SUBSCRIPTION AGREEMENT
Xxxxxx Tree Construction, Inc.
0000 Xxxxxxxx Xxxxxxxx Xxxx
Xxxxxxxx, XX 00000
Ladies and Gentlemen:
It is understood that the securities described below are being offered
for sale (the "Offering") pursuant to an exemption from the registration
provisions of the Securities Act of 1933, as amended (the "Act") and in Section
4(2) of the Act promulgated thereunder.
1. SUBSCRIPTION. The undersigned (hereinafter referred to as the
"Subscriber") hereby subscribes for the number of shares, set forth on the
signature page hereof, of Xxxxxx Tree Construction, Inc., a Nevada corporation
(the "Company"), of the Company's $.001 par value common stock (the "Shares").
Payment in the amount of $275,000 will be made in payment of the purchase price
for the Shares subscribed for hereby, by wire transfer to the Company's bank
account, or by other means that the Company may direct. Subscriber understands
that, if for any reason the Company rejects the subscription, Subscriber will
receive a return of his subscription without interest or deduction. Subscriber
further understands that the funds in escrow will not bear interest, will be
held for the benefit of the Subscriber until released to the Company and will
not be subject to the creditors of the Company or the expenses of the Offering.
During the period such funds are held in escrow, Subscriber will not be entitled
to a refund of his subscription.
2. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE SUBSCRIBER
2.1 (a) The Subscriber is an Accredited Investor as that term is
defined in Section 2(15) of the securities Act of 1933 (the "Act"), and Rule 501
of Regulation D promulgated thereunder. SPECIFICALLY, THE SUBSCRIBER IS (CHECK
APPROPRIATE ITEMS):
(i) A bank defined in Section 3(a)(2) of the Act, or a savings and loan
association or other institution as defined in Section 3(a)(5)(A) of the Act,
whether acting in its individual or fiduciary capacity; a broker or dealer
registered pursuant to Section 15 of the Securities Exchange Act of 1934; an
insurance company as defined in Section 2(13) of the Act; an investment company
registered under the Investment Company Act of 1940 (the "Investment Company
Act") or a business development company as defined in Section 2(a)(48) of the
Investment Company Act; a Small Business Investment Company licensed by the U.S.
Small Business Administration under Section 301(3) or (d) of the Small Business
Investment Act of 1958; a plan established and maintained by a state, its
political subdivisions or any agency or instrumentality of a state or its
political subdivisions for the benefit of its employees, if such plan has total
assets greater than $5,000,000; an employee benefit plan within the meaning of
the Employee Retirement Income Security Act of 1974 ("ERISA"), if the investment
decision is made by a plan fiduciary, as defined in Section 3(21) of ERISA,
which is either a bank, savings and loan association, insurance company, or a
registered investment advisor, or if the employee benefit plan has total assets
greater than $5,000,000 or, if a self-directed plan, with
investment decisions made solely by persons that are accredited investors.
(ii) A private business development company as defined in Section
202(a)(22) of the Investment Adviser Act of 1940.
(iii) An organization described in Section 501(c)(3) of the Internal
Revenue Code, corporation, Massachusetts or similar business trust, or
partnership, not formed for the specific purpose of acquiring the securities
offered, with total assets greater than $5 million.
(iv) a natural person whose individual net worth, or joint net worth
with that person's spouse, at the time of his or her purchase exceeds $1
million. (California and Massachusetts residents: please see Section 2(b) below,
if applicable.)
(v) A natural person who had an individual income greater than $200,000
in each of the two most recent years or joint income with that person's spouse
greater than $300,000 in each of those years and has a reasonable expectation of
reaching the same income level in the current year. (California and
Massachusetts residents: please see Section 2(b) below, if applicable.)
(vi) A trust, with total assets greater than $5 million not formed for
the specific purpose of acquiring the securities offered, whose purchase is
directed by a sophisticated person as described in Rule 506(b)(2)(ii) (i.e., a
person who has such knowledge and experience in financial and business matters
that he is capable of evaluating the merits and risks of the prospective
investment.)
(vii) an entity in which all of the equity owners are accredited
investors. (If this alternative is checked, the Subscriber must identify each
equity owner and provide statements signed by each demonstrating how each is
qualified as an accredited investor.)
(b) For California and Massachusetts individuals: If the Subscriber is
a California resident, its investment in the Company will not exceed 10% of its
net worth (or joint net worth with his spouse). If the Subscriber is a
Massachusetts resident, its investment in the Company will not exceed 25% of its
joint net worth with his spouse (exclusive of principal residence and its
furnishings).
(c) If a natural person, the Subscriber is: a bona fide resident of the
state contained in the address set forth on the signature page of this Agreement
as the Subscriber's home address; at least 21 years of age; and legally
competent to execute this Subscription Agreement. If an entity, the Subscriber
is duly authorized to execute this Agreement and this Agreement constitutes the
legal, valid and binding obligation of the Subscriber enforceable against the
Subscriber according to its terms.
(d) The Subscriber is familiar with this Subscription Agreement and the
Company, its business, plans and financial condition, the terms of the offering
and any other matters relating to
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the offering. The Subscriber has received all materials which have been
requested by the Subscriber; has had a reasonable opportunity to ask questions
of the Company and its representatives; and the Company has answered all
inquiries that the Subscriber or the Subscriber's representatives have put to
it. The Subscriber has had access to all additional information necessary to
verify the accuracy of the information set forth in this Agreement and any other
materials furnished herewith, and has taken all the steps necessary to evaluate
the merits and risks of an investment as proposed hereunder.
(e) The Subscriber has such knowledge and experience in finance,
securities, investments and other business matters so as to be able to protect
the interests of the Subscriber concerning this transaction, and the
Subscriber's investment in the Company hereunder is not material when compared
to the Subscriber's total capacity. The Subscriber understands an investment in
the Company is of a speculative nature involving a high degree of risk.
(f) The Subscriber understands the various risks of an investment in
the Company as proposed herein and can afford to bear such risks, including,
without limitation, the risks of losing its entire investment.
(g) The Subscriber acknowledges that a limited market for the Shares
presently exists, and that the Subscriber may find it impossible to liquidate
the investment at a time when it may be desirable to do so, or at any other
time.
(h) The Subscriber is aware that the Shares have not been registered
under the Act, that the Shares will be issued on the basis of the statutory
exemption provided by Section 4(2) of the Act relating to transactions by an
issuer not involving any public offering and under similar exemptions under
certain state securities laws, that this transaction has not been reviewed by,
passed on or submitted to any Federal or state agency or self-regulatory
organization where an exemption is being relied upon, and that the Company's
reliance thereon is based in part upon the representations made by the
Subscriber in this Agreement. The Subscriber acknowledges that it has been
informed by the Company, or is otherwise familiar with, the nature of the
limitations imposed by the Act and the rules and regulations thereunder on the
transfer of securities. In particular, the Subscriber agrees that no sale,
assignment or transfer of any Shares will be valid or effective, and the Company
shall not be required to give any effect to such sale, assignment or transfer,
unless (i) such sale, assignment or transfer is registered under the Act, it
being understood that the Shares are not currently registered for sale and that
the Company has no obligation or intention to so register the Shares, or (ii)
such Shares are sold, assigned or transferred in accordance with all the
requirements and limitations of Rule 144 under the Act, it being understood that
Rule 144 is not available at the present time for the sale of the Shares, or
(iii) such sale, assignment or transfer is otherwise exempt from the
registration under the Act. The Subscriber further understands that an opinion
of counsel and other documents may be required to transfer the Shares. The
Subscriber acknowledges that the certificates evidencing the Shares will all
bear the following, or a substantially similar legend, or such other legend as
may appear on the forms of the Shares, and such other legends as may be required
by state blue sky laws:
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"The securities represented by this certificate have not been
registered under the Securities Act of 1933 (the "Act"), or any state
securities laws and neither such securities nor any interest therein
may be offered, sold, pledged, assigned or otherwise transferred unless
(1) a registration statement with respect thereto is effective under
the Act and any applicable state securities laws, or (2) the Company
receives an opinion of counsel to the holder of such securities, which
counsel and opinion are reasonably satisfactory to the Company, that
such securities may be offered, sold, pledged, assigned or transferred
in the manner contemplated without an effective registration statement
under the Act or applicable state securities laws."
(i) The Subscriber is acquiring the Shares for the Subscriber's own
account for investment and not with a view to the sale or distribution thereof
or the granting of any participation therein, and has no present intention of
distributing or selling to others any of such interest or granting
participations therein.
(j) The Subscriber is not subscribing for the Shares because of or
following any advertisement, article, notice or other communication published in
any newspaper, magazine or similar media or broadcast over television or radio,
or presented at any seminar or meeting, or any solicitation or a subscription by
a person other than a representative of the Company.
(k) The Subscriber is not relying on the Company with respect to the
tax and other economic considerations of an investment in the Shares.
(l) The Shares have not been registered under the Act and are being
sold in reliance upon the exemption contained in Section 4(2) of the Act.
3. MISCELLANEOUS
3.1 All notices or other communications given or made hereunder shall
be in writing and shall be delivered by hand or mailed by registered or
certified mail, return receipt requested, postage prepaid, to the undersigned,
at the respective address set forth herein, and to the Company at the addresses
set forth above.
3.2 This Agreement shall be governed by and construed in accordance
with the laws of the state of Nevada applicable to contracts made and wholly
performed in that state.
3.3. This Agreement constitutes the entire agreement among the parties
hereto with respect to the subject matter hereof and may be amended only by a
writing executed by the party to be bound thereby.
3.4 This Subscription Agreement is not transferable or assignable by
Subscriber.
3.5 All references in this Agreement to the "Subscriber" shall include
all parties
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(other than the Company) who execute this Agreement. If the Subscriber is a
corporation, partnership, trust or two or more individuals purchasing jointly,
note the specific instructions for the Certificate of Corporate, Partnership,
Trust and Joint Purchases at page 9 hereof. Please date and sign the certificate
at page 10 hereof.
3.6 This Agreement shall be governed by and construed in accordance
with the laws of the State of Nevada. Each of the parties consents to the
jurisdiction of the federal courts whose district encompass the state courts of
the State of Nevada in connection with any dispute arising under this Agreement
and hereby waives to the maximum extent permitted by law, any objection,
including any objection based on forum non-conveniens, to the bringing of any
such proceeding in such jurisdiction.
4. ACCEPTANCE OF SUBSCRIPTION. It is understood that this subscription
is not binding upon the Company until the Company accepts it, and that the
Company has the right to accept or reject this subscription in whole or in part
in its sole and complete discretion. If this subscription is rejected in whole,
the Company shall return the Payment to Subscriber, without interest, and the
Company and Subscriber shall have no further obligation to each other hereunder.
In the event of a partial rejection of this subscription, a pro rated amount of
the Payment will be returned to Subscriber, without interest.
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IN WITNESS WHEREOF, this Agreement has been executed by the Subscriber
and by the Company on the respective dates set forth below.
NUMBER OF SHARES PRICE PER SHARE AMOUNT OF PURCHASE PRICE
1,100,000 $0.25 $275,000
------------------------------------ ---------------------------------------
Date Printed Name of Subscriber
By:
------------------------------------ ------------------------------------
Tax Identification No.
---------------------------------------
Signature of Authorized Signatory
------------------------------------ ---------------------------------------
Telephone No. Printed Name of Authorized Signatory
------------------------------------
Street Address of Subscriber
------------------------------------
City State Zip
Subscription Accepted by:
Xxxxxx Tree Construction, Inc.
By:
---------------------------------
Xxxxxx X. Xxxxx
Chairman, CEO & Director
Date:
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SPECIAL SUBSCRIPTION INSTRUCTIONS FOR CORPORATE,
PARTNERSHIP, TRUST, AND JOINT PURCHASERS
If the subscriber is a corporation, partnership, trust, or other entity
or joint purchaser, the following additional instructions must be followed.
INFORMATION ADDITIONAL TO THAT REQUESTED BELOW MAY ALSO BE REQUIRED BY THE
COMPANY IN SOME CASES.
I. Certificate. The subscriber must date and sign the Certificate
below, and, if requested by the Company, the subscriber may also be required to
provide an opinion of counsel to the same effect as this Certificate or a copy
of (a) the corporation's articles of incorporation, bylaws and authorizing
resolution, (b) the partnership agreement, or (c) the trust agreement, as
applicable.
II. Subscription Agreement
A. CORPORATIONS. An authorized officer of the corporation must
date, sign, and complete the Subscription Agreement with information
concerning the corporation. The officer should print the name of the
corporation above his signature, and print his name and office below
his signature.
B. PARTNERSHIPS. An authorized partner must date, sign, and
complete the Subscription Agreement with information concerning the
partnership. The partner should print the name of the partnership above
his signature, and print his name and the words "general partner" below
his signature.
C. TRUSTS. In the case of a trust, the authorized trustee should
date, sign, and complete the Subscription Agreement with information
concerning the trust. The trustee should print the name of the trust
above his signature, and print his name and the word "trustee" below
his signature. In addition, an authorized trustee should also provide
information requested in the Subscription Agreement as it pertains to
him as an individual.
D. JOINT OWNERSHIP. In all cases, each individual must date,
sign, and complete the Subscription Agreement. Joint investors must
state if they are purchasing the Shares as joint tenants with the right
of survivorship, tenants in common, or community property, and each
must execute the Subscription Agreement Signature Page.
CERTIFICATE FOR CORPORATE, PARTNERSHIP,
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TRUST, AND JOINT PURCHASERS
If the subscriber is a corporation, partnership, trust, joint
purchaser, or other entity, an authorized officer, partner, or trustee must
complete, date, and sign this Certificate.
CERTIFICATE
I hereby certify that:
a. The subscriber has been duly formed and is validly existing
and has full power and authority to invest in Xxxxxx Tree Construction,
Inc.
b. The Subscription Agreement has been duly and validly
authorized, executed, and delivered by the subscriber and, upon
acceptance by the Company, will constitute the valid, binding, and
enforceable obligation of the subscriber.
Dated: , 2002
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Name of corporation, partnership, trust
or joint purchases (please print)
-----------------------------------------
Signature and title of authorized officer,
partner, trustee, or joint purchaser
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