THESE SECURITIES ARE RESTRICTED SECURITIES AS THAT TERM IS DEFINED IN RULE 144
UNDER THE U.S. SECURITIES ACT OF 1933 (THE "ACT"). AS RESTRICTED SECURITIES,
THEY MAY BE RESOLD ONLY IN ACCORDANCE WITH REGULATIONS UNDER THE ACT OR PURSUANT
TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT OR AN EXEMPTION THEREFROM.
THESE SECURITIES HAVE NOT BEEN REGISTERED WITH THE UNITED STATES SECURITIES AND
EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE. THIS SUBSCRIPTION
AGREEMENT SHALL NOT CONSTITUTE AN OFFER TO SELL NOR A SOLICITATION OF AN OFFER
TO BUY THE SECURITIES IN ANY JURISDICTION IN WHICH SUCH OFFER OR SOLICITATION
WOULD BE UNLAWFUL. THE SECURITIES MAY NOT BE RESOLD OR TRANSFERRED EXCEPT AS
PERMITTED PURSUANT TO REGISTRATION UNDER THE ACT OR EXEMPTION THEREFROM.
THESE SECURITIES HAVE NOT BEEN RECOMMENDED BY ANY FEDERAL OR STATE SECURITIES
COMMISSION OR REGULATORY AUTHORITY. FURTHERMORE, THE FOREGOING AUTHORITIES HAVE
NOT REVIEWED, CONFIRMED OR DETERMINED THE ACCURACY OR ADEQUACY OF THIS DOCUMENT.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
SUBSCRIPTION AGREEMENT
As of March ___, 2000
This Subscription Agreement (this "Agreement") is being entered into between the
undersigned (the "Subscriber") and CORE SYSTEMS, INC., a. Nevada corporation
(the "Company") in connection with the offer and subscription by the Subscriber
for ____________ units of the Company's securities at a cost of $0.25 per unit
(each unit consists of one share and one warrant exercisable for a period of two
years to acquire one additional share at a price of $0.25). This Agreement
memorializes the transaction agreed to on March ___, 2000, the date on which the
Subscriber paid the Purchase Price (as defined in Section 1) to the Company. The
price per unit was fixed and all the representations and warranties were made on
that date. The offer and sale of securities was made in reliance upon the
provisions of Regulation S ("Regulation S") under the United States Securities
Act of 1933, as amended (the "Act"). References to "Shares" include shares
issued as part of units and shares issued on the exercise of the warrants
forming part of the units.
1. Offer to Subscribe; Purchase Price
The Subscriber purchased the securities at a price of U.S. Twenty-Five Cents
(U.S.$0.25) per unit on March ___, 2000 outside the United States of America
(the "Closing"). Payment was made to the Company's designated account at the
time of the Closing. The Company shall deliver a certificate representing the
Shares and Warrants to the Subscriber within a reasonable
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time hereafter. The obligations of each party were subject to the condition that
all the representations and warranties of the other party contained herein were
true at the time of Closing and all covenants of the other party that were to be
performed by the other party on or before the Closing had been performed.
2. Representations and Warranties of Subscriber; Certain Covenants
2.1 Offshore Transaction. Subscriber represents and warrants to the Company that
(i) Subscriber is not a "U.S. person" as that term is defined in Rule 902(c) of
Regulation S, (ii) at the time of execution of this Agreement, Subscriber was
outside the United States and no offer of the Shares was made to the Subscriber
within the United States; (iii) Subscriber purchased the Shares for its own
account and not on behalf of any U.S. person, and the sale of the Shares had not
been prearranged with any buyer in the United States and (iv) Subscriber is not
a distributor as defined in Regulation S. The Subscriber covenants that all
offers and sales of the Shares prior to the expiration of a period commencing on
the Closing and ending one-year thereafter (the "Restricted Period") shall not
be made to U.S. persons or for the account or benefit of U.S. persons and shall
otherwise be made in compliance with the provisions of Regulation S.
2.2 Independent Investigation. Subscriber, in electing to subscribe for the
Shares hereunder, relied upon an independent investigation made by it and its
representatives, if any, and had been given access to and the opportunity to
examine all books and records of the Company, and all material contracts and
documents of the Company. The Subscriber has such experience in business and
financial matters that it was capable of evaluating the risk of its investment
and determining the suitability of its investment.
2.3 No Government Recommendation or Approval. Subscriber understands that no
United States federal or state agency has passed upon or made any recommendation
or endorsement of the Company, this transaction or the purchase of the Shares.
2.4 No Registration. Subscriber understands that the Shares have not been
registered under the Act and are being offered and sold pursuant to Regulation S
based in part upon the representations of Subscriber contained herein, and that
the Company is relying on the truth and accuracy of the Subscriber's
representations and warranties herein to determine whether the offer and sale of
the Shares is exempt from registration under the Act.
2.5 Investment Intent. Subscriber acquired the Shares to be issued and sold
hereunder for its own account (or a trust account if such Subscriber is a
trustee) and not as a nominee. Subscriber understands that the purchase of the
Shares involves a high degree of risk and that Subscriber must bear the economic
risk of this investment indefinitely unless sale of the Shares is registered
pursuant to the Act, or an exemption from registration for sale thereof is
available. Subscriber understands that, in the view of the SEC, the statutory
basis for the exemption claimed for this transaction would not be present if the
offering of the Shares, although in technical compliance with Regulation S, is
part of a plan or scheme to evade the registration provisions of the Act.
Subscriber is acquiring the Shares for investment purposes and has no present
intention to sell the Shares in the United States, to a US. Person
Page 3 of 5
or for the account or benefit of a U.S. person. Subscriber covenants that
neither Subscriber nor its affiliates nor any person acting on its or their
behalf has the intention of entering or will enter during the Restricted Period,
into any put option, short position or other similar instrument or position or
any other hedging transactions or arrangements with respect to the Company's
common stock, and neither Subscriber nor any of its affiliates nor any person
acting on its or their behalf will use at any time Shares acquired pursuant to
this Agreement to settle any put option, short position or other similar
instrument or position or any other hedging transaction or arrangement that may
have been entered into prior to the execution of this Agreement or during the
Restricted Period.
3. [Page 3 of original missing.]
4. Legends; Subsequent Transfer of Shares
The certificates representing the Shares shall bear the legend set forth in the
first paragraph on the first page of this Agreement and any other legend, if
such legend or legends are reasonably required by the Company to comply with
state, federal or foreign law.
5. Representations, Warranties and Covenants of the Company
5.1 Organization and Good Standing. The Company is a corporation duly organized,
validly existing and in good standing under the laws of the State of Nevada and
has all requisite corporate power and authority to carry on its business as now
conducted and as proposed to be conducted.
5.2 Authorization. All corporate action on the part of the Company, its
officers, directors and shareholders necessary for the authorization, execution
and delivery of this Agreement, the performance of all obligations of the
Company hereunder and the authorization, issuance and delivery of the Shares
have been taken, and this Agreement constitutes a legal, valid and binding
obligation of the Company, enforceable against the Company in accordance with
its terms.
5.3 Valid Issuance of Shares. The Shares, when issued, sold and delivered in
accordance with the terms hereof for the Purchase Price will be duly and validly
issued and outstanding, fully paid and nonassessable, and based in part on the
representations and warranties of Subscriber will be issued in compliance with
all applicable federal, state and other applicable securities laws.
6. Governing Laws
This Agreement shall be governed by and construed in accordance with the laws of
the State of Nevada, except for matters arising under the Act or the Securities
Exchange Act of 1934 which matters shall be construed and interpreted in
accordance with such laws.
Page 4 of 5
7. Entire Agreement; Amendment
This Agreement constitutes the full and entire understanding and agreement
between the parties with regard to the subjects hereof and thereof, and no party
shall be liable or bound to any other party in any manner by any warranties,
representations or covenants except as specifically set forth herein or therein.
Except as expressly provided herein, neither this Agreement nor any term hereof
may be amended, waived, discharged or terminated other than by a written
instrument signed by the party against whom enforcement of any such amendment,
waiver, discharge or termination is sought.
8. Notices
Any notice, deemed or request required or permitted to be given by either the
Company or the Subscriber pursuant to the terms of this Agreement shall be in
writing and shall be deemed given when delivered personally or by facsimile,
with a hard copy to follow by two day courier addressed to the parties at the
addresses of the parties set forth at the end of this Agreement or such other
address as a party may request by notifying the other in writing.
9. Counterparts
This Agreement may be executed in any number of counterparts, each of which
shall be enforceable against the parties actually executing such counterparts,
and all of which together shall constitute one instrument.
10. Severability
In the event that any provision of this Agreement becomes or is declared by a
court of competent jurisdiction to be illegal, unenforceable or void, this
Agreement shall continue in full force and effect without said provision,
provided that no such severability shall be effective if it materially changes
the economics benefit of this Agreement to any party.
11. Titles and Subtitles
The titles and subtitles used in this Agreement are used for convenience only
and are not to be considered in construing or interpreting this Agreement.
WHEREAS the undersigned has caused this Agreement to be executed as of the date
first written above.
/s/ Incubus Investments Limited
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[print name]
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Authorized Signatory
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00 Xxxx Xx, Xx. George's
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Address
Trust Company, Xxxxxxxx Bermuda
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AGREED TO AND ACCEPTED:
CORE SYSTEMS, INC.
By:
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Authorized Signatory
