Capital Investment Agreement

CAPITAL INVESTMENT AGREEMENT

This Capital Investment Agreement (the "Agreement") is made and entered into as of Effective Date: by and between Investor Name: (Investor), Entity Type: Individual Corporation LLC , and Company Name: (Company), Entity Type: Corporation LLC Partnership .

RECITALS

WHEREAS, the Company desires to raise capital to fund the Company's operations and growth initiatives and has authorized the issuance of certain securities; and

WHEREAS, the Investor is willing to make an investment in the Company on the terms and subject to the conditions set forth in this Agreement; and

WHEREAS, the parties desire to set forth their agreement with respect to the investment and the rights and obligations relating thereto.

NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein, the parties agree as follows:

1. DEFINITIONS

For purposes of this Agreement, the following terms have the meanings indicated:

"Closing" means the closing of the purchase and sale of the Securities pursuant to Section 3.

"Securities" means the shares, units or other equity interests to be issued to Investor as described in Section 2.

2. INVESTMENT AND ISSUANCE

2.1 Purchase and Sale. Subject to the terms and conditions set forth in this Agreement, on the terms set forth herein Investor shall purchase, and the Company shall issue and sell to Investor, Securities consisting of:

Number of Securities: ; Class/Series: ; Purchase Price per Security: $ ; Aggregate Purchase Price: $ .

2.2 Form of Payment. Investor shall pay the Aggregate Purchase Price by wire transfer of immediately available funds or other method acceptable to the Company at or prior to the Closing.

3. CLOSING

3.1 Closing Date and Location. The Closing shall occur on the Closing Date: at such place as the parties shall mutually agree, or by electronic exchange of documents.

3.2 Deliveries by the Company. At the Closing, the Company shall deliver to Investor evidence of issuance of the Securities registered in the name of Investor and such certifications and corporate authorizations as set forth in Section 4.

3.3 Deliveries by Investor. At the Closing, Investor shall deliver the Aggregate Purchase Price to the Company and any required execution of ancillary documents.

4. REPRESENTATIONS AND WARRANTIES

4.1 Company Representations. The Company hereby represents and warrants to Investor that:

(a) Organization and Authority. The Company is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization, and has all requisite corporate power and authority to enter into and perform its obligations under this Agreement.

(b) Authorization. The execution, delivery and performance of this Agreement have been duly authorized by all necessary corporate action, and this Agreement constitutes a valid and binding obligation of the Company enforceable against the Company in accordance with its terms, subject to applicable bankruptcy, insolvency or other laws of general application.

(c) No Conflicts. The execution and performance of this Agreement do not and will not (i) violate the Company’s organizational documents, (ii) violate any material agreement to which the Company is a party, or (iii) require any consents not already obtained, except as disclosed in Company Disclosures.

4.2 Investor Representations. The Investor hereby represents and warrants to the Company that:

(a) Power and Authority. The Investor has full power and authority to enter into and perform this Agreement.

(b) Investment Intent. The Investor is acquiring the Securities for investment for its own account, not as a nominee or agent, and not with a view to or for sale in connection with any distribution of the Securities in violation of applicable securities laws.

5. COVENANTS

5.1 Use of Proceeds. The Company shall use the proceeds from the sale of the Securities solely for the purposes described in the Company’s business plan and for working capital and growth initiatives; material departures shall require Investor approval.

5.2 Information Rights. For so long as Investor holds at least of the outstanding Securities, the Company shall provide annual audited financial statements and quarterly unaudited financial statements to Investor within a commercially reasonable period.

5.3 Board Observation. Investor shall have the right to appoint an observer to the Company’s board of directors, subject to reasonable confidentiality obligations and the Company’s governance documents.

6. TRANSFER RESTRICTIONS

6.1 Restrictions. The Securities shall be subject to customary transfer restrictions, including legends, right of first refusal in favor of the Company or other stockholders, and any required securities law compliance.

6.2 Tag-Along and Drag-Along. The Securities shall be subject to tag-along and drag-along provisions reasonably acceptable to Investor and as set forth in the Company’s shareholder agreement or similar agreement.

7. INDEMNIFICATION

The Company shall indemnify and hold harmless Investor and its affiliates, directors, officers and agents from and against any losses arising out of any breach of the Company’s representations, warranties or covenants contained in this Agreement, except to the extent caused by Investor’s gross negligence or willful misconduct. Investor shall indemnify the Company for breaches of Investor representations.

8. CONDITIONS PRECEDENT

The obligations of each party to consummate the transactions contemplated hereby are subject to the fulfillment, prior to or at the Closing, of customary conditions precedent, including but not limited to: (a) accuracy of representations and warranties; (b) performance of covenants; (c) delivery of organizational and regulatory approvals; and (d) execution of ancillary agreements.

9. MISCELLANEOUS

9.1 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of without regard to conflict of laws principles.

9.2 Entire Agreement. This Agreement, together with the exhibits, schedules and ancillary documents expressly referenced herein, constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior agreements and understandings, whether written or oral.

9.3 Severability. If any provision of this Agreement is held to be invalid or unenforceable, the remaining provisions shall remain in full force and effect and the parties shall replace the invalid or unenforceable provision with a valid provision that most nearly reflects the parties’ intent.

9.4 Notices. All notices, consents or other communications required or permitted under this Agreement shall be in writing and delivered to the parties at the addresses set forth below or to such other address as either party may designate by notice:

9.5 Amendments and Waiver. Any amendment or waiver of any provision of this Agreement must be in a writing signed by the parties to be bound thereby. No course of dealing or failure to enforce any right shall operate as a waiver of that or any other right.

9.6 Counterparts; Electronic Signatures. This Agreement may be executed in counterparts, each of which shall constitute an original, and all of which together shall constitute one and the same instrument. The parties agree that signatures transmitted by electronic means shall be deemed original signatures.

SIGNATURES

Sign Now