Investment Agreement - Alabama

PRIVATE SECURITIES SUBSCRIPTION AGREEMENT (ALABAMA)

This Agreement is made as of [__/__/____] by:

• Company / Issuer: [________________________________]
• Jurisdiction and entity type: [________________________________]
• Principal address: [________________________________]
• Investor: [________________________________]
• Investor address: [________________________________]

1. Mandatory Offering Gate

The parties shall not use this Agreement to offer, sell, or issue a security until securities counsel completes Schedule 1 and identifies a current federal path and a current Alabama registration or exemption path.

Counsel must confirm before the first offer and again before each sale:

• ☐ the instrument is correctly classified and authorized under the Company's governing law and documents;
• ☐ a federal registration statement is effective or a specifically documented exemption applies;
• ☐ the security is registered in Alabama, is exempt under Ala. Code § 8-6-10, or the transaction is exempt under Ala. Code § 8-6-11;
• ☐ every person receiving transaction-based compensation or acting as a dealer or agent has been reviewed under federal and Alabama registration rules;
• ☐ the solicitation method matches the selected exemption;
• ☐ investor-count, accredited-status, sophistication, information, integration, resale, disqualification, notice, consent, and filing requirements are documented;
• ☐ offering disclosures are complete, current, and consistent across investors; and
• ☐ the Company's board, managers, members, or shareholders have approved the issuance as required by the governing documents and entity law.

No checked box or investor representation by itself establishes an exemption.

2. Security and Purchase Terms

Subject to the Closing conditions, Investor subscribes for and Company agrees to issue:

• Security type and class: [________________________________]
• Number / principal amount: [________________________________]
• Price per unit: [________________________________]
• Total purchase price: [________________________________]
• Governing instrument: [charter / operating agreement / note / SAFE / other: ________________________________]
• Closing date: [__/__/____]

The economic, voting, conversion, distribution, maturity, interest, liquidation, information, and transfer terms are only those stated in the attached governing instrument. This Agreement does not create unstated preferences, vetoes, inspection rights, redemption rights, or return guarantees.

3. Selected Federal Path

Schedule 1 controls. Select one only after counsel review:

• ☐ effective Securities Act registration statement;
• ☐ Securities Act § 4(a)(2), 15 U.S.C. § 77d(a)(2), with a written nonpublic-offering analysis;
• ☐ Rule 506(b), 17 C.F.R. § 230.506(b);
• ☐ Rule 506(c), 17 C.F.R. § 230.506(c); or
• ☐ another identified path: [________________________________].

Rule 506(b) Controls, If Selected

The compliance file must document the current purchaser-count rule, the status and sophistication of every purchaser, the information furnished to each non-accredited purchaser, the opportunity to ask questions, the solicitation policy, integration analysis, resale restrictions, and Rule 506(d) disqualification review.

Rule 506(c) Controls, If Selected

Every purchaser must be an accredited investor, and Company must retain the reasonable-verification record selected by securities counsel. A purchaser's unchecked or unsupported self-certification does not replace Company's verification duty.

Form D, If Rule 504 or Rule 506 Is Selected

Company shall assign responsibility for Form D in Schedule 4 and calendar the filing no later than 15 calendar days after the first sale, subject to the rule's weekend and holiday provision and amendment requirements.

4. Selected Alabama Path

Schedule 1 must identify one of the three Ala. Code § 8-6-4 routes: registration, an exempt security under § 8-6-10, or an exempt transaction under § 8-6-11. A federal exemption does not complete this Alabama analysis.

If counsel selects Ala. Code § 8-6-11(a)(9), the compliance file must address its current purchaser count, 12-month measurement period, investment-intent inquiry, written unregistered-security disclosure, certificate or instrument legend, solicitation-compensation restriction, and public-advertising or general-solicitation restriction.

Alabama notice, consent, fee, filing, purchaser-representative, or other conditions apply only if the selected Alabama path actually requires them. Schedule 4 must state each requirement and responsible person rather than relying on generic “blue sky compliance” language.

5. Offering Materials and Disclosures

Before Investor signs, Company shall deliver the materials listed in Schedule 2, including as applicable:

1. the governing instrument and capitalization table;
2. material financial statements and assumptions;
3. a description of the business, use of proceeds, material risks, conflicts, related-party transactions, and compensation paid in connection with the offering;
4. material contracts, debt, liens, litigation, regulatory matters, intellectual-property issues, and pending financings identified by counsel;
5. the selected federal and Alabama transfer restrictions and legends;
6. any information required for a non-accredited purchaser under Rule 502(b); and
7. material updates delivered before Closing.

Investor may submit written questions until [DATE/TIME]. Company shall answer accurately or state that it cannot supply the requested information. No oral statement modifies the written offering materials unless added by a signed amendment or written update delivered to all affected investors.

6. Closing

At Closing:

1. Investor shall pay the purchase price by the method in Schedule 3;
2. Company shall issue the Security in the form stated in Section 2;
3. Company shall deliver evidence of authorization and the completed disclosure schedules;
4. each required consent and pre-Closing filing shall have been completed; and
5. Company shall update the capitalization and ownership records.

If a Closing condition is not satisfied or waived in a signed writing by the party entitled to it, either party may terminate before Closing. Termination does not create a penalty, accelerated return, or damages formula unless Schedule 5 expressly provides one after counsel review.

7. Company Representations

Company represents at signing and Closing that, except as disclosed in Schedule 2:

1. it is duly organized and has approved execution and issuance through the action identified in Schedule 3;
2. the governing instrument attached to this Agreement states the rights of the Security;
3. the capitalization information delivered to Investor is accurate in all material respects as of its stated date;
4. Company has disclosed material written claims and proceedings known to it that concern the offering or would materially affect the disclosed use of proceeds;
5. Company has not knowingly given Investor a written statement that is materially false or misleading by omission in light of the circumstances in which it was made; and
6. Company will use the proceeds as described in Schedule 2, subject to any disclosed board-approved reallocation process.

No representation guarantees investment performance, liquidity, tax treatment, regulatory approval, a future financing, conversion, dividend, redemption, public offering, or exit.

8. Investor Representations

Investor represents at signing and Closing that:

1. Investor has authority to sign and fund the purchase;
2. Investor has reviewed the Security, governing instrument, offering materials, and risk disclosures;
3. Investor understands the Security may be restricted and illiquid and can bear the economic risk stated in the offering materials;
4. Investor is purchasing for its own account unless Schedule 6 identifies the beneficial owner or fiduciary capacity;
5. Investor has not relied on an undisclosed promise of return, liquidity, redemption, listing, or resale; and
6. the investor-status facts in Schedule 6 are complete and accurate.

Investor Status — Complete Only the Selected Path

• ☐ Accredited investor. Rule 501(a) category and supporting facts: [________________________________].
• ☐ Rule 506(b) non-accredited purchaser. Sophistication or purchaser-representative facts and disclosures received: [________________________________].
• ☐ Other status. Citation, selected exemption, and supporting facts: [________________________________].

Investor shall promptly notify Company before Closing if a material investor-status fact changes. Company remains responsible for the issuer-side reasonable-belief or verification work required by the selected exemption.

9. Transfer Restrictions

Investor shall not transfer the Security unless Company and securities counsel determine that the transfer is registered or fits a documented federal and Alabama exemption and satisfies the governing instrument. Company may request information and a counsel opinion reasonably related to that determination.

The Security shall carry only the legends approved for the selected federal and Alabama paths. Removal of a legend does not itself make a transfer lawful, and a legend must not claim that a registration or exemption analysis has been completed when it has not.

10. Securities-Law Savings

Nothing in this Agreement waives compliance with federal or Alabama securities law or limits liability that applicable law does not permit the parties to limit.

The parties shall not treat confidentiality, integration, nonreliance, indemnity, release, or damages language as permission to make a materially false statement or omit a material fact necessary to make a statement not misleading.

No automatic indemnity, investment-amount liability cap, punitive-damages waiver, rescission formula, prevailing-party fee, or presumed equitable remedy applies under this Agreement. Any negotiated risk allocation belongs in Schedule 5 and remains subject to securities counsel's review.

11. Company Covenants

After Closing, Company shall:

1. use proceeds consistently with the disclosed plan and any approved reallocation process;
2. complete the federal and Alabama filings assigned in Schedule 4;
3. maintain accurate capitalization and ownership records;
4. deliver only the reports expressly required by the governing instrument or Schedule 7; and
5. notify Investor of a material correction to an offering statement if counsel determines notice is required.

Investor consent rights, preemptive rights, information rights, board rights, protective provisions, and most-favored terms exist only if stated in the governing instrument or Schedule 7.

12. Breach and Disputes

Written notice of a contractual breach must describe the breach and requested cure. The cure period is [____] days unless delay would materially impair a filing, funding, confidentiality, or preservation deadline.

Alabama law governs the parties' contractual rights and duties, while applicable federal and Alabama securities law governs the offer, sale, issuance, filings, and remedies within its scope.

Selected forum for counsel review: [________________________________].

This Agreement contains no arbitration clause or jury-trial waiver. Either provision must be separately negotiated after counsel reviews scope, forum, costs, regulatory claims, class or collective issues, provisional relief, and enforceability.

Each party bears its own attorney's fees and costs unless a statute, court rule, separately signed provision, or final order provides otherwise.

13. General Terms

1. Amendments. An amendment must be in a signed writing identifying this Agreement and the term changed.
2. No implied waiver. A delay or single waiver does not waive another or later breach.
3. Assignment. Neither party may assign its contractual duties without the other party's written consent. Transfer of the Security is governed by Section 9 and the governing instrument.
4. Notices. Notices must use Schedule 8.
5. Entire agreement. This Agreement, the governing instrument, and completed schedules are the parties' agreement concerning the subscription and issuance.
6. Execution method. If counterparts or electronic signatures will be used, counsel should add execution language appropriate to the selected method.
7. Severability. An unenforceable provision will be severed only to the extent permitted by law; no court is directed to rewrite a material securities-compliance term.

14. Signatures

Schedule 1 — Federal and Alabama Offering Paths

Schedule 2 — Offering Materials, Risks, and Disclosures

[________________________________]

Schedule 3 — Authorization, Payment, and Closing Deliverables

[________________________________]

Schedule 4 — Filing Calendar

Schedule 5 — Negotiated Termination and Risk Allocation

[________________________________]

Schedule 6 — Investor Status and Verification Record

[________________________________]

Schedule 7 — Post-Closing Rights and Reports

[________________________________]

Schedule 8 — Notices

Sources and References

• Official U.S. Code
• Electronic Code of Federal Regulations
• Alabama Legislature — Code of Alabama