EXHIBIT
10.1
FORM OF SUBSCRIPTION
AGREEMENT
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200 Old Country
Road, Suite 610
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Mineola, New
York 11501-4241
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Attn: Arthur
Goldberg, CFO
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This Subscription Agreement (this “
Agreement ”) is being delivered to the purchaser
identified on the signature page to this Agreement (the “
Subscriber ”) in connection with its investment in
Clear Skies Solar, Inc., a Delaware corporation (the “
Company ”). The Company is conducting a
private placement (the “ Offering ”) of up to
ten million shares of its common stock, par value $.001 per share
(the “Shares”). For purposes of this
Agreement, the term “ Securities ” shall refer
to the Shares. The purchase price per Share shall be
fixed at $.09 (the “ Purchase Price
”). All funds received in the Offering prior to
the closing of the Offering (the “ Closing ”)
shall be held in escrow by the law firm of Morse, Zelnick, Rose
& Lander LLP (the “ Escrow Agent ”) and,
upon fulfillment of the other conditions precedent set forth
herein, shall be released from escrow and delivered to the Company
at which time the Shares subscribed for as further described below
shall be delivered, subject to Section 6 hereof, to
Subscriber. Notwithstanding anything to the contrary
contained herein, in the event the funds delivered by a Subscriber
are not evenly divisible by the Purchase Price, to the extent the
Company accepts such subscription, the Company may round down to
the nearest whole number the number of Shares to be sold to such
Subscriber and the Company shall be entitled to retain any
additional funds remaining due to such rounding.
1
.
SUBSCRIPTION AND PURCHASE PRICE
(a)
Subscription . Subject to the conditions set
forth in Section 2 hereof, the Subscriber hereby subscribes for and
agrees to purchase the number of Shares indicated on page 7 hereof
on the terms and conditions described herein.
(b)
Purchase of Shares . The Subscriber understands
and acknowledges that the Purchase Price to be remitted to the
Company in exchange for the Shares shall be set at $.09 per Share,
for an aggregate purchase price as set forth on page 7 hereof (the
“ Aggregate Purchase Price ”). The
Subscriber’s delivery of this Agreement to the Company shall
be accompanied by payment for the Shares subscribed for hereunder,
payable in United States dollars, by wire transfer of immediately
available funds delivered contemporaneously with the
Subscriber’s delivery of this Agreement to the Company in
accordance with the instructions provided on Exhibit A
. The Subscriber understands and agrees that, subject to
Section 2 and applicable laws, by executing this Agreement, it is
entering into a binding agreement.
2. ACCEPTANCE,
OFFERING TERM AND CLOSING PROCEDURES
(a)
Acceptance or Rejection . The obligation of the
Subscriber to purchase the Shares shall be irrevocable, and the
Subscriber shall be legally bound to purchase the Shares subject to
the terms set forth in this Agreement. The Subscriber
understands and agrees that the Company reserves the right to
reject this subscription for Shares in whole or part, at any time
prior to the Closing, for any reason, notwithstanding the
Subscriber’s prior receipt of notice of acceptance of the
Subscriber’s subscription. In the event of
rejection of this subscription by the Company in accordance with
this Section 2, or if the sale of the Shares is not consummated by
the Company for any reason, this Agreement and any other agreement
entered into between the Subscriber and the Company relating to
this subscription shall thereafter have no force or effect, and the
Company shall promptly return or cause to be returned to the
Subscriber the Purchase Price remitted to the Escrow Agent, without
interest thereon or deduction therefrom.
(b)
Offering Term . The subscription period for the
Offering will begin as of August 1, 2009 and will terminate upon
the earliest to occur of (a) September 15, 2009, unless extended by
the Company, (b) the Company’s acceptance of subscriptions
for not less than $700,000.00 of Shares and the receipt of payment
therefore, or (c) the Company’s decision to terminate the
Offering sooner.
(c)
Closing . The Closing shall take place at the
offices of the Company or such other place as determined by the
Company. The Closing shall take place on a Business Day promptly
following the satisfaction or waiver of the conditions set forth in
Section 6 below, as determined by the Company. “
Business Day ” shall mean from the hours of 9:00 a.m.
(Eastern Time) through 5:00 p.m. (Eastern Time) of a day other than
a Saturday, Sunday or other day on which commercial banks in New
York are authorized or required to be closed. The Securities
purchased by the Subscriber will be delivered by the Company
promptly following the Closing.
3. INVESTOR’S
REPRESENTATIONS AND WARRANTIES
The Subscriber hereby acknowledges, agrees with
and represents and warrants to the Company and its affiliates, as
follows:
(a) The
Subscriber has full power and authority to enter into this
Agreement, the execution and delivery of which has been duly
authorized, if applicable, and this Agreement constitutes a valid
and legally binding obligation of the Subscriber.
(b) The
Subscriber acknowledges its understanding that the Offering and
sale of the Securities is intended to be exempt from registration
under the Securities Act of 1933, as amended (the “
Securities Act ”), by virtue of Section 4(2) of the
Securities Act and the provisions of Regulation D promulgated
thereunder (“ Regulation D ”). In
furtherance thereof, the Subscriber represents and warrants to the
Company and its affiliates as follows:
(i) The
Subscriber realizes that the basis for the exemption from
registration may not be available if, notwithstanding the
Subscriber’s representations contained herein, the Subscriber
is merely acquiring the Securities for a fixed or determinable
period in the future, or for a market rise, or for sale if the
market does not rise. The Subscriber does not have any such
intention.
(ii) The
Subscriber realizes that the basis for exemption would not be
available if the Offering is part of a plan or scheme to evade
registration provisions of the Securities Act or any applicable
state or federal securities laws.
(iii) The
Subscriber is acquiring the Securities solely for the
Subscriber’s own beneficial account, for investment purposes,
and not with view towards, or resale in connection with, any
distribution of the Securities.
(iv) The
Subscriber has the financial ability to bear the economic risk of
the Subscriber’s investment, has adequate means for providing
for its current needs and contingencies, and has no need for
liquidity with respect to an investment in the Company.
(v) The
Subscriber and the Subscriber’s attorney, accountant,
purchaser representative and/or tax advisor, if any (collectively,
the “ Advisors ”) has such knowledge and
experience in financial and business matters as to be capable of
evaluating the merits and risks of a prospective investment in the
Securities. If other than an individual, the Subscriber
also represents it has not been organized solely for the purpose of
acquiring the Securities.
(vi) The
Subscriber (together with its Advisors, if any) has received all
documents requested by the Subscriber, if any, has carefully
reviewed them and understands the information contained therein,
prior to the execution of this Agreement.
(c) The
Subscriber is not relying on the Company or any of its employees,
agents, sub-agents or advisors with respect to economic
considerations involved in this investment. The
Subscriber has relied on the advice of, or has consulted with, only
its Advisors. Each Advisor, if any, is capable of evaluating the
merits and risks of an investment in the Securities, and each
Advisor, if any, has disclosed to the Subscriber in writing (a copy
of which is annexed to this Agreement) the specific details of any
and all past, present or future relationships, actual or
contemplated, between the Advisor and the Company or any affiliate
or sub-agent thereof.
(d) The
Subscriber has carefully considered the potential risks relating to
the Company and a purchase of the Securities, and fully understands
that the Securities are a speculative investment that involve a
high degree of risk of loss of the Subscriber’s entire
investment. Among other things, the Subscriber has carefully
considered each of the risks described under the heading
“Risk Factors” in the Company’s SEC Filings (as
defined in Section 4(c) below), which risk factors are incorporated
herein by reference.
(e) The
Subscriber represents, warrants and agrees that it will not sell or
otherwise transfer the Securities without registration under the
Securities Act or an exemption therefrom, and fully understands and
agrees that the Subscriber must bear the economic risk of its
purchase because, among other reasons, the Securities have not been
registered under the Securities Act or under the securities laws of
any state and, therefore, cannot be resold, pledged, assigned or
otherwise disposed of unless they are subsequently registered under
the Securities Act and under the applicable securities laws of such
states, or an exemption from such registration is available. In
particular, the Subscriber is aware that the Securities are
“restricted securities,” as such term is defined in
Rule 144 promulgated under the Securities Act (“ Rule
144 ”), and they may not be sold pursuant to Rule 144
unless all of the conditions of Rule 144 are met. The Subscriber
also understands that the Company is under no obligation to
register the Securities on behalf of the Subscriber or to assist
the Subscriber in complying with any exemption from registration
under the Securities Act or applicable state securities laws. The
Subscriber understands that any sales or transfers of the
Securities are further restricted by state securities laws and the
provisions of this Agreement.
(f) No
oral or written representations or warranties have been made to the
Subscriber by the Company or any of its officers, employees,
agents, sub-agents, affiliates, advisors or subsidiaries, other
than any representations of the Company contained herein, and in
subscribing for the Shares, the Subscriber is not relying upon any
representations other than those contained herein.
(g) The
Subscriber’s overall commitment to investments that are not
readily marketable is not disproportionate to the
Subscriber’s net worth, and an investment in the Securities
will not cause such overall commitment to become
excessive.
(h) The
Subscriber understands and agrees that the certificates for the
Securities shall bear substantially the following legend until (i)
such Securities shall have been registered under the Securities Act
and effectively disposed of in accordance with a registration
statement that has been declared effective or (ii) in the opinion
of counsel for the Company, such Securities may be sold without
registration under the Securities Act, as well as any applicable
“blue sky” or state securities laws:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE “SECURITIES ACT”), OR ANY APPLICABLE STATE
SECURITIES LAWS. SUCH SECURITIES HAVE BEEN ACQUIRED FOR
INVESTMENT PURPOSES AND MAY NOT BE OFFERED FOR SALE, SOLD,
DELIVERED AFTER SALE, TRANSFERRED, PLEDGED OR HYPOTHECATED IN THE
ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FILED BY THE ISSUER
WITH THE U.S. SECURITIES AND EXCHANGE COMMISSION COVERING SUCH
SECURITIES UNDER THE SECURITIES ACT OR AN OPINION OF COUNSEL
SATISFACTORY TO THE ISSUER THAT SUCH REGISTRATION IS NOT
REQUIRED.
(i) Neither
the Securities and Exchange Commission (the “ SEC
”) nor any state securities commission has approved the
Securities or passed upon or endorsed the merits of the Offering.
There is no government or other insurance covering any of the
Securities.
(j) The
Subscriber and its Advisors, if any, have had a reasonable
opportunity to ask questions of and receive answers from a person
or persons acting on behalf of the Company concerning the Offering
and the business, financial condition, results of operations and
prospects of the Company, and all such questions have been answered
to the full satisfaction of the Subscriber and its Advisors, if
any.
(k) The
Subscriber is unaware of, is in no way relying on, and did not
become aware of the Offering through or as a result of, any form of
general solicitation or general advertising including, without
limitation, any article, notice, advertisement or other
communication published in any newspaper, magazine or similar media
or broadcast over television or radio, or electronic mail over the
Internet, in connection with the Offering and is not subscribing
for Shares and did not become aware of the Offering through or as a
result of any seminar or meeting to which the Subscriber was
invited by, or any solicitation of a subscription by, a person not
previously known to the Subscriber in connection with investments
in securities generally.
(l) The
Subscriber has taken no action that would give rise to any claim by
any person for brokerage commissions, finders’ fees or the
like relating to this Agreement or the transactions contemplated
hereby.
(m) The
Subscriber is not relying on the Company or any of its employees,
agents, or advisors with respect to the legal, tax, economic and
related considerations of an investment in the Securities and the
Subscriber has relied on the advice of, or has consulted with, only
its own Advisors.
(n) The
Subscriber acknowledges that any estimates or forward-looking
statements or projections furnished by the Company to the
Subscriber, were prepared by management of the Company in good
faith, but that the attainment of any such projections, estimates
or forward-looking statements cannot be guaranteed by the Company
or its management and should not be relied upon.