SUBSCRIPTION PROCEDURE
To Subscribe for Notes and Warrants of
Novint Technologies, Inc.:
| 1. |
Date and Fill In the
amount of Notes and Warrants being subscribed to and
Complete and Sign the
Subscription Agreement on the applicable Signature
Page.
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2.
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Fax the
signed Subscription Agreement to, and send all signed originals to
and form of payment to:
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Novint
Technologies, Inc.
Attn:
CEO
4601
Paradise Blvd NW
Albuquerque,
NM 87114
Phone:
505-463-1469
Fax:
866-298-4420
| 3. |
Please
make your subscription payment payable to the order of
“Novint Technologies, Inc.”
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| 4. |
Wire
Transfer Instructions if paying by wire transfer:
|
Wells
Fargo Bank, NM
routing
number: 121000248
account
number: 2374173264
account
name: Novint Technologies, Inc.
Thank
you for your interest.
SUBSCRIPTION AGREEMENT
This
SUBSCRIPTION AGREEMENT ("
Subscription Agreement ")
is made and entered into as of ___________, 2008 by and
between
Novint Technologies, Inc. ,
a Delaware corporation ("
Company "),
and the subscribers whose names and addresses are set forth on the
signature page hereto (each a "
Subscriber ").
The
Notes and Warrants are sometimes referred to herein as the
“
Securities .”
In
connection with this subscription, Subscriber and the Company
agree as follows:
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A. |
Subscription of the Subscriber
.
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1.
Purchase of Notes and Warrants. The
undersigned Subscriber hereby irrevocably agrees, represents and
warrants with, to and for the benefit of the Company, that such
Subscriber is executing this Subscription Agreement in connection
with the subscription by the Subscriber for (A) that aggregate
principal amount of the 7% Unsecured Promissory Notes
(“
Notes ”)
in the form of that attached hereto as Exhibit A in the amount as
set forth on the signature page hereof (“
Subscription Price ”)
(which aggregate amount for all Subscribers shall be up to
$2,050,000 and (B) warrants, in the form attached hereto as Exhibit
B (the “
Warrants ”)
to acquire up to that number of additional shares of common stock
of the Company set forth on the signature page hereof (as
exercised, the “
Warrant Shares ”).
With respect to each Subscriber, the number of Warrant Shares
underlying the Warrant shall equal the principal amount of the Note
purchased by the Subscriber. The Warrants are exercisable for a
term of five (5) years at an exercise price of $1.00.
The
Subscriber understands that the Company is relying upon the
accuracy and completeness of the information contained herein
in complying with its obligations under federal and state
securities and other applicable laws. Subject to the terms and
conditions of this Subscription Agreement, upon execution and
delivery hereof by the Subscriber, the Subscriber hereby
agrees to purchase the Securities pursuant to the transaction
hereof, and against concurrent delivery of the purchase price
for such shares. The date upon which the final subscription is
accepted by the Company and the full Subscription Price has
been tendered to the Company, shall be known as the
“
Closing Date .”
2.
Offering .
This
offering of the Securities (the "
Offering ")
is being made to a limited group of investors, all of whom shall
represent to the Company pursuant to this Subscription Agreement
that they are "accredited investors," as that term is defined in
Regulation D promulgated under the Securities Act of 1933, as
amended (the "
Securities Act ")
or who have otherwise been qualified as investors by the Company.
All of the Securities offered hereby is being sold by the Company.
The Company is offering the Securities for the consideration set
forth herein. The Company may sell less than all of the Securities
offered hereby, and shall be entitled to accept subscriptions and
receive the Subscription Price for each subscription prior to the
entire Offering being subscribed for. The Offering is being made on
a “best efforts” basis. The maximum offering by the
Company is $1,250,000 worth of Securities. This amount may be
increased at the Company's discretion.
3.
Convertible Notes. The principal and interest amount owed under
the Notes may be converted during the term of the Note into the
Company’s equity securities at each holder’s option as
follows: the principal amount then due may be converted into common
stock of the Company at the conversion rate of $1.00 per share.
Upon conversion, the holder will also receive warrants to purchase
common stock at an exercise price of $1.50 per share
(“
Additional Warrants ”).
The number of shares of common stock underlying the Additional
Warrants shall equal one-half (½) the principal and interest
amounts converted. The Additional Warrants shall be exercisable for
a term of five (5) years at an exercise price of $1.50. Accrued
interest may at the option of the Company be paid in cash or common
stock and warrants in accordance with the conversion terms in this
Section 3.
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B. |
Representations and Warranties of the
Subscriber
|
.
The Subscriber hereby represents and warrants to the Company
as of the date hereof:
1.
Place of Business
. The
principal place of business address set forth below is such
Subscriber's true and correct principal place of business and is
the only jurisdiction in which an offer to sell the Securities was
made to such Subscriber and such Subscriber has no present
intention of moving its principal place of business to or of
becoming a resident of any other state or
jurisdiction.
2.
Sale or Transfer of the Securities.
The
Subscriber understands that the Securities have not been registered
under the Securities Act, or under the laws of any other
jurisdiction. The Subscriber understands and agrees that transfer
or sale of the Securities may be restricted or prohibited unless
they are subsequently registered under the Securities Act and,
where required, under the laws of other jurisdictions or an
exemption from registration is available. The Subscriber will not
offer, sell, transfer or assign its Securities or any interest
therein in contravention of this Subscription Agreement, the
Securities Act or any state or federal law. The Subscriber
understands and acknowledges that, because of the substantial
restrictions on the transferability of the Securities, it may not
be possible for the Subscriber to liquidate the Subscriber's
investment in the Company readily, even in the case of an
emergency.
3.
Representation of Accredited Investor Status, Investment Experience
and Ability to Bear Risk .
Subscriber
acknowledges that the Offering has not been registered with the
Securities and Exchange Commission because the Company is relying
on an exemption from registration under Section 4(2) of the
Securities Act and Regulation D promulgated thereunder.
Subscriber
believes that at the time of the sale of the Securities to
Subscriber, Subscriber (or, if Subscriber is a corporation, limited
liability company or trust, each of its equity owners) qualifies as
an "accredited investor" (as defined under Rule 501 of Regulation D
promulgated under the Securities Act) using the following
qualification factors (check all appropriate
items):
(__)
$1,000,000 Net Worth Test:
I,
Subscriber, am a natural person and my individual net worth,
or joint net worth with my spouse (if any),
inclusive of
home, furnishings and automobiles, at the time of this purchase is
in excess of $1,000,000.
(__)
$200,000
Individual/$300,000 Joint Annual Income Test:
I,
Subscriber, am a natural person and my individual annual gross
income (exclusive of my spouse's income) has been in excess of
$200,000 in each of the two most recent tax years, and I
reasonably expect individual annual gross income (exclusive of
my spouse's income) to be in excess of $200,000 for the
current tax year; or I am a natural person and my joint annual
gross income (including my spouse's annual gross income) has
been in excess of $300,000 in each of the two most recent tax
years, and I reasonably expect our joint annual gross incomes
to be in excess of $300,000 for the current tax
year.
("Income" under
this test is defined as adjusted gross income for federal income
tax purposes
plus (i)
deductions for long-term capital gains under the Internal Revenue
Code; (ii) deductions for depletion under section 611 et seq. of
the Code; (iii) any exclusion for interest received on tax-exempt
securities; and (iv) any losses of a Company allocated to the
individual limited partners of the Company as reported on Form
1040).
(__)
Bank or Investment Company Test:
Subscriber
is a bank as defined in section 3(a)(2) of the Securities Act,
or any savings and loan association or other institution as
defined in section 3(a)(5)(A) of the Securities Act, whether
acting in its individual or fiduciary capacity; or is a broker
or dealer registered pursuant to section 15 of the Securities
Exchange Act of 1934; or is an insurance company as defined in
section 2(13) of the Securities Act; or is any investment
company registered under the Investment Corporation Act of
1940, or a business development company as defined in section
2(a)(48) of that Act; or is a Small Business Investment
Corporation licensed by the U.S. Small Business Administration
under section 301(c) or (d) of the Small Business Investment
Act of 1958; is a plan established and maintained by a state,
its political subdivision, 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; or is an employee benefit plan within the meaning
of the employee Retirement Income Security Act of 1974, if 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
adviser, or if the employee benefit plan has total assets in
excess of $5,000,000, or, if a self-directed plan, with
investment decisions made solely by persons that are
accredited investors.
(__)
Private Business Development Corporation
Test:
Subscriber
is a private business development company as defined in
section 202(a)(22) of the Investment Advisors Act of
1940.
(__)
IRC Section 501(c)(3) Organization Test:
Subscriber
is an organization described in Section 501(c)(3) of the
Internal Revenue Code, corporation, Massachusetts or similar
business trust, or Company, not formed for the specific
purpose of acquiring the securities being offered, with total
assets in excess of $5,000,000.
(__)
Direct Relationship to Issuer Test:
Subscriber
is a director, executive officer, partner or manager of the
Company of the securities being offered or sold, or any
director, executive officer or manager of a partner or partner
of that issuer.
(__)
$5,000,000 Noninvestment Trust Test:
Subscriber
is a trust with total assets in excess of $5,000,000 not
formed for the specific purpose of acquiring the securities
being offered, whose purchase is directed by a "sophisticated
person" as described in section
230.506(b)(2)(ii).
(__)
Equity Entity Comprised of Accredited Investors
Test:
Subscriber
is any equity entity in which all of the equity owners are
accredited investors as defined above. Subscriber has had one
of the persons responsible for overseeing and/or managing one
or more of Subscriber’s financial accounts complete the
attestation in Section D hereof in order to verify the
information in this Section B:
Yes
_________
No _________
In
addition, Subscriber is knowledgeable and experienced with
respect to the financial and business activities contemplated
by the Company and is capable of evaluating the risks and
merits of investing in the Securities and, in making a
decision to proceed with this investment, has not relied upon
any representations, warranties or agreements, other than
those set forth in this Subscription Agreement and can bear
the economic risk of an investment in the Company for an
indefinite period of time, and can afford to suffer the
complete loss thereof.
4.
Own Advice .
In connection with the Subscriber's investment in the Company, the
Subscriber has carefully considered and has, to the extent the
Subscriber believes such discussion necessary, discussed with the
Subscriber's professional legal, tax and financial advisers (the
"
Investment Advisors ")
the suitability of an investment in the Securities for the
Subscriber's particular tax and financial situation and the
Subscriber has determined that the Securities are a suitable
investment for the Subscriber.
5.
Risks .
The Subscriber represents and warrants that the Subscriber is aware
(i) that the Securities involve a substantial degree of risk
of loss of the Subscriber's entire investment and that there is no
assurance of any income from the Subscriber's investment; and
(ii) that any federal and/or state income tax benefits which
may be available to the Subscriber, if any, may be lost through the
adoption of new laws or regulations, to changes to existing laws
and regulations and to changes in the interpretation of existing
laws and regulations. The Subscriber further represents that the
Subscriber is relying solely on the Subscriber's own conclusions or
the advice of the Subscriber’s Investment Advisors with
respect to tax aspects of any investment in the Securities. The
Subscriber further represents that it has read and reviewed the
Company’s filings made with the Securities and Exchange
Commission.
6.
Inquiries .
The Subscriber and its Investment Advisors have been given access
to, and prior to the execution of this Subscription Agreement, have
been provided with an opportunity to ask questions of, and receive
answers from, the Company officers concerning the Company and the
terms and conditions of the Offering and the Securities, and to
obtain any other information which the Subscriber and the
Subscriber's Investment Advisors required with respect to the
Company and an investment in the Company in order to evaluate such
investment and verify the accuracy of all information furnished to
the Subscriber and its Investment Advisors regarding the Company.
All such questions, if asked, were answered satisfactorily and all
information or documents provided were found to be satisfactory.
Neither the Subscriber nor its Investment Advisors have been
furnished any offering literature on which they have relied on
other this Subscription Agreement and the Subscriber and its
Investment Advisors have relied only on this Subscription
Agreement. At no time was the Subscriber presented with or
solicited by any leaflet, public promotion meeting, newspaper or
magazine article, radio or television advertisement or any other
form of general advertising or general solicitation.
7.
Authority
. The Subscriber is authorized and has full right and power to
subscribe for the Securities and to perform the Subscriber's
obligations pursuant to the provisions of this Subscription
Agreement; the person signing this Subscription Agreement and any
other instrument executed and delivered herewith on behalf of such
Subscriber has been duly authorized by such entity and has full
power and authority to do so. If the Subscriber is a corporation,
partnership, unincorporated association or other entity, the person
signing this agreement has the legal capaci
