Exhibit 10.25


 


RESTRICTED STOCK AGREEMENT


PURSUANT TO THE


AMENDED AND RESTATED


NETSPEND HOLDINGS, INC.


2004 STOCK OPTION AND RESTRICTED STOCK PLAN


 


1.             General.  Pursuant to the Amended and Restated NetSpend
Holdings, Inc. 2004 Stock Option and Restricted Stock Plan (the “Plan”),
Restricted Stock shall be issued to Charles Harris (the “Participant”),
effective as of July 1, 2010 (the “Grant Date”) as hereinafter
provided subject to certain restrictions thereon.  The Restricted Stock shall be issued to the
Participant upon acceptance hereof by the Participant of the conditions of this
Restricted Stock Agreement.  Capitalized
terms used in this Restricted Stock Agreement and not defined herein shall have
the meanings ascribed to them in the Plan. 
This Restricted Stock Agreement and the Restricted Stock to which it
relates are subject to the terms and conditions of the Plan, a copy of which is
attached hereto.  If there is any
conflict between the terms and conditions of the Plan and this Restricted Stock
Agreement, the terms and conditions of Plan, as interpreted by the Committee,
shall govern.


 


2.             Number of Shares of
Restricted Stock.  This
Restricted Stock Agreement shall represent the grant of 406,250 shares of
Common Stock (the “Restricted Stock”).


 


3.             Vesting of Restricted Stock.


 


(a)           General Vesting Schedule.  The Restricted Stock shall become vested in
four equal annual installments on each of the first four anniversaries of the
Effective Date (as defined in the Employment Agreement by and between NetSpend
Corporation and the Participant, dated as of June 1, 2010) (the “Employment
Agreement”), subject to the Participant’s continued employment with the
Company or an Affiliate through the applicable vesting date.


 


(b)           Change in Control Vesting.


 


(i)            Section 10(b)(iv) of the Plan shall not apply to the shares of
Restricted Stock granted under this Agreement. 
Instead (and notwithstanding the vesting schedule described in
subsection (a) above), the following vesting provisions shall apply:  In the event of a Change in Control, fifty
percent (50%) of the shares of Restricted Stock will immediately vest (subject
to the Participant’s continued employment with the Company or an Affiliate
through the date of the Change in Control). 
Further, in the event that (a) a Change in Control occurs and (b) during
the twelve-month period  following
such Change in Control, the Participant’s employment is terminated by the
Company or an Affiliate for any reason other than for (i) Cause or (ii) Disability,
or the Participant terminates his employment during this twelve-month period
for Good Reason (as defined in the Employment Agreement), then 100% of the
shares of Restricted Stock shall be vested immediately.  For purposes of
clarification, in the event of a termination of the Participant’s employment by
the Company or an Affiliate for Cause or Disability, by the
Participant for any reason other than Good Reason, or in the event of
the


 

















 


Participant’s death, the
unvested shares of Restricted Stock shall not be vested pursuant to the
preceding sentence.


 


(ii)           In the event of a Change of Control whereby all of the capital stock of
the Company (including, without limitation the Common Stock of the Company and
the Restricted Stock hereunder) is exchanged, redeemed, converted or otherwise
reclassified, notwithstanding the form of Corporate Transaction, into the right
to receive the equity securities or other property (other than cash) of the
surviving, successor or purchasing corporation, or a parent or subsidiary
thereof in such Change of Control (as applicable, the “Purchasing
Corporation”), then, and in each such case, as part of such Change of
Control, provision shall be made so as to allow the Participant to receive,
subject to the vesting terms and other provision hereof, the number of shares
of equity securities or such other property of the Purchasing Corporation as
would any holder of shares of Common Stock of the Company receive upon the
closing of such Change of Control.  The
foregoing shall similarly apply to any successive Change of Control.  If the per-share consideration payable to any
holder of shares of Common Stock of the Company in connection with any such
transaction is in a form other than cash or marketable securities, then (to the
extent necessary to implement the provisions of this subsection (ii)) the value
of such consideration  shall be as
determined in the documents governing the Change of Control.  In the event of a Change of Control whereby
all of the capital stock of the Company is exchanged, redeemed, converted or
otherwise reclassified, notwithstanding the form of Corporate Transaction, into
the right to receive cash consideration for each share thereof (including,
without limitation, for each share of Restricted Stock hereunder), and
provision is not made for the Purchasing Corporation to substitute shares of
its capital stock for the remaining unvested shares of Restricted Stock
hereunder so as to allow Participant to retain substantially (subject to
vesting) the same terms and substantially the same value applicable to the
Restricted Stock as of the closing of the Change of Control, then provision
shall be made for an amount of cash equal to the cash value of the unvested
shares of Restricted Stock as of the closing of the Change of Control to be
held by the Purchasing Corporation, subject to the vesting provisions contained
herein.  That is, such cash amounts shall
be paid to Participant on each applicable vesting date hereunder (with respect
to the number of shares of Restricted Stock that would have vested as of such
date and subject to the vesting conditions hereunder), including, without
limitation, any accelerated vesting date contemplated by this Section 3(b).


 


4.             Participants’
Representations and Warranties.  The Participant shall complete the Investment
Representation Statement attached hereto as Exhibit A, which is a
condition to the Participant’s receipt of this Award of Restricted Stock.


 


5.             Transferability;
Certificates.


 


(a)           Prior to an Initial Public Offering, no Restricted Stock, may be
transferred or disposed of in any way by the Participant, except by will or by
the laws of descent and distribution or pursuant to this Restricted Stock
Agreement.  References to “Participant”
shall include persons who acquire any interest in Restricted Stock under Section 7
of this Restricted Stock Agreement.


 


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(b)           A certificate evidencing the Restricted Stock shall be issued by the
Company in Participant’s name pursuant to which the Participant shall have
voting and dividend  rights unless
and until the shares of Restricted Stock are canceled or forfeited pursuant to
the provisions of this Restricted Stock Agreement.  Notwithstanding the foregoing, dividends
issued with respect to unvested shares of Restricted Stock shall be held in a
suspense account until the underlying shares vest, and shall be forfeited upon
the date of the Participant’s Termination of Service if the underlying shares
of Restricted Stock have not vested as of such date (or in connection with such
date).  The certificate shall bear a
legend, substantially in the following form, evidencing the nature of the
Restricted Stock, and the Company may cause the certificate to be delivered
upon issuance to the Board  or such
other depository as may be designated by the Company as a depository for
safekeeping until the cancellation or forfeiture occurs or the vesting period
ends pursuant to the terms of the Plan and this Restricted Stock Agreement.


 


THE
SALE AND ISSUANCE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR
UNDER THE SECURITIES LAW OF ANY STATE OR OTHER JURISDICTION.  THESE SECURITIES HAVE BEEN ACQUIRED FOR
INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE DISTRIBUTION
THEREOF.  THESE SECURITIES MAY NOT
BE OFFERED, SOLD, PLEDGED, OR TRANSFERRED UNLESS (I) A REGISTRATION
STATEMENT UNDER THE ACT IS IN EFFECT AS TO THESE SECURITIES AND SUCH OFFER,
SALE, PLEDGE, OR TRANSFER IS IN COMPLIANCE WITH APPLICABLE SECURITIES LAW OF
ANY STATE OR OTHER JURISDICTION OR (II) THERE IS AN OPINION OF COUNSEL OR
OTHER EVIDENCE, IN EITHER CASE, SATISFACTORY TO THE CORPORATION, THAT AN
EXEMPTION THEREFROM IS AVAILABLE AND THAT SUCH OFFER, SALE, PLEDGE, OR TRANSFER
IS IN COMPLIANCE WITH THE ACT AND APPLICABLE SECURITIES LAW OF ANY STATE OR
OTHER JURISDICTION.


 


TRANSFER
OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE IS SUBJECT TO THE CONDITIONS
SPECIFIED IN AN AWARD AGREEMENT BETWEEN THE ISSUER AND A PARTICIPANT IN THE
ISSUER’S AMENDED AND RESTATED 2004 STOCK OPTION AND RESTRICTED STOCK PLAN.  NO TRANSFER OF THE SECURITIES REPRESENTED BY
THIS CERTIFICATE SHALL BE VALID OR EFFECTIVE UNTIL SUCH CONDITIONS HAVE BEEN
FULFILLED.  SUCH AGREEMENTS MAY BE
INSPECTED AT THE PRINCIPAL EXECUTIVE OFFICES OF THE ISSUER.


 


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(c)           Upon request of the Committee or its delegate, the Participant shall
deliver to the Company a stock power, endorsed in blank, relating to the
Restricted Stock with respect to which the vesting period has not expired.  Notwithstanding any other provisions of this
Restricted Stock Agreement, the issuance or delivery of any Restricted Stock
(whether subject to restrictions or unrestricted) may be postponed for such
period as may be required to comply with applicable requirements of any
national securities exchange or any requirements under any law or regulation
applicable to the issuance or delivery of such Restricted Stock.  The Company shall not be obligated to issue
or deliver any Stock if the issuance or delivery thereof shall constitute a
violation of any provision of any law or of any regulation of any governmental
authority or any national securities exchange.


 


(d)           IPO Lock-Up and Company Repurchase Rights.  For the avoidance of doubt,
Sections 9(e) of the Plan (Company Repurchase Right) and Section 12
of the Plan (IPO Lock-Up) apply to the shares of Restricted Stock.


 


(e)           Prohibited Transfers.  Notwithstanding any provisions in this
Restricted Stock Agreement to the contrary, all shares of Restricted Stock
shall be subject to the transfer restrictions set forth in Section 9(f) of
the Plan.  If any purported Transfer is
made or attempted contrary to the provisions of this Restricted Stock
Agreement, such purported Transfer shall be void ab initio; the Company, and its stockholders shall have,
in addition to any other legal or equitable remedies which they may have, the
right to enforce the provisions of this Restricted Stock Agreement by actions
for specific performance (to the extent permitted by law); and the Company
shall have the right to refuse to recognize any Transferee as one of its
stockholders for any purpose.  For the
avoidance of doubt, the Participant shall not Transfer any shares of Restricted
Stock that have not vested pursuant to Section 3 hereof.


 


6.             Mandatory Participation in
Sale of the Company.


 


(a)           Sale of the Company and/or Its Subsidiaries.


 


(i)            Conditions.  So long as Oak continues to hold at least a
majority of the Common Stock held by it on the effective date of the Plan, if
Oak determines to pursue the sale of the business of the Company and/or its
Subsidiaries to a third party that is not (i) an Affiliate of Oak or (ii) a
Person in which Oak or an Affiliate of Oak holds a direct or indirect equity
interest (other than a ownership interest of less than 5% of the outstanding
capital stock of a public company) or any other material interest (as a
creditor or otherwise) (a “Third Party Purchaser”) in a bona fide arms’
length transaction (whether by way of a merger, consolidation, sale of all or
substantially all of its assets, sale of outstanding capital stock or
otherwise) (an “Approved Sale”), then, subject to the provisions of
subsection (b) of this Section 6:


 


(A)          the Participant shall, subject to the conditions set forth in subsection
(c), consent to, vote for, and raise no objections against, and waive
dissenters and appraisal rights (if any) with respect to, the Approved Sale,


 


(B)           if the Approved Sale is structured as a sale of stock, the Participant
will agree to sell and will be permitted to sell all of the shares of
Restricted Stock upon the terms and conditions approved by Oak, and


 


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(C)           if the Approved Sale includes the sale, contribution, exchange,
redemption, cancellation or other disposition of Common Stock, the Participant
will sell, contribute, exchange, redeem, cancel or otherwise dispose of the
Restricted Stock on the terms and conditions approved by Oak.


 


The
Participant will take all reasonably necessary and desirable actions to
consummate such Approved Sale, including, without limitation, the execution of
all agreements and other instruments and such other actions reasonably
necessary to effectuate the allocation and distribution of the aggregate
consideration upon the Approved Sale as set forth in subsection (b) below.


 


(b)           Approved Sale Obligations.  The obligations of the Participant with
respect to an Approved Sale are subject to the satisfaction of the conditions
that:


 


(i)            the
proceeds of the Approved Sale are applied in accordance with the Company’s
Certificate of Incorporation as in effect immediately prior to such Approved
Sale;


 


(ii)           each
holder of shares of capital stock of the Company shall receive the same
proportion of the aggregate consideration from such Approved Sale that such
holder would have received if such aggregate consideration had been distributed
by the Company in complete liquidation pursuant to the rights and preferences
set forth in the Company’s Certificate of Incorporation as in effect
immediately prior to such Approved Sale and no holder of any shares of capital
stock of the Company shall receive any consideration of any kind from the
purchaser or any of its Affiliates other than such proportionate consideration
(except in respect of such holder’s employment with the Company and other
matters personal to such holder);


 


(iii)          upon
the consummation of the Approved Sale, all of the holders of Common Stock will
receive the same form and amount of consideration per share of each such class
of Common Stock;


 


(iv)          if
any holder of Common Stock is given an option as to the form and amount of
consideration to be received, all holders of the same class or series of stock
will be given the same option;


 


(v)           the Participant shall not be required to make any representations or
warranties other than representations and warranties about the Company and its
business, operations, liabilities and the like that are required by all
Stockholders, in which case, the indemnification obligations of the Participant
with respect to any such representations and warranties provided for in this
clause (v) shall be limited to the Participant’s pro rata portion thereof
(based upon the share ownership of all Stockholders).


 


(c)           Definitions.


 


(i)            “Initial
Public Offering” means the first firm commitment underwritten public
offering for shares of Common Stock pursuant to an effective registration
statement under the Securities Act with aggregate gross proceeds of at least
$25,000,000.


 


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(ii)           “Oak”
means Oak Investment Partners X, Limited Partnership and/or Oak X Affiliates
Fund, L.P.


 


(iii)          “Permitted
Transfer” shall mean any Transfer permitted under this Agreement or the
Plan.


 


(iv)          “Permitted
Transferee” shall mean any Transferee of a Participant permitted under this
Agreement or the Plan.


 


(v)           “Stockholder”
and “Stockholders” shall have the meaning set forth in the Preamble.


 


(vi)          “Transfer” means any direct or indirect transfer, donation, sale, assignment,
pledge, hypothecation, grant of a security interest in or other disposal of all
or any portion of a Security or of any rights thereunder.  “Transferred” means the accomplishment
of a Transfer, and “Transferee” means the recipient of a Transfer.


 


7.             Notices.  All notices or other communications which are
required or permitted hereunder shall be in writing and sufficient if (i) personally
delivered, (ii) sent by nationally-recognized overnight courier or (iii) sent
by registered or certified mail, postage prepaid, addressed as follows:


 


if
to the Participant, to the address set forth on the signature page hereto;
and


 


if
to the Company, to:


 


NetSpend
Holdings, Inc.


c/o
NetSpend Corporation


Austin
Centre


701
Brazos Street, 12th Floor


Austin,
TX  78701


Attention:  Chief Financial Officer


 


or
to such other address as the party to whom notice is to be given may have
furnished to each other party in writing in accordance herewith.  Any such communication shall be deemed to
have been given (x) when delivered, if personally delivered, (y) on
the first Business Day (as hereinafter defined) after dispatch, if sent by
nationally-recognized overnight courier and (z) on the third Business Day
following the date on which the piece of mail containing such communication is
posted, if sent by mail.  As used herein,
“Business Day” means a day that is not a Saturday, Sunday or a day on which
banking institutions in the city to which the notice or communication is to be
sent are not required to be open.


 


8.             No Waiver.  No
waiver of any breach or condition of this Agreement shall be deemed to be a
waiver of any other or subsequent breach or condition, whether of like or
different nature.


 


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9.             Participant Undertaking.  The Participant
hereby agrees to take whatever additional actions and execute whatever
additional documents the Company may in its reasonable judgment deem necessary
or advisable in order to carry out or effect one or more of the obligations or
restrictions imposed on the Participant pursuant to the express provisions of
this Agreement.


 


10.           Successors and Assigns.  Except
as otherwise provided herein, this Agreement shall bind and inure to the
benefit of and be enforceable by the Participant and the Company and their
respective successors, assigns, heirs, representatives and estates, as the case
may be (including subsequent holders of shares of Restricted Stock); provided,
however, that the rights and obligations of the Participant under this
Agreement shall not be assignable except in connection with a Permitted
Transfer of shares of Restricted Stock hereunder (so long as the transferee
agrees in writing in advance to become bound by the terms and conditions
hereof).


 


11.           Modification of Rights.  The
rights of the Participant are subject to modification and termination in
certain events as provided in this Agreement and the Plan.


 


12.           Governing Law.


 


(a)           This
Agreement shall be deemed to be a contract made under, and shall be construed
in accordance with, the laws of the State of Delaware, without giving effect to
conflict of laws principles thereof.


 


(b)           Each
of the parties hereto hereby irrevocably and unconditionally submits, for
himself or herself and his or her property, to the nonexclusive jurisdiction of
any Delaware State court or any federal court of the United States of America
sitting in the State of Delaware, and any appellate court from any thereof, in
any action or proceeding arising out of or relating to this Agreement or for
recognition or enforcement of any judgment, and each of the parties hereto
hereby irrevocably and unconditionally agrees that all claims in respect of any
such action or proceeding may be heard and determined in any such Delaware
State court or, to the extent permitted by law, in any such federal court.  Each of the parties hereto agrees that a
final judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law.


 


(c)           Each
of the parties hereto irrevocably and unconditionally waives, to the fullest
extent that he or she may legally and effectively do so, any objection that he
or she may now or hereafter have to the laying of venue of any suit, action or
proceeding arising out of or relating to the Agreement in any Delaware state or
federal court sitting in the State of Delaware. 
Each of the parties hereto irrevocably waives, to the fullest extent
permitted by law, the defense of an inconvenient forum to the maintenance of
such action or proceeding in any such court.


 


13.           Counterparts.  This
Agreement may be executed in one or more counterparts, each of which shall be
deemed to be an original, but all of which together shall constitute one and
the same instrument.


 


14.           Entire Agreement.  This Agreement, the Plan and the
Investment Representation Statement, constitute the entire agreement between
the parties with respect to the subject matter


 


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hereof,
and supersede all previously written or oral negotiations, commitments,
representations and agreements with respect thereto.


 


15.           Withholding.  The Participant shall pay to the Company, or
make arrangements satisfactory to the Company, regarding the payment of any
Federal, state, local or foreign taxes of any kind required by law to be
withheld with respect to the Restricted Stock upon vesting. Certificates shall
not be delivered to the Participant, and the Restricted Stock shall be
forfeited, unless the Participant has made arrangements satisfactory to the
Committee to satisfy tax-withholding obligations.  Unless otherwise determined by the Board
(which determination shall only be made for purposes of complying with
applicable law or stock exchange requirements, or as necessary to preserve the
intended accounting treatment of this Award of Restricted Stock), the minimum
statutorily required withholding obligations may be settled (at the election of
the Participant) with shares of Common Stock owned by the Participant,
including shares of Restricted Stock that gives rise to the withholding
requirement.  In the event the Committee
determines that the Participant will not be permitted to use Restricted Stock
to settle his withholding obligations, the Company shall use its commercially
reasonable best efforts to assist the Participant in structuring another manner
in which the Participant can satisfy his withholding obligations without being
required to submit a substantial lump-sum cash payment from his personal
savings.


 


16.           83(b) Election.  The Participant shall deliver to the Company a
copy of any election filed by the Participant with the Internal Revenue Service
under Section 83(b) of the Code within 30 days of the Grant Date.


 


17.           WAIVER OF JURY TRIAL.  NO PARTY TO THIS AGREEMENT OR ANY ASSIGNEE,
SUCCESSOR, HEIR OR PERSONAL REPRESENTATIVE OF A PARTY SHALL SEEK A JURY TRIAL
IN ANY LAWSUIT, PROCEEDING, COUNTERCLAIM OR ANY OTHER LITIGATION PROCEDURE
BASED UPON OR ARISING OUT OF THIS AGREEMENT. 
NO PARTY WILL SEEK TO CONSOLIDATE ANY SUCH ACTION, IN WHICH A JURY
TRIAL HAS BEEN WAIVED, WITH ANY OTHER ACTION IN WHICH A JURY TRIAL CANNOT OR
HAS NOT BEEN WAIVED.  THE PROVISIONS OF
THIS SECTION HAVE BEEN FULLY DISCUSSED BY THE PARTIES HERETO, AND THESE
PROVISIONS SHALL BE SUBJECT TO NO EXCEPTIONS. 
NEITHER PARTY HAS IN ANY WAY AGREED WITH OR REPRESENTED TO THE OTHER
PARTY THAT THE PROVISIONS OF THIS SECTION WILL NOT BE FULLY ENFORCED IN
ALL INSTANCES.


 


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IN
WITNESS WHEREOF, the parties have executed this Restricted Stock Agreement as
of the Grant Date.


 


	
   

  	
  NETSPEND
  HOLDINGS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/
  Daniel R. Henry

  
	
   

  	
  By:
  Daniel R. Henry

  
	
   

  	
  Title:
  Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  PARTICIPANT

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/
  Charles Harris

  
	
   

  	
  Name:

  	
  Charles
  Harris

  
	
   

  	
  Address:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  State
  of Residence:

  	
  California

  
				



 


 


One of the following two must be
fully executed.


 


Acknowledgment
and Agreement of Spouse


 


The
undersigned spouse of the Participant acknowledges that he or she has read this
agreement and agrees to be bound thereby to the extent that the Participant has
executed such document.


 


 


	
   

  	
   

  
	
  Name:

  	
   

  



 


Declaration
of Unmarried Status


 


I,
                                  ,
hereby declare that I am not married as of the date hereof.


 


	
   

  	
   

  
	
  Name:

  	
   

  



 


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EXHIBIT A


 


INVESTMENT REPRESENTATION STATEMENT


 


	
  PARTICIPANT:

  	
   

  	
  Charles
  Harris

  
	
   

  	
   

  	
   

  
	
  COMPANY

  	
  :

  	
  NetSpend
  Holdings, Inc.

  
	
   

  	
   

  	
   

  
	
  SECURITY

  	
  :

  	
  Class A
  Common Stock

  
	
   

  	
   

  	
   

  
	
  AMOUNT

  	
  :

  	
  406,250

  
	
   

  	
   

  	
   

  
	
  DATE

  	
  :

  	
  July 1,
  2010

  
				



 


In
connection with the acquisition of the above-listed Securities, the undersigned
Participant represents to the Company the following:


 


The Participant is aware
of the Company’s business affairs and financial condition and has acquired
sufficient information about the Company to reach an informed and knowledgeable
decision to acquire the Securities.  The
Participant is acquiring these Securities for investment for the Participant’s
own account only and not with a view to, or for resale in connection with, a “distribution”
thereof within the meaning of the Securities Act.


 


The Participant
acknowledges and understands that the Securities constitute “restricted
securities” under the Securities Act and have not been registered under the
Securities Act in reliance upon a specific exemption therefrom, which exemption
depends upon, among other things, the bona fide nature of the Participant’s
investment intent as expressed herein. 
In this connection, the Participant understands that, in the view of the
Securities and Exchange Commission, the statutory basis for such exemption may
be unavailable if the Participant’s representation was predicated solely upon a
present intention to hold these Securities for the minimum capital gains period
specified under tax statutes, for a deferred sale, for or until an increase or decrease
in the market price of the Securities, or for a period of one year or any other
fixed period in the future.  The
Participant further understands that the Securities must be held indefinitely
unless they are subsequently registered under the Securities Act or an
exemption from such registration is available. 
The Participant further acknowledges and understands that the Company is
under no obligation to register the Securities. 
The Participant understands that the certificate evidencing the Securities
will be imprinted with a legend which prohibits the transfer of the Securities
unless they are registered or such registration is not required in the opinion
of counsel satisfactory to the Company and other legends required under the
applicable state or federal securities laws.


 


The Participant is
familiar with the provisions of Rule 701 and Rule 144, each
promulgated under the Securities Act, which, in substance, permit limited
public resale of “restricted securities” acquired, directly or indirectly from
the issuer thereof, in a non-public offering subject to the satisfaction of
certain conditions.


 


In
the event that the Company does not become subject to the requirements of Section 13
or 15(d) of the Exchange Act, then the Securities may be resold in certain
limited circumstances


 

















 


subject
to the provisions of Rule 144, which requires the resale to occur not less
than one year after the later of the date the Securities were sold by the
Company or the date the Securities were sold by an affiliate of the Company,
within the meaning of Rule 144; and, in the case of acquisition of the
Securities by an affiliate only, the satisfaction of the following conditions: (1) the
resale being made through a broker in an unsolicited “broker’s transaction,” in
transactions directly with a market maker (as said term is defined under the
Exchange Act) or in “riskless principal transactions” (as said term is defined
in the Note to Rule 144(f)(1)); (2) the amount of Securities being
sold during any three month period not exceeding the limitations specified in Rule 144(e);
(3) the availability of certain public information about the Company; and (4) the
timely filing of a Form 144, if applicable.


 


In the event the Company
becomes subject to the reporting requirements of Section 13 or 15(d) of
the Exchange Act, then ninety (90) days thereafter (or such longer period as
any market stand-off agreement may require), Securities exempt under Rule 701
may be resold by non-affiliates in reliance on Rule 144, without
compliance with any of the conditions set forth in Rule 144, and
Securities exempt under Rule 701 may be resold by affiliates in reliance
on Rule 144, subject to the satisfaction of the conditions set forth in
the clauses (1) through (4) immediately above and without compliance
with any specified holding period requirement.


 


The Participant further
understands that in the event all of the applicable requirements of Rule 701
or Rule 144 are not satisfied, registration under the Securities Act,
compliance with Regulation A under the Securities Act, or some other
registration exemption will be required; and that, notwithstanding the fact
that Rules 144 and 701 are not exclusive, the Staff of the Securities and
Exchange Commission has expressed its opinion that a person proposing to sell
private placement securities other than in a registered offering and otherwise
than pursuant to Rules 144 or 701 will have a substantial burden of proof
in establishing that an exemption from registration is available for such
offers or sales, and that such persons and their respective brokers who
participate in such transactions do so at their own risk.  The Participant understands that no
assurances can be given that any such other registration exemption will be
available in such event.


 


The Participant further
represents and warrants that it comes within the category or categories marked
below, and that for any category marked, it can truthfully set forth the
factual basis or reason the investor comes within that category.  The undersigned agrees to furnish any
additional information which the Company deems necessary in order to verify the
answers set forth below.


 


o            (a)           The Participant is an
individual (not a partnership, corporation, etc.) whose individual net
worth, or joint net worth with his or her spouse, presently exceeds
US$1,000,000.


 


Explanation:  In calculating net worth you may include
equity in personal property and real estate, including your principal
residence, cash, short-term investments, stock and securities.  Equity in personal property and real estate
should be based on the appraised fair market value of such property less debt
secured by such property.


 


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o            (b)           The Participant is an
individual (not a partnership, corporation, etc.) who had an income in
excess of US$200,000 in each of the two most recent years, or joint income with
his or her spouse in excess of US$300,000 in each of those years (in each case
including foreign income, tax exempt income and full amount of capital gains
and losses but excluding any income of other family members and any unrealized
capital appreciation) and has a reasonable expectation of reaching the same
income level in the current year.


 


o            (c)           The Participant is a
director or executive officer of the Company.


 


o            (d)           The Participant is a
non-profit organization within the meaning of Section 501(c)(3) of
the Internal Revenue Code, corporation, business trust, partnership or limited
liability company, in each case not formed for the specific purpose of
acquiring the Securities and with total assets in excess of US$5,000,000.  If so, please describe entity:


 


o            (e)           The Participant is a trust
with total assets in excess of US$5,000,000, not formed for the specific
purpose of acquiring the Securities, where the purchase is directed by a “sophisticated
person” as defined in Rule 506(b)(2)(ii) of Regulation D under the
Securities Act.


 


o            (f)            The Participant is a
revocable grantor trust in which each of the grantors is an individual who (i) has
a net worth, either alone or with his or her spouse, of more than $1,000,000 or
(ii) had income in excess of $200,000 during each of the previous two
years and reasonably expects to have income in excess of $200,000 during the
current year, or joint income with his or her spouse in excess of $300,000
during each of the previous two years and reasonably expects to have joint
income in excess of $300,000 during the current year.


 


o            (g)           The Participant is an entity
(other than a trust) all the equity owners of which are “accredited investors”
within one or more of the above categories. 
If so, please describe entity:  (If relying upon this category alone, each equity owner must complete a
separate copy of this questionnaire.)


 


o            (h)           The Participant is not
within any of the categories above and is therefore a non-accredited investor.


 


	
   

  	
  Signature
  of Participant:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Date:
  July 1, 2010

  



 


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