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Investor Representation Suitable Investment Securities Law

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Investor Representation Suitable Investment Securities Law Powered By Docstoc
					[From: Free Document Downloads at TheSmallBusinessOwnersManual.com]


This document should be used as a shareholder
representation letter.


The following text of this document should be reviewed and
edited to fit your purposes.


[Find, then fill-in, or delete text in brackets like this: “[NNN]”


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Otherwise the following text should be reviewed and edited as needed:
                  SHAREHOLDER REPRESENTATION LETTER


To: [RECIEPIENT]


I, [NAME] in connection with my purchase of a/an [N] interest in [N] common shares of
the corporation named above, hereby make the following representations:

       A.    I am a suitable purchaser of these shares under the California limited
              offering exemption because:

              1.      I am a director, officer or promoter of the corporation, or because I
              occupy a position with the corporation with duties and authority
              substantially similar to those of an executive officer of the corporation.
              2.      I have a pre-existing personal and/or business relationship with the
              corporation, or one or more of its directors, officers or controlling persons,
              consisting of personal or business contacts of a nature and duration which
              enables me to be aware of the character, business acumen and general
              business and financial circumstances of the person (including the
              corporation) with whom such relationship exists.
              3.      I have the capacity to protect my own interests in connection with
              my purchase of the above shares by reason of my own business and/or
              financial experience.
              4.      I meet one of the investment, net worth or individual income
              requirements provided for in Sections 260.102.13(e) and 260.102.13(g) of
              Title 10 of the California Administrative Code and I meet one of the
              additional requirements provided for in Sections 260.102.13(e)(1)-(3) of
              this Title.
              5(a). I have the capacity to protect my own interests in connection with
              my purchase of the above shares by reason of the business and/or financial
              experience of [N] whom I have engaged and hereby designate as my
              professional advisor in connection with my purchase of the above shares.
              5(b). REPRESENTATION OF PROFESSIONAL ADVISOR
              [N] hereby represents:

                     (1)     I have been engaged as the professional advisor of [N] and
                     have provided him or her with investment advice in connection
                     with the purchase of [N] common shares in [N].
                     (2)     As a regular part of my business as a/an [N], I am
                     customarily relied upon by others for investment recommendations
                     or decisions and I am customarily compensated for such services,
                     either specifically or by way of compensation for related
                     professional services.
                     (3)      I am unaffiliated with and am not compensated by the
                     corporation or any affiliate or selling agent of the corporation,
                     directly or indirectly. I do not have, nor will I have (a) a
                     relationship of employment with the corporation, either as an
                     employee, employer, independent contractor or principal; (b) the
                     beneficial ownership of securities of the corporation, its affiliates
                     or selling agents, in excess of 1% of the its securities; or (c) a
                     relationship with the corporation such that I control, am controlled
                     by, or am under common control with the corporation, and, more
                     specifically, a relationship by which I possess, directly or
                     indirectly, the power to direct, or cause the direction, of the
                     management, policies or actions of the corporation.

                     Dated: [DATE]          ____________________________________
                                            Professional Advisor

             6.     I am the spouse, relative, or relative of the spouse of another
             purchaser of shares and I have the same principal residence as this
             purchaser.

      B.      I represent that I am purchasing these shares for investment for my own
      account and not with a view to, or for, sale in connection with any distribution of
      the shares. I understand that these shares have not been qualified or registered
      under any state or federal securities law and that they may not be transferred or
      otherwise disposed of without such qualification or registration pursuant to such
      laws or an opinion of legal counsel satisfactory to the corporation that such
      qualification or registration is not required.
      C.      I have not received any advertisement or general solicitation with respect
      to the sale of the shares of the above named corporation.
      D.      I represent that, before signing this document, I have been provided access
      to, or been given, all material facts relevant to the purchase of my shares,
      including all financial and written information about the corporation and the terms
      and conditions of the stock offering and that I have been given the opportunity to
      ask questions and receive answers concerning any additional terms and conditions
      of the tock offering or other information which I, or my professional advisor if I
      have designated one, felt necessary to protect my interests in connection with the
      stock purchase transaction.


Dated: [DATE]


____________________________________

				
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