EXHIBIT 10.1
PRIVATE PLACEMENT SUBSCRIPTION AGREEMENT
LIBERTY COAL ENERGY CORP,
00 00xx xxxxxx Xxxxx 0000
Xxxxxx, XX 00000, XXX
April 30, 2011
Attention: Xxxxx Xxxxxx, President
Gentlemen:
1. Subscription.
Liberty Coal Energy has available up to 666,667 Share purchase Units for
purchase in a Private Placement of Shares.
The undersigned (the" Purchaser") intending to he legally hound, hereby
irrevocably agrees to purchase from Liberty Coal Energy Corp,, a Nevada
Corporation (the "Company") the number of Units set forth on the Signature Page
at the end of this subscription Agreement (the "Agreement"). EACH UNIT CONSISTS
OF ONE SHARE OF COMMON STOCK AND ONE WARRANT TO PURCHASE AN ADDITIONAL SHARE OF
COMMON STOCK AT A PRICE OF $.82 WITHIN 24 MONTHS. EACH UNIT IS OFFERED AT A
PURCHASE PRICE PER UNIT OF $0.75 USD, upon the terms and conditions herein-alter
set forth.
THE UNDERSIGNED IS DELIVERING (I) THE SUBSCRIPTION PAYMENT MADE PAYABLE TO
LIBERTY COAL ENERGY CORP. (II) TWO EXECUTED COPIES EL THE SIGNATURE PAGE AT THE
END OF THIS AGREEMENT, AND (III) ONE EXECUTED COPY OF PURCHASER QUESTIONNAIRE
FOR INDIVIDUALS (IF APPROPRIATE), ATTACHED HERETO AS EXHIBIT 11, TO:
LIBERTY COAL ENERGY CORP.
00 00xx xxxxxx Xxxxx 0000
Xxxxxx, XX 00000, XXX
Attention: Xxxxx Xxxxxx, President
The undersigned understands that the Common Stock is being issued pursuant to
the exemption from the registration requirements of the United States Securities
Act of 1933, as amended (the "Securities Act"), provided by Section 4(2) of such
Securities Act. As such, the Common Stock is only being offered and sold to
investors who qualify as "accredited investors" and a limited number of
"sophisticated investors" and the Company is relying on the representations made
by the undersigned in this Agreement that the undersigned qualifies as such an
accredited investor. The shares of Common Stock are "restricted securities" for
purposes of the United States securities laws and cannot be transferred except
as permitted under these laws.
2. Acceptance of Subscription.
The Offering will be open until May 30, 2011, but the Company may extend this
period in our discretion for up to an additional 60 days.
Subject to applicable state securities laws, the Purchaser may not revoke any
subscription that such Purchaser delivers to the Company. However, the
undersigned understands and agrees that. the Company, in its sole discretion,
may (i) reject the subscription or any Purchaser, whether or not qualified, in
whole or in, part, and (ii) may withdraw the Offering at any time prior to the
termination of the Offering. The Company shall have no obligation to accept
subscriptions in the order received. This subscription shall become binding only
if accepted by the Company.
3. Memorandum.
The Purchaser hereby acknowledges that the purchaser has relied on the documents
filed with the United States and Exchange Commission as required under the The
Securities Exchange Act of 1934. The Company has not issued a Confidential
Private Placement Memorandum.
4. Representations and Warranties.
4.1. The Company represents and warrants to, and agrees with the
undersigned as follows, in each case as of the date hereof and in all material
respects as of the date of any closing, except for any changes resulting solely
from the Offering:
(a) The Company is duly organized, validly existing and in good standing
under the laws of the jurisdiction of its incorporation with full power and
authority to own, lease, license and use its properties and assets and to carry
out the business. The Company is duly qualified to transact the business in
which it is engaged and is in good standing as a foreign corporation in every
jurisdiction in which its ownership, leasing, licensing or use of property or
assets or the conduct or its business makes such qualification necessary, except
where the failure to be so qualified would not have a material adverse effect on
the Company.
(b) At the date of the commencement of the offering the authorized capital
stock of the Company will consist of 300,000,000 shares of common stock, par
value $0.001 per share. At such date, there will be outstanding no more than
43,785,000 shares of Common Stock, excluding shares issued in connection with
the Offering, shares issued upon exercise or conversion of options, warrants or
other rights outstanding as of the date of the initial closing, in accordance
with their terms as of such date,
Each outstanding share of Common Stock is validly authorized, validly issued,
fully paid and nonassessable, without any personal liability attaching to the
ownership thereof and has not been issued and is not or will not be owned or
held in violation of any preemptive rights of stockholders. There is no
commitment, plan or arrangement to issue, and no outstanding option, warrant or
other right calling for the issuance of any share or capital stock of the
Company or any security or other instrument which by its terms is convertible
into, exercisable for or exchangeable for capital stock of the Company. There is
outstanding no security or other instrument which by its terms is convertible
into or exchangeable for capital stock, of the Company.
(c) There is no litigation, arbitration, claim, governmental or other
proceeding (formal or informal), or investigation pending or, to the best
knowledge of the officers of the Company, threatened with respect to the
Company, or any of its subsidiaries, operations, businesses, properties or
assets or such as individually or in the aggregate do not, now have and could
not reasonably be expected have a material adverse effect upon the operations,
business, properties or assets of the Company.
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(d) The Company is not in violation of, or in default with respect to any
law, rule, regulation, order, judgment or decree or such as in the aggregate do
not now have and will not in the future have a material adverse effect upon the
operations, business, properties or assets or the Company; nor is the Company
required to take any action in order to avoid any such violation or default.
(e) The Company has all requisite power and authority (i) to execute,
deliver and perform its obligations under this Agreement and (ii) to issue and
sell the shares of Stock in the Offering.
(f) No consent, authorization, approval, order, license, certificate or
permit a or from, or declaration or filing with, any United States federal,
state, local, or other applicable governmental authority, or any court or any
other tribunal, is required by the Company for the execution, delivery or
performance by the Company of this Agreement or the issuance and sale of the
shares or Common Stock, except such filing and consents as may be required and
have been or at the initial closing, will have been made or obtained under the
laws of the United States federal and state securities laws.
(g) The execution, delivery and performance of this Agreement and the
issuance or the shares of Common Stock will not violate or result in a breach of
or entitle any party (with or without the giving of notice or the passage of
time or both) to terminate or call a default under any agreement or violate or
result in a breach of any term of the Company's Articles or Incorporation or
Bylaws of, or violate any law, rule, regulation, order, judgment or decree
binding upon, the Company, or to which any of its operations, businesses,
properties or assets are subject, the breach, termination or violation of which,
or default under which, would have a material adverse effect on the operations,
business, properties or assets of the Company.
(h) The shares or Common Stock issuable in this Offering are validly
authorized and, if and when issued in accordance with the terms and conditions
set forth in this Agreement will be validly issued, fully paid and nonassessable
without any personal liability attaching to the ownership thereof, and will not
be issued in violation of any preemptive or other rights of stockholders.
4.2. The undersigned hereby represents and warrants to, and agrees with,
the Company as follows;
(a) The undersigned is an "Accredited investor" as that term is defined in
Rule 501 (a) of Regulation D promulgated under the Securities Act, and as
specifically indicated in Exhibit l attached to this Agreement, or
(b) The undersigned is a "Sophisticated Investor" as that term is defined
in Rule 506(b)(2)(ii) of Regulation D promulgated under the Securities Act.
(c) For California and Massachusetts individuals: If the subscriber is a
California resident, such subscriber's investment in the Company will not exceed
10% of such subscriber's net worth (or joint net worth with his spouse). If the
subscriber is a Massachusetts resident, such subscriber's investment in the
Company will not exceed 25% of such subscriber's joint net worth with such
subscriber's spouse (exclusive of principal residence and its furnishings).
(d) If a natural person, the undersigned is: a bona fide resident of the
state or non-United States jurisdiction contained in the address set forth on
the Signature Page of this Agreement as the undersigned's home address: at least
21 years of age; and legally competent to execute this Agreement. If an entity,
the undersigned has its principal offices or principal place of business in the
state or non-United States jurisdiction contained in the address set forth on
the Signature Page of this Agreement. The individual signing on behalf of the
undersigned is duly authorized to execute, this Agreement and this Agreement
constitutes the legal, valid and binding obligation of the undersigned
enforceable against the undersigned in accordance with its terms,
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(e) The undersigned has received, read carefully and is familiar with this
Agreement.
(f) The undersigned is familiar with the Company's business, plans and
financial condition and the undersigned has received all materials which have
been requested by the undersigned, has had a reasonable opportunity to ask
questions of the Company and its representatives, and the Company has answered
all inquiries that the undersigned or the undersigned's representatives have put
to it. The undersigned has had access to all additional information necessary to
verify the accuracy of the information set forth in this Agreement and any other
materials furnished herewith, and have taken all the steps necessary to evaluate
the merits and risks of an investment as proposed hereunder.
(g) The undersigned (or the undersigned's purchaser representative) has
such knowledge and experience in finance, securities, taxation, investments and
other business matters so as to be able to protect the interests of the
undersigned in connection with this transaction, and the undersigned's
investment in the Company hereunder is not material when compared to the
undersigned's total financial capacity.
(h) The undersigned understands the various risks of an investment in the
Company as proposed herein and can afford to bear such risks, including, without
limitation, the risks of losing the entire investment.
(i) The undersigned acknowledges that no market for the Common Stock
presently exists and none may develop in the future and that the undersigned may
find it impossible to liquidate the investment at a time when it may be
desirable to do so, or at any other time.
(j) The undersigned has been advised by the Company that none of the Common
Stock has been registered under the Securities Act, that the Common Stock will
be issued on the basis of the statutory exemption provided by Section 4(2) of
the Securities Act or Regulation D promulgated there under, or both, relating to
transactions by an issuer not involving any public offering and under similar
exemptions under certain slate securities laws: that this transaction has not
been reviewed by, passed on or submitted to any federal or state agency or
self-regulatory organization where an exemption is being relied upon; and that
the Company's reliance thereon is based in part upon the representations made by
the undersigned in this Agreement,
kj) The undersigned acknowledges that the undersigned has been informed by
the Company of or is otherwise familiar with the nature of the limitations
imposed by the Securities Act and the rules and regulations there under on the
transfer of the Common Stock. In particular, the undersigned agrees that no
sale, assignment or transfer of any of the Common Stock shall be valid or
effective, and the Company shall not be required to give any effect to such a
sale, assignment or transfer, unless (i) the sale, assignment or transfer (ii)
such Common Stock is registered under the Securities Act, it being understood
that the Common Stock are not currently registered for sale and that the Company
has no obligation or intention to so register the Common Stock, except as
contemplated by the terms of this Agreement or (ii) such Common Stock is sold
assigned or transferred in accordance with all the requirements and limitations
of Rule 144 under the Securities Act (it being understood that Rule 144 is not
available at the present time for the sale of the Common Stock), or (iii) such
sale, assignment or transfer is otherwise exempt from registration under the
Securities Act, including Regulation S promulgated there under. The undersigned
further understands that an opinion of counsel and other documents may he
required to transfer the Common Stock.
(k) The undersigned acknowledges that the Common Stock shall be subject to
a stop transfer order and the certificate or certificates evidencing any Common
Stock shall bear the following or a substantially similar legend or such other
legend as may appear on the forms of Common Stock and such other legends as may
be required by state blue sky laws:
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THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE UNITED STATES SECURITIES ACT OP 1933 (THE "ACT") OR APPLICABLE STATE
SECURITIES LAWS, AND SUCH SECURITIES MAY NOT BE SOLD OR TRANSFERRED IN THE
ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH SALE OR TRANSFER IS EXEMPT FROM SUCH
REGISTRATION REQUIREMENTS OF THE ACT AND APPLICABLE STATE SECURITIES LAWS..
(l) The undersigned will acquire the Common Stock for the undersigned's own
account (or for the joint account of the undersigned and the undersigned's
spouse either in joint tenancy, tenants by the entirety or tenancy in common)
for investment and not with a view to the sale or distribution thereof or the
granting of any participation therein, and has no present intention of
distributing or selling to others any of such interest or granting any
participation therein.
(m) No representation, guarantee or warranty has been made to the
undersigned by any broker, the Company, any of the officers, directors,
stockholders, partners, employees or agents of either or them, or any other
persons, whether expressly or by implication, that:
(i) the Company or the undersigned will realize any given percentage
of profits and/or amount or type of consideration, profit or loss as a result or
the Company's activities or the undersigned's investment, in the Company; or
(ii) the past performance or experience of the management or the
Company, or any other person, will in any way indicate the predictable results
of the ownership of the Common Stock or of the Company's activities,
(n) No oral or written representations have been made and no oral or
written information furnished to the undersigned or the undersigned's advisor(s)
in connection with the sale of the companies shares.
(o) The undersigned is not subscribing for the Common Shares as a result of
or subsequent to any advertisement, article, notice or other communication
published in any newspaper, magazine or similar media or broadcast over
television or radio, or presented at any seminar or meeting, or any solicitation
or a subscription by a person other than a representative or the Company with
which the undersigned had a pre-existing relationship in connection with
investments in securities generally.
(p) The undersigned is not relying on the Company with respect to the tax
and other economic considerations of an investment.
(q) The undersigned acknowledges that the representations, warranties and
agreements made by the undersigned herein shall survive the execution and
delivery of this Agreement and the purchase of the Common Stock.
(r) The undersigned has consulted with his own financial, legal and tax
advisors with respect to the economic, legal and tax consequences of an
investment in the Common Stock and has not relied on the Company, its officers,
directors or professional advisors for advice as to such consequences
5. Indemnification.
The Purchaser understands the meaning and legal consequences of the
representations and warranties contained in Section 4.2, and agrees to indemnify
and hold harmless the Company and each member, officer, employee, agent or
representative thereof against any and all loss, damage or liability due to or
arising out of a breach of any representation or warranty, or breach or failure
to comply with any covenant, of the Purchaser, contained in the this
Subscription Agreement. Notwithstanding any of the representations, warranties,
acknowledgments or agreements made herein by the Purchaser, the Purchaser does
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not thereby or in any other manner waive any rights granted to the Purchaser
under federal or state securities laws.
6. Provisions of Certain State Laws.
IN MAKING AN INVESTMENT DECISION INVESTORS MUST RELY ON THEIR OWN EXAMINATION OF
THE ISSUER INCLUDING THE MERITS AND RISKS INVOLVED. THESE SECURITIES HAVE NOT
BEEN RECOMMENDED BY ANY FEDERAL OR STATE SECURITIES COMMISSION OR REGULATORY
AUTHORITY. FURTHERMORE, THE FOREGOING AUTHORITIES HAVE NOT CONFIRMED THE
ACCURACY OR DETERMINED THE ADEQUACY OF THIS DOCUMENT. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND
MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE SECURITIES ACT OF
1933, AS AMENDED, AND THE APPLICABLE STATE SECURITIES LAWS. PURSUANT TO
REGISTRATION OR EXEMPTION THEREOF, INVESTORS SHOULD BE AWARE THAT THEY MAY BE
REQUIRED TO BEAR THE FINANCIAL, RISKS OF THIS INVESTMENT FOR AN INDEFINITE
PERIOD OF TIME.
THE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE NEW YORK UNIFORM SECURITIES
ACT AND, THEREFORE, CANNOT BE RESOLD UNLESS THEY ARE REGISTERED UNDER THE ACT OR
UNLESS AN EXEMPTION FROM REGISTRATION IS AVAILABLE.
7. Additional Information.
The Purchaser hereby acknowledges and agrees that the Company may make or cause
to be made such further inquiry and obtain such additional information as they
may deem appropriate, with regard to the suitability of the undersigned.
Irrevocability; Binding Effect,
The Purchaser hereby acknowledges and agrees that the Subscription hereunder is
irrevocable, that the Purchaser is not entitled to cancel, terminate or revoke
this Subscription Agreement or any agreements of the undersigned there under and
that this Subscription Agreement and such other agreements shall survive the
death or disability of the Purchaser and shall be binding upon and inure to the
benefit of the parties and their heirs, executors, administrators, successors,
legal representatives and assigns. If the Purchaser is more than one person, the
obligations of the Purchaser hereunder shall be joint and several and the
agreements, representations, warranties and acknowledgments herein contained
shall he deemed to he made by and be binding upon each such person and his heirs
executor, legal representatives and assigns.
8. Modification.
Neither this Subscription Agreement nor any provisions hereof shall he waived,
modified, discharged or terminated except by an instrument in writing signed by
the party against whom any such waiver, modification, discharge or termination
is sought.
9. Notices.
Any notice, demand or other communication which any party hereto may he
required, or may elect to give to any other party hereunder shall be
sufficiently given if (a) deposited, postage prepaid, in a United States or
county of residence mail box, stamped registered or certified mail, return
receipt requested, addressed to such address 48 may he listed on the books of
the Company, or (b) delivered personally at such address.
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10. Counterparts.
This Subscription Agreement may he executed through the use of separate
signature pages or in any number of counterparts and each such counterpart shall
for all purposes, constitute one agreement binding on all parties,
notwithstanding that all parties are not signatories to the same counterpart.
11. Entire Agreement.
This subscription Agreement contains the entire agreement of the parties with
respect to the subject matter hereof and there are no representations, covenants
or other agreements except as stated or referred to herein.
12. Severability,
Each provision of this Subscription Agreement is intended to be severable from
every other provision, and the invalidity or illegality or any Portion hereof
shall not affect the validity or legality of the remainder hereof.
13. Assignability.
This Subscription Agreement is not transferable or assignable by the Purchaser.
14. Applicable Law,
This Subscription Agreement shall be governed by and construed in accordance
with the laws of the State of Delaware as applied to residents of that State
executing contracts wholly to be performed in that State.
15. Choice of Jurisdiction.
The parties agree that any action or proceeding arising, directly, indirectly or
otherwise, in connection with, out of or from this Subscription Agreement, any
breach hereof or any transaction covered hereby shall be resolved within the
State of Delaware. Accordingly, the parties consent and submit to the
jurisdiction of the United States federal and state courts located within the
State or Delaware.
IN WITNESS THEREOF, the undersigned exercises and agrees to be hound by this
Subscription Agreement by executing the Signature Page attached hereto on the
date therein indicated.
REST OF PAGE INTENTIONALLY LEFT BLANK
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SUBSCRIPTION AGREEMENT
SIGNATURE PAGE
By executing this Signature Page, the undersigned hereby executes, adopts and
agrees to all terms, conditions and representations of this Subscription
Agreement and acknowledges all requirements are met by the purchaser to purchase
Shares in the Company.
Number of Units Subscribed at $0.75 per Share: __________
Aggregate Purchase Price: USD ___________
(Each unit is one common share and one warrant at strike price of $.82
exercisable within 24 months)
Type of ownership: ________ Individual
________ Joint Tenant
________ Tenants by the Entirety
________ Tenants in Common
________ Subscribing as Corporation or Partnership
IN WITNESS WHEREOF, the undersigned Purchaser has executed this Signature Page
this _____ day or _________, 2011.
Exact Name in which Shares are to be Registered
-------------------------------
Signature
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Print Name
-------------------------------
Tax Identification Number
-------------------------------
-------------------------------
-------------------------------
Zip Code ----------------------
Mailing Address
-------------------------------
Residence Phone Number
-------------------------------
Work Phone Number
-------------------------------
Email Address
ACCEPTANCE OF SUBSCRIPTION
LIBERTY COAL ENERGY CORP. hereby accepts the subscription of ___________Share,
as of the _________day of ___________, 2011/
LIBERTY COAL ENERGY CORP.
By:
----------------------------
Name:
--------------------------
Title:
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