FORM OF SECURITIES PURCHASE AGREEMENT
THIS
SECURITIES PURCHASE AGREEMENT (this
“Agreement”)
is
made as of _____________, 2007, by and among Sub-Urban
Brands, Inc. ,
a
Nevada corporation (the “ Company
”),
and
_________________________________________________ (including any subsequent
holder of the Note, as defined in herein), the “ Investor
”).
1.
Promissory
Note and Shares.
The
Investor hereby agrees to purchase from the Company an investment unit
consisting of an unsecured convertible promissory note (the “ Note
”),
in
substantially the form attached hereto as Exhibit
A ,
and
_________ shares of the Company’s common stock (the “ Shares
”).
The
Note shall have a principal balance of $__________ and shall be dated as of
the date hereof. The Note shall be due and payable
_________________________________ and shall accrue interest at ten percent
(10%)
per annum. The purchase price of the investment unit shall be $_________ (the
“Purchase Price”). The Company and the Investor agree that 100% of the Purchase
Price shall be allocated to the Note and no portion of the Purchase Price is
allocated to the Shares. As a result, the parties agree that the Shares are
being acquired at a discount to market in consideration of the purchase of
the
Note and based on, among other things, illiquidity of the Shares.
1.3.
Closing.
The
closing (the “Closing”)
of the
purchase and sale of the Note and Shares shall take place at the offices of
the
Company on __________________, 2007 (the “Closing Date”).
1.4.
Registration
Rights.
The
Company agrees to file a registration statement with the Securities and Exchange
Commission (the “SEC”) in order to register the Shares, together with any Bonus
Shares (as such term is defined below) (collectively, the “Registrable Shares”),
for resale and to cause such registration to be declared effective by the SEC
within seven (7) months of the Closing. In the event that the registration
statement is not declared effective by the SEC on or before the seven-month
anniversary of the Closing Date , the Company shall, at the first day of each
calendar month thereafter and continuing for so long as the Registrable Shares
are not registered, issue to the Investor ______ shares of common stock (the
“Bonus Shares”). Notwithstanding the foregoing, the Company will include the
Shares on its next Registration Statement filed with the SEC. The Investor
specifically acknowledges that the Company currently has an obligation to
register up to _______ shares of its common stock (together with additional
shares to be issued on a monthly basis if such registration is not effective
within seven months of the issuance of such shares) prior to or concurrently
with the registration of the Shares. Such shares were issued by the Company
on
__________________, 2007 in connection with the issuance of up to $_______
of
unsecured convertible promissory notes. The Investor specifically acknowledges
and agrees that the SEC may request that the number of shares in any
registration statements filed by the Company for selling shareholders be cut
back or registration delayed pursuant to the SEC’s interpretation of Rule 415 or
other rules and regulations promulgated under the Securities Act of 1933, as
amended. The Investor agrees that any such cut backs or delays in registration
shall not be a breach of the Company’s obligation to register the Registrable
Shares and shall not result in payment of Bonus Shares hereby.
2.
Representations
and Warranties of the Company.
In
connection with the transactions provided for herein, the Company hereby
represents, warrants, and covenants to the Investor as of the date hereof and
as
of the Closing (and any subsequent closing) that:
2.1.
Organization,
Good Standing, and Qualification.
The
Company is a corporation duly organized, validly existing, and in good standing
under the laws of the State of Nevada and has all requisite corporate power
and
authority to carry on its business as now conducted and as proposed to be
conducted. The Company is duly qualified to transact business and is in good
standing in each jurisdiction in which the failure so to qualify would have
a
material adverse effect on its business or properties.
2.2.
Authorization.
All
corporate action on the part of the Company, its officers, directors and
stockholders necessary for (1) the authorization, execution and delivery of
this
Agreement, and (2) the authorization, execution, issuance and delivery of the
Note and Shares has been taken or will be taken prior to the Closing.
2.4.
Valid
Issuance.
The
offer, sale, and issuance of the Note and Shares as contemplated by this
Agreement are exempt from the registration requirements of the Act and
applicable state securities laws, and will be free of restrictions on transfer
other than restrictions on transfer under this Agreement, the Note, or
applicable state and federal securities laws. The Shares will be duly and
validly issued, fully paid, and non-assessable, and will be free of restrictions
on transfer other than restrictions on transfer under applicable state and
federal securities laws. The Conversion Shares (as defined in the Note), when
issued in accordance with the terms of the Note, will be duly and validly
issued, fully paid, and non-assessable, and will be free of restrictions on
transfer other than restrictions on transfer under applicable state and federal
securities laws
2.5.
Enforceability.
This
Agreement and the Note and the transactions contemplated hereby and thereby
constitute valid and legally binding obligations of the Company, enforceable
in
accordance with their respective terms, except (a) as limited by applicable
bankruptcy, insolvency, reorganization, moratorium, and other laws of general
application affecting enforcement of creditors’ rights generally, or (b) as
limited by laws relating to the availability of specific performance, injunctive
relief, or other equitable remedies.
3.
Representations
and Warranties of the Investor.
In
connection with the transactions provided for herein, the Investor hereby
represents and warrants to the Company that:
3.1.
Authorization.
Unless
Investor is an individual, Investor has taken all necessary corporate or other
entity actions for the authorization, execution and delivery of, and the
performance of all obligations of Investor under, this Agreement and the other
documents delivered pursuant to this Agreement. This Agreement constitutes
the
Investor’s valid and legally binding obligation, enforceable in accordance with
its terms, except (a) as limited by applicable bankruptcy, insolvency,
reorganization, moratorium, and other laws of general application affecting
enforcement of creditors’ rights generally, or (b) as limited by laws relating
to the availability of specific performance, injunctive relief, or other
equitable remedies.
3.2.
Purchase
Entirely for Own Account.
Investor acknowledges that this Agreement is made with Investor in reliance
upon
Investor’s representation to the Company that the Investor’s Note and Shares
will be acquired for investment for Investor’s own account, not as a nominee or
agent, and not with a view to the resale or distribution of any part thereof,
and that Investor has no present intention of selling, granting any
participation in, or otherwise distributing the same. By executing this
Agreement, Investor further represents that Investor does not have any contract,
undertaking, agreement, or arrangement with any person to sell, transfer, or
grant participations to such person or to any third person, with respect to
the
Note and Shares.
3.3.
Disclosure
of Information.
Investor acknowledges that it has received all the information it considers
necessary or appropriate for deciding whether to acquire the Note and Shares.
Investor further represents that it has had an opportunity to ask questions
and
receive answers from the Company regarding the business, affairs and current
prospects of the Company and the terms and conditions of the offering of the
Note and Shares.
3.4.
Investment
Experience.
Investor acknowledges that it is able to fend for itself, can bear the economic
risk of the loss of its entire investment, and has such knowledge and experience
in financial or business matters that it is capable of evaluating the merits
and
risks of the investment in the Note and Shares. If other than an individual,
Investor also represents it has not been organized solely for the purpose of
acquiring the Note and Shares.
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3.5.
Accredited
Investor.
Investor is an “accredited investor” within the meaning of Rule 501(a) of
Regulation D, promulgated under the Securities Act of 1933, as amended (the
“Act”), as presently in effect and Investor has executed the Certificate of
Accredited Investor Status, attached hereto as Exhibit
B .
3.6.
Restricted
Securities.
Investor understands that the Note and Shares are characterized as “restricted
securities” under the federal securities laws inasmuch as they are being
acquired from the Company in a transaction not involving a public offering
and
that under such laws and applicable regulations such securities may be resold
without registration under the Act only in certain limited circumstances. In
this connection, Investor represents that it is familiar with SEC Rule 144,
as
presently in effect, and understands the resale limitations imposed thereby
and
by the Act.
3.7.
Further
Limitations on Disposition.
Without
in any way limiting the representations set forth above, Investor further agrees
not to make any disposition of all or any portion of the Note and Shares unless
and until:
(a)
the
transferee has agreed in writing for the benefit of the Company to be bound
by
this Section
3;
or
(b)
there
is
then in effect a registration statement under the Act covering such proposed
disposition and such disposition is made in accordance with such registration
statement; or
(c)
(i)
Investor shall have notified the Company of the proposed disposition and shall
have furnished the Company with a detailed statement of the circumstances
surrounding the proposed disposition, and (ii) if reasonably requested by the
Company, Investor shall have furnished the Company with an opinion of counsel,
reasonably satisfactory to the Company, that such disposition will not require
registration of such shares under the Act.
3.8.
Tax
Consequences.
Investor acknowledges that the tax consequences to his or her of investing
in
the Note and Shares will depend on his or her particular circumstances, and
neither the Company, shareholders, agents, officers, directors, employees,
affiliates, or consultants of any of them will be responsible or liable for
the
tax consequences to him or her of an investment in the Company. Investor will
look solely to, and rely upon, his or her own advisers with respect to the
tax
consequences of this investment. Investor acknowledges that there can be no
assurance that the united States Internal Revenue Code or the Treasury
Regulations thereunder will not be amended or interpreted in the future in
such
a manner so as to deprive the Company and the members of some or all of the
tax
benefits they might now receive, nor that some of the deductions claimed by
the
Company or the allocations of items of income, gain, loss, deduction, or credit
among the members may not be challenged by the Internal Revenue Service.
3.9
Legends.
Investor agrees that the Note and Shares shall bear substantially the following
legends, together with any additional legends required by state securities
laws:
“THIS
NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED.
THEY
MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED, HYPOTHECATED, OR OTHERWISE
TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, OR AN OPINION OF COUNSEL SATISFACTORY
TO
THE BORROWER THAT REGISTRATION IS NOT REQUIRED UNDER SUCH ACT OR UNLESS SOLD
PURSUANT TO RULE 144 UNDER SUCH ACT.”
“THESE
SHARES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED.
THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED, HYPOTHECATED, OR OTHERWISE
TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, OR AN
3
OPINION
OF COUNSEL SATISFACTORY TO THE COMPANY THAT REGISTRATION IS NOT REQUIRED UNDER
SUCH ACT OR UNLESS SOLD PURSUANT TO RULE 144 UNDER SUCH ACT.”
4.
No
Security.
The
Investor acknowledges that the Note is not secured by any assets of the Company
and is subordinated in right of payment to the secured indebtedness of the
Company. Notwithstanding the foregoing, Xxxxxx Xxxxxxx has provided a personal
guarantee for the Note in the form attached as Appendix
A to
the
Note.
5.
Miscellaneous.
5.1.
Successors
and Assigns.
Except
as otherwise provided herein, the terms and conditions of this Agreement shall
inure to the benefit of and be binding upon the respective successors and
assigns of the parties. Nothing in this Agreement, express or implied, is
intended to confer upon any party other than the parties hereto or their
respective successors and assigns any rights, remedies, obligations, or
liabilities under or by reason of this Agreement, except as expressly provided
in this Agreement.
5.2.
Governing
Law.
This
Agreement shall be governed by and construed under the laws of the State of
California as applied to agreements among California residents, made and to
be
performed entirely within the State of California.
5.3.
Counterparts.
This
Agreement may be executed in one or more counterparts, each of which shall
be
deemed an original, but all of which together shall constitute one and the
same
instrument.
5.4.
Titles
and Subtitles.
The
titles and subtitles used in this Agreement are used for convenience only and
are not to be considered in construing or interpreting this Agreement.
5.5.
Notices.
Except
as may be otherwise provided herein, all notices and other communications
required or permitted hereunder shall be in writing and shall be conclusively
deemed to have been duly given (a) when hand-delivered to the other party,
(b)
when received when sent by facsimile to the address and number set forth below,
(c) three (3) business days after deposit in the U.S. mail with first class
or
certified mail receipt requested, postage prepaid, and addressed to the other
party as set forth below, or (d) the next business day after deposit with
a national overnight delivery service, postage prepaid, addressed to the
parties as set forth below with next-business day delivery guaranteed;
provided
,
however
,
that
the sending party receives a confirmation of delivery from the delivery
service provider.
If
to the
Company:
0000
Xxxxxxxx Xxxxxx, Xxxxxxxx X
Xxx
Xxxxxxx, XX 00000
(000)
000-0000 phone
If
to the
Investor:
At
the
address shown on the signature pages hereto.
5.6.
Expenses;
Reimbursement of Legal Fees. If
any
action at law or in equity is necessary to enforce or interpret the terms of
this Agreement (including the exhibits hereto), the substantially prevailing
party shall be entitled to reasonable attorneys’ fees, costs and necessary
disbursements in addition to any other relief to which such party may be
entitled.
4
5.7.
Entire
Agreement: Amendments and Waivers. This
Agreement (including the exhibits hereto) and the other documents delivered
pursuant hereto constitute the full and entire understanding and agreement
between the parties with regard to the subjects hereof and thereof. Any term
of
this Agreement may be amended and the observance of any term of this Agreement
may be waived (either generally or in a particular instance and either
retroactively or prospectively) only with the written consent of the Company
and
a majority of the Investors. Any waiver or amendment effected in accordance
with
this Section 6.8 shall be binding upon all the Investors and the Company.
5.8.
Severability.
If one
or more provisions of this Agreement are held to be unenforceable under
applicable law, such provision shall be excluded from this Agreement and the
balance of the Agreement shall be interpreted as if such provision were so
excluded and shall be enforceable in accordance with its terms.
IN
WITNESS WHEREOF, the parties have executed this Agreement as of the date first
above written.
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THE
COMPANY:
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By:
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_______________________________________________
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Name:
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Title:
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THE
LENDER:
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By:
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_______________________________________________
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Name:
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_______________________________________________
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Title:
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_______________________________________________
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Address:
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______________________________
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_______________________________________________
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_______________________________________________
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_______________________________________________
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5
EXHIBIT
A
TO
UNIT PURCHASE AGREEMENT
CONVERTIBLE
PROMISSORY NOTE
THIS
CONVERTIBLE PROMISSORY NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF
1933. NO SALE OR DISPOSITION MAY BE EFFECTED EXCEPT IN COMPLIANCE WITH RULE
144
UNDER SAID ACT OR AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR AN
OPINION OF COUNSEL FOR THE HOLDER, SATISFACTORY TO THE COMPANY, THAT SUCH
REGISTRATION IS NOT REQUIRED UNDER THE
ACT OR RECEIPT OF A NO ACTION LETTER FROM THE SECURITIES AND EXCHANGE
COMMISSION.
THIS
CONVERTIBLE PROMISSORY NOTE AND ANY SECURITIES INTO WHICH THIS CONVERTIBLE
PROMISSORY NOTE IS CONVERTIBLE ARE SUBJECT TO RESTRICTIONS ON TRANSFER CONTAINED
IN THAT CERTAIN NOTE PURCHASE AGREEMENT, DATED FEBRUARY 13, 2007, WHICH
RESTRICTIONS ON TRANSFER ARE INCORPORATED HEREIN BY REFERENCE.
CONVERTIBLE
PROMISSORY NOTE
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$________
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_____________________,
2007
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10%
per annum
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Los
Angeles, California
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FOR
VALUE RECEIVED, Sub-Urban
Brands, Inc., a Nevada corporation (“Company”), promises to pay to the order of
________________________________________, or its assigns (“Holder”), the
principal sum of ___________________________ ($__________) with interest on
the
outstanding principal amount at the simple rate of ten percent (10%) per annum
(calculated on the basis of a 360 day year). Interest shall commence with the
date hereof and shall continue on the outstanding principal until paid in full
or converted in accordance with paragraph 4. Upon the occurrence of an Event
of
Default, as defined below, the rate of interest accruing on the unpaid principal
balance shall automatically and without further action by Investor be increased
by eight (8) percentage points above the rate of interest otherwise applicable
(the "Default Rate"), independent of whether Investor elects to accelerate
the
unpaid principal balance as a result of such default.
1.
This
note
(the “Note”) is issued pursuant to the terms of that certain Securities Purchase
Agreement (the “Agreement”) dated as of _________________, 2007, by and among
Company and Holder.
2.
Unless
converted in accordance with Paragraph 6, this Note is due and payable on
demand, which may be made at any time after the earlier of (i) _______________
(the “Maturity Date”) or (ii) the occurrence of an Event of Default (as defined
in Paragraph 5). Prepayment of principal under this Note without the express
written consent of the Holder is not permitted except in accordance Paragraph
6
hereof. This Note is not secured by any assets of the Company and is
subordinated in right of payment to the secured indebtedness of the Company.
Notwithstanding the foregoing, Xxxxxx Xxxxxxx has provided a personal guarantee
for this Note in the form attached as Appendix
A hereto.
3.
All
payments of interest and principal shall be in lawful money of the United States
of America to Holder, at the address specified in the Agreement, or at such
other address as may be specified from time to time by Holder in a written
notice delivered to Company. All payments shall be applied first to accrued
interest, and thereafter to principal.
4.
No
fractional shares shall be issued upon conversion of this Note. In lieu of
any
fractional shares to which the holder would otherwise be entitled, the Company
shall pay cash equal to the product of such fraction multiplied by the price
per
share paid by the Investors purchasing the Conversion Shares (subject to
adjustment for stock splits, dividends, and recapitalizations).
5.
Any
of
the following events are “Events of Default”:
5.1
The
Company shall fail to make any payments of principal of or interest on this
Note
when due, and such failure to pay continues for more than ten (10) days after
written notice thereof from the Holder to the Company;
6
5.2
The
Company fails to comply with or to perform when due any other material term,
obligation, covenant, or condition contained in this Note;
5.3
Any
representation or statement made by the Company to the Holder in this Note
or
the Agreement is false or misleading in any material respect either now or
at
the time made;
5.4
After
April 1, 2007:
(a)
The
Company defaults under any loan, extension of credit, security agreement,
purchase or sales agreement, or any other agreement, in favor of any other
creditor or person that may materially affect the Company’s ability to repay
this Note or to perform its obligations under this Note;
(b)
The
Company becomes insolvent, a receiver is appointed for any substantial part
of
its property, the Company makes an assignment for the benefit of creditors,
or
any proceeding is commenced by the Company (i.e. a voluntary bankruptcy
proceeding) or against the Company under any bankruptcy or insolvency laws;
or
(c)
A
material adverse change occurs in the Company’s financial condition from the
date hereof or Holder reasonably believes the prospect of payment or performance
of the indebtedness under this Note is impaired.
Notwithstanding
the immediately preceding paragraph, if any default (other than a default in
payment or initial default of Subsections 5.4(a), (b) or (c) at _______________,
2007) is curable and if the Company has not been given a notice of breach of
the
same provision of this Note within the preceding three (3) months, it may be
cured (and no event of default will be deemed to have occurred) if the Debtor,
after receiving written notice from Holder demanding cure of such default:
(a)
cures the default within thirty (30) days; or (b) if the cure requires more
than
thirty (30) days, immediately initiates steps which Holder deems in its sole
discretion to be sufficient to cure the default and thereafter continues and
completes all reasonable and necessary steps sufficient to produce compliance
as
soon as reasonably practical. Upon any Event of Default, the Holder may declare
the total outstanding principal and accrued, unpaid interest to be immediately
due and payable. All of the rights and remedies of the Holder hereunder shall
be
cumulative, and none of which shall be exclusive, to the extent permitted by
law.
6.
The
Company may (i) prepay the outstanding principal balance and unpaid accrued
interest of this Note in full or (ii) convert the outstanding principal balance
and unpaid accrued interest of this Note into shares of the Company’s common
stock (“Conversion Shares”) at a conversion price per share equal to 50% of the
average market price during the five (5) days prior to conversion, immediately
prior to or concurrently with the consummation of any sale of securities of
the
Company occurring after the date of the Agreement and having gross proceeds
to
the Company of at least $1,000,000. The Holder acknowledges that such Conversion
Shares shall be subject to the terms and conditions set forth in Section 3
of
the Agreement and upon conversion, the Holder shall execute such documents
or
instruments as may be reasonable requested by the Company consistent with
Section 3 of the Agreement. Without limiting the foregoing, the Holder
acknowledges that the Conversion Shares will be characterized as “restricted
securities” under the federal securities laws inasmuch as they are being
acquired from the Company in a transaction not involving a public offering
and
that under such laws and applicable regulations such securities may be resold
without registration under the Act, only in certain limited circumstances.
As
promptly as practicable after the date upon which conversion has occurred,
the
Company shall issue and deliver to the Holder a certificate or certificates
for
the full number of Conversion Shares to which the Holder is entitled and a
check
or cash with respect to any fractional interest in a Conversion Share as
provided in Section 4.
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7.
This
Note
is to be construed in accordance with and governed by the internal laws of
the
State of California without giving effect to any choice of law rule that would
cause the application of the laws of any jurisdiction other than the internal
laws of the State of California to the rights and duties of the Company and
the
Holder. All disputes and controversies arising out of or in connection with
this
Note shall be resolved exclusively by the state and federal courts located
in
Los Angeles County in the State of California, and each of the Company and
the
Holder hereto agrees to submit to the jurisdiction of said courts and agrees
that venue shall lie exclusively with such courts.
8.
Any
term
of this Note may be amended and the observance of any term of this Note may
be
waived (either generally or in a particular instance and either retroactively
or
prospectively), only with the written consent of the Company and the Holder.
Any
amendment or waiver effected in accordance with this paragraph shall be binding
upon the Company and the Holder.
9.
The
Company and all endorsers, guarantors and sureties of this Note and all other
persons liable or to become liable on this Note severally waive presentment
for
payment, demand, notice of demand and of dishonor and nonpayment of this Note,
notice of intention to accelerate the maturity of this Note, notice of
acceleration, protest and notice of protest, diligence in collecting, and the
bringing of suit against any other party, and agree to all renewals, extensions,
modifications, partial payments, in whole or in part with or without notice,
before or after maturity.
10.
If
one or
more provisions of this Note are held to be unenforceable under applicable
law,
such provision shall be excluded from this Note and the balance of the Note
shall be interpreted as if such provision were so excluded and shall be
enforceable in accordance with its terms
IN
WITNESS WHEREOF, the Company has caused this Note to be duly executed by its
officers, thereunto duly authorized, as of the date first above written.
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By:
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________________________
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8
APPENDIX
A
TO
CONVERTIBLE PROMISSORY NOTE
GUARANTEE
The
undersigned, Xxxxxx Xxxxxxx, is an Officer, Director, and principal stockholders
of Sub-Urban Brands, Inc., a Nevada corporation (the “Company”), the maker of
the attached promissory note (the “Note”). The undersigned unconditionally
guarantees payment in full of all of the principal, interest and other monetary
obligations of the Company under the Note, and the performance of all other
terms, provisions, promises, and covenants of the Company in the Note and hereby
consent to any extensions of time or changes in the manner of payment or
performance of any of the terms and conditions of the Note, which the Holder
(as
defined in the Note) may grant to the Company, all without notice to the
undersigned. The undersigned also agrees to indemnify and hold the Holder
harmless against all losses (including reasonable attorneys’ and experts’ fees
and court costs) in any way suffered or incurred or paid by Holder as a result
of or in any way arising from a default by the Company under the Note or under
this Guarantee by the guarantor. Nothing shall satisfy the liability of the
undersigned except the full payment and performance of all of the obligations
of
the Company to the Holder under the Note. The obligations of the undersigned
hereunder shall be direct and primary, arising in the same manner as if the
undersigned had executed
the Note. THE UNDERSIGNED ACKNOWLEDGES THAT THE TRANSACTION UNDER WHICH THIS
GUARANTEE IS GIVEN IS A COMMERCIAL TRANSACTION, AND THE UNDERSIGNED WAIVES
SUCH
RIGHTS AS HE MAY HAVE UNDER APPLICABLE FEDERAL OR STATE LAW PERTAINING TO THE
PREJUDGMENT REMEDIES AGAINST THE UNDERSIGNED. This guarantee shall be binding
upon the undersigned and his respective heirs and legal representatives, and
shall inure to the benefit of the Holder and its heirs, legal representatives,
and assigns.
____________________________
Xxxxxx
Xxxxxxx
9
EXHIBIT
B
TO
UNIT PURCHASE AGREEMENT
CERTIFICATE
OF ACCREDITED INVESTOR STATUS
Except
as
may be indicated by the undersigned below, the undersigned is an “accredited
investor,” as that term is defined in Regulation D under the Securities Act of
1933, as amended (the “Securities
Act”).
The
undersigned has initialed the box below indicating the basis on which he is
representing his status as an “accredited investor”:
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a
bank as defined in Section 3(a)(2) of the Securities Act, or any
savings
and loan association or other institution as defined in Section 3(a)(5)(A)
of the Securities 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, as amended (the “ Securities
Exchange Act ”);
an insurance company as defined in Section 2(13) of the Securities
Act; an
investment company registered under the Investment Company Act of
1940 or
a business development company as defined in Section 2(a)(48) of
that Act;
a small business investment company licensed by the U.S. Small Business
Administration under Section 301(c) 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, and such
plan
has total assets in excess of $5,000,000; an employee benefit plan
within
the meaning of the Employee Retirement Income Security Act of 1974,
if the
investment decision is made by a plan fiduciary, as defined in Section
3(21) of such Act, which is either a bank, savings and loan association,
insurance company, or registered investment adviser, or if the employee
benefit plan has total assets in excess of $5,000,000 or, if a
self-directed plan, with investment decisions made solely by persons
that
are “accredited investors”;
|
|
____
|
a
private business development company as defined in Section 202(a)(22)
of
the Investment Advisers Act of 1940;
|
|
____
|
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 in excess of $5,000,000;
|
|
____
|
a
natural person whose individual net worth, or joint net worth with
the
undersigned’s spouse, at the time of this purchase exceeds $1,000,000;
|
|
____
|
a
natural person who had an individual income in excess of $200,000
in each
of the two most recent years or joint income with the undersigned’s spouse
in excess of $300,000 in each of those years and has a reasonable
expectation of reaching the same income level in the current year;
|
|
____
|
a
trust with total assets in excess of $5,000,000, not formed for the
specific purpose of acquiring the securities offered, whose purchase
is
directed by 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;
|
|
____
|
an
entity in which all of the equity holders are “accredited investors” by
virtue of their meeting one or more of the above standards; or
|
|
____
|
an
individual who is a director or executive officer of Sub-Urban Brands,
Inc.
|
IN
WITNESS WHEREOF,
the
undersigned has executed this Certificate of Accredited Investor Status
effective as of __________________, _______.
By:
________________________
Name:
______________________
Title:
_______________________
10
