EXHIBIT 10.17
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SUBSCRIPTION AGREEMENT
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XXXXXXXX.XXX, INC.
XxXxxxxx.xxx, Inc.
000 Xxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, XX 00000
Ladies and Gentlemen:
1. PURCHASE. Subject to the terms and conditions hereof, the undersigned
agrees to purchase the number of Units set forth at the end of this Agreement,
at a purchase price of $.25 per unit. Each Unit shall consist of:
o One share of common stock of the Company, par value $0.001 per share
("Common Stock") of XxXxxxxx.xxx, Inc., a Delaware corporation (the
"Company"); and
o One three year warrant to purchase one share of Common Stock at an
exercise price of $.25 per share (the "Warrant," and together with the
Common Stock, the "Securities").
The undersigned hereby tenders the amount set forth at the end of this
Agreement in the form of a check payable to the order of the Company or a wire
transfer, in full payment of the purchase price for such Units.
2. CLOSING. The sum tendered herewith pursuant to Paragraph 1 will
promptly be remitted to the Company, or third parties for the account of the
Company, for its use. Promptly after such sum is remitted to the Company, the
Company will cause a certificate for each of the Common Stock and the Warrants
purchased hereunder by the undersigned to be issued in the name of and delivered
to the undersigned. THIS OFFERING WILL TERMINATE ON SEPTEMBER 14, 2001, HOWEVER,
THE COMPANY MAY EXTEND THE OFFERING FOR A PERIOD OF NOT MORE THAN 30 DAYS UPON
WRITTEN NOTICE TO ALL SUBSCRIBERS.
3. ACCEPTANCE OF AGREEMENT. This agreement shall be accepted by the
Company when it is signed on behalf of the Company and the subscription price
tendered concurrently herewith is transferred to or for the account of the
Company. The Company may refuse to accept any subscription, in whole or in part,
in its sole discretion. If the Company rejects a subscription, in whole or in
part, it will refund the purchase price for the rejected portion of the
subscription.
4. REPRESENTATIONS AND WARRANTIES OF THE UNDERSIGNED. The undersigned
hereby represents and warrants to the Company, its officers, directors, agents,
and employees as follows:
(a) That he(1) has adequate means of providing for his current needs
and personal contingencies, he has no need now, and anticipates no need in
the foreseeable future, to sell the common stock which he hereby agrees to
purchase, and he currently has sufficient financial liquidity to afford a
complete loss of his investment in the Company.
(b) That he has received and carefully reviewed descriptive memoranda
relating to the Company and any other materials relating thereto that he
has requested.
(c) That he has had an opportunity to ask questions of and receive
answers from the authorized representatives of the Company, and to review
any relevant documents and records concerning the business of the Company
and the terms and conditions of this investment, and that any such
questions have been answered to the full satisfaction of the undersigned.
(d) That no person or entity, other than the Company or its authorized
representatives, has offered the common stock to the undersigned.
(e) That he has such knowledge and experience in financial and
business matters that he is capable of evaluating the merits and risks of
an investment in the Company, or he and his financial and investment
advisors together have such knowledge and experience in financial and
business matters that they are capable of evaluating the merits and risks
of an investment in the Company.
(f) That the Units for which he hereby subscribes will be acquired for
his own account for investment and not with a view toward subdivision,
resale, or redistribution thereof in a manner prohibited under the
Securities Act of 1933, as amended (the "Act "), and he does not presently
have any reason to anticipate any change in his circumstances or other
particular occasion or event which would cause him to sell his Units or the
Securities. He has no contract, undertaking, agreement, understanding, or
arrangement with any person to sell, transfer, or pledge to any person any
part or all of the Units for which he hereby subscribes, or any interest
therein, or the Securities, and has no present plans to enter into the
same.
(g) That (i) it has been called to his attention in connection with
his investment in the Company that such investment is speculative in nature
and involves a high degree of risk, and (ii) he is aware that the Company
is in the start-up stage and thus has a limited operating history.
(h) That he understands that this subscription may be accepted or
rejected in whole or in part by the Company in its sole and absolute
discretion.
(i) That he understands that his subscription is irrevocable, except
that he shall have no obligations hereunder in the event that this
subscription is for any reason rejected or this offering is for any reason
cancelled.
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(1) Masculine pronouns are used solely for convenience of reference, and are
intended to have general application.
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(j) That he understands that there is no guarantee that the Company
will be able to sell any Units, and that there is no minimum number of
Units that the Company must sell in order to complete this offering.
(k) That he understands that no federal or state agency has passed
upon or made any recommendation or endorsement of an investment in the
Units or the Securities.
(l) That he would come within the following categories of "accredited
investor" under Rule 501(a) of Regulation D of the Securities and Exchange
Commission promulgated under the Securities Act of 1933 (Please check ALL
applicable spaces):
_____ (i) His or her net worth exceeds $1,000,000 (may include
spouse's net worth).
_____ (ii) His or her INDIVIDUAL income in each of the two immediately
previous years has been more than $200,000 and his or her
current year's income is reasonably expected to be more than
$200,000, OR his or her joint income with spouse in each of
the two immediately previous years has been more than
$300,000 and his or her current year's joint income is
reasonably expected to be more than $300,000.
_____ (iii) We are a trust with total assets of more than $5,000,000,
not formed for the specific purpose of acquiring the Units,
whose purchase is being directed by an investor who, either
alone or with his purchaser representative(s), has such
knowledge and experience in financial affairs and business
matters that he is capable of evaluating the merits and
risks of the prospective investments.
_____ (iv) We are an organization described in Section 501(c)(3) of the
Internal Revenue Code, a corporation, a Massachusetts or
similar business trust, or a partnership, not formed for the
specific purpose of acquiring the securities, with total
assets in excess of $5,000,000.
_____ (v) We are a corporation or partnership and each and every one
of our equity owners falls into at least one of the above
categories.
_____ (vi) None of the above.
(m) That he will notify the Company immediately, and in any event
prior to the date this agreement is accepted by the Company, if any event
occurs which would materially affect any of the above representations or
warranties.
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5. RELIANCE. The undersigned acknowledges that the Company and its
officers, directors, employees, and agents are relying on the truth and accuracy
of the foregoing representations and warranties in the offering of Units for
sale to the undersigned without having first registered the Units or the
Securities under the Act. All representations, warranties, and covenants
contained in this agreement shall survive the acceptance of this agreement and
the sale of Units in the Company. Notwithstanding the foregoing, however, no
representation, warranty, acknowledgment, or agreement made herein by the
undersigned shall in any manner be deemed to constitute a waiver of any rights
granted to him under federal or state securities laws.
6. CONSENT TO USE OF INFORMATION. The undersigned hereby consents to the
utilization by the Company, as necessary in connection with dealings with any
governmental and regulatory authorities, of any information supplied to the
Company by the undersigned or by his representatives in connection with the
offer and sale of the Units, and agrees to supply any additional information
reasonably requested by any such authority.
7. RESTRICTIONS ON TRANSFER OF UNITS.
(a) OPINION OF COUNSEL. The undersigned acknowledges that there are
restrictions on the transferability of the Units and the Securities. Since
the Units and the Securities are not registered under the Act or applicable
state securities laws, and since the undersigned has no right to require
that the Units or the Securities be so registered, the undersigned
acknowledges and agrees that he shall have no right at any time to sell,
assign, pledge, transfer, or otherwise dispose of or encumber the Units or
the Securities (except by will or by the laws of descent and distribution)
unless the Company shall first have been provided with an opinion of
counsel acceptable to the Company that such sale is exempt from such
registration under the Act and any applicable state securities laws.
(b) RESTRICTIVE LEGENDS. The undersigned acknowledges that each
certificate representing Units or the underlying securities will bear
restrictive legends which may refer to this Subscription Agreement and to
the restrictions on transfer referred to in this Paragraph 7.
8. NOTICE TO INVESTOR. Correspondence and notices to the undersigned
should be sent to the business residence address listed below until such time
as the undersigned shall notify the Company, in writing, of a different address
to which such correspondence and notices are to be sent. If neither space is
marked above, all correspondence will be sent to the undersigned's residence
address.
9. LOCK-UP PROVISIONS. In the event the Company files a registration
statement under the Securities Act of 1933 for a public offering of the
Company's Common Stock, $.001 par value (the "Common Stock "), and if in
connection therewith the Company has obtained lock-up agreements from all of its
then officers and directors not to sell any shares of Common Stock owned by them
for a specified period of time, then the undersigned shall be bound by the terms
of such agreements with respect to all shares of the Common Stock owned by the
undersigned, whether or not the undersigned has executed such an agreement. This
provision shall survive the termination of this agreement. This agreement shall
be construed as a "lock-up" agreement and may be delivered by the Company to any
underwriter retained in connection with the Company's initial public offering.
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IN WITNESS WHEREOF, the undersigned has executed this Agreement as of
____________, 2001.
____________________ X $.25 = $__________________________
UNITS BEING PURCHASED TOTAL PURCHASE PRICE
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Signature
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Business Position or Title Name (Typed or Printed)
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Name of Business United States
Social Security Number, if any
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Business Address Residence Address
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City, State or Province, City, State or Province,
County and Zip Code County and Zip Code
ACCEPTED AND AGREED TO:
XXXXXXXX.XXX, INC.
By:
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Dated:
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