STOCK SUBSCRIPTION AGREEMENT
THIS STOCK SUBSCRIPTION AGREEMENT (the "Agreement") is made and entered
into on this _______ day of ______________, 2000, by and between Agate
Technologies, Inc., a Delaware corporation ("AGATE" or the "Company") and
________________________, a resident of the State of ________________ (the
"Purchaser").
RECITALS
A. AGATE is in the process of selling approximately 2,000,000 units (the
"Units").
B. Having had an opportunity to discuss the Company's business and
prospects with the principals, officers, and/or representatives of
AGATE, the Purchaser has expressed an interest in purchasing the Units
of AGATE and AGATE has expressed an interest in selling such Units, on
the terms and conditions set forth in this Agreement.
C. If and when accepted by AGATE, this Agreement shall constitute a
subscription for Units in the amount set forth herein. Each part of
this Agreement must be completed by the Purchaser and, by his or her
execution below, he or she acknowledges and understands that the
Company is relying upon the accuracy and completeness of this document
in complying with its obligations under applicable securities laws.
AGREEMENT
NOW, THEREFORE, in exchange for the consideration and mutual covenants
and agreements set forth in this Agreement, the parties hereto hereby represent,
warrant and agree as follows:
1. PURCHASE OF UNITS. Purchaser agrees to purchase, and AGATE agrees to
sell, units of AGATE, each unit to contain one share of Common Stock
("Share") and one warrant ("Warrant") to acquire an additional share of
common stock, at an exercise price of $1.00, payable within six months
of the date of purchase of the unit (the Warrant and Share together
comprising the "Unit"). The price, per Unit, is $1.00. The minimum
purchase required by an individual investor is 5,000 Units ($5,000).
However, the Company reserves the right, at its sole discretion, to
waive such minimum investment requirement, and further reserves the
right to reject any subscription for any reason.
2. METHOD OF SUBSCRIPTION. The Purchaser understands that before his or
her subscription for the Units will be accepted, he or she must have
completed, executed, acknowledged, sworn to (where required) and
delivered to the Company, the following:
a. This Subscription Agreement; and
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b. Cash, check, wire transfer or other form of certified funds
payable to the order of "Agate Technologies, Inc." in the
amount of $1.00 for each Unit subscribed.
The Purchaser further agrees that this subscription is and shall be
irrevocable, but the obligations hereunder will terminate if this
subscription is not accepted by the Company in whole or in part, by the
Closing Date, October 31, 2000 (unless extended by the Company). The
Purchaser understands that the Company will notify him or her whether
this subscription has been accepted or rejected, in whole or in part,
within ten (10) days after delivery to the Company or the Closing Date,
whichever is first. If this subscription is rejected by the Company,
all funds and documents tendered by the Purchaser shall be returned
promptly, without interest or deduction. It is understood that the
Company shall have the sole discretion of determining which of the
subscriptions should be rejected.
3. THE UNITS. Each Unit consists of one common share, $0.0001 par value,
and one Warrant to acquire a common share at a purchase price of $1.00.
Any shares will have voting rights equal to all other outstanding
common shares of stock of the Company. The shares of Common Stock
issuable upon purchase of Units (and/or exercise of Warrants) in this
Offering, when issued in accordance with the terms of the Offering,
will be fully paid and non-assessable.
4. PROCEEDS OF SALE. Purchaser acknowledges and agrees that Purchaser is
acquiring Units of AGATE, that AGATE is the seller of such Units and
that the proceeds of the sale are accordingly being paid to AGATE. All
money paid by Purchaser to acquire AGATE Units shall be deposited into
the bank accounts of AGATE and shall thereafter be available to AGATE
to use for the purposes of AGATE.
5. STOCK RESTRICTIONS. The securities being sold under this Agreement are
being issued pursuant to private offering exemptions from registration
under the federal securities laws and qualification under state
securities laws. Therefore, the securities being issued under this
Agreement are restricted and not freely tradable and will not be freely
tradable unless such restrictions lapse and the stock is subsequently
registered or otherwise becomes transferable in compliance with certain
securities regulations, such as Rule 144 under the Securities Act of
1933, as amended (the "Act"), further described at paragraph
5(a)(viii).
6. REPRESENTATIONS AND WARRANTIES OF PURCHASER. In agreeing to purchase
the Units of AGATE as described in this Agreement, the Purchaser hereby
represents and warrants to AGATE that:
a. INVESTMENT REPRESENTATIONS.
i. The Purchaser is experienced in evaluating and
investing in highly speculative companies such as
AGATE.
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ii. Prior to entering into this Agreement, the Purchaser
had a pre-existing relationship with AGATE, and/or
their principals, officers, directors, agents and/or
representatives.
iii. The Purchaser has had an opportunity to discuss
AGATE's business, management and financial affairs
with AGATE's management and has had the opportunity
to inspect AGATE's books and records. The Purchaser
has made his or her own independent investigation of
AGATE and has been furnished with such information
relating to AGATE as the Purchaser has requested. The
Purchaser hereby represents that the Purchaser has
had a reasonable time to review and investigate all
matters and information which the Investor believes
might be material to his or her investment in AGATE's
securities, and that the Purchaser is aware that
AGATE is relying on the accuracy of such
representations in agreeing to offer the Units to the
Purchaser at this time.
iv. In making his or her decision to purchase the Units
pursuant to this Agreement, the Purchaser has relied
solely upon the information furnished or made
available by AGATE described in this Agreement and on
the Purchaser's own analysis and due diligence.
v. The Purchaser understands that no federal or state
agency has passed upon an investment in the Units or
made any finding or determination as to the
advisability or fairness of an investment in the
Units.
vi. The Purchaser understands that the Purchaser must
bear the economic risk of investment in the Units for
an indefinite period of time, as the Units have not
been registered under the Act and, therefore, cannot
be sold unless they are either subsequently
registered under the Act or an exemption from such
registration is available.
vii. The Purchaser understands that there can be no
assurance that AGATE will be able to fulfill its
Business Plan or achieve its goals with the proceeds
raised under this exempt private offering, that it
may be necessary for AGATE to raise additional
investment capital or that AGATE will be successful
in raising such additional capital should such a need
arise. Accordingly, the Purchaser understands that an
investment in the Units of AGATE bears a high degree
of risk, is speculative and may result in the entire
loss of the Purchaser's investment.
viii. The Purchaser understands that he or she may not
resell the Units if he or she is deemed to have
engaged in a distribution of the Units or otherwise
deemed to be an underwriter thereof, unless he or she
registers the sale with
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the Securities and Exchange Commission. Purchaser is
further aware of the provisions of Rule 144
promulgated under the Act ("Rule 144"), which sets
forth the conditions under which a seller of
"restricted securities," as that term is defined in
the Rule, shall be deemed not to be engaged in a
distribution of such securities and therefore not an
underwriter thereof. Purchaser understands and
acknowledges that the Units are "restricted
securities," as defined in Rule 144, and that the
sale of the Units by Purchaser may not be made except
in compliance with Rule 144. Rule 144 includes, but
is not limited to, the following conditions: (1)
sales of restricted securities may not be made (a)
less than one year after such purchaser has purchased
and paid for the security to be sold, subject to
volume limitations and other conditions of the Rule,
or (b) by non-affiliates, not less than two years
after the securities to be sold have been purchased
and paid for; (2) sales must be made through a
"broker's transaction;" and (3) AGATE must satisfy
certain current public information requirements under
the Rule. AGATE presently does satisfy the current
public information requirements of Rule 144.
ix. The Purchaser is acquiring the Shares for investment
for the Purchaser's own account and not with the view
to, or for resale in connection with, any
distribution thereof. The Purchaser understands that
the Units have not been registered under the Act by
reason of one or more exemptions from the
registration provisions of the Act, which requires,
among other things, the bona fide nature of the
Purchaser's investment intent as expressed herein.
x. The Purchaser is authorized and otherwise duly
qualified to purchase and hold the Shares, and has
his or her principal residence or place of business
at the address designated by the Purchaser at the end
of this Agreement.
xi. The Purchaser represents that the Purchaser is an
"Accredited Investor" under the Act by virtue of
having (PLEASE INITIAL WHERE APPLICABLE):
__________ An individual net worth, or joint net worth
with the Purchaser's spouse, in excess of $
1,000,000; or
__________ An individual net income in excess of
$200,000 in each of the two most recent
years, or joint net income with the
Purchaser's spouse in excess of $300,000 in
each of those years, and a reasonable
expectation of reaching the same income
level in the current year; or
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__________ A bank or savings and loan association
acting in either its individual or a
fiduciary capacity; any broker/dealer
registered pursuant to Section 15 of the
Securities Exchange Act of 1934, as amended;
an insurance company; an investment company
registered under the Investment Company Act
of 1940 or a business development company as
defined in that Act; a Small Business
Investment Partnership licensed by the U.S.
Small Business Administration; an employee
benefit plan within the meaning of the
Employee Retirement Income Security Act of
1974, so long as the decision to invest in
the Partnership is being made by a fiduciary
which is either a bank, savings and loan
association, insurance company or registered
investment advisor, or if the employee
benefit plan has total assets in excess of
$5,000,000 at the date hereof, or is a
self-directed plan, with investment
decisions made solely by persons that are
accredited investors; or a private business
development company as defined in Section
202(a)(22) of the Investment Advisors Act of
1940; or a corporation, partnership or other
entity in which all of the equity owners
qualify as accredited investors under any
one or more of the previous categories.
xii. The Purchaser hereby indemnifies and holds harmless
AGATE and any of AGATE's officers, employees,
shareholders, agents, directors or control persons
("Indemnified Persons") who was or is a party or is
threatened to be made a party to any pending or
threatened action, suit or proceeding arising from
any misrepresentation or omission of material facts
by the Purchaser, including without limitation the
information in this Agreement, against losses,
liabilities or expenses of the Indemnified Persons
(including attorneys' fees, judgments, fines and
amounts paid in settlement) actually incurred by such
person or entity in connection with such action, suit
or proceeding.
xiii. If the Purchaser is more than one person, the
obligations of the Purchaser shall be joint and
several and the representations and warranties herein
contained shall be deemed to be made by and be
binding upon each such person and his or her heirs,
executors, administrators, successors and assigns.
b. FURTHER LIMITATIONS ON DISPOSITION. Without in any way
limiting the representations set forth above, the Purchaser
further agrees not to make any disposition of all or any
portion of the Units, including any distribution to any
partners of the Purchaser, unless and until there is then in
effect a Registration Statement under the Act covering such
proposed disposition and such disposition is made in
accordance with such Registration Statement; or Purchaser
delivers to AGATE an opinion of legal counsel that is
acceptable, in the sole discretion of AGATE, that such
disposition will not require registration of such Units under
the Act.
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c. LEGENDS. It is understood that the certificate(s) representing
the Units may bear one or all of the following restrictive
legends:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 AND MAY NOT BE
TRANSFERRED, SOLD, PLEDGED, HYPOTHECATED, OR OTHERWISE
DISPOSED OF EXCEPT IN ACCORDANCE WITH THAT ACT AND THE RULES
AND REGULATIONS PROMULGATED THEREUNDER";
"THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933. THEY MAY NOT BE SOLD, OFFERED FOR
SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF A REGISTRATION
STATEMENT IN EFFECT WITH RESPECT TO THE SECURITIES UNDER SUCH
ACT OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT
SUCH REGISTRATION IS NOT REQUIRED OR UNLESS SOLD PURSUANT TO
RULE 144 OF SUCH ACT";
"THE Units REPRESENTED BY THIS CERTIFICATE HAVE BEEN ISSUED
PURSUANT TO THAT CERTAIN STOCK SUBSCRIPTION AGREEMENT DATED
_________________ BETWEEN THE COMPANY AND THE ISSUEE WHICH
RESTRICTS THE TRANSFERABILITY OF THESE Units";
and/or such other legend or legends as AGATE and its counsel
deem necessary or appropriate.
d. ACKNOWLEDGMENT OF RISK FACTORS. The Purchaser acknowledges
that an investment in the Units of AGATE is highly speculative
and subject to significant risks. Therefore, the Purchaser
represents that he or she has the financial capability of
bearing the loss of the Purchaser's entire investment in the
Units. In addition to the investment risks discussed in other
sections of this Agreement, the Purchaser represents and
warrants that he or she acknowledges and understands the
following risk factors associated with AGATE and the purchase
of its Units.
7. REPRESENTATIONS AND WARRANTIES OF AGATE. In agreeing to sell the Units
to the Purchaser, AGATE hereby represents and warrants to the
Purchaser:
a. AUTHORIZATION. All corporate action on the part of AGATE, its
officers, directors and shareholders necessary for the
authorization, execution and delivery of this Agreement, the
performance of all obligations of AGATE hereunder, including
the issuance, sale and delivery of the Units, has been taken
or will be taken prior to the Closing. Upon execution and
delivery, this Agreement will be a valid and binding
obligation of AGATE enforceable in accordance with its terms,
except as may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other
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laws of general application relating to or affecting
enforcement of creditors' rights and by general equitable
principles.
b. GOVERNMENTAL CONSENTS. No consent, approval, order or
authorization of, or registration, qualification, designation,
declaration or filing with, any federal, state or local
governmental authority on the part of AGATE is required in
connection with the valid execution and delivery of this
Agreement, or the offer, sale or issuance of securities of
AGATE hereunder, except such as has already been obtained or
as is not required to be obtained prior to the Closing.
c. COMPLIANCE WITH OTHER INSTRUMENTS. AGATE is not and shall not
be in violation or default of any provision of (i) their
Articles of Incorporation or Bylaws, as amended and in effect
on and as of the date of the Closing, or (ii) any material
contract, agreement or instrument to which it is a party or by
which it is bound or, to its knowledge, may be bound or (iii)
any federal, state or local judgment, writ, decree, order,
statute, rule or governmental regulation applicable to AGATE.
The execution, delivery and performance of this Agreement and
the consummation of the transactions contemplated hereby will
not result in any such violation or contravene or constitute,
with or without the passage of time and giving of notice,
either a default under any such provision or result in the
creation or imposition of any lien, charge or encumbrance upon
any assets of AGATE.
d. CORPORATE DOCUMENTS. The Articles of Incorporation and Bylaws
of AGATE will be provided or made available to the Purchaser,
upon request, for review and approval prior to the Closing.
e. SECURITIES LAWS. Based in part upon the representations of the
Purchaser, the issuance, sale and delivery of the Units
pursuant to the terms of this Agreement shall be exempt from
the registration requirements of Section 5 of the "Act" by
virtue of Sections 3 and 4(2) thereof.
f. PERFORMANCE. AGATE shall have materially performed and
complied with all material agreements, obligations and
conditions contained in this Agreement that are required to be
performed or complied with by it on or before each Closing.
g. PROCEEDINGS AND DOCUMENTS. All corporate and other proceedings
in connection with the transactions contemplated hereby and
all documents and instruments incident thereto shall be
reasonably satisfactory in form and substance to the
Purchaser. The Purchaser shall have received all such
counterparts, originals and certified or other copies of such
documents as the Purchaser may reasonably request.
The foregoing representations and warranties of AGATE contained shall
be true on and as of the date of Closing with the same effect as though
such representations and warranties had
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been made on and as of the date of such Closing.
8. MISCELLANEOUS PROVISIONS.
a. ENTIRE AGREEMENT. This Agreement embodies the entire agreement
and understanding between the parties hereto with respect to
the subject matter hereof and supersedes all prior agreements
and understandings relating to such subject matter.
b. ASSIGNABILITY. This Subscription Agreement is neither
transferrable nor assignable by the Purchaser.
c. NOTICES. All notices, consents and other communications
hereunder shall be in writing and shall be deemed given when
delivered personally, by facsimile, with receipt confirmed,
provided that an original counterpart is promptly mailed by
registered or certified mail, five days after being mailed by
registered or certified mail, postage prepaid, or when
received by the addressee, if sent by Express Mail, Federal
Express, United Parcel Service, DHL or other express delivery
or courier service, in each case to the appropriate address or
facsimile number of the parties at their respective addresses
set forth below, or to such other address or facsimile number
for a party as shall be specified by like notice (provided
that notices of a change of address or facsimile number shall
be effective only upon receipt):
i. If to Agate:
Agate Technologies, Inc.
000 Xxxxxxxxx Xxxxxxxxxx
Xxxxxxxx, Xxxxxxxxxx 00000
Facsimile: (000) 000-0000
Attn: Xxxxxxx Xxx, Chief Financial Officer
Or such other address which AGATE may designate as a
business address.
ii. If to the Purchaser:
------------------------------
------------------------------
------------------------------
------------------------------
Or such other address that the Purchaser may
designate as a business address.
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d. MODIFICATIONS. The provisions of this Agreement may be waived,
altered, amended or repealed, in whole or in part, only upon
the written consent of all parties to this Agreement.
e. GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of
California with venue for the resolution of any claims or
disputes arising hereunder to be in the Superior Court of the
State of California for the County of Los Angeles.
f. SUCCESSORS. Anything in this Agreement to the contrary
notwithstanding, this Agreement shall be binding upon, and
shall inure to the benefit of, the heirs, successors or
assigns of AGATE and the Purchaser.
g. FURTHER ASSURANCES. Each of the parties hereto agrees that,
during the term of this Agreement, such party will take such
reasonable actions and shall execute such additional documents
and instruments as may be necessary and appropriate to give
effect to the purposes and the provisions of this Agreement.
h. REMEDIES. The parties hereto shall have all remedies for
breach of this Agreement available to them provided by law or
equity. Without limiting the generality of the foregoing, the
parties agree that, in addition to all other rights and
remedies available at law or in equity, the parties shall be
entitled to obtain specific performance of the obligations of
each party to this Agreement and immediate injunctive relief
and that in the event any action or proceeding is brought in
equity to enforce the same, no Unitholder will proffer, as a
defense, that there is an adequate remedy at law.
i. ATTORNEY'S FEES. Should any dispute arise between the parties
to this Agreement regarding the rights, remedies or relief
afforded by this Agreement, then, in addition to the relief
the prevailing party may be awarded by a court or arbitrator,
that party shall also be entitled to actual attorneys' fees
incurred by him or her.
j. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, including facsimile copies, each of which shall
be deemed an original, but all of which together shall
constitute one and the same instrument.
k. SUBSEQUENT EVENTS. Subsequent to the date of the Company's
latest SEC filing, the Company has completed a private
placement of $107,250, in exchange for 214,500 shares (12
Sep.); borrowed a total of $327,500 in the form of short term
loans from officers for operating capital (25 Sep); and
tentatively engaed the services of a new VP for Business
Development, Mr. Xxx Plant, and Mr. Koh Xxx Xxxxx as Chief
Technology Officer. Xxxxxxx Xxx has resigned in anticipation
of Mr. Plant's hiring.
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9. AMOUNT OF SUBSCRIPTION.
a. Number of Units of the Company ________________
b. Total Capital Contribution
($5,000 minimum, per Investor) $ ______________
10. FORM OF OWNERSHIP FOR UNITS. The undersigned elects to hold title to
the Units subscribed for herein as follows (check one):
[ ] Individual Ownership
(one signature required)
[ ] Community Property
(one signature required if interest held in one name (i.e.,
managing spouse), two signatures required if Units held in
both names)
[ ] Tenants in Common
(both parties must sign)
[ ] Joint Tenants with Right of Survivorship (both parties must sign)
[ ] Trust
(include name of trust, name of trustee, date trust was formed
and a copy of the Trust Agreement or other authorization)
[ ] Partnership
(include a copy of the Statement of Partnership or Partnership
Agreement authorizing signature)
[ ] Corporation
(include certified corporate resolution authorizing signature)
[ ] Qualified Retirement Plan (or XXX)
--------------------------------------------------------------------------------
(Print the exact name (registration) Subscriber desires on account) // Soc. Sec.
# or Tax I.D. #
SOCIAL SECURITY OR TAXPAYER I.D. NUMBER MUST APPEAR ABOVE OR WITHHOLDING
PROVISIONS WILL BE IMPOSED UPON THE COMPANY.
(If a trust, date trust established and name of trustee:
__________________________________)
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(Note: Investors should seek the advice of an attorney in deciding in which of
the above forms to take ownership of the Units. Different forms of ownership can
have varying gift tax, estate tax, income tax and other consequences, depending
on the state of the Purchaser's domicile and his or her particular personal
circumstances.)
IN WITNESS WHEREOF, subject to acceptance by the Company, the
undersigned has completed and executed this Subscription Agreement as of the day
and year first above written.
PURCHASER #1 PURCHASER #2
----------------------------- -----------------------------
Signature Signature
----------------------------- -----------------------------
Name (Please Print) Name (Please Print)
----------------------------- -----------------------------
Address Address
----------------------------- -----------------------------
----------------------------- -----------------------------
E-mail E-mail
----------------------------- -----------------------------
Telephone Number Telephone Number
A copy of this Subscription Agreement will be returned to you when countersigned
below. The Company has accepted this Subscription this _______ day of
______________, 2000.
AGATE TECHNOLOGIES, INC.
By:____________________________________
Xxxxxxx Xxx, Chief Financial Officer
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