STOCK PURCHASE AGREEMENT
THIS AGREEMENT (the "Agreement") by and between Tasty Fries, Inc., a
Nevada corporation, located at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, (hereinafter referred to as "Seller") and ▇▇▇▇▇▇▇▇▇ Ventures
Corporation, Inc., a Pennsylvania corporation, located at ▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (hereinafter referred to as
"Buyer") this 30 day of April, 1996.
A. SECURITIES TO BE PURCHASED: An aggregate of 25,000,000 shares of
the Company's restricted common
stock, $.01 par value (the
"Common Stock").
B. PURCHASE PRICE: $1,250,000.00 ($.05 per share)
C. FIRST CLOSING DATE: April 30, 1996
W I T N E S S E T H
WHEREAS, the Seller desires to sell and the Buyer desires to purchase
25,000,000 shares of restricted Common Stock of Seller (the "Stock") on the
terms and conditions set forth herein.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, and for the mutual covenants,
representations, warranties and conditions hereinafter set forth, the parties
agree as follows:
1. SECURITIES TO BE PURCHASED
A. NUMBER OF SHARES. Buyer shall purchase from Seller
Twenty Five Million (25,000,000) shares of restricted Common Stock (the "Stock")
of Tasty Fries, Inc., a Nevada corporation (hereinafter referred to as the
"Seller" or the "Company").
B. RESTRICTION; SUBSEQUENT REGISTRATION; LOCK-UP. Buyer agrees
that the Stock issued by Seller will be restricted as to transferability under
the Securities Act of 1933, as amended (the "Securities Act"). Seller agrees to
register the Stock by filing an appropriate registration statement (the
"Registration Statement") with the U.S. Securities and Exchange Commission (the
"SEC") within sixty (60) days from the date of purchase of all 25,000,000 shares
of Stock. In connection with the registration of the Stock, Buyer hereby agrees
not to sell such Stock for a period of sixty (60) days from the date the
Registration Statement is declared effective by the SEC (the "Lock-Up").
2. PURCHASE PRICE
The total purchase price of the Stock is One Million Two Hundred
Fifty Thousand Dollars ($1,250,000.00) in United States currency payable by
Buyer in two installments of Five Hundred Thousand Dollars ($500,000) at the
First Closing (as defined below) and Seven Hundred Fifty Thousand Dollars
($750,000) at the Second Closing (as defined below), each in the form of a
certified bank check or wire transfer into the Seller's bank account.
3. PAYMENT
A. On the date of the First Closing of this Agreement (the "First
Closing"), Buyer shall pay Seller the first installment of Five Hundred Thousand
Dollars ($500,000.00), as set forth in Paragraph 2 herein.
B. The balance of Seven Hundred Fifty Thousand Dollars
($750,000.00) shall be paid in a second installment, as set forth in Paragraph
2, on or before thirty (30) days from the date of First Closing (the "Second
Closing").
4. FIRST AND SECOND CLOSING
A. LOCATION. The First Closing shall take place at the
Seller's executive offices, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ at 11:00 a.m. or at such other time and place as shall be
mutually agreeable to the parties. The Second Closing shall occur at such time
and place and in such manner as Seller and Buyer may mutually agree.
B. DELIVERY OF STOCK CERTIFICATES
(i) At the First Closing, Seller shall deliver to Buyer,
free and clear of all encumbrances except for the Securities Act restrictive
legend as described in Paragraph 1.B. herein, certificate(s) for the Stock (as
set forth in Paragraph 1) in the aggregate amount of 10,000,000 shares of Stock
and a corporate resolution authorizing the sale and transfer of such 10,000,000
shares of Stock to Buyer upon receipt of the first installment of the Purchase
Price from Buyer in accordance with Paragraphs 2 and 3.A. herein.
(ii) Upon the Second Closing, Seller shall deliver to
Buyer, free and clear of all encumbrances except for the Securities Act
restrictive legend as described in Paragraph 1.B. herein, certificate(s) for the
Stock (as set forth in Paragraph 1) in the amount of 15,000,000 shares of Stock
and a corporate resolution authorizing the sale and transfer of such 15,000,000
shares of Stock upon receipt of the second installment of the Purchase Price
from Buyer in accordance with Paragraphs 2 and 3.A. herein.
C. SIMULTANEOUS TRANSACTIONS. All transactions at the First
Closing and at the Second Closing shall be considered to take place
simultaneously. No delivery shall be considered to be made until all
transactions are consummated in accordance with this Agreement.
5. DELIVERY AT FIRST AND SECOND CLOSING
A. The documents set forth below shall be delivered by
Seller to Buyer:
(i) Stock certificate(s) for an aggregate of 10,000,000
shares of Stock at the First Closing and 15,000,000 shares of Stock at the
Second Closing as required by Paragraph 4.B. herein.
(ii) A corporate resolution at each of the First and
Second Closing as required by Paragraph 4.B. herein.
B. The Buyer shall deliver to Seller:
(i) A bank check or written evidence of wire transfer,
which such wire shall have actually been received by Seller, in the aggregate
amount of $500,000.00 at the First Closing and in the aggregate amount of
$750,000.00 at the Second Closing.
C. Fully executed copies of this Agreement and the
Subscription Agreement attached hereto and made a part hereof shall be delivered
to each of the Seller and Buyer at the First Closing.
6. REPRESENTATIONS AND WARRANTIES OF SELLER
A. Seller hereby represents and warrants as follows:
(a) ORGANIZATION; RIGHT TO SELL. Seller is a
corporation duly incorporated and validly existing in the State of Nevada and
its status is active. Seller has all necessary capacity and authority to execute
this Agreement, to sell the Stock to Buyer and to carry out its obligations
hereunder. The undersigned, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, President of the Company, is an
authorized agent of the Company empowered by the Board of Directors of the
Company to enter into and bind the Seller to the terms and conditions of this
Agreement. The execution and delivery of this Agreement and the consummation of
the transactions contemplated hereunder have been duly authorized by all
necessary action on the part of Seller.
(b) STOCK OWNERSHIP. Seller is the sole beneficial
owner of the Stock, all of which is free and clear of any liens or encumbrances
except being subject to the rules and regulations relating to transferability
under the Securities Act.
(c) ENFORCEABILITY OF OBLIGATIONS. This Agreement
and the other agreements contemplated hereunder constitute valid and binding
obligations of Seller enforceable against it in accordance with the terms hereof
and thereof.
(d) COMPLIANCE WITH LAWS AND AGREEMENTS. The Seller,
to its knowledge, has complied with all applicable federal and state laws, rules
and regulations. Seller is not prevented by any provisions of any articles,
bylaws, contracts, mortgages, indenture or other instrument from selling the
Stock as contemplated herein.
(e) CONTRACTS TO SELL STOCK. Seller has not entered
into any other contract to sell all or any part of the Stock as represented
herein.
(f) POWER OF ATTORNEY. There is no Power of Attorney
outstanding with respect to the Stock.
(g) COOPERATION OF SELLER. Seller agrees and
represents that it will fully cooperate with Buyer in providing, executing and
delivering any other documentation necessary to complete the transactions
contemplated by this Agreement.
7. REPRESENTATIONS AND WARRANTIES OF BUYER
A. Buyer hereby represents and warrants as follows:
(a) ORGANIZATION; RIGHT TO PURCHASE. In executing
this Agreement to purchase the Stock, Buyer has (and all persons acting on
Buyer's behalf) have the requisite power and authority to execute and deliver
this Agreement and is acting solely for itself and its investors and for no
other person, firm, partnership, corporation, or entity and that no person, firm
or corporation (including, without limitation, Buyer), is or may be entitled to
a broker's fee, or similar payment from any party hereto, any of Buyer's
investors or any other person, firm or corporation for arranging the
transactions contemplated herein.
(b) INVESTMENT INTENT. Buyer is acquiring the
Stock for the benefit of its own investors and not with any view to its
distribution or transfer to any other person(s), firm, partnership, corporation
or entity.
(c) FINANCIAL CAPABILITY. Buyer's assets, net
worth and financial resources generally are sufficient to permit Buyer to
purchase the Stock in accordance with the terms and conditions of this Agreement
and is able to bear the economic and other substantial risks associated with its
purchase of the Stock including the risk of a total loss of its investment
therein; that it has no need for liquidity in this investment; that its overall
commitment to investments that are not readily marketable or not
disproportionate to its net worth; that its investment in the Stock will not
cause such overall commitment to become excessive; and that when received from
Seller, the Stock will be "restricted" (as such term is defined within Rule 144
of the Securities Act).
(d) NO CONFLICTS. Buyer has no interest, direct or
indirect, that would conflict with the business of the Company.
(e) COMPLIANCE WITH LAW AND AGREEMENTS. Buyer is
not prevented by any federal or state laws, rules and regulations or by any
provisions of any articles, by laws, contract, mortgage, indenture or other
instrument from purchasing the Stock as contemplated herein.
(f) EVALUATION OF INVESTMENT. Buyer and its
investors have such knowledge and experience in financial and business matters
generally, and with respect to the business and other activities of the Company
and are capable of evaluating the merits and risks of the investment in the
Stock, and Buyer has instituted this transaction and has satisfied itself of the
financial and business condition of the Company and is not making this purchase
of Stock based upon any representations of Seller other than the representations
contained in Paragraph 6 herein. In connection with the financial and business
condition of the Company as of the date hereof, Seller has provided Buyer with
and Buyer acknowledges receipt of all information relating to the materially
adverse condition of the Company, including but not limited to, (i) the pendency
of a writ of execution to be executed against the Company and substantially all
of its assets pursuant to an order of the Federal District Court for the Central
District of California in satisfaction of a judgment against the Company in
favor of California Food & Vending, Inc. ("CFV") in the approximate amount of
$440,000, (ii) the outstanding monetary judgment in favor of ▇▇▇▇▇▇ ▇▇▇▇▇ of
approximately $10,000 pursuant to which a writ of execution against the
Company's assets is pending, (iii) the total lack of capital to pay any employee
of the Company past due but accrued wages for approximately nine weeks, (iv)
unpaid rent and utilities for the Company's executive offices for two months;
(v) unpaid trade debt and other financial obligations; and (vi) payment to
Premier Design Ltd. for its share of development costs for the Company's
proprietary french fry vending machine.
8. APPOINTMENT OF BOARD MEMBER
Seller agrees to appoint an individual selected by Buyer to serve
as a member of the Board of Directors of the Company, which individual shall
serve in such capacity until the next annual (or special in lieu of annual)
meeting of shareholders at which directors are elected and qualified.
9. REVERSE SPLIT OF COMMON STOCK
Seller agrees that upon completion of all of the transactions
contemplated by this Agreement, Seller shall, by and through its Board of
Directors, pass a resolution to reverse split (the "Reverse Split")
its currently issued and outstanding Common Stock, including the Stock, on a one
for twenty basis or at such other ratio as is approved by the Board of
Directors. The result of such Reverse Split shall be that the total issued and
outstanding number of shares of Common Stock of the Company, including the
Stock, shall be no greater than six million (6,000,000) shares. Thereafter, the
Board of Directors shall seek to obtain the vote of its shareholders to approve
and ratify the Reverse Split as required by applicable law.
10. ISSUANCE OF ADDITIONAL SHARES
A. It is further agreed by Seller that, as a condition for Buyer
to purchase the Stock and to help to assure the success and development of the
Company and its products, Seller shall issue, after the Reverse Split is
effected, one million five hundred thousand (1,500,000) shares of post-Reverse
Split Common Stock to ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, President of the Company ("▇▇▇▇▇"), for
past, present and future services rendered to the Company (the "▇▇▇▇▇ Shares"),
which ▇▇▇▇▇ Shares shall be issued as consideration for such services, exclusive
of any salary, bonus or other compensation in any form received or to be
received by ▇▇▇▇▇.
B. After the First Closing, the Second Closing and the Reverse
Split, the Company shall issue an additional 250,000 shares of post-Reverse
Split Common Stock to Buyer (the "Additional Stock").
C. In addition to the Shares and the issuance of the Additional
Stock, it is further agreed by Buyer that, upon the effective date of the
Reverse Split, Buyer shall purchase that number of shares of Reverse Split
Common Stock as shall be equal to $1,000,000 at a purchase price determined at
65% of the average of the bid and asked price of the Common Stock on the
effective date of the Reverse Split.
D. It is understood and agreed by Buyer, Seller and ▇▇▇▇▇ that
the Additional Stock and the ▇▇▇▇▇ Shares will be restricted in accordance with
the Rule 144 of the Securities Act. Such Additional Stock and ▇▇▇▇▇ Shares shall
also be included in the Registration Statement to be filed with the SEC in
accordance with Paragraph 1.B.herein. It is further understood, and agreed to by
Buyer and ▇▇▇▇▇ that such Additional Stock and ▇▇▇▇▇ Shares shall be subject to
the same 60 day Lock-Up period as the Stock as set forth in Paragraph 1.B.
herein.
11. ISSUANCE OF POST-REVERSE SPLIT WARRANTS
Seller agrees to issue to each of Buyer and ▇▇▇▇▇ warrants (the
"Anti-Dilution Warrants") to purchase THE LESSER OF (i) 5,000,000 shares of
restricted Common Stock or (ii) such amount of shares of Common Stock which will
insure, in either event, that each of Buyer and ▇▇▇▇▇ shall maintain ownership
of no less than twenty-five percent (25%) of the issued and outstanding Common
Stock of the Company at any time, exercisable for a period of three (3) years
commencing May 29, 1996 and ending May 29,
1999 at an exercise price per share equal to the average of the bid and asked
price per share on the effective date of the Reverse Split. Such Anti-Dilution
Warrants shall provide for usual and customary anti-dilution rights for each of
Buyer and ▇▇▇▇▇ to maintain their respective 25% ownership interest in the
Company's issued and outstanding Reverse Split Common Stock upon exercise
thereof.
THESE WARRANTS WILL BE REGISTERED. /S/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------
/S/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
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4/30/96
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12. INDEMNIFICATION.
A. INDEMNIFICATION OF SELLER BY BUYER. Buyer shall indemnify and
hold harmless Seller and its agents, officers, directors, employees, attorneys,
accountants and shareholders from and against any and all damages, claims,
liabilities, losses, costs and expenses whatsoever, including, without
limitation, reasonable attorneys' fees incurred by Seller or asserted against
Seller as a result of or arising out of (i) any material breach of a
representation or warranty, or misrepresentation by or on behalf of Buyer under
this Agreement, or the material breach or material nonperformance of any
covenant, agreement or obligation to be performed by Buyer; (ii) any material
misrepresentation in, or material omission from, any certificate or instrument
executed and delivered or to be executed and delivered by or on behalf of Buyer
in connection with this Agreement which cannot be corrected promptly without
having a material adverse effect on Seller; (iii) any material claim, judgment,
action or proceeding asserted against Seller with respect to any obligations or
liabilities of Buyer of any type whatsoever, whether now existing or hereafter
arising or acquired, whether contingent or liquidated, direct or indirect,
occurring on or prior to or existing on the date hereof, including, without
limitation, any obligations or liabilities of Buyer pertaining to claims
asserted against Buyer by reason of the failure of Buyer to satisfy any
obligations.
B. INDEMNIFICATION OF BUYER BY SELLER. Seller shall indemnify and
hold harmless Buyer from and against any and all damages, claims, liabilities,
losses, costs and expenses whatsoever including, without limitation, reasonable
attorneys' fees incurred by Buyer or asserted against Buyer as a result of or
arising out of (i) any material breach of a representation or warranty, or
misrepresentation by or on behalf of Seller under this Agreement, or the
material breach or material non-performance of any covenant or obligation to be
performed by Seller pursuant to this Agreement; or (ii) any material
misrepresentation in, or material omission from any certificate or instrument
executed and delivered or to be executed and delivered by or on behalf of Seller
pursuant to this Agreement which cannot be corrected promptly without having a
material adverse effect on Buyer.
13. GENERAL.
A. EXPENSES. All costs and expenses (including, without
limitation, the fees and disbursements of legal counsel) incurred in connection
with this Agreement and the transactions contemplated hereby shall be paid by
the party incurring such expenses.
B. ENTIRE AGREEMENT. This Agreement, together with the
agreements and other documents to be delivered pursuant hereto, constitute the
entire agreement between the parties pertaining to the subject matter hereof and
supersede all prior agreements, understandings, negotiations and discussions,
whether oral or written, of the parties and there are no warranties,
representations or other agreements between the parties in connection with the
subject matter hereof except as specifically set forth herein. No supplement,
modification or waiver or termination of this Agreement shall be deemed or shall
constitute a waiver of any other provision (whether or not similar) nor shall
such waiver constitute a continuing waiver unless otherwise expressly provided.
C. APPLICABLE LAW. This Agreement shall be governed by,
construed and enforced in accordance with the laws of the State of Pennsylvania,
without giving effect to principles of conflict of laws. The parties hereto
expressly submit themselves to, and agree that all actions arising out of this
Agreement shall occur solely in the venue and jurisdiction of the state and
federal courts encompassing ▇▇▇▇▇▇▇▇▇▇ County, Pennsylvania.
D. SEVERABILITY. If any provision of this Agreement shall
be held or deemed to be, or shall in fact be, invalid, inoperative or
unenforceable as applied to any particular case in any jurisdiction or
jurisdictions, or in all jurisdictions or in all cases, because of the conflict
of any provision with any constitution or statute or rule of public policy or
for any other reason, such circumstance shall not have the effect of rendering
the provision or provisions in question invalid, inoperative or unenforceable in
any other jurisdiction or in any other case or circumstance or of rendering any
other provision or provisions herein invalid, inoperative or unenforceable to
the extent that any such other provisions themselves actually conflict with such
constitution, statute or rule of public policy, but this Agreement shall be
reformed and construed in any such jurisdiction or case as if such invalid,
inoperative or unenforceable provision had never been contained herein and such
provision reformed so that it would be valid, operative and enforceable to the
maximum extent permitted in such jurisdiction or in such case.
E. ACTIONS TO ENFORCE AGREEMENT. If any party hereto
shall fail to perform any covenant or condition hereof or shall otherwise be in
breach of this Agreement, such party shall pay to the non-defaulting party or
parties its/their reasonable attorneys' fees and costs incurred as a result of
its/their efforts to enforce this Agreement (whether or not litigation is
commenced, at trial and appellate levels).
F. RULE OF CONSTRUCTION THAT AMBIGUITIES ARE TO BE CONSTRUED
AGAINST THE DRAFTER NOT APPLICABLE. The parties to this Agreement acknowledge
that they have each carefully read and reviewed this Agreement with their
respective counsel, and therefore agree that the rule of construction that
ambiguities shall be construed against the drafter of the document shall not be
applicable.
G. NOTICES. Any and all notices required to be given
hereunder or other communications to or from the parties hereto shall be in
writing and be sent by hand-delivery, by nationally recognized overnight
delivery service or by certified mail, postage prepaid, return receipt
requested, to the parties as follows:
If to Buyer: ▇▇▇▇▇▇▇▇▇ Ventures Corporation, Inc.
▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇, President
with a copy to: ________________________
________________________
________________________
________________________
If to Seller: Tasty Fries, Inc.
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, President
with a copy to: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, Esq.
or such other address as the parties may direct by notice given in accordance
herewith. All notices shall be deemed given on the date received or the date
noted on the return receipt or delivery receipt as the date when delivery was
refused.
H. ASSIGNMENT. This Agreement may not be assigned by any
party hereto without the express written consent of the other parties.
I. FURTHER ASSURANCES. The parties hereto, with
reasonable diligence, shall do all such things and provide all such reasonable
assurances as may be required to consummate the transactions contemplated
hereby, and each party hereto shall provide such further documents or
instruments required by any other party hereto as may be reasonably necessary or
desirable to effect the purpose of this Agreement and to carry out its
provisions, whether before or after the First Closing and the Second Closing.
J. REMEDIES. Nothing contained in this Agreement is
intended to or shall be construed to limit the remedies which any party hereto
may have against the other parties hereto in the event of a
default by such party with respect to their obligations hereunder or in the
event of a breach by such party of any representation, warranty or agreement
made in or pursuant to this Agreement, it being intended that any and all
remedies shall be cumulative and non-exclusive.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
which is effective as of April 30, 1996.
TASTY FRIES, INC.
________________________ By: /S/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Witness -------------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇, President
▇▇▇▇▇▇▇▇▇ VENTURES CORPORATION, INC.
________________________ By: /S/ L. ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Witness -------------------------------------------
▇▇▇▇ ▇▇▇▇▇▇▇▇▇, President
AS TO PARAGRAPHS 10 AND 11:
________________________ /S/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Witness -------------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Individually
SUBSCRIPTION AGREEMENT
Tasty Fries, Inc.
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Gentlemen:
The undersigned is writing to advise you of the following terms and
conditions under which the undersigned hereby offers to subscribe (the "Offer")
to an aggregate of 25,000,000 shares plus additional shares as set forth below
in 1.(A) of the restricted common stock (the "Common Stock" or the "Shares") of
Tasty Fries, Inc. (the "Company").
1. SUBSCRIPTION.
(A) Subject to the terms and conditions hereinafter set forth in
this Subscription Agreement, the undersigned hereby offers to purchase (i) an
aggregate of 25,000,000 Shares for an aggregate purchase price of $1,250,000
payable in two installments, the first of which is $500,000.00 for 10,000,000
Shares and the second is $750,000.00 for 15,000,000 Shares, to be paid by bank
check or wire transfer to the Company's account on each of the First and Second
Closing, respectively, as defined and described in that certain Stock Purchase
Agreement dated April 30, 1996 (the "Stock Purchase Agreement"), of which this
Subscription Agreement forms a part, and (ii) an additional purchase for
$1,000,000 of that number of Shares which, after the Reverse Split (as defined
in the Stock Purchase Agreement), shall be determined by multiplying the
$1,000,000 purchase price by 65% of the average bid and asked price of the
Common Stock of the Company on the effective date of the Reverse Split approved
by a majority of the Company's shares of common stock then outstanding.
2. CONDITIONS TO OFFER.
The offering is made subject to the following conditions:
(A) The undersigned is an accredited investor as defined in the
rules promulgated under the Securities Act of 1933, as amended (the "Act").
(B) That the undersigned agrees to comply with the terms of this
Subscription Agreement and to execute and deliver any and all further documents
necessary to become a Common Stock shareholder in the Company.
Acceptance of this Offer shall be deemed given by the
countersigning of this Subscription Agreement on behalf of the Company.
3. REPRESENTATIONS AND WARRANTIES OF THE UNDERSIGNED.
The undersigned, in order to induce the Company to accept this
Offer, hereby warrants and represents as follows:
(A) The information provided by the undersigned is true and
correct.
(B) The undersigned is over the age of 21 years and
resides at the address set forth below.
(C) The undersigned has sufficient liquid assets to sustain a
loss of the undersigned's entire investment.
(D) The undersigned has such knowledge and experience in
financial, investment and business matters that he is capable of evaluating the
merits and risks of the prospective investment in the Shares being offered on
the terms and conditions set forth herein. The undersigned has consulted with
such independent legal counsel or other advisers considered appropriate to
assist the undersigned in evaluating his proposed investment in the Company. In
particular, and not in limitation of the foregoing, the undersigned has taken
full cognizance of and understands:
(i) the nature and business of the Company and has had
access to information with respect to the Company, inclusive of its (a) Form
10-KSB for the fiscal year ended January 31, 1995; (b) Form 10-QSB for the
fiscal quarters ended April 30, 1995, July 31, 1995 and September 30, 1995 (c)
Form 8-K dated February 27, 1995 and February 25, 1996, and to such other
information as has been requested by the undersigned including information
relating to the Company's severe financial condition as of the date hereof;
(ii) that there are substantial risk factors to be
considered in connection with an investment in the Company, including but not
limited to all risks disclosed in the documents described in 3(D)(i) herein;
(iii) that the Shares are a speculative investment which
involve a high degree of risk of loss of an investor's entire investment in the
Company; and
(iv) that there are substantial restrictions on the
transferability of the Shares and the Shares are not registered under the Act;
while there is presently a public market for the Company's Common Stock, no
assurances are given that a public market will be maintained in the future;
accordingly, the undersigned may have to hold the Shares indefinitely and it may
not be possible for an investor to liquidate his investment in the Company.
(E) The undersigned represents that it:
(i) has adequate means of providing for its current
financial needs and possible personal contingencies, and has no need for
liquidity of investment in the Company;
(ii) can afford (a) to hold unregistered securities for
an indefinite period of time and (b) sustain a complete loss of the entire
amount of the subscription;
(iii) has not made an overall commitment to investments
which are not readily marketable which is disproportionate so as to cause such
overall commitment to become excessive; and
(iv) confirms that there has been no material adverse
change in the informa-tion, financial and other, previously given to the
Company in order to induce the Company to send this form of Subscription
Agreement to the undersigned.
(F) The undersigned has:
(i) been furnished with such information in connection
with this transaction as has been requested, including the documentation listed
in 3(D)(i) above; and
(ii) been afforded the opportunity to ask questions of,
and receive answers from the officers and/or directors of the Company acting on
its behalf concerning the terms and conditions of the transaction that is the
subject of this offer and to obtain any additional information, to the extent
that the Company possesses such information or can acquire it without
unreasonable effort or expense, necessary to verify the accuracy of the
information furnished; and has availed itself of such opportunity to the extent
it considers appropriate in order to permit it to evaluate the merits and risks
of an investment in the Company.
It is understood that all documents, records and books
pertaining to this investment have been made available for inspection by the
undersigned's attorney and/or advisors and the undersigned, and that the books
and records of the Company will be available upon reasonable notice for
inspection by investors during reasonable business hours at its principal place
of business.
(G) The undersigned acknowledges that the Shares being subscribed
for hereunder have not been registered under the Act in reliance on an exemption
for private offerings, that the Company has agreed to register the Shares in
accordance with the terms and conditions of the Stock Purchase Agreement, and
further understands that it is purchasing the Shares without being furnished any
offering literature or prospectus except as provided in 3(D)(i) hereof.
(H) The undersigned further acknowledges that this offering has
not been passed upon or the merits thereof endorsed or approved by any state or
federal authorities.
(I) The Shares being subscribed for are being acquired solely for
the account of the undersigned for investment and not with a view to, or for
resale in connection with, any illegal distribution. By such representation, the
undersigned means that no other person has a beneficial interest in the Shares
subscribed for hereunder, and that no other person has furnished or will furnish
directly or indirectly, any part of or guarantee the payment of any part of the
consideration to be paid to the Company in connection therewith.
The undersigned certifies that each of the foregoing
representations and warranties set forth in subsections (A) through (I)
inclusive of this Section 3 are true as of the date hereof and shall survive
such date.
4. RIGHT OF WITHDRAWAL FOR PENNSYLVANIA INVESTORS.
SECTION 207(M). "EACH PERSON WHO ACCEPTS AN OFFER TO PURCHASE
SECURITIES EXEMPTED FROM REGISTRATION BY SECTION 203(D), DIRECTLY FROM THE
ISSUER OR AFFILIATE OF THE ISSUER, SHALL HAVE THE RIGHT TO WITHDRAW HIS
ACCEPTANCE WITHOUT INCURRING ANY LIABILITY TO THE SELLER, UNDERWRITER (IF ANY)
OR ANY OTHER PERSON WITHIN 2 BUSINESS DAYS FROM THE DATE OF RECEIPT BY THE
ISSUER OF HIS WRITTEN BINDING CONTRACT OF PURCHASE, OR, IN THE CASE OF A
TRANSACTION IN WHICH THERE IS NO BINDING CONTRACT OF PURCHASE, WITHIN 2 BUSINESS
DAYS AFTER HE MAKES THE INITIAL PAYMENT FOR THE SECURITIES BEING OFFERED."
5. AGREEMENT OF PENNSYLVANIA INVESTORS NOT TO SELL.
The undersigned Pennsylvania investor hereby acknowledges and
agrees that as a condition of the availability of the exemption in Section
203(d) of the Act, he/she/it will not sell the securities purchased hereby
within 12 months after the date of purchase, except in accordance with
Regulation 204.001.
6. NO WAIVER.
Notwithstanding any of the representations, warranties,
acknowledgements or agreements made herein by the undersigned, the undersigned
does not thereby or in any manner waive any rights granted to the undersigned
under federal or state securities laws.
7. MISCELLANEOUS.
(A) All notices or other communications given or made hereunder
shall be in writing and shall be mailed by registered or certified mail, return
receipt requested, postage prepaid, to the undersigned at his address set forth
below and to the Company at Tasty Fries, Inc., ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇,
▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇ Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, President.
(B) This Subscription Agreement together with all exhibits and
amendments thereto 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.
(C) The provisions of this Subscription Agreement shall survive
the closing hereunder.
8. CERTIFICATION.
The undersigned certifies that it has read this entire
Subscription Agreement and that every statement on its part made and set forth
herein is true and complete.
IN WITNESS WHEREOF, the undersigned has executed this Subscription
Agreement on the date his signature has been subscribed and sworn to below.
▇▇▇▇▇▇▇▇▇ VENTURES CORP., INC.
The Shares ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
are to be -------------------------------------------
issued in Print Name of Investor(s)
(check ONE box):
/S/ L. ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
-------------------------------------------
____ individual name Signature of Investor
____ joint tenants -------------------------------------------
with rights of Signature of Investor
survivorship
____ tenants in the Address:
entirety
_X__ corporation ▇▇-▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ DR.
(an officer -------------------------------------------
must sign) Number and Street
LANCASTER
-------------------------------------------
City
____ partnership
(all general PA. 17602
partners must sign) -------------------------------------------
State Zip
Accepted as of the 30 day
of April, 1996
Tasty Fries, Inc.,
a Nevada corporation
By: /S/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
---------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇, President
