SUBSCRIPTION AGREEMENT
Exhibit 4
This SUBSCRIPTION AGREEMENT (this “Agreement”) is entered into as of the date of its
acceptance by New Generation Biofuels Holdings, Inc., a Florida corporation (the
“Company”), set forth below (the “Effective Date”), by and between the Company and
the subscriber set forth on the signature page hereto (the “Subscriber”).
R E C I T A L S
WHEREAS, the Company desires to offer (the “Offering”) up to 4,200,000 shares of
common stock of the Company, $.001 par value per share (the “Common Stock”) at a purchase
price of $0.80 per share (the “Shares”), together with warrants in the form attached hereto
as Exhibit A, exercisable for a number of shares of Common Stock equal to the number of
shares of Common Stock which such investor purchases under this Agreement at an exercise price of
$0.90 per share (the “Warrants”, and together with the Shares and the Reissued Warrants, if
any (as defined below), the “Securities”);
WHEREAS, for each investor (each a “2008 Investor”) that participated in the Company’s
private placement of Series B Convertible Preferred Stock and warrants (the “2008
Warrants”) in 2008 (the “2008 Private Placement”) and that invests in this Offering
such dollar amount that equals or exceeds 50% of the aggregate purchase price of securities
purchased in the 2008 Private Placement, the Company desires to offer to exchange such 0000 Xxxxxxx
for a new warrant exercisable for the same number of shares of the Company’s Common Stock as the
0000 Xxxxxxx (prior to adjustment for any antidilution provisions) at an exercise price of $1.00
per share and otherwise on the same terms and conditions as the Warrants included in the Offering
(the “Reissued Warrants”);
WHEREAS, the Company desires to issue and sell to the Subscriber the Securities set forth on
the signature page hereof; and
WHEREAS, in connection with the Offering the Company or its agents have provided to Subscriber
a copy of the Company’s Confidential Private Placement Memorandum dated February 24, 2009 (together
with the appendices, exhibits and attachments thereto, the “Memorandum”), which provides
certain material disclosures in connection with the Offering.
A G R E E M E N T
NOW THEREFORE, based upon the premises and mutual promises set forth below, the parties agree
as follows:
1. Subscription for Common Stock; Terms of the Offering.
1.1. Subscription and Issuance of the Securities. Subject to the terms and conditions
hereinafter set forth, the Subscriber hereby subscribes for and agrees to purchase the Securities
set forth on the signature page hereof, for an aggregate purchase price equal to $1,600,000 (the
“Purchase Price”). The Company reserves the right in its sole discretion to increase the
number
of Shares in the Offering if sufficient demand exists. The Purchase Price is payable by wire
transfer (in accordance with the wire transfer instructions set forth in the Memorandum) of
immediately available funds delivered at the Closing (as defined below).
1.2. Subscription Period. The Company may, in its sole discretion, continue to accept
subscriptions on or before the third calendar day following the initial Closing Date (as defined
below).
1.3. Right to Reject. The Company reserves the right to reject this subscription in
whole or in part or terminate the Offering in its sole and absolute discretion. If Subscriber’s
subscription is rejected in whole, or the Offering is terminated without a Closing occurring, all
funds received from the Subscriber will be promptly returned without interest, penalty, expense or
deduction, and this Agreement shall thereafter be of no further force or effect. If Subscriber’s
subscription is rejected in part, the funds for the rejected portion of such subscription will be
promptly returned without interest, penalty, expense or deduction and this Agreement will continue
in full force and effect to the extent such subscription was accepted.
2. Exchange of 2008 Warrants for Reissued Warrants. Any Subscriber that (i) is a 2008
Investor and (ii) invests in this Offering such dollar amount that equals or exceeds 50% of the
aggregate purchase price of securities purchased by such investor in the 2008 Private Placement may
exchange, at the Subscriber’s option, exercisable only at the Closing, any or all of the 2008
Warrants issued to such investor in the 2008 Private Placement for Reissued Warrants. To receive
the Reissued Warrants, the Subscriber must make an election on a form provided by the Company
(which the Company shall provide no later than the Closing to all 2008 Investors investing in this
Offering) and send the 2008 Warrants to the Company for cancellation, to be received no later than
30 days following the Closing, at the address provided in Section 8.3. In consideration therefor
and upon receipt of the Subscriber’s 2008 Warrants, the Company shall issue the Reissued Warrants
to the Subscriber. The Subscriber represents and warrants to the Company that as of the date of
exchange the 2008 Warrants delivered by the Subscriber to the Company pursuant to this Section 2
shall be owned by the Subscriber, free and clear of any encumbrances, liens or restrictions.
3. Closing.
3.1. Closing. The Closing of the transactions contemplated hereby (the
“Closing”) shall take place on the date the Company declares the Closing effective (the
“Closing Date”). The Closing shall occur at such place as determined by the Company.
2.2. Termination of Offering. All payments will be held by the Company until the
Company declares the Closing effective or terminates the Offering. The Offering will be terminated
if either (i) the Closing does not become effective on or prior to March 1, 2009, which date the
Company may extend, in its sole discretion, but not beyond March 31, 2009, or (ii) the Company
elects to terminate the Offering. If the Offering is terminated, the Company will return any
payments received, without interest, to the Subscribers.
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3. Representations and Warranties of the Company. The Company hereby represents and
warrants to the Subscriber that the following representations and warranties shall be true
immediately prior to the Closing:
3.1. Organization; Good Standing; Qualification. The Company is a corporation duly
organized, validly existing and in good standing under the laws of the state of Florida and has all
requisite corporate power and authority to carry on its business as presently 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 to so qualify would have a material adverse
effect on the consolidated financial condition or results of operations of the Company.
3.2. Capitalization. The authorized capital stock of the Company immediately prior to
the Closing consists of 100,000,000 shares of Common Stock of which 20,300,621 shares are
outstanding as of February 13, 2009, 300,000 shares of Series A preferred stock, par value $.001
per share, of which 26,400 shares are outstanding as of February 13, 2009 and 250,000 shares of
Series B preferred stock, par value $.001 per share, of which 70,044 shares are outstanding as of
February 13, 2009. Options to purchase 8,157,289 shares of Common Stock are outstanding as of
February 13, 2009, and warrants to purchase 3,382,648 shares of Common Stock are outstanding as of
February 13, 2009. All of the issued and outstanding capital stock of New Generation Biofuels,
Inc., a Delaware corporation and wholly owned subsidiary of the Company (“Subsidiary”), is
owned by the Company.
3.3. Authorization. The Company’s board of directors has taken all corporate action
required to be taken to authorize the Company to enter into this Agreement and to issue the
Securities. This Agreement when executed and delivered by the Company, shall constitute the valid
and legally binding obligation of the Company, enforceable against the Company in accordance with
its terms except (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium,
fraudulent conveyance, or other laws of general application relating to or affecting the
enforcement of creditors’ rights generally, or (ii) as limited by laws relating to the availability
of specific performance, injunctive relief, or other equitable remedies and public policy
limitations on the enforcement of indemnification for violations of securities laws.
3.4. Valid Issuance of Securities. The Securities, when issued, sold and delivered in
accordance with the terms and for the consideration set forth in this Agreement, and the shares of
Common Stock issuable upon exercise of the Warrants and the Reissued Warrants will be duly
authorized, validly issued, fully paid and non-assessable and free of restrictions on transfer
other than restrictions on transfer under this Agreement and under applicable state and federal
securities laws.
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3.5. SEC Documents, Financial Statements.
(a) True and complete copies of all documents filed by the Company with the Securities and
Exchange Commission (“SEC”) and incorporated by reference into the Memorandum (the
“Incorporated SEC Documents”) are publicly available on the SEC XXXXX database
(xxx.xxx.xxx). As of their respective filing dates, the Incorporated SEC Documents complied as to
form in all material respects with the requirements of the Securities Exchange Act
of 1934, as amended (the “Exchange Act”) and the Securities Act of 1933, as amended,
and each of the Incorporated SEC Documents was timely filed. To the Company’s knowledge, as of the
date hereof, none of the Incorporated SEC Documents is subject to ongoing SEC review or outstanding
SEC comment. Each of the Incorporated SEC Documents, as of the date it was filed with the SEC, did
not contain any untrue statement of material fact or omitted to state a material fact required to
be stated therein or necessary to make the statements made therein, in light of the circumstances
in which they were made, not misleading, except to the extent corrected, supplemented or superseded
by a subsequently filed Incorporated SEC Document.
(b) The financial statements of the Company, including the notes thereto, included in the
Incorporated SEC Documents (the “Company Financial Statements”) (i) complied as to form in
all material respects with applicable accounting requirements and with the published rules and
regulations of the SEC with respect thereto as of their respective dates; (ii) have been prepared
in accordance with GAAP applied on a basis consistent throughout the periods indicated and
consistent with each other (except as may be indicated in the notes thereto or, in the case of
unaudited statements, included in Quarterly Reports on Form 10-Q, as permitted by Form 10-Q of the
SEC); and (iii) present fairly in all material respects the consolidated financial condition and
results of operations of the Company as of the respective dates and for the respective periods
indicated therein (subject, in the case of unaudited statements, to normal, recurring year-end
adjustments).
3.6. Absence of Undisclosed Liabilities. The Company has no material liabilities
except (i) liabilities provided for or reserved against in the Company Financial Statements, (ii)
liabilities disclosed in the Memorandum, and (iii) liabilities arising in the ordinary course of
business consistent with past practice since September 30, 2008.
3.7 Compliance with Rule 144. Rule 144 provides that all non-affiliates who have held
restricted securities of an SEC-reporting company for at least six months and have not had an
affiliate relationship with the issuer during the preceding three months may sell their securities
without restriction or limitation, other than that the issuer must be in compliance with the rule’s
current public information requirements during the six months following satisfaction of the
six-month holding period requirement. It also provides that all non-affiliates who have held
restricted shares of an SEC-reporting company for more than one year, may freely sell the
securities without regard to any Rule 144 conditions. The Company will undertake all reasonable
efforts to comply with Rule 144’s current information requirement, including compliance with the
filing and reporting requirements of section 13 or 15(d) of the Securities Exchange Act of 1934, as
amended, (the “Exchange Act”).
4. Representations and Warranties of the Subscriber. The Subscriber hereby acknowledges,
agrees with and represents and warrants to the Company as follows:
4.1. Authorization. The Subscriber has full power and authority to enter into this
Agreement, the execution and delivery of which has been duly authorized, if applicable, and this
Agreement constitutes a valid and legally binding obligation of the Subscriber.
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4.2. Securities Exemption. The Subscriber acknowledges his, her or its understanding
that the offering and sale of the Securities is intended to be exempt from registration under the
Securities Act of 1933, as amended (the “Securities Act”), by virtue of Section 4(2) of the
Securities Act and the provisions of Regulation D promulgated thereunder (“Regulation D”).
In furtherance thereof, the Subscriber represents and warrants to the Company as follows:
(a) The Subscriber realizes that the basis for the exemption from registration may not be
available if, notwithstanding the Subscriber’s representations contained herein, the Subscriber is
merely acquiring the Securities for a fixed or determinable period in the future, or for a market
rise, or for sale if the market does not rise. The Subscriber does not have any such intention.
(b) The Subscriber is acquiring the Securities solely for the Subscriber’s own beneficial
account, for investment purposes, and not with view to, or resale in connection with, any
distribution of the Securities.
(c) The Subscriber has the financial ability to bear the economic risk of his, her or its
investment, has adequate means for providing for their current needs and contingencies, and has no
need for liquidity with respect to the investment in the Company.
(d) The Subscriber and the Subscriber’s attorney, accountant, purchaser representative and/or
tax advisor, if any (collectively, “Advisors”), have received this Agreement, together with
the Memorandum, and all other documents provided by the Company pursuant to the requests of the
Subscriber or its Advisors, if any, and have carefully reviewed them and they understand the
information contained therein, prior to the execution of this Agreement.
(e) The Subscriber (together with his, her or its Advisors, if any) has such knowledge and
experience in financial and business matters as to be capable of evaluating the merits and risks of
the prospective investment in the Securities. If other than an individual, the Subscriber also
represents it has not been organized solely for the purpose of acquiring the Securities.
4.3. Investor Questionnaire. The information in the Investor Questionnaire completed
and executed by the Subscriber in the form attached as Exhibit B hereto (the “Investor
Questionnaire”) is true and accurate in all respects, and the Subscriber is an “accredited
investor,” as that term is defined in Rule 501(a) of Regulation D.
4.4. Restricted Securities. The Subscriber represents, warrants and agrees that he,
she or it will not sell or otherwise transfer the Securities without registration under the
Securities Act or an exemption therefrom, and fully understands and agrees that the Subscriber must
bear the economic risk of his, her or its purchase because, among other reasons, the Securities
have not been registered under the Securities Act or under the securities laws of any state and,
therefore, cannot be resold, pledged, assigned or otherwise disposed of unless they are
subsequently registered under the Securities Act and under the applicable securities laws of such
states, or an exemption from such registration is available. In particular, the Subscriber is
aware that the Securities are “restricted securities,” as such term is defined in Rule 144
promulgated under the Securities Act (“Rule 144”), and they may not be sold pursuant to
Rule 144 unless all of the conditions of Rule 144 are met. The Company is under no obligation to
register the Securities on his, her or its behalf or to assist them in complying with any exemption
from registration under the Securities Act or applicable state securities laws. The Subscriber
understands that any sales or transfers of the Securities are further restricted by state
securities laws and the provisions of this Agreement.
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4.5. Reliance on Representations. No representations or warranties have been made to
the Subscriber by the Company, or any of their respective officers, employees, agents, sub-agents,
affiliates or subsidiaries, other than any representations of the Company contained herein, and in
subscribing for the Securities the Subscriber is not relying upon any representations other than
those contained herein.
4.6. Investment Risk. The Subscriber understands and acknowledges that his, her or
its purchase of the Securities is a speculative investment that involves a high degree of risk and
the potential loss of their entire investment and has carefully read and considered the matters set
forth in the Memorandum and in the Incorporated SEC Documents and in particular the matters under
the caption “Risk Factors” therein, and, in particular, acknowledges that the Company has a limited
operating history and is engaged in a highly competitive business.
4.7. Commitment to Investments. The Subscriber’s overall commitment to investments
that are not readily marketable is not disproportionate to the Subscriber’s net worth, and an
investment in the Securities will not cause such overall commitment to become excessive.
4.8. Legend. The Subscriber understands and agrees that the certificates for the
Securities shall bear substantially the following legend until (i) such shares shall have been
registered under the Securities Act and effectively disposed of in accordance with a registration
statement that has been declared effective or (ii) in the opinion of counsel for the Company such
Securities may be sold without registration under the Securities Act, as well as any applicable
“blue sky” or state securities laws:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY APPLICABLE
STATE SECURITIES LAWS. SUCH SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT PURPOSES
AND MAY NOT BE OFFERED FOR SALE, SOLD, DELIVERED AFTER SALE, TRANSFERRED, PLEDGED OR
HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FILED BY THE
ISSUER WITH THE U.S. SECURITIES AND EXCHANGE COMMISSION COVERING SUCH SECURITIES
UNDER THE SECURITIES ACT OR AN OPINION OF COUNSEL SATISFACTORY TO THE ISSUER THAT
SUCH REGISTRATION IS NOT REQUIRED.
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4.10. Status of Securities. Neither the U.S. Securities and Exchange Commission (the
“SEC”) nor any state securities commission has approved the Securities or passed upon or endorsed
the merits of the Offering or confirmed the accuracy or determined the adequacy of any information
provided by the Company to the Subscriber or its Advisors. Neither this Agreement nor any of such
information has been reviewed by any federal, state or other regulatory authority.
4.11. Disclosure of Information. The Subscriber and his, her or its Advisors, if any,
have had a reasonable opportunity to ask questions of and receive answers from a person or persons
acting on behalf of the Company concerning the offering of the Securities and the business,
financial condition, results of operations and prospects of the Company, and all such questions
have been answered to the full satisfaction of the Subscriber and his, her or its Advisors, if any.
The Subscriber is unaware of, is in no way relying on, and did not become aware of the offering of
the Securities through or as a result of, any form of general solicitation or general advertising
including, without limitation, any article, notice, advertisement or other communication published
in any newspaper, magazine or similar media or broadcast over television or radio, or electronic
mail over the internet, in connection with the offering and sale of the Securities and is not
subscribing for Securities and did not become aware of the offering of the Securities through or as
a result of any seminar or meeting to which the Subscriber was invited by, or any solicitation of a
subscription by, a person not previously known to the Subscriber in connection with investments in
securities generally. The Subscriber further acknowledges that the Subscriber has had the
opportunity to request and receive drafts of the Company ‘s financial statements for the year ended
December 31, 2008 and its annual report on Form 10-K for the fiscal year ended December 31, 2008
and that such information is not yet publicly available and accordingly has not been provided to
investors. To the extent that the Subscriber has requested and received this material in its
current draft form, or any other non-public information which the Company identifies as likely to
be material, the Subscriber acknowledges that they must keep such information confidential and may
not trade in the Company’s securities until the Company has filed its annual report on Form 10-K
for the fiscal year ended December 31, 2008, expected to be filed by March 31, 2009.
4.12. No Claim. The Subscriber has taken no action which would give rise to any claim
by any person for brokerage commissions, finders’ fees or the like relating to this Agreement or
the transactions contemplated hereby.
4.13. Forward-Looking Statements. The Subscriber acknowledges that any estimates or
forward-looking statements or projections included in the information provided by the Company, were
prepared by the management of the Company in good faith, but that the attainment of any such
projections, estimates or forward-looking statements cannot be guaranteed by the Company or such
management and should not be relied upon.
4.14. No Inconsistent Information. No oral or written representations have been made,
or oral or written information furnished, to the Subscriber or his, her or its Advisors, if any, in
connection with the offering of the Shares which are in any way inconsistent with the information
contained herein or in the Memorandum.
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4.15. ERISA. (For ERISA plans only) The fiduciary of the Employee Retirement Income
Security Act of 1974 (“ERISA”) plan (the “Plan”) represents that such fiduciary has
been informed of an understands the Company’s investment objectives, policies and strategies, and
that the decision to invest “plan assets” (as such term is defined in ERISA) in the Company is
consistent with the provisions of ERISA that require diversification of plan assets and impose
other fiduciary responsibilities. The Subscriber or Plan fiduciary (a) is responsible for the
decision to invest in the Company; (b) is independent of the Company and any of their respective
affiliates; (c) is qualified to make such investment decision; and (d) in making such decision, the
Subscriber or Plan fiduciary has not relied primarily on any advice or recommendation of the
Company or any of its affiliates.
5. Xxxxxxx Xxxxxxx Prohibition; Indemnity.
5.1. Xxxxxxx Xxxxxxx. Until the filing by the Company of a current report on Form 8-K
with the SEC describing the Offering, the Subscriber hereby agrees to (i) refrain from (A) engaging
in any transactions with respect to the capital stock of the Company or securities exercisable or
convertible into or exchangeable for any shares of capital stock of the Company, and (B) entering
into any transaction which would have the same effect, or entering into any swap, hedge or other
arrangement that transfers, in whole or in part, any of the economic consequences of ownership of
the capital stock of the Company and (ii) indemnify and hold harmless the Company, and their
respective officers and directors, employees, agents, sub-agents and affiliates and each other
person, if any, who controls any of the foregoing, against any loss, liability, claim, damage and
expense whatsoever (including, but not limited to, any and all expenses whatsoever reasonably
incurred in investigating, preparing or defending against any litigation commenced or threatened or
any claim whatsoever) arising out of or based upon any violation of this Section 6 by the
Subscriber.
5.2. Indemnity. The Subscriber agrees to indemnify and hold harmless the Company and
their respective officers and directors, employees, agents, sub-agents and affiliates and each
other person, if any, who controls any of the foregoing, against any loss, liability, claim, damage
and expense whatsoever (including, but not limited to, any and all expenses whatsoever reasonably
incurred in investigating, preparing or defending against any litigation commenced or threatened or
any claim whatsoever) arising out of or based upon any false representation or warranty by the
Subscriber, or the Subscriber’s breach of, or failure to comply with, any covenant or agreement
made by the Subscriber herein or in any other document furnished by the Subscriber to the Company,
a finder and their respective officers and directors, employees, agents, sub-agents and affiliates
and each other person, if any, who controls any of the foregoing in connection with the Offering.
6. Notices to Subscribers.
(a) THE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OR THE SECURITIES LAWS OF
ANY STATE AND ARE BEING OFFERED AND SOLD IN RELIANCE ON EXEMPTIONS FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND SUCH LAWS. THE SECURITIES HAVE NOT BEEN APPROVED OR
DISAPPROVED BY THE SEC, ANY STATE
SECURITIES COMMISSION OR OTHER REGULATORY AUTHORITY, NOR HAVE ANY OF THE FOREGOING AUTHORITIES
PASSED UPON OR ENDORSED THE MERITS OF THIS OFFERING OR THE ACCURACY OR ADEQUACY OF THIS AGREEMENT
OR ANY INFORMATION PROVIDED IN CONNECTION HEREWITH. ANY REPRESENTATION TO THE CONTRARY IS
UNLAWFUL.
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(b) THE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE
TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE SECURITIES ACT, AND APPLICABLE STATE SECURITIES
LAWS, PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM. SUBSCRIBERS SHOULD BE AWARE THAT THEY MAY
BE REQUIRED TO BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME.
8. Miscellaneous Provisions.
8.1. Modification. Neither this Agreement, nor any provisions hereof, shall be
waived, modified, discharged or terminated except by an instrument in writing signed by the party
against whom any waiver, modification, discharge or termination is sought.
8.2. Survival. The Subscriber’s representations and warranties made in this Agreement
shall survive the execution and delivery of this Agreement, the delivery of the Securities and the
Closing and shall in no way be affected by any investigation of the subject matter thereof made by
or on behalf of any of the Subscribers, their Advisors or the Company, as the case may be.
8.3. Notices. Any party may send any notice, request, demand, claim or other
communication hereunder to the Subscriber at the address set forth on the signature page of this
Agreement or to the Company at New Generation Biofuels Holdings, Inc., 0000 Xxxxxxx Xxxxxxxxx,
Xxxxx 0000, Xxxx Xxxx, Xxxxxxx 00000 (fax: (000) 000-0000), Attention: Xxxx X. Xxxxxxxxx, Chief
Financial Officer, or such other address or facsimile number as shall have been furnished to the
party giving or making such notice, demand or delivery using any means (including personal
delivery, expedited courier, messenger service, fax, ordinary mail or electronic mail), but no such
notice, request, demand, claim or other communication will be deemed to have been duly given unless
and until it actually is received by the intended recipient. Any party may change the address to
which notices, requests, demands, claims and other communications hereunder are to be delivered by
giving the other parties written notice in the manner herein set forth.
8.4. Binding Effect. Except as otherwise provided herein, this Agreement shall be
binding upon, and inure to the benefit of, the parties to this Agreement and their heirs,
executors, administrators, successors, legal representatives and assigns. If the Subscriber is
more than one person or entity, the obligation of the Subscriber shall be joint and several and the
agreements, representations, warranties and acknowledgments contained herein shall be deemed to be
made by, and be binding upon, each such person or entity and his or its heirs, executors,
administrators, successors, legal representatives and assigns. This Agreement sets forth the
entire agreement
and understanding between the parties as to the subject matter thereof and merges and
supersedes all prior discussions, agreements and understandings of any and every nature among them.
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8.5. Assignability. This Agreement is not transferable or assignable by the
Subscriber.
8.6. Counterparts. This Agreement may be executed in two or more counterparts, each
of which shall be deemed an original, but all of which together shall constitute one and the same
instrument.
8.7. Severability. Whenever possible, each provision of this Agreement shall be
interpreted in such manner as to be effective and valid under applicable law, but if any provision
of this Agreement is held to be prohibited by or invalid under applicable law, such provision shall
be ineffective only to the extent of such prohibition or invalidity, without invalidating the
remainder of such provision or the remaining provisions of this Agreement.
8.8. Interpretation. The headings and captions used in this Agreement are for
convenience of reference only and do not constitute a part of this Agreement and shall not be
deemed to limit, characterize or in any way affect any provision of this Agreement, and all
provisions of this Agreement shall be enforced and construed as if no caption or heading had been
used herein or therein. Each defined term used in this Agreement shall have a comparable meaning
when used in its plural or singular form. The use of the word “including” herein shall mean
“including without limitation.” The parties have participated jointly in the negotiation and
drafting of this Agreement. In the event an ambiguity or question of intent or interpretation
arises, this Agreement shall be construed as if drafted jointly by the parties, and no presumption
or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any
of the provisions of this Agreement.
8.9. No Third-Party Beneficiaries. Nothing herein expressed or implied is intended or
shall be construed to confer upon or give to any person or entity other than the parties hereto and
their respective permitted successors and assigns any rights or remedies under or by reason of this
Agreement.
8.10. Entire Agreement. This Agreement and the documents referred to herein, together
with all the Exhibits hereto, constitute the entire agreement and understanding of the parties with
respect to the subject matter of this Agreement, and supersede any and all prior understandings and
agreements, whether oral or written, between or among the parties hereto with respect to the
specific subject matter hereof.
8.11. Further Assurances. The parties agree to execute such further documents and
instruments and to take such further actions as may be reasonably necessary to carry out the
purposes and intent of this Agreement.
8.12. Governing Law. This Agreement will be governed by and construed in accordance
with the laws of the State of Florida, without giving effect to any choice of law or
conflict of law provision or rule that would cause the application of the laws of any
jurisdictions other than the State of Florida.
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ALL SUBSCRIBERS MUST COMPLETE THIS PAGE
IN WITNESS WHEREOF, the undersigned has executed this Agreement on March 30, 2009.
2,000,000 x Number of Shares Subscribed For |
$.80 for each Share | = $1,600,000 Aggregate Purchase Price |
Each Subscriber shall also receive a number of Warrants initially exercisable for a number of
shares of Common Stock equal to the number of Shares of Common Stock subscribed for under this
Agreement. Each Subscriber that is (i) a 2008 Investor and (ii) invests in this Offering such
dollar amount that equals or exceeds 50% of the aggregate purchase price of securities purchased in
the 2008 Private Placement may exchange, at the Subscriber’s option, any 2008 Warrants for Reissued
Warrants, as provided in more detail in Section 2 of the Agreement.
Manner in which Title is to be held (Please Check One):
1.
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o | Individual | ||||
2.
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o | Joint Tenants with Right of Survivorship | ||||
3.
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o | Community Property | ||||
4.
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o | Tenants in Common | ||||
5.
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þ | Corporation/Partnership/Limited Liability Company | ||||
6.
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o | XXX | ||||
7.
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o | Trust/Estate/Pension or Profit Sharing | ||||
| Plan Date Opened: | ||||||
8.
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o | As a Custodian for | ||||
| Under the Uniform Gift to Minors Act of the State of | ||||||
9.
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o | Married with Separate Property | ||||
10.
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x | Xxxxx | ||||
11.
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o | Tenants by the Entirety |
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IF MORE THAN ONE SUBSCRIBER, EACH SUBSCRIBER MUST SIGN.
INDIVIDUAL SUBSCRIBERS MUST COMPLETE PAGE 13.
SUBSCRIBERS WHICH ARE ENTITIES MUST COMPLETE PAGES 14- 15.
ALL SUBSCRIBERS MUST ALSO COMPLETE AND
EXECUTE THE INVESTOR QUESTIONNAIRE
ATTACHED AS EXHIBIT B.
EXECUTE THE INVESTOR QUESTIONNAIRE
ATTACHED AS EXHIBIT B.
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EXECUTION BY NATURAL PERSONS
Exact Name in Which Title is to be Held
Address: Number and Street
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Address: Number and Street | |||
o Check if 2008 Investor |
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EXECUTION BY SUBSCRIBER WHICH IS AN ENTITY
(Corporation, Partnership, LLC, Trust, Etc.)
2020 Energy, LLC
(Corporation, Partnership, LLC, Trust, Etc.)
2020 Energy, LLC
Name of Entity (Please Print)
Date of Incorporation or Organization: November 25, 2008
Federal Taxpayer Identification Number: 00-0000000
0000 X. Xxxxxxx Xxxxxx, Xxxxx 0000
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Phoenix, AZ 85004
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000-000-0000
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Type of entity (e.g., corporation, trust, limited partnership, general partnership XXX Trust,
Pension or Profit Sharing Plan or Trust): Limited Liability Company
Date of formation or incorporation: November 25, 2008
Whether the Subscriber was organized for the specific purpose of acquiring securities of
New Generation Biofuels Holdings, Inc.:
Yes o No þ
Each individual authorized to execute documents on behalf of the Subscriber in connection with this
investment:
Name: Xxxxxxx Xxxxxx
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Name: | |||||
Title: Manager
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Title: | |||||
The Subscriber’s state of formation or incorporation: Arizona
The business of the entity: energy related investments
o Check if 2008 Investor
14
Certain Subscribers must provide the following information:
| (A) | Corporations MUST provide the articles of incorporation, by-laws, good standing
certificate and corporate resolution authorizing the purchase of shares and authorizing
the person(s) signing the subscription documents to do so. All the documents must be
certified by the Secretary or Assistant Secretary of the corporation as being true and
correct copies thereof and in full force and effect. |
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| (B) | Partnerships MUST provide a copy of the partnership agreement showing the date
of formation and giving evidence of the authority of the person(s) signing the
subscription documents to do so. |
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| (C) | Trusts MUST provide a copy of the trust agreement showing the date of formation
and giving evidence of the authority of the person(s) signing the subscription
documents to do so. |
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| (D) | Limited Liability Companies and similar organizations MUST provide their
organizational document, operating agreement, good standing certificate and evidence of
authorization for the purchase of shares the person(s) signing the subscription
documents to do so. All the documents must be certified by an appropriate officer of
the organization as being true and correct copies thereof in full force and effect. |
By:
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/s/ Xxxxxxx Xxxxxx
Title: Manager |
15
ACCEPTED March 30, 2009
NEW GENERATION BIOFUELS HOLDINGS, INC.
By:
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/s/ Xxx X. Xxxxx
Title: Chairman |
Subscription Agreement
Company Signature Page
Company Signature Page
16
Exhibit A
FORM OF $0.90 WARRANT
(Common Stock Offering)
(Common Stock Offering)
THIS WARRANT AND THE SECURITIES REPRESENTED BY THIS WARRANT HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“ACT”). THESE SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT
WITH A VIEW TO, OR IN CONNECTION WITH, THE DISTRIBUTION THEREOF.
THESE SECURITIES MAY NOT BE OFFERED, SOLD, PLEDGED OR TRANSFERRED
UNLESS (1) A REGISTRATION STATEMENT UNDER THE ACT IS IN EFFECT AS TO
THESE SECURITIES OR (2) THERE IS AN OPINION OF COUNSEL, SATISFACTORY
TO THE CORPORATION, THAT AN EXEMPTION THEREFROM IS AVAILABLE.
NEW GENERATION BIOFUELS HOLDINGS, INC.
WARRANT
TO PURCHASE COMMON STOCK
WARRANT
TO PURCHASE COMMON STOCK
Issue Date: __________, 2009
THIS WARRANT IS TO CERTIFY THAT, (the “Purchaser”), is entitled to purchase from New
Generation Biofuels Holdings, Inc., a Florida corporation (the “Company”),
_____
shares of the
Company’s common stock, par value $.001 per share (the “Common Stock”), at the Exercise
Price (as defined below).
Section 1. Certain Definitions.
As used in this Warrant, unless the context otherwise requires:
“Exercise Price” shall mean $0.90 per share, as adjusted from time to time pursuant to
Section 3 hereof.
“Securities Act” shall mean the Securities Act of 1933, as amended.
“Warrant” shall mean this Warrant and all additional or new warrants issued upon
division or combination of, or in substitution for, this Warrant. All such additional or new
warrants shall at all times be identical as to terms and conditions and date, except as to the
number of shares of Warrant Stock for which they may be exercised.
“Warrantholder” shall mean the Purchaser, as the initial holder of this Warrant, and
its nominees, successors or assigns, including any subsequent holder of this Warrant to whom it has
been legally transferred.
“Warrant Stock” shall mean the shares of the Company’s Common Stock purchasable by the
holder of this Warrant upon the exercise of this Warrant.
Section 2. Exercise of Warrant.
(a) At any time after the six month anniversary of the Issue Date but prior to the fifth
anniversary of the Issue Date (the “Expiration Date”), the Purchaser may at any time and
from time to time exercise this Warrant, in whole or in part.
(b) (i) The Warrantholder shall exercise this Warrant by means of delivering to the Company at
its office identified in Section 14 hereof (i) a written notice of exercise, including the
number of shares of Warrant Stock to be delivered pursuant to such exercise, (ii) this Warrant and
(iii) payment equal to the Exercise Price in accordance with Section 2(b)(ii). In the event
that any exercise shall not be for all shares of Warrant Stock purchasable hereunder, a new Warrant
registered in the name of the Warrantholder, of like tenor to this Warrant and for the remaining
shares of Warrant Stock purchasable hereunder, shall be delivered to the Warrantholder within ten
(10) days after any such exercise. Such notice of exercise shall be in the Subscription Form set
out at the end of this Warrant.
(ii) The Warrantholder shall pay the Exercise Price to the Company either by cash, certified
check to the order of the Company or wire transfer to an account specified by the Company. At any
time after the six month anniversary of the Issue Date, in addition to the method of payment set
forth in the immediately preceding sentence and in lieu of any cash payment required thereby, this
Warrant may also be exercised at such time by means of a “cashless exercise” in which the
Warrantholder shall be entitled to receive a certificate for the number of shares of Warrant Stock
computed using the following formula:
X =
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Y (A-B) A |
| Where | (X) = | the number of shares of Warrant Stock to be issued to the Warrantholder; | ||||
| (Y) = | the number of shares of Warrant Stock issuable upon exercise of this Warrant in accordance with the terms of this Warrant by means of a cash exercise rather than a cashless exercise; | |||||
| (A) = | the Market Price (as defined below); and | |||||
| (B) = | the Exercise Price of this Warrant, as adjusted from time to time. |
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Solely for the purposes of this paragraph, Market Price shall be calculated as of the Trading
Day (defined for this purpose as any day on which the equity securities markets are generally open
for trading) immediately preceding the date which the subscription form attached hereto is deemed
to have been sent to the Company pursuant to Section 14 hereof (such preceding date, the
“Valuation Date”). As used herein, the phrase “Market Price” shall mean (i) if the
Warrant Stock is listed or admitted for trading on a national securities exchange, an automated
quotation system or the Over the Counter Bulletin Board, the last reported sale price
per share of the Warrant Stock on the Valuation Date, or, in case no such reported sale takes
place on such day or is reported, then the average of the last reported per share bid and ask
prices for shares of the Warrant Stock on such date (or if such bid and ask prices are not
available on such date, the most recent preceding date), in either case as officially reported by
such securities exchange, quotation system or Bulletin Board on which the Common Stock is listed or
admitted to trading, (ii) if not so listed or admitted for trading, the fair market value of a
share of the Warrant Stock as determined by the Company’s board of directors in good faith, or
(iii) if such exercise is in connection with a merger or consolidation of the Company in which the
Company is not the survivor or in which the Warrant Stock is exchanged for cash or other securities
or a sale of all or substantially all of the assets of the Company (collectively, a
“Sale”), the implied price per share of the Warrant Stock resulting from such Sale.
(c) Upon exercise of this Warrant and delivery of the Subscription Form with proper payment
relating thereto, the Company shall cause to be executed and delivered to the Warrantholder a
certificate or certificates representing the aggregate number of fully-paid and nonassessable
shares of Warrant Stock issuable upon such exercise.
(d) All shares of Warrant Stock issuable upon the exercise of this Warrant in accordance with
the terms hereof will not be registered with the SEC and will not be transferable or resalable by
any subscribers except as permitted pursuant to registration or exemption under the Securities Act.
Rule 144 provides that all non-affiliates who have held restricted securities of an SEC-reporting
company for at least six months and have not had an affiliate relationship with the issuer during
the preceding three months may sell their securities without restriction or limitation, other than
that the issuer must be in compliance with the rule’s current public information requirements
during the six months following satisfaction of the six-month holding period requirement. It also
provides that all non-affiliates who have held restricted shares of an SEC-reporting company for
more than one year, may freely sell the securities without regard to any Rule 144 conditions. The
Company will undertake all reasonable efforts to comply with Rule 144’s current information
requirement, including compliance with the filing and reporting requirements of section 13 or 15(d)
of the Securities Exchange Act of 1934, as amended, (the “Exchange Act”).
(e) The stock certificate or certificates for Warrant Stock to be delivered in accordance with
this Section 2 shall be in such denominations as may be specified in said notice of
exercise and shall be registered in the name of the Warrantholder or such other name or names as
shall be designated in said notice. Such certificate or certificates shall be deemed to have been
issued and the Warrantholder or any other person so designated to be named therein shall be deemed
to have become the holder of record of such shares, including to the extent permitted by law the
right to vote such shares or to consent or to receive notice as shareholders, as of the time said
notice is delivered to the Company as aforesaid.
(f) The Company shall pay all expenses payable in connection with the preparation, issue and
delivery of stock certificates under this Section 2; provided, however,
that the Warrantholder shall be responsible for all transfer taxes resulting from the fact that any
certificate issued in respect of Warrant Stock is not in the name of the Warrantholder.
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(g) All shares of Warrant Stock issuable upon the exercise of this Warrant in accordance with
the terms hereof shall be validly issued, fully paid and nonassessable, and free from all liens and
other encumbrances thereon, other than liens or other encumbrances created by the Warrantholder or
restrictions upon transfer under federal or state securities laws.
(h) In no event shall any fractional share of Warrant Stock of the Company be issued upon any
exercise of this Warrant. If, upon any exercise of this Warrant, the Warrantholder would, except as
provided in this paragraph, be entitled to receive a fractional share of Warrant Stock, then the
Company shall deliver in cash to such holder an amount equal to such fractional interest.
Section 3. Adjustment of Exercise Price and Warrant Stock.
(a) If, at any time prior to the Expiration Date, the number of outstanding shares of Common
Stock is (i) increased by a stock dividend payable in shares of Warrant Stock or by a subdivision
or split-up of shares of Common Stock, or (ii) decreased by a combination of shares of Common
Stock, then, following the record date fixed for the determination of holders of Common Stock
entitled to receive the benefits of such stock dividend, subdivision, split-up, or combination, the
Exercise Price shall be adjusted to a new amount equal to the product of (A) the Exercise Price in
effect on such record date, and (B) the quotient obtained by dividing (x) the number of shares of
Warrant Stock into which this Warrant would be exercisable on such record date (without giving
effect to the event referred to in the foregoing clause (i) or (ii)), by (y) the number of shares
of Warrant Stock which would be outstanding immediately after the event referred to in the
foregoing clause (i) or (ii), if this Warrant had been exercised immediately prior to such record
date.
(b) Upon each adjustment of the Exercise Price as provided in Section 3(a), the
Warrantholder shall thereafter be entitled to subscribe for and purchase, at the Exercise Price
resulting from such adjustment, the number of shares of Warrant Stock equal to the product of (i)
the number of shares of Warrant Stock into which this Warrant would be exercisable prior to such
adjustment and (ii) the quotient obtained by dividing (A) the Exercise Price existing prior to such
adjustment by (B) the new Exercise Price resulting from such adjustment.
(c) If, at any time prior to 15 months after the Closing Date, the Company issues any
Additional Warrants with an Additional Warrant Exercise Price or Options with an Option Exercise
Price less than the Exercise Price of this Warrant on the date of and immediately prior to such
issuance, then the Exercise Price of this Warrant shall be reduced, concurrently with the issuance
of such Additional Warrants or Options, to the Additional Warrant Exercise Price at which such
Additional Warrants have been issued or the Option Exercise Price at which such Options have been
issued, as the case may be.
The following definitions shall apply to this section:
“Additional Warrants” shall mean warrants to subscribe for, purchase or otherwise
acquire Common Stock or Convertible Securities, which warrants are issued by the Company in a
Financing Transaction.
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“Additional Warrant Exercise Price” shall mean, for any Additional Warrants, the price
per share at which Common Stock is issuable upon exercise of such Additional Warrants, determined
by dividing (i) the aggregate amount of consideration payable to the Company upon the exercise of
such Additional Warrants, plus the total amount, if any, received or receivable by the Company as
consideration for granting such Additional Warrants, plus, in the case of Additional Warrants which
relate to Convertible Securities, the aggregate amount of additional consideration, if any, payable
upon the issue or sale of such Convertible Securities and upon the conversion or exchange thereof
into Common Stock, by (ii) the total number of shares of Common Stock issuable upon the exercise of
such Additional Warrants or upon the conversion or exchange of all such Convertible Securities
issuable upon the exercise of such Additional Warrants (and in the case where more than one
security is issued for a specified aggregate consideration, the consideration allocable to the
Additional Warrants shall be reasonably determined by the Board of Directors of the Company).
“Closing Date” shall mean the date of the initial closing of the Company’s private
placement of common stock and warrants in March 2009.
“Convertible Securities” shall mean evidence of indebtedness, preferred stock or other
securities directly or indirectly convertible into or exchangeable for Common Stock.
“Employee Awards” shall mean the grant of shares of Common Stock or Convertible
Securities (either restricted or unrestricted), options to subscribe for, purchase or otherwise
acquire Common Stock or Convertible Securities, or other equity or equity-like rights granted or
issued by the Company to employees, officers or directors of, or consultants or advisors to, the
Company or any subsidiary pursuant to a plan or other arrangement adopted by the Board of Directors
of the Company, contemplating (in the case of grants with an exercise price) that such grants
generally would be made with exercise prices at least equal to fair market value as determined by
the Board of Directors of the Company or the compensation or other committee thereof.
“Financing Transaction” shall mean a transaction commenced after the 2009 Common Stock
Issue Date which provides financing to the Company in the amount of $1,000,000 or more in cash,
excluding transactions in which (i) the only investors have, or following such transaction will
have, substantive business relationships with the Company other than the ownership of securities of
the Company or its subsidiaries, and (ii) the consideration received by the Company does not
consist solely of cash. For the avoidance of doubt, transactions such as joint ventures,
arrangements with the licensor of our proprietary technology, arrangements with customers or
suppliers, acquisitions of property, loan transactions with commercial lenders, Shares Acquired
from an Affiliate/Partner and the like where raising financing is not the primary purpose of the
transaction (as evidenced by a reasonable determination of the Board of Directors of the Company)
shall not be considered Financing Transactions.
- 5 -
“Option Exercise Price” shall mean, for any Options, the price per share for which
Common Stock is issuable upon exercise of such Options, determined by dividing (i) the
aggregate amount of consideration payable to the Company upon the exercise of such Options,
plus the total amount, if any, received or receivable by the Company as consideration for the
granting of such Options, plus, in the case of Options which relate to Convertible Securities, the
aggregate amount of additional consideration, if any, payable upon the issue or sale of such
Convertible Securities and upon the conversion or exchange thereof into Common Stock, by (ii) the
total number of shares of Common Stock issuable upon the exercise of such Options or upon the
conversion or exchange of all such Convertible Securities issuable upon the exercise of such
Options (and in the case where more than one security is issued for a specified aggregate
consideration, the consideration allocable to the Options shall be reasonably determined by the
Board of Directors of the Company).
“Options” shall mean shall mean options to subscribe for, purchase or otherwise
acquire Common Stock or Convertible Securities granted or issued by the Company in a Financing
Transaction, but excluding Employee Awards.
“Shares Acquired from Affiliate/Partner” means (i) shares which were acquired from
any affiliate of the Corporation (which for this purpose shall include any holder of 10% or more of
the Common Stock or other voting stock of the Corporation) or any strategic partner of the
Corporation, or (ii) an equivalent number of shares of Common Stock issued or reserved for issuance
where either all or part of the proceeds of such shares are used to acquire shares from any
affiliate or any strategic partner of the Corporation or an equivalent number of treasury shares
acquired from any affiliate or any strategic partner of the Corporation are retired substantially
concurrently with or as an offset to such issuance or reservation of Common Stock.
Section 4. Division and Combination.
This Warrant may be divided or combined with other Warrants upon presentation at the aforesaid
office of the Company, together with a written notice specifying the names and denominations in
which new Warrants are to be issued, signed by the Warrantholder or its agent or attorney. The
Company shall pay all expenses in connection with the preparation, issue and delivery of Warrants
under this Section 4. The Company agrees to maintain at its aforesaid office books for the
registration of the Warrants.
- 6 -
Section 5. Reclassification, Etc.
In case of any reclassification or change of the outstanding Warrant Stock of the Company
(other than as a result of a subdivision, combination or stock dividend), or in case of any
consolidation of the Company with, or merger of the Company into, another corporation or other
business organization (other than a consolidation or merger in which the Company is the continuing
corporation and which does not result in any reclassification or change of the outstanding Common
Stock of the Company) at any time prior to the Expiration Date, then, as a condition of such
reclassification, reorganization, change, consolidation or merger, lawful provision shall be made,
and duly executed documents evidencing the same from the Company or its successor shall be
delivered to the Warrantholder, so that the Warrantholder shall have the right prior to the
Expiration Date to purchase, at a total price not to exceed that payable upon the exercise of this
Warrant, the kind and amount of shares of stock and other securities and property
receivable upon such reclassification, reorganization, change, consolidation or merger by a
holder of the number of shares of Warrant Stock of the Company which might have been purchased by
the Warrantholder immediately prior to such reclassification, reorganization, change, consolidation
or merger, and in any such case appropriate provisions shall be made with respect to the rights and
interest of the Warrantholder to the end that the provisions hereof (including provisions for the
adjustment of the Exercise Price and of the number of shares purchasable upon exercise of this
Warrant) shall thereafter be applicable in relation to any shares of stock and other securities and
property thereafter deliverable upon exercise hereof.
Section 6. Reservation and Authorization of Capital Stock.
The Company shall, at all times on and after the date hereof, reserve and keep available for
issuance such number of its authorized but unissued shares of Common Stock as will be sufficient to
permit the exercise in full of all outstanding Warrants.
Section 7. Rights of Shareholders.
Nothing contained herein shall be construed to confer upon the holder of this Warrant, as
such, any of the rights of a shareholder of the Company or any right to vote for the election of
directors or upon any matter submitted to shareholders at any meeting thereof, or to give or
withhold consent to any corporate action (whether upon any recapitalization, issuance of stock,
reclassification of stock, change of par value or change of stock to no par value, consolidation,
merger, conveyance, or otherwise) or to receive notice of meetings, or to receive dividends or
subscription rights or otherwise until the Warrant shall have been exercised and the certificates
representing the Warrant Stock shall have been issued, as provided herein.
Section 8. Stock and Warrant Books.
The Company will not at any time, except upon dissolution, liquidation or winding up, close
its stock books or warrant books so as to result in preventing or delaying the exercise of any
Warrant.
Section 9. Limitation of Liability.
No provisions hereof, in the absence of affirmative action by the Warrantholder to purchase
Warrant Stock hereunder, shall give rise to any liability of the Warrantholder to pay the Exercise
Price or as a shareholder of the Company (whether such liability is asserted by the Company or
creditors of the Company).
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Section 10. Transfer
This Warrant may be transferred only upon the written consent of the Company, which approval
shall not be unreasonably withheld or delayed. Any Warrants issued upon the transfer of this
Warrant shall be numbered and shall be registered in a Warrant Register as they are issued. The
Company shall be entitled to treat the registered holder of any Warrant on the Warrant Register as
the owner in fact thereof for all purposes and shall not be bound to recognize any equitable or
other claim to, or interest in, such Warrant on the part of any other person, and shall
not be liable for any registration of transfer of Warrants that are registered or to be
registered in the name of a fiduciary or the nominee of a fiduciary unless made with the actual
knowledge that a fiduciary or nominee is committing a breach of trust in requesting such
registration or transfer, or with the knowledge of such facts that its participation therein
amounts to bad faith. This Warrant shall be transferable only on the books of the Company upon
delivery thereof duly endorsed by the Holder or by his duly authorized attorney or representative,
or accompanied by proper evidence of succession, assignment, or authority to transfer. In all cases
of transfer by an attorney, executor, administrator, guardian, or other legal representative, duly
authenticated evidence of his or its authority shall be produced. Upon any registration of
transfer, the Company shall deliver a new Warrant or Warrants to the person entitled thereto. This
Warrant may be exchanged, at the option of the Holder thereof, for another Warrant, or other
Warrants of different denominations, of like tenor and representing in the aggregate a like amount,
upon surrender to the Company or its duly authorized agent. Notwithstanding the foregoing, the
Company shall have no obligation to cause Warrants to be transferred on its books to any person if,
in the opinion of counsel to the Company, such transfer does not comply with the provisions of the
Securities Act and the rules and regulations thereunder.
Section 11. Investment Representations; Restrictions on Warrant Stock.
The Warrantholder, by accepting this Warrant, covenants and agrees that, at the time of
exercise hereof, and at the time of any proposed transfer of Warrant Stock acquired upon exercise
hereof, unless a current registration statement under the Securities Act shall be in effect with
respect to the Warrant Stock to be issued upon exercise of this Warrant, such Warrantholder will
deliver to the Company a written statement that the securities acquired by the Warrantholder upon
exercise hereof are for the account of the Warrantholder or are being held by the Warrantholder as
trustee, investment manager, investment advisor or as any other fiduciary for the account of the
beneficial owner or owners for investment and are not acquired with a view to, or for sale in
connection with, any distribution thereof (or any portion thereof) and with no present intention
(at any such time) of offering and distributing such securities (or any portion thereof). The
Warrantholder agrees that certificates representing Warrant Stock may bear a legend substantially
as follows:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”). THESE
SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN
CONNECTION WITH, THE DISTRIBUTION THEREOF. THESE SECURITIES MAY NOT BE OFFERED,
SOLD, PLEDGED OR TRANSFERRED UNLESS (1) A REGISTRATION STATEMENT UNDER THE
SECURITIES ACT IS IN EFFECT AS TO THESE SECURITIES OR (2) THERE IS AN OPINION OF
COUNSEL, SATISFACTORY TO THE CORPORATION, THAT AN EXEMPTION THEREFROM IS
AVAILABLE.
- 8 -
Section 12. Loss, Destruction of Warrant Certificates.
Upon receipt of evidence satisfactory to the Company of the loss, theft, destruction or
mutilation of any warrant and, in the case of any such loss, theft or destruction, upon receipt of
indemnity and/or security satisfactory to the Company or, in the case of any such mutilation, upon
surrender and cancellation of such Warrant, the Company will make and deliver, in lieu of such
lost, stolen, destroyed or mutilated Warrant, a new Warrant of like tenor and representing the
right to purchase the same aggregate number of shares of Warrant Stock.
Section 13. Amendments.
The terms of this Warrant may be amended, and the observance of any term herein may be waived,
but only with the written consent of the Company and the Warrantholder.
Section 14. Notices Generally.
Any notice, request, consent, other communication or delivery pursuant to the provisions
hereof shall be in writing and shall be sent by one of the following means: (i) by registered or
certified first class mail, postage prepaid, return receipt requested; (ii) by facsimile
transmission with confirmation of receipt; (iii) by overnight courier service; or (iv) by personal
delivery, and shall be properly addressed to the Warrantholder at the last known address or
facsimile number appearing on the books of the Company, or, except as herein otherwise expressly
provided, to the Company at its principal executive office at New Generation Biofuels Holdings,
Inc., 0000 Xxxxxxx Xxxxxxxxx, Xxxxx 0000, Xxxx Xxxx, Xxxxxxx 00000, (Fax: (000) 000-0000),
Attention: Xxxx X. Xxxxxxxxx, Chief Financial Officer, or such other address or facsimile number as
shall have been furnished to the party giving or making such notice, demand or delivery.
Section 15. Successors and Assigns.
This Warrant shall bind and inure to the benefit of and be enforceable by the parties hereto
and their respective permitted successors and assigns.
Section 16. Governing Law.
In all respects, including all matters of construction, validity and performance, this Warrant
and the obligations arising hereunder shall be governed by, and construed and enforced in
accordance with, the laws of the State of Florida applicable to contracts made and performed in
such State.
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IN WITNESS WHEREOF, the Company has caused this Warrant to be signed in its name by its duly
authorized officer as of the date first written above.
| NEW GENERATION BIOFUELS HOLDINGS, INC. |
||||
| By: | ||||
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SUBSCRIPTION FORM
(to be executed only upon exercise of Warrant)
(to be executed only upon exercise of Warrant)
To:
|
New Generation Biofuels Holdings, Inc. 0000 Xxxxxxx Xxxxxxxxx, Xxxxx 0000 Xxxx Xxxx, Xxxxxxx 00000 Attn: Xxxx X. Xxxxxxxxx, Chief Financial Officer |
|
| or such other address notified by the Company to the Holder. |
(1) The undersigned hereby elects to purchase
_____
shares of Warrant Stock of the Company
pursuant to the terms of the attached Warrant, and tenders herewith payment of the exercise price
in full, together with all applicable transfer taxes, if any.
(2) Payment shall take the form of (check applicable box):
o in lawful money of the United States; or
o the cancellation of such number of shares of Warrant Stock as is necessary, in accordance
with the formula set forth in subsection 2(b), to exercise this Warrant with respect to the shares
of Warrant Stock set forth above pursuant to the cashless exercise procedure set forth in
subsection 2(b).
(3) Please issue a certificate or certificates representing said shares of Warrant Stock in
the name of the undersigned or in such other name as is specified below:
The shares of Warrant Stock shall be delivered to the following:
(4) Accredited Investor. The undersigned is an “accredited investor” as defined in
Regulation D promulgated under the Securities Act of 1933, as amended.
[SIGNATURE OF HOLDER]
Name of Investing Entity: |
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Date: |
2
Exhibit B
INVESTOR QUESTIONNAIRE
INVESTOR QUESTIONNAIRE
Instructions: Check all boxes below which correctly describe you and return this Investor
Questionnaire to New Generation Biofuels Holdings, Inc., 0000 Xxxxxxx Xxxxxxxxx, Xxxxx 0000, Xxxx
Xxxx, Xxxxxxx 00000, Attention: Xxxx X. Xxxxxxxxx, Chief Financial Officer.
| o | You are |
(i) a bank, as defined in Section 3(a)(2) of the Securities Act of 1933, as amended
(the “Securities Act”),
(ii) a savings and loan association or other institution, as defined in Section
3(a)(5)(A) of the Securities Act, whether acting in an individual or fiduciary
capacity,
(iii) a broker or dealer registered pursuant to Section 15 of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”),
(iv) an insurance company as defined in Section 2(13) of the Securities Act, (v) an
investment company registered under the Investment Company Act of 1940, as amended
(the “Investment Company Act”),
(vi) a business development company as defined in Section 2(a)(48) of the Investment
Company Act,
(vii) 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, as amended,
(viii) a plan established and maintained by a state, its political
subdivisions, or an agency or instrumentality of a state or its political
subdivisions, for the benefit of its employees and you have total assets in excess
of $5,000,000, or
(ix) an employee benefit plan within the meaning of the Employee Retirement Income
Security Act of 1974, as amended (“ERISA”) and
(1) the decision that you shall subscribe for and purchase Securities, is
made by a plan fiduciary, as defined in Section 3(2 1) of ERISA, which is
either a bank, savings and loan association, insurance company, or
registered investment adviser,
(2) you have total assets in excess of $5,000,000 and the decision that you
shall subscribe for and purchase the Securities is made solely by persons or
entities that are accredited investors, as defined in Rule 501 of Regulation
D promulgated under the Securities Act (“Regulation D”) or
(3) you are a self-directed plan and the decision that you shall subscribe
for and purchase the Securities is made solely by persons or entities that
are accredited investors.
B-1
| o | You are a private business development company as defined in Section 202(a)(22) of the Investment Advisers Act of 1940, as
amended. |
|
| o | You are an organization described in Section 501(c)(3) of the Internal Revenue Code of 1986, as amended (the “Code”), a
corporation, Massachusetts or similar business trust or a partnership, in each case not formed for the specific purpose of
making an investment in the Securities and with total assets in excess of $5,000,000. |
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| o | You are a director or executive officer of New Generation Biofuels Holdings Inc. |
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| o | You are a natural person whose individual net worth, or joint net worth with your spouse, exceeds $1,000,000 at the time of
your subscription for and purchase of the Securities. |
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| o | You are 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 your spouse in excess of $300,000 in each of the two most recent years, and who has a reasonable expectation of
reaching the same income level in the current year. |
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| o | You are a trust, with total assets in excess of $5,000,000, not formed for the specific purpose of acquiring the Shares,
whose subscription for and purchase of the Shares is directed by a sophisticated person as described in Rule 506(b)(2)(ii)
of Regulation D. |
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| þ | You are an entity in which all of the equity owners are persons or entities described in one of the preceding paragraphs. |
The undersigned hereby represents and warrants that all of its answers to this Investor
Questionnaire are true as of the date of its execution of the Subscription Agreement pursuant to
which it purchased Shares of the Company.
2020 Energy, LLC
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/s/ Xxxxxxx Xxxxxx |
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Xxxxxxx Xxxxxx
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Manager
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B-2
