SUBSCRIPTION AGREEMENT
Agreement (this "Agreement"), made this ---- day of -------------, 2002 by and
between INTERNATIONAL TEST SYSTEMS, INC. a Delaware corporation (the "Company")
and ---------------------------------------------- ("Subscriber"). In
consideration of the mutual promises and covenants herein contained, the parties
hereto (the "Parties") agree as follows:
1. ARTICLE I
SUBSCRIPTION
1.1. Subscription Offer. Subject to the terms and conditions hereof and to
acceptance by the Company, the Subscriber hereby offers to purchase
------------------ Shares of Common Stock at $0.40 per share and
____________class "A" Warrants and _________ Class "B" Warrant each at a
purchase at a price of $.10 per Warrant, for a total purchase price of
$______________. The price is payable in full by check payable to "
__________ Bank, on behalf of INTERNATIONAL TEST SYSTEMS, INC." or by wire
transfer or money order.
1.2. Acceptance of Subscription. The Company reserves the right to reject the
Subscriber's offer in whole or in part, for any reason, and to allocate
less than the maximum number of Securities the Subscriber hereby offers to
purchase. Any sale of Securities to the Subscriber shall not be deemed to
occur until the Subscribers' offer is accepted in writing by the Company.
The Subscriber shall not have any recourse against the Company if a
purchase offer is rejected in whole or in part. The Company shall
reasonably notify the Subscriber in writing of the acceptance of a purchase
offer. If the offer is rejected in whole or in part, the Company will
promptly return to the Subscriber, without deduction or interest, all or a
ratable portion of the subscription price, as the case may be, together
with all executed documents tendered by the Subscriber. If the purchase
offer is rejected in part only, the Subscriber shall immediately complete,
execute, and deliver to the Company new subscription documents for the
appropriate reduced amount.
2. ARTICLE II
REPRESENTATIONS AND WARRANTIES
2.1. Status of Subscriber. The Subscriber, if an individual, is at least 21
years of age. If an association, each individual of the association is at
least 21 years of age.
2.2. Access to Information. Because of the Subscriber's business or financial
experience or his professional advisors who are unaffiliated with and who
are not compensated by the Company, or any affiliate thereof, the
Subscriber has the capacity to protect his own interests in connection with
the offer and sale of the Securities. The Subscriber represents he has
received and retained the Company's prospectus (the "Prospectus").
2.3. Understanding of Investment Risks. The Subscriber understands that there is
no market for the Securities and no assurance that a market will develop,
and that realization of the objectives of the Company is subject to
significant economic and business risks as set forth in the Prospectus.
2.4. Residence of the Subscriber. The residence of the Subscriber set forth
below is the true and correct residence of Subscriber and the Subscriber
has no present intention of becoming a resident or domiciliary of any other
state, country, or jurisdiction.
2.5. Further Assurance. Subscriber will execute and deliver to the Company any
document, or do any other act or thing, which the Company may reasonably
request in connection with the acquisition of the Securities.
2.6. Ability to Bear Economic Risk. The Company is making the determination that
the Subscriber is (1) an "accredited investor" as defined in rules to the
Act, (2) a sophisticated purchaser, or (3) otherwise qualified under the
jurisdiction of the Subscriber's residence to make this investment.
2.7. For Partnership, Corporations, Trusts or Other Entities Only. If the
Subscriber is a partnership, corporation, trust, or other entity:
The Subscriber has the full power and authority to execute this
subscription Agreement on behalf of the entity and to make the
representations and warranties made herein on its behalf and this
investment in the Company has been affirmatively authorized by the
governing board of the entity and is not prohibited by the governing
documents of the entity.
3. ARTICLE III
MISCELLANEOUS PROVISIONS
3.1. Captions and Headings. The Article and Section headings throughout this
Agreement are for convenience of reference only and shall in no way be
deemed to define, limit or add to any provision of this Agreement.
3.2. Entire Agreement; Amendment. This Agreement states the entire agreement and
understanding of the Parties and shall supersede all prior agreements and
understandings. No amendment of the Agreement shall be made without the
express written consent of the Parties.
3.3. Severability. The invalidity or unenforceability of any particular
provision of this Agreement shall not affect any other provision hereof,
which shall be construed in all respects as if such invalid or
unenforceable provision were omitted.
3.4. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas for contracts made and to be
performed within the State of Texas.
3.5. Notices. All notices, requests, demands, consents, and other communications
hereunder shall be transmitted in writing and shall be deemed to have been
duly given when hand-delivered or sent by certified mail, postage prepaid,
with return receipt requested, addressed to the Parties as follows: to the
Company and to the Subscriber, at the address indicated below. Any Party
may change his/her/its address for purposes of this Section by giving
notice as provided herein.
IN WITNESS WHEREOF, the Parties have executed this Agreement the day and
year first above written.
INTERNATIONAL TEST SYSTEMS, INC.
0000 Xxxxxxx Xxx, Xxxxx 000
Xxx Xxxxxxx, XX 00000
By:_____________________
Authorized Officer
The Subscriber
--------------------------------
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(Address)
