SUBSCRIPTION AGREEMENT
Xx. Xxxxxxx X. XxXxxx
Televar Northwest, Inc.
000 Xxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Re: Offering of Common Stock
Dear Charlie:
In connection with the offer and proposed issuance (the "Offering") by
Televar Northwest, Inc., a Washington corporation (the "Company"), of up to
30,000 shares of Common Stock ("Shares") at $1.00 per share, the
undersigned prospective investor (the "Investor") and the Company hereby
agree as follows:
1. Subscription. The Investor hereby subscribes for and agrees to
purchase the number of Shares set forth on the signature page of this
Subscription Agreement (the "Agreement") at a price of $1.00 per Share,
subject to the following conditions and understandings:
a. Acceptance or Rejection. The Company, in its sole discretion
and for any reason, may accept or reject this subscription, in whole or in
part.
b. Closing. The closing of the transaction contemplated by this
Agreement is expected to take place within three (3) business days of the
date of this Agreement ("Closing"). On or before the Closing the Investor
will deliver to the Company a certified or cashier's or bank check for the
total price of the Shares subscribed for. At Closing the Company will
deliver to the Investor the certificate(s) representing the Shares in the
name of the Investor.
2. Representations and Warranties. The Investor makes the
acknowledgments, representations and warranties set forth in this Section 2
with the intent that they will be relied upon in determining the Investor's
suitability as a purchaser of Shares. If the Investor includes or consists
of more than one person or entity, the obligations of the Investor shall be
joint and several and the acknowledgments, representations and warranties
herein shall be deemed to be made by and be binding upon each such person
or entity and the respective heirs, executors, administrators, successors
and assigns.
a. No Regulatory Review. The Investor acknowledges and
understands that this is a limited offering being made solely to the
Investor and that no federal, state or other agency has made any finding or
determination as to the fairness of the investment nor made any
recommendation or endorsement of the Shares.
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b. Ability to Evaluate. The Investor, by reason of the Investor's
knowledge and experience in financial and business matters is capable of
evaluating the risks and merits of an investment in the Shares. The
Investor recognizes that the Shares are speculative and that investment in
the Shares involves a high degree of risk. The Investor is prepared to bear
the economic risk of an investment in the Shares and is able to withstand a
total loss of the Investor's investment in the Shares.
c. Investment Intent. The Investor acknowledges that the purchase
of Shares hereunder is being made for the Investor's own account, for
investment purposes only and not with the present intention of distributing
or reselling the Shares in whole or in part. The Investor further
understands that the Shares have not been registered under the Securities
Act of 1933, as amended (the "Act"), or under any state securities laws by
reason of specific exemptions therefrom, which depend upon, among other
things, the accuracy of the Investor's representations as expressed in this
Agreement. The Investor acknowledges that transfer of the Shares is
restricted under the Act and under applicable state securities laws. The
Investor further acknowledges that it is his or her responsibility to
consult with his or her counsel regarding the restrictions on resale of the
Shares prior to any resale thereof. Notwithstanding the foregoing, in the
event the Company registers all or any part of its common capital stock for
sale to the general public, the Investor shall have piggyback registration
rights with respect to a portion of the Shares. In particular, the Company
shall register 50% of the Shares purchased hereunder, which Shares shall
thereafter be freely tradable upon the effective date of the Registration
Statement filed with the Securities and Exchange Commission. The balance of
the Shares shall be subject to restrictions upon sale in accordance with
state and federal securities laws.
d. Investment Information. The Investor has received and read the
disclosure materials dated April 1996, consisting of the Business Plan and
Financial Statements (collectively, the "Memorandum"), prior to the
execution of this Agreement. The Investor will rely solely upon the
Memorandum and independent investigations made by the Investor in making a
decision to purchase the Shares. In particular, and without limiting the
generality of the foregoing, the Investor has not relied on, and the
Investor's decision to subscribe for Shares has not been influenced by: (i)
newspaper, magazine or other media articles or reports related to the
Company or its business; (ii) promotional literature or other materials
used by the Company for sales or marketing purposes; or (iii) any other
written or oral statement of the Company or persons purporting to represent
the Company, except the Memorandum or oral statements of management of the
Company furnished or communicated to the Investor in connection with the
Offering. The Investor has had the opportunity to discuss all aspects of
this transaction with management of the Company, has made or has had the
opportunity to make such inspection of the books and records of the Company
as the Investor has deemed necessary in connection with this investment,
and any questions asked have been answered to the satisfaction of the
Investor; however, no written representations apart from the Memorandum
have been made to the Investor.
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e. Confidentiality. The Investor understands that the Memorandum
is confidential. The Investor has not distributed the Memorandum, or
divulged the contents thereof, to anyone other than such legal or financial
advisors as the Investor has deemed necessary for purposes of evaluating an
investment in the Shares and no one (except such advisors) has used the
Memorandum, and the Investor has not made any copies thereof.
f. Authorization and Formation of Subscriber. The Investor, if a
corporation, partnership, trust or other form of business entity, is
authorized and otherwise duly qualified to purchase and hold Shares and
such entity has not been formed for the specific purpose of acquiring
Shares in the Offering. If the Investor is one of the aforementioned
entities, it hereby agrees that upon request of the Company it will supply
the Company with any additional written information that may be requested
by the Company.
3. Survival. The representations and warranties contained in Section 2
herein will survive the Closing.
4. Reliance on Representations and Warranties; Indemnity. The Investor
understands that the Company will rely on the representations and
warranties of the Investor herein in determining whether a sale of the
Shares to the Investor is in compliance with federal and applicable state
securities laws. The Investor hereby agrees to indemnify and hold the
Company and its officers, directors, agents, employees and affiliates
harmless from and against any and all liability, damage, cost or expense
(including reasonable attorneys' fees) incurred on account of or arising
out of: (a) any inaccuracy in the Investor's acknowledgments,
representations and warranties set forth in this Agreement; (b) the
disposition of any of the Shares which the Investor will receive, contrary
to the Investor's acknowledgments, representations and warranties in this
Agreement; (c) any suit or proceeding based upon the claim that said
acknowledgments, representations or warranties were inaccurate or
misleading or otherwise cause for obtaining damages or redress from the
Company or its affiliates or the disposition of all or any part of the
Investor's Shares; and (d) the Investor's failure to fulfill any or all of
the Investor's obligations herein.
5. Updating Information. All of the information set forth herein with
respect to the Investor, including, without limitation, all of the
acknowledgments, representations and warranties set forth herein, is
correct and complete as of the date hereof and, if there should be any
material change in such information prior to the acceptance of this
subscription by the Company, the Investor will immediately furnish the
revised or corrected information to the Company.
6. Notices. Any notices or other communications required or permitted
hereunder shall be sufficiently given if in writing and sent by registered
or certified mail, postage prepaid, return receipt requested, if to the
Company, to: Televar Northwest, Inc., 000 Xxxxxx Xxxxxx, Xxxxxxxxx,
Xxxxxxxxxx 00000, Attn: Mr. Xxxx Xxxxxxxx, President; if to the Investor,
at the address set forth following the Investor's signature to this
Agreement,
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or to such other address as either the Company or the Investor shall
designate to the other by notice in writing.
7. Successors; Amendment. This Agreement inures to the benefit of and
is binding upon the parties to this Agreement and their heirs, executors,
administrators, successors and permitted assigns. This Agreement may be
amended, modified or terminated only by an agreement in writing, signed by
the parties to be charged by such amendment, modification or termination.
8. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Washington.
9. Signatures. The Investor declares under penalty of perjury that the
statements, acknowledgments, representations and warranties contained
herein are true, correct and complete and that this Agreement was executed
at: Wenatchee, Washington.
Number of Shares: 30,000
--------------
Total purchase price: $30,000.00
---------------
Make all certified or bank checks payable to "Televar Northwest, Inc."
Exact name(s) in which ownership
of Shares is to be registered: Xxxxx X. Xxxxxxxxxx
-------------------------------------------------
Address: 000 00xx Xx. XX
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Xxxx, Xxxxx, Zip Code: X. Xxxxxxxxx, XX 00000
---------------------------------------------------------
Subscriber Joint Subscriber: (if necessary)
---------- --------------------------------
Xxxxx X. Xxxxxxxxxx
------------------------------ ---------------------------------
(Print Name) (Print Name)
/s/
------------------------------ ---------------------------------
(Signature) (Signature)
------------------------------ ---------------------------------
(Title) (Title)
Date: May 10, 1996 Date:
------------------------- ----------------------------
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RECEIVED AND ACCEPTED:
$ 30,000 for 30,000 Shares
--------------------- ----------
Date: May 10, 1996
-------------------------
TELEVAR NORTHWEST, INC.
By /s/
---------------------------------
Its Chairman & CEO
------------------------------
Print Name Xxxxxxx X. XxXxxx
-------------------------
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APPENDIX: INVESTOR QUALIFICATIONS
I. ACCREDITED INVESTOR.
The Undersigned qualifies under the following category or categories
of definitions of "accredited investor" (indicate each applicable
category):
A. The Undersigned is a natural person whose individual net worth, or
joint net worth with that person's spouse, exceeds $1,000,000.
(___) Yes (___) No
B. The Undersigned is a natural person who had an individual income in
excess of $200,000 in each of the two most recent years or joint income
with that person's spouse in excess of $300,000 ($200,000 for California
residents) in each of those years and has a reasonable expectation of
realizing the same income level in the current year.
(___) Yes (___) No
C. The Undersigned is a broker or dealer registered pursuant to
Section 15 of the Securities Exchange Act of 1934, as amended.
(___) Yes (___) No
D. The Undersigned is an insurance company, a registered securities
broker or dealer, a licensed Small Business Investment Company, a
registered investment company, a business development company as defined in
Section 2(a)(48) of the Investment Company Act of 1940 or a private
business development company as defined in Section 202(a)(22) of the
Investment Advisers Act of 1940.
(___) Yes (___) No
E. The Undersigned is an organization described in Section 501(c)(3)
of the Internal Revenue Code of 1986, as amended, or a corporation,
Massachusetts or similar business trust or partnership, not formed for the
specific purpose of acquiring the Shares, with total assets in excess of
$5,000,000.
(___) Yes (___) No
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F. The Undersigned is a trust with total assets in excess of
$5,000,000, not formed for the specific purpose of acquiring the Shares
offered, whose purchase is directed by a person who has such knowledge and
experience that he or she is capable of evaluating the merits and risks of
the proposed investment.
(___) Yes (___) No
G. The Undersigned is a bank, savings and loan association or similar
institution acting in its individual or fiduciary capacity, or an employee
benefit plan with total assets in excess of $5,000,000.
(___) Yes (___) No
H. The Undersigned is a Plan established and maintained by a state,
its political subdivisions, or any agency or instrumentality of a state or
its political subdivisions for the benefit of its employees, with total
assets in excess of $5,000,000.
(___) Yes (___) No
I. The Undersigned is an employee benefit plan within the meaning of
the Employment Retirement Income Security Act of 1974 ("ERISA"), the
investment decisions for which are made by a plan fiduciary, as defined in
Section 3(21) of ERISA, which is either a bank, savings and loan
association, insurance company, or registered investment adviser, or is an
employee benefit plan that has total assets in excess of $5,000,000.
(___) Yes (___) No
J. The Undersigned is an entity in which all of the equity owners are
accredited investors or individuals who are accredited investors (as
defined above).
(___) Yes (___) No
II. INDIVIDUAL.
(Please complete the following items A through C if the Investor is an
individual.)
A. Name of present employer:
----------------------------------------------
Nature of employment:
--------------------------------------------------
If self-employed, nature of business:
----------------------------------
Period of Employment: _____ years
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Describe the nature of other business involvement or employment
during the past 10 years:
Name of companies of which you are or have been an officer, and
office held:
Additional experience in the financial aspects of business:
Educational background (institutions attended, degrees):
Please provide below any additional information you think may be
helpful in determining that your knowledge in financial and
business matters are sufficient to enable you to evaluate the
merits and risks of this investment.
B. The Undersigned and spouse have a combined net worth, (including
the value of the Undersigned's principal residence valued at cost or based
on an appraisal by a qualified appraiser, net of encumbrances) of:
Less than $150,000 _______________
$150,000 - $500,000 _______________
$500,000 - $1,000,000 _______________
Over $1,000,000 _______________
C. Income of the Undersigned (excluding spouse's income):
1. Investor 2. Spouse
-------- ------
(if Spouse is
subscribing)
Calendar year ended 12/31/95: $_____________ $_____________
Calendar year ended 12/31/94: $_____________ $_____________
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Expected income from the
calendar year ending
12/31/96: $_____________ $_____________
Estimated percentage of
income currently derived
from sources other than
salary: _____% ____%
III. BUSINESS ENTITY.
(Please complete the following Items A through D if the Investor is a
business entity).
A. Nature of Entity.
The Undersigned is (check one):
_____ a corporation
_____ a partnership
B. Other Information.
(1) State of incorporation or organization:
(2) Federal Tax Identification No.:
(3) The entity was formed more than six months prior to the date
hereof, or is engaged in a regular business not solely related to the
investment contemplated hereby.
(___) Yes (___) No
(4) Net worth of entity:
Less than $150,000 _______________
$150,000 - $500,000 _______________
$500,000 - $1,000,000 _______________
Over $1,000,000 _______________
C. Total number of equity owners of the business entity (e.g., all
shareholders of a corporation or all partners in a partnership):
D. Equity owners of corporations and partnerships:
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(1) All equity owners are individuals and each has a net worth in
excess of $1,000,000 (calculated as specified in Item I.A.):
(___) Yes (___) No
(2) All equity owners are individuals and each had an individual
income in excess of the amounts described in I.B. for 1995 and 1994 and
expects the same level of income for 1996:
(___) Yes (___) No
IV. INDIVIDUALS AND BUSINESS ENTITIES
A. Total assets owned by the Undersigned, represented by unmarketable
investments:
( ) Less than 10%
( ) 10% - 20%
( ) 20% - 50%
( ) Over 50%
The Undersigned has invested in unmarketable securities (check one):
( ) often
( ) more than once
( ) once
( ) never
B. The Undersigned has been making investments for at least five
years:
(___) Yes (___) No
C. The Undersigned has invested in marketable securities (check one):
( ) often
( ) occasionally
( ) seldom
( ) never
D. The present or past investments of the Undersigned include (check
one or more):
( ) stocks
( ) bonds
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( ) mutual funds
( ) other (please specify)
-----------------------------
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E. The Undersigned has attached additional or supplemental information
which the Undersigned deems relevant in determining whether the investment
is suitable for the Undersigned.
(___) Yes (___) No
V. SIGNATURES
To the best of the Undersigned's knowledge and belief, the undersigned
declares that the above information is complete, true and correct in all
respects and the undersigned understands that the Company will rely on the
accuracy of such information.
EXECUTED this ___ day of _____________, 1996, at
--------------------, -----------------------------------------.
(City) (State or Province or Country (if other
than U.S. or Canada))
---------------------------
Name (Please Type or Print)
--------------------------- ------------------------------
Signature Signature of Spouse (if Spouse
is subscribing)
---------------------------
Title of Signator (if
Subscriber is other than an
individual)
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