VGTEL, INC. A NEW YORK CORPORATION PRIVATE PLACEMENT MEMORANDUM SUBSCRIPTION DOCUMENTS REGISTRATION RIGHTS AGREEMENT Series A Units
A
NEW
YORK CORPORATION
PRIVATE
PLACEMENT MEMORANDUM
SUBSCRIPTION
DOCUMENTS
&
REGISTRATION
RIGHTS AGREEMENT
Series
A
Units
Each
Unit
consists of 1 share of common, 1 Series A Warrant, 1 Series B Warrant, 1 Series
C Warrant, 1 Series D Warrant. All series of Warrants are exercisable at $0.25
per underlying share.
▇▇▇▇
▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇
Tel:
(▇▇▇) ▇▇▇-▇▇▇▇
Gentlemen:
The
undersigned hereby subscribes for, and purchases herewith the number of Series
A
Units and underlying common shares $.0001 par value (Units" ") and common stock
purchase warrants (the "Warrants") (collectively the Shares and Warrants are
referred to as "Securities") of VGTel, Inc., a Nevada corporation (the
"Corporation"), set forth below, and as full consideration for the issuance
of
the Securities by the Corporation, the undersigned agrees to pay in cash the
Cash Consideration set forth below. Each Series A Unit of VGTel, Inc. consists
of 1 share of common, 1 Series A Warrant, 1 Series B Warrant, 1 Series C
Warrant, 1 Series D Warrant. All series of Warrants are exercisable at $0.25
per
underlying share.
Each
Warrant is exercisable into one share of Common Stock.
In
consideration of your acceptance of this offer and your authorization for the
issuance of a certificate in my name representing the Securities, the
undersigned hereby represents, warrants and acknowledges to each of you and
the
Corporation that (a) the Securities are being acquired for the account of the
undersigned, for purposes of investment and not with a view to the distribution
thereof, as those terms are used in the Securities Act of 1933, as amended
(the
"Act"), and the rules and regulations promulgated thereunder, (b) the
undersigned has sufficient knowledge and experience in financial and business
matters so as to be capable of evaluating the merits and risks of purchasing
the
Securities, (c) the undersigned has received a copy of the Corporation's Private
Placement Memorandum dated September 15, 2005 and exhibits thereto, (d) the
undersigned has received copies of such documents and such other information
as
the undersigned has deemed necessary in order to make an informed investment
decision with respect to the purchase of the Securities, and (e) the undersigned
understands, and has the financial capability of assuming, the economic risk
of
an investment in the Securities for an indefinite period of time. (f) The
undersigned's overall commitment to investments which are not readily marketable
is reasonable in relation to the undersigned's net worth. (g) The undersigned
hereby agrees to provide such information and to execute and deliver such
documents as may reasonably be necessary to comply with any and all laws and
ordinances to which the Company is subject, including without limitation, such
additional information as the Company or the Placement Agent may deem
appropriate with regard to the undersigned's suitability.
The
undersigned further acknowledges to each of you that the undersigned has been
advised that he will not be able to dispose of the Securities, or any interest
therein, without first complying with the relevant provisions of the Act and
any
applicable state securities laws. The undersigned further understands that
the
provisions of Rule 144 promulgated under the Act, permitting routine sales
of
securities of certain issuers subject to the terms and conditions thereof,
are
not currently, and will not be available, to the undersigned with respect to
the
Securities. The undersigned acknowledges that the Corporation is not under
any
obligation to register the Securities or to furnish any information or take
any
other action, to assist the undersigned in complying with the terms and
conditions of any exemption which might be available under the Act or any state
securities laws with respect to sales of the Securities by the undersigned
in
the future.
Accordingly,
the undersigned agrees to hold the Securities subject to all applicable
provisions of the Act, applicable state securities laws, the Articles of
Incorporation and the By-laws of the Corporation, and any agreement restricting
the disposition or encumbrance of the Securities to which the undersigned is
a
party. The undersigned shall give the Corporation prompt written notice of
any
proposed disposition of the Securities and shall not proceed with any such
proposed disposition unless a registration under the Act is in effect with
respect to the Securities and all state securities laws have been complied
with
or unless the Corporation shall have received an opinion of counsel, of standing
satisfactory to the Corporation, to the effect that such registration is not
required, and the undersigned authorizes the Corporation to place a suitable
legend to this effect on the stock certificate to be issued representing the
Securities.
If
the
undersigned has not received the Private Placement Memorandum prior to the
delivery of this Subscription Agreement, then the undersigned may revoke this
subscription at any time up until three days after receipt of the Private
Placement Memorandum.
The
representations, agreements and acknowledgments set forth above are being given
by the undersigned with the understanding that they will be relied upon by
the
Corporation and its Board of Directors in order to claim the availability of
the
exemption from the registration provisions of the Act contained in Section
4(2)
thereof.
DATED
as
of the 15th of September 2005
Very
truly yours,
____________________________________
Signature
____________________________________
Print
Name
____________________________________
Address
____________________________________
Address
____________________________________
Telephone
Number
____________________________________
Social
Security Number
Number
of
Series A Units Subscribed______ Cash
Consideration $________________
Total
Consideration: $___________________
FOR
ACCREDITED INVESTORS
____ (1)
A
natural person who has individual income of more than $200,000 in each of the
most recent two years or joint income with that persons's spouse in excess
of
$300,000 in each of the most recent two years and who reasonably expects to
reach that same income level for the current year. For this purpose, "individual
income" means adjusted gross income, as reported by a federal income tax
purposes, less any income attributable to a spouse or to property owned by
a
spouse, (A) increased by the individual's share (and not a spouse's share)
of:
(1) the amount of any tax exempt interest income received, (2) amounts
contributed to an ▇▇▇ or ▇▇▇▇▇ retirement plan (3) alimony paid, and (4) the
excluded portion of any long-term capital gains, and (B) adjusted, plus or
minus, for any non-cash loss or gain, respectively, reported for federal
income;
____ (2)
A
natural person whose individual net worth, or joint net worth with that person's
spouse, is in excess of $1,000,000. For this purpose, "net worth" means the
excess of total assets at fair market value, including home and personal
property, over total liabilities, provided, however, for the purpose of
determining a person's net worth, the principal residence owned by an individual
shall be valued at cost, including the cost of improvements, net of current
encumbrances upon the property or valued on the basis of a written appraisal
used by an institutional lender making a loan secured by the property. For
the
purposes of this provisions, "institutional lender" means a bank, savings and
loan company, industrial loan company, credit union, personal property broker
or
a company whose principal business is as a lender upon loans secured by real
property and which has such loans receivable in the amount of $2,000,000 or
more. Any person relying on the appraised value of a principal residence must
deliver to the Company, at or prior to the date of execution hereof, a copy
of
such appraisal;
____ (3)
A
trust, with total assets in excess of $5,000,000, which is not formed for the
purpose of acquiring the Units and whose purchase is directed by a person who
has such knowledge and experience in financial business matters that such person
is capable of evaluating the risks and merits of an investment in the
Units;
____ (4)
A
bank as defined in Section 3(a)(2) of the Securities Act or a savings and loan
association or other institution as defined in Section 3(a)(5)(A) of the
Securities Act whether acting in its individual or fiduciary capacity; a broker
or dealer registered pursuant to Section 15 of the Securities Exchange Act
of
1934; an insurance company as defined in Section 2(13) of the Securities Act;
an
investment company registered under the Investment Company Act of 1940; or
a
business development company as defined in Section 2(a)(48) of the Investment
Company Act of 1940; a small business investment company licensed by the U.S.
Small Business Administration under Section 301(c) or (d) of the Small Business
Investment Act of 1958; a plan established and maintained by a state, its
political subdivisions, or an agency or instrumentality of a state or its
political subdivisions, for the benefit of its employees, if such plan has
total
assets in excess of $5,000,000; or an employee benefit plan within the meaning
of Title I of the Employee Retirement Income Security Act of 1974, if the
investment decision is made by a plan fiduciary, as defined in Section 3(21)
of
the Employee Retirement Income Security Act of 1974, which is either a bank,
savings and loan association, insurance company, or registered investment
adviser, or if the employee benefit plan has total assets in excess of
$5,000,000 or, if the employee benefit plan is a self-directed plan and the
investment decision is made solely by persons who are accredited investors;
____ (5)
A
private business development company as defined in Section 202(a)(22) of the
Investment Advisers Act of 1940;
____ (6)
An
organization described in Section 501(c)(3) of the Internal Revenue Code of
1986, as amended, a corporation, Massachusetts or similar business trust, or
partnership, not formed for the specific purpose of acquiring the Units with
total assets in excess of $5,000,000;
____ (7)
A
director or executive officer of the Company;
or
____ (8)
An
entity in which all of the equity owners meet the requirements of at least
one
of the above subparagraphs for accredited investors.
(d) FOR
QUALIFIED INSTITUTIONAL BUYERS
____ (1)
An
insurance company as defined in Section 2(13) of the Securities Act, acting
for
its own account or the accounts of other qualified institutional buyers which,
in the aggregate, owns or invests on a discretionary basis at least $100 million
in securities of issuers that are not affiliated with it;
____ (2)
An
investment company registered under the Investment Company Act of 1940 (the
"Investment Company Act") or any business development company as defined in
Section 2(a)(48) of that Act, acting for its own account or the accounts of
other qualified institutional buyers which, in the aggregate, owns or invests
on
a discretionary basis at least $100 million in securities of issuers that are
not affiliated with it;
____ (3)
A
Small Business Investment Company licensed by the U.S. Small Business
Administration under Section 301(c) or (d) of the Small Business Investment
Act
of 1958, acting for its own account or the accounts of other qualified
institutional buyers which, in the aggregate, owns or invests on a discretionary
basis at least $100 million in securities of issuers that are not affiliated
with it;
____ (4)
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, aggregate, owns or invests on a discretionary basis
at
least $100 million in securities of issuers that are not affiliated with
it;
____ (5)
An
employee benefit plan within the meaning of Title I of the Employee Retirement
Income Security Act of 1974, acting for its own account or the accounts of
other
qualified institutional buyers which, in the aggregate, owns or invests on
a
discretionary basis at least $100 million in securities of issuers that are
not
affiliated with it;
____ (6)
A
business development company as defined in Section 202(a)(22) of the Investment
Adviser Act of 1940, acting for its own account or the accounts of other
qualified institutional buyers which, in the aggregate, owns or invests on
a
discretionary basis at least $100 million in securities of issuers that are
not
affiliated with it;
____ (7)
An
organization described in Section 501(c)(3) of the Internal Revenue Code of
1986, as amended, a corporation (other than a bank as defined in Section 3(a)(2)
of the Securities Act or a savings and loan association or other institution
referenced in Section 3(a)(5)(A) of the Securities Act or a foreign bank or
savings and loan association or equivalent institution, partnership, or
Massachusetts or similar business trust, acting for its own account or the
accounts of other qualified institutional buyers which, in the aggregate, owns
or invests on a discretionary basis at least $100 million in securities of
issuers that are not affiliated with it;
____ (8)
An
investment adviser registered under the Investment Advisers Act of 1940, acting
for its own account or the accounts of other qualified institutional buyers
which, in the aggregate, owns or invests on a discretionary basis at least
$100
million in securities of issuers that are not affiliated with it;
____ (9)
A
dealer registered pursuant to Section 15 of the Exchange Act or 1934, acting
for
its own account or the accounts of other qualified institutional buyers, which,
in the aggregate, owns and invests on a discretionary basis at least $10 million
of securities of issuers that are not affiliated with the dealer, provided
that
securities constituting the whole or a part of an unsold allotment to or
subscription by a dealer as a participant in a public offering shall not be
deemed to be owned by such dealer;
____ (10)
A
dealer registered pursuant to Section 15 of the Securities Exchange Act of
1934
acting in a riskless principal transaction on behalf of a qualified
institutional buyer;
____ (11)
An
investment company registered under the Investment Company Act, acting for
its
own account or for the accounts of other qualified institutional, that is part
of a family of investment companies which own, in the aggregate, at least $100
million in securities of issuers, other than issuers that are affiliated with
the investment company or are part of such family of investment companies.
"Family of investment companies" means any two or more investment companies
registered under the Investment Company Act (except for a unit investment trust
whose assets consist solely of Units of one or more registered investment
companies) that have the same investment adviser (or, in the case of unit
investment trusts, the same depositor), provided that for purposes of this
paragraph (11);
(A) Each
series of a series company (as defined in Rule 18f-2 under the Investment
Company Act) shall be deemed to be a separate investment company;
and
(B) Investment
companies shall be deemed to have the same adviser (or depositor) if their
adviser (or depositors) are majority-owned subsidiaries of the same parent,
or
if one investment company's adviser (or depositor) is a majority-owned
subsidiary of the other investment company's adviser (or
depositor).
____ (12)
An
entity, all of the equity owners of which are qualified institutional buyers,
acting for its own account or the accounts of other qualified institutional
buyers; and
____ (13)
A
bank as defined in section 3(a)(2) of the Securities Act, savings and loan
association or other institution as referenced in Section 3(a)(5)(A) of the
Securities Act, or foreign bank or savings and loan association or equivalent
institution, acting for its own account or the accounts of other qualified
institutional buyers, which, in the aggregate, owns and invests on a
discretionary basis at least $100 million in securities of issuers that are
not
affiliated with it and that has an audited net worth of at least $25 million
as
demonstrated in its latest annual financial statements, as of a date not more
than 16 months preceding the date of execution hereof, in the case of a U.S.
bank or savings and loan association, and not more than 18 months preceding
the
date of execution hereof, in the case of a foreign bank or savings and loan
association or equivalent institution.
(e) The
undersigned's overall commitment to investments which are not readily marketable
is reasonable in relation to the undersigned's net worth.
(f) The
undersigned hereby agrees to provide such information and to execute and deliver
such documents as may reasonably be necessary to comply with any and all laws
and ordinances to which the Company is subject, including without limitation,
such additional information as the Company or the Placement Agent may deem
appropriate with regard to the undersigned's suitability.
____ (14)
NASD
Affiliation.
Are
you
affiliated or associated with an NASD member firm (please check
one):
Yes______ No______
If
Yes,
please described:
_________________________________________________________
_________________________________________________________
_________________________________________________________
*
If
undersigned is a Registered Representative with an NASD member firm, have the
following acknowledgement signed by the appropriate party:
The
undersigned NASD member firm acknowledges receipt of the notice required by
Article 3, Sections 28(a) and (b) of the Rules of Fair Practice.
_____________________________________
Name
of
NASD Member Firm
By:__________________________________
Authorized
Officer
Date:________________________________
The
undersigned is informed of the significance to you of the foregoing
representations and answers contained in the undersigned representations
contained in this Paragraph 5 and such answers have been provided under the
assumption that the Corporation will rely on them.
(g) The
undersigned acknowledges:
(1)
That
the undersigned is aware that investment in the Units involves a number of
very
significant risks, and has carefully read and considered the matters set forth
under the caption "Risk Factors" in the Memorandum;
(2)
In
making an investment decision the undersigned has relied on the undersigned's
own examination of the Company and the terms of the Offering, including the
merits and risks involved. These Units have not been recommended by any federal
or state securities commission or regulatory authority. Furthermore, the
foregoing authorities have not confirmed the accuracy or determined the adequacy
of the Memorandum or this document. Any representation to the contrary is a
criminal offense.
(3)
The
undersigned, if executing this Subscription Agreement in a representative or
fiduciary capacity, has full power and authority to execute and deliver this
Subscription Agreement in such capacity and on behalf of the subscribing
individual, ▇▇▇▇, partnership, trust, estate, corporation, or other entity
for
whom the undersigned is executing this Subscription Agreement, and such
individual, ▇▇▇▇, partnership, trust, estate, corporation, or other entity
has
full right and power to perform pursuant to this Subscription Agreement and
make
an investment in the Company; and
(4)
The
representations, warranties, and agreements of the undersigned contained herein
and in any other writing delivered in connection with the transactions
contemplated hereby shall be true and correct in all respects on and as of
the
date of the sale of the Units as if made on and of such date and shall survive
the execution and delivery of this Subscription Agreement and the purchase
of
the Units.
6. Indemnification.
The
undersigned agrees to indemnify and hold harmless the Company, the Placement
Agent, the Selected Dealers and their respective officers, directors, agents,
and affiliates against any and all loss, liability, claim, damage, and expense
whatsoever (including, but not limited to, any and all expenses reasonably
incurred in investigating, preparing, or defending against any litigation
commenced or threatened or any claim whatsoever) arising out of or based upon
any false representation or warranty or breach or failure by the undersigned
to
comply with any covenant or agreement made by the undersigned herein or in
any
other document furnished by the undersigned to any of the foregoing in
connection with this transaction.
7. Irrevocability;
Binding Effect.
The
undersigned hereby acknowledges and agrees that the subscription hereunder
is
irrevocable by the undersigned, that, except as required by law, the undersigned
is not entitled to cancel, terminate, revoke this Subscription Agreement or
any
agreements of the undersigned hereunder, and shall be binding upon and inure
to
the benefit of the parties and their heirs, executors, administrators,
successors, legal representatives, and permitted assigns. If the undersigned
is
more than one person, the obligations of the undersigned hereunder shall be
joint and several and the agreements, representations, warranties, and
acknowledgments herein contained shall be deemed to be made by and be binding
upon each such person and his/her heirs, executors, administrators, successors,
legal representatives, and permitted assigns.
8. Modification.
Neither
this Subscription Agreement nor any provisions hereof shall be waived, modified,
discharged, or terminated except by an instrument in writing signed by the
party
against whom any such waiver, modification, discharge, or termination is
sought.
9. Notices.
Any
notice or other communication required or permitted to be given hereunder shall
be in writing and shall be personally delivered or deemed delivered the third
business day after being mailed by first class mail, to the party to receive
same (a) if to the Company, to VGTel, Inc., ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇
▇▇▇▇
▇▇▇▇▇, or (b) if to the undersigned, at the address set forth on the signature
page hereof (or, in either case, to such other address as the party shall have
furnished in writing in accordance with the provisions of this Section 9).
Any
notice or other communication given by certified mail shall be deemed given
at
the time of receipt thereof.
10. Assignability.
This
Subscription Agreement and the rights and obligations hereunder are not
transferable or assignable by the undersigned.
11. Applicable
Law. Notwithstanding
the place where this Subscription Agreement may be executed by any of the
parties hereto, the parties expressly agree that all of the terms and provisions
hereof except by operation of law and laws of decent shall be construed in
accordance with the laws of the State of New York without regard to principles
of conflicts of law and any dispute brought hereunder shall be brought in a
Federal or State court located in either the Southern or Eastern Districts
of
New York.
12. Upon
the
execution and delivery of this Agreement by the Subscriber, this Agreement
shall
become a binding obligation of the Subscriber with respect to the purchase
of
Units as herein provided; subject, however, to the right hereby reserved to
the
Corporation to enter into the same agreements with other subscribers and to
add
and/or delete other persons as subscribers.
13. It
is
agreed that a waiver by either party of a breach of any provision of this
Agreement shall not operate, or be construed, as a waiver of any subsequent
breach by that same party.
14. The
parties agree to execute and deliver all such further documents, agreements
and
instruments and take such other and further action as may be necessary or
appropriate to carry out the purpose and intent of this Agreement.
15. State
Securities Laws.
Subscribers who reside in CALIFORNIA, PENNSYLVANIA or MASSACHUSETTS also agree
and represent as follows:
(a) THE
UNDERSIGNED, IF A CALIFORNIA RESIDENT, REPRESENTS THAT: (1) THE UNDERSIGNED
OR
THE UNDERSIGNED'S PROFESSIONAL ADVISER CAN PROTECT THE UNDERSIGNED'S INTEREST
IN
CONNECTION WITH THIS TRANSACTION; (2) THE UNDERSIGNED IS ABLE TO BEAR THE
ECONOMIC RISK OF THIS INVESTMENT OR (3) THIS INVESTMENT DOES NOT EXCEED 10%
OF
SUCH PERSON'S NET WORTH OR JOINT NET WORTH WITH SUCH PERSON'S
SPOUSE.
(b) THE
UNDERSIGNED, IF A PENNSYLVANIA RESIDENT, REPRESENTS THAT THE UNDERSIGNED WILL
NOT SELL ANY Units FOR A PERIOD OF TWELVE (12) MONTHS FROM THE DATE OF PURCHASE
IF THIS SUBSCRIPTION IS NOT TIMELY WITHDRAWN PURSUANT TO THE RIGHT OF RECISION
GRANTED UNDER THE PENNSYLVANIA SECURITIES ACT, UNLESS SUCH SECURITIES ARE
SUBSEQUENTLY REGISTERED UNDER FEDERAL SECURITIES LAWS OR ARE SOLD IN ACCORDANCE
WITH PENNSYLVANIA SECURITIES LAWS. ANY OFFEREE WHO IS A RESIDENT OF PENNSYLVANIA
HAS THE RIGHT TO WITHDRAW THIS SUBSCRIPTION, WITHOUT INCURRING ANY LIABILITY
TO
THE COMPANY, THE SELLING AGENT OR ANY OTHER PERSON AND TO CANCEL THE PURCHASE
OF
Units, WITHIN TWO (2) BUSINESS DAYS FROM THE DATE OF RECEIPT BY THE COMPANY
OF A
WRITTEN BINDING CONTRACT OF PURCHASE OR, IN THE CASE OF A TRANSACTION IN WITH
THERE IS NO WRITTEN BINDING CONTRACT OF PURCHASE, WITHIN TWO (2) BUSINESS DAYS
AFTER THE INITIAL PAYMENT FOR THE Units BEING OFFERED.
SIGNATURE
OF PENNSYLVANIA RESIDENT:________________________________
(c) THE
UNDERSIGNED, IF A MASSACHUSETTS RESIDENT, REPRESENTS THAT THE UNDERSIGNED'S
INVESTMENT IN THE Units DOES NOT EXCEED 25% OF SUCH PERSON'S NET WORTH OR,
IF
MARRIED, THE COMBINED NET WORTH OF SUCH PERSON'S SPOUSE AND THE UNDERSIGNED,
EXCLUDING PRINCIPAL RESIDENCE AND HOME FURNISHINGS.
Nature
of
Subscriber. The undersigned is (check one):
_____ (a) One
or
more individuals
_____ (b) A
corporation
_____ (c) A
partnership
_____ (d) A
trust
_____ (e) Another
entity or organization,
namely
(please specify): _________________________
Other
Certifications. By signing the Signature Page, the undersigned certifies as
follows:
(a) that
the
undersigned and its grantor (if a trust) or its general partners (if a
partnership) have not filed or been involved in bankruptcy
proceedings;
if
the
undersigned is an individual investor, that one of the following is true and
correct (check one):
Spouse
if
Purchaser Co-Owner
____
____
(1)
I am
a United States citizen or resident of the United States for United States
federal income tax purposes.
____ ____ (2)
I am
neither a United States citizen nor a resident of the United States for federal
income tax purposes.
(c) if
the
undersigned is a trust, that the trust has not been established in connection
with either (1) an employee benefit plan (as defined in Section 3(3) of ERISA),
whether or not subject to the provisions of Title I of ERISA, or (2) a plan
described in Section 4975(e)(i) of the Internal Revenue Code and that one of
the
following is true and correct (check one):
____ (1)
the
Trust is an estate or trust whose income from sources outside the United States
is includable in its gross income for United States federal income tax purposes
regardless of its connection with a trade or business carried on the United
States.
____ (2)
the
Trust is an estate or trust whose income from sources outside the United States
is not includable in its gross income for United States federal income tax
purposes regardless of its connection with a trade or business carried on in
the
United States.
(d) if
the
undersigned is a partnership, that the assets of the partnership do not
constitute "plan assets" within the meaning of ERISA and regulation S 2510.3-101
promulgated thereunder and that one of the following is true and correct (check
one):
_____ (1)
the
Partnership is a partnership formed in or under the laws of the United States
or
any political subdivision thereof.
_____
(2)
the
Partnership is a partnership not formed in or under the laws of the United
States or any political subdivision thereof.
(e) if
the
undersigned is a corporation, that the assets of the Corporation do not
constitute "plan assets" within the meaning of ERISA and regulation S2510.3-101
promulgated thereunder and that one of the following is true and correct (check
one):
____ (1)
the
Corporation is a corporation organized in or under the laws of the United States
or any political subdivision thereof.
____ (2)
the
Corporation is a corporation which is neither created nor organized in or under
the United States or any political subdivision thereof but which has made an
election under either Section 897(i) or 897(k) of the United States Internal
Revenue Code of 1986, as amended, to be treated as a domestic corporation for
certain purposes of United States federal income taxation (A copy of the
Internal Revenue Service acknowledgment of the undersigned's election must
be
attached to this Subscription Agreement if this provision is
applicable).
____
(3)
neither (1) nor (2) above is true.
SUBSCRIPTION
AGREEMENT SIGNATURE PAGE FOR INDIVIDUAL INVESTORS
IN
WITNESS WHEREOF, the undersigned has executed this Agreement this _______ day
of
Number
of
Units being subscribed for:
________________________________________
Print
Name
________________________________________
Signature
of Investor
________________________________________
Social
Security Number
________________________________________
Residence
Address
________________________________________
If
the
purchaser has indicated that the Units will be held as JOINT TENANTS, as TENANTS
IN COMMON, or as COMMUNITY PROPERTY, please complete the following:
_________________________________________
Print
Name of Spouse or Other Purchaser
_________________________________________
Signature
of Spouse or Other Purchaser
_________________________________________
Social
Security Number
ACCEPTED
AND AGREED:
By:
_______________________________
▇▇▇
▇▇▇▇▇▇,
President
& Chief Financial Officer
Dated:
____________, 2005
IF
YOU
ARE PURCHASING UNITS WITH YOUR SPOUSE, YOU MUST BOTH SIGN THE SIGNATURE PAGE.
IF
YOU ARE PURCHASING UNITS WITH ANOTHER PERSON NOT YOUR SPOUSE, YOU MUST
EACH
FILL OUT
ALL AREAS OF THIS AGREEMENT APPLICABLE TO AN INDIVIDUAL
PURCHASER.
SUBSCRIPTION
AGREEMENT SIGNATURE PAGE FOR PARTNERSHIPS,
CORPORATIONS,
TRUSTS, OR OTHER ENTITIES
IN
WITNESS WHEREOF, the undersigned has executed this Agreement this ___ day of
_______, 2005
Number
of
Units being subscribed for:___________________
_________________________________________
Print
Name of Partnership, Corporation,
Trust
or
other Entity
_________________________________________
(Signature
of Authorized Signatory)
Name:_____________________________________
Title:____________________________________
Address:___________________________________
_________________________________________
__________________________________________
Taxpayer
Identification Number:__________________
Date
of
Formation:___________________________
Address
of Chief Executive Office of Subscriber:
__________________________________________
_________________________________________
_________________________________________
ACCEPTED
AND AGREED:
By:
_______________________________
▇▇▇
▇▇▇▇▇▇
President
& Chief Financial Officer
Dated:
______________2005
PROSPECTIVE
PURCHASER QUESTIONNAIRE
For
Confidential Private Offering
▇▇▇▇
▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇
The
information contained herein in being furnished to you in order for you to
determine whether a sale of a Unit (the "Units") in VGTel, Inc. (the "Company")
may be made to the undersigned, pursuant to Section 4 (2) of the Securities
Act
of 1933 (the "Act") and Regulation D promulgated thereunder. The undersigned
understands that (i) you will rely upon the information contained herein for
purposes of such determination, (ii) the securities will not be registered
under
the Act in reliance upon the exemption from registration provided by Section
4
(2) of the Act and Rule 506 of Regulation D, promulgated thereunder and (iii)
this questionnaire is not an offer to sell securities to the
undersigned.
The
undersigned further represents to you that (i) the information contained herein
is complete and accurate and may be relied upon by you, and (ii) the undersigned
will notify you immediately of any material change in any of such information
occurring prior to the purchase of such securities, if any purchase is made,
by
the undersigned.
THE
UNDERSIGNED UNDERSTANDS AND AGREES THAT, ALTHOUGH THIS QUESTIONNAIRE WILL BE
KEPT STRICTLY CONFIDENTIAL, THE ISSUER OF ANY SECURITIES PURCHASED BY THE
UNDERSIGNED MAY PRESENT THIS QUESTIONNAIRE TO SUCH PARTIES AS IT DEEMS ADVISABLE
IF CALLED UPON TO ESTABLISH THE AVAILABILITY UNDER ANY FEDERAL OR STATE
SECURITIES LAWS OF AN EXEMPTION FROM REGISTRATION OF THE PRIVATE
PLACEMENT.
THIS
LETTER IS NOT AN OFFER TO SELL SECURITIES BUT MERELY A REQUEST FOR INFORMATION
PURSUANT TO REGULATION D OF THE SECURITIES AND EXCHANGE COMMISSION.
Please
complete, sign, date and return one copy of this questionnaire to the Company at
▇▇▇▇
▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇
PLEASE
TYPE OR PRINT
1. Name:
________________________________________________________
Date
of
Birth: _________________________
Social
Security Number:_________________
Citizenship:
_______________ Marital Status: _____________
Number
of
Dependents: ______
Where
Registered to Vote: ____________________________________
State
of
Issuance of Driver's License: _______________________
Home
Address:_________________________________________________
Home
Telephone Number:________________________________________
2. Firm
Name: ___________________________________________________
Nature
of
Business: __________________________________________
Position:
____________________________________________________
Nature
of
Duties: ____________________________________________
Business
Address: ____________________________________________
Business
Telephone Number: ___________________________________
3. Your
employment, positions or occupations during the past 5 years (and the inclusive
dates of each) are as follows (Note: What is sought is a sufficient description
to enable the Issuer to determine the extent of vocationally related experience
in financial and business matters):
Employment,
Position Nature
of
or
Occupation Duties
From To
______________________________________________________________
______________________________________________________________
______________________________________________________________
______________________________________________________________
4. 4. Your
general, business or professional education, and the
degrees
received, are as follows:
School Degree Year
Received
______________________________________
______________________________________________________________
______________________________________________________________
______________________________________________________________
______________________________________________________________
5. Was
your
income (from all sources) for each of the latest two complete calendar years
more than (check one):
___
$40,000; ___
$60,000; ___
$80,000;
___
$100,000; ___
$200,000; ___
$500,000.
(a)
What
percentage of your income as shown above was derived from sources other than
salary? _______________
(b)
Approximately what percentage of your income as shown above remained after
payment of Federal, state and local taxes, and after payment of all ordinary
and
necessary business and/or living expenses? ________________
6.
Was
your
income with that of your spouse for each of the latest two complete calendar
years more than (check one):
___
$40,000; ___
$60,000; ___
$80,000;
___
$100,000; ___
$300,000; ___
$500,000.
(a)
What
percentage of your combined income as shown above is derived from sources other
than salary? __________
(b) Approximately
what percentage of your combined income as shown above remained after payment
of
Federal, state and local taxes, and after payment of all ordinary and necessary
business and/or living expenses? ______________________
7. Is
your
income from all sources for the current calendar year reasonably expected to
be
more than (check one):
___
$40,000; ___
$60,000; ___
$80,000;
___
$100,000; ___
$200,000; ___
$500,000?
(a)
What
percentage of your income as shown above will be derived for sources other
than
salary? ___________________
(b)
Approximately what percentage of your income as shown above will remain after
payment of Federal, state, and local taxes, and after payment of all ordinary
and necessary business and/or living expenses?
__________________________
8. Is
your
income with that of your spouse from all sources for the current calendar year
reasonably expected to be more than (check one):
___
$40,000; ___
$60,000; ___
$80,000;
___
$100,000; ___
$300,000; ___
$500,000.
9.
The
undersigned has a net worth, or a joint net worth together with his or her
spouse, in excess: (In calculating net worth, you may include equity in personal
property and real estate, including your principal residence, cash, short-term
investments, stock and securities. Equity in personal property and real estate
should be based on the fair market value of such property minus debt secured
by
such property.)
___
$40,000; ___
$60,000; ___
$80,000;
___
$100,000; ___
$300,000; ___
$500,000.
(a)
What
percentage of your net worth as shown above is invested in tax "shelter"
investments and investments in marketable securities (stocks, bonds, debentures,
or notes)? __________________
(b)
What
percentage of you net worth as shown above constitutes home, furnishings and
automobiles? ________________
(c)
What
percentage of your net worth as shown above
constitutes
liquid assets (cash or assets readily convertible
to
cash)?
____________________
10. Indicate
any other investments or contingent liabilities which you reasonably anticipate
could cause you to require cash in excess of the amount of cash readily
available to you (please specify):
___________________________________________________________________
___________________________________________________________________
___________________________________________________________________
11. Investment
experience:
(a)
Please indicate the frequency of your investment in marketable
securities:
(
)
often; (
)
occasionally; (
)
seldom; (
)
never.
(b)
Please indicate the frequency of your investment in high technology
companies:
(
)
often; (
)
occasionally; (
)
seldom; (
)
never.
(c)
Please indicate the frequency of your investment in options:
(
)
often; (
)
occasionally; (
)
seldom; (
)
never.
(d)
Please indicate the frequency of your investment in securities purchased on
margin:
(
)
often; (
)
occasionally; (
)
seldom; (
)
never.
(I)
Please indicate the frequency of your investment in unmarketable
securities:
(
)
often; (
)
occasionally; (
)
seldom; (
)
never.
12. Please
indicate in the space provided below any additional information which you think
may be helpful in enabling the Issuer to determine that your knowledge and
experience in financial and business matters is sufficient to enable you to
evaluate the merits and risks of this investment.
______________________________________________________________
______________________________________________________________
______________________________________________________________
13. Indicate
whether you are acting for your own account:
Yes__ No
__
(a)
If
not acting for your own account complete the following:
(i) Capacity
in which you are acting (Trustee or otherwise):
__________________________
(ii) Name,
address and telephone number of persons you
represent:
______________________________________________
_________________________________________________________
_________________________________________________________
(iii)
Evidence of authority (please attach).
NOTE:
ANY
INDIVIDUALS REPRESENTED BY YOU MUST ALSO BE QUALIFIED AS "PURCHASERS" PURSUANT
TO RULE 506 AND THE ACT.
To
the
best of my information and belief, the above information supplied by the
undersigned is true and correct in all respects.
IN
WITNESS WHEREOF, I have executed this questionnaire this ___ day of _________
2005.
_______________________________________
(Signature
of Prospective Purchaser)
REGISTRATION
RIGHTS AGREEMENT
This
Registration Rights Agreement (the "Agreement") is made and entered into as
of
September 15, 2005 by and among VGTel, Inc., a Nevada corporation (the
"Company"), and the persons and entities who purchase Units in the Company's
private placement described in a Private Placement Memorandum dated September
15, 2005, (collectively, the "Investors").
WITNESSETH:
WHEREAS,
the Company will issue Units consisting of Common Stock ("Common Stock") and
common stock purchase warrants ("Warrants"); and
WHEREAS,
with respect to the Common Stock and common stock to be acquired by the
Investors upon exercise of the Warrants, the Company has agreed to grant to
the
Investors the rights contained herein.
NOW,
THEREFORE, in consideration of the foregoing recital and the mutual promises
hereinafter set forth, the parties hereto agree as follows:
1. Definitions.
As used
in this Agreement, the following capitalized terms shall have the following
respective meanings:
Closing
Date.
The
term "Closing Date" shall mean the final date of the offering period of the
Units, as described in the Private Placement Memorandum, which may be extended
by the Company.
Exchange
Act.
The
term "Exchange Act" means the United States Securities Exchange Act of 1934,
as
amended.
Holder.
The
term "Holder" means any person owning of record Registrable Securities or any
assignee of record of such Registrable Securities to whom rights under this
Agreement have been duly assigned in accordance with this
Agreement.
Person.
The
term "Person" shall mean an individual, partnership, corporation, trust or
unincorporated organization, or a government or agency or political subdivision
thereof.
Registrable
Securities.
The
term "Registrable Securities" means all the Common Stock and common stock
issuable upon exercise of the Warrants; excluding
in all
cases, however, any of such securities sold by a Person in a transaction in
which rights under this Agreement are not assigned in accordance with this
Agreement.
Registration.
The
terms "register," "registered" and "registration" refer to a registration
effected by preparing and filing a registration statement in compliance with
the
Securities Act, and the declaration or ordering of effectiveness of such
registration statement.
Registration
Statement.
The
term "Registration Statement" shall mean a registration statement filed by
the
Company with the Commission under the Securities Act providing for the offer
and
sale of Registrable Securities.
SEC.
The
term "SEC" or "Commission" means the U.S. Securities and Exchange
Commission.
Securities
Act.
The
term "Securities Act" means the United States Securities Act of 1933, as
amended.
2. Grant
of Registration Rights.
The
Company hereby grants the following registration rights to holders of the
Securities offered in the accompanying Private Placement
Memorandum.
(a) On
one
occasion, for a period commencing 270 days after the Closing Date, but not
later
than three years after the Closing Date, the Company, upon a written request
therefor from any record holder or holders of more than 50% of the aggregate
of
the "Registrable Securities", shall prepare and file with the SEC a registration
statement under the Act covering the Registrable Securities which are the
subject of such request, unless such Registrable Securities are the subject
of
an effective registration statement or are otherwise salable pursuant to an
exemption from registration. In addition, upon the receipt of such request,
the
Company shall promptly give written notice to all other record holders of the
Registrable Securities that such registration statement is to be filed and
shall
include in such registration statement Registrable Securities for which it
has
received written requests within 10 days after the Company gives such written
notice. Such other requesting record holders shall be deemed to have exercised
their demand registration right under this Section 2(a). As a condition
precedent to the inclusion of Registrable Securities, the holder thereof shall
provide the Company with such information as the Company reasonably requests.
The obligation of the Company under this Section 2(a) shall be limited to one
registration statement.
(b) If
the
Company at any time proposes to register any of its securities under the Act
for
sale to the public, whether for its own account or for the account of other
security holders or both, except with respect to registration statements on
Forms ▇-▇, ▇-▇ or another form not available for registering the Registrable
Securities for sale to the public, provided the Registrable Securities are
not
otherwise registered for resale by the Subscriber or Holder pursuant to an
effective registration statement, each such time it will give at least 30 days'
prior written notice to the record holder of the Registrable Securities of
its
intention so to do. Upon the written request of the holder, received by the
Company within 30 days after the giving of any such notice by the Company,
to
register any of the Registrable Securities, the Company will cause such
Registrable Securities as to which registration shall have been so requested
to
be included with the securities to be covered by the registration statement
proposed to be filed by the Company, all to the extent required to permit the
sale or other disposition of the Registrable Securities so registered by the
holder of such Registrable Securities (the "Seller"). In the event that any
registration pursuant to this Section 2(b) or 2(d) shall be, in whole or in
part, an underwritten public offering of common stock of the Company, the number
of shares of Registrable Securities to be included in such an underwriting
may
be reduced by the managing underwriter if and to the extent that the Company
and
the underwriter shall reasonably be of the opinion that such inclusion would
adversely affect the marketing of the securities to be sold by the Company
therein; provided, however, that the Company shall notify the Seller in writing
of any such reduction. Notwithstanding the forgoing provisions, the Company
may
withdraw any registration statement referred to in this Section 2(b) without
thereby incurring any liability to the Seller.
(c) If,
at
the time any written request for registration is received by the Company
pursuant to Section 2(a), the Company has determined to proceed with the actual
preparation and filing of a registration statement under the 1933 Act in
connection with the proposed offer and sale for cash of any of its securities
for the Company's own account, such written request shall be deemed to have
been
given pursuant to Section 2(b) rather than Section 2(a), and the rights of
the
holders of Registrable Securities covered by such written request shall be
governed by Section 2(b).
(d) The
Company shall file with the Commission within 120 days of the final Closing
Date
(the "Filing Date"), and use its reasonable commercial efforts to cause to
be
declared effective a Registration Statement within 270 days of the Closing
Date
(the "Effective Date"). The Company will register one share of Common Stock
in
the afore described registration statement for each share of Common Stock
contained in the Units and one share of Common Stock for each common share
issuable upon exercise of the Warrants. The Registrable Securities shall be
reserved and set aside exclusively for the benefit of the Subscriber and not
issued, employed or reserved for anyone other than the Subscriber. the Company
may delay the Filing Date and Effective Date during the pendency of negotiations
with an underwriter for an initial public offering by the Company of its
securities. Any such delay may not be longer than thirty (30) days in connection
with the Filing Date and sixty (60) days in connection with the Effective
Date.
3. Registration
Procedures.
If and
whenever the Company is required by the provisions hereof to effect the
registration of any shares of Registrable Securities under the Act, the Company
will, as expeditiously as possible:
(a) prepare
and file with the Commission a registration statement with respect to such
securities and use its best efforts to cause such registration statement to
become and remain effective for the period of the distribution contemplated
thereby (determined as herein provided), and promptly provide to the holders
of
Registrable Securities copies of all filings upon request of such holder.
(b) prepare
and file with the Commission such amendments and supplements to such
registration statement and the prospectus used in connection therewith as may
be
necessary to keep such registration statement effective until the latest of:
(i)
six months after the exercise period of the Warrants; or (ii) one year after
the
Closing Date, and comply with the provisions of the Act with respect to the
disposition of all of the Registrable Securities covered by such registration
statement in accordance with the Seller's intended method of disposition set
forth in such registration statement for such period;
(c) furnish
to the Seller, and to each underwriter if any, such number of copies of the
registration statement and the prospectus included therein (including each
preliminary prospectus) as such persons reasonably may request in order to
facilitate the public sale or their disposition of the securities covered by
such registration statement;
(d) use
its
best efforts to register or qualify the Seller's Registrable Securities covered
by such registration statement under the securities or "blue sky" laws of such
jurisdictions as the Seller and in the case of an underwritten public offering,
the managing underwriter shall reasonably request, provided, however, that
the
Company shall not for any such purpose be required to qualify generally to
transact business as a foreign corporation in any jurisdiction where it is
not
so qualified or to consent to general service of process in any such
jurisdiction;
(e) list
the
Registrable Securities covered by such registration statement with any
securities exchange on which the Common Stock of the Company is then listed;
(f) immediately
notify the Seller and each underwriter under such registration statement at
any
time when a prospectus relating thereto is required to be delivered under the
Act, of the happening of any event of which the Company has knowledge as a
result of which the prospectus contained in such registration statement, as
then
in effect, includes an untrue statement of a material fact or omits to state
a
material fact required to be stated therein or necessary to make the statements
therein not misleading in light of the circumstances then existing;
(g) make
available for inspection by the Seller, any underwriter participating in any
distribution pursuant to such registration statement, and any attorney,
accountant or other agent retained by the Seller or underwriter, all publicly
available, non-confidential financial and other records, pertinent corporate
documents and properties of the Company, and cause the Company's officers,
directors and employees to supply all publicly available, non-confidential
information reasonably requested by the seller, underwriter, attorney,
accountant or agent in connection with such registration statement.
4. Provision
of Documents.
(a)
At
the request of the Seller, provided a demand for registration has been made
pursuant to Section 2(a) or a request for registration has been made pursuant
to
Section 2(b), the Registrable Securities will be included in a registration
statement filed pursuant to this Agreement. In the event of an underwritten
public offering in which the Registrable Securities are so included, the lockup,
if any, requested by the managing underwriter may not exceed nine months after
the effective date thereof.
(b)
In
connection with each registration hereunder, the Seller will furnish to the
Company in writing such information and representation letters with respect
to
itself and the proposed distribution by it as reasonably shall be necessary
in
order to assure compliance with federal and applicable state securities laws.
In
connection with each registration pursuant to Section 2(a) or 2(b) covering
an
underwritten public offering, the Company and the Seller agree to enter into
a
written agreement with the managing underwriter in such form and containing
such
provisions as are customary in the securities business for such an arrangement
between such underwriter and companies of the Company's size and investment
stature.
5. Expenses.
All
expenses incurred by the Company in complying with this Agreement, including,
without limitation, all registration and filing fees, printing expenses, fees
and disbursements of counsel and independent public accountants for the Company,
fees and expenses (including reasonable counsel fees) incurred in connection
with complying with state securities or "blue sky" laws, fees of the National
Association of Securities Dealers, Inc., transfer taxes, fees of transfer agents
and registrars, fee of one counsel, if any, to represent all the Sellers, and
costs of insurance are called "Registration Expenses". All underwriting
discounts and selling commissions applicable to the sale of Registrable
Securities, including any fees and disbursements of any special counsel to
the
Seller, are called "Selling Expenses". The Seller shall pay the fees of its
own
additional counsel, if any.
The
Company will pay all Registration Expenses in connection with the Registration
Statement. All Selling Expenses in connection with each Registration Statement
shall be borne by the Seller and may be apportioned among the Sellers in
proportion to the number of shares sold by the Seller relative to the number
of
shares sold under such Registration Statement or as all Sellers thereunder
may
agree.
6. Indemnification
and Contribution.
(a)
In
the event of a registration of any Registrable Securities under the Act pursuant
to this Agreement, the Company will indemnify and hold harmless the Seller,
each
officer of the Seller, each director of the Seller, each underwriter of such
Registrable Securities thereunder and each other person, if any, who controls
such Seller or underwriter within the meaning of the 1933 Act, against any
losses, claims, damages or liabilities, joint or several, to which the Seller,
or such underwriter or controlling person may become subject under the Act
or
otherwise, insofar as such losses, claims, damages or liabilities (or actions
in
respect thereof) arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in any registration statement
under which such Registrable Securities was registered under the Act pursuant
to
this Agreement, any preliminary prospectus or final prospectus contained
therein, or any amendment or supplement thereof, or arise out of or are based
upon the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not misleading,
and will reimburse the Seller, each such underwriter and each such controlling
person for any legal or other expenses reasonably incurred by them in connection
with investigating or defending any such loss, claim, damage, liability or
action; provided, however, that the Company will not be liable in any such
case
if and to the extent that any such loss, claim, damage or liability arises
out
of or is based upon an untrue statement or alleged untrue statement or omission
or alleged omission so made in conformity with information furnished by any
such
Seller, the underwriter or any such controlling person in writing specifically
for use in such registration statement or prospectus.
(b)
In
the event of a registration of any of the Registrable Securities under the
Act
pursuant to this Agreement, the Seller will indemnify and hold harmless the
Company, and each person, if any, who controls the Company within the meaning
of
the Act, each officer of the Company who signs the registration statement,
each
director of the Company, each underwriter and each person who controls any
underwriter within the meaning of the Act, against all losses, claims, damages
or liabilities, joint or several, to which the Company or such officer,
director, underwriter or controlling person may become subject under the Act
or
otherwise, insofar as such losses, claims, damages or liabilities (or actions
in
respect thereof) arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in the registration statement
under which such Registrable Securities were registered under the Act pursuant
to this Agreement, any preliminary prospectus or final prospectus contained
therein, or any amendment or supplement thereof, or arise out of or are based
upon the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not misleading,
and will reimburse the Company and each such officer, director, underwriter
and
controlling person for any legal or other expenses reasonably incurred by them
in connection with investigating or defending any such loss, claim, damage,
liability or action, provided, however, that the Seller will be liable hereunder
in any such case if and only to the extent that any such loss, claim, damage
or
liability arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in reliance upon and in
conformity with information pertaining to such Seller, as such, furnished in
writing to the Company by such Seller specifically for use in such registration
statement or prospectus, and provided, further, however, that the liability
of
the Seller hereunder shall be limited to the proportion of any such loss, claim,
damage, liability or expense which is equal to the proportion that the public
offering price of the Registrable Securities sold by the Seller under such
registration statement bears to the total public offering price of all
securities sold thereunder, but not in any event to exceed the gross proceeds
received by the Seller from the sale of Registrable Securities covered by such
registration statement.
(c)
Promptly after receipt by an indemnified party hereunder of notice of the
commencement of any action, such indemnified party shall, if a claim in respect
thereof is to be made against the indemnifying party hereunder, notify the
indemnifying party in writing thereof, but the omission so to notify the
indemnifying party shall not relieve it from any liability which it may have
to
such indemnified party other than under this Section 7(c) and shall only relieve
it from any liability which it may have to such indemnified party under this
Section 7(c) if and to the extent the indemnifying party is prejudiced by such
omission. In case any such action shall be brought against any indemnified
party
and it shall notify the indemnifying party of the commencement thereof, the
indemnifying party shall be entitled to participate in and, to the extent it
shall wish, to assume and undertake the defense thereof with counsel
satisfactory to such indemnified party, and, after notice from the indemnifying
party to such indemnified party of its election so to assume and undertake
the
defense thereof, the indemnifying party shall not be liable to such indemnified
party under this Section 7(c) for any legal expenses subsequently incurred
by
such indemnified party in connection with the defense thereof other than
reasonable costs of investigation and of liaison with counsel so selected,
provided, however, that, if the defendants in any such action include both
the
indemnified party and the indemnifying party and the indemnified party shall
have reasonably concluded that there may be reasonable defenses available to
it
which are different from or additional to those available to the indemnifying
party or if the interests of the indemnified party reasonably may be deemed
to
conflict with the interests of the indemnifying party, the indemnified parties
shall have the right to select one separate counsel and to assume such legal
defenses and otherwise to participate in the defense of such action, with the
reasonable expenses and fees of such separate counsel and other expenses related
to such participation to be reimbursed by the indemnifying party as incurred.
(d)
In
order to provide for just and equitable contribution in the event of joint
liability under the Act in any case in which either (i) the Seller, or any
controlling person of the Seller, makes a claim for indemnification pursuant
to
this Section 7 but it is judicially determined (by the entry of a final judgment
or decree by a court of competent jurisdiction and the expiration of time to
appeal or the denial of the last right of appeal) that such indemnification
may
not be enforced in such case notwithstanding the fact that this Section 7
provides for indemnification in such case, or (ii) contribution under the Act
may be required on the part of the Seller or controlling person of the Seller
in
circumstances for which indemnification is provided under this Section 7; then,
and in each such case, the Company and the Seller will contribute to the
aggregate losses, claims, damages or liabilities to which they may be subject
(after contribution from others) in such proportion so that the Seller is
responsible only for the portion represented by the percentage that the public
offering price of its securities offered by the registration statement bears
to
the public offering price of all securities offered by such registration
statement, provided, however, that, in any such case, (A) the Seller will not
be
required to contribute any amount in excess of the public offering price of
all
such securities offered by it pursuant to such registration statement; and
(B)
no person or entity guilty of fraudulent misrepresentation (within the meaning
of Section 10(f) of the Act) will be entitled to contribution from any person
or
entity who was not guilty of such fraudulent misrepresentation.
7. Assignment
and Amendment.
Notwithstanding anything herein to the contrary:
(a) Registration
Rights.
The
registration rights of a Holder under this Agreement may be assigned to a party
who acquires Registrable Securities from a Holder (or a Holder's permitted
assigns) only if: (i) such Holder agrees in writing with the transferee or
assignee to assign such rights, and the Company is given written notice by
the
assigning party before, at or after the time of such assignment stating the
name
and address of the assignee and identifying the securities of the Company as
to
which the rights in question are being assigned; and (ii) the transferee or
assignee agrees in writing with the Company to be bounded by all of the terms
and conditions of this Agreement, including, without limitation, the provisions
of this Section.
(b) Amendment
of Rights.
Any
provision of this Agreement may be amended and the observance thereof may be
waived (either generally or in a particular instance and either retroactively
or
prospectively), only with the written consent of the Company and Investors
(and/or any of their permitted successors or assigns) holding shares
representing and/or exercisable into a majority of all the Registration
Securities. Any amendment or waiver effected in accordance with this subsection
8(b) shall be binding upon each Investor, each Holder, each permitted successor
or assignee of such Investor or Holder and the Company.
8. Miscellaneous.
(a) Notices.
All
notices or other communications given or made hereunder shall be in writing
and
shall be personally delivered or deemed delivered the first business day after
being telecopied (provided that a copy is delivered by first class mail) or
on
the third business day after being mailed by first class mail, to the party
to
receive the same at its address set forth below or to such other address as
either party shall hereafter give to the other by notice duly made under this
Section: (i) if to the Company, to VGTel, Inc. ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇. ▇▇▇▇▇▇▇, ▇▇▇▇▇,
▇▇▇▇▇
and
(ii)
if to the Subscriber, to the name, address and telecopier number set forth
on
the signature page hereto.
(b) Entire
Agreement; Assignment.
This
Agreement and the documents referred to herein represent the entire agreement
between the parties hereto with respect to the subject matter hereof and may
be
amended only by a writing executed by the parties pursuant to Section 8 hereof.
No right or obligation of either party shall be assigned by that party without
prior notice to and the written consent of the other party except as described
in Section 8 hereof.
(c) Execution.
This
Agreement may be executed by facsimile transmission, and in counterparts, each
of which will be deemed an original.
(d) Law
Governing this Agreement.
This
Agreement shall be governed by and construed in accordance with the laws of
the
State of Nevada without regard to principles of conflicts of laws. Any action
brought by either party against the other concerning the transactions
contemplated by this Agreement shall be brought exclusively in the state courts
of Nevada or in the federal courts located in the state of Nevada. The parties
and the Company agree to submit to the jurisdiction of such courts and waive
trial by jury. The prevailing party shall be entitled to recover from the other
party its reasonable attorney's fees and costs. In the event that any provision
of this Agreement or any other agreement delivered in connection herewith is
invalid or unenforceable under any applicable statute or rule of law, then
such
provision shall be deemed inoperative to the extent that it may conflict
therewith and shall be deemed modified to conform with such statute or rule
of
law. Any such provision which may prove invalid or unenforceable under any
law
shall not affect the validity or enforceability of any other provision of any
agreement.
(e) Adjustments
for Stock Splits, etc.
Wherever
in this Agreement there is a reference to a specific number of shares of Common
Stock of the Company of any class or series, then, upon the occurrence of any
subdivision, combination or stock dividend of such class or series of stock,
the
specific number of shares so referenced in this Agreement shall automatically
be
proportionally adjusted to reflect the effect on the outstanding shares of
such
class or series of stock by such subdivision, combination or stock
dividend.
[THIS
SPACE INTENTIONALLY LEFT BLANK]
IN
WITNESS WHEREOF, this Agreement has been duly executed by the parties hereto
as
of the date first written above.
VGTEL,
INC.
By:________________________________
▇▇▇
▇▇▇▇▇▇
President
and Chief Financial Officer
INVESTOR:
___________________________________
Signature
___________________________________
Print
Name
___________________________________
Address
___________________________________
Address
___________________________________
Telecopier
Number (must be provided)