No.: _____________
Name of Subscriber: __________________________
FUELNATION INC.
SUBSCRIPTION AGREEMENT
FOR SHARES OF PREFERRED STOCK
Dear Sirs:
1.1 Subscription. I hereby subscribe for and agree to purchase Shares of Series
A Convertible Preferred Stock (the "Shares") as defined in the Summary of Terms
("Term Sheet") of FUELNATION INC., a Florida corporation (the "Corporation"), in
the amount of $1,000.00 per Share on the terms and conditions described therein
relating to the offering.
1.2 Purchase.
(a) I hereby tender to the Corporation a check payable to the order of
"FuelNation Inc." in an amount set forth inss.1.1 above and deliver
the check and this Subscription Agreement to FuelNation Inc. whose
address is 0000 XX 00xx Xxxxxx Xxxxx 0000, Xxxxx, Xxxxxxx 00000.
(b) The offering will continue until the earlier of the Closing (as
defined in ss.1.4) or January 31, 2004, although management may extend
it to any later date or dates in its sole discretion (the "Termination
Date"). The Company may terminate this Offering at any time without
notice, regardless of the number of Shares then sold. Any
subscriptions and related subscription funds not accepted as of the
date of termination of the Offering will be returned to investors
without interest and without deduction.
(c) This offering is being conducted by the Corporation on a "best
efforts" basis with a maximum of 30,000 Shares to be sold. All
proceeds will be paid to the Corporation on the Closing Date as
defined in ss.1.4 herein and provided the three (3) day rescission
period has expired.
1.3 Acceptance or Rejection of Subscription.
(a) I understand and agree that the Corporation reserves the right to
reject this subscription for the Shares, in whole or in part and at
any time prior to the Closing, notwithstanding prior receipt by me of
notice of acceptance of my subscription, if in its judgment it deems
such action to be in the best interests of the Corporation; and
(b) In the event of rejection of this subscription, my subscription
payment shall be promptly returned to me without deduction and without
interest and this Subscription Agreement shall have no force or
effect. In the event my subscription is accepted, the funds specified
above shall be deposited by the Corporation and the Shares shall be
promptly delivered to me at the Closing.
1.4 Closing. The Closing of this offering will occur after the sale of a minimum
of 10,000 Shares prior to the Termination Date, and thereafter proceeds from the
Shares shall be immediately available for use by the Corporation. The Shares
subscribed for herein shall not be deemed issued to or owned by me until this
Subscription Agreement has been executed by me and countersigned by the
Corporation and a Closing has occurred.
2.1 Disclosure. Because this offering is limited to accredited investors in
reliance upon exemptions contained in the Securities Act of 1933 ("Securities
Act") and Rule 506 promulgated thereunder and applicable state securities laws,
the Shares are being sold without registration under the Securities Act.
Accordingly, the Corporation is offering the Shares utilizing the Term Sheet. I
acknowledge receipt of the Term Sheet and have reviewed or had reasonable access
to all exhibits listed therein for my inspection.
3.1 Investor Representations and Warranties. I acknowledge, represent and
warrant to, and agree with the Corporation as follows:
(a) I have not received any general solicitation or general advertising
regarding the purchase of the Shares;
(b) I have determined that the purchase of the Shares of the Corporation
is a suitable investment for me;
(c) I understand that the offer and sale of the Shares is being made by
means of this Subscription Agreement and the Term Sheet and the
documents annexed as exhibits to the Term Sheet, and I am aware of the
high degree of risk associated with an investment in the Shares. Among
other things, I have reviewed the risk factors contained in the Term
Sheet;
(d) I acknowledge and am aware that there is no assurance as to the future
performance of the Corporation;
(e) I am purchasing the Shares for my own account for investment, and not
with a view to or for sale in connection with the distribution of the
Shares or with any present intention of selling or otherwise disposing
of all or any part of the Shares. I agree that I must bear the
economic risk of my investment for an indefinite period of time
because, among other reasons, the Shares have not been registered
under the Securities Act or under the securities laws of any states
and, therefore, cannot be resold, pledged, assigned or otherwise
disposed of unless they are subsequently registered under the
Securities Act and under applicable securities laws of such states or
an exemption from such registration is available. I understand that
the Corporation is under no obligation to register the Shares on my
behalf or to assist me in complying with any exemption from such
registration under the Securities Act or any state securities laws;
(f) I have the financial ability to bear the economic risk of my
investment in the Corporation (including its possible total loss),
have adequate means for providing for my current needs and personal
contingencies and have no need for liquidity with respect to my
investment in the Corporation;
(g) I have such knowledge and experience in financial and business matters
as to be capable of evaluating the merits and risks of an investment
in the Shares and have obtained, in my judgment, sufficient
information from the Corporation to evaluate the merits and risks of
an investment in the Corporation. I have utilized a purchaser
representative in connection with evaluating such merits and risks,
and such person has sufficient knowledge or and authority to make such
investments as set forth in writing and attached to this Subscription
Agreement, and I am familiar with and understand the terms of this
offering;
(h) I have:
(i) been furnished the Term Sheet and the exhibits thereto and any
other documents I have requested, have carefully read the Term
Sheet and understand and have evaluated the risks of a purchase
of Shares, including the risks set forth in the Term Sheet and
the information contained in the Term Sheet which is all of the
information provided by the Corporation. Any additional
information upon which I have relied upon has been obtained
through my own efforts and due diligence;
(ii) been provided an opportunity to obtain any additional information
concerning the offering, the Corporation and all other
information to the extent the Corporation possesses such
information or can acquire it without unreasonable effort or
expense; and
(iii) been given the opportunity to ask questions of, and receive
answers from, the Corporation concerning the terms and conditions
of the offering and other matters pertaining to this investment.
In addition, as required by ss.517.061(11)(a)(3), Florida
Statutes and by Rule 3E-500.005(5) thereunder, I may have, at the
offices of the Corporation, at any reasonable hour, after
reasonable prior notice, access to the materials set forth in the
Rule which the Corporation can obtain without unreasonable effort
or expense.
(i) Any investigations required in making my decision have been made
solely by me;
(j) If the undersigned is a corporation, limited partnership, limited
liability company, trust, employee benefit plan, individual retirement
account, Xxxxx Plan, or other tax-exempt entity, it is authorized and
qualified to become an Investor in the Corporation and the person
signing this Subscription Agreement on behalf of such entity has been
duly authorized by such entity to do so;
(k) No representations or warranties of any kind have been made to the
undersigned by the Corporation or any officer, employee, agent or
affiliate of it; and
(l) I hereby acknowledge and am aware that except for any rescission
rights that may be provided under applicable state laws including the
three day rescission rights provided under Florida law, I am not
entitled to cancel, terminate or revoke this subscription, and any
agreements made in connection herewith shall survive my death or
disability;
3.2 Investor Representations and Warranties Concerning Accredited Investor
Status. I represent and warrant that I am an Accredited Investor and I deliver
with this Agreement signed by me under penalties of perjury attesting to my
status as an Accredited Investor, a copy of which is attached hereto. I
represent that I am (check each applicable condition):
____ (i) a bank;
____ (ii) a savings and loan association;
____ (iii) a broker-dealer registered under the Securities Exchange
Act of 1934;
____ (iv) an insurance company;
____ (v) a natural person whose individual net worth, or joint net
worth together with such person's spouse, exceeds $1,000,000 at
the time of purchase;
____ (vi) an individual who had an income in excess of $200,000 in
each of the two most recent years (or joint income with his or
her spouse in excess of $300,000 in each of those years) and has
a reasonable expectation of reaching the same income level in the
coming year;
____ (vii) an investment company registered under the Investment
Company Act of 1940, as amended (the "1940 Act");
____ (viii) a business development company, as defined in Section
2(a)(48) of the 1940 Act;
____ (ix) a Small Business Investment Company;
____ (x) an employee benefit plan (other than a participant-directed
plan), established and maintained by a state, its political
subdivisions, or any agency or instrumentality of a state or its
political subdivisions, with total assets in excess of
$5,000,000;
____ (xi) an employee benefit plan (other than a participant-directed
plan) within the meaning of the Employee Retirement Income
Security Act of 1974 ("ERISA") if either (a) the investment
decision is made by a plan fiduciary (as defined in Section 3(21)
of ERISA) which is a bank, savings and loan association,
insurance company, or registered investment adviser, or (b) the
employee benefit plan has assets in excess of $5,000,000;
____ (xii) an XXX or self-directed employee benefit plan established
for the benefit of one individual who is an accredited investor
based on (v) or (vi) above;
____ (xiii) a participant-directed employee benefit plan other than
one described in the preceding Item (additional information may
be required; please contact the General Partner);
____ (xiv) a private business development company, as defined in
Section 202(a)(22) of the Investment Advisers Act of 1940;
____ (xv) an organization described in Section 501(c)(3) of the
Internal Revenue Code of 1986, as amended (the "Code"), not
formed for the specific purpose of acquiring the Shares, and
which has total assets in excess of $5,000,000;
____ (xvi) a corporation, Delaware or similar business trust, or
partnership, not formed for the specific purpose of acquiring the
Shares, with total assets in excess of $5,000,000;
____ (xvii) a trust with assets in excess of $5,000,000, not formed
for the specific purpose of acquiring the Shares, whose purchase
is directed by a person who has such knowledge and experience in
financial and business matters that such person is capable of
evaluating the merits and risks of an investment in the Company;
____ (xviii) a revocable trust with a single grantor who is an
individual who is an accredited investor based on (v) or (vi)
above;
____ (xix) an entity in which each equity owner is an accredited
investor based on (i) through (xviii) above;
4. Indemnification. I hereby agree to indemnify and hold harmless the
Corporation and officers, directors, shareholders, and employees, agents and
attorneys for said entities against any and all losses, claims, demands,
liabilities and expenses (including reasonable legal or other expenses) incurred
by each such person in connection with defending or investigating any such
claims or liabilities, whether or not resulting in any liability to such person)
to which any such indemnified party may become subject under the Securities Act,
under any other statute, at common law or otherwise, insofar as such losses,
claims, demands, liabilities and expenses (a) arise out of or are based upon any
untrue statement or alleged untrue statement of a material fact made by me and
contained in this Subscription Agreement, or (b) arise out of or are based upon
any breach of any representation, warranty or agreement made by me and contained
herein.
5. Arbitration. Any controversy, dispute or claim between the undersigned and
the Corporation arising out of or relating to my acquisition of Shares, this
Subscription Agreement, or its interpretation, application, implementation,
breach or enforcement which the parties are unable to resolve by mutual
agreement, shall be settled by submission by either party of the controversy,
claim or dispute to binding arbitration in Palm Beach County, Florida (unless
the parties agree in writing to a different location) before a single arbitrator
in accordance with the rules of the American Arbitration Association then in
effect. In any such arbitration proceeding the parties agree to provide all
discovery deemed necessary by the arbitrator. The decision and award made by the
arbitrator shall be final, binding and conclusive on all parties hereto for all
purposes, and judgment may be entered thereon in any court having jurisdiction
thereof.
6. Severability. In the event any parts of this Subscription Agreement are found
to be void, the remaining provisions of this Subscription Agreement shall
nevertheless be binding with the same effect as though the void parts were
deleted.
7. Counterparts. This Subscription 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. The execution of this
Subscription Agreement may be by actual or facsimile signature.
8. Benefit. This Subscription Agreement shall be binding upon and inure to the
benefit of the parties hereto and their legal representatives, successors and
assigns.
9. Notices and Addresses. All notices, offers, acceptance and any other acts
under this Subscription Agreement (except payment) shall be in writing, and
shall be sufficiently given if delivered to the addressees by Federal Express or
similar receipted delivery, or by facsimile delivery, as follows:
Subscriber: At the address set forth
in the signature block below
Corporation: FUELNATION INC.
0000 XX 00xx Xxxxxx Xxxxx 0000
Xxxxx, Xxxxxxx 00000
With a Copy To: Sachs Sax Xxxxx
000 Xxxxxx Xxxx
Xxxxx 0000
Xxxx Xxxxx, Xxxxxxx 00000
or to such other address as either of them, by notice to the other may designate
from time to time. The transmission confirmation receipt from the sender's
facsimile machine shall be conclusive evidence of successful facsimile delivery.
Time shall be counted to, or from, the date of delivery.
10. Governing Law. This Subscription Agreement and any dispute, disagreement, or
issue of construction or interpretation arising hereunder whether relating to
its execution, its validity, the obligations provided therein or performance
shall be governed or interpreted according to the laws of the State of Florida.
11. Oral Evidence. This Subscription Agreement constitutes the entire
Subscription Agreement between the parties and supersedes all prior oral and
written agreements between the parties hereto with respect to the subject matter
hereof. Neither this Subscription Agreement nor any provision hereof may be
changed, waived, discharged or terminated orally, except by a statement in
writing signed by the party or parties against which enforcement or the change,
waiver discharge or termination is sought.
12. Section Headings. Section headings herein have been inserted for reference
only and shall not be deemed to limit or otherwise affect, in any matter, or be
deemed to interpret in whole or in part any of the terms or provisions of this
Subscription Agreement.
13. Survival of Representations, Shares and Agreements. The representations,
warranties and agreements contained herein shall survive the delivery of, and
payment for, the Shares.
14. Acceptance of Subscription. The Corporation may accept this Subscription
Agreement at any time for all or any portion of the Shares subscribed for by
executing a copy hereof as provided and notifying me within a reasonable time
thereafter.
Number of Shares: ______________________ $____________________
Individual Investors
______________________ ___________________________________________
Social Security Number Print Name of Investor
___________________________________________
Signature of Investor
___________________________________________
Number and Street
___________________________________________
City, State, Zip Code
Manner in which Shares are to be held:
____ Individual Ownership
____ Tenants-in-Common
____ Joint Tenant With Right of Survivorship
____ Community Property
____ Separate Property
____ Partnership
____ Trust
____ Corporation
____ Other (please indicate)
Corporate or Other Entity
_______________________ _________________________________________
Federal ID Number Print Name of Investor
By:_________________________________________
Signature, Title
___________________________________________
Number and Street
___________________________________________
City, State, Zip Code
DATED: _____________ , 2003
By signing below the undersigned accepts the foregoing subscription and
agrees to be bound by its terms.
FUELNATION INC., a Florida Corporation
By: ________________________________
Signature, Title
