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SUBSCRIPTION AGREEMENT
IN CONNECTION WITH
FORTUNE NATURAL RESOURCES CORPORATION
Offering of
up to $3.5 Million
in Principal Amount of
Subordinated Convertible Promissory Notes
Placement Agent
X. XXXXXXX SECURITIES, L.L.C.
1345 XXXXXX XX XXX XXXXXXXX
00XX XXXXX
XXX XXXX, XXX XXXX 00000
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SUBSCRIPTION AGREEMENT
AND INVESTMENT LETTER
October 14, 1997
To the Board of Directors
Fortune Natural Resources Corporation
One Commerce Green
000 Xxxx Xxxxxx Xxxx
Xxxxx 000
Xxxxxxx, Xxxxx 00000
Re: Subscription to Purchase Notes of
Fortune Natural Resources Corporation
Gentlemen:
This will acknowledge that the undersigned hereby agrees to irrevocably purchase
from Fortune Natural Resources Corporation (the "Company" or " Fortune"), a
corporation organized under the laws of the State of Delaware, a convertible
subordinated note (the "Note") in the principal amount of $__________ . The Note
to be purchased by the undersigned is part of a private placement of securities
(the "Offering") by the Company of up to $3.5 million in aggregate principal
amount of Notes. The Offering is being made only to "accredited investors" as
defined herein on a $1.25 million aggregate principal amount minimum or none to
a $3.5 million aggregate principal amount maximum best efforts basis through
October 31, 1997. Based thereon, if $1.25 million in aggregate principal amount
of Notes is not sold and paid for on or prior to October 31, 1997 (unless
extended as provided below), the Offering will terminate and all funds collected
from subscribers will be promptly returned to them without interest thereon or
deduction therefrom. The Notes will be issued only in registered form in
denominations of $10,000 or integral multiples thereof and in such principal
amounts as shall be determined by the Company.
All funds collected from subscribers pending consummation or termination of the
Offering as set forth herein will be held in the escrow account described below.
The Company is required to obtain the permission of its primary lender, Credit
Lyonnais New York Branch (the "Bank"), in order to effect this Offering.
Accordingly, no funds will be released from the escrow account to the Company
unless the Bank's written permission is obtained or the Company determines to
repay the Bank in full with the proceeds of this Offering. As of September 30,
1997, the Company owed the Bank $865,000.
If all of the Notes are sold, the Company will receive aggregate gross proceeds
of $3.5 million less the expenses of this Offering which management estimates
will approximate $485,000, including the fee and expense allowance payable to X.
Xxxxxxx Securities, LLC (the "Placement Agent") described below. The Placement
Agent, a member of the National Association of Securities Dealers, Inc. (the
"NASD"), is acting as the placement
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agent for the Company in placing this Offering. The Offering will terminate on
the sooner to occur of the sale of all of the Notes or October 31, 1997, unless
extended through December 1, 1997 by the mutual consent of the Company and the
Placement Agent.
THE UNDERSIGNED UNDERSTANDS THAT THE INFORMATION PROVIDED TO HIM WITH RESPECT TO
THE COMPANY HAS NOT BEEN INDEPENDENTLY VERIFIED BY THE PLACEMENT AGENT.
ACCORDINGLY, THERE IS NO REPRESENTATION BY THE PLACEMENT AGENT AS TO THE
COMPLETENESS OR ACCURACY OF SUCH INFORMATION.
The Placement Agent will receive a fee equal to 10% and a non-accountable
expense allowance equal to 3% of the aggregate principal amount of the Notes
sold. It will also be granted, for nominal consideration, the right, exercisable
over a five year period commencing on the last closing date of the Offering, to
purchase a number of shares of the Common Stock equal to 10% of the aggregate
gross proceeds of the Offering proceeds received by the Company, divided by 3.6.
The exercise price, subject to adjustment, will be $3.60 per share.
Xxxxx X. Xxxxx, who currently owns 279,200 shares of the Company's common stock
and warrants to purchase an additional 432,113 shares, is a registered
representative employed by the Placement Agent as the manager of its Phoenix,
Arizona branch office. Mr. Blank is participating in marketing the Offering.
Neither the Company nor the Placement Agent has obtained any independent opinion
relating to the fairness of the terms of this Offering or the compensation to be
paid to the Placement Agent for the services it will render in connection
herewith.
Xxxxx Xxxxxx, a director of Fortune, is acting as counsel to the Placement Agent
with respect to this Offering. Xx. Xxxxxx has also represented Mr. Blank for
approximately ten years. Because of the possibility that allegations of conflict
of interest could be raised in this situation, Xx. Xxxxxx has recused himself
from voting on all Fortune board of director matters associated with this
Offering.
PAYMENT FOR THE UNITS SHALL BE MADE BY CHECK PAYABLE TO "FORTUNE ESCROW ACCOUNT"
and delivered to the Placement Agent, together with an executed copy of this
Subscription Agreement and Investment Letter and the Purchaser Questionnaire
appended hereto as EXHIBIT A. Payment may be made by wire transfer pursuant to
instructions available on request from the Placement Agent.
The Notes will mature on December 31, 2007. They will bear annual interest at
the rate of 12%, payable quarterly, commencing January 1, 1998. The interest
will be computed on the basis of a 360 day year of twelve 30-day months. The
Notes will be subordinated to "Senior Debt" as defined therein. As of September
30, 1997, Senior Debt aggregated $1,893,000. The Notes will not be personally
guaranteed and there will be no sinking fund, trustee or indenture with respect
thereto.
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Each Note will be convertible, unless previously redeemed, into the Company's
common stock, par value $0.01, (the "Common Stock") after April 30, 1999, at a
price equal to the lower of (i) the higher of $3.00 per share or the average of
the daily "Closing Price" of the Common Stock, as defined in the Note, for the
20 consecutive trading days prior to the first closing date of the Offering, or
(ii) 110% above the average daily Closing Price of the Common Stock for the 60
calendar day period immediately preceding May 1, 1999. Each Note holder will
also have, on one occasion only, an "Alternate Conversion Right," as defined in
the Note, in the event that the Company should issue shares below the conversion
price prior to May 1, 1999. The conversion rate will be subject to adjustment in
accordance with appropriate anti-dilution provisions. Notes called for
redemption will be convertible to the close of business on the day before the
date fixed for redemption. Note holders will forfeit the accrued interest for
the then-current period on Notes surrendered for conversion. No cash or
fractional shares will be issued on conversion.
The Notes will be non-redeemable prior to May 1, 1999. Thereafter they will be
redeemable in whole or part on 30 days notice at the option of the Company
commencing at 110% of par, plus accrued interest, and declining at the rate of
.056% per month to par on November 1, 2000, plus accrued interest.
For a complete description of the terms of the Notes, reference is made to the
form of Note attached hereto as EXHIBIT B.
The holders of a majority of the shares of Common Stock into which the Notes may
be converted (the "Underlying Shares") shall have the right, on one occasion
only commencing on January 1, 1999 and terminating one year after the date on
which all of the Notes have been repaid and/or converted, to demand that the
Company register the Underlying Shares with the Securities and Exchange
Commission (the "Commission") and use its best efforts to have such registration
statement declared effective. The Company will also grant the Note purchasers
certain "piggy back" registration rights with respect to the Underlying Shares.
Anything to the contrary not withstanding, the Company shall not be required to
register any Underlying Shares which, in the reasonable opinion of the Company's
counsel, may be sold pursuant to the exemption from registration provided by
Section (k) of Rule 144.
The undersigned acknowledges that the Note he is purchasing, as well as any
Underlying Shares into which the Note may be converted, have not been registered
under the Securities Act of 1933 (the "Securities Act") or qualified under
applicable state securities laws and that the transferability thereof is
restricted by the registration provisions of the Securities Act as well as such
state laws. Based upon the representations and agreements being made by him
herein, the Note is being sold to him pursuant to an exemption from such
registration provided by Section 4 (2) of the Securities Act and applicable
state securities law qualification exemptions. The undersigned further
acknowledges that the basis for these exemptions may not be available if,
notwithstanding such representations, he intends merely acquiring these
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 undersigned
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represents and warrants that he does not have any such intention. The
undersigned agrees that the documentation representing the Note to be received
by him, as well as the certificates representing any Underlying Shares, will
bear a legend indicating that transfer of these securities is restricted by
reason of the fact that they have not been so registered or qualified.
The undersigned represents that he is acquiring the Note, and will acquire the
Underlying Shares if he should convert the Note, solely for his own account as
principal and not as a nominee or agent, for investment purposes only and not
with a view to resale or other distribution or fractionalization thereof, nor
with the intention of selling, transferring or otherwise disposing of all or any
part of such securities for any particular event or circumstance, except
selling, transferring or disposing of them upon full compliance with all
applicable provisions of the Securities Act, the Securities Exchange Act of 1934
(the "Exchange Act"), the Rules and Regulations promulgated by the Commission
thereunder, and any applicable state securities laws. The undersigned further
understands and agrees that (i) the securities may be sold only if they are
subsequently registered under the Securities Act and qualified under any
applicable state securities laws or, in the opinion of the Company's counsel, an
exemption from such registration and qualification is available; (ii) any
routine sales of securities made in reliance upon Rule 144 can be made only in
the amounts set forth in and pursuant to the other terms and conditions,
including applicable holding periods, of that Rule; and (iii) the Company is
under no obligation to assist him in complying with any exemption from
registration under the Securities Act, or, except as otherwise set forth herein,
to register the Note or Underlying Shares on his behalf.
The undersigned represents and warrants that he has received (i) a copy of the
Form of the Note appended hereto as EXHIBIT B; (ii) a copy of the Company's Form
10-K for the fiscal year ended December 31, 1996 appended hereto as EXHIBIT C;
(iii) a copy of the Company's Form 8-K dated March 24, 1997 appended hereto as
EXHIBIT D; (iv) a copy of the Company's Form 8-K dated April 7 1997 appended
hereto as EXHIBIT E; (v) a copy of the Company's Form 8-K dated April 18 1997
appended hereto as EXHIBIT F; (vi) a copy of the Company's Form 10-Q for the
quarter ended March 31, 1997 appended hereto as EXHIBIT G; (vii) a copy of the
Company's Form 8-K dated June 16, 1997 appended hereto as EXHIBIT H; (viii) a
copy of the Company's Form 10-Q for the quarter ended June 30, 1997 appended
hereto as EXHIBIT I; (ix) a Description of Risk Factors relating to the Company
and this Offering appended hereto as EXHIBIT J; (x) a Schedule of the Use of
Proceeds of this Offering appended hereto as EXHIBIT K; and (xi) a Description
of the Company appended hereto as EXHIBIT L, (all of the foregoing documents and
the Subscription Agreement collectively are hereinafter referred to as the
"Information Documents") and that he has read and understood all of these
documents.
The undersigned also represents and warrants that he (i) has reviewed such other
documents and obtained such other information from the Company as he deems
necessary in order for him to make an informed investment decision; (ii) has had
access
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to all relevant documents, instruments, books, and other records of or
pertaining to the Company and has had the opportunity to ask questions of and
receive answers from management and other representatives of the Company; and
(iii) is fully aware of the current business prospects, financial condition, and
operating history as set forth herein and in the Information Documents relating
to the Company. Except as may be provided in this Subscription Agreement and
Investment Letter and in the Information Documents, he warrants that no
representations, statements or inducements were made to him to purchase the
Note.
The undersigned understands that this Subscription agreement and Investment
Letter and the other Information Documents contain forward-looking statements
within the meaning of Section 27A of the Securities Act. Forward-looking
statements include statements regarding: future oil and gas production and
prices, future exploration and development spending, future drilling and
operating plans, reserve and production potential of the Company's properties
and prospects and the Company's business strategy. They are based largely on the
Company's current expectations and are subject to a number of risks and
uncertainties. Accordingly, actual events or results could differ materially
from those discussed in the forward-looking statements as a result of various
factors including, without limitation, the risk factors set forth in the
Description of Risk Factors appended hereto as EXHIBIT J.
THE UNDERSIGNED UNDERSTANDS THAT, BECAUSE OF THE SIGNIFICANT RISK FACTORS SET
FORTH HEREIN OR IN THE OTHER INFORMATION DOCUMENTS, IF THE OFFERING IS
CONSUMMATED, HE COULD LOSE HIS ENTIRE INVESTMENT.
The undersigned also understands the following:
THE NOTES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OR ANY STATE
SECURITIES LAWS AND ARE BEING OFFERED AND SOLD IN RELIANCE ON EXEMPTIONS FROM
THE REGISTRATION REQUIREMENTS OF THESE LAWS. THE NOTES HAVE NOT BEEN APPROVED OR
DISAPPROVED BY THE COMMISSION OR ANY STATE SECURITIES REGULATORY AUTHORITY NOR
HAS THE COMMISSION OR ANY SUCH AUTHORITY PASSED UPON OR ENDORSED THE MERITS OF
THE OFFERING OR THE ACCURACY OR ADEQUACY OF THIS SUBSCRIPTION AGREEMENT AND
INVESTMENT LETTER AND/OR THE INFORMATION DOCUMENTS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
IN MAKING AN INVESTMENT DECISION, INVESTORS MUST RELY ON THEIR OWN EXAMINATION
OF THE PERSON OR ENTITY CREATING THE SECURITIES AND THE TERMS OF THE OFFERING,
INCLUDING THE MERITS AND RISKS INVOLVED. THESE SECURITIES HAVE NOT BEEN
RECOMMENDED BY ANY FEDERAL OR STATE SECURITIES COMMISSION
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OR REGULATORY AUTHORITY. FURTHERMORE THE FOREGOING AUTHORITIES HAVE NOT
CONFIRMED THE ACCURACY OR ADEQUACY OF THIS DOCUMENT. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE. THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON
TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS
PERMITTED UNDER THE SECURITIES ACT, AND THE APPLICABLE STATE SECURITIES LAWS,
PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM. INVESTORS SHOULD BE AWARE THAT
THEY WILL BE REQUIRED TO BEAR THE FINANCIAL RISKS OF INVESTMENT FOR AN
INDEFINITE PERIOD OF TIME.
FLORIDA RESIDENTS ARE ADVISED THAT THESE SECURITIES HAVE NOT BEEN REGISTERED
WITH THE STATE OF FLORIDA. ANY REPRESENTATION TO THE CONTRARY IS UNLAWFUL.
PURSUANT TO SECTION 517.061 (11) (A) OF THE FLORIDA SECURITIES AND INVESTOR
PROTECTION ACT, THE SALE OF SHARES TO A FLORIDA RESIDENT SHALL BE VOIDABLE BY
THE PURCHASER EITHER (I) WITHIN THREE DAYS AFTER THE FIRST TENDER OF
CONSIDERATION IS MADE BY THE PURCHASER TO THE ISSUER, AN AGENT OF THE ISSUER OR
AN ESCROW AGENT, OR (II) WITHIN THREE DAYS AFTER THE AVAILABILITY OF THAT
PRIVILEGE HAS BEEN COMMUNICATED TO THE PURCHASER, WHICHEVER OCCURS FIRST,
PROVIDED, HOWEVER, THAT THERE ARE MORE THAN FIVE FLORIDA PURCHASERS. TO
ACCOMPLISH SUCH WITHDRAWAL, A FLORIDA RESIDENT NEED ONLY SEND A LETTER OR A
TELEGRAM TO THE COMPANY AT 000 XXXX XXXXXX XXXX, XXXXX 000, XXXXXXX, XXXXX 00000
INDICATING HIS OR HER INTENTION TO WITHDRAW. SUCH LETTER OR TELEGRAM MUST BE
SENT AND POSTMARKED PRIOR TO THE END OF THE APPLICABLE PERIOD NOTED ABOVE. IF A
LETTER IS SENT, IT IS PRUDENT TO SEND IT BY CERTIFIED MAIL, RETURN RECEIPT
REQUESTED, TO INSURE THAT IT IS RECEIVED AND ALSO TO EVIDENCE THE TIME AND DATE
OF MAILING. IF A FLORIDA RESIDENT MAKES THIS REQUEST ORALLY, HE OR SHE SHOULD
ASK FOR WRITTEN CONFIRMATION THAT THE REQUEST HAS BEEN RECEIVED.
THIS SUBSCRIPTION AGREEMENT AND INVESTMENT LETTER AND THE INFORMATION DOCUMENTS
HAVE NOT BEEN FILED WITH OR REVIEWED BY THE NEW JERSEY BUREAU OF SECURITIES OR
THE DEPARTMENT OF LAW AND PUBLIC SAFETY OF THE STATE OF NEW JERSEY PRIOR TO ITS
ISSUANCE AND USE. NEITHER THE ATTORNEY GENERAL NOR THE BUREAU OF SECURITIES OF
THE STATE OF NEW JERSEY HAS PASSED ON OR ENDORSED THE MERITS OF THIS OFFERING.
ANY REPRESENTATION TO THE CONTRARY IS UNLAWFUL.
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THIS SUBSCRIPTION AGREEMENT AND INVESTMENT LETTER AND THE INFORMATION DOCUMENTS
HAVE NOT BEEN REVIEWED BY THE ATTORNEY GENERAL OF THE STATE OF NEW YORK PRIOR TO
THEIR ISSUANCE AND USE. THE ATTORNEY GENERAL OF THE STATE OF NEW YORK HAS NOT
PASSED ON OR ENDORSED THE MERITS OF THIS OFFERING. ANY REPRESENTATION TO THE
CONTRARY IS UNLAWFUL.
THE UNDERSIGNED MAY NOT CONSTRUE THE INFORMATION DOCUMENTS OR ANY COMMUNICATIONS
IN CONNECTION THEREWITH AS LEGAL, TAX OR FINANCIAL ADVICE AND, ACCORDINGLY, MUST
CONSULT HIS OWN LEGAL, ACCOUNTING AND/OR FINANCIAL ADVISERS WITH RESPECT TO
LEGAL, TAX AND RELATED MATTERS CONCERNING THIS INVESTMENT.
NOTES SHOULD NOT BE PURCHASED BY ANY INVESTORS SEEKING TAX ADVANTAGES. THIS
INVESTMENT IS NOT A TAX SHELTER SINCE IT DOES NOT PROVIDE DEDUCTIONS WHICH WOULD
BE AVAILABLE TO REDUCE INCOME FROM OTHER SOURCES. ACCORDINGLY, A DECISION TO
PURCHASE THE NOTES SHOULD BE BASED SOLELY ON THE UNDERSIGNED'S EVALUATION OF THE
ECONOMIC CONSIDERATIONS OF THE TRANSACTION.
In connection with the subscription being made hereby the undersigned also
warrants and represents that:
(a) He has not received any general solicitation or advertising regarding
the Offering or been furnished with any oral representation or oral information
in connection with the Offering which is not set forth herein or in the
Information Documents;
(b) He has sufficient knowledge and experience of financial and business
matters so that he is able to evaluate the merits and risks of purchasing the
Note and has determined that the Note is a suitable investment for him;
(c) He has the means to provide for his personal needs, possesses the
ability to bear the economic risk hereunder indefinitely, and can afford a
complete loss of his investment;
(d) He has carefully read and reviewed this Subscription Agreement and
Investment Letter, the form of Note, and the other Information Documents, and
has asked such questions of the Company's management and received from them such
information as he deems necessary in order for him to make an informed decision
with respect to the purchase of the Note;
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(e) He understands the meaning of the 12th and 13th paragraphs of this
Subscription Agreement and Investment Letter and that the Company will prohibit
the transfer of the undersigned's Note and Underlying Shares absent full
compliance with the Securities Act, the Exchange Act and all applicable state
securities laws;
(f) He has had substantial experience in previous private and public
purchases of speculative securities and is not relying on the Company, the
Placement Agent and/or any of their respective affiliates or attorneys with
respect to economic or other considerations involved in this investment; and
(g) He has reviewed carefully the definition of "accredited investor" as
set forth below and is an "accredited investor" within that definition. The
particular subparagraph or subparagraphs by which the undersigned qualifies as
such is (are) filled in by him below.
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DEFINITION OF ACCREDITED INVESTOR
The undersigned represents that he is an "accredited investor" as that term is
defined in Rule 501 (a) of Regulation D promulgated under the Securities Act as
follows (CHECK APPLICABLE BOXES):
| | (a) Certain banks, savings and loan institutions,
broker-dealers, investment companies and other entities
including an employee benefit plan within the meaning of Title
I of the Employee Retirement Income Security Act of 1974 with
total assets in excess of $5,000,000; any private business
development company as defined in Section 202 (a) (22) of the
Investment Advisers Act of 1940; any organization described in
Section 501 (c) (3) of the Internal Revenue Code, not formed
for the specific purpose of acquiring the Units, with total
assets in excess of $5,000,000; any director, executive
officer or general partner of the issuer of the securities
being offered or sold, or any director, executive officer or
general partner of a general partner of that issuer; or any
trust with total assets in excess of $5,000,000 not formed for
the specific purpose of acquiring the securities offered,
whose purchase is directed by a sophisticated person as
described in Section 230.506 (b) (2) (ii) of Regulation D
| | (b) Any natural person whose individual net worth, or joint
net worth with that person's spouse, at the time of his
purchase exceeds $1,000,000;
| | (c) Any natural person who had an individual income in excess
of $200,000 or, with that person's spouse a joint income in
excess of $300,000 in each of the two most recent years and
who reasonably expects an income in excess of $200,000, or
$300,000 with that person's spouse, in the current year; or
| | (d) Any entity in which all of the equity owners are
accredited investors under any of the paragraphs above.
In connection with the foregoing representations the undersigned has appended
hereto as EXHIBIT A, a Purchaser Questionnaire which he has completed and
executed. He represents and warrants that the information set forth therein as
well as all other information which he is furnishing to the Company with respect
to his financial condition and business experience is accurate and complete as
of the date hereof and he covenants that, in the event a material change should
occur in such information, he will immediately provide the Company with such
revised or corrected information.
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All notices, requests, demands and other communications under this Subscription
Agreement shall be in writing and shall be deemed to have been given only when
delivered in person or, if mailed, when mailed by certified or registered mail
prepaid, to the parties at their respective addresses set forth herein, or at
such other address as my be given in writing in future by either party to the
other.
The undersigned acknowledges and agrees that:
(a) He has full power and authority to enter into this Agreement which,
upon his execution, will constitute a valid and legally binding obligation by
him;
(b) The Company may, in its sole discretion (i) reject this
Subscription Agreement in whole or in part; and (ii) accept subscription
agreements other than in the order received;
(c) If for any reason this Offering does not close or the undersigned's
subscription is not accepted by the Company, the undersigned shall have no
claims against the Company, the Placement Agent, or their respective officers,
directors, employees or affiliates and shall have no interest in the Notes,
Underlying Shares or the Company;
(d) Neither he nor any affiliate of his is an officer, director,
employee or affiliate of any member of the NASD;
(e) He shall indemnify and hold harmless the Company, the Placement
Agent and their respective officers, directors, employees, affiliates and
attorneys against any loss, liability, claim, damage or expense, (including, but
not limited to, any and all expenses reasonably incurred in investigating,
preparing or defending against any litigation commenced or threatened or any
claim) arising out of or based upon any false representation or warranty or
breach or failure by the undersigned to comply with any covenant or agreement
made by him herein or in any other document provided by him to any of the
foregoing in connection with this transaction;
(f) The representations, warranties and agreements made by the
undersigned set forth herein shall survive the closing of the Offering;
(g) Neither this Subscription Agreement nor any provisions hereof shall
be modified, discharged or terminated except by an instrument in writing signed
by the party against whom any waiver, change, discharge or termination is
sought;
(h) The laws of the State of Texas shall govern the interpretation and
enforcement of this Subscription Agreement. In the event of a dispute, the
undersigned agrees that any law suit brought to enforce or interpret the
provisions hereof shall be brought in state or federal courts, as appropriate,
in Xxxxxx County, Texas, and the undersigned agrees to submit to the personal
jurisdiction of such court;
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(i) This Subscription Agreement may be executed in counterparts, each
of which shall be deemed an original, but all of which shall constitute the same
instrument; and
(j) This Subscription Agreement constitutes the entire agreement of the
parties hereto, and supersedes all prior understandings with respect to the
subject matter hereof.
THE UNDERSIGNED ACKNOWLEDGES THAT THIS SUBSCRIPTION AGREEMENT CONSISTS OF PAGES
AND INCLUDES EXHIBITS A THROUGH L.
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A. SUBSCRIPTION;
Principal amount of Notes $_________________
B. MANNER IN WHICH TITLE IS TO BE HELD (Please check One):
1. | | Individual 7. | | Trust/Estate/Pension or
Profit Sharing Plan, and
date Opened:______________
2. | | Joint Tenants with Right of 8. | | As a Custodian for________
Survivorship __________________________
UGMA __________(State)
3. | | Community Property
4. | | Tenants in Common 9. | | Married with
Separate Property
5. | | Corporation/Partnership 10. | | Xxxxx
6. | | XXX 11. | | Tenants by the Entirety
12. Other _________________________________________________________________
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C. TITLE:
PLEASE GIVE THE EXACT AND COMPLETE NAME IN WHICH TITLE TO THE NOTES ARE TO BE
HELD:
IN WITNESS WHEREOF, the Subscriber has executed this Agreement on the ________
day of ________________, 1997.
Signature: ____________________ Signature: _____________________
Name: __________________________ Name: __________________________
Title (if applicable): _________________________________________________
Street Address: _______________________________________________________
City: ______________________ State: ___________ ZIP: __________
Telephone: (___) _____________________
Social Security or Federal Tax ID Number: _____________________________
***DO NOT WRITE BELOW DOTTED LINE***
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ACCEPTED ON BEHALF OF THE COMPANY:
FORTUNE NATURAL RESOURCES CORPORATION
BY: ________________________________ No. of Notes: ____________
Name: Xxxxxx X. Xxxxxxxxx Aggregate Principal
Title: President and Chief Amount of Note: __________
Executive Officer
