Paradise Music & Entertainment, Inc.
SUBSCRIPTION AGREEMENT
Name of Subscriber: ______________________________
Dated: December ____, 1998
1. Subscription. The undersigned hereby subscribes for ______ shares of
Common Stock, $0.01 par value, of Paradise Music & Entertainment, Inc. (the
"Company") at a price of $1.00 per share for a total investment of $___________.
In satisfaction therefore, we have wired such amount to [an escrow account
maintained by The Xxxxxxxxx Group, Inc.] which account will be disbursed upon
the effective registration of the shares of Common Stock being subscribed for
hereunder.
2. Risk Factors. The undersigned understands and acknowledges that the
purchase of the Common Stock is a highly speculative investment that involves a
high degree of risk of loss by it of its entire investment in the Company due to
a number of significant risk factors including, but not limited to, the fact
that the Company is in the developmental stage and has a limited operating
history.
3. Representations, Warranties and Covenants of the Company. The Company
represents, warrants and covenants to the undersigned as follows:
(a) The Company is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware and has all requisite
power and authority to own, lease and operate its properties and to carry on its
business as now being conducted. The Company is not in violation of any of the
provisions of its Articles of Incorporation or By-Laws.
(b) The Company has full power and authority to execute and deliver this
Agreement and to consummate the transactions contemplated hereby. No other
proceedings on the part of the Company are necessary to authorize this Agreement
or to consummate the transactions contemplated hereby. This Agreement has been
duly and validly executed and delivered by the Company and constitutes the valid
and binding agreement of the Company, enforceable against the Company in
accordance with its terms.
(c) The Common Stock has been duly authorized and, when issued and
delivered against payment therefor as provided in this Agreement, will be
validly issued, fully paid and nonassessable. No holder of any of the Common
Stock will be subject to personal liability solely be reason of being such a
holder.
(d) The Company agrees to promptly file a registration statement on Form
S-3 with the Securities Exchange Commission ("Commission") to register the
shares of Common Stock represented by this subscription promptly after
subscriptions in the amount of $1,500,000 in the aggregate have been subscribed
for by investors, such as yourself. In the event that investors have not
subscribed for $1,500,000 in Common Stock in the aggregate by December 15, 1998,
the Company reserves the right to cancel your subscription and instruct the
escrow agent to return any monies that you have deposited therewith in
furtherance of your subscription. In the event that the shares of Common Stock
evidenced by this subscription have not been effectively registered (i.e., so as
to become freely trading and unrestricted)
by the 90th day after the S-3 registration statement has been filed with the
Commission, the Company agrees that you can cancel this subscription agreement,
the escrow agent will promptly return the proceeds of your subscription, with
interest, if any, and that you will have no further obligation to the Company.
4. Representations and Warranties of the Undersigned. The undersigned
represents and warrants to the Company as follows:
(a) The undersigned is an accredited investor as such term is defined in
Regulation D promulgated under the Securities Act of 1933, as amended (the
"Securities Act) and has been supplied with or has sufficient access to all
information, including financial statements and other financial information of
the Company including, its most recent 10-KSB for the fiscal year ended June 30,
1998 and 10-QSB for the quarter ended September 30, 1998, and has been afforded
with an opportunity to ask questions of and receive answers from any officer of
the Company concerning information which a reasonable investor would attach
significance in making investment decisions.
(b) The undersigned agrees that, prior to the effectiveness of an S-3
registration statement registering the shares of Common Stock being purchased
hereunder, a legend may be placed on any certificate or other document
evidencing the Common Stock stating that they have not been registered under the
Securities Act (and a stop transfer order may be placed with respect thereto)
and that the Common Stock are subject to other transfer restrictions as set
forth in the By Laws of the Company.
IN WITNESS WHEREOF, the undersigned has executed this Agreement as the
date first stated above.
SUBSCRIBER:
[NAME OF ENTITY MAKING INVESTMENT, IF RELEVENT]
------------------------------
Name:
Title:
This Subscription is accepted by Paradise Music & Entertainment, Inc. as of this
___ day of December, 1998.
PARADISE MUSIC & ENTERTAINMENT, INC.
By
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Name:
Title:
2
