STOCK SUBSCRIPTION AGREEMENT
TO: Console Marketing Inc., a Nevada state corporation
ADDRESS: Suite 202, 1166 Alberni Street
Vancouver, British Columbia CANADA V6E 3Z3
1. Share Subscription. The undersigned ("Subscriber") hereby agrees to
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purchase __________________________________ (__________) shares of common
stock, par value $_________, of Console Marketing Inc., a Nevada state
corporation ("Company").
2. Issuer Representations and Warranties. Issuer hereby represents and
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warrants to Subscriber as follows:
2.1 Organization, Good Standing and Qualification. The Issuer is a
corporation duly organized, validly existing and in good standing
under the laws of the State of Nevada.
2.2 Valid Issuance of Common Stock. The Common Stock, when issued and
delivered in accordance with the terms hereof for the consideration
expressed herein, will be validly issued and outstanding, fully paid
and non-assessable.
2.3 Reporting Issuer. The Issuer is subject to the reporting requirements
of the Securities Exchange Act of 1934 (the "34 Act").
2.4 No Market Conditioning. The Issuer undertook no activity for the
purpose of, or that could reasonably be expected to have the effect
of, conditioning the market in the United States for the Common Stock.
The Issuer did not place any advertisements in any publication
referring to the offering of the Common Stock for sale.
3. Subscriber Representations and Warranties. Subscriber hereby represents
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and warrants to Issuer as follows:
3.1 Authority of Subscriber. The Subscriber, if a corporation,
partnership, trust, or any other entity than a natural person,
represents that the subscription of the Common Stock referred to in
this Agreement does not contravene its charter or other
organizational documents or the laws of the country, state or
province of its incorporation, formation or organization or of any
other relevant jurisdiction. The Subscriber also represents that it
has the necessary authorizations to that effect.
3.2 Investment Experience. The Subscriber has such knowledge and
experience in financial and business matters that it is capable of
evaluating the merits and risks of the prospective investment in the
Common Stock, which are substantial and has in fact evaluated such
merits and risks in making its investment decision to purchase the
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Common Stock. The Subscriber, by virtue of its business and
financial expertise, has the capacity to protect its own interest in
connection with this transaction, or has consulted with tax,
financial, legal or business advisors as to the appropriateness of
an investment in the Common Stock. The Subscriber has not been
organized for the purpose of investing in the Common Stock, although
such investment is consistent with its purposes.
3.3 Accredited Investor. The Subscriber is (check applicable box):
(a)[_] a bank as defined in Section 3(a)(2) of the Securities Act
of 1933, as amended (the "Act"), or a savings and loan
association or other institution as defined in Section
3(a)(5)(A) of the Act acting in either an individual or
fiduciary capacity.
(b)[_] an insurance company as defined in Section 2(13) of the
Act.
(c)[_] an investment company registered under the Investment
Issuer Act of 1940 or a business development company as
defined in Section 2(a)(48) of that act.
(d)[_] a Small Business Investment Issuer licensed by the U.S.
Small Business Administration under Section 301(c) or (d) of
the Small Business Investment Act of 1958.
(e)[_] 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, if such plan has total assets in excess of
$5,000,000.
(f)[_] an employee benefit plan within the meaning of Title 1 of
the Employee Retirement Income Security Act of 1974, and the
investment decision is made by a plan fiduciary, as defined
in Section 3(21) of such Act, which is either a bank,
savings and loan association, insurance company or
registered investment advisor, or an employee benefit plan
having total assets in excess of $5,000,000 or, if a
self-directed plan, with investment decisions made solely by
persons who are Accredited Investors.
(g)[_] a private business development company as defined in
Section 202(a(22) of the investment Advisors Act of 1940.
(h)[_] an organization described in Section 501(c)(3) of the
Internal Revenue Code of 1986, a corporation, Massachusetts
or similar business trust, or a partnership not formed for
the specific purpose of acquiring the Common Stock, with
total assets in excess of $5,000,000.
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(i)[_] any trust with total assets in excess of $5,000,000 not
formed for the specific purpose of acquiring the Common
Stock, whose purchase is directed by a sophisticated person
who has such knowledge and experience in financial and
business matters that he is capable of evaluating the merits
and risks of the prospective investment.
(j)[_] a broker or dealer registered pursuant to Section 15 of
the Securities Exchange Act of 1934, as amended.
(k)[_] an individual (See Section 4.15(a) below)
(l)[_] none of the above (See Section 4.15(b) below)
3.4 (a) Individual Subscriber. If the Subscriber is an individual, then
the Subscriber (check an applicable box):
[_] is a director, executive officer or general partner of the
issuer of the Common Stock being offered or sold or a
director, executive officer or general partner of a general
partner of that issuer.
[_] has an individual net worth, or joint net worth with that
person's spouse, at the time of his purchase exceeding
$1,000,000.
[_] had an individual income in excess of $200,000 in each of
the two most recent years or joint income with that person's
spouse in excess of $300,000 in each of those years and has
a reasonable expectation of reaching the same income level
in the current year.
[_] none of the above.
3.5 No Distributor, Dealer or Underwriter. Subscriber is not a distributor
or dealer of the Common Stock. Subscriber is not taking the Common
Stock with the intent to make a distribution of the Common Stock, as
such terms are defined in the Act and the '34 Act. In any event, if
Subscriber is deemed to be the distributor of the Common Stock offered
hereby, Subscriber will act in accordance with applicable law.
3.6 Investment Intent. The Subscriber is acquiring the Common Stock for
its own account and for investment purposes and not for sale or with a
view to distribution of all or any part of such Common Stock and has
no present plans to enter into any contract, undertaking, agreement or
arrangement for such resale or distribution.
3.7 No Immediate Need for Liquidity. The Subscriber understands that the
Common Stock is a "restricted security" within the meaning of the Act,
and certificates representing the Common Stock are legended with
certain restrictions on the resale of the Common Stock and the Common
Stock may not be resold without a valid exemption from registration
under the Act, or until a registration statement is filed
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with respect thereto under the Act. There can be no assurance that
upon registration of the Common Stock pursuant to the Act, that a
market for the Common Stock will exist on an exchange or market or
quotation system. Accordingly, the Subscriber is aware that there are
legal and practical limits on the Subscriber's ability to sell or
dispose of the Common Stock, and, therefore that the Subscriber must
bear the economic risk of the investment for an indefinite period of
time. The Subscriber has adequate means of providing for the
Subscriber's current needs and possible personal contingencies and has
need for only limited liquidity of this investment. The Subscriber's
commitment to illiquid investments is reasonable in relation to the
Subscriber's net worth. The Subscriber is capable of bearing the high
degree of economic risks and burdens of this investment, including but
not limited to the possibility of complete loss of all its investment
capital and the lack of a liquid market, such that it may not be able
to liquidate readily the investment whenever desired or at the then
current asking price.
3.8 Exempt Subscription. The Subscriber understands that the Common Stock
is being offered and sold in reliance on specific exemptions from the
registration requirements of U.S. federal and state law and that the
representations, warranties, agreements, acknowledgments and
understandings set forth herein are being relied upon by the Issuer in
determining the applicability of such exemptions and the suitability
of the Subscriber to acquire such Common Stock.
3.9 Authority of Signatory. The Subscriber has full power and authority to
execute and deliver this Agreement and each other document included
herein as an exhibit to this Agreement for which signature is
required, and the person executing this Agreement on behalf of the
subscribing individual, partnership, trust, estate, corporation or
other entity executing this Agreement is a duly authorized signatory.
If the signatory of this Agreement on behalf of the Subscriber is not
the Subscriber or an authorized officer or partner of the Subscriber,
the signatory represents and warrants to the Issuer that the signatory
is a professional fiduciary of the Subscriber, acting solely in its
capacity as holder of such account, as a fiduciary, executor or
trustee.
3.10 Private Transaction. At no time was the Subscriber presented with or
solicited by any leaflet, public promotional meeting, circular,
newspaper or magazine article, radio or television advertisement or
any other form of general advertising.
3.11 Reliance on Own Advisors. The Subscriber has relied completely on the
advice of, or has consulted with, his own personal tax, investment,
legal or other advisors and has not relied on the Issuer or any of its
affiliates, officers, directors, attorneys, accountants or any
affiliates of any thereof and each other person, if any, who controls
any thereof, within the meaning of Section 15 of the Act, except to
the extent such advisors shall be deemed to be as such.
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4. Subscriber' Covenants and Acknowledgments. Subscribers makes the
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following covenants and acknowledgments:
4.1 Covenants of Subscriber. Subscriber shall not make any sale, transfer
or other disposition of the Common Stock in violation of the Act or
the '34 Act, or any other applicable securities laws, or the rules and
regulations of the U.S. Securities and Exchange commission or of any
securities authority of any jurisdiction in which the sale, transfer
or disposition of all or any portion of the Common Stock unless and
until (i) there is then in effect a Registration Statement under the
Act covering such proposed sale, transfer or disposition and such
disposition is made in accordance with such Registration Statement; or
(ii) the sale, transfer or disposition is made pursuant to a valid
exemption from the registration and prospectus delivery requirements
of applicable securities laws.
4.2 Acknowledgments of Subscriber. Subscriber acknowledges and understands
as follows:
4.2.1 Risks of Investment. The Subscriber recognizes that investment
in the Issuer involves certain risks, including the potential
loss of the Subscriber's investment herein, and the Subscriber
has taken full cognizance of and understands all of the risk
factors related to the purchase of the Common Stock.
4.2.2 No Government Approval. No federal or state agency has passed
upon the Common Stock or made any finding or determination as to
the fairness of this transaction.
4.2.3 Price. The Price of the Common Stock was determined by the
Issuer and bears no relationship to the Issuer's assets, book
value or results of operation.
4.2.4 No Registration. The Common Stock and any component thereof has
not been registered under the Act or any securities laws of any
other jurisdiction by reason of exemptions from the registration
requirements of the Act and such laws, and may not be sold,
pledged, assigned or otherwise disposed of in the absence of an
effective registration statement for the Common Stock and any
component thereof under the Act or unless an exemption from such
registration is available.
4.2.5 No Assurances of Registration. There can be no absolute
assurance that any registration statement will be filed with
respect to the Common Stock or the Common Stock underlying the
Common Stock, or if filed, that such registration statement will
become effective. Therefore, unless an exemption from the
registration requirements under applicable law is available, the
Subscriber may be required to bear the economic risk of the
Subscriber's investment for an indefinite period of time.
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4.2.6 Legends. The certificates representing the Common Stock shall
bear the following legend:
THIS SECURITY HAS NOT BEEN REGISTERED WITH THE U.S. SECURITIES
AND EXCHANGE COMMISSION UNDER THE U.S. SECURITIES ACT OF 1933,
AS AMENDED (THE "ACT") OR ANY OTHER SECURITIES AUTHORITIES. IT
IS BEING OFFERED PURSUANT TO AN EXEMPTION FROM REGISTRATION
UNDER REGULATIONS PROMULGATED UNDER THE ACT. IT MAY NOT BE SOLD
OR TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT OR AN EXEMPTION TO THE REGISTRATION REQUIREMENTS OF
THOSE SECURITIES LAWS.
The Issuer may in its sole discretion place a "Blue Sky" legend
on the certificates in accordance with U.S. State securities
laws or as required by applicable securities laws.
5. Regulation S. Issuer and Subscriber agree that Issuer, through its
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transfer agent, shall refuse to register any transfer or attempted transfer
of the Common Stock not made in accordance with the provisions of
Regulation S of the Securities Act of 1933 (the "Act"), pursuant to
registration under the Act, or pursuant to an available exemption from
registration. The Subscriber agrees to resell the Common Stock only in
accordance with the provisions of Regulation S of the Act, pursuant to
registration under the Act, or pursuant to an available exemption from
registration; and agrees not to engage in hedging transactions with regard
to the Common Stock unless in compliance with the Act.
6. Notices. Any notice required or permitted to be given under this
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Subscription shall be deemed to have been given when sent by registered or
certified mail, postage prepaid, addressed to the person to receive notice
at the last address available in the records of the Company.
7. Heirs and Successors Bound. Subscriber may not cancel, terminate or
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revoke this Subscription. Subscriber executes this Subscription on behalf
of Subscriber, Subscriber's spouse and the marital community composed of
them. This Subscription shall bind and inure to the benefit of Subscriber's
heirs, personal representatives and successors.
8. Assignments. Subscriber may not assign or delegate any right or duty
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under this Subscription without the written consent of the Company.
9. Applicable Law And Jurisdiction.
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9.1 This Agreement shall be governed by and construed in accordance with
the laws of the State of Washington, without regard to conflicts of
law principles.
In the event of any dispute, controversy, claim or difference that
should arise between the parties out of or relating to or in
connection with this Agreement or the breach
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thereof, the parties shall endeavor to settle such conflicts amicably
among themselves. Should they fail to do so, the matter in dispute
shall be settled by arbitration pursuant to the provisions of R.C.W.
7.04. Procedurally, the arbitration will be conducted in conformity
with Washington Mandatory Arbitration Rules 5.1 - 5.4. The parties
shall select a single arbitrator within ten (10) days of the receipt
of demand for arbitration. If the parties fail to appoint an
arbitrator within the ten (10) day period, any party may make
immediate application to the King County Superior Court for the
appointment of an arbitrator. The arbitration hearing shall take place
in Seattle, Washington, and shall commence within sixty (60) days of
the appointment of an arbitrator. Any party which is determined in
such arbitration to be the prevailing party shall be entitled to have
its attorneys' fees and costs paid by the non-prevailing party.
IN WITNESS WHEREOF, the undersigned Subscriber has executed this Share
Subscription Agreement this _____ day of _______________, 20_____.
SUBSCRIBER:
<Insert Company Name>
- ---------------------------------
<Insert Name / Title>
ACCEPTANCE:
The foregoing subscription agreement and the consideration reflected therein are
hereby accepted.
<Insert Company Name>
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<Insert Name / Title>
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