10.11[2] Officers and Directors Questionnaire
_______________ CO., INC. Private Placement of Series A Preferred Stock
OFFICERS' AND DIRECTORS' QUESTIONNAIRE NAME: _________________________
(Please print full name)___________________________________________________________________________
Attention: ____________________, Esq.Gentlemen/Ladies:The following information is furnished to you for use in connection with
the preparation of a private placement memorandum for the private placement of
600,000 shares of Series A Preferred Stock (the "Memorandum"). I will promptly
notify you of any changes in such information which may occur subsequent hereto
and prior to the closing of the sale of Preferred Stock. I understand that you
will provide copies of this questionnaire as completed by me, and relay all my
further communications regarding the matters contemplated herein, to counsel for
the Company and to the representatives of the Selling Agent and its counsel, for
use in connection with the preparation of the Memorandum, and you and each of
such persons and firms may rely thereon.
The definitions of certain other terms used in this questionnaire are set
forth at the end of this questionnaire.
1. Positions with the Company
All positions and offices (including director) which I have held with the
Company or any parent or subsidiary of the Company (including any present
position), and the length of time I have held them, are described below:
Time Period
(Month and Year)
List of Positions From To
2. Personal Data I can provide the following personal data about myself: (a) Date of Birth: ________________
(b) Degrees held:
Degree:
Field of Study:
Year Awarded:College:Awarding:Degree:
3. Business Experience(a) My principal occupations and employment (other than with the Company
but including any parent or subsidiary of the Company) during the past five
years, including the official name and principal business of any corporation or
organization in which such occupations and employment were carried on, my
positions or offices therewith, and the nature of my responsibilities therein
are as indicated below:
Time Period: From: To:
Name and Principal
Business of Corporation
or Responsibilities: Position:
Nature of My Responsibilities:
(b) I am presently a director of the following companies which either (1)
have a class of securities registered pursuant to Section 12 of the Securities
Exchange Act of 1934 or subject to the requirements of Section 15(d) of that Act
(so called "publicly held" companies) or (2) are registered as investment
companies under the Investment Company Act of 1940:
Company Name:Location:
Term of Office:
4. Family Relationships (a) I do not now have, nor have I ever had, any family relationship (see
definition) with any director or officer (or nominee to become a director or
officer) of the Company, except as follows:
No exception _____.
Exception _____. Description:
(b) I am not married _____.
I am married _____. The names of my spouse and children, if any, are
as follows:
Spouse: __________
Children: ______________________________
5. Arrangements for Selection I have not entered into any arrangement (see definition) or understanding
with any person pursuant to which I was selected as an officer or director of
the Company, except as follows:
(a) No exception _____.
(b) Exception _____. Description:
6. No Adverse Interest
To the best of my knowledge, neither I nor any associate (see definition)
of mine has or will have an interest adverse to that of the Company or any of
its subsidiaries in any pending or contemplated legal proceeding (including
administrative proceedings and investigations by governmental authorities) to
which the Company or any of its subsidiaries is or will be a party or of which
any of its or their property is or will be the subject, except as follows:
(a) No exception _____.
(b) Exception _____. Description:
7. Promoters
(a) If I am a promoter (see definition) of the Company, the information
provided below is true and correct to the best of my knowledge.
(1) I am a promoter _____.
(2) I am not a promoter _____.(A) I have stated below the nature and amount of anything of
value (including money, property, contracts, options or rights of any kind)
received or to be received by me, directly or indirectly, from the Company and
the nature and amount of any assets, services or other consideration therefor
received or to be received by the Company:
(B) As to any assets acquired or to be acquired by the Company
from me, I have stated the amount at which the assets were acquired or are to be
acquired and the principle followed or to be followed in determining such amount
and identified the persons making the determination and their relationship, if
any, with the Company, me or any other promoter. If the assets were acquired by
me within two years prior to their transfer to the Company, I have stated the
cost thereof to me:
8. Legal Proceedings: Investigations
To the best of my knowledge, no legal proceeding (including any
administrative proceeding or investigation by governmental authorities) is
pending or contemplated to which the Company or any of its subsidiaries is or
would be a party or of which any of its or their property is or would be the
subject, except as follows:
(a) I know of none _____.
(b) I am aware of such a proceeding or proceedings _____.
Description:
9. 5% Stockholders
Except as set forth below, I do not know of any person (including myself
and my associates and including corporations, partnerships, trusts, associations
and other such groups) who owns beneficially (see definition) more than 5 % of
any class of the Company's stock:
(a) I know of no such person _____.
(b) I am aware of such a person _____. Description:
10. Voting Arrangements
I do not know of any voting trust or similar agreement or arrangement (see
definition) under which more than 5% of the Company's outstanding Common Stock
is held or to be held, except as indicated below:
(a) I do not know of any such voting trust or similar agreement
_____. (b) I know of such a voting trust or similar agreement _____.
Description:
11. Change in Control
I do not know of any arrangement (see definition), including any pledge by
any person of securities of the Company, the operation of which may at a
subsequent date result in a change in control (see definition) of the Company,
except as indicated below:
(a) I know of no such arrangement _____.
(b) I know of such an arrangement _____. Description:
12. Share Ownership (a) Information as to the shares of Common Stock, Junior Stock and
Preferred Stock (indicating which series) of the Company beneficially (see
definition) owned by me as of the date of this questionnaire is furnished below.
I have included all shares which are (1) registered in my name, including shares
registered in my name as trustee, executor, custodian, pledgee, agent or
nominee, either alone or with others, (2) owned beneficially (see definition) by
me or any associate (see definition) of mine or (3) registered in the name of a
nominee or in street name, including any such shares held for the account of any
of the above. If I wish to disclaim beneficial ownership of any shares listed, I have so
indicated by writing the word "Disclaim" in the Remarks column below; and I
understand that such shares will be shown separately from my beneficial holdings
and an appropriate disclaimer set forth. If any co-trustee, etc., acting with me is an officer or director of the
Company, I have set forth his name in the Remarks column.
If any of the shares listed are subject to any claim, encumbrance, pledge
or lien, I have so indicated in the Remarks column.
Class and Series of Stock:
Number of Shares:
Registered in the Name of:
Beneficially Owned by:Remarks:
Shares Voted by:
(b) I have the right to acquire (through exercise of warrants or options,
conversion of Preferred Stock, or otherwise), at any time within sixty days of
the closing of the Offering, beneficial ownership of shares of Common Stock or
Preferred Stock of the Company as indicated below:
(1) I have no such right _____.
(2) I have such a right _____. Description:
Type of Security underlying such right (e.g., Common Stock, Series A Preferred, etc.):_____.
_____ shares through the exercise of any option, warrant or
right. (Please describe:
____________________________________________________);
_____ shares through the conversion of a security (Title of
convertible security: _____);
_____ shares pursuant to the power to revoke a trust,
discretionary account or similar arrangement; and/or
_____ shares through or pursuant to ______________________________________________________.
13. Interest in Subsidiaries
I do not beneficially (see definition) own any equity securities of any
subsidiary of the Company, except as follows:
(a) I do not own any such securities _____.
(b) I do own such securities _____. Description:
14. Cash and Noncash Remuneration (a) Salary and Bonus. The amount of cash remuneration (including salary,
bonuses, fees, commissions and directors' fees, whether paid on a current basis
or deferred pursuant to Section 401(k) of the Internal Revenue Code or pursuant
to any arrangement) paid or accrued to me by the Company and its subsidiaries
during the Company's Last Fiscal Year (including cash bonuses paid during one
fiscal year for services rendered to the Company in a previous fiscal year) is
furnished below:
Earned in Last Earned
Fiscal Year and in Second
Paid Preceding
After Year
Paid in End of But Paid
Last Last Not in Last Capacity
Fiscal Fiscal Yet Fiscal in Which
Description Year Year Paid Year Received Salary: Fees (other than directors' fees): Directors' Fees: Commissions:
Bonuses: Other Arrangements: TOTAL:(b) Standard Director Arrangements. If I am a director of the Company, its
parent or any subsidiary, I have described below any standard arrangement,
including consulting contracts, stating amounts, pursuant to which I am
compensated for all services as a director, including any additional amounts
payable for committee participation or special assignments.
Item Amount
Retainer $_____
Fee per Board meeting attended $_____
Fee per Committee meeting attended $_____
Other (describe below) $_____
(c) Other Director Arrangements. If I am a director of the Company, its
parent or any subsidiary, I have described below any other arrangements pursuant
to which I was compensated during the Company's Last Fiscal Year for services to
the Company, stating the amount paid.
(d) Director Legacy Programs. If I am a director and the Company has a
"director legacy" or "charitable award" program, I have described below the
material terms of such program.
(e) Employment Contracts Termination of Employment and Change-In-Control
Agreements.
(1) If I am an executive officer, I have described below any
management contract, employment contract, compensatory plan or arrangement
between the Company and me.
(2) I have described below any payments to be received from the
Company if such a contract, plan or arrangement results or will result from my
resignation, retirement or any either termination of my employment with the
Company and its subsidiaries or from a change in control of the Company or a
change in my responsibilities following change in control.
(f) Property Purchased. The spread between the acquisition price (purchase
price) and the fair market value of all property (other than securities) of the
Company acquired by me during the Company's Last Fiscal Year is furnished below.
(1) I did not acquire any property _____.
(2) I did acquire property _____. Description:
Nature of Transaction:
Description of Property (if applicable):
Date of Event:
Acquisition Price Fair Market Value:
(g) Discount Stock. I have provided information below with respect to any
purchase by me of securities of the Company or its subsidiaries at a discount
during the Last Fiscal Year (whether purchased with cash, through deferral of
salary or bonus, or otherwise), except that I have excluded purchases made
pursuant to plans or arrangements (such as a Section 423 employee stock purchase
plan) that make such discount available generally to all shareholders or all
salaried employees:
Date of Purchase:Issuer:Security:
Number of Shares:
Purchase Price per Share:
FMV Per Share:
(h) Pension and Retirement. The amount of any contribution, payment,
accrual or allocation to my account by the Company or any of its subsidiaries
under any defined contribution retirement plan, annuity, employment contract
deferral, deferred compensation plan or similar arrangement (other than (1)
defined benefit or actuarial plans and contributions to plans for which specific
allocations for specific individuals are not made) during the Company's Last
Fiscal Year is furnished below:
Identification of "Plan"
(see definition): Amount:
(i) Life Insurance. The full dollar value of any premium paid by the
Company or any of its subsidiaries on any term life insurance policy on my life,
when the Company or its subsidiaries are not the sole beneficiaries, during the
Company's (ii) Last Fiscal Year is furnished below:
Insured:Beneficiary:
Full Dollar Value of Premiums Paid:
If there is any arrangement or understanding pursuant to which I have
received, or will receive, an interest in the cash surrender value of the
policy, I have provided the following additional information:
No such arrangement _____.
Additional information:(1) Full dollar value of remainder of premiums paid by the
Company- $_____
(2) If premiums will be refunded to the Company upon
termination of the policy, the dollar value of the benefit to me (determined for
the actuarially projected period between payment of the premium and the refund)
of the remainder of the premium paid by the Company during the Last Fiscal Year
is as follows: $_____.
(j) Health Insurance. The amount of any premium or other cost paid by the
Company or its subsidiaries under health insurance or medical reimbursement
plans during the Company's Last Fiscal Year is furnished below:
Description: Amount:
(k) Contributions to Plans. The amount of any contribution made for my
account by the Company or its subsidiaries to any stock purchase, profit-
sharing, thrift or similar plan during the Company's Last Fiscal Year is
furnished below:
Description:Amount:
(l) Personal Benefits. Personal benefits furnished to me during the
Company's Last Fiscal Year from the Company or its subsidiaries, directly or
through third parties, are described below. I have included personal benefits
such as payments made by the Company or its subsidiaries for (1) home repairs
and improvements, (2) housing and other living expenses provided at my principal
and/or vacation residences, (3) personal travel expenses, (4) personal
entertainment and related expenses, (5) medical expenses, (6) relocation
expenses, and (7) legal, accounting and other professional fees or matters
unrelated to the Company's business. I have also described any instances in
which I have had the personal use of the property of the Company or any of its
subsidiaries, such as Company automobiles, planes, yachts, apartments, hunting
lodges or Company vacation houses or the use by me of corporate staff for
personal purposes.
Description:
Dollar Amount, if Applicable:
(m) Future Remuneration. I have briefly described below all remuneration
payments proposed to be made to me in the future pursuant to any existing plan
(see definition) or arrangement (see definition), except for those previously
reported above.
Description:
(n) Defined Benefit or Actuarial Plans. (1) With respect to any defined benefit or actuarial plans of the
Company under which benefits are determined primarily by my final compensation
and years of service, I have described below with respect to each such plan the
amount of my compensation which is covered by the plan, the estimated credited
years of service which I have accumulated and the estimated annual benefits
payable to me upon retirement at normal retirement age:
Name of Plan:
Compensation Covered By Plan:
Estimated Credited Years of Service:
Estimated Annual Benefits Payable Upon Retirement:
(2) With respect to any defined benefit or actuarial plan under
which benefits are not determined primarily by my final compensation and years
of service, I have described below the formula by which benefits are determined
and the estimated annual benefits payable upon my retirement at normal
retirement age:
Name of Plan:
Description of Formula:
Estimated Annual Benefits Payable Upon Retirement:
(o) Third Party Transactions. During the past fiscal year, I was not paid
any compensation by a third party for services rendered to the Company, nor am I
aware of any transaction between the Company and a third party where the primary
purpose of the transaction is to furnish remuneration to me, except as stated below.
(1) No exception _____.
(2) Exception _____. Description:
(p) Noncash Compensation. A description of all noncash compensation
(excluding awards of Options or Restricted Stock reported under Sections 12 an
14 above) awarded, earned or paid to me by the Company and its subsidiaries
during the Company's Last Fiscal Year, including the fair market value of such
noncash compensation at the time the compensation was awarded, earned or paid,
is furnished below:
Date of Payment:
Description of Noncash Compensation:
Fair Market Value:
(q) Other Compensation. A description, including dollar value and, if
known, incremental cost to the Company, of all other compensation not described
above, including but not limited to (1) perquisites and other personal benefits,
securities or property; (2) amounts reimbursed for the payment of taxes; and (3)
interest or earnings on deferred or long-term incentive plan compensation is
furnished below:
15. Stock Options, Stock Appreciation Rights and Warrants
(a) Grants. The following is a list of all Stock Options,
Stock Appreciation Rights ("SARs") (see definitions) and warrants granted to me
or my associates (see definition) by the Company during the Last Fiscal Year,
including for each Stock Option, SAR or warrant (collectively referred to as an
"Option"), the type of Option and the plan, if any, pursuant to which such
Option was granted, the number of shares of Common Stock, Junior Stock or
Preferred Stock subject to each such Option, the date of grant, the purchase
price per share of Common Stock, Junior Stock or Preferred Stock subject to the
Option and the expiration date of the Option (if options were granted to any
associates, I have so noted below the table):
Type of Option Name of Plan:
Date of Grant:
Type of Stock:
Number of Shares:
Exercise (or Base) Price Per Share Date
of Expiration:
(b) Exercises. The following is a list of all Options
exercised by me during the Last Fiscal Year, including the date of exercise,
number of shares purchased, the purchase price per share, and the fair market
value per share on the date of exercise:
Date of Exercise:
Type of Stock:
Number of Shares Purchased:
Exercise Price Per Share (A):
Fair Market Value Per Share on Date
of Exercise (B):
Per Share Spread (B)-(A):
(c) Outstanding. The following is a list of all Options held
by me as of the end of the Last Fiscal Year, including the number of shares
subject to each such Option, the date of grant, the purchase price per share,
the expiration date of the Option, and the identity of the arrangement, if any,
pursuant to which such Option was originally granted:
Type of Option:
Name of Plan:
Date of Grant:
Type of Stock:
Total Number of Shares:
Number of Shares Exercisable within 60 days
Proposed Record Date:
Exercise Price Per Share:
Date of Expiration:
16. Restricted Stock and Other Stock-Related Awards (a) Awards. The following is a list of all shares of capital
stock of the Company, including Restricted Stock (see definition) and Phantom
Stock (see definition), awarded, earned or paid to me or my associates (see
definition), or which I or my associates purchased directly from the Company
(other than upon exercise of Stock Appreciation Rights (see definition) or Stock
Options (see definition), during the Last Fiscal Year, including the plan, if
any, pursuant to which such stock was awarded or purchased, the date of the
award or purchase, the class of security awarded or purchased, the number of
shares, the purchase price per share of the capital stock awarded or purchased,
and the fair market value of the stock (without any discount based on the
restricted nature of the stock) on the date of the award or purchase (if stock
was awarded to or purchased by any associates, I have so noted below in the table):
Plan:
Date of Award or Purchase:
Type of Stock:
Number of Shares:
Purchase Price Per Share:
Fair Market Value on Date of Award:
(b) Conditions to Vesting of Restricted Stock. I have provided
below a complete description of all conditions to the vesting of the Restricted
Stock and Phantom Stock listed in response to Section 16(a) above, including
lapse of time, continued service to the Company and performance-based conditions
(if more than one award is listed in Section 16(a) above, I have described the
vesting conditions by reference to the date of the award):
(c) Aggregate Restricted Stock Holdings at Fiscal Year End. I
have listed below, by reference to the date of the original award, the number of
shares of Restricted Stock and Phantom Stock held as of the end of the Company's
Last Fiscal Year and the vesting schedule thereof (if not granted during the
Last Fiscal Year):
Date of Original Award:
Number of Shares Held:
Vesting Schedule:
(d) Dividends on Restricted and Other Stock. I have indicated
below whether dividends (or dividend equivalents) will be paid on the Restricted
Stock, Phantom Stock and other stock held by me, and if such dividends (or
dividend equivalents) will be earned at a rate in preference to or higher than
dividends generally available on the Company's Common Stock:
(1) Dividends will not be paid on such stock. _____.
(2) Dividends will be paid at the same rate as for
Common Stock generally. _____.
(3) Dividends will be paid at a rate in preference to or
higher than dividends generally on the Common Stock. _____ Description:
17. Indebtedness to the Company
Except as described below, neither I nor any associate (see
definition) of mine has, during the Company's last three fiscal years and the
period since the end of the last fiscal year, been indebted to the Company or
any of its subsidiaries, except for amounts due for purchases subject to usual
trade terms, for ordinary travel and expense advances and for other transactions
in the ordinary course of business.
(a) No such indebtedness _____.
(b) Description of such indebtedness:
(1) The largest total amount of indebtedness at any time
during such period:
(2) The nature of the indebtedness and of the
transaction in which it was incurred:
(3) The amount thereof outstanding as of the end of the
Company's last fiscal year:
(4) The rate of interest paid or charged thereon:
18. Material Transactions With Company
During the Company's last three fiscal years and the period since
the end of the last fiscal year, I have not, nor has any associate (see
definition) of mine, engaged in, nor do I or any such associate have or propose
to engage in, any transaction or series of transactions to which the Company was
or is to be a party, in which I or my associate did or will have any material
(see definition) interest, direct or indirect, except as stated below.
If any such transaction involved or is to involve the purchase or
sale of assets by or to the Company or any of its subsidiaries, other than in
the ordinary course of business, the cost of the assets of the purchaser and the
cost thereof to the seller if acquired by the seller within two years prior to
the transaction is stated below.
Note: Examples of possible interest which must be disclosed are: I
or any of my " associates" (1) has been, is now, or proposes to be an officer,
director or employee of a major creditor, customer or supplier of the company or
any of its subsidiaries or has an interest in any such creditor, customer or
supplier; (2) is a seller, buyer, lessee or lessor of property to or from the
Company or any of its subsidiaries; (3) is the lender or guarantor of a loan
made to, or is a borrower from, the Company or any of its subsidiaries; (4) is
the debtor under an obligation which the Company or any of its subsidiaries
guarantees; (5) is a buyer of securities or evidences of indebtedness from the
Company or any of its subsidiaries. If applicable, the name of any such
associate and the nature of my relationship with such associate has been included.
(a) No exception _____.
(b) Exception _____. Description:
19. Indemnification
To the best of my knowledge, except as described below, no director
or officer of the Company is insured or indemnified in any manner against any
liability which he may incur in his capacity as such, other than pursuant to a
statutory provision or by-law, except as indicated below:
(a) I know of no such insurance or indemnification arrangement
_____.
(b) I am aware of such an insurance or indemnification
arrangement _____. Description:
20. Identity of Associates The full name, form (e.g., partnership,
corporation, etc.), nature of business done by, and principal place of business
of each associate (see definition) of mine referred to in the answers to this
questionnaire and my relationship with such associate are as follows, if applicable:
(a) Not applicable _____.
(b) Applicable _____. Description:
21. Present and Prior Legal Proceedings and Investigations (a) Respondent. Except as described below, the following
statements with respect to me are accurate as to the past five years:
(1) No petition under the federal bankruptcy laws or any
state insolvency law has been filed by or against, and no receiver, fiscal agent
or similar officer has been appointed by a court for the business or property of
(a) myself, (b) any partnership in which I was a general partner at or within
two years before the time of such filing, or (c) any corporation or business
association of which I was an executive officer at or within two years before
the time of such filing;
(2) I have not been convicted in a criminal proceeding
(excluding traffic violations and other minor offenses), nor am I the subject of
any criminal proceeding which is presently pending;
(3) I have not been the subject of any order, judgment
or decree, not subsequently reversed, suspended or vacated, of any court of
competent jurisdiction, permanently or temporarily enjoining me from or
otherwise limiting me, in the following activities:(A) Acting as a futures commission merchant,
introducing broker, commodities trading advisor, community pool operator, floor
broker, leverage transaction merchant, any other person or activity regulated by
the Commodity Futures Trading Commission, or an associated person (see
definitions) of any of the foregoing, or as an investment advisor, underwriter,
broker or dealer in securities, or as an affiliated person, director or employee
of any investment company, bank, savings and loan association or insurance
company, or engaging in or continuing any conduct or practice in connection with
such activity;
(B) Engaging in any type of business practice; or
(C) Engaging in any activity in connection with
the purchase or sale of any security or commodity or in connection with any
violation of federal or state securities laws or federal commodities laws.
(4) I have not been the subject of any order, judgment
or decree, not subsequently reversed, suspended or vacated, of any federal or
state authority barring, suspending or otherwise limiting for more than sixty
days my right to engage in any activity described under subsection (3) above or
to be associated with persons engaged in any such activity.
(5) I have not been found by a court of competent
jurisdiction in a civil action or by the Securities and Exchange Commission to
have violated any federal or state securities law except where the judgment in
such civil action or the finding by the Commission has been subsequently
reversed, suspended or vacated; nor am I subject to any current inve
stigation by the Securities and Exchange Commission.
(6) I have not been found by a court of competent
jurisdiction in a civil action or by the Commodities Futures Trading Commission
to have violated any federal commodities law, except in a judgment in such civil
action or finding by the Commodities Futures Trading Commission which has been
subsequently reversed, suspended or vacated; nor am I subject to any current
investigation regarding any alleged violation of any federal commodities law.
(1) No exception _____.
(2) Exception _____. Description:
(b) Promoters and control persons. If I am a promoter (see
definition) or control person (see definition), to the best of my knowledge, the
statements set forth in paragraphs (a)(1) through (a)(6) of this question are
also accurate with respect to any promoters (see definition) or control persons
(see definition) of the Company as to the past five years.
(1) No exception _____.
(2) Exception _____. Description:
22. Board of Directors and Committees of Board of Directors
(a) I am _____ / am not _____ a director.
(b) During the last fiscal year I attended _____ meetings of
the Board of Directors, of a total of _____ meetings held.
(c) I am aware of the existence of the following committees of
the Board of Directors of the Company:
(d) I am a member of the following committees of the Board of
Directors of the Company:
23. Foreign Corrupt Practices Act
In my response to this Question, the following instructions apply:
(1) Each question is to be read as relating to the activities
or conduct of the Company, its subsidiaries and any affiliate of the foregoing,
as well as to the conduct of any person who has acted or is acting on behalf of
or for the benefit of any of them. Persons who have acted or are acting on
behalf of or for the benefit of any entity include, but are not necessarily
limited to, directors, officers, employees, agents, consultants and sales representatives.
(2) Each question is to be read as relating not only to
activities or conduct within the United States, but outside the United States as well.
(3) The terms "payments" and "contributions" include not only
the giving of cash or hard goods but also the giving of anything else of value-
for example, services or the use of property.
(4) The term "indirectly" means an act done through an
intermediary. Payments to sales agents or representatives which are passed on in
whole or in party to purchasers, or compensation or reimbursement to persons in
consideration for their acts, are examples of acts done through intermediaries.
(5) My answers include not only matters of which I have direct
personal knowledge, but also any matters which I have reason to believe may have
existed or occurred (for example, I may not "know" of my own personal knowledge
that contributions were made by the Company to a political party in a foreign
land, but, based upon information which has otherwise come to my attention, I
may nonetheless have "reason to believe" that such a contribution was made. In
such case, my response would be "yes".) I have no knowledge or reason to believe that any of the
activities or types of conduct enumerated below have been or may have been
engaged in, either directly or indirectly, at any time since _____, _____:
(a) Any bribes or kickbacks to government officials or
their relatives, or any other payments to such persons, whether or not legal, to
obtain or retain business or to receive favorable treatment with regard to business.
No exception _____
Exception _____
(b) Any bribes or kickbacks to persons other than
government officials, or to relatives of such persons, or any other payments to
such persons or their relatives, whether or not legal, to obtain or retain
business or to receive favorable treatment with regard to business.
No exception _____
Exception _____
(c) Any contributions, whether or not legal, made to any
political party, political candidate or holder of governmental office.
No exception _____
Exception _____
(d) Any bank accounts, funds or pools of funds created
or maintained without being reflected on the corporate books of account, or as
to which the receipts and disbursements there from have not been reflected on
such books.
No exception _____
Exception _____
(e) Any receipts or disbursements, the actual nature of
which has been "disguised" or intentionally misrecorded on the corporate books
of account.
No exception _____
Exception _____
(f) Any fees paid to consultants or commercial agents
which exceeded the reasonable value of the services purported to have been rendered.
No exception _____
Exception _____
(g) Any payments or reimbursements made to personnel of
the Company for the purposes of enabling them to expend time or to make
contributions or payments of the kind or for the purpose referred to in subparts
(a)-(f) above.
No exception _____
Exception _____
The following is a description of all transactions for which I have
checked "Exception":
24. Reports or Studies on Company
I do not know of (a) any engineering, management or similar report
or memorandum relating to broad aspects of the business, operations or products
of the Company which has been prepared within the last twelve months for or by
the Company, any holder of more than 5% of the Company's Common Stock, or any
underwriter (see definition) or (b) any report or memorandum other than the
Memorandum which has been prepared for external use by the Company in connection
with the proposed offering, except as follows:
(1) I know of no such report or memorandum _____.
(2) I am aware of such a report or memorandum _____.
Description:
25. Certain Business Relationships
Except as set forth below, none of the following relationships
exist, or have existed at any time during the Company's last three fiscal years
or the period since the end of the last fiscal year:
(1) Service by me as an executive officer or director of, or
ownership by me, of record or beneficially, of in excess of a ten percent (10%)
equity interest in, any business or professional entity that has made during any
of the Company's last three fiscal years, or proposes to make during the
Company's current fiscal year, payments to the Company or its subsidiaries for
property or services in excess of five percent (5%) of (a) the Company's
consolidated gross revenues for any of its last three fiscal years, or (b) the
other entity's consolidated gross revenues for any of its last three fiscal years;
(2) Service by me as an executive officer or director of, or
ownership by me, of record or beneficially, of in excess of a ten percent (10%)
equity interest in, any business or professional entity to which the Company or
its subsidiaries has made during any of the Company's last three fiscal years,
or proposes to make during the Company's current fiscal year, payments for
property or services in excess of five percent (5%) of (a) the Company's
consolidated gross revenues for any of its last three fiscal years, or (b) the
other entity's consolidated gross revenues for any of its last three fiscal years;
(3) Service by me as an executive officer or director of, or
ownership by me, of record or beneficially, of in excess of a ten percent (10%)
equity interest in, any business or professional entity to which the Company or
its subsidiaries was indebted at the end of any of the Company's last three
fiscal years in an aggregate amount in excess of five percent (5 %) of the
Company's total consolidated assets at the end of such fiscal year;
(4) Any other relationships between myself and the Company
that are substantially similar in nature and scope to those relationships listed
in paragraphs
(1) and (3).
(a) No exception _____.
(b) Exception _____. I have described below such
relationship, indicating the identity of the entity with which the Company has
such a relationship, the nature of my affiliation with such entity, the
relationship between such entity and the Company and the amount of the business
done between the Company and the entity during the Company's last three fiscal
years or proposed to be done during the Company's current fiscal year.
26. Affiliation with Accountants and Counsel
I am not now and have never been interested in or affiliated or
connected with the firms of _____; the Company's auditors; or the placement
agent's legal counsel; or any other law firm or accounting firm that has been
retained by the Company during the last three fiscal years or is proposed to be
retained by the Company, except as follows:
(a) No exception _____.
(b) Exception _____. Description:
27. Transactions with Placement Agent
Except as described below, neither I nor any associate (see
definition) of mine has a material relationship (see definition) with any of the
representatives of the placement agent or with any other investment firm.
(a) No exception _____.
(b) Exception _____. Description:
28. Arrangements Regarding Sale of Securities
To the best of my knowledge I know of no arrangement made or to be
made by any person, or any transaction already effected:
(1) to limit or restrict the sale of the Common Stock during
the period of the offering of the Series A Preferred Stock pursuant to this Memorandum;
(2) to stabilize the market for the Series A Preferred Stock;
or
(3) to withhold commissions or otherwise to hold each
underwriter or dealer responsible for the distribution of his participation in
the offering.
(a) I known of no such arrangement or transaction. ____
(b) I am aware of such an arrangement or transaction.
_____ Description:
29. Contracts With the Company
Neither I nor any of my associates (see definition) is a party to
any contract with the Company or any of its subsidiaries, or in which the
Company or any subsidiary has a beneficial interest, or to which the Company or
any of its subsidiaries has succeeded by assumption or assignment, which is to
be performed in whole or in part at or after _____, 199_____ or which was made
not more than two years prior thereto, except as set forth below:
(a) No exception _____.
(b) Exception _____. Description: ____________________________
I understand that material misstatements or the omission of material
facts in the Memorandum may give rise to civil and criminal liabilities to the
Company and to each officer and director of the Company. Except as set forth in
my answers to this questionnaire, the Memorandum, which I acknowledge that I
have carefully read in full, does not, to the best of my knowledge, contain any
misstatement of material fact nor does it fail to state any material fact
required to be stated therein or necessary to make the statements therein not
misleading, except as noted below.
(a) No exception __________________________________.
(b) Exception _____________________________ Describe:
I confirm that the foregoing statements are correct, to the best of
my knowledge and belief.
Dated: _____.
Very truly yours, ______________________________
Definitions The term "arrangement" means any plan, contract, authorization or
understanding, whether or not set forth in a formal document.
The term "associate," as used throughout this questionnaire, means (1) any
corporation or organization (other than the Company or any of its subsidiaries)
of which I am an officer, director or partner or of which I am, directly or
indirectly, the beneficial owner of 5% or more of any class of equity
securities, (2) any trust or other estate in which I have a substantial
beneficial interest or as to which I serve as trustee or in a similar capacity,
(3) my spouse, (4) any relative of my spouse or any relative of mine who has the
same home as or who is a director or officer or key executive of the Company or
any of its subsidiaries, (5) any partner, syndicate member or person with whom I
have agreed to act in concert with respect to the acquisition, holding, voting
or disposition of shares of the Company's securities.
The term "beneficially," when used in connection with the ownership of
securities, means (1) any interest in a security which entitles me to any of the
rights or benefits of ownership even though I may not be the owner of record or
(2) securities owned by me directly or indirectly, including those held by me
for my own benefit (regardless of how registered) and securities held by others
for my benefit (regardless of how registered), such as by custodians, brokers,
nominees, pledgees, etc., and including securities held by an estate or trust in
which I have an interest as legatee or beneficiary, securities owned by a
partnership of which I am a partner, securities held by a personal holding
company of which I am a stockholder, etc., and securities held in the name of my
spouse, minor children and any relative (sharing the same home). A "beneficial
owner" of a security includes any person who, directly or indirectly, through
any contract, arrangement, understanding, relationship or otherwise has or shares:
(1) voting power which includes the power to vote, or to direct the
voting of, such security; and/or
(2) investment power which includes the power to dispose, or to
direct the disposition, of such security.
The term "control" means the possession, directly or indirectly, of the
power to direct or cause the direction of the management and policies of a
person, whether through the ownership of voting securities, by contract or
otherwise. A "control person" of a specified person is a person that directly,
or indirectly through one or more intermediaries, controls the person specified.
The term "family relationship" means any relationship by blood, marriage
or adoption, not more remote than first cousin.
The term "material," when used in this questionnaire to qualify a
requirement for the furnishing of information as to any subject, limits the
information required to those matters as to which an average prudent investor
ought reasonably to be informed before purchasing the Common Stock of the Company.
The term "material relationship" has not been defined by the Securities
and Exchange Commission. However, the Commission has indicated that will
probably construe as a "material relationship" any relationship which tends to
prevent arms length bargaining in dealings with a company, whether arising from
a close business connection or family relationship, a relationship of control or
otherwise. It seems prudent, therefore, to consider that I would have such a
relationship, for example, with any organization of which I am an officer,
director, trustee or partner or in which I own, directly or indirectly, 10% or
more of the outstanding voting stock, or in which I have some other substantial
interest, and with any person or organization with whom I have, or with whom any
relative or spouse (or any other person or organization as to which I have any
of the foregoing other relationships) has, a contractual relationship. The term
"Phantom Stock" means units whose value is determined by reference to the fair
market value of the Company's Common Stock.
The term "plan" includes all plans, contracts, authorizations or
arrangements, whether or not set forth in any formal document.
The term "promoter" includes:(1) Any person who, acting alone or in conjunction with one or more
other persons, directly or indirectly takes initiative in founding and
organizing the business or enterprise of an issuer; or
(2) Any person who, in connection with the founding and organizing
of the business or enterprise of an issuer, directly or indirectly receives in
consideration of services or property, or both services and property, 10% or
more of any class of securities of the issuer or 10% or more of the proceeds
from the sale of any class of such securities. However, a person who receives
such securities or proceeds either solely as underwriting commissions or solely
in consideration of property shall not be deemed a promoter within the meaning
of this paragraph if such person does not otherwise take part in founding and
organizing the enterprise.
The term "Stock Options" includes all options, warrants, or rights to
purchase securities of the Company or any of its subsidiaries, other than those
issued to security holders as such on a pro rata basis. The term "subsidiary"
means a corporation controlled by the Company directly or indirectly through one
or more intermediaries.
The term "Restricted Stock" means any stock awarded by the Company which
is subject to vesting based upon lapse of time, continued service with the
Company or a subsidiary and/or attainment of performance-based conditions or milestones.
