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EXHIBIT 10.3
OFFSHORE SECURITIES SUBSCRIPTION AGREEMENT
This Offshore Securities Subscription Agreement is executed in
reliance upon the transaction exemption afforded by Regulation S ("Regulation
S") as promulgated by the Securities and Exchange Commission ("SEC"), under
the Securities Act of 1933, as amended ("1933 Act").
This Agreement has been executed by the undersigned in connection
with the private placement of shares of Common Stock of PONDER INDUSTRIES,
INC., a corporation organized under the laws of Delaware, United States of
America (hereinafter referred to as "Seller"). The undersigned ATLANTIC
HOLDINGS LIMITED (hereinafter referred to as the "Purchaser") hereby
represents and warrants to, and agrees with Seller, as follows:
1. AGREEMENT TO SUBSCRIBE
a. The undersigned hereby agrees to purchase 750,000 shares of
Common Stock of Seller (the "Shares").
b. FORM OF PAYMENT. Purchaser shall pay the agreed purchase
price by delivering a Promissory Note in the principal amount
of $456,000, payable on or before 60 days from the issue date
of the receipt of the Shares.
2. SUBSCRIBER REPRESENTATIONS; ACCESS TO INFORMATION; INDEPENDENT INVESTIGATION.
a. OFFSHORE TRANSACTION. Purchaser represents and warrants to
Seller as follows:
i. Purchaser is not a U.S. person as that term is
defined under Regulation S;
ii. At the time the buy order was originated, Purchaser
was outside the United States as of the date of the
execution and delivery of this Agreement;
iii. Purchaser is purchasing the Shares for its own
account and not on behalf of any U.S. person, and
the sale has not been pre-arranged with a purchaser
in the United States;
iv. Each distributor participating in the offering of
the securities, if any, has agreed in writing that
all offers and sales of the securities prior to the
expiration of a period commencing on the date of
the transaction and ending 40 days thereafter shall
only be made in compliance with the safe harbor
contained in Regulation S, pursuant to registration
of Shares under the Securities Act of 1933 or
pursuant to an exemption from registration;
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v. Purchaser represents and warrants and hereby agrees
that all offers and sales of the Shares prior to the
expiration of a period commencing on the date of the
transaction and ending 40 days thereafter shall only
be made in compliance with the safe harbor contained
in Regulation S, pursuant to registration of
securities under the Securities Act of 1933 or
pursuant to an exemption from registration, and all
offers and sales after the expiration of the 40-
day period shall be made only pursuant to such a
registration or to such exemption from registration.
vi. All offering documents received by Purchaser
include statements to the effect that the Shares
have not been registered under the Securities Act
of 1933 and may not be offered or sold in the
United States or to U.S. Persons during a period
commencing on the date of the transaction and
ending 40 days thereafter unless the Shares are
registered under the Securities Act of 1933 or an
exemption from the registration requirements is
available.
vii. Purchaser understands that the Shares are being
offered and sold to it in reliance on specific
exemptions from the registration requirements of
Federal and State securities laws and that the Seller
is relying upon the truth and accuracy of the
representations, warranties, agreements,
acknowledgments and understandings of Purchaser set
forth herein in order to determine the applicability
of such exemptions and the suitability of Purchaser
to acquire the Shares.
viii. Purchaser represents and warrants that the subject
purchase of Shares by Purchaser is not a
transaction (or any element of a series of
transactions) that is part of any plan or scheme to
evade the registration provisions of the 1933 Act.
b. CURRENT PUBLIC INFORMATION. Purchaser acknowledges that
Purchaser has been furnished with or has acquired copies of
Seller's most recent Annual Report on the Form 10-K filed
with the Securities and Exchange Commission and any Forms
10-Q and 8-K filed thereafter (collectively the "SEC
Filings").
c. INDEPENDENT INVESTIGATION; ACCESS. Purchaser acknowledges
that Purchaser in making the decision to purchase the Shares
subscribed for, has relied upon independent investigations
made by it and its purchaser representatives, if any, have,
prior to any sale to it, been given access and the opportunity
to examine all material books and records of Seller, SEC
filings, all material contracts and documents relating to
this offering and an opportunity to ask questions of, and to
receive answers from Seller or any person acting on its
behalf concerning the terms and conditions of the offering.
Purchaser and its advisors, if any, have been furnished with
access to all publicly available materials relating to the
business, finances and operations of the Seller and materials
relating to the offer and sale of the Shares which have been
requested. Purchaser and its advisors, if
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any, have received complete and satisfactory answers to any
such inquiries.
d. NO GOVERNMENT RECOMMENDATION OR APPROVAL. Purchaser
understands that no federal or state agency has passed on or
made any recommendation or endorsement of the Shares.
3. ISSUER REPRESENTATIONS
a. REPORTING COMPANY STATUS. Seller is a reporting issuer as
defined by Rule 902 of Regulation S. Seller is in full
compliance, to the extent applicable, with all reporting
obligations under either Section 12(b), 12(g), or 15(d) of
the Securities Exchange Act of 1934, as amended (the
"Exchange Act"). Seller has registered its common stock
pursuant to Section 12 of the Exchange Act and the common
stock is quoted on NASDAQ.
b. OFFSHORE TRANSACTION.
i. Seller has not offered these securities to any person
in the United States or to any U.S. person as that
term is defined in Regulation S.
ii. At the time this buy order was originated, Seller
and/or its agent, reasonably believed Purchaser was
outside of the United States and was not a U.S.
person.
iii. Seller and/or its agents reasonably believe that the
transaction has not been pre-arranged with a
Purchaser in the United States.
iv. Seller represents and warrants that the subject
sale of Shares by Seller is not a transaction (or
element of a series of transactions) that is part
of any plan or scheme to evade the registration
provisions of the 1933 Act.
c. NO DIRECTED SELLING EFFORTS. In regard to this transaction,
Seller has not conducted any "directed selling efforts" as
that term is defined in Rule 902 of Regulation S, nor has
Seller conducted any general solicitation relating to the
offer and sale of the within securities to persons resident
within the United States or elsewhere.
4. EXEMPTION; RELIANCE ON REPRESENTATIONS. Purchaser understands that the
offer and sale of the Shares is not being registered under the 1933 Act.
Seller is relying on the rules governing offers and sales made outside the
United States pursuant to Regulation S. Rules 901 through 904 of Regulation S
govern this transaction. Purchaser agrees that it will only effect an offer
and sale of the shares if the Note remains unpaid in full. The transaction
restriction in connection with this offshore offer and sale restrict Purchaser
from offering and selling to U.S. persons or for the account or benefit of a
U.S. person for a 40-day period. Rule 903(c)(2) governs the 40-day transaction
restriction.
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5. TRANSFER AGENT INSTRUCTIONS. Seller's transfer agent will be instructed to
issue certificates representing Shares in the names of purchasers to be
specified. These certificates will be without a restrictive legend, but
Purchasers agree that such shares shall remain subject to the terms of this
Agreement.
6. CONDITIONS TO THE COMPANY'S OBLIGATIONS TO SELL. Purchaser understands that
Seller's obligation to sell the Stock is conditioned upon:
a. The receipt and acceptance by Seller of this Subscription
Agreement.
b. Delivery of the Promissory Note.
7. CONDITIONS TO PURCHASER'S OBLIGATION TO PURCHASE. Seller understands that
Purchaser's obligation to purchase the Stock in conditioned upon:
a. Acceptance by Purchaser of a satisfactory Subscription
Agreement for the transfer of Shares;
b. Delivery of certificates for Shares of Common Stock registered
in the name of designated individual purchasers.
8. GOVERNING LAW. This Agreement shall be governed by and interpreted in
accordance with the rulings of the laws of the State of Texas, U.S.A.
IN WITNESS WHEREOF, this Offshore Securities Subscription Agreement was duly
executed on the date first written below.
DATED this 22nd day of December, 1995.
PURCHASER:
ATLANTIC HOLDINGS LIMITED
an Ireland corporation
By:___________________________
ACCEPTED this 22nd day of
December, 1995
PONDER INDUSTRIES, INC.
By:_______________________
Larry Armstrong
President
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