MEKONG ANGEL INVESTOR NETWORK MEMBERSHIP AGREEMENT
Dated as of October 1st, 2016
As of the date indicated on the signature pages hereto or by accepting terms and conditions through the online portal on ProSeeder, each Person (as defined below) who signs this Mekong Angel Investor Network Membership Agreement, as amended from time to time (this “Agreement”), the current and effective version of which shall be available in the Membership Section of the MAIN website, is hereby admitted to the Mekong Angel Investor Network (the “Network” or “MAIN”) as a member (each, a “Member” and together with all other Persons who have executed this Agreement prior to such date and all other Persons who may execute this Agreement in the future, the “Members”) and hereby accepts and agrees to the terms of this Agreement and the additional terms of Network membership as may be outlined in the Member Handbook. All capitalized terms used herein are defined in Section 4.
Section 1 – Membership
1.1 Mission Statement; Values Statement: Each Member must support and abide by the Network’s mission statement and values statement, each of which may be published and updated from time to time.
1.2 Name and Contact Information: Each Member shall provide his/her/its name, address, phone numbers, e- mail address and sponsor, if applicable, on the profile page of the MAIN online system, currently ProSeeder. Each Member shall promptly advise MAIN of any changes to this information and separately update the system. MAIN shall retain a complete list of all Members in its corporate records.
1.3 Classification: There shall be 4 classes classes of membership in the Network: (i) Individual Members; (ii) Family (or equivalent) Members; (iii) Corporate Members and (iv) Junior Members. Unless otherwise noted, the terms and conditions herein shall apply to each class of Members.
1.4 Term and Fees: Members will be admitted to the Network on a rolling basis with each term beginning on the date on which each such Member is admitted and ending on the first day of the next month 11 months after anniversary of such admittance (each, a “Term”). Each Term will automatically renew for additional one-year Terms, unless otherwise terminated pursuant to the terms hereof. Each Member shall, if they wish to remain a member, pay a fee, which corresponds to such Member’s membership class, for each Term (the “Annual Fee”), as determined by MAIN at the beginning of each Term. Each Member shall also pay a one-time fee upon or prior to the commencement of such Member’s initial Term (the “Initiation Fee” and, together with the Annual Fee, the “Fees” and each a “Fee”). The Fees are subject to change from year to year without prior notice to Members. The Initiation Fee and the Annual Fee for the initial Term for each Member shall be specified on such Member’s signature page hereto. The Network will invoice Members for the Fee(s) due for each renewal Term, payable upon receipt of the invoice. Late fees will apply. The Network will not reimburse or prorate Fees in the event that a Member ceases to be a Member for any reason during a Term.
1.5 Legal Entities: In certain situations it may be required or desirable for MAIN to create a special purpose limited liability company (an “Investment LLC”) in order to make an investment in a particular Portfolio Company. In these situations, each Member is required to make his/her/its investment in such Portfolio Company via the designated Investment LLC, except as otherwise approved by MAIN based upon investment size. Fees, other compensation and expenses for the Investment LLCs shall be published prior to any investment and outlined in any investment documents. IN the event there is an obligation, such obligation to pay fees and expenses, pro rata, arising from each Investment LLC continues until the termination of each such Investment LLC, whether or not the Member remains a Member of the Network.
1.6 Termination of Participation: Participation in the Network may be terminated at any time by and at the discretion of the managers of MAIN, including, without limitation, if: (a) a Member fails to pay membership Fees following notice to remit due and payable Fees; (b) a Member consistently or materially fails to make the required investments; (c) a Member breaches any of the representations, warranties, or covenants contained in this Agreement. In addition, each Member may terminate his/her/its participation in the Network at any time upon notice to MAIN.
1.7 Material Updates: Each Member will receive electronic notification of any material update to this Agreement; however, whether or not any material update is made and regardless of the frequency thereof, if any, each Member agrees to periodically review the current and effective version of this Agreement available in the Membership Section of the MAIN website.
Section 2 - Representations & Warranties
Each of the Members severally represents, warrants, and covenants to MAIN and the Network as follows:
2.1 Investment: Such Member will be evaluating Prospective Portfolio Companies and making investments in one or more Portfolio Companies for his/her/its own account, for investment purposes only and not with a view to, or for sale in connection with, any distribution thereof, nor with any present intention of distributing or selling the same; and, except as contemplated by this Agreement, such Member has no present or contemplated agreement, undertaking, arrangement, obligation, indebtedness, or commitment providing for the disposition thereof.
2.2 Accredited Investor: If subject to United States Securities and Exchange Commission (SEC) jurisdiction, such Member is an “accredited investor” as defined in Rule 501(a) under Regulation D of the Securities Act (a summary of which is attached hereto as Schedule B) and such Member has accurately and truthfully indicated the basis for his/her/its status as an “accredited investor” on Schedule B. Moreover, such Member shall immediately notify MAIN upon any change in his/her/its status from that indicated by such Member on Schedule B and, to the extent that such Member no longer meets the requirements for qualification as an “accredited investor” or is no longer able to certify its status as such, such Member’s participation in the Network shall terminate, effective as of the date of such change.
2.3 Authority: Such Member has full power and authority to enter into and to perform this Agreement in accordance with its terms. Upon its execution and delivery, this Agreement will be a valid and binding obligation of such Member, enforceable in accordance with its terms, except (a) as limited by applicable bankruptcy, insolvency, reorganization, moratorium or other laws of general application affecting enforcement of creditors’ rights and (b) as limited by general principles of equity that restrict the availability of equitable remedies.
2.4 Experience: Such Member has carefully reviewed the representations concerning the Network contained in this Agreement and has made a detailed inquiry concerning MAIN, the Network, its business and its personnel; the management of MAIN has made available to such Member any and all written information which he, she, or it has reasonably requested and has answered to such Member’s satisfaction all inquiries made by such Member; and such Member has sufficient knowledge and experience in finance and business that he/she/it is capable of evaluating the risks and merits of membership in the Network and such Member is able financially to bear the risks thereof.
2.5 Access to information confidentiality: Such Member acknowledges that, as a consequence of membership in the Network and the business activities of the Network and of MAIN, certain trade secrets and other information of a proprietary or confidential nature relating to the Network, Prospective Portfolio Companies, and Portfolio Companies (all such information falling within the definition of “Confidential Information,” as defined in the MAIN Non-Disclosure and Confidentiality Agreement attached hereto
as Schedule C) has been and will be disclosed to such Member. Such Member has read the MAIN Non- Disclosure and Confidentiality Agreement, attached hereto as Schedule C, in its entirety and understands that such agreement is hereby incorporated herein and that, in executing this Agreement, such Member is bound by the terms of the MAIN Non-Disclosure and Confidentiality Agreement.
2.6 Conflict of interest prior relationships: Such Member, when reviewing information presented (either verbally or in writing) to the Network, or available on the MAIN website or through other electronic systems or means, or presented or provided by Prospective Portfolio Companies and Portfolio Companies, including, without limitation, all Confidential Information, shall use his/her/its reasonable judgment and shall recuse him/herself/itself (i) if, in such Member’s reasonable judgment, an actual or potential conflict of interest could arise or (ii) as requested by MAIN. Further, such Member shall notify the management of MAIN, in writing and/or promptly after it is discovered that there exists a prior relationship between such Member and any Prospective Portfolio Company. The notice shall contain the current and past nature of the relationship and any other information that would be relevant to the particular situation.
2.7 Non-solicitation: Such Member shall not solicit business from any other member, any Prospective Portfolio Company, or any Portfolio Company, and such Member shall not distribute promotional materials at membership meetings, in each case without the prior approval of the management of MAIN. Neither the Members, nor the membership list, nor the Prospective Portfolio Companies and Portfolio Companies, nor the database thereof, nor any Confidential Information, shall be exploited by such Member for soliciting business.
2.8 Non-disparagement: Members are expected to represent the Network, MAIN and its Affiliates, and all Portfolio Companies in a positive manner. Such Member shall not defame or disparage the Network or its Members, any Portfolio Company or Prospective Portfolio Company, or MAIN or its business or its strategic plans, products, practices, policies, or personnel, in any medium or to any person or entity.
2.9 Disclaimer: Such Member warrants that in making an investment decision, such Member will rely solely on his/her/its own examination of the Person creating the securities and the terms of the offering, including the merits and risks involved. Any investment made by such Member in a Portfolio Company will be made without regard to any statement made by MAIN, any employee, or another Member of the Network. In the event that due diligence information completed by the MAIN staff or Members of the Network is shared amongst Members, such Member shall not rely upon that due diligence to make his/her/its own investment decision, but rather shall make all investment decisions independently. In the event that due diligence information completed by another angel group is shared with MAIN and Members, such Member shall not rely upon that due diligence to make his/her/its own investment decision, but rather shall make all investment decisions independently. Such Member represents that he/she/it has the financial capacity to make investments in companies as provided by this Agreement, including, without limitation, the capacity to lose such Member’s entire investment. Such Member hereby acknowledges that such Member will be required to bear the economic risk of his/her/its investments in Portfolio Companies and, as applicable, in any MAIN Fund, for an indefinite period of time, and such investments may not be transferable. Such Member understands that MAIN does not guarantee any economic result from any investment by such Member or from such Member’s participation in the Network.
Section 3 – Miscellaneous
3.1 Legal Services: It is expected that the MAIN Lead Investor and/or Deal Director will draft, present and negotiate a term sheet with each Prospective Portfolio Company, and that the final investment documents will be drafted by lawyers selected and/or approved by MAIN. Each Prospective Portfolio Company will be expected to pay any and all legal fees associated with any investment by any Portfolio Company Investor in such Prospective Portfolio Company, whether or not such Prospective Portfolio Company becomes a Portfolio
Company, but in the event that the legal fees associated with any such investment (or any portion thereof) are not paid by such Prospective Portfolio Company, each Portfolio Company Investor shall pay, within ten (10) Business Days of a request by MAIN, his/her/its share of such fees, pro rata based on such person’s Investment Amount as a fraction of the total Investment Amounts of all Portfolio Company Investors in the aggregate. Whereas, Members of the Network may co-invest in a Portfolio Company in a syndicate, which may include MAIN, Affiliates of MAIN, and MAIN Funds, and whereas MAIN makes available to its Members and all members of the syndicate the draft form of legal documents that are to be signed upon the closing of a Prospective Portfolio Company, and whereas MAIN appoints a Deal Director and/or a Lead Investor to negotiate final terms on behalf of the syndicate:
Members agree that they will accept final terms as negotiated on behalf of the syndicate, so long as such terms do not differ materially from the draft documents and members of the syndicate are advised of any non- material changes before or at the closing.
3.2 Amendments; Termination: This Agreement may be modified or terminated by MAIN at any time, with notice as soon as is practicable. It shall be incumbent upon each Member to periodically review the current and effective version of this Agreement, as is available in the membership section of the MAIN website. To the extent that any material modification is made to this Agreement, Members shall receive electronic notification thereof and if any Member is not willing or able to adopt such changes, then such Member may terminate his or her membership, with written notice to MAIN within ten (10) Business Days of such electronic notification, which termination will be deemed to have taken effect immediately prior to such changes. Upon termination of this Agreement, Members will not be entitled to receive all or any portion of the Fees paid by such Members for any given year.
Section 4 – Definitions
Unless the context otherwise requires, the following terms shall have the following meanings for purposes of this Agreement:
“Affiliate” when used with reference to a Person means any Person (other than MAIN, LLC), directly or indirectly, through one or more intermediaries, controlling, controlled by, or under common control with, such Person. In addition, Affiliates of a Member shall include all partners, officers, employees and former partners, officers, or employees of, all consultants or advisors to, and all other Persons who directly or indirectly receive compensation from, such Member.