SUBSCRIPTION AGREEMENT
SUBSCRIPTION
AGREEMENT (this “Agreement”) made as of the last date set forth on the signature
page hereof between BioSolar, Inc. (the “Company”), and the undersigned (the
“Subscriber”).
W
I T N E
S S E T H:
WHEREAS,
the Company is conducting a private offering (the “Offering”) consisting of up
to 15,000,000 shares of common stock, par value $.0001 per share (“Shares”);
and
WHEREAS,
the Subscriber desires to purchase that number of Shares set forth on the
signature page hereof on the terms and conditions hereinafter set
forth.
NOW,
THEREFORE, in consideration of the premises and the mutual representations
and
covenants hereinafter set forth, the parties hereto do hereby agree as
follows:
I. |
SUBSCRIPTION
FOR SHARES AND REPRESENTATIONS BY
SUBSCRIBER
|
1.1 Subject
to the terms and conditions hereinafter set forth and in the Confidential
Offering Memorandum dated July 21, 2006 (such memorandum, together with all
amendments thereof and supplements and exhibits thereto, the “Memorandum”), the
Subscriber hereby irrevocably subscribes for and agrees to purchase from the
Company such number of Shares, and the Company agrees to sell to the Subscriber
as is set forth on the signature page hereof, at a per share price equal to
$0.10 per Share. The purchase price is payable by personal or business check
or
money order made payable to “BioSolar, Inc.”
contemporaneously with the execution and delivery of this Agreement by the
Subscriber. Subscribers may also pay the subscription amount by, wire transfer
of immediately available funds to:
Bank:
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Bank
of America
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00000
Xxxxxxx Xxxxxx Xxxx
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||
Xxxxx
Xxxxxxx, Xxxxxxxxxx 00000
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||
Account:
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10234-69102
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ABA:
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000000000
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1.2 The
Subscriber recognizes that the purchase of the Shares involves a high degree
of
risk including, but not limited to, the following: (a) the Company remains
a
development stage business with limited operating history and requires
substantial funds in addition to the proceeds of the Offering; (b) an investment
in the Company is highly speculative, and only investors who can afford the
loss
of their entire investment should consider investing in the Company and the
Shares; (c) the Subscriber may not be able to liquidate its investment; (d)
transferability of the Shares (sometimes hereinafter collectively referred
to as
the “Securities”) is extremely limited; (e) in the event of a disposition, the
Subscriber could sustain the loss of its entire investment; (f) the Company
has
not paid any dividends since its inception and does not anticipate paying any
dividends; and (g) the Company may issue additional securities in the future
which have rights and preferences that are senior to those of the Common Stock.
Without limiting the generality of the representations set forth in Section
1.5
below, the Subscriber represents that the Subscriber has carefully reviewed
the
section of the Memorandum captioned “Risk Factors.”
1.3 The
Subscriber represents that the Subscriber is an “accredited investor” as such
term is defined in Rule 501 of Regulation D (“Regulation D”) promulgated under
the Securities Act of 1933, as amended (the “Securities Act”), as indicated by
the Subscriber’s responses to the questions contained in Article VII hereof, and
that the Subscriber is able to bear the economic risk of an investment in the
Shares.
1.4 The
Subscriber hereby acknowledges and represents that (a) the Subscriber has
knowledge and experience in business and financial matters, prior investment
experience, including investment in securities that are non-listed, unregistered
and/or not traded on a national securities exchange nor on the National
Association of Securities Dealers, Inc. (the “NASD”) automated quotation system
(“NASDAQ”), or the Subscriber has employed the services of a “purchaser
representative” (as defined in Rule 501 of Regulation D), attorney and/or
accountant to read all of the documents furnished or made available by the
Company both to the Subscriber and to all other prospective investors in the
Shares to evaluate the merits and risks of such an investment on the
Subscriber’s behalf; (b) the Subscriber recognizes the highly speculative nature
of this investment; and (c) the Subscriber is able to bear the economic risk
that the Subscriber hereby assumes.
1.5 The
Subscriber hereby acknowledges receipt and careful review of this Agreement,
the
Memorandum (which includes the Risk Factors), including all exhibits thereto,
and any documents which may have been made available upon request as reflected
therein (collectively referred to as the “Offering Materials”) and hereby
represents that the Subscriber has been furnished by the Company during the
course of the Offering with all information regarding the Company, the terms
and
conditions of the Offering and any additional information that the Subscriber
has requested or desired to know, and has been afforded the opportunity to
ask
questions of and receive answers from duly authorized officers or other
representatives of the Company concerning the Company and the terms and
conditions of the Offering.
1.6 (a)In
making
the decision to invest in the Shares the Subscriber has relied solely upon
the
information provided by the Company in the Offering Materials. To the extent
necessary, the Subscriber has retained, at its own expense, and relied upon
appropriate professional advice regarding the investment, tax and legal merits
and consequences of this Agreement and the purchase of the Shares hereunder.
The
Subscriber disclaims reliance on any statements made or information provided
by
any person or entity in the course of Subscriber’s consideration of an
investment in the Shares other than the Offering Materials.
(b) The
Subscriber represents that (i) the Subscriber was contacted regarding the sale
of the Shares by the Company (or an authorized agent or representative thereof)
with whom the Subscriber had a prior substantial pre-existing relationship
and
(ii) no Shares were offered or sold to it by means of any form of general
solicitation or general advertising, and in connection therewith, the Subscriber
did not (A) receive or review any advertisement, article, notice or other
communication published in a newspaper or magazine or similar media or broadcast
over television or radio, whether closed circuit, or generally available; or
(B)
attend any seminar meeting or industry investor conference whose attendees
were
invited by any general solicitation or general advertising.
2
1.7 The
Subscriber hereby represents that the Subscriber, either by reason of the
Subscriber’s business or financial experience or the business or financial
experience of the Subscriber’s professional advisors (who are unaffiliated with
and not compensated by the Company or any affiliate or selling agent of the
Company, directly or indirectly), has the capacity to protect the Subscriber’s
own interests in connection with the transaction contemplated
hereby.
1.8 The
Subscriber hereby acknowledges that the Offering has not been reviewed by the
United States Securities and Exchange Commission (the “SEC”) nor any state
regulatory authority since the Offering is intended to be exempt from the
registration requirements of Section 5 of the Securities Act pursuant to
Regulation D promulgated thereunder. The Subscriber understands that the
Securities have not been registered under the Securities Act or under any state
securities or “blue sky” laws and agrees not to sell, pledge, assign or
otherwise transfer or dispose of the Securities unless they are registered
under
the Securities Act and under any applicable state securities or “blue sky” laws
or unless an exemption from such registration is available.
1.9 The
Subscriber understands that the Securities comprising the Shares have not been
registered under the Securities Act by reason of a claimed exemption under
the
provisions of the Securities Act that depends, in part, upon the Subscriber’s
investment intention. In this connection, the Subscriber hereby represents
that
the Subscriber is purchasing the Securities for the Subscriber’s own account for
investment and not with a view toward the resale or distribution to others.
The
Subscriber, if an entity, further represents that it was not formed for the
purpose of purchasing the Securities.
1.10 The
Subscriber understands that there is no public market for the Common Stock
and
that no market may develop for any of such Securities. The Subscriber
understands that even if a public market develops for such Securities, Rule
144
(“Rule 144”) promulgated under the Securities Act requires for non-affiliates,
among other conditions, a one-year holding period prior to the resale (in
limited amounts) of securities acquired in a non-public offering without having
to satisfy the registration requirements under the Securities Act. The
Subscriber understands and hereby acknowledges that the Company is under no
obligation to register any of the Securities under the Securities Act or any
state securities or “blue sky” laws other than as set forth in Article V.
1.11 The
Subscriber consents to the placement of a legend on any certificate or other
document evidencing the Securities that such Securities have not been registered
under the Securities Act or any state securities or “blue sky” laws and setting
forth or referring to the restrictions on transferability and sale thereof
contained in this Agreement. The Subscriber is aware that the Company will
make
a notation in its appropriate records with respect to the restrictions on the
transferability of such Securities. The legend to be placed on each certificate
shall be in form substantially similar to the following:
3
“THE
SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”) OR ANY STATE SECURITIES OR “BLUE
SKY LAWS,” AND MAY NOT BE OFFERED, SOLD, TRANSFERRED, ASSIGNED, PLEDGED OR
HYPOTHECATED ABSENT AN EFFECTIVE REGISTRATION THEREOF UNDER SUCH ACT OR
COMPLIANCE WITH RULE 144 PROMULGATED UNDER SUCH ACT, OR UNLESS THE COMPANY
HAS
RECEIVED AN OPINION OF COUNSEL, REASONABLY SATISFACTORY TO THE COMPANY AND
ITS
COUNSEL, THAT SUCH REGISTRATION IS NOT REQUIRED.”
1.12 The
Subscriber understands that the Company will review this Agreement and is hereby
given authority by the Subscriber to call Subscriber’s bank or place of
employment or otherwise review the financial standing of the Subscriber; and
it
is further agreed that the Company, at its sole discretion, reserves the
unrestricted right, without further documentation or agreement on the part
of
the Subscriber, to reject or limit any subscription, to accept subscriptions
for
fractional Shares and to close the Offering to the Subscriber at any time and
that the Company will issue stop transfer instructions to its transfer agent
with respect to such Securities.
1.13 The
Subscriber hereby represents that the address of the Subscriber furnished by
Subscriber on the signature page hereof is the Subscriber’s principal residence
if Subscriber is an individual or its principal business address if it is a
corporation or other entity.
1.14 The
Subscriber represents that the Subscriber has full power and authority
(corporate, statutory and otherwise) to execute and deliver this Agreement
and
to purchase the Shares. This Agreement constitutes the legal, valid and binding
obligation of the Subscriber, enforceable against the Subscriber in accordance
with its terms.
1.15 If
the
Subscriber is a corporation, partnership, limited liability company, trust,
employee benefit plan, individual retirement account, Xxxxx Plan, or other
tax-exempt entity, it is authorized and qualified to invest in the Company
and
the person signing this Agreement on behalf of such entity has been duly
authorized by such entity to do so.
1.16 The
Subscriber acknowledges that if he or she is a Registered Representative of
an
NASD member firm, he or she must give such firm the notice required by the
NASD’s Rules of Fair Practice, receipt of which must be acknowledged by such
firm in Section 7.4 below.
1.17 The
Subscriber acknowledges that at such time, if ever, as the Securities are
registered (as such term is defined in Article V hereof), sales of the
Securities will be subject to state securities laws.
1.18 (a)The
Subscriber agrees not to issue any public statement with respect to the
Subscriber’s investment or proposed investment in the Company or the terms of
any agreement or covenant between them and the Company without the Company’s
prior written consent, except such disclosures as may be required under
applicable law or under any applicable order, rule or regulation.
(b) The
Company agrees not to disclose the names, addresses or any other information
about the Subscribers, except as required by law; provided, that the Company
may
use the name of the Subscriber for any offering or in any registration statement
filed pursuant to Article V in which the Subscriber’s shares are
included.
1.19 The
Subscriber agrees to hold the Company and its directors, officers, employees,
affiliates, controlling persons and agents and their respective heirs,
representatives, successors and assigns harmless and to indemnify them against
all liabilities, costs and expenses incurred by them as a result of (a) any
sale
or distribution of the Securities by the Subscriber in violation of the
Securities Act or any applicable state securities or “blue sky” laws; or (b) any
false representation or warranty or any breach or failure by the Subscriber
to
comply with any covenant made by the Subscriber in this Agreement (including
the
Confidential Investor Questionnaire contained in Article VII herein) or any
other document furnished by the Subscriber to any of the foregoing in connection
with this transaction.
4
II. |
REPRESENTATIONS
BY AND COVENANTS OF THE COMPANY
|
The
Company hereby represents and warrants to the Subscriber that:
2.1 Organization,
Good Standing and Qualification.
The
Company is a corporation duly organized, validly existing and in good standing
under the laws of the State of Nevada and has full corporate power and authority
to conduct its business.
2.2 Capitalization
and Voting Rights.
The
Company has authorized 500,000,000 shares of Common Stock, par value $.0001
per
share, of which 119,500,000 shares are outstanding as of the date hereof. Except
as set forth in the Offering Materials, there are no outstanding options,
warrants, agreements, convertible securities, preemptive rights or other rights
to subscribe for or to purchase any shares of capital stock of the Company.
Except as set forth in the Offering Materials and as otherwise required by
law,
there are no restrictions upon the voting or transfer of any of the shares
of
capital stock of the Company pursuant to the Company’s Articles of Incorporation
(the “Articles of Incorporation”), By-Laws or other governing documents or any
agreement or other instruments to which the Company is a party or by which
the
Company is bound.
2.3 Authorization;
Enforceability.
The
Company has all corporate right, power and authority to enter into this
Agreement and to consummate the transactions contemplated hereby. All corporate
action on the part of the Company, its directors and stockholders necessary
for
the (i) authorization execution, delivery and performance of this Agreement
by
the Company; and (ii) authorization, sale, issuance and delivery of the
Securities contemplated hereby and the performance of the Company’s obligations
hereunder has been taken. This Agreement has been duly executed and delivered
by
the Company and constitutes a legal, valid and binding obligation of the
Company, enforceable against the Company in accordance with its terms, subject
to laws of general application relating to bankruptcy, insolvency and the relief
of debtors and rules of law governing specific performance, injunctive relief
or
other equitable remedies, and to limitations of public policy. The Common Stock,
when issued and fully paid for in accordance with the terms of this Agreement,
will be validly issued, fully paid and nonassessable. The issuance and sale
of
the Common Stock contemplated hereby will not give rise to any preemptive rights
or rights of first refusal on behalf of any person which have not been waived
in
connection with this offering.
5
2.4 No
Conflict; Governmental Consents.
(a) The
execution and delivery by the Company of this Agreement and the consummation
of
the transactions contemplated hereby will not result in the violation of any
material law, statute, rule, regulation, order, writ, injunction, judgment
or
decree of any court or governmental authority to or by which the Company is
bound, or of any provision of the Articles of Incorporation or By-Laws of the
Company, and will not conflict with, or result in a material breach or violation
of, any of the terms or provisions of, or constitute (with due notice or lapse
of time or both) a default under, any lease, loan agreement, mortgage, security
agreement, trust indenture or other agreement or instrument to which the Company
is a party or by which it is bound or to which any of its properties or assets
is subject, nor result in the creation or imposition of any lien upon any of
the
properties or assets of the Company.
(b) No
consent, approval, authorization or other order of any governmental authority
is
required to be obtained by the Company in connection with the authorization,
execution and delivery of this Agreement or with the authorization, issue and
sale of the Shares, except such filings as may be required to be made with
the
SEC, NASD, NASDAQ and with any state or foreign blue sky or securities
regulatory authority.
2.5 Licenses.
Except
as otherwise set forth in the Memorandum, the Company has sufficient licenses,
permits and other governmental authorizations currently required for the conduct
of its business or ownership of properties and is in all material respects
in
compliance therewith.
2.6 Litigation.
The
Company knows of no pending or threatened legal or governmental proceedings
against the Company which could materially adversely affect the business,
property, financial condition or operations of the Company or which materially
and adversely questions the validity of this Agreement or any agreements related
to the transactions contemplated hereby or the right of the Company to enter
into any of such agreements, or to consummate the transactions contemplated
hereby or thereby. The Company is not a party or subject to the provisions
of
any order, writ, injunction, judgment or decree of any court or government
agency or instrumentality which could materially adversely affect the business,
property, financial condition or operations of the Company. There is no action,
suit, proceeding or investigation by the Company currently pending in any court
or before any arbitrator or that the Company intends to initiate.
2.7 Disclosure.
The
information set forth in the Offering Materials as of the date hereof contains
no untrue statement of a material fact nor omits to state a material fact
necessary in order to make the statements contained therein, in light of the
circumstances under which they were made, not misleading.
6
2.8 Investment
Company.
The
Company is not an “investment company” within the meaning of such term under the
Investment Company Act of 1940, as amended, and the rules and regulations of
the
SEC thereunder.
2.9 Intellectual
Property.
(i) To
the
best of its knowledge, the Company owns or possesses sufficient legal rights
to
all patents, trademarks, service marks, trade names, copyrights, trade secrets,
licenses, information and other proprietary rights and processes necessary
for
its business as now conducted and as presently proposed to be conducted, without
any known infringement of the rights of others. Except as disclosed in the
Memorandum, there are no material outstanding options, licenses or agreements
of
any kind relating to the foregoing proprietary rights, nor is the Company bound
by or a party to any material options, licenses or agreements of any kind with
respect to the patents, trademarks, service marks, trade names, copyrights,
trade secrets, licenses, information and other proprietary rights and processes
of any other person or entity other than such licenses or agreements arising
from the purchase of “off the shelf” or standard products. The Company has not
received any written communications alleging that the Company has violated
or,
by conducting its business as presently proposed to be conducted, would violate
any of the patents, trademarks, service marks, trade names, copyrights or trade
secrets or other proprietary rights of any other person or entity.
(ii) Except
as
disclosed in the Memorandum, the Company is not aware that any of its employees
is obligated under any contract (including licenses, covenants or commitments
of
any nature) or other agreement, or subject to any judgment, decree or order
of
any court or administrative agency, that would interfere with their duties
to
the Company or that would conflict with the Company’s business as presently
conducted.
(iii) Neither
the execution nor delivery of this Agreement, nor the carrying on of the
Company’s business by the employees of the Company, nor the conduct of the
Company’s business as presently conducted, will, to the Company’s knowledge,
conflict with or result in a breach of the terms, conditions or provisions
of,
or constitute a default under, any contract, covenant or instrument under which
any employee is now obligated.
(iv) To
the
Company’s knowledge, no employee of the Company, nor any consultant with whom
the Company has contracted, is in violation of any term of any employment
contract, proprietary information agreement or any other agreement relating
to
the right of any such individual to be employed by, or to contract with, the
Company because of the nature of the business conducted by the Company; and
to
the Company’s knowledge the continued employment by the Company of its present
employees, and the performance of the Company’s contracts with its independent
contractors, will not result in any such violation. The Company has not received
any written notice alleging that any such violation has occurred. Except as
described in the Memorandum, no employee of the Company has been granted the
right to continued employment by the Company or to any compensation following
termination of employment with the Company except for any of the same which
would not have a material adverse effect on the business of the Company. The
Company is not aware that any officer, key employee or group of employees
intends to terminate his, her or their employment with the Company, nor does
the
Company have a present intention to terminate the employment of any officer,
key
employee or group of employees.
7
2.10 Title
to Properties and Assets; Liens, Etc.
The
Company has good and marketable title to its properties and assets, including
the properties and assets reflected in the most recent balance sheet included
in
the Financial Statements, and good title to its leasehold estates, in each
case
subject to no mortgage, pledge, lien, lease, encumbrance or charge, other than
(a) those resulting from taxes which have not yet become delinquent; (b) liens
and encumbrances which do not materially detract from the value of the property
subject thereto or materially impair the operations of the Company; and (c)
those that have otherwise arisen in the ordinary course of business. The Company
is in compliance with all material terms of each lease to which it is a party
or
is otherwise bound.
2.11 Obligations
to Related Parties.
Except
as described in the Memorandum, there are no obligations of the Company to
officers, directors, stockholders, or employees of the Company other than (a)
for payment of salary or other compensation for services rendered, (b)
reimbursement for reasonable expenses incurred on behalf of the Company and
(c)
for other standard employee benefits made generally available to all employees
(including stock option agreements outstanding under any stock option plan
approved by the Board of Directors of the Company). Except as may be disclosed
in the Memorandum, the Company is not a guarantor or indemnitor of any
indebtedness of any other person, firm or corporation.
III. |
TERMS
OF SUBSCRIPTION
|
3.1 There
is
no requirement that any minimum number of Shares be sold and therefore no escrow
will be established for subscription funds. Subscription funds may be deposited
by the Company directly into its operating account for use as described in
this
Confidential Offering Memorandum.
3.2 Certificates
representing the Common Stock purchased by the Subscriber pursuant to this
Agreement will be prepared for delivery to the Subscriber within 15 business
days following the Closing at which such purchase takes place. The Subscriber
hereby authorizes and directs the Company to deliver the certificates
representing the Common Stock purchased by the Subscriber pursuant to this
Agreement directly to the Subscriber’s residential or business address indicated
on the signature page hereto.
IV. |
CONDITIONS
TO OBLIGATIONS OF THE SUBSCRIBERS
|
4.1 The
Subscriber’s obligation to purchase the Shares at the Closing at which such
purchase is to be consummated is subject to the fulfillment on or prior to
such
Closing of the following conditions, which conditions may be waived at the
option of each Subscriber to the extent permitted by law:
8
(a) Covenants.
All
covenants, agreements and conditions contained in this Agreement to be performed
by the Company on or prior to the date of such Closing shall have been performed
or complied with in all material respects.
(b) No
Legal Order Pending.
There
shall not then be in effect any legal or other order enjoining or restraining
the transactions contemplated by this Agreement.
(c) No
Law
Prohibiting or Restricting Such Sale.
There
shall not be in effect any law, rule or regulation prohibiting or restricting
such sale or requiring any consent or approval of any person, which shall not
have been obtained, to issue the Securities (except as otherwise provided in
this Agreement).
V. |
LOCK-UP
AGREEMENT
|
5.1 The
Subscriber understands that the Company may file with the Securities and
Exchange Commission ("SEC")
a
registration statement on Form SB-2 (the "Registration Statement") to register
certain shares of the Company’s common stock and to exercise its reasonable best
efforts to cause the Registration Statement to become effective. The Company
may
also request a broker-dealer to file with the National Association of Securities
Dealers (the "NASD") to secure the listing or quotation of its Common Stock
on
the Over the Counter Bulletin Board market maintained by the National
Association of Securities Dealers, Inc.
5.2 As
an
inducement to NASD market makers to establish a public market for the common
stock, the Subscriber hereby agrees that from the date of the Confidential
Offering Memorandum and until one (1) year after the Registration Statement
is
declared effective by the SEC, the Subscriber will not exercise any rights
to
sell any unregistered shares of the Company's Common Stock as may be permitted
under SEC Rule 144.
VI. |
MISCELLANEOUS
|
6.1 Any
notice or other communication given hereunder shall be deemed sufficient if
in
writing and sent by registered or certified mail, return receipt requested,
or
delivered
by hand against written receipt therefor, addressed as follows:
if
to the
Company, to it at:
BioSolar,
Inc.
00000
Xxxx Xxxxxx Xxxx, Xxxxx 000
Xxxxx
Xxxxxxx, Xxxxxxxxxx 00000
Attn:
Xxxxx Xxx, Chief Executive Officer
With
a
copy to:
Sichenzia
Xxxx Xxxxxxxx Xxxxxxx LLP
0000
Xxxxxx xx xxx Xxxxxxxx
Xxx
Xxxx,
XX 00000
Attn:
Xxxxxxx Xxxxxxxxx, Esq.
9
if
to the
Subscriber, to the Subscriber’s address indicated on the signature page of this
Agreement.
Notices
shall be deemed to have been given or delivered on the date of mailing, except
notices of change of address, which shall be deemed to have been given or
delivered when received.
6.2 Except
as
otherwise provided herein, this Agreement shall not be changed, modified or
amended except by a writing signed by the parties to be charged, and this
Agreement
may not
be discharged except by performance in accordance with its terms or by a writing
signed by the party to be charged.
6.3 Subject
to the provisions of Section 5.10, this Agreement shall be binding upon and
inure to the benefit of the parties hereto and to their respective heirs, legal
representatives, successors and assigns. This Agreement sets forth the entire
agreement and understanding between the parties as to the subject matter hereof
and merges and supersedes all prior discussions, agreements and understandings
of any and every nature among them.
6.4 Upon
the
execution and delivery of this Agreement by the Subscriber, this Agreement
shall
become a binding obligation of the Subscriber with respect to the purchase
of
Common Stock as herein provided, subject, however, to the right hereby reserved
by the Company to enter into the same agreements with other subscribers and
to
add and/or delete other persons as subscribers.
6.5 NOTWITHSTANDING
THE PLACE WHERE THIS AGREEMENT MAY BE EXECUTED BY ANY OF THE PARTIES HERETO,
THE
PARTIES EXPRESSLY AGREE THAT ALL THE TERMS AND PROVISIONS HEREOF SHALL BE
CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK
WITHOUT REGARD TO SUCH STATE’S PRINCIPLES OF CONFLICTS OF LAW. IN THE EVENT THAT
A JUDICIAL PROCEEDING IS NECESSARY, THE SOLE FORUM FOR RESOLVING DISPUTES
ARISING OUT OF OR RELATING TO THIS AGREEMENT IS THE SUPREME COURT OF THE STATE
OF NEW YORK IN AND FOR THE COUNTY OF NEW YORK OR THE FEDERAL COURTS FOR SUCH
STATE AND COUNTY, AND ALL RELATED APPELLATE COURTS, THE PARTIES HEREBY
IRREVOCABLY CONSENT TO THE JURISDICTION OF SUCH COURTS AND AGREE TO SAID VENUE.
6.6 In
order
to discourage frivolous claims the parties agree that unless a claimant in
any
proceeding arising out of this Agreement succeeds in establishing his claim
and
recovering a judgment against another party (regardless of whether such claimant
succeeds against one of the other parties to the action), then the other party
shall be entitled to recover from such claimant all of its/their reasonable
legal costs and expenses relating to such proceeding and/or incurred in
preparation therefor.
6.7 The
holding of any provision of this Agreement to be invalid or unenforceable by
a
court of competent jurisdiction shall not affect any other provision of this
Agreement, which shall remain in full force and effect. If any provision of
this
Agreement shall be declared by a court of competent jurisdiction to be invalid,
illegal or incapable of being enforced in whole or in part, such provision
shall
be interpreted so as to remain enforceable to the maximum extent permissible
consistent with applicable law and the remaining conditions and provisions
or
portions thereof shall nevertheless remain in full force and effect and
enforceable to the extent they are valid, legal and enforceable, and no
provisions shall be deemed dependent upon any other covenant or provision unless
so expressed herein.
10
6.8 It
is
agreed that a waiver by either party of a breach of any provision of this
Agreement shall not operate, or be construed, as a waiver of any subsequent
breach by that same party.
6.9 The
parties agree to execute and deliver all such further documents, agreements
and
instruments and take such other and further action as may be necessary or
appropriate to carry out the purposes and intent of this Agreement.
6.10 This
Agreement may be executed in two or more counterparts each of which shall be
deemed an original, but all of which shall together constitute one and the
same
instrument.
6.11 Nothing
in this Agreement shall create or be deemed to create any rights in any person
or entity not a party to this Agreement, except (a) for the holders of
Registrable Securities.
[REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK]
11
VII. |
CONFIDENTIAL
INVESTOR QUESTIONNAIRE
|
7.1 The
Subscriber represents and warrants that he, she or it comes within one category
marked below, and that for any category marked, he, she or it has truthfully
set
forth, where applicable, the factual basis or reason the Subscriber comes within
that category. ALL INFORMATION IN RESPONSE TO THIS SECTION WILL BE KEPT STRICTLY
CONFIDENTIAL. The undersigned agrees to furnish any additional information
which
the Company deems necessary in order to verify the answers set forth
below.
Category
A The
undersigned is an individual (not a partnership, corporation, etc.) whose
individual net worth, or joint net worth with his or her spouse, presently
exceeds $1,000,000.
Explanation.
In calculating net worth you may include equity in personal property and real
estate, including your principal residence, cash, short-term investments, stock
and securities. Equity in personal property and real estate should be based
on
the fair market value of such property less debt secured by such
property.
Category
B The
undersigned is an individual (not a partnership, corporation, etc.) who had
an
income in excess of $200,000 in each of the two most recent years, or joint
income with his or her spouse in excess of $300,000 in each of those years
(in
each case including foreign income, tax exempt income and full amount of capital
gains and losses but excluding any income of other family members and any
unrealized capital appreciation) and has a reasonable expectation of reaching
the same income level in the current year.
Category
C The
undersigned is a director or executive officer of the Company which is issuing
and selling the Securities.
Category
D The
undersigned is a bank; a savings and loan association; insurance company;
registered investment company; registered business development company; licensed
small business investment company (“SBIC”); or employee benefit plan within the
meaning of Title 1 of ERISA and (a) the investment decision is made by a plan
fiduciary which is either a bank, savings and loan association, insurance
company or registered investment advisor, or (b) the plan has total assets
in
excess of $5,000,000 or (c) is a self directed plan with investment decisions
made solely by persons that are accredited investors. (describe
entity)
Category
E The
undersigned is a private business development company as defined in section
202(a)(22) of the Investment Advisors Act of 1940. (describe entity)
Category
F The
undersigned is either a corporation, partnership, Massachusetts business trust,
or non-profit organization within the meaning of Section 501(c)(3) of the
Internal Revenue Code, in each case not formed for the specific purpose of
acquiring the Common Stock and with total assets in excess of $5,000,000.
(describe entity)
12
Category
G The
undersigned is a trust with total assets in excess of $5,000,000, not formed
for
the specific purpose of acquiring the Securities, where the purchase is directed
by a “sophisticated investor” as defined in Regulation 506(b)(2)(ii) under the
Act.
Category
H The
undersigned is an entity (other than a trust) in which all of the equity owners
are “accredited investors” within one or more of the above categories. If
relying upon this Category alone, each equity owner must complete a separate
copy of this Agreement. (describe entity)
Category
I The
undersigned is not within any of the categories above and is therefore not
an
accredited investor.
The
undersigned agrees that the undersigned will notify the Company at any time
on
or prior to the Closing Date in the event that the representations and
warranties in this Agreement shall cease to be true, accurate and
complete.
7.2 SUITABILITY
(please
answer each question)
(a) For
an
individual Subscriber, please describe your current employment, including the
company by which you are employed and its principal business:
(b) For
an
individual Subscriber, please describe any college or graduate degrees held
by
you:
(c) For
all
Subscribers, please list types of prior investments:
13
(d) For
all
Subscribers, please state whether you have participated in other private
placements
before:
YES_______ NO_______
(e) If
your
answer to question (d) above was “YES”, please indicate frequency of such prior
participation in private
placements
of:
Public
Companies
|
Private
Companies
|
Public
or Private VoIP or other
Communications
Companies
|
|
Frequently
|
|||
Occasionally
|
|||
Never
|
(f) For
individual Subscribers, do you expect your current level of income to
significantly decrease in the foreseeable future:
YES_______ NO_______
(g) For
trust, corporate, partnership and other institutional Subscribers, do you expect
your total assets to significantly decrease in the foreseeable future:
YES_______ NO_______
(h) For
all
Subscribers, do you have any other investments or contingent liabilities which
you reasonably anticipate could cause you to need sudden cash requirements
in
excess of cash readily available to you:
YES_______ NO_______
(i) For
all
Subscribers, are you familiar with the risk aspects and the non-liquidity of
investments such as the securities for which you seek to subscribe?
YES_______ NO_______
(j)
For all
Subscribers, do you understand that there is no guarantee of financial return
on
this investment and that you run the risk of losing your entire
investment?
YES_______ NO_______
7.3 MANNER
IN WHICH TITLE IS TO BE HELD.
(circle
one)
(a) Individual
Ownership
(b) Community
Property
(c) Joint
Tenant with Right of
Survivorship
(both parties must
sign)
(d) Partnership*
(e) Tenants
in Common
(f) Company*
14
(g) Trust*
(h) Other*
*If
Securities are being subscribed for by an entity, the attached Certificate
of
Signatory must also be completed.
7.4 NASD
AFFILIATION.
Are
you
affiliated or associated with an NASD member firm (please check
one):
Yes
_________ No
__________
If
Yes,
please describe:
_____________________________________________________________________________________
_____________________________________________________________________________________
_____________________________________________________________________________________
*If
Subscriber is a Registered Representative with an NASD member firm, have the
following acknowledgment signed by the appropriate party:
The
undersigned NASD member firm acknowledges receipt of the notice required by
Article 3, Sections 28(a) and (b) of the Rules of Fair Practice.
_________________________________
Name
of
NASD Member Firm
By:
______________________________
Authorized
Officer
Date:
____________________________
7.5 The
undersigned is informed of the significance to the Company of the foregoing
representations and answers contained in the Confidential Investor Questionnaire
contained in this Article VII and such answers have been provided under the
assumption that the Company will rely on them.
[REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK]
15
NUMBER
OF SHARES _________ X $0.10 = $_________ (the “Purchase
Price”)
|
||
Signature
|
Signature
(if purchasing jointly)
|
|
|
||
Name
Typed or Printed
|
Name
Typed or Printed
|
|
|
||
Title
(if Subscriber is an Entity)
|
Title
(if Subscriber is an Entity)
|
|
|
||
Entity
Name (if applicable)
|
Entity
Name (if applicable
|
|
Xxxxxxx
|
Xxxxxxx
|
|
|
||
Xxxx,
Xxxxx xxx Xxx Xxxx
|
Xxxx,
Xxxxx and Zip Code
|
|
|
||
Telephone-Business
|
Telephone-Business
|
|
|
||
Telephone-Residence
|
Telephone-Residence
|
|
|
||
Facsimile-Business
|
Facsimile-Business
|
|
|
||
Facsimile-Residence
|
Facsimile-Residence
|
|
|
||
Email
|
Email
|
|
|
||
Tax
ID # or Social Security #
|
Tax
ID # or Social Security #
|
Dated:
_____________,
2006
This
Subscription Agreement is agreed to and accepted as of
________________ ,
2006.
BIOSOLAR, INC. | ||
|
|
|
By: | ||
Name: |
||
Title: |
16
CERTIFICATE
OF SIGNATORY
(To
be
completed if Shares are
being
subscribed for by an entity)
I,
____________________________, am the ____________________________ of
__________________________________________ (the “Entity”).
I
certify
that I am empowered and duly authorized by the Entity to execute and carry
out
the terms of the Subscription Agreement and to purchase and hold the Common
Stock, and certify further that the Subscription Agreement has been duly and
validly executed on behalf of the Entity and constitutes a legal and binding
obligation of the Entity.
IN
WITNESS WHEREOF, I have set my hand this ________ day of _________________,
2006
(Signature) |
17