STOCK PURCHASE AGREEMENT AND REPRESENTATIONS
STOCK
PURCHASE AGREEMENT AND REPRESENTATIONS
This stock purchase agreement ("Agreement"), along with the Signature Page and
Questionnaire attached hereto, and by this reference incorporated herein, is
made effective _________________________ by and between XsunX, a Colorado
corporation ("XsunX") and the purchaser(s) signatory hereto (“Private
Purchaser”). XsunX has received an offer to purchase certain shares
of common voting stock ("Shares") of XsunX by Private Purchaser, and XsunX and
Private Purchaser agree as set forth herein and represent to each other with
regard thereto as follows:
1. XsunX
is a duly organized Colorado corporation. The Articles of
Incorporation of XsunX were filed on February 25, 1997. XsunX is
authorized by its Articles of Incorporation to issue up to 500,000,000 shares of
common voting stock, par value $.00 per share, of which approximately
___________ shares are outstanding as of the date hereof.
2. Neither
XsunX nor any of its officers, directors, employees, agents or representatives
have made any representation or statement of opinion regarding the value of
XsunX or the Shares, Private Purchaser is purchasing the Shares purely on a
speculative basis and confirms that Private Purchaser has been given no reason
to believe that Private Purchaser will receive any return on the purchase of
Shares.
3. Private
Purchaser has offered to purchase the number of Shares at a price per share set
forth on the Signature Page and Questionnaire which is attached hereto,
incorporated herein, and made a part hereof, for a total purchase price as set
forth on the Signature Page and Questionnaire. The purchase price
shall be payable in cash or cash equivalent representing immediately available
funds to the satisfaction of XsunX. Private Purchaser shall pay the
purchase price prior to the issuance of the Shares. The Shares may be
sold from authorized but unissued shares of XsunX, or treasury shares held by
XsunX.
4. Private
Purchaser understands that Private Purchaser must bear the economic risk of the
investment for an indefinite period of time because the Shares will be
restricted and no public market will exist for the Shares. Private
Purchaser understands the speculative nature of investment in XsunX and that
Private Purchaser could lose Private Purchaser's entire purchase price
payment.
5. Private
Purchaser represents that it has been called to Private Purchaser's attention
that Private Purchaser's proposed investment in XsunX involves a high degree of
risk which may result in the loss of the total amount of that
investment.
6. Private
Purchaser acknowledges that XsunX has made available to Private Purchaser or
Private Purchaser's personal advisors the opportunity to obtain any and all
information required to evaluate the merits and risks of purchase of the Shares,
and that XsunX has, prior to the sale of the Shares, accorded Private Purchaser
and Private Purchaser's representative, if any, the opportunity to ask questions
and receive answers concerning the terms and conditions of the proposed purchase
and to obtain any additional information necessary to evaluate the merits and
risks of the purchase of the Shares.
7. Private
Purchaser and (if applicable) Private Purchaser's personal advisors and
representatives have had an opportunity to ask questions of and receive
satisfactory answers from XsunX, or any person or persons acting on XsunX's
behalf, concerning the terms and conditions of Private Purchaser's proposed
investment in XsunX, and all such questions have been answered to the complete
satisfaction of Private Purchaser.
8. Private
Purchaser represents that all of the information provided by Private Purchaser
or Private Purchaser's representatives to XsunX is true, correct, accurate and
current and that Private Purchaser is not subject to backup
withholding. Private Purchaser specifically represents that all of
the information provided on the Signature Page and Questionnaire is true,
correct, accurate and current.
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9. The
personal, business and financial information of Private Purchaser which may have
been provided to XsunX, if any, and in any form, is complete and accurate, and
presents a true statement of Private Purchaser's financial
condition.
10. Private
Purchaser has adequate means of providing for Private Purchaser's current needs
and possible personal contingencies, and Private Purchaser has no need in the
foreseeable future to sell the Shares for which Private Purchaser hereby
subscribes. Private Purchaser is able to bear the economic risks of
Private Purchaser's purchase of Shares and, consequently, without limiting the
generality of the foregoing, Private Purchaser is able to hold Private
Purchaser's Shares for an indefinite period of time, and Private Purchaser has a
sufficient net worth to sustain a loss of Private Purchaser's entire investment
in XsunX in the event such loss should occur.
11. If
Private Purchaser is an individual, Private Purchaser is 18 years of age or
older.
12. Private
Purchaser understands that the Shares will not be transferable except under
limited circumstances.
13. Private
Purchaser is acquiring the Shares for Private Purchaser's own account for
investment with no present intention of dividing Private Purchaser's interest
with others or of reselling or otherwise disposing of all or any portion of the
same. Private Purchaser shall not engage in a distribution of the
Shares.
14. Private
Purchaser has such knowledge and experience in financial and business matters
that Private Purchaser is capable of evaluating the merits and risks of an
investment in XsunX or (if applicable) Private Purchaser and Private Purchaser's
representative, together, have such knowledge and experience in financial and
business matters that Private Purchaser and Private Purchaser's representative
are capable of evaluating the merits and risks of the prospective investment in
XsunX.
15. The
Shares will be acquired for Private Purchaser's own account for investment in a
manner which would not require registration pursuant to the provisions of the
Act, as amended, and Private Purchaser does not now have any reason to
anticipate any change in Private Purchaser's circumstances or other particular
occasion or event which would cause Private Purchaser to sell or otherwise
dispose of the Shares.
16. Private
Purchaser understands that the Commissioner of Corporations for the State of
California or the State of Colorado, or any other state ("Commissioner") has not
or will not recommend or endorse a purchase of the Shares.
17. Private
Purchaser hereby represents and warrants that Private Purchaser's total purchase
of Shares shall not exceed 10% of Private Purchaser's net worth (exclusive of
principal residence, mortgage thereon, home furnishings and
automobiles).
18. Private
Purchaser: (i) has a pre-existing personal or business relationship with XsunX,
its officers, directors or its Affiliates or representatives, and (ii) meets those
certain standards involving Private Purchaser's minimum net worth and annual
income as established by the California Commissioner of Corporations relating to
Private Purchaser's income and net worth, or is an Accredited Investor as
defined in rule 501 (a) of Regulation D as promulgated by the Securities and
Exchange Commission. The foregoing income and net worth is considered
to be indicative of Private Purchaser's ability to be sophisticated regarding
the proposed purchase of Shares.
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19. Private
Purchaser is not a member of the NASD or other self-regulatory agency which
would require prior approval of a purchase of the Shares.
20. Private
Purchaser acknowledges that Private Purchaser understands the meaning and legal
consequences of the representations, warranties, and covenants set forth herein,
and that XsunX has relied on such representations, warranties and
covenants.
21. Private
Purchaser acknowledges and understands that the Shares will be subject to
transfer and sale restrictions imposed pursuant to SEC Rule 144 of the Rules
promulgated under the Securities Act of 1933 (“Act”) and the regulations
promulgated thereunder. Private Purchaser shall comply with Rule 144
and with all policies and procedures established by XsunX with regard to Rule
144 matters. Private Purchaser acknowledges that XsunX or its
attorneys or transfer agent may require a restrictive legend on the certificate
or certificates representing the Shares pursuant to the restrictions on transfer
of the Shares imposed by Rule 144.
22. Notwithstanding
anything in this Agreement to the contrary, the undersigned acknowledges that:
(i) the Shares are subject to restrictions on transfer or sale imposed pursuant
to Rule 144; (ii) the Shares are being purchased in a private transaction which
is not part of a distribution of the Shares; (iii) the undersigned intends to
hold the Shares for the account of the undersigned and does not intend to sell
the shares as a part of a distribution or otherwise; and (iv) neither the
undersigned nor the seller of the Shares is an underwriter for purposes of Rule
144. A legend regarding Rule 144 restrictions may be placed upon the
certificate evidencing ownership of the Shares.
23. Private
Purchaser acknowledges that Private Purchaser is aware that there are
substantial restrictions on the transferability of the
Shares. Because the Shares will not, and Private Purchaser has no
right to require that the Shares, be registered pursuant to the provisions of
the Act or otherwise, Private Purchaser agrees not to sell, transfer, assign,
pledge, hypothecate or otherwise dispose of any Shares unless such sale is
exempt from such registration pursuant to the provisions of the
Act. Private Purchaser further acknowledges that unless as provided
for in this Agreement, XsunX has no obligation to assist Private Purchaser in
obtaining any exemption from any registration requirements imposed by applicable
law. Private Purchaser also acknowledges that Private Purchaser shall
be responsible for compliance with all conditions on transfer imposed by the
Commissioner or by the Securities and Exchange Commission (“SEC”).
24. Private
Purchaser understands and agrees that the following restrictions and limitations
are applicable to Private Purchaser's purchase and any sale, transfer,
assignment, pledge, hypothecation or other disposition of Shares pursuant to
Section 4(2) of the Act and Regulation D promulgated pursuant
thereto:
24.1. Private
Purchaser agrees that notwithstanding any other restrictions placed on the sale
or transfer of the Shares pursuant to this Agreement, Rule 144, or otherwise,
the Shares shall not be sold, pledged, hypothecated or otherwise disposed of
unless the Shares are registered pursuant to the Act and applicable state
securities laws or are exempt there from; and
24.2. A
legend in substantially the following form may be placed on any certificate(s)
or other documents evidencing the Shares:
THE
SECURITIES REPRESENTED BY THIS INSTRUMENT OR DOCUMENT HAVE BEEN ACQUIRED FOR
INVESTMENT ONLY AND HAVE NOT BEEN REGISTERED PURSUANT TO THE PROVISIONS OF THE
SECURITIES ACT OF 1933 AS AMENDED ("ACT”), AND HAVE BEEN OFFERED AND SOLD IN
RELIANCE UPON THE EXEMPTION SET FORTH IN SECTIONS 4(1) OR 4(2) OF THE ACT AND
UPON RULE 504 OF REGULATION D PROMULGATED PURSUANT THERETO. WITHOUT
SUCH REGISTRATION, SUCH SECURITIES MAY NOT BE SOLD, TRANSFERRED, ASSIGNED,
PLEDGED, HYPOTHECATED OR OTHERWISE DISPOSED OF, EXCEPT UPON DELIVERY TO XSUNX OF
AN OPINION OF COUNSEL SATISFACTORY TO XSUNX.
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25. Private
Purchaser may not cancel, terminate, or revoke this Agreement, or any agreement
of Private Purchaser made hereunder, and this Agreement shall survive the death,
dissolution, or disability of Private Purchaser and shall be binding upon the
heirs, executors, administrators, successors and assigns of Private
Purchaser.
26.
This Agreement constitutes the entire agreement among the parties
hereto with respect to the subject matter hereof and may be amended only by a
writing executed by all parties hereto.
27. This
Agreement shall be enforced, governed and construed in all respects in
accordance with the laws of the State of California without giving effect to the
conflicts of laws provisions. Private Purchaser hereby agrees that
any suit, action or proceeding with respect to this Agreement, any amendments or
any replacements hereof, and any transactions relating hereto shall be brought
in the state courts of, or the federal courts in, the State of California, and
Private Purchaser hereby irrevocably consents and submits to the jurisdiction of
such courts for the purpose of any such suit, action or proceeding, and Private
Purchaser agrees that service of process on Private Purchaser in such suit,
action or proceeding may be made In accordance with the notice provisions of
this Agreement, In any such action, venue shall lie exclusively in Orange
County, California. Private Purchaser hereby waives, and agrees not
to assert against XsunX, or any successor assignee thereof, by way of motion, as
a defense or otherwise, in any such suit, action or proceeding, (i) any claim
that Private Purchaser is not personally subject to the jurisdiction of the
above-named courts or that property is exempt or immune from set-off, execution
or attachment either prior to judgment or in execution thereof, and (ii) to the
extent permitted by applicable law, any claim that such suit, action or
proceeding is brought in an inconvenient forum or that the venue of suit, action
or proceeding is improper or that this Agreement or any amendments or any
replacements hereof may not be enforced in, or by such courts.
THE SHARES OFFERED HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR THE
SECURITIES LAWS OF CERTAIN STATES, AND ARE BEING OFFERED AND SOLD IN RELIANCE ON
AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE ACT AND SUCH
LAWS. THE SHARES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION, ANY STATE SECURITIES COMMISSION OR OTHER
REGULATORY AUTHORITY.
PRIVATE PURCHASER MAY BE REQUIRED TO
HOLD THE SHARES INDEFINITELY UNLESS SUCH SHARES ARE SUBSEQUENTLY REGISTERED
UNDER THE SECURITIES ACTOF 1933 ("ACT") OR AN EXEMPTION FROM SUCH REGISTRATION
IS AVAILABLE. NO SHARES MAY BE SOLD, ASSIGNED OR OTHERWISE
TRANSFERRED UNLESS XSUNX AND ITS LEGAL COUNSEL HAVE RECEIVED EVIDENCE
SATISFACTORY TO BOTH THAT SUCH TRANSFER DOES NOT INVOLVE A TRANSACTION REQUIRING
QUALIFICATION OR REGISTRATION UNDER STATE OR FEDERAL SECURITIES LAWS AND IS IN
COMPLIANCE WITH SUCH LAWS.
(SIGNATURES
APPEAR ON FOLLOWING PAGES)
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SIGNATURE
PAGE AND QUESTIONAIRE TO STOCK PURCHASE AGREEMENT AMONG
XSUNX,
INC. AND THE PRIVATE PURCHASER(S) NAMED BELOW
As
applicable, the undersigned further represents and warrants as indicated below
by the undersigned's initials:
I. ACCREDITED
INVESTOR STATUS
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A.
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Individual
investors: (Initial one or more of the following three
statements)
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1.
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____ I
certify that I am an accredited investor because I have had individual
income (exclusive of any income earned by my spouse) of more than
US$200,000 in each of the most recent two years and I reasonably expect to
have an individual income in excess of US$200,000 for the current
year.
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2.
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____ I
certify that I am an accredited investor because I have had joint income
with my spouse in excess of US$300,000 in each of the two most recent
years and I reasonably expect to have joint income with my spouse in
excess of $300,000 for the current
year.
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3.
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____ I
certify that I am an accredited investor because I have an individual net
worth, or my spouse and I have a joint net worth, in excess of
US$1,000,000.
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B.
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Partnerships,
corporations, trusts or other
entities:
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(Initial
one of the following statements)
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1.
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The
undersigned hereby certifies that it is an accredited investor because it
is:
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________
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a.
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an
employee benefit plan whose total assets exceed
US$5,000,000;
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________
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b.
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an
employee benefit plan whose investment decisions are made by a plan
fiduciary which is either a bank, savings and loan association or an
insurance company (as defined in Section 3(a) of the Securities Act) or an
investment adviser registered as such under the Investment Advisers Acts
of 1940;
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________
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c.
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a
self-directed employee benefit plan, including an Individual Retirement
Account, with investment decisions made solely by persons that are
accredited investors;
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________
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d.
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an
organization described in Section 501(c)(3) of the Internal Revenue Code
of 1986, as amended (the "IRC"), not formed for the specific purpose of
acquiring the Shares with total assets in excess of
US$5,000,000;
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________
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e.
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any
corporation, partnership or Massachusetts or similar business trust, not
formed for the specific purpose of acquiring the Shares, with total assets
in excess of US$5,000,000; or
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________
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f.
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a
trust with total assets in excess of US$5,000,000, not formed for the
specific purpose of acquiring the Shares, whose purchase is directed by a
person who has such knowledge and experience in financial and business
matters that he is capable of evaluating the merits and risks of an
investment in the Shares.
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________
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2.
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The
undersigned hereby certifies that it is an accredited investor because it
is an entity in which each of the equity owners qualifies as an accredited
investor under items A(1), (2) or (3) or item B(1)
above.
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II. Indemnification. The
undersigned agrees, to the fullest extent permitted pursuant by law, to
indemnify, defend, and hold harmless XsunX, Inc. and its agents, representatives
and employees from and against all liability, damage, loss, cost and expense
(including reasonable attorneys' fees) which they may incur by reason of the
failure of the undersigned to fulfill any of the terms or conditions of
the Agreement or this Signatory Page and Questionnaire, or by reason
of any inaccuracy or omission in the information furnished by the undersigned
herein or any breach of the representations and warranties made by the
undersigned herein, or in any document provided by the undersigned, directly or
indirectly, to XsunX, Inc.
III. Limitation on Short Sales
and Hedging Transactions. Private Purchaser agrees that
beginning on the effective date of this Agreement, the Private Purchaser and its
agents, representatives and affiliates shall not in any manner whatsoever enter
into or effect, directly or indirectly, any (i) "short sale" (as such term is
defined in Section 242.200 of Regulation SHO of the ▇▇▇▇ ▇▇▇) of the Common
Stock or (ii) hedging transaction, which establishes a net short position with
respect to the Common Stock.
IV. Offer and Purchase
Price. Private Purchaser hereby offers to purchase
_________________________________________________ (________________) Shares of
XsunX common stock for a total purchase price of
_________________________________________ Dollars ($__________________ USD), the
“Purchase Price”. Upon payment to the account of XsunX as set forth herein, such
_________________________ Shares shall be, validly issued and be fully paid and
nonassessable. The Shares shall be issued
in certificated form and shall bear the restrictive legend set forth in Section
24.2 above.
THE
FOLLOWING SECTION MUST BE COMPLETED BY PRIVATE PURCHASER
Private
Purchaser:
Name
(please
print)
________________________________
Social
Security # (or Tax ID #)
________________________________
Address:
_____________________________________________________
(Including
Zip Code)
Phone Number
_____________________________________________________
Fax Number _____________________________________________________
Name in
which shares should be issued:
_______________________________
Private
Purchaser will hold title as follows:
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{ } Community
Property
{ } Joint
Tenants with Right Survivorship
{ } Tenants
in Common
{ } Individually
{ } Other: (Corporation,
Trust, Etc., please indicate)*
*If
Private Purchaser is an entity, the attached Certificate of Signatory must also
be completed.
Private
Purchaser shall pay the purchase price by wire transfer of immediately available
funds to:
Beneficiary Name: XsunX,
Inc.
Routing Transit Num:
Acct Number:
Bank Name:
Address:
Tel:
IN WITNESS WHEREOF, subject to
acceptance by the Company, Private Purchaser has provided the foregoing
warranties and undertaken the foregoing obligations and the parties have
executed this Agreement effective as of the date first set forth
above.
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Private
Purchaser:
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By:
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Print Name:
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Its:
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THIS
PURCHASE OFFER IS ACCEPTED THIS _____ DAY OF _____________, 20__.
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XsunX,
Inc., a Colorado corporation
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By:
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▇▇▇
▇. ▇▇▇▇▇▇▇▇▇
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Its:
CEO
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CERTIFICATE
OF SIGNATORY
(To be
completed if Shares are being subscribed for by an entity)
I,
____________________________, am the ____________________________
of
________________________________________________________
(the “Entity”).
I certify
that I am empowered and duly authorized by the Entity to execute and carry out
the terms of the Purchase Agreement and to purchase and hold the Common Stock,
and certify further that the Purchase Agreement has been duly and validly
executed on behalf of the Entity and constitutes a legal and binding obligation
of the Entity.
IN
WITNESS WHEREOF, I have set my hand this ________ day of _________________,
20__.
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(Signature)
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