EXHIBIT 10.6
SUSCRIPTION AGREEMENT
FOR
NOVA OIL, INC.
1. STOCK SUBSCRIPTION: The undersigned, _________________________ , a
resident of _________________________ ("Subscriber") hereby subscribes
for ______________________________ shares of Common Stock, $0.001 par
value, ("Common Stock"), of NOVA OIL, INC., a Nevada Corporation
("Company") for and in consideration of $_________________________.
Such Subscription is subject to the following terms and conditions:
a. The certificate(s) representing the Securities delivered
pursuant to this Subscription bear a legend in the following
form:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 ("ACT"), AS
AMENDED, OR ANY OTHER APPLICABLE FEDERAL OR STATE SECURITIES
ACTS; AND ARE RESTRICTED SECURITIES AS DEFINED BY RULE 144 OF
THE ACT. THE SECURITIES MAY NOT BE TRANSFERRED, SOLD OR
OTHERWISE DISPOSED OF UNLESS (1) A REGISTRATION STATEMENT WITH
RESPECT TO THE SECURITIES SHALL BE EFFECTIVE UNDER THE ACT OR
ANY OTHER FEDERAL OR STATE SECURITIES ACTS OR AN EXEMPTION
FROM REGISTRATION REQUIREMENTS UNDER THE ACT IS EFFECTIVE, AND
(2) THE COMPANY SHALL HAVE RECEIVED AN OPINION OF COUNSEL FOR
THE COMPANY THAT NO VIOLATIONS OF ANY SECURITIES ACTS WILL BE
INVOLVED IN ANY TRANSFER."
b. If the Securities represented by this certificate have been
held for a period of at least one (1) year and if Rule 144 of
the Securities Act of 1933, as amended ("Act"), is applicable
(there being no representations by the Company that Rule 144
is applicable), then the undersigned may make sales of the
Securities only under the terms and conditions prescribed by
Rule 144 of the Act or Exemptions therefrom.
2. REPRESENTATIONS AND WARRANTIES: Subscriber hereby represents and
warrants to NOVA OIL, INC.:
a. Subscriber understands that NOVA OIL, INC. SECURITIES HAVE NOT
BEEN APPROVED OR DISAPPROVED BY THE UNITED STATES SECURITIES
AND EXCHANGE COMMISSION, THE STATE OF WASHINGTON, THE STATE OF
NEVADA, OR ANY OTHER STATE SECURITIES AGENCIES.
b. Subscriber is not an underwriter and acquired NOVA OIL, INC.
Securities solely for investment for his own account and not
with a view to, or for, resale in connection with any
distribution of securities within the meaning of the Federal
Securities Acts, the Nevada State Securities Act, the
Washington Securities Act, or any other applicable State
Securities Acts; and is not being purchased with a view to or
for the resale, distribution, subdivision or fractionalization
thereof; and the undersigned has no contract, undertaking,
understanding, agreement, or arrangement, formal or informal,
with any person to sell, transfer, or pledge to any person the
securities for which it hereby subscribes, or any part
thereof; and it understands that the legal consequences of the
foregoing representations and warranties to mean that it must
bear the economic risk of the investment for an indefinite
period of time because the securities have not been registered
under the Act, and, therefore, cannot be sold unless they are
subsequently registered under the Act
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(which the Company is not obligated to do) or an exemption
from such registration is available.
c. Subscriber understands the speculative nature and risks of
investments associated with NOVA OIL, INC., and confirms that
the Securities would be suitable and consistent with his
investment program and that his financial position enables
Subscriber to bear the risks of this investment; and that
there may not be any public market for the securities for
herein. SUCH RISKS INCLUDE, BUT ARE NOT LIMITED TO: (1) THERE
IS NO GUARANTEE THE COMPANY IS ABLE TO SUCCESSFULLY UNDERTAKE
EXPLORATION AND DEVELOPMENT OF ITS NATURAL RESOURCE
PROPERTIES; (2) ALL OF THE RISKS INHERENT IN THE EXPLORATION
AND DEVELOPMENT OF OIL AND NATURAL GAS XXXXX; (3) THE COMPANY
IS UNDERCAPITALIZED AND FACES ALL OF THE RISKS INHERENT IN
OBTAINING ADDITIONAL FUNDING; (4) THERE IS NO PUBLIC MARKET
FOR THE COMMON STOCK OF THE COMPANY; AND, (5) THERE ARE
SIGNIFICANT RISKS OF THEIR INVESTMENT, INCLUDING THOSE
SUMMARIZED UNDER "RISK FACTORS" AND IN OTHER PORTIONS OF THE
PRIVATE PLACEMENT MEMORANDUM.
d. The Securities subscribed for herein may not be transferred,
encumbered, sold, hypothecated, or otherwise disposed of to
any person, without the express prior written consent of NOVA
OIL, INC., and the prior opinion of counsel for NOVA OIL,
INC., that such disposition will not violate Federal and/or
State Securities Acts. Disposition shall include, but is not
limited to acts of selling, assigning, transferring, pledging,
encumbering, hypothecating, giving, and any form of conveying,
whether voluntary or not.
e. NOVA OIL, INC. is under no obligation to register or seek an
exemption under any Federal and/or State Securities Acts for
any Securities of NOVA OIL, INC., or to cause or permit such
Securities to be transferred in the absence of any such
registration or exemption and that Subscriber herein must hold
such Securities indefinitely unless such Securities is
subsequently registered under Federal and/or State Securities
Acts or an exemption from registration is available.
f. At the time of subscription, Subscriber reviewed the economic
consequences of the purchase of the Securities from it's
attorney and/or other financial advisor, was afforded access
to the books and records of the Company, conducted an
independent investigation of the business of the Company, and
was fully familiar with the financial affairs of the Company.
Subscriber consulted with his counsel with respect to the Act
and applicable federal and state securities laws. Company has
not provided Subscriber with any representations, statements,
or warranties as to the SECURITIES.
g. Subscriber had the opportunity to ask questions of the Company
and receive additional information from the Company to the
extent that the Company possessed such information, or could
acquire it without unreasonable effort or expense, necessary
to evaluate the merits and risks of any investment in NOVA
OIL, INC.; provided that nothing herein shall be deemed to be
an acknowledgement of the accuracy or completeness of such
responses.
h. Subscriber confirms that he is able (i) to bear the economic
risk of the investment, (ii) to hold the Securities for an
indefinite period of time, and (iii) to afford a complete loss
of its investment; and represents that he has adequate means
of providing for his current needs and possible personal
contingencies, and that he has no need for liquidity in this
investment; (iv) this investment is suitable for Subscriber
based upon his investment holdings and financial situation and
needs, and this investment does not exceed ten percent of
Subscriber's net worth; (v) Subscriber has by reason of his
business or
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financial experience could be reasonably assumed to have the
capacity to protect his own Securities in connection with this
transaction.
i. Subscriber confirms that the undersigned is an "accredited
investor" within the meaning of SEC Regulation "D" or the
undersigned, along or together with its purchaser
representative(s) has such knowledge and experience in
financial and business matters that he, or Subscriber and such
representative(s) together, are capable of evaluating the
merits and risks of an investment in NOVA OIL, INC. and of
making an informed investment decision.
3. STATUS OF SUBSCRIBER:
[ ] I am NOT a member of, or an associate or affiliate of a member
of the National Association of Securities Dealers; and have
not, for a period of 12 months prior to the date of this
Subscription agreement, been affiliated or associated with any
broker/dealer, company, firm, organization, or other entity
which is a member of the National Association of Securities
Dealer, Inc.
[ ] I am a member of or an associate or affiliate of a member of
the National Association of Securities Dealers. Attached is a
copy of an agreement signed by the principal and compliance
officer of the firm with which I am affiliated agreeing to my
participation in this investment.
4. ARBITRATION: Any controversy arising out of, connected to, or relating
to any matters herein of the transactions between Subscriber and
Company (including for purposes of arbitration, officers, directors,
employees, controlling persons, affiliates, professional advisors,
attorneys, agents, or promoters of the Company), on behalf of the
undersigned, or this Agreement, or the breach thereof, including, but
not limited to any claims of violations of Federal and/or State
Securities Acts, Banking Statutes, Consumer Protection Statutes,
Federal and/or State anti-Racketeering (e.g. RICO) claims as well as
any common law claims and any State Law claims of fraud, negligence,
negligent misrepresentations, and/or conversion shall be settled by
arbitration; and in accordance with this paragraph and judgment on the
arbitrator's award may be entered in any court having jurisdiction
thereof in accordance with the provisions of Nevada law. In the event
of such a dispute, each party to the conflict shall select an
arbitrator, both of whom shall then select a third arbitrator which
shall constitute the three person arbitration board. The decision of a
majority of the board of arbitrators, who shall render their decision
within thirty (30) days of appointment of the final arbitrator, shall
be binding upon the parties. Venue for any action shall lie in the City
of Spokane, State of Washington.
5. MISCELLANEOUS: This Subscription Agreement shall be binding upon the
parties hereto, their heirs, executors, successors, and legal
representatives. The laws of the State of Nevada shall govern the
rights of the parties as to this Agreement.
6. INDEMNIFICATION: Subscriber acknowledges that he understands the
meaning and legal consequences of the representations and warranties
contained herein, and he hereby agrees to indemnify and hold harmless
the Company and any other person or entity relying upon such
information thereof from and against any and all loss, damage or
liability due to or arising out of a breach of any representation,
warranty, or acknowledgement of Subscriber contained in this Agreement.
7. DESIGNATION OF OWNERSHIP: Subscriber wishes to own Common Shares as
follows:
(a)______ Separate or individual property
(b)______ Husband and wife as community property (Community
property state only.)
(c)______ Joint tenants with right of survivorship (Both
parties must sign.)
(d)______ Tenants in common (Both parties must sign.)
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(e)______ Trust (include name of trust and name of trustee.)
(f)______ Other (indicated):___________________________________
(g)______ Corporation (include name of President and
Secretary.)
(h)______ Limited Liability Company (include name of Manager
and all Members.)
SUBSCRIBER HEREBY DECLARES AND AFFIRMS THAT HE HAS READ THE WITHIN AND FOREGOING
SUBSCRIPTION AGREEMENT, IS FAMILIAR WITH THE CONTENTS THEREOF AND AGREES TO
ABIDE BY THE TERMS AND CONDITIONS THEREIN SET FORTH, AND KNOWS THE STATEMENTS
THEREIN TO BE TRUE AND CORRECT.
IN WITNESS WHEREOF, Subscriber executed this Agreement this ___ day of
____________________, _______, at _______________________.
SUBSCRIBER:
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(Signature)
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(Signature of Spouse, Joint Tenant, or Tenant in Common)
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(Address)
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(Telephone Number)
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(Social Security Number)
FOR ENTITY SUBSCRIBERS:
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Name of Entity, if any
By:*
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Title:
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By:*
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*By the foregoing signature, I hereby certify to NOVA OIL, INC. that I am duly
empowered and authorized to execute the foregoing document as well as to provide
the foregoing information.
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