Contract
NONE
OF THE SECURITIES TO WHICH THIS PRIVATE PLACEMENT SUBSCRIPTION AGREEMENT
(THE
“SUBSCRIPTION AGREEMENT”) RELATES HAVE BEEN REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE “1933 ACT”), OR ANY U.S. STATE
SECURITIES LAWS, AND, UNLESS SO REGISTERED, NONE MAY BE OFFERED OR SOLD IN
THE
UNITED STATES OR TO U.S. PERSONS (AS DEFINED HEREIN) EXCEPT PURSUANT TO AN
EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE 1933 ACT AND IN EACH CASE ONLY IN ACCORDANCE WITH APPLICABLE
STATE SECURITIES LAWS.
(United
States Accredited Subscribers Only)
TO:
ETHOS
ENVIRONMENTAL, INC. (the “Company”)
0000
XXXXXXX XXXX XXXXX
XXX
XXXXX, XX 00000 XXX
Purchase
of Shares
1.
Subscription
1.1
The
undersigned, namely, Green Bridge Capital Partners, IV, LLC, (the “Subscriber”)
hereby irrevocably subscribes for and agrees to purchase from the Company,
on
the basis of the representations and warranties and subject to the terms
and
conditions set forth herein, 2,500,000 common shares in the capital of the
Company (the “Shares”) at the price of US$0.80 per Share (such subscription and
agreement to purchase being the “Subscription”) for the total purchase price of
$2,000,000 (the “Subscription Proceeds”) which is tendered herewith, on the
basis of the representations and warranties and subject to the terms and
conditions set forth herein.
1.2
Subject
to the terms hereof, the Subscription will be effective upon its acceptance
by
the Company. The Subscriber acknowledges that the offering of the Shares
contemplated hereby is part a private placement of Shares having an aggregate
subscription level of US$2,000,000 (the “Offering”). The Offering is not subject
to any minimum aggregate subscription level.
2.
Payment
2.1
The
Subscription Proceeds must accompany this Subscription and shall be paid
by
certified check or bank draft drawn on a U.S. national bank made payable
and
delivered to the Company. Alternatively, the Subscription Proceeds may be
wired
to the Company to the wiring instructions that are provided in this Subscription
Agreement.
2.2
The
Subscriber acknowledges and agrees that this Subscription Agreement, the
Subscription Proceeds and any other documents delivered in connection herewith
will be held on behalf of the Company.
2.3
Where
the
Subscription Proceeds are paid to the Company, the Company is entitled to
treat
such Subscription Proceeds as an interest free loan to the Company until
such
time as the Subscription is accepted and the certificates representing the
Shares have been issued to the Subscriber.
3.
Questionnaire
and Undertaking and Direction
3.1 The
Subscriber must complete, sign and return to the Company the following
documents:
(a)
two
(2)
executed copies of this Subscription Agreement; and
(b)
a
Prospective Investor Suitability Questionnaire in the form attached as Appendix
1 (the “Questionnaire”).
1
3.2 The
Subscriber shall complete, sign and return to the Company as soon as possible,
on request by the Company, any documents, questionnaires, notices and
undertakings as may be required by regulatory authorities, stock exchanges
and
applicable law.
4.
Closing
4.1 Closing
of the offering (the “Offering”) of the Shares (the “Closing”) shall occur on
____, 2007, or on such other date as may be determined by the Company (the
“Closing Date”).
5.
Acknowledgements
of Subscriber
5.1
The
Subscriber acknowledges and agrees that:
(a)
the
Shares have not been registered under the 1933 Act, or under any state
securities or “blue
sky” laws of any state of the United States, and are being offered only in a
transaction not involving any
public offering within the meaning of the 1933 Act, and, unless so registered,
may not be offered or sold
in
the United States or to U.S. Persons (as defined herein), except pursuant
to an
effective registration statement
under the 1933 Act, or pursuant to an exemption from, or in a transaction
not
subject to, the registration
requirements of the 1933 Act, and in each case only in accordance with
applicable state securities
laws;
(b)
the
Company will refuse to register any transfer of the Shares not made in
accordance with
the
provisions of Regulation S, pursuant to an effective registration statement
under the 1933 Act or pursuant
to an available exemption from, or in a transaction not subject to, the
registration requirements of the
1933
Act;
(c)
the
Company will undertake to register the Shares pursuant to that Registration
Rights Agreement executed concurrently herewith;
(d)
the
decision to execute this Subscription Agreement and purchase the Shares agreed
to be
purchased hereunder has not been based upon any oral or written representation
as to fact or otherwise made
by
or on behalf of the Company and such decision is based entirely upon a review
of
information (the
“Company Information”) which has been provided by the Company to the Subscriber.
If the Company has
presented a business plan or any other type of corporate profile to the
Subscriber, the Subscriber acknowledges
that the business plan, the corporate profile and any projections or predictions
contained in any
such
documents may not be achieved or be achievable;
(e)
the
Subscriber and the Subscriber's advisor(s) have had a reasonable opportunity
to
ask questions
of and receive answers from the Company regarding the Offering, and to obtain
additional information,
to the extent possessed or obtainable without unreasonable effort or expense,
necessary
to verify
the accuracy of the information contained in the Company Information, or
any
business plan, corporate
profile or any other document provided to the Subscriber;
(f) the
books
and records of the Company were available upon reasonable notice for
inspection,
subject to certain confidentiality restrictions, by the Subscriber during
reasonable business hours
at
its principal place of business and that all documents, records and books
pertaining to this Offering
have been made available for inspection by the Subscriber, the Subscriber's
attorney and/or advisor(s);
(g) by
execution hereof the Subscriber has waived the need for the Company to
communicate
its acceptance of the purchase of the Shares pursuant to this Subscription
Agreement;
(h) the
Company is entitled to rely on the representations and warranties and the
statements and
answers of the Subscriber contained in this Subscription Agreement and in
the
Questionnaire, and the Subscriber
will hold harmless the Company from any loss or damage it may suffer as a
result
of the Subscriber's
failure to correctly complete this Subscription Agreement or the Questionnaire;
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(i)
the
Subscriber will indemnify and hold harmless the Company and, where applicable,
its respective
directors, officers, employees, agents, advisors and shareholders from and
against any and all loss,
liability, claim, damage and expense whatsoever (including, but not limited
to,
any and all fees, costs and
expenses whatsoever reasonably incurred in investigating, preparing or defending
against any claim, lawsuit,
administrative proceeding or investigation whether commenced or threatened)
arising out of or based
upon any representation or warranty of the Subscriber contained herein, the
Questionnaire or in any other
document furnished by the Subscriber to the Company in connection herewith,
being untrue in any material
respect or any breach or failure by the Subscriber to comply with any covenant
or agreement made
by
the Subscriber to the Company in connection therewith;
(j)
the
issuance and sale of the Shares to the Subscriber will not be completed if
it
would be unlawful
or if, in the discretion of the Company acting reasonably, it is not in the
best
interests of the Company;
(k)
the
Subscriber has been advised to consult its own legal, tax and other advisors
with respect
to the merits and risks of an investment in the Shares and with respect to
applicable resale restrictions
and it is solely responsible (and the Company is in any way responsible)
for
compliance with applicable
resale restrictions;
(l)
the
Shares are not listed on any stock exchange or automated dealer quotation
system
and
no
representation has been made to the Subscriber that any of the Shares will
become listed on any stock
exchange or automated dealer quotation system, except that currently certain
market makers make market
in
shares of the Company on the National Association of Securities Dealers Inc.'s
OTC Bulletin Board;
(m)
neither
the SEC nor any other securities commission or similar regulatory authority
has
reviewed
or passed on the merits of the Shares;
(n)
no
documents in connection with this Offering have been reviewed by the SEC
or any
state
securities administrators;
(o)
there
is
no government or other insurance covering any of the Shares; and
6.
Representations,
Warranties and Covenants
6.1 The
Subscriber
hereby
represents and warrants to and covenants with the Company (which
representations, warranties and covenants shall survive the Closing)
that:
(a)
the
Subscriber is resident in the United States;
(b)
the
Subscriber has received and carefully read this Subscription Agreement;
(c)
the
Subscriber has the legal capacity and competence to enter into and execute
this
Subscription
Agreement and to take all actions required pursuant hereto and, if the
Subscriber is a corporation,
it is duly incorporated and validly subsisting under the laws of its
jurisdiction of incorporation and
all
necessary approvals by its directors, shareholders
and others have been obtained to authorize execution
and performance of this Subscription Agreement on behalf of the Subscriber;
(d)
the
Subscriber (i) has adequate net worth and means of providing for its current
financial needs
and
possible personal contingencies, (ii) has no need for liquidity in this
investment, and (iii) is able to
bear
the economic risks of an investment in the Shares for an indefinite period
of
time, and can afford the
complete loss of such investment;
3
(f)
the
entering into of this Subscription Agreement and the transactions contemplated
hereby
do
not result in the violation of any of the terms and provisions of any law
applicable to, or, if applicable,
the constating documents of, the Subscriber, or of any agreement, written
or
oral, to which the Subscriber
may be a party or by which the Subscriber is or may be bound;
(g)
the
Subscriber has duly executed and delivered this Subscription Agreement and
it
constitutes
a valid and binding agreement of the Subscriber enforceable against the
Subscriber;
(h)
the
Subscriber has the requisite knowledge and experience in financial and business
matters
as to be capable of evaluating the merits and risks of the investment in
the
Shares and the Company,
and the Subscriber is providing evidence of such knowledge and experience
in
these matters through
the information requested in the Questionnaire;
(i)
the
Subscriber understands and agrees that the Company and others will rely upon
the
truth
and
accuracy of the acknowledgements, representations and agreements contained
in
this Subscription
Agreement, and agrees that if any of such acknowledgements, representations
and
agreements
are no longer accurate
or have been breached, the Subscriber shall promptly notify the Company;
(j)
All
information contained in the Questionnaire is complete and accurate and may
be
relied
upon by the Company, and the Subscriber will notify the Company immediately
of
any material change
in
any such information occurring prior to the closing of the purchase of the
Shares;
(k)
the
Subscriber is purchasing the Shares for its own account for investment purposes
only and
not
for the account of any other person and not for distribution, assignment
or
resale to others, and no other
person has a direct or indirect beneficial interest is such Shares, and the
Subscriber has not subdivided
his interest in the Shares with any other person;
(l)
the
Subscriber is not an underwriter of, or dealer in, the common shares of the
Company, nor
is
the Subscriber participating, pursuant to a contractual agreement or otherwise,
in the distribution of the
Shares;
(m)
the
Subscriber has made an independent examination and investigation of an
investment in
the
Shares and the Company and has depended on the advice of its legal and financial
advisors and agrees
that the Company will not be responsible in anyway whatsoever for the
Subscriber's decision to invest
in
the Shares and the Company;
(n)
if
the
Subscriber is acquiring the Shares as a fiduciary or agent for one or more
investor accounts,
the investor accounts for which the Subscriber acts as a fiduciary or agent
satisfy the definition of
an
“Accredited Investor”, as the term is defined under Regulation D of the 1933
Act;
(o)
if
the
Subscriber is acquiring the Shares as a fiduciary or agent for one or more
investor accounts,
the Subscriber has sole investment discretion with respect to each such account,
and the Subscriber
has full power to make the foregoing acknowledgements, representations and
agreements on behalf
of
such account;
(p)
the
Subscriber is not aware of any advertisement of any of the Shares and is
not
acquiring
the Shares as a result of any form of general solicitation or general
advertising including advertisements,
articles, notices or other communications published in any newspaper, magazine
or similar media
or
broadcast over radio or television, or any seminar or meeting whose attendees
have been invited by
general solicitation or general advertising; and
4
(i)
that
any
person will resell or repurchase any of the Shares;
(ii)
that
any
person will refund the purchase price of any of the Shares;
(iii)
as
to the
future price or value of any of the Shares; or
(iv)
that
any
of the Shares will be listed and posted for trading on any stock exchange
or automated dealer quotation system or that application has been made to
list
and post any
of
the Shares of the Company on any stock exchange or automated dealer quotation
system.
6.2
The
Company
hereby
represents and warrants to and covenants with the Subscriber (which
representations, warranties and covenants shall survive the Closing)
that:
(a) 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 full corporate power and authority to conduct its business.
(b) Capitalization
and Voting Rights. Except as set forth in the Company’s SEC filings, issued and
outstanding capital stock of the Company is as set forth in the Company’s
Registration Statement filed with the SEC on Form SB-2 on June 13, 2007,
and all
issued and outstanding shares of the Company are validly issued, fully paid
and
nonassessable. Except as set forth herein and the Company’s SEC filings, there
are no outstanding options, warrants, agreements, convertible securities,
preemptive rights or other rights to subscribe for or to purchase any shares
of
capital stock of the Company. Except as set forth herein and in the Company’s
SEC filings, and as otherwise required by law, there are no restrictions
upon
the voting or transfer of any of the shares of capital stock of the Company
pursuant to the Company’s Articles of Incorporation (the “Articles of
Incorporation”), By-Laws or other governing documents or any agreement or other
instruments to which the Company is a party or by which the Company is
bound.
(c) Authorization;
Enforceability. The Company has all corporate right, power and authority to
enter into this Agreement and to consummate the transactions contemplated
hereby. All corporate action on the part of the Company, its directors and
stockholders necessary for the (i) authorization execution, delivery and
performance of this Agreement by the Company; and (ii) authorization, sale,
issuance and delivery of the Securities contemplated hereby and the performance
of the Company’s obligations hereunder has been taken. This Agreement has been
duly executed and delivered by the Company and constitutes a legal, valid
and
binding obligation of the Company, enforceable against the Company in accordance
with its terms, subject to laws of general application relating to bankruptcy,
insolvency and the relief of debtors and rules of law governing specific
performance, injunctive relief or other equitable remedies, and to limitations
of public policy. The Common Stock, when issued and fully paid for in accordance
with the terms of this Agreement, will be validly issued, fully paid and
nonassessable. The issuance and sale of the Shares of Common Stock contemplated
hereby will not give rise to any preemptive rights or rights of first refusal
on
behalf of any person which have not been waived in connection with this
offering.
(d) No
Conflict; Governmental Consents.
(i) The execution and delivery by the Company of this Agreement and the consummation of the transactions contemplated hereby will not result in the violation of any material law, statute, rule, regulation, order, writ, injunction, judgment or decree of any court or governmental authority to or by which the Company is bound, or of any provision of the Articles of Incorporation or By-Laws of the Company, and will not conflict with, or result in a material breach or violation of, any of the terms or provisions of, or constitute (with due notice or lapse of time or both) a default under, any lease, loan agreement, mortgage, security agreement, trust indenture or other agreement or instrument to which the Company is a party or by which it is bound or to which any of its properties or assets is subject, nor result in the creation or imposition of any lien upon any of the properties or assets of the Company.
5
(e) Licenses.
Except as otherwise set forth herein and in any related documents, the Company
has sufficient licenses, permits and other governmental authorizations currently
required for the conduct of its business or ownership of properties and is
in
all material respects in compliance therewith.
(f) Litigation. Except
as may be disclosed herein and the Company’s SEC filings, the Company knows of
no pending or threatened legal or governmental proceedings against the Company
which could materially adversely affect the business, property, financial
condition or operations of the Company or which materially and adversely
questions the validity of this Agreement or any agreements related to the
transactions contemplated hereby or the right of the Company to enter into
any
of such agreements, or to consummate the transactions contemplated hereby
or
thereby. The Company is not a party or subject to the provisions of any order,
writ, injunction, judgment or decree of any court or government agency or
instrumentality which could materially adversely affect the business, property,
financial condition or operations of the Company. There is no action, suit,
proceeding or investigation by the Company currently pending in any court
or
before any arbitrator or that the Company intends to initiate.
(g) Disclosure.
The information set forth herein and in the related documents as of the date
hereof contains no untrue statement of a material fact nor omits to state
a
material fact necessary in order to make the statements contained therein,
in
light of the circumstances under which they were made, not
misleading.
(h) Investment
Company. The Company is not an “investment company” within the meaning of such
term under the Investment Company Act of 1940, as amended, and the rules
and
regulations of the SEC thereunder.
(i) Intellectual
Property.
(i) To
the
best of its knowledge, the Company owns or possesses sufficient legal rights
to
all patents, trademarks, service marks, trade names, copyrights, trade secrets,
licenses, information and other proprietary rights and processes necessary
for
its business as now conducted and as presently proposed to be conducted,
without
any known infringement of the rights of others. Except as otherwise set forth
herein, there are no material outstanding options, licenses or agreements
of any
kind relating to the foregoing proprietary rights, nor is the Company bound
by
or a party to any material options, licenses or agreements of any kind with
respect to the patents, trademarks, service marks, trade names, copyrights,
trade secrets, licenses, information and other proprietary rights and processes
of any other person or entity other than such licenses or agreements arising
from the purchase of “off the shelf” or standard products. The Company has not
received any written communications alleging that the Company has violated
or,
by conducting its business as presently proposed to be conducted, would violate
any of the patents, trademarks, service marks, trade names, copyrights or
trade
secrets or other proprietary rights of any other person or entity.
(ii) Except
as
otherwise set forth herein, the Company is not aware that any of its employees
is obligated under any contract (including licenses, covenants or commitments
of
any nature) or other agreement, or subject to any judgment, decree or order
of
any court or administrative agency, that would interfere with their duties
to
the Company or that would conflict with the Company’s business as presently
conducted.
6
(iii) Neither
the execution nor delivery of this Agreement, nor the carrying on of the
Company’s business by the employees of the Company, nor the conduct of the
Company’s business as presently conducted, will, to the Company’s knowledge,
conflict with or result in a breach of the terms, conditions or provisions
of,
or constitute a default under, any contract, covenant or instrument under
which
any employee is now obligated.
(iv) To
the
best of the Company’s knowledge, no employee of the Company, nor any consultant
with whom the Company has contracted, is in violation of any term of any
employment contract, proprietary information agreement or any other agreement
relating to the right of any such individual to be employed by, or to contract
with, the Company because of the nature of the business conducted by the
Company; and to the best of the Company’s knowledge the continued employment by
the Company of its present employees, and the performance of the Company’s
contracts with its independent contractors, will not result in any such
violation. The Company has not received any written notice alleging that
any
such violation has occurred. Except as otherwise set forth herein and in
the
Company’s SEC filings, no employee of the Company has been granted the right to
continued employment by the Company or to any compensation following termination
of employment with the Company except for any of the same which would not
have a
material adverse effect on the business of the Company. The Company is not
aware
that any officer, key employee or group of employees intends to terminate
his,
her or their employment with the Company, nor does the Company have a present
intention to terminate the employment of any officer, key employee or group
of
employees.
(j) Title
to
Properties and Assets; Liens, Etc. The Company has good and marketable title
to
its properties and assets, including the properties and assets reflected
in the
most recent balance sheet included in the Financial Statements, and good
title
to its leasehold estates, in each case subject to no mortgage, pledge, lien,
lease, encumbrance or charge, other than (a) those resulting from taxes which
have not yet become delinquent; (b) liens and encumbrances which do not
materially detract from the value of the property subject thereto or materially
impair the operations of the Company; (c) those disclosed herein and in the
Company’s SEC filings; and (d) those that have otherwise arisen in the ordinary
course of business. The Company is in compliance with all material terms
of each
lease to which it is a party or is otherwise bound.
(k) Obligations
to Related Parties. Except as described in herein and in the Company’s SEC
filings, there are no obligations of the Company to officers, directors,
stockholders, or employees of the Company other than (a) for payment of salary
or other compensation for services rendered, (b) reimbursement for reasonable
expenses incurred on behalf of the Company and (c) for other standard employee
benefits made generally available to all employees (including stock option
agreements outstanding under any stock option plan approved by the Board
of
Directors of the Company). Except as may be disclosed in the herein and in
the
Company’s SEC filings, the Company is not a guarantor or indemnitor of any
indebtedness of any other person, firm or corporation.
6.3 In
this
Subscription Agreement, the term “U.S. Person” shall have the meaning ascribed
thereto in Regulation S and for the purpose of the Subscription includes
any
person in the United States.
7.
Acknowledgement
and Waiver
7.1
The
Subscriber has acknowledged that the decision to purchase the Shares was
solely
made on the basis of publicly available information. The Subscriber hereby
waives, to the fullest extent permitted by law, any rights of withdrawal,
rescission or compensation for damages to which the Subscriber might be entitled
in connection with the distribution of any of the Shares.
7
8. Representations
and Warranties will be Relied Upon by the Company
8.1
The
Subscriber acknowledges that the representations and warranties contained
herein
are made by it with the intention that they may be relied upon by the Company
and its legal counsel in determining the Subscriber's eligibility to purchase
the Shares under applicable securities legislation, or (if applicable) the
eligibility of others on whose behalf it is contracting hereunder to purchase
the Shares under applicable securities legislation.
The
Subscriber further agrees that by accepting delivery of the certificates
representing the Shares on the Closing Date, it will be representing and
warranting that the representations and warranties contained herein are true
and
correct as at the Closing Date with the same force and effect as if they
had
been made by the Subscriber at the Closing Date and that they will survive
the
purchase by the Subscriber of Shares and will continue in full force and
effect
notwithstanding any subsequent disposition by the Subscriber of such
Shares.
9.
Resale
Restrictions
9.1
The
Subscriber acknowledges that any resale of the Shares will be subject to
resale
restrictions contained in the securities legislation applicable to each
Subscriber or proposed transferee. The Subscriber acknowledges that the Shares
have not been registered under the 1933 Act of the securities laws of any
state
of the United States; however, the Company does intend to register the Shares
per the terms set forth in that certain Registration Rights Agreement executed
concurrently herewith. The Shares may not be offered or sold in the United
States unless registered in accordance with federal securities laws and all
applicable state securities laws or exemptions from such registration
requirements are available.
10.
Legending
and Registration of Subject Shares
10.1
The
Subscriber hereby acknowledges that that upon the issuance thereof, and until
such time as the same is no longer required under the applicable securities
laws
and regulations, the certificates representing any of the Shares will bear
a
legend in substantially the following form:
“NONE
OF THE SECURITIES REPRESENTED HEREBY HAVE BEEN REGISTERED UNDER THE UNITED
STATES SECURITIES ACT OF 1933, AS AMENDED (THE “1933 ACT”), OR ANY U.S. STATE
SECURITIES LAWS, AND, UNLESS SO REGISTERED, NONE MAY BE OFFERED OR SOLD EXCEPT
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE 1933 ACT OR PURSUANT
TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE 1933 ACT AND IN EACH CASE ONLY IN ACCORDANCE WITH APPLICABLE
STATE SECURITIES LAWS.”
The
Subscriber hereby acknowledges and agrees to the Company making a notation
on
its records or giving instructions to the registrar and transfer agent of
the
Company in order to implement the restrictions on transfer set forth and
described in this Subscription Agreement.
11.
Costs
11.1
The
Subscriber acknowledges and agrees that all costs and expenses incurred by
the
Subscriber (including any fees and disbursements of any special counsel retained
by the Subscriber) relating to the purchase of the Shares shall be borne
by the
Subscriber.
11.2 The
Subscriber hereby acknowledges and agrees to the Company making a notation
on
its records or giving instructions to the registrar and transfer agent of
the
Company in order to implement the restrictions on transfer set forth and
described in this Subscription Agreement.
8
12. Governing
Law
12.1
This
Subscription Agreement is governed by the laws of the State of Nevada and
the
federal laws of the United States of America applicable therein. The Subscriber,
in its personal or corporate capacity and, if applicable, on behalf of each
beneficial purchaser for whom it is acting, irrevocably agrees to the
jurisdiction of the State of Nevada.
13. Survival
13.1 This
Subscription Agreement, including without limitation the representations,
warranties and covenants contained herein, shall survive and continue in
full force and effect and be binding upon the parties hereto notwithstanding
the
completion of the purchase of the Shares by the Subscriber pursuant
hereto.
14.
Assignment
14.1 This
Subscription Agreement is not transferable or assignable.
15. Severability
15.1
The
invalidity or unenforceability of any particular provision of this Subscription
Agreement shall not affect or limit the validity or enforceability of the
remaining provisions of this Subscription Agreement.
16.
Entire
Agreement
16.1 Except
as
expressly provided in this Subscription Agreement and in the agreements,
instruments and other documents contemplated or provided for herein, this
Subscription Agreement contains the entire agreement between the parties
with respect to the sale of the Shares and there are no other terms,
conditions, representations or warranties, whether expressed, implied, oral
or written, by statute or common law, by the Company or by anyone else.
17.
Notices
17.1 All
notices and other communications hereunder shall be in writing and shall
be
deemed to have been duly given if mailed or transmitted by any standard
form of telecommunication. Notices to the Subscriber shall be directed to
the address on the signature page of this Subscription Agreement and notices
to
the Company shall be directed to it at the address written above,
Attention: The President; fax number: (000) 000-0000.
18.
Counterparts
and Electronic Means
18.1
This
Subscription Agreement may be executed in any number of counterparts, each
of
which, when so executed and delivered, shall constitute an original and all
of
which together shall constitute one instrument. Delivery of an executed copy
of
this Agreement by electronic facsimile transmission or other means of electronic
communication capable of producing a printed copy will be deemed to be execution
and delivery of this Agreement as of the date hereinafter set forth.
IN
WITNESS
WHEREOF,
the
Subscriber has duly executed this Subscription Agreement as of the date
hereinafter set forth.
9
DELIVERY
AND REGISTRATION INSTRUCTIONS
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1.
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Delivery
- please deliver the Share certificates to:
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_________________________________________________________________
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_________________________________________________________________
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2.
|
Registration
- registration of the certificates which are to be delivered at
closing
should be made as follows:
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_________________________________________________________________
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(name)
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|
_________________________________________________________________
|
|
|
|
(address)
|
|
|
|
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3.
|
The
undersigned hereby acknowledges that he or she will deliver to
the Company
all such additional completed forms in respect of the Subscriber's
purchase of the Shares as may be required for filing with the appropriate
securities commissions and regulatory authorities.
|
|
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_________________________________________________________________
(Name
of
Subscriber - Please type or print)
_________________________________________________________________
(Signature
and, if applicable, Office)
_________________________________________________________________
(Address
of Subscriber)
_________________________________________________________________
(City,
State, and Zip Code of Subscriber)
United
States of America
_________________________________________________________________
(Country
of Subscriber)
_________________________________________________________________
(Fax
Number and email address)
ACCEPTANCE
10
The
above-mentioned Subscription Agreement in respect of the Shares is hereby
accepted by Ethos Environmental, Inc.
DATED
at
__________________________________, the _______day of __________________,
2007.
___________________________________________
Title:
Authorized
Signatory
APPENDIX
1
11
ACCREDITED
INVESTOR QUESTIONNAIRE
All
capitalized terms herein, unless otherwise defined, have the meanings ascribed
thereto in the Subscription Agreement.
This
Questionnaire is for use by each Subscriber who is a US person (as that term
is
defined Regulation S of the United States Securities Act of 1933 (the “1933
Act”)) and has indicated an interest in purchasing Shares of ETHOS
ENVIRONMENTAL, INC. (the “Company”). The purpose of this Questionnaire is to
assure the Company that each Subscriber will meet the standards imposed by
the
1933 Act and the appropriate exemptions of applicable state securities laws.
The
Company will rely on the information contained in this Questionnaire for
the
purposes of such determination. The Shares will not be registered under the
1933
Act in reliance upon the exemption from registration afforded by Section
3(b)
and/or Section 4(2) and Regulation D of the 1933 Act. This Questionnaire
is not
an offer of the Shares or any other securities of the Company in any state
other
than those specifically authorized by the Company.
All
information contained in this Questionnaire will be treated as confidential.
However, by signing and returning this Questionnaire, each Subscriber agrees
that, if necessary, this Questionnaire may be presented to such parties as
the
Company deems appropriate to establish the availability, under the 1933 Act
or
applicable state securities law, of exemption from registration in connection
with the sale of the Shares hereunder.
The
Subscriber covenants, represents and warrants to the Company that it satisfies
one or more of the categories of “Accredited Investors”, as defined by
Regulation D promulgated under the 1933 Act, as indicated below: (Please
initial
in the space provide those categories, if any, of an “Accredited Investor” which
the Subscriber satisfies)
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______
Category 1
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An
organization described in Section 501(c)(3) of the United States
Internal
Revenue Code,
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a
corporation, a Massachusetts or similar business trust or partnership,
not
formed for the specific
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purpose
of acquiring the Shares, with total assets in excess of US
$5,000,000;
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______
Category 2
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A
natural person whose individual net worth, or joint net worth
with that person's spouse, on the
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date
of purchase exceeds US $1,000,000;
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______
Category 3
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A
natural person who had an individual income in excess of US $200,000
in each of the two most
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recent
years or joint income with that person's spouse in excess of US
$300,000
in each of those years and has a reasonable expectation of reaching
the same income level in the current year;
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______
Category 4
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A
“bank” as defined under Section (3)(a)(2) of the 1933 Act or
savings and loan association or other institution as defined
in Section 3(a)(5)(A) of the 1933 Act acting in its individual or
fiduciary capacity; a broker dealer registered pursuant to Section 15
of the Securities Exchange Act of 0000 (Xxxxxx Xxxxxx); an insurance
company as defined in Section 2(13) of the 1933 Act; an investment
company registered under the Investment Company Act of 1940 (United
States) or a business development company as defined in Section
2(a)(48) of such 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 0000 (Xxxxxx Xxxxxx); a plan
with total assets in excess of $5,000,000 established and maintained
by a state, a political subdivision thereof, or an agency or
instrumentality of a state or a political subdivision thereof, for
the benefit of its employees; an employee benefit plan within the
meaning
of the Employee Retirement Income Security Act of 1974 (United
States) whose investment decisions are 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, whose investment decisions
are made solely by persons that are accredited
investors;
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A
private business development company as defined in Section 202(a)(22)
of the Investment Xxxxxxxx Xxx xx 0000
(Xxxxxx Xxxxxx);
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______
Category 6
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A
director or executive officer of the Company;
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______
Category 7
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A
trust with total assets in excess of $5,000,000, not formed for
the specific purpose of acquiring the Shares, whose purchase is
directed by a sophisticated person as described in Rule 506(b)(2)(ii)
under the 1933 Act;
|
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______
Category 8
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An
entity in which all of the equity owners satisfy the requirements
of one
or more of the foregoing categories;
|
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12
Note
that
prospective Subscribers claiming to satisfy one of the above categories of
Accredited Investor may be required to supply the Company with a balance
sheet,
prior years' federal income tax returns or other appropriate documentation
to
verify and substantiate the Subscriber's status as an Accredited
Investor.
If
the
Subscriber is an entity which initialed Category 8 in reliance upon the
Accredited Investor categories above, state the name, address, total personal
income from all sources for the previous calendar year, and the net worth
(exclusive of home, home furnishings and personal automobiles) for each equity
owner of the said entity:
The
Subscriber hereby certifies that the information contained in this Questionnaire
is complete and accurate and the Subscriber will notify the Company promptly
of
any change in any such information. If this Questionnaire is being completed
on
behalf of a corporation, partnership, trust or estate, the person executing
on
behalf of the Subscriber represents that it has the authority to execute
and
deliver this Questionnaire on behalf of such entity.
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IN WITNESS WHEREOF, the undersigned has
executed this Questionnaire as of ____,2007
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| If a Corporation, Partnership or Other Entity: | If an Individual: |
|
___________________________________
Print or Type Name of Entity
|
_________________________________
Signature
|
|
___________________________________
Signature of Authorized Signatory
|
_________________________________
Print or Type Name
|
|
___________________________________
Type of Entity
|
_________________________________
Social Security/Tax I.D. Number
|
