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Exhibit 10.63
SUBSCRIPTION AGREEMENT
Private Placement of Common Stock,
Par Value $.001 per Share
THIS AGREEMENT, made this 11th day of June, 1999, by and among J.K.K.
HOLDINGS, LLP (the "Purchaser") and VISION TWENTY-ONE, INC., a Florida
corporation (the "Corporation"):
W I T N E S S E T H:
WHEREAS, the Purchaser desires to purchase shares of the Corporation's
common stock and the Corporation desires to sell shares of its common stock as
set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants, premises and
agreement of the parties hereto and of the mutual benefits to be gained by the
performance thereof and for other good and valuable consideration, the receipt
and adequacy of which hereby are acknowledged, the parties hereto, for
themselves and their respective heirs, personal representatives, successors and
assigns covenant and agree as follows:
1. Subscription. The Purchaser hereby elects to participate in the
Corporation by subscribing to purchase 117,666 shares of the common stock, par
value $.001 per share, offered hereby (the "Common Stock") at a price of $6.00
per share in accordance with the terms and conditions set forth herein.
2. Purchase Price. The purchase price for the Common Stock subscribed
for hereby is equal to $6.00 per share, or $706,000 in total for purchase of the
117,666 shares of Common Stock subscribed for herein.
3. High Risk of Loss of Investment. There are risks incident to the
ownership of Common Stock in the Corporation. This investment is speculative.
4. Representations by Undersigned. The Purchaser represents and
warrants to the Corporation and its officers and directors as follows:
(a) The Purchaser has been given (i) access to all books and
records, legal documents and other material information of the
Corporation; (ii) access to all material contracts and documents of the
Corporation relating to the issuance of the Common Stock and the
Corporation's business; and (iii) an opportunity to ask questions of
and receive answers from the executive officers of the Corporation,
regarding the information in (i) and (ii) above.
(b) The Purchaser is advised that the Common Stock subscribed
for hereby has not been registered under the Securities Act of 1933, as
amended (the "Act"), or any
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applicable state securities laws in reliance upon exemption provisions
of the Act and such other laws; and accordingly, no Federal or state
agency has made any recommendation or endorsement as to, or otherwise
passed on the merits of, purchasing the Common Stock.
(c) Because the Common Stock has not been registered under the
Act or state law, the Purchaser of the Common Stock must bear the
economic risks of investment for an indefinite period of time. The
Purchaser is advised that it will not be possible to readily liquidate
his or her investment. The Purchaser is further aware that such
registration in the future is uncertain and that the Corporation is not
under any obligation to register the Common Stock or assist in
complying with any exemption from registration, except as set forth
below.
(d) The Purchaser has read, is familiar with and understands
Rule 501 of Regulation D and represents that the Purchaser is an
"accredited investor" as defined in Rule 501(a) of Regulation D under
the Act. The Purchaser represents that he or she has (i) a net worth of
at least $1,000,000, exclusive of his home, home furnishings and
automobiles; (ii) annual income of at least $200,000, which he or she
represents is sufficient to provide for his or her personal needs,
living expenses, and contingencies; (iii) an overall commitment to
investments which are not readily marketable that is not
disproportionate to his or her net worth so that an investment in the
Common Stock will not cause such overall commitment to be excessive;
and (iv) such knowledge and experience in business and financial
matters that he or she is capable of evaluating the Corporation and its
proposed activities and the merits of investment in the Common Stock.
The Purchaser further represents that he is a director. The Purchaser
has adequate means of providing for his or her current needs and
personal contingencies and has no need for liquidity in his or her
investment and can afford to lose the entire amount of the investment.
(e) The Purchaser has made such independent inquiries as he or
she deems necessary to evaluate properly his or her investment in the
Common Stock, including consultation with his or her personal legal and
tax advisors to determine whether the investment is appropriate for him
or her.
(f) The Purchaser is over twenty-one (21) years of age.
(g) The Purchaser: (i) is acquiring the Common Stock solely
for the Purchaser's own account for investment purposes only and not
with a view toward resale or distribution thereof, either in whole or
in part; (ii) has no contract, undertaking, agreement or other
arrangement, in existence or contemplated, to sell, pledge, assign or
otherwise transfer the Common Stock to any other person; and (iii)
agrees not to sell or otherwise transfer the Common Stock unless and
until the Common Stock is subsequently registered under the 1933 Act
and any applicable state securities laws, or unless an exemption from
any such requirement is available. No other person or entity will have,
upon consummation of the transactions contemplated herein, a direct or
indirect beneficial interest in the Common Stock. The Purchaser does
not currently have any reason to anticipate any change in his or her
circumstances or other particular
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occasion or event which would cause him or her to sell his Common
Stock.
(h) The Purchaser understands that the statutory basis on
which the Common Stock is being offered, sold and/or issued to the
Purchaser would not be available if the Purchaser's present intention
were to hold the Common Stock for a fixed period of time or until the
occurrence of a certain event. The Purchaser realizes that, in the view
of the Securities and Exchange Commission (the "Commission"), a
purchase of the Common Stock now with a present intention to resell by
reason of a foreseeable specific contingency or any anticipated change
in the market value of the Common Stock, or in the condition of the
Corporation or that of the industry in which the business of the
Corporation is engaged or in connection with a contemplated
liquidation, or settlement of any loan obtained by the Purchaser for
the acquisition of the Common Stock, and for which the Common Stock may
be pledged as a security or as donations to religious or charitable
institutions for the purpose of securing a deduction on an income tax
return, would, in fact, constitute a purchase with an intention
inconsistent with the Purchaser's representations to the Corporation
and the Commission would then regard such purchase as a purchase for
which the exemption from registration under the Act relied upon by the
Corporation in connection herewith is not available.
(i) The funds provided for the Purchaser's investment in the
Common Stock are either the separate property of the Purchaser,
community property over which the Purchaser has the right of control,
or are funds as to which the Purchaser otherwise has the sole right of
management.
(j) If the Purchaser is a partnership, corporation, trust or
other entity: (i) the Purchaser has enclosed with this Subscription
Agreement evidence of the authority of the individual executing this
Subscription Agreement to act on its behalf (e.g., if a trust, a
certified copy of the trust agreement; if a corporation, a certified
corporate resolution authorizing the signature and a certified copy of
the articles of incorporation; or if a partnership, a certified copy of
the partnership agreement); (ii) the Purchaser was not organized or
reorganized for the specific purposes of acquiring the Common Stock;
(iii) the Purchaser has total assets in excess of $5,000,000 or each of
the equity owners of the Purchaser is an "accredited investor" as
defined in Rule 501(a) of Regulation D under the Act; (iv) the
individual executing this Subscription Agreement has the full power and
authority to execute this Subscription Agreement on behalf of such
entity and to make the representations and warranties made herein on
its behalf; and (v) an investment in the Common Stock described herein
has been affirmatively authorized, if required, by the governing board
of such entity and is not prohibited by the governing documents of the
entity.
(k) The following address is the Purchaser's principal
business address:
000 Xxxx 00xx Xxxxxx
Xxxxxxxxxxx, XX 00000
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(l) The Purchaser has received no representation or warranty
from any person regarding the Corporation or its business or prospects,
or the Common Stock; and the Purchaser acknowledges that the ability of
the Corporation to achieve its business objective is uncertain.
(m) The Purchaser is a bona fide resident and domiciliary, not
a transient or temporary resident, of the State of Minnesota.
(n) The Purchaser has made such investigation and examination
of the affairs of the Corporation and has obtained such information
relating thereto as he or she deems necessary to verify the accuracy of
the information furnished to him or her.
(o) Unless the Purchaser has notified the Corporation to the
contrary in writing, he or she acknowledges that he or she has not
relied upon the advice of a "purchaser representative" (as defined in
Regulation D of the Securities and Exchange Commission) in evaluating
the risks and merits of this investment.
(p) The Purchaser understands that the Corporation is relying
upon the truth and accuracy of these representations and warranties.
5. The Purchaser acknowledges that he or she understands the meaning
and legal consequences of the representations and warranties contained in
Section 4 hereof, and he or she hereby agrees to protect, defend, indemnify and
hold harmless the Corporation and its officers, directors and agents, from and
against any and all loss, damage or liability due to or arising out of a breach
of any representation of warranty of the Purchaser. Notwithstanding any of the
representations, warranties, acknowledgments or agreements made herein by the
Purchaser, the Purchaser does not either thereby or in any other manner waive
any rights granted to or her him under Federal or state securities laws.
6. It is understood that this subscription is not binding upon the
Corporation until the Corporation accepts it, which acceptance is at the sole
discretion of the Corporation, to be evidenced by execution of this Subscription
Agreement where indicated by an executive officer of the Corporation.
7. The Subscription Agreement is not subject to termination or
cancellation by the subscriber except as set forth below:
TO RESIDENTS OF FLORIDA: THE SHARES OF COMMON STOCK OFFERED HEREIN HAVE
NOT BEEN REGISTERED WITH THE FLORIDA DIVISION OF SECURITIES. PURSUANT TO FLORIDA
STATUTES, SECTION 517.061(11) (A) (5), INVESTORS MAY ELECT, WITHIN THREE (3)
BUSINESS DAYS AFTER DELIVERY OF THEIR SUBSCRIPTION AGREEMENT AND THE PURCHASE
PRICE FOR THE SHARES, TO WITHDRAW THEIR SUBSCRIPTION AND RECEIVE A FULL REFUND
(WITHOUT INTEREST) OF SUCH PURCHASE PRICE. THIS WITHDRAWAL WILL BE WITHOUT ANY
FURTHER LIABILITY TO ANY PERSON. TO ACCOMPLISH SUCH WITHDRAWAL, AN INVESTOR
SHOULD SEND A LETTER OR TELEGRAM TO THE
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CORPORATION, INDICATING THE INTENTION TO WITHDRAW, POSTMARKED PRIOR TO THE END
OF THE THIRD BUSINESS DAY AFTER DELIVERY OF FUNDS TO THE CORPORATION, RETURN
RECEIPT REQUESTED, TO ENSURE THAT IT IS RECEIVED AND TO EVIDENCE THE TIME WHEN
IT IS MAILED. ANY ORAL REQUESTS FOR RESCISSION SHOULD BE ACCOMPANIED BY A
REQUEST FOR WRITTEN CONFIRMATION THAT THE ORAL REQUEST WAS RECEIVED ON A TIMELY
BASIS.
8. The Corporation may accept or reject a subscription in whole or part
for any reason after receipt of a properly executed Subscription Agreement,
Offeree Questionnaire and a check representing full payment for the Shares
subscribed. A Subscription Agreement will be considered accepted by the
Corporation only after it has been signed by an authorized officer of the
Corporation. If the Corporation refuses a subscription, the Corporation will
promptly refund the subscription payment without interest, promptly after such
rejection, along with notice thereof.
9. The Purchaser understands and agrees that any certificate evidencing
the Common Stock shall be stamped or otherwise imprinted with a legend in
substantially the following form:
RESTRICTED SECURITIES
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR
INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR
DISTRIBUTION THEREOF. NO SALE OF THESE SECURITIES OR DISPOSITION MAY BE
EFFECTED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR
AN OPINION OF COUNSEL SATISFACTORY TO THE CORPORATION THAT SUCH
REGISTRATION IS NOT REQUIRED UNDER THE SECURITIES ACT OF 1933 AND
APPLICABLE STATES' SECURITIES LAWS.
The Purchaser further acknowledges that: (i) if the Common Stock
described herein becomes publicly traded, any necessary stop transfer orders
will be placed upon the certificates for the Common Stock in accordance with the
Act, and (ii) the Corporation is under no obligation to aid the Purchaser in
obtaining any exemption from the registration requirements of the Act or any
jurisdiction.
10. In no event will the Purchaser sell or otherwise transfer any of
the securities described herein other than in accordance with the terms thereof
and applicable law.
11. All information which the Purchaser has provided to the Corporation
concerning the Purchaser, the Purchaser's financial position and the Purchaser's
knowledge of financial and business matters is correct and complete as of the
date hereof, and if there should be any change in such information prior to the
issuance of the Common Stock to the Purchaser, the Purchaser will immediately
provide the Corporation with such new information. The Purchaser further
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agrees, if required by the Corporation or its authorized representative, to
provide bank references, tax returns or other confirming information concerning
the Purchaser's financial position as may be reasonably requested by the
Corporation.
12. Prior to the offer to sell the Common Stock to the Purchaser, the
Purchaser had a preexisting personal or business relationship with the
Corporation or at least one of its officers, directors or controlling persons
evincing trust between the Purchaser and such other person.
13. The Purchaser acknowledges that the Corporation and other parties
will rely upon the representations made herein to qualify the issuance of the
Common Stock for the registration exemptions afforded by the Act and Regulation
D, and any similar exemptions afforded by the laws of applicable states. The
Purchaser agrees to provide such other information and assistance as may be
necessary to comply with all applicable Federal and state securities
registration requirements or exemptions thereto for the issuance of the Common
Stock, or otherwise as may be reasonably necessary for compliance with any and
all laws and ordinances to which the Corporation is subject.
14. Registration Rights.
(a) Demand Registration. In case the Corporation shall receive
from the Purchaser a written request that the Corporation effect a registration
under the Securities Act with respect to not less than all of the shares of
Common Stock subscribed to herein, the Corporation shall as soon as practicable,
but in any event within 60 days, file and effect such registration (including,
without limitation, appropriate qualification under applicable blue sky or other
state securities laws and appropriate compliance with applicable regulations
issued under the Securities Act and any other governmental requirements or
regulations) as would permit or facilitate the sale and distribution of all such
shares of Common Stock. The Corporation shall not be required to effect more
than one (1) registration under this Section 14. In addition, during any
twenty-four month period, the Corporation shall have the right to delay on one
occasion any registration statement filed pursuant to this Section 14 for one
(1) period not in excess of thirty (30) days.
(b) Piggy Back Registration. If at any time or from time to
time the Corporation shall determine to register any of its securities, either
for its own account or the account of a security holder or holders, other than
(i) a registration relating solely to employee benefit plans or (ii) a
registration relating solely to a Commission Rule 145 transaction, the
Corporation will:
(i) promptly give to the Purchaser written notice
thereof; and
(ii) include in such registration (and any related
qualification under blue sky laws or other compliance), and in any underwriting
involved therein, all the Common Stock specified in a written request or
requests, made within 20 days after receipt of such written notice from the
Corporation, by the Purchaser.
(c) Underwriting. If the registration of which the Corporation
gives notice is for a registered public offering involving an underwriting, the
Corporation shall so advise the Purchaser. In such event, the right of the
Purchaser to registration pursuant to this section shall
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be conditioned upon the Purchaser's participation in such underwriting and the
inclusion of the Purchaser's Common Stock in the underwriting to the extent
provided herein. The Purchaser shall (together with the Corporation and any
other shareholders distributing their securities through such underwriting)
enter into an underwriting agreement in customary form with the managing
underwriter selected for such underwriting by the Corporation. Notwithstanding
any other provision of this section, if the managing underwriter determines that
marketing factors require a limitation of the number of shares to be
underwritten, the managing underwriter may limit the Common Stock to be included
in such registration. The Corporation shall so advise the Purchaser and the
number of shares of Common Stock that may be included in the registration and
underwriting shall reduced accordingly. If the Purchaser disapproves of the
terms of any such underwriting, he may elect to withdraw therefrom by written
notice to the Corporation and the managing underwriter. Any securities excluded
or withdrawn from such underwriting shall be withdrawn from such registration,
and shall not be transferred in a public distribution prior to 90 days after the
effective date of the registration statement relating thereto, or such other
shorter period of time as the underwriters may require. The Corporation may
include shares of Common Stock held by shareholders other than the Purchaser in
a registration statement pursuant to this section if, and to the extent that,
the amount of Common Stock otherwise includible in such registration statement
by the Purchaser would not thereby be diminished.
(d) All registration expenses incurred in connection with
registrations pursuant to this section shall be borne by the Corporation.
(e) The Corporation shall have the sole and exclusive right to
utilize and select the underwriters of any public offering of shares of the
Common Stock, including any public offering conducted pursuant to the
registration rights set forth above. The use of underwriters in any registration
right set forth above is, at the sole discretion of the Corporation, subject to
the Corporation's ability to engage underwriters under terms and conditions
deemed reasonable by the Corporation.
(f) The Corporation shall not be required to continue a
registration statement if such shares of Common Stock of Purchaser are eligible
to be sold under Rule 144 of the Securities Act, or otherwise eligible for sale
to the public without registration.
(g) The Corporation shall have the right to suspend or delay
the effectiveness of any registration statement upon the advice of counsel,
where such suspension or delay is required to allow the Corporation to maintain
compliance with all securities laws.
(h) The Purchaser agrees to cooperate with the Corporation in
all respects in connection with registration of the Common Stock, including
timely supplying all information and executing and returning all documents
requested by the Corporation and its managing underwriter and which are
customary in transactions of this type.
(i) In the event of an underwritten offering, the Purchaser
agrees to accept the terms of the underwriting as agreed upon between the
Corporation and its underwriters so long as they are reasonable and customary.
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(j) The Corporation shall have the right to defer the filing
of any registration statement or suspend the effectiveness of such registration
statement or reduce the number of shares of the Purchaser's Common Stock
registered in the registration statement if the Board of Directors of the
Corporation determines in good faith that it would be seriously detrimental to
the Corporation and its stockholders for such registration statement to be filed
or utilized in a transaction.
15. This agreement shall not be assignable by any party without the
written consent of the other party; contains the entire agreement between the
parties; cannot be modified except in writing signed by all parties hereto;
shall be binding upon the parties, their heirs, legal representatives,
successors and assigns; can be specifically enforced; and shall be governed by
Florida law.
IN WITNESS WHEREOF, the undersigned has executed this Subscription
Agreement on the 11th day of June, 1999.
"PURCHASER"
J.K.K. HOLDINGS, LLP
By: /s/ Xxxxxxxx X. Xxxx
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Xxxxxxxx X. Xxxx
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Tax Identification or
Social Security Number
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Address
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City, State and Zip Code
In consideration of and in reliance upon the foregoing, the
subscription and purchase described herein is hereby accepted this 11th of June,
1999.
VISION TWENTY-ONE, INC.
By: /s/ Xxxxxxxx X. Xxxxxxxx
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Xxxxxxxx Xxxxxxxx, Chairman,
President and CEO
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