EMVELCO CORP. Subscription Agreement
1061
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Gentlemen:
You
have
informed the undersigned (the “Purchaser”) that Emvelco Corp., a Delaware
corporation, (the “Company”) wishes to raise a minimum of Fifty Thousand Dollars
($50,000) and a maximum of Two Hundred Thousand Dollars ($200,000) from various
persons by selling up to 200,000 shares of the Company’s Common Stock, $0.001
par value (the “Shares”), at a price of One Dollar ($1.00) per Share. Each
Offering Unit will be issued with two (2) times 200,000 convertible Warrants.
Specifically, 200,000 of the Warrants are convertible upon exercise to one
(1)
Common Share of stock at $1.50 per share for a term of two (2) years. The other
200,000 of the Warrants are convertible upon exercise to one (1) Common Share
of
stock at $2.00 per share for a term of four (4) years. Notwithstanding the
foregoing, however, the Warrants may be converted to Common Shares only if
EMVELCO issues Twenty-Five Million (25,000,000) or more of its Common Stock
so
that there are at least Thirty Million (30,000,000) authorized Shares at the
time of any conversion term.
I
have
received, read, and understand the Limited Offering Memorandum dated
February 20, 2008 (the “Memorandum”). I further understand that my rights
and responsibilities as a Purchaser will be governed by the terms and conditions
of this Subscription Agreement, the Memorandum and the Shares (the “Share
Documents”). I understand that you will rely on the following information to
confirm that I am an “Accredited Investor”, as defined in Regulation D
promulgated under the Securities Act of 1933, as amended (the “Securities Act”),
or one of 35 Non-Accredited Investors that will be allowed to purchase Shares
in
this Offering (subject to Company approval), and that I am qualified to be
a
Purchaser.
This
Subscription Agreement is one of a number of such subscriptions for Shares.
By
signing this Subscription Agreement, I offer to purchase and subscribe from
the
Company the number of Shares set forth below on the terms specified herein.
The
Company reserves the right, in its complete discretion, to reject any
subscription offer or to reduce the number of Shares allotted to me. If this
offer is accepted, the Company will execute a copy of this Subscription
Agreement and return it to me. I understand that commencing on the date of
this
Memorandum all funds received by the Company in full payment of subscriptions
for Shares will be deposited in an escrow account. The Company has set a minimum
offering proceeds figure of $50,000 for this Offering. All proceeds from the
sale of Shares will be delivered directly to the Company and be available for
its use.
1.
Accredited
Investor.
I am an
Accredited Investor because I qualify within one of the following
categories:
Please
Check The Appropriate Category
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$1,000,000
Net Worth.
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A
natural
person whose individual net worth, or joint net worth with that person’s spouse,
at the time of his purchase exceeds $1,000,000.
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______________
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Purchaser’s
Initials
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$200,000/$300,000
Income.
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A
natural
person who had an individual income in excess of $200,000 (including
contributions to qualified employee benefit plans) or joint income with such
person’s spouse in excess of $300,000 per year in each of the two most recent
years and who reasonably expects to attain the same individual or joint levels
of income (including such contributions) in the current year.
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Director
or Officer of Issuer.
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Any
director or executive officer of the Company
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All
Equity Owners In Entity Are
Accredited.
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An
entity, (i.e. corporation, partnership, trust, ▇▇▇, etc.) in which all of the
equity owners are Accredited Investors as defined herein.
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Corporation.
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A
corporation not formed for the specific purpose of acquiring the Shares offered,
with total assets in excess of $5,000,000.
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Other
Accredited Investor.
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Any
natural person or entity which qualifies as an Accredited Investor pursuant
to
Rule 501(a) of Regulation D promulgated under the Act; specify basis for
qualification:
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One
of 35 Non-Accredited Investors that may be allowed to invest in the
offering
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2.
Representations
and Warranties.
I
represent and warrant to the Company that:
(a)
I (i)
have adequate means of providing for my current needs and possible contingencies
and I have no need for liquidity of my investment in the Shares, (ii) can bear
the economic risk of losing the entire amount of my investment in Shares, and
(iii) have such knowledge and experience that I am capable of evaluating the
relative risks and merits of this investment; (iv) the purchase of Shares is
consistent, in both nature and amount, with my overall investment program and
financial condition.
(a)
The
address set forth below is my true and correct residence, and I have no
intention of
becoming a resident of any other state or jurisdiction.
(b)
I
have
not utilized the services of a “Purchaser Representative” (as defined
in Regulation
D promulgated under the Securities Act) because I am a sophisticated,
experienced investor, capable of determining and understanding the risks
and
merits of this investment.
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Purchaser’s
Initials
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(d)
I
have received and read, and am familiar with the Share Documents, including
the
Memorandum and the forms of certificate for Shares. All documents, records
and
books pertaining to the Company and the Shares requested by me, including all
pertinent records of the Company, financial and otherwise, have been made
available or delivered to me.
(e)
I
have had the opportunity to ask questions of and receive answers from the
Company’s officers and representatives concerning the Company’s affairs
generally and the terms and conditions of my proposed investment in the
Shares.
(f)
I
understand the risks implicit in the business of the Company. Among other
things, I understand that there can be no assurance that the Company will be
successful in obtaining the funds necessary for its success. If only a fraction
of the maximum amount of the Offering is raised, the Company may not be able
to
expand as rapidly as anticipated, and proceeds from this Offering may not be
sufficient for the Company’s long term needs.
(g)
Other
than as set forth in the Memorandum, no person or entity has made any
representation or warranty whatsoever with respect to any matter or thing
concerning the Company and this Offering, and I am purchasing the Shares based
solely upon my own investigation and evaluation.
(h)
I
understand that no Shares have been registered under the Securities Act, nor
have they
been
registered pursuant to the provisions of the securities or other laws of
applicable jurisdictions.
(i)
The
Shares for which I subscribe are being acquired solely for my own account,
for
investment and are not being purchased with a view to or for their resale or
distribution. In order to induce the Company to sell Shares to me, the Company
will have no obligation to recognize the ownership, beneficial or otherwise,
of
the Shares by anyone but me.
(j)
I am
aware of the following:
| (i) |
The
Shares are a speculative investment which involves a high degree
of risk;
and
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| (ii) |
My
investment in the Shares is not readily transferable; it may not
be
possible for me to liquidate my
investment.
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| (iii) |
The
financial statements of the Company have merely been compiled, and
have
not been reviewed or audited.
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| (iv) |
There
are substantial restrictions on the transferability of the Shares
registered under the Securities Act;
and
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______________
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Purchaser’s
Initials
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| (v) |
No
federal or state agency has made any finding or determination as
to the
fairness of the Shares for public investment nor any recommendation
or
endorsement of the Shares;
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(k)
Except as set forth in the Memorandum, none of the following information has
ever been represented, guaranteed, or warranted to me expressly or by
implication, by any broker, the Company, or agents or employees of the
foregoing, or by any other person:
| (i) |
The
appropriate or exact length of time that I will be required to hold
the
Shares;
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| (ii) |
The
percentage of profit and/or amount or type of consideration, profit,
or
loss to be realized, if any, as a result of an investment in the
Shares;
or
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| (iii) |
That
the past performance or experience of the Company, or associates,
agents,
affiliates, or employees of the Company or any other person, will
in any
way indicate or predict economic results in connection with the purchase
of Shares;
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| (iv) |
The
amount of dividends or distributions that the Company will
make;
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(l)
I
have not distributed the Memorandum to anyone, no other person has used the
Memorandum, and I have made no copies of the Memorandum; and
(m)
I
hereby agree to indemnify and hold harmless the Company, its officers,
directors, and representatives from and against any and all liability, damage,
cost or expense, including reasonable attorneys fees, incurred on account of
or
arising out of:
| (i) |
Any
inaccuracy in the declarations, representations, and warranties set
forth
above;
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| (ii) |
The
disposition of any of the Shares by me which is contrary to the foregoing
declarations, representations, and warranties;
and
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| (iii) |
Any
action, suit or proceeding based upon (1) the claim that said
declarations, representations, or warranties were inaccurate or misleading
or otherwise cause for obtaining damages or redress from the Company;
or
(2) the disposition of any of the
Shares.
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(n)
By
entering into this Subscription Agreement, I acknowledge that the Company is
relying on the truth and accuracy of my representations.
The
foregoing representation and warranties are true and accurate as of the date
hereof, shall be true and accurate as of the date of the delivery of the funds
to the Company and shall survive such delivery. If, in any respect, such
representations and warranties are not true and accurate prior to delivery
of
the funds, I will give written notice of the fact to the Company, specifying
which representations and warranties are not true and accurate and the reasons
therefor.
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______________
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Purchaser’s
Initials
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3.
Transferability.
I
understand that I may sell or otherwise transfer my Shares only if registered
under the Securities Act or I provide the Company with an opinion of counsel
acceptable to the Company to the effect that such sale or other transfer
may be
made in absence of registration under the Securities Act. I have no right
to
cause the Company to register the Shares. Any certificates or other documents
representing my Shares will contain a restrictive legend reflecting this
restriction, and stop transfer instructions will apply to my
Shares.
4. Indemnification.
I
understand the meaning and legal consequences of the representations and
warranties contained in Paragraph 2 hereof, and I will indemnify and hold
harmless the Company, its officers, directors, and representatives involved
in
the offer or sale of the Shares to me, as well as each of the managers and
representatives, employees and agents and other controlling persons of each
of
them, from and against any and all loss, damage or liability due to or arising
out of a breach of any representation or warranty of mine contained in this
Subscription Agreement.
5.
Revocation.
I will
not cancel, terminate or revoke this Subscription Agreement or any agreement
made by me hereunder and this Subscription Agreement shall survive my death
or
disability.
6.
Termination
of Agreement.
If this
subscription is rejected by the Company, then this Subscription Agreement shall
be null and void and of no further force and effect, no party shall have any
rights against any other party hereunder, and the Company shall promptly return
to me the funds delivered with this Subscription Agreement.
7.
Miscellaneous.
| (a) |
This
Subscription Agreement shall be governed by and construed in accordance
with the
substantive law of the State of
California.
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| (b) |
This
Subscription Agreement constitutes the entire agreement between the
parties hereto with respect to the subject matter hereof and may
be
amended only in writing and executed by all
parties.
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8.
Ownership
Information.
Please
print here the total number of Shares to be purchased, and the exact name(s)
in
which the Shares will be registered.
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Total
Shares:
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Name(s):
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Single
Person
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Husband
and Wife, as community property
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Joint
Tenants (with right of survivorship)
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Tenants
in Common
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A
Married Person as separate property
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Corporation
or other organization
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A
Partnership
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Trust
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▇▇▇
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______________
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Purchaser’s
Initials
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Tax-Qualified
Retirement Plan
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(i)
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Trustee(s)/
Custodian
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(ii)
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Trust
Date
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(iii)
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Name
of Trust
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(iv)
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For
the Benefit of
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Other:
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(please
explain)
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Social
Security or Tax I.D.#:
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Residence
Address:
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Street
Address
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City
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State
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Zip
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Mailing
Address: (Complete only if different from residence)
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Street
Address (If P.O. Box, include address for surface delivery if different
than residence)
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City
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State
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Zip
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Phone
Numbers
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Home:
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(
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Business:
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(
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Facsimile:
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(
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______________
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Purchaser’s
Initials
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9.
Date
and Signatures.
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Dated |
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, | 2008. |
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Signatures
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Purchaser
Name (Print)
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(Each
co-owner or joint owner must sign - Names must be signed exactly as listed
under
“Purchaser Name”)
ACCEPTED:
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By:
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Dated:
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, | ▇▇▇▇ | ||
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▇▇▇▇▇
▇▇▇▇▇
President
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______________
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Purchaser’s
Initials
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Investor
Suitability Questionnaire
To:
Prospective purchasers of Shares of Common Stock (the “Shares”) offered by
EMVELCO CORP. (the “Company”).
The
Purpose of this Questionnaire is to solicit certain information regarding your
financial status to determine whether you are an “Accredited Investor,” as
defined under applicable federal and state securities laws, and otherwise meet
the suitability criteria established by the Company for purchasing Shares.
This
questionnaire is not an offer to sell securities.
Your
answers will be kept as confidential as possible. You agree, however, that
this
Questionnaire may be shown to such persons as the Company deems appropriate
to
determine your eligibility as an Accredited Investor or to ascertain your
general suitability for investing in the Shares.
Please
answer all questions completely and execute the signature
page
A.
Personal
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1.
Name:
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2.
Address of Principal Residence:
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County:
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3.
Residence Telephone:
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(
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4.
Where are you registered to vote?
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5.
Your driver’s license is issued by the following state:
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| 6. Other Residences or Contacts: Please identify any other state where you own a residence, are registered to vote, pay income taxes, hold a driver’s license or have any other contacts, and describe your connection with such state: |
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7.
Please send all correspondence to:
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(1)
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Residence
Address (as set forth in item A-2)
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(2)
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Business
Address (as set forth in item B-1)
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8.
Date of Birth:
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9.
Citizenship:
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10.
Social Security or Tax I.D. #:
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B.
Occupations and Income
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1.
Occupation:
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(a)
Business Address:
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(b)
Business Telephone Number:
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(
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2.
Gross income during each of the last two years
exceeded:
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(1)
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$25,000
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(2)
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$50,000
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(3)
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$100,000
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(4)
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$200,000
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3.
Joint gross income with spouse during each of the last two years
exceeded
$300,000
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(1)
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Yes
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(2)
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No
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4.
Estimated gross income during current year
exceeds:
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(1)
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$25,000
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(2)
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$50,000
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(3)
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$100,000
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(4)
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$200,000
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5.
Estimated joint gross income with spouse during current year exceeds
$300,000
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(1)
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Yes
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(2)
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No
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C.
Net Worth
1.
Current net worth or joint net worth with spouse (note that “net worth” includes
all of the assets owned by you and your spouse in excess of total liabilities,
including the fair market value, less any mortgage, of your principal
residence.)
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(1)
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$50,000-$100,000
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(2)
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$100,000-$250,000
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(3)
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$250,000-$500,000
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(4)
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$500,000-$750,000
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(5)
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$750,000-$1,000,000
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(6)
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over
$1,000,000
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2.
Current value of liquid assets (cash, freely marketable securities,
cash
surrender value of life insurance policies, and other items easily
convertible into cash) is sufficient to provide for current needs
and
possible personal contingencies:
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(1)
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Yes
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(2)
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No
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D.
Affiliation with the Company
Are
you a
director or executive officer of the Company?
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(1)
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Yes
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(2)
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No
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E.
Investment Percentage of Net Worth
If
you
expect to invest up to $200,000 in Shares, does your total purchase price exceed
10% of your net worth at the time of sale, or joint net worth with your
spouse.
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(1)
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Yes
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(2)
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No
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F.
Consistent Investment Strategy
Is
this
investment consistent with your overall investment strategy?
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(1)
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Yes
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(2)
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No
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G.
Prospective Investor’s Representations
The
information contained in this Questionnaire is true and complete, and the
undersigned understands that the Company and its counsel will rely on such
information for the purpose of complying with all applicable securities laws
as
discussed above. The undersigned agrees to notify the Company promptly of any
change in the foregoing information which may occur prior to any purchase by
the
undersigned of securities from the Company.
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Prospective
Investor:
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Date:
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,
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2008 | ||
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Signature
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Signature
(of joint purchase if purchase is to be made as joint tenants or
as
tenants in common)
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