.com, Inc.         
AMS Network Inc.    48     
Jasmin    48     
Communications, Inc.         

1582935

EXHIBIT A
SUBSIDIARY SHAREHOLDERS:
Dean Garfinkel
Barry Brookstein
Stefan Dunigan
Louis Potters
Alan ilberman
Robert Reiner
Nettie Hanover Revocable Trust
Judith Felsen
Robert Greenspan
Steven Wolfe
4

1582935

EXHIBIT A

Capital Contribution and Issuance of Shares

Name of Subsidiary Shareholder: Barry Brookstein

i~        1L 
Name of Company    Number of    Number of Shares of 
    Shares    Class A Common 
    Contributed    Stock 
        of Compliance Systems 
        Corporation 
 
 
Call    1,875,001    1,256,251 
Compliance.com, Inc.         
AMS Network Inc.    30     
Jasmin    30     
Communications, Inc.         

158293.5

EXHIBIT A

Capital Contribution and Issuance of Shares

Name of Subsidiary Shareholder: Barry Brookstein

L        JL 
Name of Company    Number of    Number of Shares of 
    Shares    Class B Common 
    Contributed    Stock 
        of Compliance Systems 
        Corporation to be 
        Issued 
 
 
Call Compliance.com,    1,250,000    837,500 
Inc.         
AMS Network Inc.    20     
Jasmin    20     
Communications, Inc.         

158293.5

EXHIBIT A
Ji~ La42
airy rookstein
~efan Dunigan
DU1S Potters
lan ilberman

158293.5

EXHIBIT A
SUBSIDIARY SHAREHOLDERS:
Dean ~JLW Garfinkel
Alison Garfinkel
B rookstein
Stefan Dunigan
Louis Potters
Alan ilberman
Robert Reiner
Nettie Hanover Revocable Trust
Judith Felsen
Robert Greenspan
Steven Wolfe
4

obert Reiner

EXHIBIT A

Capital Contribution and Issuance of Shares

Name of Subsidiary Shareholder: Stefan Duniga~~

L        & 
Name of Company    Number of    Number of Shares of 
    Shares    Class A Common 
    Contributed    Stock 
        of Compliance Systems 
        Corporation 
 
 
Call    250,000    167,500 
Compliance.com, Inc.         
AMS Network Inc.    4     
Jasmin    4     
Communications, Inc.         

1582935

EXHIBiT A
SUBSIDIARY SHAREHOLDERS:
Dean Garfinkel
Alison Garfinkel
Barry Brookstein
Stefan tiunigan
Louis Potters
Alan ilberman
Robert Reiner
Nettie Hanover Revocable Trust
Judith Felsen
Robert Greenspan
Steven Wolfe
4

1582935

EXHIBiT A

Capital Contribution and Issuance of Shares

Name of Subsidiary Shareholder: Louis Potters

L        L 
Name of Company    Number of    Number of Shares of 
    Shares    Class B Common 
    Contributed    Stock 
        of Compliance Systems 
        Corporation 
 
 
Call    125,000    83,750 
Compliance.com, Inc.         
AMS Network Inc.    2     
Jasmin    2     
Communications, Inc.         

158293.5

EXHIBIT A
SUBSIDIARY SHAREHOLDERS:
Dean Garfinkel
Alison Garfinkel
Barry Brookstein
StefanDu
Louis Potters
o Alan ilberman
Robert Reiner
Nettie Hanover Revocable Trust
Judith Felsen
Robert Greenspan
Steven Wolfe
4

158293.5

EXHIBIT A

Capital Contribution and Issuance of Shares

Name of Subsidiary Shareholder: Alan Ilberman

J        JL 
Name of Company    Number of    Number of Shares of 
    Shares    Class B Common 
    Contributed    Stock 
        of Compliance Systems 
        Corporation to be 
        Issued 
 
Call Compliance.com,    187,500    125,625 
Inc.         
AMS Network Inc.    3     
Jasmin    3     
Communications, Inc.         

158293.5

EXHIBiT A
Dean Garfinkel
Alison Garfinkel
Barry Brookstein
Stefan Dunigan
Louis Potters
Alan ilberman
Robert Reiner
Nettie Hanover Revocable Trust
Judith Felsen
Robert Greenspan
Steven Wolfe
4

158293.5

SUBSIDIARY SHAREHOLDERS:
S.

Capital Contribution and Issuance of Shares

Name of Subsidiary Shareholder: Robert Reiner

L        JL 
Name of Company    Number of    Number of Shares of 
    Shares    Class B Common 
    Contributed    Stock 
        of Compliance Systems 
        Corporation to be 
        Issued 
 
Call Compliance.com,    250,000    167,500 
Inc.         
AMS Network Inc.    4     
Jasmin    4     
Communications, Inc.         

158293.5

EXIIIBILA
Dean Garfinkel
Alison Garfinkel
Barry
Brookstein
Stefan Dunigan
Louis Potters
Alan ilberman
M~ ~44t~
Robert Reiner
Nettie Hanover Revocable Trust
Judith Felsen
Robert Greenspan
Steven Wolfe
4

158293.5

SUBSIDIARY SHAREHOLDERS:
&    EXHIBIT 
    A 

Capital Contribution and Issuance of Shares

Name of Subsidiary Shareholder: Nettie Hanover Revocable Trust

L        & 
Name of Company    Number of    Number of Shares of 
    Shares    Class B Common 
    Contributed    Stock 
        of Compliance Systems 
        Corporation to be 
        Issued 
 
 
Call Compliance.com,    250,000    167,500 
Inc.         
AMS Network Inc.    4     
Jasmin    4     
Communications, Inc.         

158293.5

SUBSIDIARY SHAREHOLDERS:

SUBSIDIARY SHAREHOLDERS:

Dean Garfinkel
Alison Garfinkel
Barry Brookstein
Stefan Dunigan
Louis. Potters
Alan ilberman
Robert Reiner

NVettie Hanovef'Revocable Trust

Judith Felsen
Robert Greenspan
Steven Wolfe
4

158293.5

S.

Capital Contribution and Issuance of Shares

Name of Subsidiary Shareholder: Judith Felsen

L        JL 
Name of Company    Number of    Number of Shares of 
    Shares    Class B Common 
    Contributed    Stock 
        of Compliance Systems 
        Corporation to be 
        Issued 
 
 
Call Compliance.com,    375,000    251,250 
Inc.         
AMS Network Inc.    6     
Jasmin    6     
Communications, Inc.         

158293.5

EXBIBITA
SUBSIDIARY SHAREHOLDERS:
Dean Garfinkel
Alison Garfinkel
Barry Brookstein
Stefan Dunigan
Louis Potters
Alan ilberman
Robert Reiner
Nettie Hanover Revocable Trust
Qc~'
~(dith Felsen
Robert Greenspan
Steven Wolfe
4

158293.5

S.             
 
    Capital Contribution and Issuance of Shares    EXIUBITA 
 
 
 
    Name of Subsidiary Shareholder: Robert Greenspan     
 
 
L        JL     
Name of Company    Number of    Number of Shares of     
    Shares    Class B Common     
    Contributed    Stock     
        of Compliance Systems     
        Corporation to be     
        Issued     
 
 
Call Compliance.com,    187,500    125,625     
Inc.             
AMS Network Inc.    3         
Jasmin    3         
Communications, Inc.             

158293.5

S.
Steven
Wolfe

158293.5

S.

Capital Contribution and Issuance of Shares

Name of Subsidiary Shareholder: Steven Wolfe

~L        iL 
Name of Company    Number of     
        ' 
    Shares     
    Contributed    Number of Shares of 
        Class B Common 
        Stock 
        of Compliance Systems 
        Corporation to be 
        Issued 
 
Call    62,500    41,875 
Compliance.com, Inc.         
AMS Network Inc.    I     
Jasmin    I     
Communications, Inc.         

158293.5 SUBSIDIARY SHAREHOLDERS:Dean GarfinkelAlison GarfinkelBarry BrooksteinStefan DuniganLOuis PottersAlan IlbermanRobert ReinerNettie Hanover Revocable TrustJudith Felsen4

S    EXHIBIT A 
SUBSIDIARY SHAREHOLDERS:
    Dean Garfinkel 
    Alison Garfinkel 
    Barry Brookstein 
    Stefan Dunigan 
    Louis Potters 
    o Alan ilberman 
    Robert Reiner 
    Nettie Hanover Revocable Trust 
    Judith Felsén 
    RobertGeen an 
    Stehn Wolfe 

V

158293.5 SUBSIDIARY SHAREHOLDERS:Dean GarfinkelAlison GarfinkelBarry BrooksteinStefan DuniganLOuis PottersAlan IlbermanRobert ReinerNettie Hanover Revocable TrustJudith Felsen4

S
4

158293.5

S

Capital Contribution and Issuance of Shares

Name of Subsidiary Shareholder: Lorraine Chinnici

L         
Name of Company    Number of    Number of Shares of 
    Shares    Class B Common 
    Contributed    Stock 
        of Compliance Systems 
        Corporation to be 
        Issued 
 
 
Call    62,500    41,875 
Compliance.com, Inc.         
AMS Network Inc.    1     
Jasmin    I     
Communications, Inc.         

158293.5

EXHIBITA

158293.5

    EXHIBITA 
S    EXHIBIT 
    A 

Capital Contribution and Issuance of Shares

Name of Subsidiary Shareholder: Jack Karp

L        JL 
Name of Company    Number of    Number of Shares of 
    Shares    Class B Common 
    Contributed    Stock 
        of Compliance Systems 
        Corporation to be 
        Issued 
 
 
Call    62,500    41,875 
Compliance.com, Inc.         
AMS Network Inc.    1     
Jasmin    1     
Communications, Inc.         

158293.5 Jack KarpHenry Ponzioo Barry Brookstein, as custodianRobert BrooksteinJudi LiVigniDean Garfinkel,as custodianAlison Garfinkel, as custodian5

EXHIBITA
UI

158293.5 Jack KarpHenry Ponzioo Barry Brookstein, as custodianRobert BrooksteinJudi LiVigniDean Garfinkel,as custodianAlison Garfinkel, as custodian5

EXHIBITA

Capital Contribution and Issuance of Shares

Name of Subsidiary Shareholder: Henry Ponzio

L        JL 
Name of Com~anv    Number of    Number of Shares of 
    Shares    Class B Common 
    Contributed    Stock 
        of Compliance Systems 
        Corporation to be 
        Issued 
 
 
Call    125,000    83,750 
Compliance.com,         
Inc.         
AMS Network Inc.    2     
Jasmin    2     
Communications, Inc.         

1582935Lorraine Chinnici Henry PonzioBarry Brookstein, as custodianRobert BrooksteinJudi LiVigniDean Garfinkel, as custodianAlison Garfinkel, as custodian5

EXHIBITA
Jack
Karp
HenkPdo
Barry Brookstein, as
custodian
Robert
Brookstein
Judi
LiVigni
Dean Garfinkel, as
custodian
Ailson Garfinkel, as
custodian
5

1582935Lorraine Chinnici Henry PonzioBarry Brookstein, as custodianRobert BrooksteinJudi LiVigniDean Garfinkel, as custodianAlison Garfinkel, as custodian5

Lorraine Chinnici

Capital Contribution and Issuance of Shares

Name of Subsidiary Shareholder: Barry Brookstein as custodian

L        JL 
Name of Company    Number of    Number of Shares of 
    Shares    Class B Common 
    Contributed    Stock 
        of Compliance Systems 
        Corporation to be 
        Issued 
 
Call    15,625    10,468 
Compliance.com, Inc.         
AMS Network Inc.    ¼     
Jasmin    Y4     
Communications, Inc.         

158293.5

EXHIBIT A
Capital Contribution and Issuance of    EXHIBI 
Shares    T A 

Name of Subsidiary Shareholder: Barry Brookstein as custodian

L        & 
Name of Company    Number of    Number of Shares of 
    Shares    Class B Common 
    Contributed    Stock 
        of Compliance Systems 
        Corporation to be 
        Issued 
 
 
Call    15,625    10,468 
Compliance.com, Inc.         
AMS Network Inc.    14     
Jasrnin    ~'%     
Communications, Inc.         

158293.5

Pt
Capital Contribution and Issuance of Shares    EXHIBIT 
    A 
 
Name of Subsidiary Shareholder: Robert Brookstein     

    I    I 
        I 
    Number of     
    Shares    Number of Shares of 
Name of    Contribute    Class B Common 
Company    d    Stock 
        of Compliance Systems 
        Corporation to be 
        Issued 
 
Call    AMS Network Inc.    1/8 
Compliance.com,    7,813     
Inc.        5,235 
 
 
Jasmin    1/8     
Communications,         
Inc.         

158293.5

Pt
Jack Karp
Henry Ponzio
Barry Brookstein, as custodian
Robert Brookstein
Judi LiVigni
Dean Garfinkel, as custodian
Alison Garfinkel, as custodian
5

158293.5

Lorraine Chinnici

Capital Contribution and Issuance of Shares

Name of Subsidiary Shareholder: Judi LiVigni

L        & 
Name of Company    Number of    Number of Shares of 
    Shares    Class B Common 
    Contributed    Stock 
        of Compliance Systems 
        Corporation to be 
        Issued 
 
 
Call    7,812    5,234 
Compliance.com, Inc.         
AMS Network Inc.    1/8     
Jasmin    1/8     
Communications, Inc.         

158293.5

EXHIBIT A
Lorraine Chinnici
Jack Karp
Henry Ponzio
Barry Brookstein, as custodian
Robert Brookstein
Dean Garfinkel, as custodian
Alison Garfinkel, as custodian
5

158293.5

o1             
 
 
 
 
            Capital 
L        iL     
    Number of         
    Shares    Number of Shares of    Contribution and Issuance of 
Name of Company    Contributed    Class B Common     
        Stock     
        of Compliance Systems    Shares Name of Subsidiary 
        Corporation to be     
        Issued     
            Shareholder: Dean and 
 
Call    31,250         
Compliance.com,            Alison Garfinkel as 
Inc.        20,938     
 
AMS Network Inc.    V2         
        custodians 
Jasmin
Communications,             

1582935

EXHIBIT A

Inc.