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SUBSCRIPTION AGREEMENT

LLC Subscription Agreement

SUBSCRIPTION AGREEMENT | Document Parties: PARAGON CAPITAL LP | TIMBERJACK SPORTING SUPPLIES, INC You are currently viewing:
This LLC Subscription Agreement involves

PARAGON CAPITAL LP | TIMBERJACK SPORTING SUPPLIES, INC

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Title: SUBSCRIPTION AGREEMENT
Governing Law: Nevada     Date: 11/21/2008

SUBSCRIPTION AGREEMENT, Parties: paragon capital lp , timberjack sporting supplies  inc
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Exhibit 10.1

 

 

SUBSCRIPTION AGREEMENT

 

THIS SUBSCRIPTION AGREEMENT, dated as of September 15, 2008 (this “Agreement”), by and between PARAGON CAPITAL LP, a Delaware limited partnership (the “Purchaser”); and TIMBERJACK SPORTING SUPPLIES, INC., a Nevada corporation (“Company,” and together with the Purchaser, the “parties” or “Party”).

 

W I T N E S S E T H

 

WHEREAS, the Purchaser desires to subscribe and purchase a total of 375,500,000 shares (the “ Shares ”) of common stock of the Company, par value $0.001 per share (the “Common Stock”), which will represent approximately 90.01% of the Company’s issued and outstanding shares of the Common Stock of the Company upon the consummation of the transaction(s) contemplated by this Agreement pursuant to the terms and conditions set forth herein;

 

WHEREAS, the Shares shall be delivered to Purchaser in two (2) tranches, the first such tranche for a total of 75,500,000 shares to be delivered concurrent with the execution of this Subscription Agreement on the date as set forth in Section 1.2 below, (the “Tranche I Shares”) and the second tranche, for a total of 300,000,000 shares to be delivered subject to certain enumerated conditions as set forth in Section 3.7 below on such date as further specified in Section 1.2 below (the “Tranche II Shares,” and together with the Tranche I Closing Shares, the “Shares”);

 

WHEREAS, the Purchaser desires to buy the Shares pursuant on the terms and conditions set forth herein, and

 

NOW THEREFORE, in consideration of the promises and respective mutual agreements herein contained, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as to the following:

 

SALE AND PURCHASE OF THE SHARES

 

Sale of the Shares .  Subject to the terms and conditions set forth herein, on the basis of the representations, warranties and covenants herein contained, at the Closing(s) as described in Section 1.2 below, the Company hereby agrees to sell, assign, transfer and deliver the Shares to the Purchaser, and the Purchaser agrees to purchase the Shares from the Company.

 

The Closing(s) .  The purchase of the Shares shall take place at the office of the Company in San Dimas, California or such other place as the Purchaser and Company may mutually agree.

 

 The Tranche I Shares shall be delivered to Purchaser simultaneously with  the due execution and delivery of this Agreement and further subject to satisfactory payment at the direction of Company in the amount of $56,625.00 for the Tranche I Shares, on or about September 15, 2008, herein referred to as the “Tranche I Closing Date.”

 

(b)           The Tranche II Shares shall be delivered to Purchaser, if at all, on a date termed herein as the “Tranche II Closing Date,” and with the Tranche I Closing Date, the “Closings.” This date shall one (1) business day subsequent to the satisfaction of certain conditions and contingencies as specified in Section 3.7 below.  Until such time as the Tranche II Shares are paid for in full at the direction of the Company, the term or phrase “Direction of the Company” as used in this Agreement, shall mean the direction of the presently appointed Chief Executive Officer or in the case of his demise or incapacitation, his duly appointed successor subject to the terms and conditions as set forth in Sections 3.8 and 3.9.

 

 

1


 

Instruments of Conveyance and Transfer .  At the each of the respective Closings, Company shall deliver a certificate(s) representing the Shares to the Purchaser in the name of the Purchaser (“Certificate(s)”), as shall be effective to vest in the Purchaser all right, title and interest in and to all of the Shares.

 

Consideration and Payment for the Shares .  In consideration for the Shares, the Purchaser shall pay to the Company a total purchase price of $281,625 (the “ Purchase Price ”). The Purchase Price shall be placed into an escrow account and disbursed pursuant to an escrow agreement attached hereto as Exhibit A .

 

REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE COMPANY

 

The Company hereby represents, warrants and covenants to the Purchaser that, to the best of its Knowledge, the following.  “ Knowledge” means the actual knowledge of any officers or directors of the Company, or the Company after making appropriate inquiry of others in the organization having responsibility in the areas of the matters covered by this Agreement.

 

Due Organization .  The Company is a corporation duly formed, validly existing and in good standing under the laws of the state of its incorporation with full power and authority to own, lease, use, and operate its properties and to carry on its business as and where now owned, leased, used, operated and conducted. The Company is duly qualified to conduct its business in all states and jurisdictions which require the Company to be so qualified.The copy of the Articles of Incorporation and the Bylaws of the Company, which has previously been delivered to Purchaser, is a true, complete and correct copy of such document as in effect as of the date of this Agreement. Other than provided to the Purchaser, there have been no amendments, restatements or other changes to the Company’s Certificate of Incorporation or amendments, restatements or other changes made to the Company’s bylaws.

 

Subsidiaries . The Company has no subsidiaries.

 

Company Authority .  The Company has all requisite corporate power and authority to enter into and perform this Agreement and to consummate the transactions contemplated herein.

 

Due Authorization .  The execution, delivery and performance by the Company of this Agreement has been duly and validly authorized and no further consent or authorization of the Company, its Board of Directors or its stockholders is required.

 

Binding Agreement .  This Agreement constitutes, and upon execution and delivery thereof by the Company, will constitute, a valid and binding agreement of the Company, enforceable by and against the Parties in accordance with its terms, except as may be limited by applicable bankruptcy, insolvency or similar laws affecting creditor’s rights generally or the availability of equitable remedies.

 

No Violation of Corporate Documents or Agreements .  The execution and delivery of this Agreement by the Company and the performance by the Company of its obligations hereunder will not cause, constitute, or conflict with or result in (i) any breach or violation, or give rise to a right of termination, cancellation or acceleration of any obligation or to loss of a material benefit under, or to increased, additional, accelerated or guaranteed rights or entitlements of any person under any of the provisions of, or constitute a default under, any license, indenture, mortgage, charter, instrument, certificate of incorporation, bylaw, judgment, order, decision, writ, injunction, or decree or other agreement or instrument or proceeding to which the Company or stockholders are a party, or by which they may be bound, nor will any consents or authorizations of any party other than those hereto by required, (ii) an event that would cause the Company to be liable to any party, or (iii) an event that would result in the creation or imposition or any lien, charge or encumbrance on any asset of the Company or on the Shares to be acquired by the Purchaser.

 

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Authorized Capital, No Preemptive Rights, No Liens; Anti-Dilution .  As of the date hereof, the authorized capital of the Company is 980,000,000 shares of Common Stock, par value $0.001 per share, and 5,000,000 shares of Preferred Stock, par value $0.001 per share.  The issued and outstanding capital stock of the Company as of the date of this Agreement is 45,500,000 shares of Common Stock and no issued or outstanding shares of Preferred Stock.  All of the shares of capital stock are duly authorized, validly issued, fully paid and non-assessable.  No shares of capital stock of the Company are subject to preemptive rights or similar rights of the stockholders of the Company or any liens or encumbrances imposed through the actions or failure to act of the Company, or otherwise.  As of the date hereof, (i) there are no outstanding options, warrants, convertible securities, scrip, rights to subscribe for, puts, calls, rights of first refusal, tag-along agreements, nor any other agreements, understandings, claims or other commitments or rights of any character whatsoever relating to, or securities or rights convertible into or exchangeable for any shares of capital stock of the Company, or arrangements by which the Company is or may become bound to issue additional shares of capital stock of the Company, (ii) there are no agreements or arrangements under which the Company is obligated to register the sale of any of its securities under the Securities Act of 1933, as amended (the “Securities Act”), and (iii) there are no anti-dilution or price adjustment provisions contained in any security issued by the Company (or in the Company’s certificate of incorporation or bylaws or in any agreement providing rights to security holders) that will be triggered by the transactions contemplated by this Agreement. The Company has furnished to the Purchaser true and correct copies of the Company’s certificate of incorporation and bylaws in full force and effect and certified by the Secretary of the Company to such effect as of the Closing(s) Date.

 

Private Placement .  The Company is selling the Shares to the Purchaser without registration pursuant to the exemptions afforded the Company under Section 4(2) of the Securities Act and will take any and all actions to make such exemption available.   Upon the requisite time under Rule 144 of the Securities Act and at such that the Purchaser shall request any and all restrictive legends to be removed from the Certificate(s) evidencing the Shares which would prevent the sale thereof, and upon the delivery of an opinion of counsel acceptable to the Company and such other customary forms, the Company shall take any and all actions available to it to have such restrictive legends removed from such Certificate(s) in order that they may be traded by the Purchaser or sold in a privately negotiated sale.  The Company shall at no time place a “Stop Order” on the Shares.

 

No Governmental Action Required .  The execution and delivery by the Company of this Agreement does not and will not, and the consummation of the transactions contemplated hereby will not, require any action by or in respect of, or filing with, any governmental body, agency or governmental official.

 

Compliance with Applicable Law and Corporate Documents. To the best of its Knowledge (which shall mean the actual and constructive knowledge of the officer, directors, agents and representatives of the Company), the Company is in compliance with and conforms to all statutes, laws, ordinances, rules, regulations, orders, restrictions and all other legal requirements of any domestic or foreign government or any instrumentality thereof having jurisdiction over the conduct of its businesses or the ownership of its properties

 

Financial Statements .  (a) The Purchaser has received a copy of the reviewed financial statements of the Company for the quarter ended June 30, 2008 and an unaudited Balance Sheet as of the date of the Closing(s) or such other time as may be reasonably agreed to by the Company and the Purchaser (“ Financial Statements ”).  The Financial Statements fairly present the financial condition of the Company at the dates indicated and its results of their operations and cash flows for the periods then ended and, except as indicated therein, reflect all claims against, debts and liabilities of the Company, fixed or contingent, and of whatever nature.  (b) Since June 30, 2008 (the “ Balance Sheet Date ”), there has been no material adverse change in the assets or liabilities, or in the business or condition, financial or otherwise, or in the results of operations or prospects, of the Company, whether as a result of any legislative or regulatory change, revocation of any license or rights to do business, fire, explosion, accident, casualty, labor trouble, flood, drought, riot, storm, condemnation, act of God, public force or otherwise and no material adverse change in the assets or liabilities, or in the business or condition, financial or otherwise, or in the results of operation or prospects, of the Company except in the ordinary course of business.  (c) Since the Balance Sheet Date, the Company has not suffered any damage, destruction or loss of physical property (whether or not covered by insurance) affecting its condition (financial or otherwise) or operations (present or prospective), nor has the Company issued, sold or otherwise disposed of, or agreed to issue, sell or otherwise dispose of, any capital stock or any other security of the Company and have not granted or agreed to grant any option, warrant or other right to subscribe for or to purchase any capital stock or any other security of the Company or has incurred or agreed to incur any indebtedness for borrowed money.  (d) The Financial Statements are contained in the Company’s filings and reports made with the Securities and Exchange Commission (“SEC”) since the Company’s formation (the “SEC Reports”).

 

 

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SEC Reports. The Company’s SEC Reports are (i) accurate and complete, (ii) contain all information required to be filed under the rules and regulations of the SEC, (iii) are not subject to any outstanding SEC comment letters or inquiries, and (iv) do not contain any false statement of fact or fail to state any fact necessary to make the facts stated therein not misleading.  The Company has timely filed all periodic reports, registrations and statements, including any amendment thereto, required to be filed with the SEC. The Company has never been subject to any investigation, injunction or cease and desist action by the Securities and Exchange Commission or other federal or state regulatory agency and to its Knowledge is not currently subject to such pending or threatened actions.

 

SEC Status . The Company is a “filer” under Section 12(g) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).

 

No Litigation .  The Company is not a party to any suit, action, arbitration, or legal, administrative, or other proceeding, or to their Knowledge, pending or threatened governmental investigation.  The Company is not subject to or in default with respect to any order, writ, injunction, or decree of any federal, state, local, or foreign court, department, agency, or instrumentality.

 

No Taxes . The Company is not, and will not, to the best of its knowledge, become with respect to any periods ending on or prior to the Closing(s) Date, liable for any income, sales, withholding, franchise, excise, license, real or personal property taxes (a “ Tax ”) to any foreign, United States federal, state or local governmental agencies whatsoever. All United States federal, state, county, municipality local or foreign income Tax returns and all other material Tax returns (including information returns) that are required, or have been required, to be filed by or on behalf of the Company has been or will be filed as of the Closing(s) Date and all Taxes due pursuant to such returns or pursuant to any assessment received by the Company have been or will be paid as of the Closing(s) Date.  The charges, accruals and reserves on the books of the Company in respect of taxes or other governmental charges have been established in accordance with the tax method of accounting. All returns of the Company that have been filed relating to Tax are true and accurate in all material respects.  No audit, action, suit, proceeding or other examination regarding taxes for which the Company may have any liability is currently pending against or with respect to the Company and the Company has not received any notice (formally or informally) of any audit, suit, proceeding or other examination.  No material adjustment relating to any Tax returns, no Closing(s) or similar agreement have been entered into or issued or have been proposed (formally or informally) by any tax authority (insofar as such action relate to activities or income of or could result in liability of the Company for any Tax) and no basis exists for any such actions.  The Company has not changed any election, adopted or changed any accounting method or period, filed any amended return for any Tax, settled any claim or assessment of any Tax, or surrendered any right to claim any refund of any Tax, or consented to any extension or waiver of the statute of limitations for any Tax.  The Company has not had an “ownership change” as that term is defined in Section 382 of the Internal Revenue Code of 1986, as amended and in effect.

 

Conduct of the Business .  The Company is a shell company as defined in Rule 12b-2 of the Exchange.  From and after June 30, 2008 until the Closing(s) Date:

 

The Company has not made any expenditures or entered into any commitments which, when compared to past operations of their businesses, are unusual or extraordinary or outside the scope of the normal course of routine operations;

 

The Company has kept in a normal state of repair and operating efficiency all tangible personal property used in the operation of their businesses;

 

The Company has used their best efforts to maintain the good will associated with their businesses, and the existing business relationships with their agents, customers, lessors, key employees, suppliers and other persons having relations with them;

 

 

4


 

The Company has not entered into any contract, agreement or action, or relinquished or released any rights or privileges under any contracts or agreements, the performance, violation, relinquishment or release of which could, on the date on which such contract or agreement was entered into, or such rights or privileges were relinquished or released, be reasonably foreseen to have a material adverse effect;

 

The Company has not made, or agreed to make, any acquisition of stock or assets of, or made loans to, any person not in the ordinary course of business;

 

The Company has not sold or disposed of any assets or created or permitted to exist any encumbrance on their assets except (x) in the ordinary course of business and which could not, on the date of such sale, disposition, creation or permission, be reasonably foreseen to have a material adverse effect or (y) as otherwise permitted by this Agreement;

 

The Company has kept true, complete and correct books of records and accounts with respect to their businesses, in which entries will be made of all transactions on a basis consistent with past practices and in accordance with the tax method of accounting consistently applied by the Company;

 

The Company has paid current liabilities as and when they became due and have paid or incurred no fees and expenses not in the ordinary course of their businesses;

 

There has been no declaration, setting aside or payment of any dividend or other distribution in respect of any Shares or any other securities of the Company (whether in cash or in kind);

 

The Company has not redeemed, repurchased, or otherwise acquired any of their securities or entered into any agreement to do so;

 

The Company has not made any loan to, or entered into any other transaction with, any of their directors, officers, and employees;

 

The Company has not made or pledged to make any charitable or other capital contribution outside the ordinary course of business; and

 

There has not been any other occurrence, event, incident, action, failure to act or transaction outside the ordinary course of business that would have a material adverse effect.

 

Liabilities .

 

Except as set forth in the Financial Statements, the Company has no liabilities or obligations. It is a condition to Closing(s) that the Company will have no liabilities upon transfer of the Shares to the Purchaser.

 

Since June 30, 2008, the Company has not:

 

subjected to encumbrance, or agreed to do so to any of their assets, tangible or intangible other than purchase money liens in the ordinary course of business on equipment used in the conduct of business and incurred to finance the purchase price of the equipment involved and which do not cover any other asset of the Company;

 

except as otherwise contemplated hereby, engaged in any transactions affecting their businesses or properties not in the ordinary course of business consistent with past practice or suffered any extraordinary losses or waived any rights of substantial value except in the ordinary course of business; or

 

other than in the ordinary course of business consistent with past practice, granted or agreed to grant, or paid or agreed to pay any increase in the rate of wages, salaries, bonuses or other remuneration of any officer, director or consultant of the Company or any increase of 5% or more in the rate of wages, salaries, bonuses or other remuneration of any non-officer/director or employee or become a party to any employment contract or arrangement with any of its directors, officers, consultants or employees or become a party to any contract or arrangement with any director, officer, consultant or employee providing for bonuses, profit sharing payments, severance pay or retirement benefits, other than as set forth in any Exhibit or Schedule hereto.

 

 

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ERISA Compliance .  The Company maintains no “employee benefit plan” within the meaning of Section 3(3) of the Employee Retirement Income Security Act of 1974 (“ ERISA ”), under which the Company or any ERISA Affiliate has any current or future obligation or liability or under which any employee of the Company or any ERISA Affiliate has any current or future right to benefits.

 

Compliance with Law .  To the best of its Knowledge, the Company has complied with, and is not in violation of any provision of laws or regulations of federal, state or local government authorities and agencies, including any environmental laws and regulations. There are no pending or threatened proceedings against the Company by any federal, state or local government, or any department, board, agency or other body thereof.

 

Consents; No Preemptive Rights .  No third parties consents are required to be obtained in connection with the execution and delivery of this Agreement and Escrow Agreement and the consummation of the transactions contemplated by this Agreement and the Escrow Agreement nor as a result of the change of control of the Company hereby. There are no preemptive rights of any third party to purchase securities of the Company.

 

Agreements .  The Company is not a party to any material agreement, loan, credit, lease, sublease, franchise, license, contract, commitment or instrument or subject to any corporate restriction.  True, correct and complete copies of all such loan or credit agreements have been delivered to the Purchaser.  Neither the Company nor any other party is in default under any such agreement, loan, credit, lease, sublease, franchise, license, contract, commitment, instrument or restriction.  No such instrument requires the consent of any other party thereto in order to consummate the sales of the Shares hereby.

 

No Broker’s Fees .  There are no brokers or dealers of the Company.  There are no fees issued or outstanding nor will there by upon the consummation of the transaction(s) be, payable to any brokers or finder.

 

Title to Assets . The Company has good and marketable title to, or a valid leasehold interest in, the properties and assets used by it, located on its premises, or shown on the Company Balance Sheet or were acquired after the date of such balance sheet. The Company owns or has valid contractual rights to use all of the assets of the business and rights necessary to operate the business of the Company as currently conducted.

 

2.24    Bank Accounts . The Company has disclosed to the Purchaser

 

a list of and other pertinent information relating to all bank accounts maintained by the Company and identifies each individual having signatory authority with respect to each such account.

 

Affiliate Transactions . There are no material agreements, contracts, transfers of assets or liabilities or other commitments or transactions, whether or not entered into in the ordinary course of business, to or by which the Company or any of its Affiliates are or have been a party or otherwise bound or affected, and that (a) are currently pending, in effect or have been in effect at any time since June 30, 2008 or (b) involve continuing liabilities and obligations that, individually or in the aggregate, have been, are or will be material to the Company taken as a whole.

 

Derivative Transactions and Hedging . There are no Derivative Transactions (including each outstanding commodity or financial hedging position) entered into by the Company or for the account of any of its customers as of the date of this Agreement.  All such Derivative Transactions were, and any Derivative Transactions entered into after the date of this Agreement will be, entered into in accordance with applicable Laws, and in accordance with the investment, securities, commodities, risk management and other policies, practices and procedures employed by the Company, and were, and will be, entered into with counterparties believed at the time, still believes to be financially responsible and able to understand (either alone or in consultation with their advisers) and to bear the risks of such Derivative Transactions.  

 

 

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The Company has, and will have, duly performed all of its obligations under the Derivative Transactions to the extent that such obligations to perform have accrued, and there are and will be no breaches, violations, collateral deficiencies, requests for collateral or demands for payment, or defaults or allegations or assertions of such by any party thereunder. " Derivative Transaction " means any swap transaction, option, warrant, forward


 
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