Exhibit 10.2
FINANCING AGREEMENT
FINANCING AGREEMENT dated the 27th day of January, 2012
BETWEEN:
Right Power Services Ltd., a British Virgin Islands company (hereinafter, the
"SUBSCRIBER")
AND:
WEB WIZARD, INC., a Nevada domestic corporation of Xx. 0, Xxxx 00, Xxxx Xxxx,
Xxx CunHuicheng, Xxx Xxx, Jiang Men City, China (hereinafter, the "COMPANY")
NOW THEREFORE THIS FINANCING AGREEMENT ("AGREEMENT") WITNESSES that the parties
hereto agree as follows:
ARTICLE 1- INVESTMENTS
SECTION 1.1. INVESTMENTS
The Subscriber shall invest a total of US $745,000 through private placements
into the Company. The private placements shall take place as follows:
* US $245,000 upon the closing of an asset acquisition agreement between
the Company and PFN Holdings. (the "Acquisition") at a price of
US$0.75 per share;
* US $250,000 within thirty one (31) days of the closing of the
Acquisition at a price per share that is the higher of
* $0.75; or
* 90% of the average of the closing prices of the Company's common
stock for ten trading immediately preceding the date of the
investment, as quoted on Yahoo Finance or other source of stock
quotes as agreed to by the parties; and
* US $250,000 within ninety (90) days of the closing of the Acquisition
at at a price per share that is the higher of
* $0.75; or
* 90% of the average of the closing prices of the Company's common
stock for ten trading immediately preceding the date of the
investment, as quoted on Yahoo Finance or other source of stock
quotes as agreed to by the parties; and
SECTION 1.2. SUBSCRIPTION AGREEMENT.
Upon making each investment, the Subscriber shall provide an executed
Subscription Agreement, in a form substantially similar to the attached Exhibit
B.
SECTION 1.3. USE OF PROCEEDS.
The Company shall use all investments to fund operating expenses, acquisitions,
working capital and general corporate activities as outlined in Exhibit A
attached hereto and all investments shall be subject to adherence to the
attached used of proceeds by the Company.
ARTICLE 2 - REPRESENTATIONS AND WARRANTIES
SECTION 2.1. REPRESENTATIONS AND WARRANTIES.
The Company represents and warrants to the Subscriber:
(a) Organization and Corporate Power. The Company has been duly incorporated
and organized and is validly subsisting and in good standing under the laws
of its jurisdiction and has full corporate right, power and authority to
enter into and perform its obligations under the Agreement to which it is
or shall be a party and has full corporate right, power and authority to
own and operate its properties and to carry on its business;
(b) Conflict with Other Instruments. The execution and delivery by the Company
of the Agreement and the performance by the Company of its obligations
thereunder, do not and will not: (i) conflict with or result in a breach of
any of the terms, conditions or provisions of: (A) the charter documents of
the Company; (B) any law applicable to or binding on the Company; or (C)
any contractual restriction binding on or affecting the Company or its
properties the breach of which would have a material adverse effect on the
Company; or (ii) result in, or require or permit: (A) the imposition of any
lien on or with respect to the properties now owned or hereafter acquired
by the Company; or (B) The acceleration of the maturity of any debt of the
Company, under any contractual provision binding on or affecting the
Company;
(c) Consents, Official Body Approvals. The execution and delivery of the
Agreement and the performance by the Company of its obligations thereunder
have been duly authorized by all necessary action on the part of the
Company, and no Consent under any applicable law and no registration,
qualification, designation, declaration or filing with any official body
having jurisdiction over the Company is or was necessary therefore. The
Company possesses all Consents, in full force and effect, under any
applicable Law which are necessary in connection with the operation of its
business, the non-possession of which could reasonably be expected to have
a material adverse effect on the Company;
(d) Execution of Binding Obligation. The Agreement has been duly executed and
delivered by the Company and, when duly executed by the Company and
delivered for value, the Agreement will constitute legal, valid and binding
obligations of the Company, enforceable against the Company, in accordance
with its terms;
(e) No Litigation. There are no actions, suits or proceedings pending or, to
the knowledge of the Company, after due inquiry, threatened against or
affecting the Company (nor, to the knowledge of the Company, after due
inquiry, any basis therefor) before any official body having jurisdiction
over the Company which purport to or do challenge the validity or propriety
of the transactions contemplated by the Share Issuance the Company, which
if adversely determined could reasonably be expected to have a material
adverse effect on the Company;
(f) Absence of Changes. Since the date of the most recently delivered financial
statements of the Company, the Company has carried on its business,
operations and affairs only in the ordinary and normal course consistent
with past practice.
ARTICLE 3 - COVENANTS OF THE COMPANY
SECTION 3.1. AFFIRMATIVE COVENANTS.
Until the Completion Date, the Company shall:
(a) COMPLIANCE WITH LAWS, ETC. Comply with all applicable laws, non-compliance
with which could have a material adverse effect on the Company;
(b) PAYMENT OF TAXES AND CLAIMS. Pay and discharge before the same shall become
delinquent: (i) all taxes and assessments; and (ii) all lawful claims
which, if unpaid, might become a lien upon or in respect of the Company's
assets or properties;
(c) MAINTAIN TITLE. Maintain and, as soon as reasonably practicable, defend and
take, all action necessary or advisable at any time, and from time to time,
to maintain, defend, exercise or renew its right, title and interest in and
to all of its property and assets;
(d) PAY OBLIGATIONS TO SUBSCRIBER AND PERFORM OTHER COVENANTS. Make full and
timely payment of its obligations hereunder and duly comply with the terms
and covenants contained in this Agreement, all at the times and places and
in the manner set forth therein;
(e) FURTHER ASSURANCES. At its cost and expense, upon request by the
Subscriber, duly execute and deliver, or cause to be duly executed and
delivered, to the Subscriber, such further instruments and do and cause to
be done such other acts as may be necessary or proper in the reasonable
opinion of the Subscriber to carry out more effectually the provisions and
purposes of this Agreement.
ARTICLE 4 - SHARE ISSUANCE
SECTION 4.1 SHARE ISSUANCE.
The Company shall issue, within ten (10) Banking Days following the date of the
receipt by the Company of any investment under this Agreement, common shares of
the Company (each a "SHARE") at the specified share price. Upon receipt of any
investment under this Agreement, the Company shall promptly cause its registrar
and transfer agent to issue the certificates representing the Shares.
SECTION 4.2 FRACTIONAL SHARES.
Notwithstanding any other provisions of this Agreement, no certificate for
fractional shares of the Shares shall be issued to the Subscriber. In lieu of
any such fractional shares, if the Subscriber would otherwise be entitled to
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receive a fraction of a share of the Shares following a Share Issuance, the
Subscriber shall be entitled to receive from the Company a stock certificate
representing the nearest whole number of shares of the Company.
ARTICLE 5 - MISCELLANEOUS
SECTION 5.1. NOTICES, ETC.
Except as otherwise expressly provided herein, all notices, requests, demands,
directions and communications by one party to the other shall be sent by hand
delivery or registered mail or fax, and shall be effective when hand delivered
or when delivered by the relevant postal service or when faxed and confirmed, as
the case may be. All such notices shall be addressed to the President of the
notified party at its address given on the signature page of this Agreement, or
in accordance with any unrevoked written direction from such party to the other
party.
SECTION 5.2. NO WAIVER; REMEDIES.
No failure on the part of the Subscriber or the Company to exercise, and no
delay in exercising, any right under this Agreement shall operate as a waiver
thereof. The remedies herein provided are cumulative and not exclusive of any
remedies provided by Law.
SECTION 5.3. JURISDICTION.
(1) Each of the parties hereby irrevocably attorns to the non-exclusive
jurisdiction of the Courts of the State of Nevada in any action or proceeding
arising out of or relating to this Agreement. The Company agrees that a final
judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by Law; and (2) nothing in this Section 5.3 shall affect the right of
the Subscriber to serve legal process in any other manner permitted by Law or
affect the right of the Subscriber to bring any action or proceeding against the
Company or its property in the courts of other jurisdictions.
SECTION 5.4. SUCCESSORS AND ASSIGNS.
The Company shall not have the right to assign its rights hereunder or any
interest herein without the prior written consent of the Subscriber, which
consent may be arbitrarily withheld.
SECTION 5.5. SEVERABILITY.
If one or more provisions of this Agreement be or become invalid, or
unenforceable in whole or in part in any jurisdiction, the validity of the
remaining provisions of this Agreement shall not be affected. The parties hereto
undertake to replace any such invalid provision without delay with a valid
provision which as nearly as possible duplicates the economic intent of the
invalid provision.
SECTION 5.6. COUNTERPARTS.
This Agreement may be executed in counterparts and by different parties in
separate counterparts, each of which when so executed shall be deemed an
original and all of which, taken together, shall constitute one and the same
instrument.
SECTION 5.7. SYNDICATION/PARTICIPATION.
The Subscriber may not sell, transfer, assign, participate, syndicate or
negotiate to one or more third parties, in whole or in part, the Commitment and
its rights under this Agreement, without the prior written consent of the
Company, which consent may not be arbitrarily withheld.
SECTION 5.8. ACKNOWLEDGMENT
The Subscriber acknowledges that if it fails to comply with the financing
requirements outlined in Section 1.1 and does not close on the two $250,000
post-closing tranches, PFN Holdings shall be issued extra shares in the Company,
and thus dilute the Subscriber's interest. If the Subscriber does not close on
any of the two post-closing tranches, PFN Holdings shall be issued 70,000,000
additional shares of the Company. If the Subscriber closes on only one of the
post-closing tranches, PFN Holdings shall be issued and additional 30,000,000
shares of the Company.
IN WITNESS WHEREOF the parties hereto have caused this Agreement to be executed
by their respective officers thereunto duly authorized, as of the date first
above written.
THE SUBSCRIBER THE COMPANY
Right Power Services Ltd. Web Wizard, Inc.
-------------------------
By: /s/ Xxxxx Xxx By: /s/ Ya Xxxx Xxxx
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Authorized Signing Officer Authorized Signing Officer
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EXHIBIT A
PFN Use of Funds
Expense Month 1 Month 2 Month 3 Month 4 Month 5 Month 6
------- ------- ------- ------- ------- ------- -------
Investor Funds $250,000 $250,000 $750,000
Software Development $ 25,000 $ 25,000 $ 25,000 $ 10,000 $ 5,000 $ 5,000
Mobile App Development $ 10,000 $ 10,000 $ 10,000 $ 10,000 $ 500 $ 500
Business Insurance(s) $ 2,500 $ 0 $ 0 $ 0 $ 0 $ 0
Public Relations $ 0 $ 0 $ 2,500 $ 2,500 $ 2,500 $ 2,500
Legal $ 10,000 $ 0 $ 0 $ 5,000 $ 0 $ 0
Accounting & Bookkeeping $ 2,500 $ 0 $ 0 $ 2,500 $ 0 $ 0
General and Administrative $ 15,000 $ 15,000 $ 20,000 $ 20,000 $ 25,000 $ 25,000
SEO - Search Engine Optimization $ 2,500 $ 2,500 $ 2,500 $ 2,500 $ 2,500 $ 2,500
Travel Expenses $ 1,500 $ 1,500 $ 1,500 $ 1,500 $ 1,500 $ 1,500
Miscellaneous Expenses $ 1,000 $ 1,000 $ 1,000 $ 1,000 $ 1,000 $ 1,000
Hosting & Servers $ 250 $ 250 $ 250 $ 750 $ 750 $ 750
Marketing $ 0 $ 0 $ 5,000 $ 10,000 $ 20,000 $ 30,000
Monthly Total Expenses $ 70,250 $ 55,250 $ 67,750 $ 65,750 $ 58,750 $ 68,750
Remaining Dollars $179,750 $374,500 $306,750 $241,000 $432,250 $363,500
PFN Use of Funds
Expense Month 7 Month 8 Month 9 Totals Months 6-9
------- ------- ------- ------- ------ ----------
Investor Funds $250,000
Software Development $ 5,000 $ 5,000 $ 5,000 $110,000
Mobile App Development $ 500 $ 500 $ 500 $ 42,500
Business Insurance(s) $ 0 $ 0 $ 0 $ 2,500
Public Relations $ 2,500 $ 2,500 $ 2,500 $ 17,500
Legal $ 5,000 $ 0 $ 0 $ 20,000
Accounting & Bookkeeping $ 2,500 $ 0 $ 0 $ 7,500
General and Administrative $ 25,000 $ 30,000 $ 30,000 $205,000
SEO - Search Engine Optimization $ 2,500 $ 2,500 $ 2,500 $ 22,500
Travel Expenses $ 1,500 $ 1,500 $ 1,500 $ 13,500
Miscellaneous Expenses $ 1,000 $ 1,000 $ 1,000 $ 9,000
Hosting & Servers $ 1,000 $ 1,000 $ 1,000 $ 6,000
Marketing $ 50,000 $ 75,000 $100,000 $290,000 $225,000
Monthly Total Expenses $ 96,500 $119,000 $144,000 $746,000 $359,500
Remaining Dollars $267,000 $148,000 $ 4,000 63%
** Notice in months 7-9, Marketing accounts for approximately 63% of the total
budget.
This will continue to increase as we progress. The more we can spend on
marketing, the more we will succeed.
EXHIBIT B
THIS PRIVATE PLACEMENT SUBSCRIPTION AGREEMENT (THE "SUBSCRIPTION AGREEMENT")
RELATES TO AN OFFERING OF SECURITIES IN AN OFFSHORE TRANSACTION TO PERSONS WHO
ARE NOT U.S. PERSONS (AS DEFINED HEREIN) PURSUANT TO REGULATION S UNDER THE
UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT").
NONE OF THE SECURITIES TO WHICH THIS SUBSCRIPTION AGREEMENT RELATES HAVE BEEN
REGISTERED UNDER THE 1933 ACT, OR ANY U.S. STATE SECURITIES LAWS, AND, UNLESS SO
REGISTERED, NONE MAY BE OFFERED OR SOLD, DIRECTLY OR INDIRECTLY, IN THE UNITED
STATES OR TO U.S. PERSONS (AS DEFINED HEREIN) EXCEPT IN ACCORDANCE WITH THE
PROVISIONS OF REGULATION S UNDER THE 1933 ACT, PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE 1933 ACT, OR PURSUANT TO AN AVAILABLE EXEMPTION
FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE
1933 ACT AND IN EACH CASE ONLY IN ACCORDANCE WITH APPLICABLE STATE SECURITIES
LAWS.
PRIVATE PLACEMENT SUBSCRIPTION
FOR NON U.S. SUBSCRIBERS
WEB WIZARD, INC.
Xx. 0, Xxxx 00, Xxxx Xxxx, Xxx CunHuicheng,
Xxx Xxx, Jiang Men City, China
PRIVATE PLACEMENT
INSTRUCTIONS TO SUBSCRIBER:
1. COMPLETE the information on page 2 of this Subscription Agreement.
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WEB WIZARD, INC.
PRIVATE PLACEMENT
The Subscriber hereby irrevocably subscribes for, and on Closing will purchase
from the Company, the following securities at a price of US$0.______ per Share
__________________ Shares
The Subscriber directs the Company to issue, register and deliver the
certificates representing the Shares as follows:
REGISTRATION INSTRUCTIONS: DELIVERY INSTRUCTIONS:
----------------------------- -----------------------------
Name to appear on certificate Name and account reference,
if applicable
----------------------------- -----------------------------
SIN/Tax ID No. Contact name
----------------------------- -----------------------------
Address Address
----------------------------- -----------------------------
Telephone number
EXECUTED by the Subscriber this _______ day of__________, _____. By executing
this Agreement, the Subscriber certifies that the Subscriber and any beneficial
purchaser for whom the Subscriber is acting is resident in the jurisdiction
shown as the "Address of the Subscriber". The address of the Subscriber will be
accepted by the Company as a representative as to the address of residency for
the Subscriber.
WITNESS: EXECUTION BY SUBSCRIBER:
X
----------------------------- -----------------------------
Signature of witness Signature of individual (if
Subscriber is an individual)
X
----------------------------- -----------------------------
Name of witness Authorized signatory (if
Subscriber is not an
individual)
----------------------------- -----------------------------
Address of witness Name of Subscriber (please
print)
----------------------------- -----------------------------
Name of authorized signatory
(please print)
ACCEPTED this __ day of ______, ___.
WEB WIZARD, INC.
----------------------------- -----------------------------
Per: Address of Subscriber
(residence)
----------------------------- -----------------------------
Authorized signatory Telephone number and e-mail
address
By signing this acceptance, the Company agrees to be bound by all
representations, warranties, covenants and agreements on pages 3-11 hereof.
This Subscription Agreement may be executed in any number of counterparts, each
of which, when so executed and delivered, shall constitute an original and all
of which together shall constitute one instrument. Delivery of an executed copy
of this Subscription Agreement by electronic facsimile transmission or other
means of electronic communication capable of producing a printed copy will be
deemed to be execution and delivery of this Subscription Agreement as of the
date hereinafter set forth.
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THIS PRIVATE PLACEMENT SUBSCRIPTION AGREEMENT (THE "SUBSCRIPTION AGREEMENT")
RELATES TO AN OFFERING OF SECURITIES IN AN OFFSHORE TRANSACTION TO PERSONS WHO
ARE NOT U.S. PERSONS (AS DEFINED HEREIN) PURSUANT TO REGULATION S UNDER THE
UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT").
NONE OF THE SECURITIES TO WHICH THIS SUBSCRIPTION AGREEMENT RELATES HAVE BEEN
REGISTERED UNDER THE 1933 ACT, OR ANY U.S. STATE SECURITIES LAWS, AND, UNLESS SO
REGISTERED, NONE MAY BE OFFERED OR SOLD, DIRECTLY OR INDIRECTLY, IN THE UNITED
STATES OR TO U.S. PERSONS (AS DEFINED HEREIN) EXCEPT IN ACCORDANCE WITH THE
PROVISIONS OF REGULATION S UNDER THE 1933 ACT, PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE 1933 ACT, OR PURSUANT TO AN AVAILABLE EXEMPTION
FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE
1933 ACT AND IN EACH CASE ONLY IN ACCORDANCE WITH APPLICABLE STATE SECURITIES
LAWS.
PRIVATE PLACEMENT SUBSCRIPTION
(Non U.S. Subscribers Only)
TO: WEB WIZARD, INC. (the "Company")
Purchase of Shares
1. Subscription
1.1 The undersigned (the "Subscriber") hereby irrevocably subscribes for and
agrees to purchase the number of shares of the Company's common stock (the
"Shares") as set out on page 2 of this Subscription Agreement at a price of
US$0.____________ per Share (such subscription and agreement to purchase being
the "Subscription"), for $_______________ (the "Subscription Proceeds"), which
Subscription Proceeds are tendered herewith, on the basis of the representations
and warranties and subject to the terms and conditions set forth herein. The
Shares are referred to as the "Securities".
1.2 The Company hereby agrees to sell, on the basis of the representations and
warranties and subject to the terms and conditions set forth herein, to the
Subscriber the Shares. Subject to the terms hereof, the Subscription Agreement
will be effective upon its acceptance by the Company.
1.3 Unless otherwise provided, all dollar amounts referred to in this
Subscription Agreement are in lawful money of the United States of America.
2. Payment
2.1 The Subscription Proceeds must accompany this Subscription Agreement. The
Subscriber authorizes the Company's lawyers to deliver the Subscription Proceeds
to the Company if the Subscription Proceeds are delivered to the Company's
lawyers, without further instructions required.
2.2 The Subscriber acknowledges and agrees that this Subscription Agreement and
any other documents delivered in connection herewith will be held by the
Company's lawyers on behalf of the Company. In the event that this Subscription
Agreement is not accepted by the Company for whatever reason within 90 days of
the delivery of an executed Subscription Agreement by the Subscriber, or the
minimum offering amount is not achieved by that time, this Subscription
Agreement, the Subscription Proceeds and any other documents delivered in
connection herewith will be returned to the Subscriber at the address of the
Subscriber as set forth in this Subscription Agreement without interest or
deduction.
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2.3 Where the Subscription Proceeds are paid to the Company, the Company may
treat the Subscription Proceeds as a non-interest bearing loan and may use the
Subscription Proceeds prior to this Subscription Agreement being accepted by the
Company.
2.4 The Subscriber shall complete, sign and return to the Company as soon as
possible, on request by the Company, any documents, questionnaires, notices and
undertakings as may be required by regulatory authorities, stock exchanges and
applicable law.
3. Closing
3.1 Closing of the purchase and sale of the Shares shall occur on such date as
may be determined by the Company in its sole discretion (the "Closing Date").
The Subscriber acknowledges that Shares may be issued to other subscribers under
this offering (the "Offering") before or after the Closing Date. The Company,
may, at its discretion, elect to close the Offering in one or more closings, in
which event the Company may agree with one or more subscribers (including the
Subscriber hereunder) to complete delivery of the Shares to such subscriber(s)
against payment therefore at any time on or prior to the Closing Date.
4. Acknowledgements of Subscriber
4.1 The Subscriber acknowledges and agrees that:
(a) none of the Securities have been registered under the Securities Act
of 1933, as amended (the "1933 Act"), or under any state securities or
"blue sky" laws of any state of the United States, and are being
offered only in a transaction not involving any public offering within
the meaning of the 1933 Act, and, unless so registered, may not be
offered or sold in the United States or to U.S. Persons (as defined
herein), except pursuant to an effective registration statement under
the 1933 Act, or pursuant to an exemption from, or in a transaction
not subject to, the registration requirements of the 1933 Act, and in
each case only in accordance with applicable state and provincial
securities laws;
(b) the Company will refuse to register any transfer of any of the
Securities not made in accordance with the provisions of Regulation S,
pursuant to an effective registration statement under the 1933 Act or
pursuant to an available exemption from, or in a transaction not
subject to, the registration requirements of the 1933 Act;
(c) the decision to execute this Subscription Agreement and purchase the
Shares agreed to be purchased hereunder has not been based upon any
oral or written representation as to fact or otherwise made by or on
behalf of the Company;
(d) the Subscriber and the Subscriber's advisor(s) have had a reasonable
opportunity to review the Company Information and to ask questions of
and receive answers from the Company regarding the Offering, and to
obtain additional information, to the extent possessed or obtainable
without unreasonable effort or expense, necessary to verify the
accuracy of the information contained in the Company Information, or
any other document provided to the Subscriber;
(e) the books and records of the Company were available upon reasonable
notice for inspection, subject to certain confidentiality
restrictions, by the Subscriber during reasonable business hours at
its principal place of business and that all documents, records and
books pertaining to this Offering have been made available for
inspection by the Subscriber, the Subscriber's attorney and/or
advisor(s);
(f) by execution hereof the Subscriber has waived the need for the Company
to communicate its acceptance of the purchase of the Shares pursuant
to this Subscription Agreement;
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(g) the Company is entitled to rely on the representations and warranties
and the statements and answers of the Subscriber contained in this
Subscription Agreement and the Subscriber will hold harmless the
Company from any loss or damage it may suffer as a result of the
Subscriber's failure to correctly complete this Subscription
Agreement;
(h) the Subscriber will indemnify and hold harmless the Company and, where
applicable, its respective directors, officers, employees, agents,
advisors and shareholders from and against any and all loss,
liability, claim, damage and expense whatsoever (including, but not
limited to, any and all fees, costs and expenses whatsoever reasonably
incurred in investigating, preparing or defending against any claim,
lawsuit, administrative proceeding or investigation whether commenced
or threatened) arising out of or based upon any acknowledgment,
representation or warranty of the Subscriber contained herein or in
any other document furnished by the Subscriber to the Company in
connection herewith, being untrue in any material respect or any
breach or failure by the Subscriber to comply with any covenant or
agreement made by the Subscriber to the Company in connection
therewith;
(i) the issuance and sale of the Shares to the Subscriber will not be
completed if it would be unlawful or if, in the discretion of the
Company acting reasonably, it is not in the best interests of the
Company;
(j) the Subscriber has been advised to consult the Subscriber's own legal,
tax and other advisors with respect to the merits and risks of an
investment in the Securities and with respect to the applicable resale
restrictions, and it is solely responsible (and the Company is not in
any way responsible) for compliance with:
(i) any applicable laws of the jurisdiction in which the Subscriber
is resident in connection with the distribution of the Securities
hereunder, and
(ii) applicable resale restrictions;
(k) the Subscriber has not acquired the Shares as a result of, and will
not itself engage in, any "directed selling efforts" (as defined in
Regulation S under the 0000 Xxx) in the United States in respect of
any of the Securities which would include any activities undertaken
for the purpose of, or that could reasonably be expected to have the
effect of, conditioning the market in the United States for the resale
of any of the Securities; provided, however, that the Subscriber may
sell or otherwise dispose of any of the Shares pursuant to
registration of any of the Shares pursuant to the 1933 Act and any
applicable state securities laws or under an exemption from such
registration requirements and as otherwise provided herein;
(l) the Subscriber is outside the United States when receiving and
executing this Subscription Agreement and is acquiring the Shares as
principal for its own account, for investment purposes only, and not
with a view to, or for, resale, distribution or fractionalization
thereof, in whole or in part, and no other person has a direct or
indirect beneficial interest in such Shares;
(m) the statutory and regulatory basis for the exemption claimed for the
offer and sale of the Shares, although in technical compliance with
Regulation S, would not be available if the offering is part of a plan
or scheme to evade the registration provisions of the 1933 Act;
(n) none of the Securities are listed on any stock exchange or automated
dealer quotation system and no representation has been made to the
Subscriber that any of the Securities will become listed on any stock
exchange or automated dealer quotation system;
(o) neither the SEC nor any other securities commission or similar
regulatory authority has reviewed or passed on the merits of any of
the Securities;
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(p) no documents in connection with this Offering have been reviewed by
the SEC or any state securities administrators;
(q) there is no government or other insurance covering any of the
Securities; and
(r) this Subscription Agreement is not enforceable by the Subscriber
unless it has been accepted by the Company, and the Subscriber
acknowledges and agrees that the Company reserves the right to reject
any subscription for any reason.
5. Representations, Warranties and Covenants of the Subscriber
5.1 The Subscriber hereby represents and warrants to and covenants with the
Company (which representations, warranties and covenants shall survive the
Closing Date) that:
(a) the Subscriber is not a U.S. Person (as defined herein);
(b) the Subscriber is not acquiring the Shares for the account or benefit
of, directly or indirectly, any U.S. Person (as defined herein);
(c) the Subscriber is resident in the jurisdiction set out on page 2 of
this Subscription Agreement;
(d) the Subscriber:
(i) is knowledgeable of, or has been independently advised as to, the
applicable securities laws of the securities regulators having
application in the jurisdiction in which the Subscriber is
resident (the "International Jurisdiction") which would apply to
the acquisition of the Shares,
(ii) is purchasing the Shares pursuant to exemptions from prospectus
or equivalent requirements under applicable securities laws or,
if such is not applicable, the Subscriber is permitted to
purchase the Shares under the applicable securities laws of the
securities regulators in the International Jurisdiction without
the need to rely on any exemptions,
(iii)acknowledges that the applicable securities laws of the
authorities in the International Jurisdiction do not require the
Company to make any filings or seek any approvals of any kind
whatsoever from any securities regulator of any kind whatsoever
in the International Jurisdiction in connection with the issue
and sale or resale of any of the Securities, and
(iv) represents and warrants that the acquisition of the Shares by the
Subscriber does not trigger:
A. any obligation to prepare and file a prospectus or similar
document, or any other report with respect to such purchase
in the International Jurisdiction, or
B. any continuous disclosure reporting obligation of the
Company in the International Jurisdiction, and
the Subscriber will, if requested by the Company, deliver to the
Company a certificate or opinion of local counsel from the
International Jurisdiction which will confirm the matters
referred to in subparagraphs (ii), (iii) and (iv) above to the
satisfaction of the Company, acting reasonably;
(e) the Subscriber is acquiring the Shares as principal for investment
only and not with a view to, or for, resale, distribution or
fractionalization thereof, in whole or in part, and, in particular, it
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has no intention to distribute either directly or indirectly any of
the Securities in the United States or to U.S. Persons (as defined
herein);
(f) the Subscriber is outside the United States when receiving and
executing this Subscription Agreement;
(g) the Subscriber understands and agrees not to engage in any hedging
transactions involving any of the Securities unless such transactions
are in compliance with the provisions of the 1933 Act and in each case
only in accordance with applicable state securities laws;
(h) the Subscriber acknowledges that it has not acquired the Shares as a
result of, and will not itself engage in, any "directed selling
efforts" (as defined in Regulation S under the 0000 Xxx) in the United
States in respect of any of the Securities which would include any
activities undertaken for the purpose of, or that could reasonably be
expected to have the effect of, conditioning the market in the United
States for the resale of any of the Securities; provided, however,
that the Subscriber may sell or otherwise dispose of any of the Shares
pursuant to registration of any of the Shares pursuant to the 1933 Act
and any applicable state securities laws or under an exemption from
such registration requirements and as otherwise provided herein;
(i) the Subscriber has the legal capacity and competence to enter into and
execute this Subscription Agreement and to take all actions required
pursuant hereto and, if the Subscriber is a corporation, it is duly
incorporated and validly subsisting under the laws of its jurisdiction
of incorporation and all necessary approvals by its directors,
shareholders and others have been obtained to authorize execution and
performance of this Subscription Agreement on behalf of the
Subscriber;
(j) the entering into of this Subscription Agreement and the transactions
contemplated hereby do not result in the violation of any of the terms
and provisions of any law applicable to, or, if applicable, the
constating documents of, the Subscriber, or of any agreement, written
or oral, to which the Subscriber may be a party or by which the
Subscriber is or may be bound;
(k) the Subscriber has duly executed and delivered this Subscription
Agreement and it constitutes a valid and binding agreement of the
Subscriber enforceable against the Subscriber;
(l) the Subscriber has received and carefully read this Subscription
Agreement;
(m) the Subscriber (i) has adequate net worth and means of providing for
its current financial needs and possible personal contingencies, (ii)
has no need for liquidity in this investment, and (iii) is able to
bear the economic risks of an investment in the Securities for an
indefinite period of time, and can afford the complete loss of such
investment;
(n) the Subscriber has the requisite knowledge and experience in financial
and business matters as to be capable of evaluating the merits and
risks of the investment in the Securities and the Company, and the
Subscriber is providing evidence of knowledge and experience in these
matters;
(o) the Subscriber understands and agrees that the Company and others will
rely upon the truth and accuracy of the acknowledgements,
representations, warranties, covenants and agreements contained in
this Subscription Agreement and agrees that if any of such
acknowledgements, representations and agreements are no longer
accurate or have been breached, the Subscriber shall promptly notify
the Company;
(p) the Subscriber is aware that an investment in the Company is
speculative and involves certain risks, including the possible loss of
the investment;
(q) the Subscriber is purchasing the Shares for its own account for
investment purposes only and not for the account of any other person
and not for distribution, assignment or resale to others, and no other
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person has a direct or indirect beneficial interest is such Shares,
and the Subscriber has not subdivided his interest in the Shares with
any other person;
(r) the Subscriber is not an underwriter of, or dealer in, the shares of
the Company's common stock, nor is the Subscriber participating,
pursuant to a contractual agreement or otherwise, in the distribution
of the Shares;
(s) the Subscriber has made an independent examination and investigation
of an investment in the Securities and the Company and has depended on
the advice of its legal and financial advisors and agrees that the
Company will not be responsible in anyway whatsoever for the
Subscriber's decision to invest in the Securities and the Company;
(t) if the Subscriber is acquiring the Shares as a fiduciary or agent for
one or more investor accounts, the Subscriber has sole investment
discretion with respect to each such account, and the Subscriber has
full power to make the foregoing acknowledgements, representations and
agreements on behalf of such account;
(u) the Subscriber is not aware of any advertisement of any of the Shares
and is not acquiring the Shares as a result of any form of general
solicitation or general advertising including advertisements,
articles, notices or other communications published in any newspaper,
magazine or similar media or broadcast over radio or television, or
any seminar or meeting whose attendees have been invited by general
solicitation or general advertising;
(v) no person has made to the Subscriber any written or oral
representations:
(i) that any person will resell or repurchase any of the Securities,
(ii) that any person will refund the purchase price of any of the
Securities,
(iii) as to the future price or value of any of the Securities, or
(iv) that any of the Securities will be listed and posted for trading
on any stock exchange or automated dealer quotation system or
that application has been made to list and post any of the
Securities of the Company on any stock exchange or automated
dealer quotation system; and
(w) the Subscriber acknowledges and agrees that the Company shall not
consider the Subscriber's Subscription for acceptance unless the
undersigned provides to the Company, along with an executed copy of
this Subscription Agreement:
(i) such other supporting documentation that the Company or its legal
counsel may request to establish the Subscriber's qualification
as a qualified investor.
5.2 In this Subscription Agreement, the term "U.S. Person" shall have the
meaning ascribed thereto in Regulation S promulgated under the 1933 Act and for
the purpose of the Subscription Agreement includes any person in the United
States.
6. Acknowledgement and Waiver
6.1 The Subscriber has acknowledged that the decision to purchase the Shares was
solely made on the Company Information. The Subscriber hereby waives, to the
fullest extent permitted by law, any rights of withdrawal, rescission or
compensation for damages to which the Subscriber might be entitled in connection
with the distribution of any of the Shares.
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7. Representations and Warranties will be Relied Upon by the Company
7.1 The Subscriber acknowledges that the acknowledgements, representations and
warranties contained herein are made by it with the intention that they may be
relied upon by the Company and its legal counsel in determining the Subscriber's
eligibility to purchase the Shares under applicable securities legislation, or
(if applicable) the eligibility of others on whose behalf it is contracting
hereunder to purchase the Shares under applicable securities legislation. The
Subscriber further agrees that by accepting delivery of the certificates
representing the Shares, it will be representing and warranting that the
acknowledgements representations and warranties contained herein are true and
correct as of the date hereof and will continue in full force and effect
notwithstanding any subsequent disposition by the Subscriber of such Shares.
8. Resale Restrictions
8.1 The Subscriber acknowledges that any resale of the Securities will be
subject to resale restrictions contained in the securities legislation
applicable to the Subscriber or proposed transferee. The Subscriber acknowledges
that none of the Securities have been registered under the 1933 Act or the
securities laws of any state of the United States. None of the Securities may be
offered or sold in the United States unless registered in accordance with
federal securities laws and all applicable state securities laws or exemptions
from such registration requirements are available.
9. Legending and Registration of Subject SECURITIES
9.1 The Subscriber hereby acknowledges that upon the issuance thereof, and until
such time as the same is no longer required under the applicable securities laws
and regulations, the certificates representing the Shares will bear a legend in
substantially the following form:
THE SECURITIES REPRESENTED HEREBY HAVE BEEN OFFERED IN AN
OFFSHORE TRANSACTION TO A PERSON WHO IS NOT A U.S. PERSON (AS
DEFINED HEREIN) PURSUANT TO REGULATION S UNDER THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT").
NONE OF THE SECURITIES REPRESENTED HEREBY HAVE BEEN REGISTERED
UNDER THE 1933 ACT, OR ANY U.S. STATE SECURITIES LAWS, AND,
UNLESS SO REGISTERED, MAY NOT BE OFFERED OR SOLD, DIRECTLY OR
INDIRECTLY, IN THE UNITED STATES (AS DEFINED HEREIN) OR TO U.S.
PERSONS EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF REGULATION S
UNDER THE 1933 ACT, PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE 1933 ACT, OR PURSUANT TO AN AVAILABLE
EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE 1933 ACT AND IN EACH CASE ONLY
IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS. IN ADDITION,
HEDGING TRANSACTIONS INVOLVING THE SECURITIES MAY NOT BE
CONDUCTED UNLESS IN COMPLIANCE WITH THE 1933 ACT. "UNITED STATES"
AND "U.S. PERSON" ARE AS DEFINED BY REGULATION S UNDER THE 1933
ACT.
9.2 The Subscriber hereby acknowledges and agrees to the Company making a
notation on its records or giving instructions to the registrar and transfer
agent of the Company in order to implement the restrictions on transfer set
forth and described in this Subscription Agreement.
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10. Collection of Personal Information
10.1 The Subscriber acknowledges and consents to the fact that the Company is
collecting the Subscriber's personal information for the purpose of fulfilling
this Subscription Agreement and completing the Offering. The Subscriber's
personal information (and, if applicable, the personal information of those on
whose behalf the Subscriber is contracting hereunder) may be disclosed by the
Company to (a) stock exchanges or securities regulatory authorities, (b) the
Company's registrar and transfer agent, and (c) any of the other parties
involved in the Offering, including legal counsel, and may be included in record
books in connection with the Offering. By executing this Subscription Agreement,
the Subscriber is deemed to be consenting to the foregoing collection, use and
disclosure of the Subscriber's personal information (and, if applicable, the
personal information of those on whose behalf the Subscriber is contracting
hereunder) and to the retention of such personal information for as long as
permitted or required by law or business practice. Notwithstanding that the
Subscriber may be purchasing Shares as agent on behalf of an undisclosed
principal, the Subscriber agrees to provide, on request, particulars as to the
identity of such undisclosed principal as may be required by the Company in
order to comply with the foregoing.
11. Costs
11.1 The Subscriber acknowledges and agrees that all costs and expenses incurred
by the Subscriber (including any fees and disbursements of any special counsel
retained by the Subscriber) relating to the purchase of the Shares shall be
borne by the Subscriber.
12. Governing Law
12.1 This Subscription Agreement is governed by the laws of the State of Nevada.
The Subscriber, in its personal or corporate capacity and, if applicable, on
behalf of each beneficial purchaser for whom it is acting, irrevocably attorns
to the exclusive jurisdiction of the Courts of the State of Nevada.
13. Survival
13.1 This Subscription Agreement, including without limitation the
representations, warranties and covenants contained herein, shall survive and
continue in full force and effect and be binding upon the parties hereto
notwithstanding the completion of the purchase of the Shares by the Subscriber
pursuant hereto.
14. Assignment
14.1 This Subscription Agreement is not transferable or assignable.
15. Severability
15.1 The invalidity or unenforceability of any particular provision of this
Subscription Agreement shall not affect or limit the validity or enforceability
of the remaining provisions of this Subscription Agreement.
16. Entire Agreement
16.1 Except as expressly provided in this Subscription Agreement and in the
agreements, instruments and other documents contemplated or provided for herein,
this Subscription Agreement contains the entire agreement between the parties
with respect to the sale of the Shares and there are no other terms, conditions,
representations or warranties, whether expressed, implied, oral or written, by
statute or common law, by the Company or by anyone else.
17. Notices
17.1 All notices and other communications hereunder shall be in writing and
shall be deemed to have been duly given if mailed or transmitted by any standard
form of telecommunication. Notices to the Subscriber shall be directed to the
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address on page 2 and notices to the Company shall be directed to it at the
first page of this Subscription Agreement.
18. Counterparts and Electronic Means
18.1 This Subscription Agreement may be executed in any number of counterparts,
each of which, when so executed and delivered, shall constitute an original and
all of which together shall constitute one instrument. Delivery of an executed
copy of this Subscription Agreement by electronic facsimile transmission or
other means of electronic communication capable of producing a printed copy will
be deemed to be execution and delivery of this Subscription Agreement as of the
date hereinafter set forth.
