SUBSCRIPTION AGREEMENT
=======================================================================
INSTRUCTIONS
1. COMPLETE AND SIGN AT PAGE 10 BOTH COPIES OF THIS
AGREEMENT.
1
SUBSCRIPTION AGREEMENT
Big City Bagels, Inc.
▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
A. Subscription. I (sometimes referred to herein as the "Investor") hereby
subscribe for and agree to purchase the dollar amount of shares of Class A
Preferred Stock , $.001 par value ("Preferred Stock"), of Big City Bagels, Inc.,
a New York corporation ("Company"), on the terms and conditions set forth herein
as indicated on the signature page hereto. The per share offering price is
$10.00 ("Share Price") and the number of shares of Preferred Stock being
purchased by me will be calculated by dividing the above dollar amount by the
per share offering price. ▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇ Capital Corp. ("PHD" or
"Placement Agent") is acting as the exclusive placement agent for this offering.
1. Description of Preferred Stock. The rights of each share of
Preferred Stock are as set forth in the Certificate of Amendment which is
included as Exhibit A in the Disclosure Package given to you simultaneously with
this Agreement ("Disclosure Package").
2. Purchase.
(a) I hereby tender (i) the purchase price by check or by wire
transfer to an escrow account ("Account") maintained by the Escrow Agent
designated by the Company and the Placement Agent, Continental Stock Transfer &
Trust Company, pursuant to written instructions provided to me by the Placement
Agent, and (ii) two executed copies of this Subscription Agreement, one copy of
the Purchaser Questionnaire and one copy of the NASD Questionnaire to the
Placement Agent at ▇▇▇▇▇▇, Holden & ▇▇▇▇▇▇▇▇▇ Capital Corp., ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇. ▇▇▇▇ ▇▇▇▇▇▇▇▇.
(b) The period of time in which the Company may accept
subscriptions in this offering will terminate on December 3, 1997, unless such
date is extended one or more times, without notice to the Investor, by PHD to a
date not later than December 17, 1997 ("Termination Date"). Prior to the earlier
of the closing, if any, with respect to my subscription, the rejection of my
subscription or the termination of this offering, my payment for the Preferred
Stock will be held by Escrow Agent in the Account subject to the terms and
conditions herein. If subscriptions for at least $3,000,000 of Preferred Stock
are not received and accepted by the Company by the Termination Date, or if the
Company does not obtain the approval of The Nasdaq Stock Market, Inc. for
listing of the Shares of Common Stock issuable upon conversion of at least
$1,100,000 stated value of the Preferred Stock ("Nasdaq Approval") and hold a
closing with respect to this offering of at least $1,100,000 stated value of
Preferred Stock and the Investor is included in that closing by December 31,
1997, unless such date is extended one or more times, without notice to the
Investor, by mutual consent of the Company and PHD to a date not later than
January 30, 1998, my payment will be returned to me without interest or
deduction. Upon the earlier of a closing for my subscription or the rejection of
my subscription, I will be notified promptly by the Company as to whether my
subscription has been accepted.
2
3. Acceptance or Rejection of Subscription.
(a) The Company and PHD have the right to reject this
subscription for the Preferred Stock, in whole or in part for any reason and at
any time prior to a Closing (as defined in Section 4 hereof), notwithstanding
prior receipt by me of notice of acceptance of my subscription.
(b) In the event of the rejection of this subscription, my
subscription payment will be promptly returned to me without interest or
deduction and this Subscription Agreement shall have no force or effect. In the
event my subscription is accepted and the offering is completed, the funds
specified above shall be released to the Company and the certificates
representing the Preferred Stock will be promptly delivered to me.
4. Closing. The closing of this offering ("Closing") may occur at any
time, as determined jointly by the Company and PHD, either prior to, on or after
the Termination Date, if subscriptions have been accepted by the Company for
Preferred Stock aggregating at least $3,000,000 by the Termination Date, and
Nasdaq Approval has been obtained. By mutual consent of the Company and PHD, the
Closing may be held (and this offering thereupon concluded) with respect to an
amount of stated value of Preferred Stock less than $3,000,000, but not less
than $1,100,000 stated value. The Preferred Stock subscribed for herein shall
not be deemed issued to or owned by me until two copies of this Subscription
Agreement have been executed by me and countersigned by the Company and a
Closing with respect to such Preferred Stock has occurred.
5. Issuance of Securities. At each Closing, the Company will deliver
the certificates representing the Preferred Stock to me or my agent for deposit
into my personal securities account at PHD or for delivery to me. The
certificates representing the Preferred Stock and the common stock, $.001 par
value, of the Company ("Common Stock") into which the Preferred Stock is
convertible shall be legended as follows:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
("ACT") OR APPLICABLE STATE SECURITIES LAWS AND MAY NOT BE
SOLD, PLEDGED, OR OTHERWISE TRANSFERRED WITHOUT AN EFFECTIVE
REGISTRATION STATEMENT WITH RESPECT THERETO UNDER THE ACT OR
PURSUANT TO AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF
SAID ACT AND COMPLIANCE WITHIN ANY APPLICABLE STATE SECURITIES
LAW, OR UNLESS THE COMPANY RECEIVES AN OPINION OF COUNSEL,
SATISFACTORY TO THE COMPANY AND ITS COUNSEL THAT SUCH
REGISTRATION IS NOT REQUIRED.
After the Registration Statement, referenced in Section 6
hereinbelow, is declared effective by the Securities and Exchange Commission,
the Investor may deliver to the Company the certificate representing the Common
Stock of the Company issued to such Investor upon conversion of the Preferred
Stock and the Company will, within three days after receipt by the Company of
the foregoing, issue a new certificate representing and in exchange for the
aforementioned certificate, which new certificate shall be legended as follows:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED.
3
THE SECURITIES MAY BE SOLD PURSUANT TO THE REGISTRATION
STATEMENT PROVIDED THAT (i) THE REGISTRATION STATEMENT IS
CURRENT AND EFFECTIVE, (ii) THE HOLDER COMPLIES WITH THE
PROSPECTUS DELIVERY REQUIREMENTS UNDER THE SECURITIES ACT OF
1933, AS AMENDED, AND (iii) THE SALE IS IN COMPLIANCE WITH THE
PLAN OF DISTRIBUTION SET FORTH IN THE PROSPECTUS.
6. Registration Rights.
(a) The Company agrees with the Investor and PHD to register
under a registration statement ("Registration Statement") filed pursuant to the
Securities Act of 1933, as amended ("Securities Act") and such state "Blue Sky"
laws of those states as are reasonably selected by the Investor, the shares of
Common Stock into which the Preferred Stock may be converted and the warrants
and the shares of Common Stock underlying the warrants to be issued to PHD in
connection with this sale of securities by the Company (collectively, the
"Registrable Securities"), and to obtain the approval of the Corporate Financing
Department of NASD Regulation, Inc. ("NASD CFD Approval") for the offering
contemplated by the Registration Statement. The Company agrees to file the
Registration Statement on or before the 30-day anniversary of the Closing of the
Offering. The Company agrees to use its best efforts to have the Registration
Statement declared effective and obtain NASD CFD Approval with 60 days from the
Closing and undertakes to have the Registration Statement declared effective and
obtain NASD CFD Approval within 120 days from the Closing. If the Registration
Statement is not declared effective and NASD CFD Approval is not obtained by the
close of business on the 120th day following the Closing as provided in the
Certificate of Amendment, the conversion rate will be lowered. The Company shall
bear all the expenses and pay all the fees it incurs in connection with the
preparation, filing and modification or amendment of the Registration Statement.
The Company shall keep the Registration Statement effective and current until
all the securities registered thereunder are sold or until all such securities
may be sold by the holders thereof under Rule 144 without volume limitations.
Notwithstanding the foregoing, during any consecutive 365-day period, the
Company may suspend the availability of the Registration Statement for no more
than two periods of up to 20 consecutive days and for no more than an aggregate
of 40 days during any 365-day period, if the Company's Board of Directors
determines, based upon the opinion of legal counsel, that there is valid purpose
for such suspension.
To the extent permitted by law, the Company will indemnify and
hold harmless each holder of the Registrable Securities ("Holder"), the officers
and directors of each Holder and each person, if any, who controls such Holder
within the meaning of the Securities Act or Securities Exchange Act of 1934, as
amended ("Exchange Act") against any losses, claims, damages, or liabilities to
which they may become subject under the Securities Act, the Exchange Act or any
state securities law or regulation (including all reasonable attorneys' fees and
other expenses reasonably incurred in investigating, preparing or defending
against any claim whatsoever incurred by the indemnified party in any action or
proceeding between the indemnitor and indemnified party or between the
indemnified party and any third party or otherwise) to which any of them may
become subject under the Securities Act, the Exchange Act or any other statute
or common law or otherwise under the laws of foreign countries, arising from
such registration statement or based upon any untrue statement or alleged untrue
statement of a material fact contained in (i) any preliminary prospectus, the
registration statement or prospectus (as from time to time each may be amended
and supplemented); (ii) in any post-effective amendment or amendments or any new
registration statement and prospectus in which it included the Registrable
Securities; or (iii) any application or other document or written communication
(collectively called "application") executed
4
by the Company or based upon written information furnished by the Company in any
jurisdiction in order to qualify the Registrable Securities under the securities
laws thereof or filed with the Securities and Exchange Commission, any state
securities commission or agency, Nasdaq or any securities exchange; or the
omission or alleged omission therefrom of a material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, unless such statement
or omission is made in reliance upon, and in strict conformity with, written
information furnished to the Company with respect to such Holder expressly for
use in any preliminary prospectus, such registration statement or prospectus, or
any amendment or supplement thereof, or in any application, as the case may be.
The Company agrees promptly to notify the Holder of the Registrable Securities
of the commencement of any litigation or proceedings against the Company or any
of its officers, directors or controlling persons in connection with the issue
and sale or resale of the Registrable Securities or in connection with any such
registration statement or prospectus.
7. Investor Agreements Representations and Warranties. I acknowledge,
represent and warrant to, and agree with, the Company and the Placement Agent as
follows:
(a) I am aware that my investment in the Company involves a
high degree of risk, and I carefully have read and fully understand the
Company's Annual Report on Form 10-KSB for the fiscal year ended December 31,
1996, the Company's Quarterly Report on Form 10-QSB for the quarter ended
September 30, 1997, the Company's Proxy Statement dated June 4, 1997 and the
Company's Prospectus dated July 9, 1997 (together with the three supplements
thereto dated September 26, 1997, October 21, 1997 and November 6, 1997), which
are included as Exhibits B, C, D and E, respectively, in the Disclosure Package.
(b) I acknowledge and am aware that there is no assurance as
to the future performance of the Company.
(c) I acknowledge that notwithstanding the Company's
commitment herein, there can be no assurance that the Company will file any
Registration Statement for the securities I am purchasing, that such
Registration Statement, if filed, will be declared effective or, if declared
effective, that the Company will be able to keep it effective until I sell the
Common Stock registered thereon.
(d) I am purchasing the Preferred Stock for my own account for
investment and not with view to or for sale in connection with the distribution
of the Preferred Stock, nor with any present intention of selling or otherwise
disposing of all or any part of the Preferred Stock. I understand that there may
not be any market for the Preferred Stock. I agree that (1) the purchase of the
Preferred Stock is a long-term investment, (2) I may have to bear the economic
risk of investment for an indefinite period of time because neither the
Preferred Stock nor the Common Stock underlying the Preferred Stock have been
registered under the Securities Act and, notwithstanding the Company's
commitment herein, may not be registered and, cannot be resold, pledged,
assigned, or otherwise disposed of unless they are subsequently registered under
said Securities Act and under applicable securities laws of certain states or an
exemption from such registration is available. I understand that the Company is
under no obligation to register the Preferred Stock and, except as set forth
herein, the Company is under no obligation to register the Common Stock
underlying the Preferred Stock on my behalf or to assist me in complying with
any exemption from such registration under the Securities Act or any state
securities laws. I hereby authorize the Company to place legends denoting the
restrictions on the Preferred Stock and the Common Stock to be issued hereunder
or conversion of the Preferred Stock, as the case may be.
5
(e) I recognize that the Preferred Stock, as an investment,
involves a high degree of risk including, but not limited to, the risk of
economic losses from operations of the Company and the total loss of my
investment. I believe that the investment in the Preferred Stock is suitable for
me based upon my investment objectives and financial needs, and I have adequate
means for providing for my current financial needs and contingencies and have no
need for liquidity with respect to my investment in the Company.
(f) I have been given access to full and complete information
regarding the Company and have utilized such access to my satisfaction for the
purpose of obtaining information in addition to, or verifying information
included in, the Disclosure Package, and I have either met with or been given
reasonable opportunity to meet with officers of the Company for the purpose of
asking questions of, and receiving answers from, such officers concerning the
terms and conditions of the offering of the Preferred Stock and the business and
operations of the Company and to obtain any additional information, to the
extent reasonably available. I have received all information and material
regarding the Company that I have requested.
(g) I have such knowledge and experience in financial and
business matters as to be capable of evaluating the merits and risks of an
investment in the Preferred Stock and have obtained, in my judgment, sufficient
information from the Company to evaluate the merits and risks of an investment
in the Company. I have not utilized any person as my purchaser representative as
defined in Regulation D promulgated by the Securities and Exchange Commission
pursuant to the Securities Act in connection with evaluating such merits and
risks.
(h) I have relied solely upon my own investigation in making a
decision to invest in the Company.
(i) I have received no representation or warranty from the
Company or the Placement Agent or any of their respective officers, directors,
employees or agents in respect of my investment in the Company and I have
received no information (written or otherwise) from them relating to the Company
or its business other than as set forth herein and in the Disclosure Package. I
am not participating in the offer as a result of or subsequent to: (I) any
advertisement, article, notice or other communication published in any
newspaper, magazine or similar media or broadcast over television or radio or
(ii) any seminar or meeting whose attendees have been invited by any general
solicitation or general advertising.
(j) I have had full opportunity to ask questions and to
receive satisfactory answers concerning the offering and other matters
pertaining to my investment and all such questions have been answered to my full
satisfaction. In addition, as required by Section 517.061(11)(a)(3), Florida
Statutes and by Rule 3-500.05(a) thereunder, if I am a Florida resident I may
have, at the offices of the Company, at any reasonable hour, after reasonable
notice, access to the materials set forth in the Rule which the Company can
obtain without unreasonable effort or expense.
(k) I have been provided an opportunity to obtain any
additional information concerning the offering and the Company and all other
information to the extent the Company possesses such information or can acquire
it without unreasonable effort or expense.
(l) I am an "accredited investor" as defined in Section 2(15)
of the Act and in Rule 501 promulgated thereunder.
6
(m) I understand that (i) the Preferred Stock and the
underlying securities have not been registered under the Securities Act, or the
securities laws of certain states in reliance on specific exemptions from
registration, (ii) no securities administrator of any state or the federal
government has recommended or endorsed this offering or made any finding or
determination relating to the fairness of an investment in the Company and (iii)
the Company is relying on my representations and agreements for the purpose of
determining whether this transaction meets the requirements of the exemptions
afforded by the Securities Act and certain state securities laws.
(n) I understand that historically the market price for, and
the trading volume of, the Company's Common Stock has been extremely volatile
and no representation or prediction has been given to me with respect to the
future price of the Company's Common Stock or the future liquidity of the market
for the Common Stock. I have been advised that as of November 7, 1997,
approximately 76% of the public float of the Common Stock is held by Depository
Trust Co. for ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ Clearing Corp., which is the clearing broker for,
among other firms, ▇▇▇▇▇▇ ▇▇▇▇▇▇ Securities, Inc. (the underwriter of the
Company's initial public offering in May 1996) and ▇.▇.
▇▇▇▇▇▇▇▇ Investments, Inc.
(o) I have been urged to seek independent advice from my
professional advisors relating to the suitability of an investment in the
Company in view of my overall financial needs and with respect to the legal and
tax implications of such investment.
(p) If the Investor is a corporation, company, trust, employee
benefit plan, individual retirement account, ▇▇▇▇▇ Plan, or other tax-exempt
entity, it is authorized and qualified to become an Investor in the Company and
the person signing this Subscription Agreement on behalf of such entity has been
duly authorized by such entity to do so.
(q) I hereby acknowledge and am aware that except for any
rescission rights that may be provided under applicable laws, I am not entitled
to cancel, terminate or revoke this subscription, and any agreements made in
connection herewith shall survive my death or disability.
(r) I hereby acknowledge that I have been told that (i) PHD is
being compensated as the Placement Agent and will receive a cash commission
equal to 10% of the aggregate purchase price of the Preferred Stock sold in the
offering to all Investors and will be issued five-year warrants to purchase
125,000 shares of Common Stock at an exercise price per share equal to the
average of the closing bid prices of the Common Stock on the five trading days
immediately preceding the Closing and warrants to purchase 75,000 shares of
Common Stock at an exercise price of $5.00 per share, and (ii) the warrants and
the Common Stock underlying the warrants issued to PHD is being registered under
the Securities Act on the same registration statement as the shares of Common
Stock which will be issuable on conversion of the Preferred Stock.
(s) I agree that prior to the conversion of all the Preferred
Stock purchased hereunder, I will not sell the Common Stock "short" on any
securities market on which the Common Stock is traded.
(t) The information I have furnished on the Purchaser
Questionnaire and NASD Questionnaire I have presented to the Company is true,
correct and complete.
7
8. Indemnification. I hereby agree to indemnify and hold harmless PHD
and the Company, each of their respective officers, directors, shareholders,
employees, agents, and attorneys against any and all losses, claims, demands,
liabilities, and expenses (including reasonable legal or other expenses,
including reasonable attorneys' fees and other expenses reasonably incurred in
investigating, preparing or defending against any claim whatsoever incurred by
the indemnified party in any action or proceeding between the indemnitor and
indemnified party or between the indemnified party and any third party or
otherwise) incurred by each such person in connection with defending or
investigating any such claims or liabilities, whether or not resulting in any
liability to such person, to which any such indemnified party may become subject
under the Securities Act, under any other statute, at common law or otherwise,
insofar as such losses, claims, demands, liabilities and expenses (a) arise out
of or are based upon any untrue statement or alleged untrue statement of a
material fact made by me and contained in this Subscription Agreement, or (b)
arise out of or are based upon any breach by me of any representation, warranty,
or agreement made by me contained herein. PHD is a third-party beneficiary of
this Section, and this Section may not be modified or amended without the prior
written agreement of PHD.
9. Severability. In the event any part of this Subscription Agreement
are found to be void, the remaining provisions of this Subscription Agreement
shall nevertheless be binding with the same effect as though the void parts were
deleted.
10. Choice of Law and Jurisdiction. This Subscription Agreement will be
deemed to have been made and delivered in New York City and will be governed as
to validity, interpretation, construction, effect and in all other respects by
the internal laws of the State of New York. The Company and the Investor each
hereby (i) agrees that any legal suit, action or proceeding arising out of or
relating to this Subscription Agreement shall be instituted exclusively in New
York State Supreme Court, County of New York, or in the United States District
Court for the Southern District of New York, (ii) waives any objection to the
venue of any such suit, action or proceeding and the right to assert that such
forum is not a convenient forum, proceeding, and (iii) irrevocably consents to
the jurisdiction of the New York State Supreme Court, County of New York, and
the United States District Court for the Southern District of New York in any
such suit, action or proceeding and the Company further agrees to accept and
acknowledge service or any and all process which may be served in any such suit,
action or proceeding in New York State Supreme Court, County of New York or in
the United States District Court for the Southern District of New York and
agrees that service of process upon it mailed by certified mail to its address
shall be deemed in every respect effective service of process upon it in any
suit, action or proceeding.
11. Counterparts. This Subscription Agreement may be executed in one or
more counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument. The execution of this
Subscription Agreement may be by actual or facsimile signature.
12. Benefit. This Subscription Agreement shall be binding upon and
inure to the benefit of the parties hereto (and PHD to the extent it is a
third-party beneficiary hereof) and their respective heirs, executors, personal
representatives, successors and assigns. PHD shall be deemed to be a third-party
beneficiary with respect to any sections hereof which so state or which
otherwise indicate that PHD would be entitled to rely on the representations,
warranties or covenants made by me therein.
8
13. Notices and Addresses. All notices, offers, acceptance and any
other acts under this Subscription Agreement (except payment) shall be in
writing, and shall be sufficiently given if delivered to the addressees in
person, by Federal Express or similar courier delivery by facsimile delivery or,
if mailed, postage prepaid, by certified mail, return receipt requested, as
follows:
Investor: At the address designated on the signature
page of this Subscription Agreement.
The Company: Big City Bagels, Inc.
▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention:
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Placement Agent: ▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇ Capital Corp.
▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
in any case,
with a copy to: ▇▇▇▇▇▇▇▇ Mollen & ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, Esq.
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
or to such other address as any of them, by notice to the others may designate
from time to time. The transmission confirmation receipt from the sender's
facsimile machine shall be conclusive evidence of successful facsimile deliver.
Time shall be counted to, or from, as the case may be, the delivery in person or
by mailing.
14. Oral Evidence. This Subscription Agreement constitutes the entire
agreement between the parties with respect to the subject matter hereof and
supersedes all prior oral and written agreements between the parties hereto with
respect to the subject matter hereof. This Subscription Agreement may not be
changed, waived, discharged, or terminated orally but, rather, only by a
statement in writing signed by the party or parties against which enforcement or
the change, waiver, discharge or termination is sought.
15. Section Headings. Section headings herein have been inserted for
reference only and shall not be deemed to limit or otherwise affect, in any
matter, or be deemed to interpret in whole or in part, any of the terms or
provisions of this Subscription Agreement.
16. Survival of Representations, Warranties and Agreements. The
representations, warranties and agreements contained herein shall survive the
delivery of, and the payment for, the Preferred Stock.
17. Acceptance of Subscription. The Company may accept this
Subscription Agreement at any time for all or any portion of the Preferred Stock
subscribed for by executing a copy hereof as provided and notifying me within a
reasonable time thereafter.
9
RESIDENTS OF ALL STATES: THE UNITS OFFERED HEREBY HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT, AS AMENDED, OR THE SECURITIES LAWS OF ANY
STATE AND ARE BEING OFFERED AND SOLD IN RELIANCE ON EXEMPTIONS FROM THE
REGISTRATION REQUIREMENTS OF SAID ACT AND SUCH LAWS. THE UNITS ARE SUBJECT TO
RESTRICTION ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD
EXCEPT AS PERMITTED UNDER SAID ACT AND SUCH LAWS PURSUANT TO REGISTRATION OR
EXEMPTION THEREFROM. INVESTORS SHOULD BE AWARE THAT THEY WILL BE REQUIRED TO
BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME.
THE UNITS HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE
COMMISSION, ANY STATE SECURITIES COMMISSION OR OTHER REGULATORY AUTHORITY, NOR
HAVE ANY OF THE FOREGOING AUTHORITIES PASSED UPON OR ENDORSED THE MERITS OF THE
OFFERING OR THE ACCURACY OR ADEQUACY OF THIS CONFIDENTIAL INVESTMENT SUMMARY.
ANY REPRESENTATION TO THE CONTRARY IS UNLAWFUL.
FOR FLORIDA RESIDENTS: THE SECURITIES OFFERED HEREBY HAVE NOT BEEN
REGISTERED UNDER THE FLORIDA SECURITIES AND INVESTOR PROTECTION ACT ("FLORIDA
SECURITIES ACT") , AND THEY THEREFORE HAVE THE STATUS OF SECURITIES ACQUIRED IN
AN EXEMPT TRANSACTION UNDER SECTION 517.061 OF THE FLORIDA SECURITIES ACT. EACH
OFFEREE WHO IS A FLORIDA RESIDENT SHOULD BE AWARE THAT SECTION 517.061(11)(a)(5)
OF THE FLORIDA SECURITIES ACT PROVIDES THAT WHEN SALES ARE MADE TO FIVE OR MORE
PERSONS IN FLORIDA, ANY SALE MADE IN FLORIDA IS VOIDABLE BY THE PURCHASER WITHIN
THREE DAYS AFTER THE FIRST TENDER OF CONSIDERATION IS MADE BY SUCH PURCHASER TO
THE COMPANY, AN AGENT OF THE COMPANY OR AN ESCROW AGREEMENT OR WITHIN THREE DAYS
AFTER THE AVAILABILITY OF THAT PRIVILEGE IS COMMUNICATED TO SUCH PURCHASER,
WHICH EVER OCCURS LATER.
THE AVAILABILITY OF THE PRIVILEGE TO VOID SALES PURSUANT TO SECTION
517.061(11)(a)(5) IS HEREBY COMMUNICATED TO EACH FLORIDA OFFEREE.
10
Manner in Which Title is to be Held. (check one)
____ Individual Ownership
____ Community Property
____ Joint Tenant with Right of Survivorship (both parties
must sign)
____ Partnership
____ Tenants in common
____ Corporation
____ Trust
____ Other (please indicate)
Dollar amount subscribed for (@ $10 per share): $________________
INDIVIDUAL INVESTORS ENTITY INVESTORS
------------------------ --------------------------
Signature (Individual) Name of Entity, if any
By:
-----------------------
Signature
---------------------------------------- Its
Signature (all record holders should sign) Title
------------------------------------- --------------------------
Name(s) Typed or Printed Name Typed or Printed
Address to Which Correspondence Address to Which Correspondence
Should be Directed Should be Directed
-------------------------------------- ----------------------------------
-------------------------------------- ----------------------------------
Social Security Number Tax Identification
----------------------- -----------------------------
The foregoing subscription is accepted and the Company hereby agrees to be bound
by its terms.
Big City Bagels, Inc.
Dated: By:
---------------------------
▇▇▇▇ ▇▇▇▇▇▇▇, Chairman and
Chief Executive Officer
11