EXHIBIT 10.15
UTG COMMUNICATIONS INTERNATIONAL, INC.
SUBSCRIPTION AGREEMENT
UTG Communications International, Inc.
c/o Xxxxx Xxxx Xxxxx Constant & Xxxxxxxx
00 Xxxxxxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Gentlemen:
I. SUBSCRIPTION. The undersigned, intending to be legally bound, hereby
irrevocably agrees to purchase from UTG Communications International, Inc. a
Delaware corporation (the "Company"), 2,000,000 shares of the Company's Common
Stock, par value $.00001 ("Shares") set forth on the signature page hereof, at a
purchase price of $1.00 per Share. This subscription is submitted to the Company
in accordance with and subject to the terms and conditions described in this
Subscription Agreement relating to the offering by the Company of 2,000,000
Shares.
II. PAYMENT. The undersigned will pay for the subscription by check payable in
U.S. dollars or by wire transfer in U.S. dollars to the Company's designated
account payable $500,000 on or before January 31, 1997 and the balance in at
least equal monthly installments on the last day of each following month with
the final installment to be paid no later than April 30, 1996. With each
payment a portion of the Shares shall be issued.
III. ACCEPTANCE OF SUBSCRIPTION. The undersigned understands and agrees that the
Company in its sole discretion reserve the right to accept or reject this or any
other subscription for Shares, in whole or in part, notwithstanding prior
receipt by the undersigned of notice of acceptance of this subscription. The
Company shall have no obligation hereunder until the Company shall execute and
deliver to the undersigned an executed copy of this Subscription Agreement. If
this subscription is rejected in whole, this Subscription Agreement and all
funds received from the undersigned will be returned without interest or
deduction, and this Subscription Agreement shall thereafter be of no further
force or effect. If this subscription is rejected in part, the funds for such
rejected portion of this subscription will be returned without interest or
deduction, and this Subscription Agreement shall continue in force and effect to
the extent this subscription was accepted.
IV. REPRESENTATIONS AND WARRANTIES. The undersigned hereby acknowledges,
represents, warrants to and agrees with each of the Company as follows:
(a) None of the Shares are registered under the Securities Act of
1933 (the "Securities Act") or any state securities laws. The
undersigned understands that the offering and sale of the Shares is
intended to be exempt from registration under the Securities Act of
1933 (the "Securities Act"), by virtue of Section 4(2) and the
provisions of Regulation D promulgated thereunder, based, in part,
upon the representations, warranties and agreements contained in this
Subscription Agreement;
(b) The undersigned has access to the same kind of information which
would be available in registration statements filed by the Company
under the Securities Act;
(c) The undersigned is aware that an investment in the Shares
involves a number of very significant risks and the undersigned is
able to bear the loss of the entire investment in the Shares;
(d) Neither the Securities and Exchange Commission nor any state
securities commission has approved any of the securities included in
the Shares offered or passed upon or endorsed the merits of the
offering;
(e) The undersigned acknowledges that all documents, records, and
books pertaining to the investment in the Shares have been made
available for inspection by him, his attorney, accountant, purchaser
representative or tax advisor (collectively, the "Advisors");
(f) The undersigned and the Advisors 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
Shares and all such questions have been answered to the full
satisfaction of the undersigned and his Advisors;
(g) In evaluating the suitability of an investment in the Company,
the undersigned has not relied upon any representation or other
information (oral or written) other than as contained in documents or
answers to questions so furnished to the undersigned or his Advisors
by the Company;
(h) The undersigned is unaware of, and in no way relying on, any form
of general solicitation or general advertising in connection with the
offer and sale of the Shares;
(i) The undersigned has such knowledge and experience in financial,
tax, and business matters so as to enable him to utilize the
information made available to him in connection with the offering of
the Shares to evaluate the merits and risks of an investment in the
Shares and to make an informed investment decision with respect
thereto;
(j) The undersigned is not relying on the Company respecting the tax
and other economic considerations of an investment in the Shares, and
the undersigned has relied on the advice of, or has consulted with,
only his own Advisors;
(k) The undersigned is acquiring the Shares solely for his own
account for investment and not with a view to resale or distribution
and the Subscriber will not sell or transfer the Shares until they are
registered for resale under the Securities Act;
(l) The undersigned must bear the economic risk of the investment
indefinitely because none of the Shares may be sold, hypothecated or
otherwise disposed of unless subsequently registered under the Act and
applicable state securities laws or an exemption from registration is
available. Legends shall be placed on the Shares to the effect that
they have not been registered under the Securities Act or applicable
state securities laws and appropriate notations thereof will be made
in each of the Company' stock books;
(m) The undersigned has adequate means of providing for the
undersigned's current needs and foreseeable personal contingencies and
has no need for the undersigned's investment in the Shares to be
liquid;
(n) The undersigned has completed accurately the Subscriber
Questionnaire attached hereto as Annex A and meets the requirements of
at least one of the suitability standards for an "accredited
investor;"
(o) The undersigned:1. if a natural person represents that the
undersigned has reached the age of 21 and has full power and authority
to execute and deliver this Subscription Agreement and all other
related agreements or certificates and to carry out the provisions
hereof and thereof;2. if a corporation, partnership, association,
joint stock company, trust, unincorporated organization or other
entity represents that such entity was not formed for the specific
purpose of acquiring the Shares, such entity is validly existing under
the laws of the state of its organization, the consummation of the
transactions contemplated hereby is authorized by, and will not result
in a violation of state law or its charter or other organizational
documents, such entity has full power and authority to execute and
deliver this Subscription Agreement and all other related agreements
or certificates and to carry out the provisions hereof and thereof,
this Subscription Agreement has been duly authorized by all necessary
action, this Subscription Agreement has been duly executed and
delivered on behalf of such entity and is a legal, valid and binding
obligation of such entity; and 3. if executing this Subscription
Agreement in a representative or fiduciary capacity, represents that
it has full power and authority to execute and deliver this
Subscription Agreement in such capacity and on behalf of the
subscribing individual, xxxx, partnership, trust, estate, corporation,
or other entity for whom the undersigned is executing this
Subscription Agreement, and such individual, xxxx, partnership, trust,
estate, corporation, or other entity has full right and power to
perform pursuant to this Subscription Agreement and make an investment
in the Company, and that this Subscription Agreement constitutes a
legal, valid and binding obligation of such entity; and
V. INDEMNIFICATION. The undersigned agrees to indemnify and hold harmless
each of the Company, their respective officers, directors, employees, agents,
and affiliates against all losses, liabilities, claims, damages, and expenses
(including, but not limited to, any and all expenses incurred in investigating,
preparing, or defending against any litigation commenced or threatened) arising
out of any false representation or warranty or breach by the undersigned of any
agreement herein or in any other document delivered in connection with this
Subscription Agreement.
VI. IRREVOCABILITY; BINDING EFFECT. The undersigned hereby acknowledges and
agrees that the subscription hereunder is irrevocable by the undersigned, except
as required by applicable law, and that this Subscription Agreement shall
survive the death or disability of the undersigned and shall be binding upon and
inure to the benefit of the parties and their heirs, executors, administrators,
successors, legal representatives, and permitted assigns. If the undersigned is
more than one person, the obligations of the undersigned hereunder shall be
joint and several and the agreements, representations, warranties, and
acknowledgments herein shall be deemed to be made by and be binding upon each
such person and his heirs, executors, administrators, successors, legal
representatives, and permitted assigns.
VII. MODIFICATION. This Subscription Agreement shall not be modified or
waived except by an instrument in writing signed by the party against whom any
such modification or waiver is sought.
VIII. NOTICES. Any notice or other communication required or permitted to be
given hereunder shall be in writing and shall be mailed by certified mail,
return receipt requested, or delivered against receipt to the party to whom it
is to be given (a) if to either of the Company, at the address set forth above,
or (b) if to the undersigned, at the address set forth on the signature page
hereof
(or, in either case, to such other address as the party shall have furnished in
writing in accordance with the provisions of this Section IX). Any notice or
other communication given by certified mail shall be deemed given at the time of
certification thereof, except for a notice changing a party's address which
shall be deemed given at the time of receipt thereof.
IX. ASSIGNABILITY. This Subscription Agreement and the rights and
obligations hereunder are not transferable or assignable by the undersigned.
X. APPLICABLE LAW. This Subscription Agreement shall be governed by and
construed in accordance with the internal laws of the State of New York
without regard to its conflicts of laws principles.
XI. BLUE SKY QUALIFICATION. My right to purchase Shares under this
Subscription Agreement are expressly conditioned upon the exemption from
qualification of the offer and sale of the Shares from applicable Federal and
state securities laws. The Company shall not be required to qualify this
transaction under the securities laws of any jurisdiction and, should
qualification be necessary, the Company shall be released from any and all
obligations to maintain its offer, and may rescind any sale contracted, in
the jurisdiction.
XII. REGISTRATION OF THE SHARES.
(a) The Company hereby agrees that within thirty days from the last
date of purchase, it will file a registration statement (the "REGISTRATION
STATEMENT") under the Securities Act with the SEC, naming the Subscriber as a
selling stockholder. The Subscriber is referred to herein as the "HOLDER."
(b) Once filed, the Company will use its best efforts to cause the
Registration Statement to become effective as promptly as possible and, if any
stop order shall be issued by the SEC in connection therewith, to use its
reasonable efforts to obtain the removal of such order. Following the effective
date of the Registration Statement, the Company shall, upon the request of the
Holder, forthwith supply such reasonable number of copies of the Registration
Statement, prospectus and other documents necessary or incidental to the
registration as shall be reasonably requested by the Holder to permit the Holder
to make a public distribution of such Holder's Shares. The Company will use its
reasonable efforts to qualify the Shares for sale in such states as the Holder
shall reasonably request, provided that no such qualification will be required
in any jurisdiction where, solely as a result thereof, the Company would be
subject to general service of process or to taxation or qualification as a
foreign corporation doing business in such jurisdiction. The obligations of the
Company hereunder with respect to the Shares of the Holder are expressly
conditioned on the Holder furnishing to the Company such appropriate information
concerning the Holder, the Holder's Shares and the terms of the Holder's
offering of such Shares as the Company may reasonably request.
(c) The Company shall bear the entire cost and expense of the
registration of the Shares; provided, however, that the Holder shall be solely
responsible for the fees of any counsel retained by the Holder in connection
with such registration and any transfer taxes or underwriting discounts,
commissions or fees applicable to the Shares sold by the Holder pursuant
thereto.
(d) Neither the filing of the Registration Statement by the Company
pursuant to this Subscription Agreement nor the making of any request for
prospectuses by any Holder shall impose upon any Holder any obligation to sell
the Holder's Shares.
(e) The Holder, upon receipt of notice from the Company that an event
has occurred which requires a post-effective amendment to the Registration
Statement or a supplement to the prospectus included therein, shall promptly
discontinue the sale of Shares until the Holder receives a copy of a
supplemented or amended prospectus from the Company, which the Company shall
provide as soon as practicable after such notice.
(f) The Company shall indemnify and hold harmless the Holder from and
against any and all losses, claims, damages and liabilities caused by any untrue
statement of a material fact contained in the Registration Statement, any other
registration statement filed by the Company under the Securities Act, any post-
effective amendment to such registration statements, or any prospectus included
therein required to be filed or furnished by reason of this Subscription
Agreement or caused by any omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not misleading,
except, with respect to the Holder, insofar as such losses, claims, damages or
liabilities are caused by any such untrue statement or omission based upon
information furnished or required to be furnished in writing to the Company by
the Holder expressly for use therein, which indemnification shall include each
person, if any, who controls the Holder within the meaning of the Securities Act
and each officer, director, employee and agent of the Holder; provided, however,
that the indemnification in this paragraph (c) with respect to any prospectus
shall not inure to the benefit of the Holder (or to the benefit of any person
controlling the Holder) on account of any such loss, claim, damage or liability
arising from the sale of Shares by the Holder, if a copy of a subsequent
prospectus correcting the untrue statement or omission in such earlier
prospectus was provided to the Holder by the Company prior to the subject sale
and the subsequent prospectus was not delivered or sent by the Holder to the
purchaser prior to such sale; and provided further, that the Company shall not
be obligated to so indemnify the Holder or other person referred to above unless
the Holder or other person, as the case may be, shall at the same time indemnify
the Company, its directors, each officer signing the Regis-
tration Statement and each person, if any, who controls the Company within the
meaning of the Securities Act, from and against any and all losses, claims,
damages and liabilities caused by any untrue statement of a material fact
contained in the Registration Statement, any registration statement or any
prospectus required to be filed or furnished by reason of this Subscription
Agreement or caused by any omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not misleading,
insofar as such losses, claims, damages or liabilities are caused by any untrue
statement or omission based upon information furnished in writing to the Company
by the Holder expressly for use therein.
(g) If for any reason the indemnification provided for in the
preceding subparagraph is held by a court of competent jurisdiction to be
unavailable to an indemnified party with respect to any loss, claim, damage,
liability or expense referred to therein, then the indemnifying party, in lieu
of indemnifying such indemnified party thereunder, shall contribute to the
amount paid or payable by the indemnified party as a result of such loss, claim,
damage or liability in such proportion as is appropriate to reflect not only the
relative benefits received by the indemnified party and the indemnifying party,
but also the relative fault of the indemnified party and the indemnifying party,
as well as any other relevant equitable considerations.
XIII. FURTHER CONDITION. This Subscription Agreement shall only be
enforceable against the Subscriber when, and if, the obligations of Xxx
Xxxxxxxxx to transfer to the Subscriber without further consideration, an
additional 2,000,000 shares of the Common Stock owned by Xxx Xxxxxxxxx. Such
shares shall be delivered on a pro rata basis one share for each share
purchased. Until such transfer has been effected, any amounts paid by the
Subscriber to the Company shall be held in escrow.
XIV. COUNTERPARTS. This Subscription Agreement may be executed in any
number of counterparts, all of which taken together shall constitute one and the
same instrument and any of the parties hereto may execute this subscription by
signing any of such counterpart and delivering the same by telex, telecopy,
telegraph, cable or otherwise in writing (each delivery by any of such means to
be deemed to be "in writing" for purposes of this Subscription Agreement).
XV. USE OF PRONOUNS. All pronouns and any variations thereof used herein
shall be deemed to refer to the masculine, feminine, neuter, singular or plural
as the identity of the person or persons referred to may require.
IN WITNESS WHEREOF, the undersigned has executed this Subscription
Agreement this 15th day of January, 1997.
Number of Shares Subscribed 2,000,000
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Total Subscription Amount 2,000,000
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If the purchaser is a PARTNERSHIP, CORPORATION, or TRUST:
Interfinance Inv. Co. Ltd
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Name of Partnership, Corporation or Trust
By: /s/ Xxxxxx Xxxxx
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Name:
Title:
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Taxpayer Identification Number
Interfinance Inv. Co. Ltd. - Attn: Xxxxxx Xxxxx
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Xxxxxxx 00, Xxxxxxxxxxxxxxx 0, Xx-0000, Xxxxxxxxxx, Xxxxxxxxxxx
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Address
If the purchaser is an individual:
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Name (Print Below)
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Taxpayer Identification Number
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Address
ACCEPTED AND AGREED
UTG Communications International, Inc.
By: /s/ Xxx Xxxxxxxxx/Xxxxx X. Xxxxxxxx
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Name:
Title:
Date: January 15, 1997
