FORM OF SUBSCRIPTION AGREEMENT RICK’S CABARET INTERNATIONAL, INC.
Exhibit
4.2
FORM
OF
RICK’S
CABARET INTERNATIONAL, INC.
Rick's
Cabaret
International, Inc.
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The
undersigned, ____________ (the "Subscriber"), understands that Rick's
Cabaret
International, Inc., a Texas Corporation (the "Company") is offering for sale
to
the undersigned ________ shares of Common Stock (ACommon
Stock@)
at a
purchase price of $9.40 per share, for a total aggregate purchase price of
$__________. The Subscriber acknowledges and understands that the offering
of
the Common Stock (the "Offering") is being made without registration of the
Common Stock under the Securities Act of 1933, as amended (the "Act"), or any
securities "blue sky" or other similar laws of any state.
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1.
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Subscription.
Subject to the terms and conditions hereof, the Subscriber hereby
subscribes for and agrees to purchase ________ shares of Common Stock
for
the aggregate purchase price of $_____________ upon acceptance of
this
Subscription Agreement.
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2.
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Payment
for the Common Stock.
The undersigned encloses herewith $___________ required to purchase
the
Common Stock subscribed for hereunder. If this subscription is not
accepted by the Company for any reason, all documents will be returned
to
the Subscriber.
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3.
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Representations
and Warranties of the Subscriber.
The Subscriber hereby represents and warrants to and covenants with
the
Company, as well as each officer, director and agent of the Company
as
follows:
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(a)
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General
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(i) The
Subscriber has all requisite authority to enter into this Subscription Agreement
and to perform all the obligations required to be performed by the Subscriber
hereunder.
(ii) The
Subscriber is
the sole party in interest and is not acquiring the Common Stock as an agent
or
otherwise for any other person. The Subscriber is a resident of the state set
forth opposite its name on the signature page hereto and (a) if a corporation,
partnership, trust or other form of business organization, it has its principal
office within such state; (b) if an individual, he or she has his or her
principal residence in such state; and (c) if a corporation, partnership, trust
or other form of business organization which was organized for the specific
purpose or acquiring the Common Stock, all of the beneficial owners are
residents of such state.
(iii)
The Subscriber recognizes that the total amount of funds tendered to purchase
the Common Stock is placed at the risk of the business and may be completely
lost. The purchase of the Common Stock of the Company as an investment involves
extreme risk.
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(iv)
The Subscriber realizes that the Common Stock cannot readily be sold as the
shares of Common Stock are restricted securities, that it may not be possible
to
sell or dispose of the Common Stock and therefore the Common Stock must not
be
purchased unless the Subscriber has liquid assets sufficient to assure that
such
purchase will cause no undue financial difficulties and the Subscriber can
provide for current needs and personal contingencies.
(v) The
Subscriber
confirms and represents that it is able (a) to bear the economic risk of its
investment, (b) to hold the securities for an indefinite period of time, and
(c)
to afford a complete loss of its investment. The Subscriber also represents
that
it has (x) adequate means of providing for its current needs and personal
contingencies, and (y) has no need for liquidity in this particular investment.
(vi)
The Subscriber has not become aware of the offering of Common Stock of the
Company by any form of general solicitation or advertising, including, but
not
limited to advertisements, articles, notices or other communications published
in any newspaper, magazine or other similar media or broadcast over television
or radio or any seminar or meeting where those individuals that have attended
have been invited by any such or similar means of general solicitation or
advertising.
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(b)
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Information
Concerning the Company.
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(i) The
Subscriber acknowledges that it has received all current information about
the
Company including the Company’s (A) Form 10-KSB for the fiscal year ended
September 30, 2006, (B) Form 10-QSB for the Company's quarters ended December
31, 2006, June 30, 2006 and March 31, 2006; and (C) Forms 8-K of the Company
filed February 6, 2007, November 14, 2006, October 12, 2006, August 28, 2006,
August 10, 2006, July 13, 2006, and July 12, 2006 (“Filed
Documents”).
(ii) The
Subscriber or its representative is familiar with the business and financial
condition, properties, operations and prospects of the Company, and, at a
reasonable time prior to the execution of this Subscription Agreement, that
its
representative has been afforded the opportunity to ask questions of and receive
satisfactory answers from the Company's officers and directors, or other persons
acting on the Company's behalf, concerning the business and financial condition,
properties, operations and prospects of the Company and concerning the terms
and
conditions of the offering of the Common Stock and has asked such questions
as
its representative desires to ask and all such questions have been answered
to
the full satisfaction of the Subscriber.
(iii)
The
Subscriber has been furnished, has carefully read, and has relied solely (except
for information obtained pursuant to (iv) below, on the information contained
in
the Filed Documents, and Subscriber has not received any other offering
literature or prospectus, and no verbal or written representations or warranties
have been made to Subscriber by the Company, or its employees or agents, other
than the representations of the Company set forth herein and in the Filed
Documents.
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(iv)
The
Subscriber has had an unrestricted opportunity to: (i) obtain additional
information concerning the offering of Common Stocks, the Common Stock, the
Company and any other matters relating directly or indirectly to Subscriber’s
purchase of the Common Stock; and (ii) ask questions of, and receive answers
from the Company concerning the terms and conditions of the Offering and to
obtain such additional information as may have been necessary to verify the
accuracy of the information contained in the Filed Documents.
(v) The
Subscriber
understands that, unless the Subscriber notifies the Company in writing to
the
contrary, all the representations and warranties contained in this Subscription
Agreement will be deemed to have been reaffirmed and confirmed, taking into
account all information received by the Subscriber.
(vi)
The Subscriber understands that the purchase of the Common Stock involves
various risks, including, but not limited to, those outlined in this
Subscription Agreement and the Filed Documents.
(vii) The
Subscriber acknowledges that no representations or warranties have been made
to
the Subscriber by the Company as to the tax consequences of this investment,
or
as to profits, losses or cash flow which may be received or sustained as a
result of this investment.
(viii)
All documents, records and books pertaining to a proposed investment in the
Common Stock which the Subscriber or its representative has requested have
been
made available to the Subscriber.
(ix) The
Subscriber or
its representative has been provided access to all information requested in
evaluating its purchase of the Common Stock.
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(c)
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Status
of the Subscriber
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(i) The
Subscriber represents that the Subscriber is an Accredited Investor as that
term
is defined pursuant to Section 501 of Regulation D under the Act.
(ii) The
Subscriber agrees to furnish any additional information requested to assure
compliance with applicable Federal and state securities laws in connection
with
the purchase and sale of the Common Stock.
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(d)
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Restrictions
on Transfer or Sale of the Common
Stock
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(i) The
Subscriber is acquiring the Common Stock subscribed solely for the Subscriber's
own beneficial account, for investment purposes, and not with view to, or for
resale in connection with, any distribution of the Common Stock. The Subscriber
understands that the offer and the sale of the Common Stock has not been
registered under the Act or any state securities laws by reason of specific
exemptions under the provisions thereof which depend in part upon the investment
intent of the Subscriber and of the other representations made by the Subscriber
in this Subscription Agreement. The Subscriber understands that the Company
is
relying upon the representations, covenants and agreements contained in this
Subscription Agreement (and any supplemental information) for the purposes
of
determining whether this transaction meets the requirements for such
exemptions.
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(ii) The
Subscriber
understands that the shares of Common Stock are "restricted securities" under
applicable federal securities laws and that the Act and the rules of the
Securities and Exchange Commission (the "Commission") provide in substance
that
the Subscriber may dispose of the Common Stock only pursuant to an effective
registration statement under the Act or an exemption therefrom. The certificates
evidencing the shares of Common stock offered hereby will bear a legend which
clearly sets forth this restriction. The Subscriber understands that the
Subscriber may not at any time demand the purchase by the Company of the
Subscriber's Common Stock.
(iii)
The Subscriber agrees: (A) that the Subscriber will not sell, assign, pledge,
give, transfer or otherwise dispose of the Common Stock or any interest therein,
or make any offer or attempt to do any of the foregoing, except pursuant to
a
registration of the Common Stock under the Act and all applicable state
securities laws or in a transaction which is exempt from the registration
provisions of the Act and all applicable state securities laws; (B) that the
Company and any transfer agent for the Common Stock shall not be required to
give effect to any purported transfer of any of the Common Stock except upon
compliance with the foregoing restrictions; and (C) that a restrictive legend
will be placed on the certificates representing the Common Stock.
(iv)
The Subscriber has not offered or sold any portion of the subscribed for Common
Stock and has no present intention of dividing such Common Stock with others
or
of reselling or otherwise disposing of any portion of such Common Stock either
currently or after the passage of a fixed or determinable period of time or
upon
the occurrence or nonoccurrence of any predetermined event or
circumstance.
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Registration
Rights.
The Company shall prepare and file with the Commission a registration
statement covering the shares of Common Stock purchased hereby within
thirty (30) days after the closing of this transaction(the “Registration
Statement”). The Registration Statement shall be on Form SB-2 or Form S-3,
or such other appropriate form. The Company shall use its best efforts
to
cause the Registration Statement to be declared effective by the
Commission and shall use its best efforts to keep the Registration
Statement continuously effective under the Securities Act until the
second
anniversary of the Effective Date or such earlier date when all shares
covered by the Registration Statement have been sold publicly (the
“Effectiveness
Period”).
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5.
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Survival
and Indemnification.
All representations, warranties and covenants contained in this Agreement
and the indemnification contained in this Paragraph 5 shall survive
(i)
the acceptance of the Subscription Agreement by the Company and (ii)
the
death or disability of the Subscriber. The Subscriber acknowledges
the
meaning and legal consequences of the representations, warranties
and
covenants in Paragraph 3 hereof and that the Company has relied upon
such
representations, warranties and covenants in determining the Subscriber's
qualification and suitability to purchase the Common Stock. The Subscriber
hereby agrees to indemnify, defend and hold harmless the Company,
and its
officers, directors, employees, agents and controlling persons, from
and
against any and all losses, claims, damages, liabilities, expenses
(including attorneys' fees and disbursements), judgment or amounts
paid in
settlement of actions arising out of or resulting from the untruth
of any
representation herein or the breach of any warranty or covenant herein.
Notwithstanding the foregoing, however, no representation, warranty,
covenant or acknowledgment made herein by the Subscriber shall in
any
manner be deemed to constitute a waiver of any rights granted to
it under
the federal securities or state securities
laws.
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6.
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Notices.
All notices and other communications provided for herein shall be
in
writing and shall be deemed to have been duly given if delivered
personally or sent by registered or certified mail, return receipt
requested, postage prepaid, or overnight air courier guaranteeing
next day
delivery:
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(a)
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if
to the Company, to it at the following
address:
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RICK'S
CABARET
INTERNATIONAL, INC.
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Attn:
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Telephone
No. (▇▇▇) ▇▇▇ ▇▇▇▇
Facsimile
No: (▇▇▇) ▇▇▇ ▇▇▇▇
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(b)
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if
to the Subscriber, at the address set forth on the first page hereof
or
directly to the Subscriber at the address set forth on the signature
page
hereto, or at such other address as either party shall have specified
by
notice in writing to the other.
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All
notice and communications shall be deemed to have been duly given: at the time
delivered by hand, if personally delivered; two days after being deposited
in
the mail, postage prepaid, if mailed; and the next day after timely delivery
to
the courier, if sent by overnight air courier guaranteeing next day
delivery.
If
a
notice or communication is mailed in the manner provided above within the time
prescribed, it is duly given, whether or not the addressee receives
it.
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7.
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Assignability.
This Subscription Agreement is not assignable by the Subscriber,
and may
not be modified, waived or terminated except by an instrument in
writing
signed by each of the parties
hereto.
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8.
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Binding
Effect.
Except as otherwise provided herein, this Subscription Agreement
shall be
binding upon and inure to the benefit of the parties and their heirs,
executors, administrators, successors, legal representatives and
assigns,
and the agreements, representations, warranties and acknowledgments
contained herein shall be deemed to be made by and be binding upon
such
heirs, executors, administrators, successors, legal representatives
and
assigns. If the Subscriber is more than one person, the obligation
of the
Subscriber shall be joint and several and the agreements, representations,
warranties and acknowledgments contained herein shall be deemed to
be made
by and be binding upon each such person and his heirs, executors,
administrators and successors.
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9.
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Entire
Agreement.
This Subscription Agreement constitutes the entire agreement of the
Subscriber and the Company relating to the matters contained herein,
superseding all prior contracts or agreements, whether oral or
written.
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10.
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Governing
Law.
This Subscription Agreement shall be governed and controlled as to
the
validity, enforcement, interpretations, construction and effect and
in all
other aspects by the substantive laws of the State of Texas. In any
action
between or among any of the parties, whether arising out of this
Agreement
or otherwise, each of the parties irrevocably consents to the exclusive
jurisdiction and venue of the federal and state courts located in
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County, Texas.
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11.
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Severability.
If any provision of this Subscription Agreement or the application
thereof
to any Subscriber or circumstance shall be held invalid or unenforceable
to any extent, the remainder of this Subscription Agreement and the
application of such provision to other subscriptions or circumstances
shall not be affected thereby and shall be enforced to the greatest
extent
permitted by law.
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12.
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Headings.
The headings in this Subscription Agreement are inserted for convenience
and identification only and are not intended to describe, interpret,
define, or limit the scope, extent or intent of this Subscription
Agreement or any provision hereof.
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13.
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Amount
of Common Stock Subscribed For.
The Subscriber hereby subscribes to purchase _________ shares of
Common
Stock of the Company at $9.40 per share for a total consideration
of
$____________.
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14.
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Counterparts
and Facsimiles.
This Subscription Agreement may be executed in multiple counterparts
and
in any number of counterparts, each of which shall be deemed an original
but all of which taken together shall constitute and be deemed to
be one
and the same instrument and each of which shall be considered and
deemed
an original for all purposes. This Agreement shall be effective with
the
facsimile signature of any of the parties set forth below and the
facsimile signature shall be deemed as an original signature for
all
purposes and the Agreement shall be deemed as an original for all
purposes.
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[SIGNATURES
APPEAR ON THE FOLLOWING PAGE.]
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IN
WITNESS WHEREOF, the undersigned Subscriber has executed this Subscription
Agreement this ____ day of March, 2007.
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Signature
of Investor
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Name
(Please type or print)
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Signature
of Spouse or Co-Owner if funds are to be invested as joint tenants
by the
entirety or community property.
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Name
(Please type or print)
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Street
Address
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City
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State
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Zip
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ACCEPTED
by the Company this the ____ day of _______________, 2007.
Rick’s
Cabaret International, Inc.
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By:
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