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EXHIBIT 6.42
OFFSHORE SECURITIES SUBSCRIPTION AGREEMENT
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OFFSHORE SECURITIES SUBSCRIPTION AGREEMENT
THIS OFFSHORE SECURITIES SUBSCRIPTION AGREEMENT is executed in reliance upon
the transaction exemption afforded by Regulation S ("Regulation S") as
promulgated by the Securities and Exchange Commission ("SEC"), under the
Securities Act of 1933, as amended ("1933 Act").
THIS AGREEMENT has been executed by the undersigned in connection with the
private placement of shares of Common Stock (hereinafter referred to as the
"Shares") of KCD HOLDINGS INCORPORATED (hereinafter referred to as "KCD")
located at 0000 Xxxxxxxxx Xxxx, Xxxxx 000, Xxxxxxxx Xxxxxxx, Xxxxxxxxxx 00000,
Xxxxxx Xxxxxx of America; a corporation organized under the laws of Nevada,
United States of America (hereinafter referred to as "Seller" or "Company"). The
undersigned, _____________________________________, a corporation organized
under the laws of _______________________________________ jurisdiction
(hereinafter referred to as "Purchaser"), hereby represents and warrants to, and
agrees with Seller as follows:
1. AGREEMENT TO SUBSCRIBE; PURCHASE PRICE.
a. The undersigned hereby subscribes for _____________ Shares of the Common
Stock of KCD for an aggregate amount of $_____________(US).
b. Form of Payment. Purchaser shall pay the purchase price by delivering
immediately available funds in United States Dollars to Levy & Levy, P.A., Attn:
Xxxxxxx X. Xxxx, Esq., Xxxxx 0000, Xxxxx 000, Xxxxxxxx, Xxx Xxxxxx 00000 as
Escrow Agent, by delivery of securities versus payment.
2. ACCEPTANCE OF SUBSCRIPTION.
a. This subscription may be accepted or rejected by the Company at its sole
discretion.
b. This subscription shall be deemed accepted only when this Agreement is
signed by the Company in the space provided on the signature page hereof.
c. If the Company receives subscriptions from multiple subscribers, it has
no obligation to accept subscriptions in the order received.
3. PURCHASER REPRESENTATIONS AND WARRANTIES.
a. Offshore Transaction. Purchaser hereby represents and warrants to Seller
as of the date hereof and as of the Closing Date as follows:
(i) If the Purchaser is a corporation, it is duly organized,
validly existing and in good standing under the laws of the
jurisdiction of its incorporation, and if the Purchaser is a
partnership or other organization, it is duly organized,
validly existing and in good standing under the laws of its
jurisdiction of organization.
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(ii) (a) If the Purchaser is a corporation, the execution, delivery
and performance of this Agreement have been duly authorized by
all necessary corporate action, (b) if the Purchaser is a
partnership or other organization, the other governing
documents to enter into this Agreement and to consummate the
transactions contemplated hereby and all necessary consents
and approvals required by the partnership agreement or other
governing documents have been obtained, and (c) this Agreement
constitutes a legal, valid and binding obligation of the
Purchaser, enforceable against the Purchaser in accordance
with its terms, except to the extent that enforceability may
be limited by applicable bankruptcy, insolvency,
reorganization, moratorium and similar laws affecting
creditors' rights generally.
(iii) The Purchaser did not receive any offer to purchase the Shares
in the United States. This Agreement has not been executed by
the Purchaser in the United States.
(iv) The Purchaser is not a "U.S. person," as defined by Rule
902(o) of Regulation S (a "U.S. Person"), promulgated under
the Securities Act of 1933, as amended (the "1933 Act") and as
set forth in Schedule A attached hereto, and is not acquiring
the Shares, directly or indirectly, for the account or benefit
of any U.S. Person.
(v) The Purchaser (a) has received a copy of the Disclosure
Documents (as hereinafter defined) and has carefully reviewed
and understands the Disclosure Documents and this Agreement
and (b) understands that, except as set forth in the
Disclosure Documents and in this Agreement, no representations
or warranties have been made to the Purchaser by the Company
or by any distributor, or by any of their officers, directors,
employees, agents or affiliates, and (c) agrees that, in
connection with the purchase of the Shares, it is not relying
upon any information concerning the Company, other than (i)
that contained in the Disclosure Documents and in this
Agreement and (ii) on the results of its own independent
investigations. The term "Disclosure Documents" shall mean (a)
the Company's latest Annual Report to Shareholders on Form
10-K (without exhibits), (b) the Company's Quarterly Reports
on Form 10-Q and Form 8-K thereafter, and (c) copies of the
Company's significant press releases issued after said Annual
Report.
(vi) The Purchaser understands that (a) no governmental authority
has passed upon the accuracy or completeness of the Disclosure
Documents or has made any finding or determination concerning
the appropriateness or suitability of an investment in the
Shares and (b) no governmental authority has recommended or
endorsed, or will recommend or endorse, the investment in the
Shares.
(vii) The Purchaser is not purchasing the Shares with a view to the
distribution thereof within the meaning of the 1933 Act.
(viii) The Purchaser will not engage in any transaction or series of
transactions that, although in technical compliance with
Regulation S, is part of a plan or scheme to evade the
registration requirements of the 1933 Act with respect to the
Shares.
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(ix) All subsequent offers and sales of the Shares by Purchaser
shall be made in compliance with Regulation S under the
Securities Act, pursuant to registration under the
Securities Act or pursuant to an exemption from such
registration. In any case, the Shares shall not be resold
to U.S. persons or within the United States during the
period of forty (40) days commencing on the date of
Closing of the purchase of the Shares;
(x) Purchaser understands that the Shares are being offered
and sold to it in reliance on specific exemptions from the
registration requirements of Federal and State securities
laws and that the Seller is relying upon the truth and
accuracy of the representations, warranties, agreements
acknowledgments and understandings of Purchaser set forth
herein in order to determine the applicability of such
exemptions and the suitability of Purchaser to acquire the
Shares.
(xi) Purchaser agrees to indemnify and hold the Company, the
Distributor, their respective officers, directors and
shareholders or any other person who may be deemed to
control the Company or the Distributor harmless from any
loss, liability, claim, damage or expense, arising out of
the inaccuracy of any of Purchaser's representations,
warranties or statements or the breach of any of the
agreements contained herein.
4. LIMITATIONS ON TRANSFER AND CERTAIN COVENANTS.
a. The Purchaser acknowledges that (i) the Shares have not been registered
under the 1933 Act in reliance on provisions of Rule 903 or Rule 904 of
Regulation S, nor have the Shares been registered or qualified for sale under
the laws of any other jurisdiction (either within or outside of the United
States) and (ii) the Company has no obligations hereunder or any current
intention to effect any such registration or qualification.
b. The Purchaser covenants and agrees that it will not sell the Shares to a
U.S. Person, or for the account or benefit of a U.S. Person, prior to the
expiration of a period of 40 days following the Closing Date ("Restricted
Period").
c. The Purchaser acknowledges that the certificates evidencing the Shares
will bear the following legend:
"These shares have been issued pursuant to Regulation S as an exemption
to the registration provisions under the Securities Act of 1933, as
amended. These shares cannot be transferred, offered or sold in the
U.S. or to U.S. persons (as defined in Regulation S) until after
__________, 1996 (Forty-one days after issuance)."
The Company covenants and agrees that following the expiration of the
Restricted Period it will advise the transfer agent for the Common Stock, upon
the request of a recordholder of the Shares, that the foregoing legend can be
removed from the certificate for the Shares.
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d. The Purchaser represents and warrants to the Company that, as of the date
hereof and as of the Closing Date, neither it nor any of its affiliates has, and
covenants that during the Restricted Period neither it nor any of its affiliates
will establish or maintain, any short position (including any short call
position or any long put position) with respect to the Common Stock of the
Company, and that no such person or entity is a party to, nor shall it enter
into during the Restricted Period, any contract or arrangement having the effect
of eliminating or substantially diminishing the risk of ownership of the Shares.
5. REPRESENTATIONS AND WARRANTIES OF THE SELLER.
The Seller represents and warrants to the Purchaser, as of the date hereof
and as of the Closing Date, that:
a. The Company is a corporation duly organized, validly existing and in
good standing under the laws of the jurisdiction of its incorporation.
b. The execution, delivery and performance of this Agreement has been duly
authorized by all necessary corporate action and this Agreement constitutes
a valid and binding obligation of the Company, enforceable against the
Company in accordance with its terms, except to the extent that
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium and similar laws affecting creditor's rights
generally.
c. The execution, delivery and performance of this Agreemnt does and will
not (i) violate any provision of the Company's Certificate of Incorporation
or By-laws, (ii) violate or breach any material contract or agreement to
which the Company is a party, (iii) result in the creation of any lien,
security interest, charge or encumbrance on any property or assets of the
Company, or (iv) require the authorization, consent or approval of any court
or any administrative or governmental body pursuant to any law, statute,
rule or regulation to which the Company is subject to any order, judgment or
decree by which the Company is bound.
d. When issued in accordance with the terms of this Agreement, the Shares:
(i) except for the Regulation S legend provided in this Agreement, will
be free and clear of any restrictions, liens, claims or other
encumbrances by the Company (other than those that may arise by reason
of any action or inaction of the Purchaser);
(ii) will be duly authorized, validly issued, fully paid and
nonassessable;
(iii) will not have been issued or sold in violation of any preemptive
or other similar rights of the holders of any securities of the Company;
and
(iv) will not subject the holders thereof to personal liability to the
Company solely by reason of their ownership of such Shares.
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e. The Company is a "Reporting Issuer" as defined by Rule 902(l) of
Regulation S. The Company is in full compliance, to the extent applicable,
with all reporting obligations under either Section 12(b), 12(g) or 15(d) of
the Securities Exchange Act of 1934, as amended (the "Exchange Act"). The
Common Stock is quoted on the OTC Electronic Bulletin Board and its trading
symbol is "KCDH".
f. Seller has not offered the securities which are the subject of this
transaction to any person in the United States, any identifiable groups of
U.S. citizens abroad, or to any U.S. person as that term is defined in
Regulation S.
g. At the time the buy order was originated, Seller and/or its agents
reasonably believed Purchaser was outside of the United States and was not a
U.S. person.
h. Seller and/or its agents reasonably believe that the transaction has not
been prearranged with a buyer in the United States.
i. In regard to this transaction, Seller has not conducted any "directed
selling efforts" as that term is defined in Rule 902 of Regulation S nor has
Seller conducted any general solicitation relating to the offer and sale of
the securities which are the subject of this transaction to persons resident
within the United States or elsewhere.
Each of the foregoing representations and warranties shall survive the
Closing.
6. REMEDIES.
In the event of a breach by the Purchaser of any of the representations,
warranties or covenants contained in this Agreement, and without limitation of
any other remedy available to the Company at law or in equity, the Company shall
have the right and the option to rescind the sale of the Shares to the
Purchaser. In such case, the amount payable to the Purchaser upon rescission
will be the aggregate Purchase Price, less all expenses, costs and damages
incurred by the Company, and whereupon the Company shall have no further
liability or obligation to the Purchaser under this Agreement or otherwise.
7. ASSIGNABILITY.
Neither this Agreement, nor the rights or obligations of either party
hereunder, may be transferred or assigned without the prior written consent of
the other party (which may be withheld for any reason in the sole discretion of
the party required to provide such consent) and any purported transfer or
assignment not so consented to shall be void. This Agreement shall be binding on
and inure to the benefit of the parties hereto and their respective successors
and permitted assigns.
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8. ENTIRE AGREEMENT.
This Agreement constitutes the entire agreement between the parties hereto
with respect to the subject matter hereof, and there are no representations,
warranties, covenants or other agreements of either party except as stated
herein.
9. AMENDMENTS.
No provision of this Agreement shall be waived, discharged or amended,
except by an instrument in writing signed by the party against whom any such
waiver, modification, discharge or amendment is sought.
10. WAIVERS.
No waiver by either party of any default with respect to any provision,
condition or requirements of this Agreement shall be deemed to be a waiver of
any future default with respect to the same provision, condition or requirement,
or a waiver of any other provision, condition or requirement hereof. No delay or
omission of either party to exercise any right hereunder shall in any manner
impair the exercise of such right at any future time.
11. APPLICABLE LAW.
This Agreement shall be construed in accordance with and governed by the
laws of the State of California without regard to the conflicts of laws
principles thereof.
12. SEVERABILITY.
Each provision of this Agreement shall be considered severable and if for
any reason any provision which is not essential to the effectuation of the basic
purposes of this Agreement is determined by a court of competent jurisdiction to
be invalid or unenforceable, or contrary to existing or future applicable law,
such invalidity shall not impair the operation of or affect those provisions of
this Agreement which are valid. In such case, this Agreement shall be construed
so as to limit any term or provision so as to make it enforceable or valid
within the requirements of any applicable law, and in the event such term or
provision cannot be so limited, this Agreement shall be construed to omit such
invalid or unenforceable provision.
13. FAX SIGNATURES AND COUNTERPARTS.
This Agreement may be executed in any number of counterparts, including
counterparts transmitted by telecopier or FAX, any one of which shall constitute
an original of this Agreement. When counterparts of facsimile copies have been
executed by all parties, they shall have the same effect as if the signature to
each counterpart or copy were upon the same document and copies of such
documents shall be deemed valid as originals. The parties agree that all such
signatures may be transferred to a single document upon the request of any
party.
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14. NOTICES.
Any notice or other communication required or permitted to be given
hereunder shall be in writing and shall be effective (a) upon hand delivery by
telecopy or facsimile at the address or number designated below (if delivery on
a business day during normal business hours where such notice is to be
received), or the first business day following such delivery (if delivered other
than on a business day during normal business hours where such notice is to be
received) or (b) on the second business day following the date of mailing by
express courier service, fully prepaid, addressed to such address, or upon
actual receipt of such mailing, whichever shall first occur. The addresses for
such communications shall be:
If to the Company: KCD Holdings Incorporated
0000 Xxxxxxxxx Xxxx, Xxxxx 000
Xxxxxxxx Xxxxxxx, XX 00000
Xxxxxx Xxxxxx of America
If to the Purchaser, as set forth on the signature page hereof.
Either party hereto may from time to time change its address for notices
under this Section 14 by giving at least 10 days written notice of such changed
address to the other party hereto.
15. HEADINGS.
The headings herein are for convenience of reference only, do not constitute
a part of this Agreement and shall not be deemed to limit or affect the
interpretation of any of the provisions hereof.
16. NO THIRD PARTY BENEFICIARIES.
This Agreement is intended for the benefit of the parties hereto and their
respective successors and permitted assigns, and is not for the benefit of, nor
may any provision hereof be enforced by, any other person.
17. FEES AND EXPENSES.
Each party shall pay for the fees and expenses of its own advisers, counsel,
accountants and other experts, if any, and all other expenses incurred by such
party incident to the negotiation, preparation, execution and delivery and
performance of this Agreement.
18. CONSENT TO JURISDICTION.
Each of the Company and the Purchaser (i) hereby irrevocably submits to the
nonexclusive jurisdiction of the United States District Court for the Southern
District of New York of any New York State Court sitting in New York for the
purposes of any suit, action or proceeding arising out of or relating to this
Agreement and (ii) hereby waives, and agrees not to assert in any such suit,
action or proceeding, any claim that it is not personally subject to the
jurisdiction of such court, that the suit,
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action or proceeding is brought in an inconvenient forum or that the venue of
the suit, action or proceeding is improper. Each of the Company and the
Purchaser consents to process being served in any such suit, action or
proceeding by mailing a copy thereof to such party at the address in effect for
notices to it under this Agreement and agrees that such service shall constitute
good and sufficient service of process and notice thereof. Nothing in this
paragraph shall affect or limit any right to serve process in any other manner
permitted by law.
IN WITNESS WHEREOF, the undersigned has caused this Offshore Securities
Subscription Agreement to be executed by a duly authorized officer.
-------------------------- ---------------------------------------
No. of Shares Name of Purchaser
-------------------------- By: ---------------------------------
Aggregate Purchase Price NAME:
TITLE:
Date: --------------------
---------------------------------------
Business Address
----------------- --------------------
Telephone Number Facsimile Number
ACCEPTED:
KCD HOLDINGS INCORPORATED
By: -----------------------------
NAME:
TITLE:
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SCHEDULE A
CATEGORIES OF U.S. PERSONS
1) Any natural person resident in the United States;
2) Any partnership or corporation organized or incorporated under the laws of
the United States;
3) Any estate of which any executor or administrator is a U.S. person;
4) Any trust of which any trustee is a U.S. person;
5) Any agency or branch of a foreign entity located in the U.S.;
6) Any non-discretionary account or similar account (other than estate or
trust) held by a dealer or other fiduciary for the benefit or account of a
U.S. person;
7) Any partnership or corporation if: (A) organized or incorporated under the
laws of any foreign jurisdiction; and (B) formed by a U.S. person
principally for the purpose of investment in securities not registered under
the Act, unless it is organized or incorporated, and owned, by accredited
investors (as defined in Rule 501 [a]) who are not natural persons, estates
or trusts.
8) Any employee benefit plan established and administered in accordance with
the law of a country other than the United States and customary practices
and documentation of such country shall not be deemed a U.S. person.
9) Any agency or branch of a U.S. person located outside the United States
shall not be deemed a "U.S. person" if:
the agency or branch operates for valid business reasons; and the
agency or branch is engaged in the business of insurance or banking
and is subject to substantive insurance or banking regulation,
respectively, in the jurisdiction where located.
10) The International Monetary Fund, the International Bank for Reconstruction
and Development, the Inter-American Development Bank, the Asian Development
Bank, the African Development Bank, the United States, and their agencies,
affiliates and pension plans, and any other similar international
organizations, their agencies, affiliates and pension plans shall not be
deemed "U.S. person".
