URON INC. SUBSCRIPTION AGREEMENT
THIS
SUBSCRIPTION
AGREEMENT (the
“Agreement”)
is
made on _________________, 2007, by and between URON Inc., a Minnesota
corporation (the “Company”),
and
__________________________ and
__________________________ (if joint investor) (referred to throughout the
remainder of this Agreement, whether singly or jointly, as the “undersigned”)
in
connection with the private placement offering (the “Offering”)
of up
to 2,953,125 shares of the Company’s common stock (the “Shares”)
at
$1.20 per share (without effect given to any subsequent stock combination
effected by the Company, in connection with any transaction involving Wyoming
Financial Lenders, Inc., a Wyoming corporation, as described in Section
7
below).
The undersigned understands and acknowledges that the Company has the right
to
reject any subscription, in whole or in part, for any reason, and that the
Company will promptly return the funds delivered herewith, without interest
or
deduction, if this subscription is rejected or if the Offering is otherwise
terminated. There is no minimum amount of proceeds that must be received
by the
Company prior to the Company accessing subscribers’ funds. Nevertheless,
proceeds related to subscriptions shall be placed in escrow with the Company’s
legal counsel pending one or more closings.
1. Subscription
for Shares.
Subject
to the terms hereinafter set forth, the undersigned hereby irrevocably
subscribes for and agrees to purchase from the
Company ______________
Shares
for a total of $ ____________________
(the
“Purchase
Price”).
Payment of the Purchase Price is being delivered by an enclosed check payable
to
the order of “URON Inc.” or wire transfer of immediately available funds to the
Company’s legal counsel (pursuant to wiring instructions that the undersigned
may request).
2. Issuance
of Shares and Certificates.
Upon
acceptance of this subscription and the closing of the Offering (or any part
of
the Offering to which this subscription relates), the Company will, subject
to
the provisions of Section 7
below,
record the undersigned as an owner of the Shares subscribed, and cause a
certificate representing the Shares to be delivered to the undersigned within
20
days of the termination date of the Offering. Pending the Company’s closing on
funds related to this subscription, proceeds will be placed in escrow with
the
Company’s legal counsel under the terms set forth in Section 8
below.
All Shares will be duly authorized, validly issued, fully paid and
non-assessable shares of the Company’s common stock. The undersigned hereby
authorizes the Company to issue a certificate representing the Shares in the
name and to the address set forth below:
______________________________________________________________________________
Print
name(s) of investor
______________________________________________________________________________
SSN(s)
or
federal TIN
______________________________________________________________________________
Mailing
address
______________________________________________________________________________
City State Zip
code
______________________________________________________________________________
Telephone
no. Fax
no.
______________________________________________________________________________
E-mail
address
3. Investor
Representations and Warranties.
By
executing and delivering this Agreement, the undersigned acknowledges, warrants
and represents to the Company as follows:
(a) The
undersigned has obtained and read (i) this Subscription Agreement, and (ii)
any
other documents specifically requested by the undersigned; and undersigned
has
also reviewed, or waived its opportunity to review, (iii) the Company’s most
recent annual report on Form 10-KSB filed with the SEC on April 17, 2007; most
recent quarterly report on Form 10-QSB filed with the SEC on November 20, 2007;
and all current reports on Form 8-K filed thereafter (all of the foregoing
documents referred to in this paragraph are hereinafter collectively referred
to
as the “Disclosure
Documents”).
(b) The
undersigned understands that an aggregate of 1,071,875 shares of common stock
will be sold to a single cash investor, who is also the Company’s current chief
executive officer, for an effective purchase price of $0.466 per share. The
undersigned also understands that funds relating to this subscription will
be
placed in escrow with the Company’s legal counsel pending closing pursuant to
the terms set forth in Section 8
below.
(c) The
undersigned has, either alone or with the assistance of a professional advisor,
sufficient knowledge and experience in financial and business matters that
the
undersigned believes himself, herself or itself capable of evaluating the merits
and risks of the prospective investment in the Shares and the suitability of
an
investment in the Company in light of the undersigned’s financial condition and
investment needs, and legal, tax and accounting matters.
(d) The
undersigned has been given access to full and complete information regarding
the
Company and has utilized such access to the undersigned’s satisfaction for the
purpose of obtaining information in addition to, or verifying information
included in, the Disclosure Documents. Particularly, the undersigned has been
given reasonable opportunity to meet with or contact Company representatives
for
the purpose of asking questions of, and receiving answers from, such
representatives concerning the terms and conditions of the Offering and to
obtain any additional information, to the extent reasonably available, necessary
to verify the accuracy of information provided in the Disclosure
Documents.
(e) The
undersigned is an “accredited investor” as defined in Rule 501(a) of Regulation
D promulgated under the Securities Act of 1933 (the “Securities
Act”). This
representation is based on the following factual representations hereby made
to
the Company (please check all
that
apply):
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The
undersigned has had an individual income in excess of $200,000 in
each of
the two most recent years or joint income with the undersigned’s spouse in
excess of $300,000 in each of the two most recent fiscal years, and
reasonably expect reaching the same income level in the current
year;
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As
of the date hereof, the undersigned (either individually or with
the
undersigned’s spouse) has a net worth exceeding
$1,000,000;
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The
undersigned is a corporation, partnership or Massachusetts or similar
business trust not formed for the specific purpose of acquiring the
Shares
and has total assets exceeding
$5,000,000;
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The
undersigned (or, in the case of a trust, the undersigned trustee)
is a
bank or savings and loan association as defined in Sections 3(a)(2)
and
3(a)(5)(A), respectively, of the Securities Act acting either in
the
undersigned’s individual or fiduciary
capacity;
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2
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The
undersigned is an insurance company as defined in Section 2(13) of
the
Securities Act, an investment company registered under the Investment
Company Act of 1940 or a business development company as defined
in
Section 2(a)(48) of that act or 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.
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The
undersigned is an employee benefit plan within the meaning of Title
I of
the Employee Retirement Income Security Act of 1974 (“ERISA”)
and either (check one or more, as
applicable):
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The
investment decision is made by a plan fiduciary, as defined in Section
3(21) of ERISA, which is either a bank, savings and loan association,
insurance company, or registered investment
adviser;
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·
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The
employee benefit plan has total assets in excess of $5,000,000;
or
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The
plan is a self directed plan with investment decisions made solely
by
persons who are “accredited investors” as defined under the Securities
Act.
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The
undersigned is a private business development company as defined
in
Section 202(a)(22) of the Investment Advisers Act of
1940.
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The
undersigned, if not an individual, is an entity all of whose equity
owners
meet one of the tests set forth in the paragraphs above (if relying
on
this category alone, the Company may in its discretion require each
equity
owner of the undersigned entity to complete a separate copy of this
Agreement).
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(f) The
undersigned acknowledges that an investment in the Shares involves a high degree
of risk, including but not limited to the risk of losing his, her or its entire
investment in the Company.
(g) The
undersigned acknowledges that no federal or state agency, including the SEC
or
the securities commission or authority of any state, has approved or disapproved
the Shares, passed upon or endorsed the merits of the Offering of the Shares
or
the accuracy or adequacy of the Disclosure Documents, or made any finding or
determination as to the fairness or fitness of the Shares for public
sale.
(h) The
undersigned has relied upon the advice of the undersigned’s legal counsel and
accountants or other financial advisors with respect to legal, tax and other
considerations relating to the purchase of Shares in the Offering. The
undersigned is not relying upon the Company with respect to the economic
considerations involved in making an investment decision with respect to the
Shares.
(i) The
undersigned is a bona
fide
resident
of (or, if an entity, is organized or incorporated under the laws of, and is
domiciled in), and received the offer and decided to invest in the Shares in,
the state or jurisdiction set forth as the undersigned’s mailing address in
Section 1 above.
4. Investment
Purpose.
The
undersigned represents and warrants that it is the undersigned’s intention to
acquire the Shares for the account of the undersigned, for investment purposes
and not with a view to the resale of the Shares in connection with any
distribution thereof. To assure the Company that the undersigned has no present
intention to resell or dispose of the Shares acquired in the Offering, the
undersigned further represents and warrants to
the
Company as follows:
(a) The
undersigned intends to receive and hold the Shares for the undersigned’s
personal account, and has no contract, undertaking, agreement or arrangement
with any person or entity to sell or otherwise transfer the Shares to any such
person or entity or to have any such person or entity sell the Shares on the
undersigned’s behalf.
3
(b) The
undersigned has no need for immediate liquidity with respect to his, her or
its
investment and has sufficient income to meet the undersigned’s current and
anticipated obligations. The loss of the undersigned’s entire investment in the
Shares would not cause financial hardship to the undersigned and would not
adversely affect the undersigned’s current standard of living. In addition, the
overall commitment of the undersigned to investments that are not readily
marketable is not disproportionate to the undersigned’s net worth and the
undersigned’s investment in the Shares will not cause such overall commitment to
become excessive.
(c) The
undersigned is not aware of any occurrence, event or circumstance upon the
happening of which the undersigned intends to transfer or sell the Shares and
the undersigned does not have any present intention to transfer or sell the
Shares after a lapse of any particular period of time.
(d) The
undersigned has been informed that, in the view of the SEC and certain state
securities commissions, a purchase of the Shares with a current intent to
resell, by reason of any foreseeable specific contingency or anticipated change
in market values, any change in the condition of the Company or the investment
market as a whole, or in connection with a contemplated liquidation or
settlement of any loan obtained for the acquisition of the Shares, would
represent a purchase with an intent inconsistent with the representations set
forth above, and that the SEC and certain state securities commissions might
regard such sale or disposition as a deferred sale with regard to which an
exemption from registration is not available.
(e) If
other
than an individual, the undersigned represents and warrants that (i) it was
not
organized for the specific purpose of acquiring the Shares, and (ii) this
Agreement has been duly authorized by all necessary action on the part of the
undersigned, has been duly executed by an authorized officer or representative
of the undersigned, and is a legal, valid and binding obligation of the
undersigned enforceable in accordance with its terms.
5. Registration
Status; Restrictions on Transferability.
With
respect to the registration status and transferability of the Shares (in
addition to Section 4 above), the undersigned understands, acknowledges and
agrees that:
(a) Neither
the offer nor the sale of the Shares to be issued in connection with this
subscription and the Offering have been, or will have been, registered under
the
Securities Act or under applicable state securities laws on the grounds that
they are being issued in a transaction (i) involving a limited group of
knowledgeable investors fully familiar with the proposed operations of the
Company and (ii) not involving a public offering and that, consequently, such
transaction is exempt from registration under the Securities Act and applicable
state securities laws. The Company will rely on the undersigned’s
representations herein as a basis for the exemption from the Securities Act’s
registration requirements.
(b) The
Shares may not be sold, transferred or otherwise disposed of except pursuant
to
an effective registration statement or appropriate exemption from registration
under applicable state law and, as a result, the undersigned may be required
to
hold the Shares for an indefinite period of time. In addition to customary
legends that may be required under state law, certificates representing the
Shares will bear a legend substantially in the following form:
THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933 OR THE SECURITIES LAW OF ANY STATE. SUCH SECURITIES
HAVE
BEEN ACQUIRED FOR INVESTMENT AND WITHOUT A VIEW TO THEIR DISTRIBUTION AND MAY
NOT BE SOLD OR OTHERWISE DISPOSED OF IN THE ABSENCE OF ANY EFFECTIVE
REGISTRATION STATEMENT FOR SUCH SECURITIES UNDER THE SECURITIES ACT OF 1933
AND
UNDER APPLICABLE STATE SECURITIES LAWS, UNLESS AN EXEMPTION FROM REGISTRATION
IS
AVAILABLE UNDER APPLICABLE SECURITIES LAWS.
4
(c) The
Company will use commercially reasonable efforts to prepare and file, within
60
days after the closing of the currently anticipated merger transaction involving
the Company and Wyoming Financial Lenders, Inc., a registration statement on
Form SB-2 (or other available and appropriate form) with the SEC. The
registration statement will seek to register the resale of the Shares offered
and sold to the undersigned pursuant to this Agreement; provided,
however,
that
the Company may cutback the number of Shares the resale of which is proposed
to
be registered under the registration statement to the extent the Company
reasonably deems necessary to comply with SEC Rule 415, interpretations thereof
proponed by SEC staff, or for any other reason relating to the Company’s
compliance with federal and state securities laws. The Company will use
commercially reasonable efforts to obtain the effectiveness of the registration
statement within 60 days of its filing; provided,
however,
that
if, after the 60th day after such filing, the SEC provides to the Company
further comments relating to the registration statement, the Company shall
have
the right to withdraw such registration statement so long as a majority of
the
shares of common stock sold in the Offering shall, as of the date of withdrawal,
become available for resale under Rule 144 within a 90-day period thereafter.
If
the registration statement is declared effective by the SEC, then the Company
will use commercially reasonable efforts to maintain the effectiveness of the
registration statement for such period of time until at least a majority of
the
Shares offered and sold in the Offering may be resold under Rule 144. As a
condition to the obligations of the Company to prepare and file a registration
statement covering the resale of Shares purchased hereunder by the undersigned,
the undersigned agrees to furnish the Company with such information as may
be
reasonably required in connection with the preparation and filing of the
registration statement, and in connection with the Company’s responses to SEC
comments. Furthermore, the undersigned agrees to comply with the provisions
of
the plan of distribution set forth in the final prospectus forming a part of
the
registration statement.
(d) All
fees
and expenses incident to the Company’s performance of or compliance with the
covenants of the Company contained in paragraph (c)
above
shall be borne by the Company. Such fees and expenses shall include without
limitation (i) all registration and filing fees, (ii) printing expenses, (iii)
messenger, telephone and delivery expenses, (iv) fees and disbursements of
counsel for the Company, and (v) fees and expenses of all other persons and
firms retained by the Company in connection with its performance of the
obligations set forth in paragraph (c)
above.
In addition, the Company shall be responsible for all of its internal expenses
incurred in connection with its performance of such obligations. In no event,
however, shall the Company be responsible for any broker or similar commissions
incurred by the undersigned or any of the undersigned’s legal fees or other
costs associated with the offer, purchase, and subsequent re-offer and resale
of
the Shares.
5
6. Dispute
Resolution.
(a) To
the
greatest extent possible, the parties will endeavor to resolve any disputes
relating to this Agreement and this subscription through amicable negotiations.
Failing an amicable settlement, any controversy, claim or dispute arising under
or relating to this Agreement, including the existence, validity,
interpretation, performance, termination or breach of this Agreement, will
finally be settled by binding arbitration before a single arbitrator
(the “Arbitration
Tribunal”)
which
will be jointly appointed by the parties. The Arbitration Tribunal shall
self-administer the arbitration proceedings utilizing the Commercial Rules
of
the American Arbitration Association; provided,
however,
the
American Arbitration Association shall not be involved in administration of
the
arbitration. The arbitrator must be a retired judge of a state or federal court
of the United States or a licensed lawyer with at least ten years of corporate
or commercial law experience and have at least an AV rating by Martindale
Xxxxxxx. If the parties cannot agree on an arbitrator, either party may request
the American Arbitration Association to appoint an arbitrator which appointment
will be final.
(b) The
arbitration will be held in Minneapolis, Minnesota. Each party will have
discovery rights as provided by the Federal Rules of Civil Procedure within
the
limits imposed by the arbitrator; provided,
however,
that
all such discovery will be commenced and concluded within 60 days of the
selection of the arbitrator. It is the intent of the parties that any
arbitration will be concluded as quickly as reasonably practicable. Once
commenced, the hearing on the disputed matters will be held four days a week
until concluded, with each hearing date to begin at 9:00 a.m. and to conclude
at
5:00 p.m. The arbitrator will use all reasonable efforts to issue the final
written report containing award or awards within a period of five business
days
after closure of the proceedings. Failure of the arbitrator to meet the time
limits of this Article will not be a basis for challenging the award. The
Arbitration Tribunal will not have the authority to award punitive damages to
either party. Each party will bear its own expenses, but the parties will share
equally the expenses of the Arbitration Tribunal. The Arbitration Tribunal
shall
award attorneys’ fees and other related costs payable by the losing party to the
successful party as it deems equitable. This Agreement will be enforceable,
and
any arbitration award will be final and non-appealable, and judgment thereon
may
be entered in any court of competent jurisdiction.
7. Effect
of Subsequent Stock Combination.
The
Shares purchased hereunder shall not be affected by, and shall for all purposes
be considered issued subsequent to, the effectuation of any stock combination
(i.e., reverse stock split) of the Company in any way connected with a
transaction involving the Company and Wyoming Financial Lenders, Inc., a Wyoming
corporation. Accordingly, and to effectuate the intent of this Section, the
Company may delay the book entry and issuance of the Shares (and corresponding
certificates) until such time as it shall have effected such a stock combination
(but in no event may such book entry and issuance be delayed more than six
weeks); provided,
however,
that if
the Company’s shareholders shall, during the period of any such delay permitted
by this Section, become entitled to vote or entitled to receive any distribution
upon their shares of Company capital stock, the Company shall for all such
purposes treat the Shares as issued and outstanding.
8. Escrow
with Legal Counsel.
Until
no later than March 30, 2008, Xxxxxx Xxxxxxx Xxxxxx & Brand, LLP, the
Company’s legal counsel (serving as “escrow agent”), will pay out escrowed funds
relating to subscriptions in this Offering when and as directed in writing
by
the officers of the Company. The sole duty of the escrow agent shall be to
receive said funds and hold them subject to release, in accordance herewith,
and
the escrow agent shall be under no duty to determine whether the Company is
complying with any requirements or conditions relating to its access to funds
from the sale of securities hereunder. The escrow agent may conclusively rely
upon and shall be protected in acting upon any statement, certificate, notice,
request, consent, order or other document believed by it to be genuine and
to
have been signed or presented by the proper party or parties. The escrow agent
shall have no duty or liability to verify any such statement, certificate,
notice, request, consent, order or other document, and its sole responsibility
shall be to act only as expressly set forth herein. The escrow agent shall
be
under no obligation to institute or defend any action, suit or proceeding in
connection herewith unless first indemnified to its satisfaction. The escrow
agent shall not be liable for any action taken or omitted in good faith. The
escrow agent is acting solely as escrow agent hereunder and owes no duties,
covenants or obligations, fiduciary or otherwise, to any other person by reason
of this arrangement, except as otherwise stated herein, and no implied duties,
covenants or obligations, fiduciary or otherwise, shall be read into this
arrangement against the escrow agent. In the event of any disagreement between
the Company and any investor in this Offering resulting in adverse claims or
demands being made in connection with the matters covered by this Agreement,
or
in the event that the escrow agent is in doubt as to what action it should
take
hereunder, the escrow agent may, at its option, refuse to comply with any claims
or demands on it, or refuse to take any other action hereunder, so long as
such
disagreement continues or such doubt exists, and in any such event, the escrow
agent shall not be or become liable in any way or to any person for its failure
or refusal to act, and the escrow agent shall be entitled to continue so to
refrain from acting until (i) the rights of all interested parties shall have
been fully and finally adjudicated by a court of competent jurisdiction, or
(ii)
all differences shall have been adjudged and all doubt resolved by agreement
among all of the interested persons, and the escrow agent shall have been
notified thereof in writing signed by all such persons. Notwithstanding the
foregoing, the escrow agent may in its discretion obey the order, judgment,
decree or levy of any court, whether with or without jurisdiction and the escrow
agent is hereby authorized in its sole discretion to comply with and obey any
such orders, judgments, decrees or levies. In the event that any controversy
should arise with respect to this Agreement the escrow agent shall have the
right, at its option, to institute an interpleader action in any court of
competent jurisdiction to determine the rights of the parties. In no event
shall
the escrow agent be liable, directly or indirectly, for any special, indirect
or
consequential losses or damages of any kind whatsoever (including without
limitation lost profits), even if the escrow agent has been advised of the
possibility of such losses or damages and regardless of the form of action.
Escrow agent may resign upon ten days advance written notice to the Company.
If
a successor escrow agent is not appointed within the ten-day period following
such notice, escrow agent may petition any court of competent jurisdiction
to
name a successor escrow agent or interplead the funds from subscribers then
in
its possession with such court, whereupon escrow agent’s duties hereunder shall
terminate. The escrow agent shall be a third-party beneficiary to the provisions
of this Section 8.
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9. Indemnification.
The
Company hereby indemnifies, defends and holds harmless the escrow agent from
and
against any and all loss, liability, cost, damage and expense, including,
without limitation, reasonable counsel fees which the escrow agent may suffer
or
incur by reason of any action, claim or proceeding brought against the escrow
agent, arising out of or relating in any way to this Agreement or any
transaction to which this Agreement relates, unless such action, claim or
proceeding is the result of the willful misconduct of the escrow agent. The
provisions of this section shall survive the termination of this Agreement
and
any resignation or removal of the escrow agent.
10. General
Provisions.
From
and after the date of the Company’s acceptance of this subscription, as set
forth on the signature page hereto, this Agreement shall remain in effect until
such time as (a) the undersigned has performed the full subscription by
delivering full payment of the aggregate Purchase Price for the Shares
referenced above and set forth on the signature page hereto, and (b) the Company
has fulfilled its obligation to the undersigned by recording the undersigned
as
the owner of the appropriate number of Shares in its required records and
delivering a certificate representing the Shares pursuant to Section
1.
The
covenants made in Section 6
shall be
construed as an agreement independent of any other provision of this Agreement,
and shall survive the termination of this Agreement, together with the
provisions of this Section relating to severability, waiver, binding effect
and
governing law. Furthermore, the representations and warranties of the
undersigned shall survive the termination of this Agreement. If any provision
of
this Agreement or the application of such provision to any party or
circumstances shall be held invalid, the remainder of the Agreement, or the
application of such provision to such party or circumstances other than those
to
which it is held invalid, shall not be affected thereby. This Agreement may
be
modified or amended only by a written instrument signed by both the Company
and
the undersigned. No
failure or delay by either the Company or the undersigned in exercising or
enforcing any right or remedy under this Agreement will waive any provision
of
the Agreement. Nor will any single or partial exercise by either the Company
or
the undersigned of any right or remedy under this Agreement preclude either
of
them from otherwise or further exercising these rights or remedies, or any
other
rights or remedies granted by any law or any related document. Upon
acceptance by the Company, this Agreement shall be binding upon and shall inure
to the benefit of the Company and the undersigned and to the successors and
assigns of the Company and to the personal and legal representatives, heirs,
guardians, successors and permitted assignees of the undersigned. This Agreement
shall be governed by and construed in accordance with the laws of the State
of
Minnesota without regard to the conflicts-of-law principles thereof. The venue
for any action hereunder shall be in the State of Minnesota, whether or not
such
venue is or subsequently becomes inconvenient, and the parties consent to the
jurisdiction of the courts of the State of Minnesota, County of Hennepin, and
the U.S. District Court, District of Minnesota. This Agreement constitutes
the
entire agreement among the parties with respect to the Company. It supersedes
any prior agreement or understanding among them, and it may not be modified
or
amended in any manner other than as set forth herein. Upon request, the
undersigned agrees to furnish to the Company such additional information as
may
be deemed necessary to determine the undersigned’s suitability as an investor.
This Agreement may be executed in counterparts, which taken together shall
constitute one agreement binding on the parties hereto. Facsimile and
electronically transmitted signatures shall be valid and binding to the same
extent as original signatures. In making proof of this Agreement, it will be
necessary to produce only one copy signed by the party to be
charged.
* * * * *
7
SUBSCRIPTION
AGREEMENT - SIGNATURE PAGE
In
WITNESS
WHEREOF,
the
undersigned has executed this Subscription Agreement as of
_____________________, 2007.
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Individuals:
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Entities:
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Signature
of investor
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Name
of entity
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Signature
of joint investor
|
Authorized
signature
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Print
name
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Its:
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Form
of
ownership for individual investors (check one):
________________
Individual ownership _______________Tenants
in common
________________
Joint tenants (JTWROS)________________
Individual ownership pursuant to a purchase under
the
Uniform Gift to Minors
Act
Other:
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
ACKNOWLEDGED
AND ACCEPTED:
URON
INC.:
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| By: __________________________________________ |
Dated
|
| Title: _________________________________________ |
