Copy No.: ___________ _____________________________________
Name:
Confidential Private Placement Memorandum
808 Energy, LLC
120 UNITS
BEING OFFERED AS
SERIES A COMMON MEMBERSHIP SHARES
PRICE PER UNIT: $25,000
THESE SECURITIES HAVE NOT BEEN REGISTERED WITH OR APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY SUCH STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PRIVATE PLACEMENT MEMORANDUM. THIS PRIVATE PLACEMENT MEMORANDUM DOES NOT CONSTITUTE AN OFFER IN ANY JURISDICTION IN WHICH AN OFFER IS NOT AUTHORIZED.
THE INFORMATION CONTAINED HEREIN IS CONFIDENTIAL AND INTENDED ONLY FOR THE ENTITY OR PERSON TO WHICH OR WHOM IT IS GIVEN OR TRANSMITTED ELECTRONICALLY.
December 1, 2008
CONFIDENTIAL PRIVATE PLACEMENT MEMORANDUM
120 Units
808 Energy, LLC
Each Unit Consists of 25,000 Series A Common Membership Shares
Price per Unit: $25,000 _____
808 Energy, LLC (―We‖, ―Us‖, or ―the Company‖) hereby offers One Hundred And Twenty (120) Units, each Unit consisting of 25,000 Series A Common Membership Shares (the ―Membership Shares‖), at a price of $25,000 per Unit. The minimum subscription is one (1) Unit. See ―Summary of the Offering‖ and ―Securities Offered‖.
The Company, on a ―best efforts‖ basis, is offering the Shares (the ―Offering‖) and all proceeds from the sale of such Shares shall be deposited in the Company‘s general account or into the account of a Broker/Dealer representing the Company upon its acceptance of each subscription. The Company may terminate this Offering at any time. _____
AN INVESTMENT IN THE SHARES IS HIGHLY SPECULATIVE. THUS, PROSPECTIVE INVESTORS SHOULD CAREFULLY REVIEW AND CONSIDER THE MATTERS DESCRIBED UNDER "RISK FACTORS" HEREIN (COMMENCING ON PAGE 14). _____
THE SECURITIES OFFERED BY THIS PRIVATE PLACEMENT MEMORANDUM HAVE NOT BEEN REGISTERED WITH OR APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION, ANY STATE SECURITIES COMMISSION OR ANY OTHER REGULATORY AUTHORITY, NOR HAVE ANY OF THE FOREGOING AUTHORITIES PASSED UPON OR ENDORSED THE MERITS OF THIS OFFERING, OR THE ACCURACY OR ADEQUACY OF THIS PRIVATE PLACEMENT MEMORANDUM. ANY SUCH REPRESENTATION TO THE CONTRARY IS UNLAWFUL.
Per Share Total
Price to Investors $1.00 $3,000,000
Proceeds to Company $1.00 $3,000,000
SUMMARY OF SUBSCRIPTION PROCEDURES
The prospective investor (the ―Investor‖) whose name appears on the cover of this memorandum (―Memorandum‖) has received herewith a subscription agreement (―Subscription Agreement‖) for subscribing to purchase Units. To subscribe for Units, an Investor must complete, execute and deliver to the Office of the Company, Managing Member, Patrick Carter, 808 Energy, LLC, 5011 Argosy Avenue, Suite 4, Huntington Beach, CA 92649, the following items: (i) one copy of the Subscription Agreement, by means of which the Investor shall subscribe to purchase not less than one (1) Unit, and (ii) a check payable to 808 Energy, LLC in the amount of $25,000 for each Unit for which the Investor wishes to subscribe and the corresponding fraction of any additional Unit for which the Investor wishes to subscribe (subscribers wanting to arrange for wire transfer in lieu of payment by check are requested to contact Managing Member, Patrick Carter, (714) 891-8282 for further instructions).
The payment of each Investor, along with the payments of other Investors, shall be placed in 808 Energy, LLC‘s corporate bank account or into the account of a Broker/Dealer representing the Company when the subscription of such Investor is accepted by the Company. Subscriptions for the purchase of Units may be accepted by the Company as received, and there is no minimum number of Units for which subscriptions must be received prior to the acceptance by the Company of subscriptions. Any subscriptions not received and accepted by the Company by December 31, 2008 (the ―Termination Date‖), shall be deemed refused and the Company shall return the full amount of the subject Investor‘s cash payment, without interest or deduction; however, the Termination Date may be extended for up to an additional sixty (60) days at the sole discretion of the Company. If the Offering for Units is oversubscribed, the Company shall have the right to prorate all subscriptions, or reject any subscriptions received, at the sole discretion of the Company. See ―Terms of the Offering – Subscription Procedures‖.
SUITABILITY AND OTHER MATTERS
INVESTORS SHALL BE REQUIRED TO REPRESENT THAT THEY ARE FAMILIAR WITH AND UNDERSTAND THE TERMS, RISKS AND MERITS OF THE OFFERING DESCRIBED IN THIS MEMORANDUM, AND ALL THE ATTACHMENTS HERETO. THE SHARES ARE BEING OFFERED IN A PRIVATE OFFERING TO A LIMITED NUMBER OF INDIVIDUALS OR ENTITIES MEETING CERTAIN SUITABILITY STANDARDS (SEE ―TERMS OF THE OFFERING – INVESTOR SUITABILITY STANDARDS‖). THIS OFFERING INVOLVES A HIGH DEGREE OF RISK AND PROSPECTIVE INVESTORS
SHOULD BE AWARE THAT THEY MAY SUSTAIN A LOSS OF THEIR ENTIRE INVESTMENT (SEE ―RISK FACTORS‖).
EXCLUSIVE NATURE OF PRIVATE PLACEMENT MEMORANDUM
NO ENTITY HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS MEMORANDUM. ANY INFORMATION OR REPRESENTATION NOT CONTAINED HEREIN MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY. MOREOVER, NEITHER THE DELIVERY OF THIS MEMORANDUM NOR THE SALE OF THE SHARES SHALL UNDER ANY CIRCUMSTANCES CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE MATTERS DISCUSSED IN THIS MEMORANDUM SINCE THE DATE HEREOF. THE COMPANY DISCLAIMS ANY AND ALL LIABILITIES FOR REPRESENTATIONS OR WARRANTIES EXPRESSED OR IMPLIED, CONTAINED IN, OR OMISSIONS FROM, THIS MEMORANDUM, OR ANY OTHER WRITTEN OR ORAL COMMUNICATION TRANSMITTED OR MADE AVAILABLE TO THE RECIPIENT. EACH INVESTOR SHALL BE ENTITLED TO RELY SOLELY ON THOSE REPRESENTATIONS AND WARRANTIES WHICH MAY BE MADE TO THE INVESTOR IN ANY FINAL PURCHASE OR SUBSCRIPTION AGREEMENT RELATING TO THE SHARES. THE DELIVERY OF THIS MEMORANDUM DOES NOT CONSTITUTE AN OFFER IN ANY JURISDICTION TO ANY PERSON TO WHOM SUCH OFFER WOULD BE UNLAWFUL IN SUCH JURISDICTION.
THIS MEMORANDUM DOES NOT PURPORT TO BE ALL-INCLUSIVE OR TO CONTAIN ALL OF THE INFORMATION THAT A PROSPECTIVE INVESTOR MAY DESIRE IN EVALUATING AN INVESTMENT IN THE COMPANY. INVESTORS MUST CONDUCT AND RELY ON THEIR OWN EVALUATIONS OF THE COMPANY AND THE TERMS OF THE OFFERING, INCLUDING THE MERITS AND RISKS INVOLVED IN MAKING AN INVESTMENT DECISION WITH RESPECT TO THE SHARES. SEE ―RISK FACTORS‖ FOR A DISCUSSION OF CERTAIN FACTORS WHICH SHOULD BE CONSIDERED IN CONNECTION WITH THE PURCHASE OF THE SHARES. NEITHER THE DELIVERY OF THIS MEMORANDUM AT ANY TIME, NOR ANY SALE OF THE SHARES HEREUNDER, SHALL UNDER ANY CIRCUMSTANCES CREATE AN IMPLICATION THAT THE INFORMATION CONTAINED IN THIS MEMORANDUM IS CORRECT AS OF ANY TIME SUBSEQUENT TO ITS DATE.
STATEMENT REGARDING FORWARD LOOKING PROJECTIONS
THE STATEMENTS, PROJECTIONS AND ESTIMATES OF FUTURE PERFORMANCE OF THE COMPANY OR VARIOUS ELEMENTS OF THE COMPANY‘S BUSINESS CONTAINED IN THIS MEMORANDUM THAT ARE NOT HISTORICAL FACTS ARE FORWARD-LOOKING STATEMENTS. INVESTORS SHOULD EXPECT THAT ANTICIPATED EVENTS AND CIRCUMSTANCES SHALL NOT OCCUR, THAT UNANTICIPATED EVENTS AND CIRCUMSTANCES SHALL OCCUR, AND THAT ACTUAL RESULTS SHALL LIKELY VARY FROM THE FORWARD-LOOKING STATEMENTS, PROJECTIONS AND ESTIMATES. INVESTORS SHOULD BE AWARE THAT A NUMBER OF FACTORS COULD CAUSE THE FORWARD-LOOKING STATEMENTS, PROJECTIONS AND ESTIMATES CONTAINED IN THIS MEMORANDUM OR OTHERWISE MADE BY OR ON BEHALF OF THE COMPANY TO BE INCORRECT OR TO DIFFER MATERIALLY FROM ACTUAL RESULTS. SUCH FACTORS MAY INCLUDE, WITHOUT LIMITATION, (i) THE ABILITY OF THE COMPANY TO PROVIDE SERVICES AND TO COMPLETE THE DEVELOPMENT OF ITS PRODUCTS/SERVICES OFFERINGS IN A TIMELY MANNER, (ii) THE DEMAND FOR AND TIMING OF DEMAND FOR SUCH SERVICES AND PRODUCTS, (iii) COMPETITION FROM OTHER PRODUCTS AND COMPANIES, (iv) THE COMPANY‘S SALES AND MARKETING CAPABILITIES, (v) THE COMPANY‘S ABILITY TO SELL ITS SERVICES AND PRODUCTS PROFITABLY, (vi) AVAILABILITY OF ADEQUATE DEBT AND EQUITY FINANCING, AND (vii) GENERAL BUSINESS AND ECONOMIC CONDITIONS. THESE IMPORTANT FACTORS AND CERTAIN OTHER FACTORS THAT MIGHT AFFECT THE COMPANY‘S FINANCIAL AND BUSINESS RESULTS ARE FURTHER DISCUSSED IN THIS MEMORANDUM UNDER ―RISK FACTORS.‖ THERE CAN BE NO ASSURANCE THAT THE COMPANY SHALL BE ABLE TO ANTICIPATE, RESPOND TO OR ADAPT TO CHANGES IN ANY FACTORS AFFECTING THE COMPANY‘S BUSINESS AND FINANCIAL RESULTS.
SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT
WITH THE EXCEPTION OF THE HISTORICAL INFORMATION CONTAINED IN THIS DOCUMENT, THE MATTERS DESCRIBED HEREIN CONTAIN FORWARD-LOOKING STATEMENTS THAT INVOLVE RISK AND UNCERTAINTIES THAT INDIVIDUALLY OR MUTUALLY IMPACT THE MATTERS HEREIN DESCRIBED INCLUDING, BUT NOT LIMITED TO, FINANCIAL PROJECTIONS, PRODUCT DEMAND AND MARKET ACCEPTANCE, THE EFFECT OF ECONOMIC CONDITIONS, THE IMPACT OF COMPETITIVE PRODUCTS AND PRICING, GOVERNMENTAL REGULATIONS,
TECHNOLOGICAL DIFFICULTIES AND/OR OTHER FACTORS OUTSIDE THE CONTROL OF THE COMPANY.
FOR RESIDENTS OF ALL STATES
IN MAKING AN INVESTMENT DECISION, INVESTORS MUST RELY ON THEIR OWN EXAMINATIONS OF THE COMPANY AND THE TERMS OF THE OFFERING, INCLUDING THE MERITS AND RISKS INVOLVED.
THIS MEMORANDUM HAS BEEN PREPARED FOR INFORMATIONAL PURPOSES ONLY IN ORDER TO ASSIST PROSPECTIVE INVESTORS IN EVALUATING AN INVESTMENT IN THE COMPANY. BY ACCEPTING DELIVERY OF THIS MEMORANDUM, OR ANY OTHER MATERIAL IN CONNECTION WITH THIS OFFERING, THE OFFEREE AGREES: (a) TO KEEP STRICTLY CONFIDENTIAL THE CONTENTS OF THIS MEMORANDUM AND SUCH OTHER MATERIAL, AND TO NOT DISCLOSE SUCH CONTENTS TO ANY THIRD PARTY OR OTHERWISE USE THE CONTENTS FOR ANY PURPOSE OTHER THAN EVALUATION BY SUCH OFFEREE OF AN INVESTMENT IN THE SHARES; (b) NOT TO COPY ALL OR ANY PORTION OF THIS MEMORANDUM OR ANY SUCH OTHER MATERIAL; AND (c) TO RETURN THIS MEMORANDUM AND ALL SUCH OTHER MATERIAL TO THE COMPANY IF (i) THE OFFEREE DOES NOT SUBSCRIBE TO PURCHASE ANY SHARES, (ii) THE OFFEREE‘S SUBSCRIPTION IS NOT ACCEPTED, OR (iii) THIS OFFERING IS TERMINATED OR WITHDRAWN.
THE OFFER AND SALE OF THE SHARES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS IN RELIANCE UPON EXEMPTIONS FROM REGISTRATION PROVIDED BY SECTION 4(2) OF THE SECURITIES ACT OF 1933, AS AMENDED, AND REGULATION D PROMULGATED THEREUNDER, AND SIMILAR EXEMPTIONS FROM REGISTRATION PROVIDED BY CERTAIN STATE SECURITIES LAWS. THE SHARES ARE OFFERED ONLY TO ACCREDITED INVESTORS WHO HAVE THE QUALIFICATIONS NECESSARY TO PERMIT THE SHARES TO BE OFFERED AND SOLD IN RELIANCE UPON SUCH EXEMPTIONS, AND WHO MEET THE SUITABILITY STANDARDS SET FORTH BELOW IN ―TERMS OF OFFERING - INVESTOR SUITABILITY STANDARDS.‖
THIS MEMORANDUM CONSTITUTES AN OFFER ONLY TO THE OFFEREE TO WHOM THIS MEMORANDUM IS INITIALLY PROVIDED BY THE COMPANY AND DOES NOT CONSTITUTE AN OFFER TO SELL TO OR A SOLICITATION OF AN OFFER TO BUY
FROM ANYONE IN ANY STATE OR OTHER JURISDICTION IN WHICH SUCH OFFER OR SOLICITATION IS NOT AUTHORIZED, OR TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH AN OFFER OR SOLICITATION.
THE COMPANY RESERVES THE RIGHT AT ITS SOLE DISCRETION AND FOR ANY REASON WHATSOEVER TO MODIFY, AMEND AND/OR WITHDRAW ALL OR A PORTION OF THE OFFERING, AND/OR ACCEPT OR REJECT IN WHOLE OR IN PART ANY PROSPECTIVE INVESTMENT IN THE UNITS, OR TO ALLOT TO ANY PROSPECTIVE INVESTOR LESS THAN THE NUMBER OF SHARES SUCH INVESTOR DESIRES TO PURCHASE. THE COMPANY SHALL HAVE NO LIABILITY WHATSOEVER TO ANY OFFEREE AND/OR INVESTOR IN THE EVENT THAT ANY OF THE FOREGOING SHALL OCCUR.
THIS MEMORANDUM INCLUDES PROJECTIONS AND OTHER FORWARD-LOOKING INFORMATION. SUCH PROJECTIONS AND INFORMATION ARE BASED ON ASSUMPTIONS AS TO FUTURE EVENTS THAT ARE INHERENTLY UNCERTAIN AND SUBJECTIVE. THE COMPANY MAKES NO REPRESENTATION OR WARRANTY AS TO THE ATTAINABILITY OF SUCH ASSUMPTIONS OR AS TO WHETHER FUTURE RESULTS SHALL OCCUR AS PROJECTED. IT MUST BE RECOGNIZED THAT THE PROJECTIONS OF THE COMPANY‘S FUTURE PERFORMANCE ARE NECESSARILY SUBJECT TO A HIGH DEGREE OF UNCERTAINTY, THAT ACTUAL RESULTS CAN BE EXPECTED TO VARY FROM THE RESULTS PROJECTED, AND THAT SUCH VARIANCES MAY BE MATERIAL AND ADVERSE. PROSPECTIVE INVESTORS ARE EXPECTED TO CONDUCT THEIR OWN INVESTIGATIONS WITH REGARD TO THE COMPANY AND ITS PROSPECTS.
NEITHER THE DELIVERY OF THIS MEMORANDUM NOR ANY SALE MADE HEREUNDER SHALL CREATE, UNDER ANY CIRCUMSTANCE, ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY AND OTHER INFORMATION CONTAINED HEREIN SINCE THE DATE HEREOF.
CERTAIN PROVISIONS OF VARIOUS AGREEMENTS ARE SUMMARIZED IN THIS MEMORANDUM, BUT PROSPECTIVE INVESTORS SHOULD NOT ASSUME THAT THE SUMMARIES ARE COMPLETE. SUCH SUMMARIES ARE QUALIFIED IN THEIR ENTIRETY BY REFERENCE TO THE TEXTS OF THE ORIGINAL DOCUMENTS WHICH SHALL BE MADE AVAILABLE TO PROSPECTIVE INVESTORS BY THE COMPANY.
PROSPECTIVE INVESTORS SHOULD NOT CONSTRUE THE CONTENTS OF THIS MEMORANDUM, OR ANY PRIOR OR SUBSEQUENT COMMUNICATIONS FROM OR WITH THE COMPANY, OR ANY PROFESSIONAL ASSOCIATED WITH THE OFFERING AS LEGAL OR PROFESSIONAL TAX ADVICE. THE OFFEREE AUTHORIZED TO RECEIVE THIS MEMORANDUM SHOULD CONSULT PERSONAL COUNSEL, ACCOUNTANT OR BUSINESS ADVISOR REGARDING LEGAL, TAX AND OTHER MATTERS CONCERNING PURCHASING THE UNITS, RESPECTIVELY.
THE COMPANY SHALL MAKE AVAILABLE TO ANY PROSPECTIVE INVESTOR, PRIOR TO THE CLOSING FOR THE SALE OF THE SHARES, THE OPPORTUNITY TO ASK QUESTIONS OF, AND TO RECEIVE ANSWERS FROM, REPRESENTATIVES OF THE COMPANY CONCERNING THE COMPANY AND THE TERMS AND CONDITIONS OF THE OFFERING, AND TO OBTAIN ANY ADDITIONAL RELEVANT INFORMATION TO THE EXTENT THE COMPANY POSSESSES SUCH INFORMATION OR CAN OBTAIN IT WITHOUT UNREASONABLE EFFORT OR EXPENSE. EXCEPT FOR SUCH INFORMATION THAT IS PROVIDED BY THE COMPANY IN RESPONSE TO REQUESTS FROM PROSPECTIVE INVESTORS OR THEIR ADVISORS, NO PERSON HAS BEEN AUTHORIZED IN CONNECTION WITH THE OFFER OR SALE OF THE SHARES TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATION NOT CONTAINED IN THIS MEMORANDUM, AND IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON. PROSPECTIVE INVESTORS SHOULD NOT RELY UPON INFORMATION NOT CONTAINED IN THIS MEMORANDUM UNLESS IT IS PROVIDED BY THE COMPANY AS INDICATED ABOVE.
THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND APPLICABLE STATE SECURITIES LAWS PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM. INVESTORS SHOULD BE AWARE THAT THEY MAY BE REQUIRED TO BEAR THE FINANCIAL RISKS OF THE INVESTMENT FOR AN INDEFINITE PERIOD OF TIME.
FOR CONNECTICUT RESIDENTS ONLY: THE UNDERSIGNED ACKNOWLEDGES THAT THE SECURITIES COMPRISING THE SHARES HAVE NOT BEEN REGISTERED UNDER THE CONNECTICUT UNIFORM SECURITIES ACT, AS AMENDED (THE ―CONNECTICUT ACT‖), AND ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND SALE OF SECURITIES AS SET FORTH HEREIN. THE UNDERSIGNED HEREBY AGREES THAT SUCH SECURITIES SHALL NOT BE TRANSFERRED OR SOLD WITHOUT REGISTRATION UNDER THE CONNECTICUT ACT OR EXEMPTION THEREFROM.
FOR MAINE RESIDENTS ONLY: THE SHARES ARE BEING SOLD PURSUANT TO AN EXEMPTION FROM REGISTRATION WITH THE BANK SUPERINTENDENT OF THE STATE OF MAINE UNDER SECTION 10502(2)(R) OF TITLE 32 OF THE MAIN REVISED STATUTES. THE SECURITIES COMPRISING THE SHARES MAY BE DEEMED RESTRICTED SECURITIES AND AS SUCH THE HOLDER MAY NOT BE ABLE TO RESELL SUCH SECURITIES UNLESS THEY ARE REGISTERED UNDER STATE OR FEDERAL SECURITIES LAWS OR AN EXEMPTION UNDER SUCH LAWS EXISTS.
FOR MISSOURI RESIDENTS ONLY: THE UNDERSIGNED ACKNOWLEDGES THAT THE SHARES HAVE NOT BEEN REGISTERED UNDER THE MISSOURI UNIFORM SECURITIES ACT, AS AMENDED (THE ―MISSOURI ACT‖), AND ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND SALE OF SECURITIES AS SET FORTH HEREIN. THE UNDERSIGNED HEREBY ACKNOWLEDGES THAT SUCH SHARES MAY BE DISPOSED OF ONLY THROUGH A LICENSED BROKER-DEALER. IT IS A FELONY TO SELL SECURITIES IN VIOLATION OF THE MISSOURI ACT.
FOR TEXAS RESIDENTS ONLY: THE UNDERSIGNED HEREBY ACKNOWLEDGES THAT THE SHARES CANNOT BE SOLD UNLESS THEY ARE SUBSEQUENTLY REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND THE TEXAS SECURITIES ACT, OR AN EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE. THE UNDERSIGNED FURTHER ACKNOWLEDGES THAT BECAUSE THE SHARES ARE NOT READILY TRANSFERRABLE, THE INVESTOR MUST BEAR THE ECONOMIC RISK OF THE INVESTMENT FOR AN INDEFINITE PERIOD OF TIME.
FOR UNITED KINGDOM RESIDENTS ONLY: NO PROSPECTUS IN RESPECT OF THE SECURITIES BEING OFFERED HEREBY HAS BEEN OR SHALL BE PREPARED AND FILED IN THE UNITED KINGDOM BY THE COMPANY PURSUANT TO THE UNITED KINGDOM PUBLIC OFFERS OF SECURITIES REGULATIONS 1995. ACCORDINGLY, THE SECURITIES BEING OFFERED HEREBY MAY NOT BE SOLD OR REOFFERED, OR RESOLD TO PERSONS IN THE UNITED KINGDOM EXCEPT TO PERSONS WHOSE ORDINARY ACTIVITIES INVOLVE THEM IN ACQUIRING, HOLDING, MANAGING OR DISPOSING OF INVESTMENTS (AS PRINICPAL OR AGENT) FOR THE PURPOSES OF THEIR BUSINESSES, OR OTHERWISE IN CIRCUMSTANCES THAT SHALL NOT CONSTITUTE OR RESULT IN AN OFFER TO THE PUBLIC IN THE UNITED KINGDOM WITHIN THE MEANING OF THE UNITED KINGDOM PUBLIC OFFERS OF SECURITIES REGULATIONS 1995. THIS MEMORANDUM MAY NOT BE PASSED TO ANY ENTITY IN THE UNITED KINGDOM WHICH DOES NOT FALL WITHIN ARTICLE 11(3) OF THE FINANCIAL SERVICES ACT OF 1986 (INVESTMENT ADVERTISMENTS)
(EXCEPTIONS) ORDER 1995 OR WHO IS NOT OTHERWISE AN ENTITY TO WHOM THE DOCUMENT MAY LAWFULLY BE ISSUED OR PASSED.
NOTICE TO NON-UNITED STATES RESIDENTS: IT IS THE RESPONSIBILITY OF ANY ENTITIES WISHING TO PURCHASE THE SHARES TO SATISFY THEMSELVES AS TO FULL OBSERVANCE OF THE LAWS OF ANY RELEVANT TERRITORY OUTSIDE THE UNITED STATES IN CONNECTION WITH ANY SUCH PURCHASE, INCLUDING OBTAINING ANY REQUIRED GOVERNMENTAL OR OTHER CONSENTS OR OBSERVING ANY OTHER APPLICABLE FORMALITIES.
PATRIOT ACT RIDER
THE INVESTOR HEREBY REPRESENTS AND WARRANTS THAT THE INVESTOR IS NOT, NOR IS IT ACTING AS AN AGENT, REPRESENTATIVE, INTERMEDIARY OR NOMINEE FOR, A PERSON IDENTIFIED ON THE LIST OF BLOCKED PERSONS MAINTAINED BY THE OFFICE OF FOREIGN ASSETS CONTROL, U.S. DEPARTMENT OF TREASURY. IN ADDITION, THE INVESTOR HAS COMPLIED WITH ALL APPLICABLE U.S. LAWS, REGULATIONS, DIRECTIVES, AND EXECUTIVE ORDERS RELATING TO ANTI-MONEY LAUNDERING , INCLUDING BUT NOT LIMITED TO THE FOLLOWING LAWS: (1) THE UNITING AND STRENGTHENING AMERICA BY PROVIDING APPROPRIATE TOOLS REQUIRED TO INTERCEPT AND OBSTRUCT TERRORISM ACT OF 2001, PUBLIC LAW 107-56, AND (2) EXECUTIVE ORDER 13224 (BLOCKING PROPERTY AND PROHIBITING TRANSACTIONS WITH PERSONS WHO COMMIT, THREATEN TO COMMIT, OR SUPPORT TERRORISM) OF SEPTEMBER 23, 2001.
TABLE OF CONTENTS
SUMMARY OF SUBSCRIPTION PROCEDURES. 1 SUITABILITY AND OTHER MATTERS. 2 EXCLUSIVE NATURE OF PRIVATE PLACEMENT MEMORANDUM.. 2 STATEMENT REGARDING FORWARD LOOKING PROJECTIONS. 3 SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT 3 FOR RESIDENTS OF ALL STATES. 3 PATRIOT ACT RIDER.. 6 SUMMARY OF THE OFFERING.. 9 Company Description. 9 Product Differentiation. 9 Nature of Operations. 9 Liquidity and Capital Resources. 10 SECURITIES OFFERED.. 11 Available Information. 13 Selected Financial Information. 13 RISK FACTORS. 14 A. Limited Operating History; Limited Capital; Start-up Company. 14 B. No Minimum Offering. 14 C. Need for Additional Financing. 15 D. Intense Competition. 15 E. Potential Fluctuations in Operating Results. 15 F. Risk of Managing Growth. 15
G. Continued Investment Required. 16 H. Attraction and Retention of Professional and Qualified Personnel 16 I. Dilution. 16 J. Control By Existing shareholders. 16 K. Risks Associated With Financial Projections; VARIANCE IN REBATES. 16 L. Limited Liquidity in the Absence of a Public Market 17 M. Restrictions on Transfer of Securities. 17 N. Determination of Offering Price. 17 O. Best Efforts Offering. 18 P. Working Capital Requirements. 18 Q. Facilities. 18 R. Legal Matters. 18 S. Previous Offerings. 18 T. Absence of Merit Review.. 18 U. Risks Associated with Forward-Looking Statements Included in this Memorandum.. 19 V. Risks Associated with Government Regulation. 19 COMPANY EXECUTIVE SUMMARY.. 21 The Company. 21 808 Energy Highlights. 21 A Debt-free installation. 21 Management 22 Patrick Carter — Managing Member 22 Positioning. 22
Details of the Pacific Clay Plant 23 Cash Flow, Rebates and Tax Benefits. 23 Benefits to Pacific Clay. 23 Investor Benefits. 23 Industry Analysis. 23 Berkshire-Hathaway Invests in Renewable Energy…... 24 As Do Other Key Players…... 24 Competitive Landscape. 25 Financial Strategy. 26 Cost Drivers…... 26 Financial Statements. 26 DISCLAIMER.. 34 USE OF PROCEEDS. 34 DESCRIPTION OF COMPANY UNITS. 34 EXHIBIT A: SUBSCRIPTION AGREEMENT. 35 CERTIFICATE OF ACCREDITED INVESTOR STATUS. 38
SUMMARY OF THE OFFERING
INVESTORS SHOULD READ THIS MEMORANDUM CAREFULLY BEFORE MAKING ANY INVESTMENT DECISIONS REGARDING THE COMPANY AND SHOULD PAY PARTICULAR ATTENTION TO THE INFORMATION CONTAINED UNDER THE HEADING ―RISK FACTORS.‖ ADDITIONALLY, INVESTORS SHOULD CONSULT THEIR OWN ADVISORS IN ORDER TO FULLY COMPREHEND THE CONSEQUENCES OF INVESTING IN THE COMPANY. THE FOLLOWING SUMMARY DOES NOT PURPORT TO BE COMPLETE AND IS QUALIFIED IN ITS ENTIRETY BY MORE DETAILED INFORMATION APPEARING ELSEWHERE IN THIS MEMORANDUM AND THE EXHIBITS HERETO.
Company Description
808 Energy, LLC (‗808 Energy‘, ‗the Company‘, and/or ‗Management‘) is a Nevada limited liability company. 808 Energy is a single purpose investment company, and is involved in investing in Green Energy service opportunities. The founder and Managing Member of 808 Energy is Patrick Carter.
Product Differentiation
Due to competitive pressures to cut costs and reduce emissions of air pollutants and greenhouse gasses, owners and operators of industrial and commercial facilities are actively looking for ways to use energy more efficiently. 808 Energy offers a significant option in this area known as cogeneration, also known as combined heat and power (CHP). Cogeneration/ CHP is the simultaneous production of electricity and useful heat from the same fuel or energy. Facilities with cogeneration systems use them to produce their own electricity, and use the unused excess (waste) heat for process steam, hot water heating, space heating, and other thermal needs. They may also use excess process heat to produce steam for electricity production.
Cogeneration is a thermodynamically efficient use of fuel. In the separate production of electricity, some energy must be rejected as waste heat, but in cogeneration this thermal energy is put to good use. A typical cogeneration system consists of an engine, steam turbine, or combustion turbine that drives an electrical generator. A waste heat exchanger recovers waste heat from the engine and/or exhaust gas to produce hot water or steam. Cogeneration produces a given amount of electric power and process heat with 10% to 30% less fuel than it takes to produce the electricity and process heat separately.
Nature of Operations
808 Energy has agreed to purchase the 1.4 MW Pacific Clay power plant from Southern Pacific Energy. The Pacific Clay plant is a low cost, on-site cogeneration power facility The acquisition of the Pacific Clay installation is structured without debt, thus revenues are insulated from debt service requirements Customers such as Pacific Clay save an average of 30% on electrical and heating costs and enter long-term contracts for these critical resources 808 Energy receives recurring revenue, tax benefits, a 10-year payment commitment, equipment ownership and cost subsidies Profits to the plant owners come from the sale of electricity plus ―captured‖ excess waste heat Efficient energy plus less pollution equals lower costs and green status
Liquidity and Capital Resources
808 Energy‘s business purpose is to acquire and operate the Pacific Clay energy plant. Assuming the maximum proceeds of the Offering are raised ($3,000,000), the Company believes that the cash flow from the offering will be sufficient to cover the funding needed to acquire the energy plant and for meeting initial operational expenses.
See ―Risk Factors - Need for Additional Financing‖ and ―Use of Proceeds‖. This space is intentionally left blank
SECURITIES OFFERED
Securities Offered Up to one hundred and twenty (120) Units are available in this Offering of Series A Common Membership Shares. Each Unit consists of 25,000 Membership Shares.
Price per Unit
$25,000.
Minimum Investment The minimum subscription is one (1) Unit of 25,000 Shares; however, the Company, in its sole discretion, may accept subscriptions for less than one (1) Unit.
Offering Period Commencing on the date hereof and terminating on December 31st, 2008, unless extended by the Company for up to an additional sixty (60) days.
Multiple Closings The Company expects to accept subscriptions as they are received. Subsequent to the initial closing, the Company may hold multiple closings for the purchase and sale of the Units. If the Company determines not to hold closing for Units prior to the Termination Date and elects not to accept subscriptions, all funds received for such Units shall be promptly refunded in full, without interest or deduction.
Investor Suitability The Shares are being offered and sold solely to ―accredited investors‖ as defined pursuant to Rule 501 of Regulation D of the Securities Act of 1933, as amended (the ―Act‖), pursuant to an exemption from registration pursuant to Regulation D. Subscribers shall be required to submit a completed Subscription Agreement so that the Company can determine whether investor suitability requirements are satisfied. Affiliates of the Company or any placement agent retained by the Company may acquire Units.
Subscription Agreement Purchases of the Units must be made pursuant to the Subscription Agreement in the form included in the subscription booklet appended to this memorandum as Exhibit A (the ―Subscription Agreement‖) which contains, among other
provisions, representations, and warranties by the Company, investment representations by the subscriber, restrictions on transferability of the Units and the underlying Membership Shares.
Membership Shares Currently Outstanding
None.
Membership Shares Outstanding after Completion of this Offering[1]
3,000,000 shares
Use of Proceeds The Company intends to use the net proceeds from this Offering for: acquisition and operation of the Pacific Clay cogeneration plant; launch-related working capital and general company purposes; and strengthening our general and administrative structure.
Plan of Distribution The Units will be offered and sold by officers, directors and employees of the Company and other qualified personnel.
Limited Transferability The Units of Membership Shares being sold will not be registered with the Securities and Exchange Commission or qualified under the securities laws of any state, but will be offered and sold pursuant to an exemption thereof. Therefore, the Membership Shares may not be resold or otherwise distributed without registration or qualification under the Act and/or any other applicable securities laws or the availability of an exemption there from. Furthermore, there is currently no market for the Shares and no market is expected to develop. See ―Risk Factors – Restrictions on Transfer of Securities‖ and ―Limited Liquidity in the Absence of a Public Market‖
Available Information
The Company is not presently subject to the reporting and information requirements of the Securities Exchange Act of 1934 (the ―Exchange Act‖), and therefore does not file reports, proxy statements and other statements.
Selected Financial Information
THE EXECUTIVE SUMMARY-BUSINESS PLAN DEVELOPED BY THE COMPANY (THE ―BUSINESS PLAN‖) CONTAINS CERTAIN PROJECTIONS WITH RESPECT TO ITS ANTICIPATED FUTURE OPERATIONS. THE FINANCIAL PROJECTIONS AND THE ASSUMPTIONS UPON WHICH THEY ARE BASED REPRESENT FORECASTS OF RESULTS THAT MIGHT BE ACHIEVED SHOULD ALL THE STATED ASSUMPTIONS CONTAINED THEREIN BE REALIZED. NEITHER THE DELIVERY OF THIS MEMORANDUM NOR ANY SALE MADE HEREUNDER SHALL CREATE, UNDER ANY CIRCUMSTANCE, ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY AND OTHER INFORMATION CONTAINED HEREIN SINCE THE DATE HEREOF.
RISK FACTORS
THE PURCHASE OF SHARES INVOLVES A HIGH DEGREE OF RISK INCLUDING, BUT NOT NECESSARILY LIMITED TO, THE RISKS DESCRIBED BELOW. BEFORE SUBSCRIBING FOR SHARES, EACH INVESTOR SHOULD CONSIDER CAREFULLY THE GENERAL INVESTMENT RISKS ENUMERATED ELSEWHERE IN THIS MEMORANDUM AND THE FOLLOWING RISK FACTORS, AS WELL AS THE OTHER INFORMATION CONTAINED IN THIS MEMORANDUM.
A. Limited Operating History; Limited Capital; Start-up Company
The Company commenced operations in 2006. Investment in an early-stage company such as the Company is inherently subject to many risks, and investors should be prepared to withstand a complete loss of their investments. The Company has no operating history upon which investors may base an evaluation of its performance; therefore, it is subject to all the risks incident to the creation and development of a new business.
There can be no assurance that the Company can realize its plans on the projected timetable in order to reach sustainable or profitable operations. Any material deviation from the Company‘s timetable could require that the Company seek additional capital. There can be no assurance that such capital shall be available at reasonable cost, or that it would not materially dilute the investment of investors in this Offering if it is obtained.
Investment in an early-stage company such as the Company is inherently subject to many risks, and investors should be prepared to withstand a complete loss of their investments. The Company has no operating history upon which investors may base an evaluation of its performance; therefore, it is subject to all the risks incident to the creation and development of a new business.
The Company plans to conduct closings of sales of Shares as subscriptions are received.
Need for Additional Financing
Assuming all 3,000,000 Shares are sold in this Offering, the Company believes that the net proceeds from this Offering shall be sufficient to fund the Company's planned operations as currently projected. Such belief, however, cannot give rise to an assumption that the Company‘s cost estimates are accurate or that unforeseen events would not occur that would require the Company to seek additional funding to meet its operational needs. In addition, there can be no assurance that the Company‘s cash flow generated from operations shall be sufficient to implement the Company‘s business objectives. As a result, the Company may require substantial additional financing in order to implement its business objectives.
D. Intense Competition
The Company‘s principal competitors may have greater financial resources than those available to the Company and thus be in a better position to attract key human resources talent in performance-critical areas, launch and/or carry on important programs and initiatives. There can be no assurances that the Company consistently shall be able to undertake programs and initiatives that could prove profitable to the Company in view of the intense competition to be encountered by the Company in all significant phases of its activities.
E. Potential Fluctuations in Operating Results
Significant annual and quarterly fluctuations in the Company‘s results of operations may be caused by, among other factors, the volume of revenues generated by the Company and general economic conditions.
There can be no assurances that the level of revenues and profits, if any, achieved by the Company in any particular fiscal period shall not be significantly lower than in other, including comparable, fiscal periods. The Company‘s expense levels are based, in part, on its expectations as to future revenues.
As a result, if future revenues are below expectations, net income or loss may be disproportionately affected by a reduction in revenues, as any corresponding reduction in expenses may not be proportionate to the reduction in revenues. As a result, the Company believes that period-to-period comparisons of its results of operations may not necessarily be meaningful and should not be relied upon as indications of future performance.
F. Risk of Managing Growth
The company could grow and expand its initial operations. The anticipated growth could place a significant strain on the Company‘s management, and operational and financial resources. Effective management of the anticipated growth shall require expanding the Company‘s management and financial controls, hiring additional appropriate personnel as required, and developing additional expertise by existing management personnel. However, there can be no assurances that these or other measures implemented by the Company shall effectively increase the Company‘s capabilities to manage such anticipated growth or to do so in a timely and costeffective manner. Moreover, management of growth is especially challenging for a company with a short operating history and limited financial resources, and the failure to effectively manage growth could have a material adverse effect on the Company‘s operations.
G. Continued Investment Required
The Company does not contemplate additional investment being needed to maintain operations as currently projected. However, there can be no assurances that the Company shall generate sufficient funds from operations to finance any additional investment that might be required, needed or recommended or that other sources of funding shall be available for such purposes. Additionally, there can be no guarantees that any future expansion shall not negatively affect earnings.
H. Attraction and Retention of Professional and Qualified Personnel
The Company‘s ability to realize its objectives shall be dependent on its ability to attract and retain additional, qualified personnel. Competition for such personnel can be intense, and there can be no assurance that the Company‘s results shall not be adversely affected by difficulty in attracting and/or retaining qualified personnel.
I. Dilution
After completion of the Offering, Series A Common Membership Shareholders shall own Three Million (3,000,000) Series A Common Membership Shares, representing 100% percent of the Company‘s Series A Common Membership Shares.
J. Control By Existing shareholders
Upon the completion of this Offering the directors, executive officers and principal Series A Common Membership Shareholders of the Company shall own 20% percent of the Series A Common Membership Shares. As a result, such entities shall have a significant influence on the affairs and management of the Company, as well as on all matters requiring Membership Shareholder approval, including electing and removing members of the Company‘s board of directors (the ―Board‖), causing the Company to engage in transactions with affiliated entities, causing or restricting the sale or merger of the Company, and changing the Company‘s dividend and/or distribution policy(ies). Such concentration of ownership and control could have the effect of delaying, deferring or preventing a change in control of the Company even when such a change of control would be in the best interests of the Company‘s other shareholders (see ―Principal Interest Holders‖ and ―Securities Offered‖).
K. Risks Associated With Financial Projections; VARIANCE IN REBATES
The financial projection discussion of the Company included in this Memorandum is based upon assumptions that the Company believes to be reasonable and/or on scenarios such as resourcerelated rebates that may or may not continue or may continue at different rates or amounts. Such assumptions may, for the foregoing and/or other reasons, be incomplete or inaccurate, and unanticipated events and circumstances may occur. For these reasons, actual results achieved during the periods covered may be materially and adversely different.
Even if the assumptions underlying the Company‘s plans prove to be correct, there can be no assurances that the Company shall not incur substantial operating losses in attaining its goals. The Company‘s plans are based on the premise that existing consumer demand for the
company's goods and services shall continue. However, there can be no assurances that the Company‘s objectives shall be realized if any of the assumptions underlying its plans prove to be incorrect.
Moreover, the Company‘s independent public accountants have not compiled or examined the documents, and accordingly, are unable to express an opinion or give any other form of assurance concerning such documents.
L. Limited Liquidity in the Absence of a Public Market
The Series A Common Membership Shares offered hereby are being offered in a private offering based upon available exemptions from federal and state securities laws. There is no public market in which Series A Common Membership Shares may be sold, and it is not anticipated that any such market shall develop in the foreseeable future. Therefore, purchasers of Series A Common Membership Shares should be prepared to hold their shares for an indefinite period of time.
M. Restrictions on Transfer of Securities
Investors shall own unregistered securities comprising a minority interest in a privately traded company. The Series A Common Membership Shares may not be transferable under certain state securities laws, which require registration or qualification. In such cases, the subscribers desiring to dispose of shares must deliver to the Company an opinion of counsel satisfactory to the Company to the effect that the proposed disposition of Series A Common Membership Shares shall not violate the registration or qualification requirement of relevant state securities law. The Subscription Agreement also provides that a shareholder seeking to sell Series A Common Membership Shares must first offer them to the Company which has the right of first refusal prior to the shares being sold. Because of potential restrictions on transferability of Series A Common Membership Shares, and the fact that no trading market exists or is expected to develop for the shares, holders of the Series A Common Membership Shares are not likely to be able to liquidate their investments or pledge the Series A Common Membership Shares as security on a loan in the event of an emergency. Thus, the Series A Common Shares should be considered only as a long-term investment. There can be no assurances that the Company shall be able to affect a public registration of its Series A Common Membership Shares, as its present level of business does not merit public ownership. In order to effect value from a public offering, a suitable underwriter must be located and a public market must be maintained following such offering. Typically, in an initial public offering existing shareholders are not permitted to sell their shares in such an offering, and are frequently required by the underwriter to ―lock-up‖ their shares for a period of time thereafter.
N. Determination of Offering Price
The offering price for the Series A Common Membership Shares described in this document was determined arbitrarily by the Company based upon a number of factors. Such price is based primarily on the amount of funds sought from this financing and the number of Series A Common Membership Shares the Board is willing to issue in order to raise such funds. Accordingly, there is no relationship between the price of the Offering and the assets, earnings or book value of the Company, the market value of the Series A Common Membership Shares, or any other recognized criteria of value. As such, the price does not necessarily indicate the current value of the Series A Common Membership Shares and should not be regarded as an indication of any future market price of the Company‘s Series A Common Membership Shares.
O. Best Efforts Offering
The Shares are offered by the Company on a ―best efforts‖ basis. No individual, firm or corporation has agreed in advance to purchase any of the offered Shares. No assurance can be given that any or all of the Shares shall be sold.
p. Working Capital Requirements
The Company intends to use the net proceeds of this Offering to acquire, operate and maintain key company assets and to fund ongoing working capital needs. Management shall have broad discretion to determine how such proceeds shall be used.
q. Facilities
The Company‘s corporate headquarters is located at 808 Energy, LLC: 5011 Argosy Avenue Suite 4, Huntington Beach, California, 92649. Although the Company‘s existing facilities are sufficient for its current needs, the Company could elect to move to larger quarters in the future, and while it does not anticipate any difficulty in locating the additional space required to accommodate the expansion of its operations there is no guarantee that such would prove to be the case.
r. Legal Matters
The Company is not a party to any pending legal actions or proceedings, and the Company is not aware that any such actions are likely to be initiated in the near future.
s. Previous Offerings
Since the Company commenced operations it has conducted no previous offerings.
t. Absence of Merit Review
Investors are cautioned that these securities have not been registered under the Securities Act and any state review by the securities administrators in some states in which interests may be offered and sold is limited to the form and compliance with certain disclosure requirements. No state authority has reviewed the accuracy or adequacy of the information contained herein nor has any regulatory authority made a merit review of the pricing of this Offering, the percentage of stock offered to Investors, or the compensation paid to officers or directors or other corporations under their control, and any dilutive factors therefrom. Therefore, Investors must recognize that they do not have all the protections afforded by securities laws to register or qualify offerings in states with merit reviews, and must therefore judge for themselves the adequacies of the disclosures, the amounts of compensation, the pricing, dilution and fairness of the terms of this Offering without benefit of prior merit review by authorities.
u. Risks Associated with Forward-Looking Statements Included in this Memorandum
This Memorandum contains certain forward-looking statements regarding the plans and objectives of management for future operations, including plans and objectives relating to the development of the Company‘s business. The forward-looking statements included herein are based on current expectations that involve numerous risks and uncertainties. The Company‘s plans and objectives are based on a successful execution of the Company‘s business strategy and assumptions that the Company shall be profitable, that the market for products or services shall not change materially or adversely, and that there shall be no unanticipated material adverse change in the Company‘s operations or business. Assumptions relating to any of the foregoing issues involve judgments with respect to, among other things, future economic, competitive and market conditions and business decisions (most of which are beyond the control of the Company), are difficult or impossible to predict accurately. Although the Company believes that its assumptions underlying the forward-looking statements are reasonable, any of the assumptions could prove inaccurate. As a result, there can be no assurance that the forward-looking statements included in this Memorandum shall prove to be accurate. In light of the significant uncertainties inherent in the forward-looking statements included herein, the inclusion of such information should not be regarded as a representation by the Company or any other entity that the objectives and plans of the Company shall be achieved.
v. Risks Associated with Government Regulation
The Company‘s ability to compete effectively with other companies shall depend, in part, on compliance with laws, regulations, rules and/or policies promulgated by the United States Department of Energy, the United States Environmental Protection Agency, other United States Agencies and/or various State, County and/or Municipal agencies in California, inter alia. In light of the uncertainties associated with said laws, regulations, rules and/or policies, there is no assurance that the Company‘s operations will continue unimpeded or at all. In addition, the
laws, regulations, rules and/or policies of other States, Counties and/or Municipalities where the Company will or may intend to conduct business activities and/or market its product(s) are not uniform with the laws, regulations, rules and/or policies of the United States or the aforementioned jurisdictions and there is no assurance that laws and regulations of such States, Counties and/or Municipalities will not materially and deleteriously impact the Company‘s planned business operations. W. TAX RISKS There are substantial risks associated with the Federal and state tax consequences of purchasing and owning Membership Shares and the tax implications of purchasing and owning Membership Shares are complex. The possibility of changes in federal income tax law could materially affect an Investor‘s tax benefits. Congress could make substantial changes in the future to the income tax consequences with respect to an investment in Membership Shares. Congress regularly considers proposals regarding changes to the federal income tax laws. The extent and effect of such changes, if enacted, are uncertain. As such, Investors should be aware that new administrative, legislative or judicial action could significantly change the tax aspects of an investment and such changes could have a material adverse affect on Investors. X. Risks Relating to Conflicts of Interest Affiliates of the LLC‘s Managing Member engage in other activities outside of the LLC that could cause conflicts of interest. The affiliates and the Managing Member will have conflicts of interest in allocating time, services and functions between various existing and future enterprises. The affiliates may organize other business ventures that may compete directly with the LLC. Further, the LLC and other enterprises of the affiliates may have common ownership and management personnel that may result in material conflicts of interest to the possible detriment of the Purchasers. Common ownership among the LLC and future Affiliates or Funds may present additional conflicts of interest with respect to the Member Interests. The LLC and its future Affiliates will share common management. This may lead to a conflict of interest between their various roles as owners or officers of the LLC and its Affiliates, including conflicts with the Members regarding decisions related to the LLC. NOTE: IN ADDITION TO THE ABOVE RISKS, BUSINESSES ARE OFTEN SUBJECT TO RISKS NOT FORESEEN OR FULLY APPRECIATED BY MANAGEMENT.
COMPANY EXECUTIVE SUMMARY
The Company
808 Energy, LLC (‗808 Energy‘, ‗the Company‘, and/or ‗Management‘) is a Nevada limited liability company. 808 Energy is a single purpose investment company, and a related entity of 808 Investments, LLC (―808 Investments‖) a California limited liability company and an Investment Banking Firm located in Huntington Beach, California. The founder and Managing Member of 808 Energy is Patrick Carter.
By way of background, 808 Investments strives to help America in its quest for renewable and green energy, to help reduce dependence on foreign oil. 808 Investments is committed to acquire or build 100 new green energy power plants, focusing on co-generation and solar technologies. 808 Investments has concluded agreements to purchase and/or develop several power plants and is well on its way to becoming a dominant player in the renewable energy market.
808 Energy is an investment company formed to pursue this exciting business initiative.
The current business climate is tremendously receptive to companies such as 808 Energy. Currently there are significant tax incentives and rebates for cogeneration facilities under the 2005 Energy Policy Act. As America tries to wean itself from dependence on foreign oil, these types of facilities are becoming increasingly relevant and profitable.
808 Energy Highlights
808 Energy has agreed to purchase the 1.4 MW Pacific Clay power plant from Southern Pacific Energy. The Pacific Clay plant is a low cost, on-site cogeneration power facility The acquisition of the Pacific Clay installation is structured without debt, thus revenues are insulated from debt service requirements
Customers such as Pacific Clay save an average of 30% on electrical and heating costs and enter long-term contracts for these critical resources 808 Energy receives recurring revenue, tax benefits, a 10-year payment commitment, equipment ownership and cost subsidies Profits to the plant owners come from the sale of electricity plus ―captured‖ excess waste heat Efficient energy plus less pollution equals lower costs and green status
A Debt-free installation
808 Energy will finance the acquisition of the Pacific Clay plant strictly from equity, avoiding the onerous debt service that plagues many energy installations. By way of example, Southern California Edison (SCE) grossed over $12 BB in its most recent fiscal year, yet its net income was a small fraction of that, at $1.2 BB. Debt service exerted an enormous downward drag on SCE‘s profitability – a problem 808 Energy avoids.
Management
Patrick Carter — Managing Member
Patrick began his career in the Financial Services sector in 1994 as a trader. He primarily focused on Index Options and Derivatives. In 1998 he made the switch to becoming a licensed Full Service Futures broker for a firm in California. After developing a successful methodology of trading Complex Derivative positions he left to open his own firm in 2000. After 5 years of running his own Futures and Options firm, he sold the company and accepted an offer from the Union Bank of Switzerland (UBS). While at UBS he furthered his licensing and now holds a Series 3,7,66, Health, Life, Disability, Annuity, Futures and Options Principal as well as being a Certified Wealth Management Expert. Patrick started 808 Investments, LLC to focus on Green Energy products in order to help America have less dependence on Foreign Oil. Patrick looks forward to a prosperous future with 808 and welcomes each investor as a potential Member of the 808 Family. Patrick lives with his wife and 2 year old son in Huntington Harbour, California.
Positioning
“Due to competitive pressures to cut costs and reduce emissions of air pollutants and greenhouse gasses, owners and operators of industrial and commercial facilities are actively looking for ways to use energy more efficiently. One option is cogeneration, also known as combined heat and power (CHP). Cogeneration/CHP is the simultaneous production of electricity and useful heat from the same fuel or energy. Facilities with cogeneration systems use them to produce their own electricity, and use the unused excess (waste) heat for process steam, hot water heating, space heating, and other thermal needs. They may also use excess process heat to produce steam for electricity production.” [2]
Cogeneration is a thermodynamically efficient use of fuel. In the separate production of electricity, some energy must be rejected as waste heat, but in cogeneration this thermal energy is put to good use.
A typical cogeneration system consists of an engine, steam turbine, or combustion turbine that drives an electrical generator. A waste heat exchanger recovers waste heat from the engine and/or exhaust gas to produce hot water or steam. Cogeneration produces a given amount of electric power and process heat with 10% to 30% less fuel than it takes to produce the electricity and process heat separately.
There are two main types of cogeneration concepts: "Topping Cycle" plants, and "Bottoming Cycle" plants. A topping cycle plant generates electricity or mechanical power first. Facilities that generate electrical power may produce the electricity for their own use, and then sell any excess power to a utility. Bottoming cycle plants are less common than topping cycle plants. These plants exist in heavy industries such as glass or metals manufacturing where very high temperature furnaces are used. A waste heat recovery boiler recaptures waste heat from a manufacturing heating process. This waste heat is then used to produce steam that drives a steam turbine to produce electricity. Since fuel is burned first in the production process, no extra fuel is required to produce electricity. [3]
Details of the Pacific Clay Plant
Pacific Clay, Inc., located in Lake Elsinore, California, is the largest brick producer in the western United States. The Pacific Clay energy plant, previously owned by Southern Pacific Energy, is currently online and generating the majority of the electrical power for Pacific Clay, Inc.
Cash Flow, Rebates and Tax Benefits
The Pacific Clay energy plant‘s ratio of Net Income to Gross Revenue (NI/GR) from its latest fiscal year is approximately 10.5% annually. There are applicable rebates given from the Federal and State governments as well as Pacific Clay‘s gas service provider. For the latest fiscal year the total rebates were $1.2 MM which, added to the energy plant‘s net income, equal an ROI of 50.5% based on an investment of $ 3 MM. While 808 Energy cannot predict what future rebates may or may not be, for the latest fiscal year the rebates were $.27 per Kilowatt hour and the plant used 6.5 MM Kilowatt hours. Any and all future rebates will be passed through to all Members of the LLC. In addition to the plant‘s net income and beneficial rebates there are significant tax benefits. The IRS currently allows an accelerated 50% depreciation for the first year and 12.25% each year thereafter until fully depreciated.
Benefits to Pacific Clay
Overall 30% reduction in cost of energy No capital outlay No maintenance fees or upkeep responsibilities ―Green Company‖ status
Investor Benefits
The $3 MM cost of the Pacific Clay plant is the typical ―turnkey‖ cost of a 1.2-1.3 MW Co-Generation Plant.; provided however, the Pacific Clay plant is a 1.4MW plant Significant tax credits and ―cash rebates‖ exist for the current Pacific Clay contract Monthly cash flow, tax benefits, and equity bonus No exposure to cost of fuel (clients pay fuel bill) plus ―take or pay‖ contracts reduce 808 Energy‘s exposure and risk Investment is collateralized by the energy plant
Industry Analysis
The Renewable Energy market is comprised of participants that engage in either the supply or demand of electricity generated via Geothermal, Solar, Wind and Hydroelectric means, as well as through wood and waste combustion. The volume of the market is calculated as the total volume of electricity consumed (in BBs of kilowatt hours, kWh).[4] The Americas account for 40.6% of the global renewable energy market's value. The global renewable energy market grew by 11.6% in 2007 to reach a value of $246 BB and a volume of 2,739.9 BB KWh. In 2012, the global renewable energy market is forecast to have a value of $398.7 BB, an increase of 62% from 2007, and is estimated to have a volume of 3,216.8 BB KWh. In recent years, investors worldwide have shown increased interest in the renewable energy industry. This has translated into rapid renewable energy commercialization and considerable industry expansion. By mid-2007, there were 140 publicly-traded renewable energy companies worldwide (or renewable energy divisions of major companies), up from 85 in mid-2006. As of mid-2007 each of these had a market capitalization greater than $40 MM. Between 2006 and 2007, several renewable energy companies went through high profile Initial Public Offerings, resulting in market capitalization near or above $1 BB. These corporations included the solar PV companies First Solar (USA), Trina Solar (USA), Centrosolar (Germany), and Renesola (U.K.), wind power company Iberdrola (Spain), and U.S. biofuels producers VeraSun Energy, Aventine, and Pacific Ethanol.
Berkshire-Hathaway Invests in Renewable Energy…
The following highlights recent acquisitions by Berkshire Hathaway Inc. in the energy industry. Berkshire Hathaway‘s recent energy investments are proof of increasing interests in, and faith that, energy investments will payoff in the coming years. BBaire investor Warren Buffett's holding company has revealed a new investment in power wholesaler NRG Energy Inc. SEC documents show Berkshire Hathaway holds 3.2 MM shares of the wholesale power generation company.[5]
Berkshire Hathaway has purchased electric utility PacifiCorp for $5.1 BB from Scottish Power. The purchase is Buffett's second-biggest deal ever and delivered on the famed investor's long-standing promise to expand his energy holdings. Berkshire will combine PacifiCorp with its majority-owned gas and electric utility MidAmerican Energy and create a company serving customers in 10 states.[6] Berkshire Hathaway‘s purchased of electric utility PacifiCorp signals a boom in rapidfire acquisition activity in energy. This year, 17.1% of the $427 BB in acquisitions have been in the energy industry. That's the highest concentration of energy deals on a dollar basis since at least 1990. And that's coming off last year's already strong year for energy
deals, when the number of deals jumped 11% to 615 and the value gained 103.6% to $110 BB.[7]
As Do Other Key Players…
The following samples of recent acquisitions emphasize the intense and growing interest in renewable energy: Bracewell & Giuliani LLP recently represented European renewable energy company Naturener S.A. in its acquisition of 100 percent of the capital of Energy Logics, Inc and Great Plains Wind & Energy, LLC. Naturener plans to develop 1,800 megawatts of wind energy in Alberta and Montana between 2007 and 2012, with a total estimated investment of $3 BB. (March 8, 2007)[8]
Vista International Technologies, Inc. announced it has signed a term sheet to acquire 100% of the stock of Maui Energy Company, an alternative energy company based on the Hawaiian Islands. (February 15, 2008)[9] Quantum Fuel Systems Technologies Worldwide, Inc. today announced that it has completed the acquisition of a 25% equity stake in ASOLA Advanced and Automotive Solar Systems GmbH (‖ASOLA‖), a leading German solar energy technology company that develops and manufactures high quality and high-efficiency photovoltaic modules for a number of innovative applications, including commercial, residential and automotive. (January 23, 2008)[10] PennWell Corporation, Tulsa, Okla., a diversified global media and information company, has acquired a 51% interest in iCommerce & Marketing L.L.C., which operates RenewableEnergyAccess.com, the world's leading online-only publication and businessto-business community for renewable energy. (January 1, 2008)[11] First Solar, Inc. announced that it has acquired Turner Renewable Energy, LLC for a purchase price of approximately $34.3 MM paid in a combination of common stock of First Solar, Inc. and cash. The company will operate as a wholly owned subsidiary of First Solar, Inc. under the name First Solar Electric, LLC. (November of 2007)[12]
Competitive Landscape
The competitive market is defined by the rapid introduction of innovative technologies and the subsequent emergence of companies utilizing these technologies. Those businesses that have proven their technologies to be of worth find themselves positioned as key contenders in one of the hottest and most lucrative industries today. Leading renewable energy companies include Acciona, Enercon, Gamesa, GE Energy, Q-Cells, Sharp Solar, SunOpta, Suntech, and Vestas.
Direct and Indirect Competition 808 Energy will compete most directly with electric service providers. While there are several competitors in the space, 808 Energy‘s business model is quite distinct. Larger competitors like Southern California Edison focus on much larger facilities. As such, they are not a direct competitor. One potential competitor is Capstone, however, this company has already expressed interest in forming a partnership with 808 Energy. 808 Energy is unique in that it is financing the Pacific Clay acquisition without debt.
Financial Strategy
808 Energy will seek a $3 MM initial round of financing during 2008 for the purchase of the Pacific Clay energy plant. These funds will be raised through the issuance of the Company‘s Series A Common Membership Shares via an offering to investment funds, strategic partners, other accredited investors, banks, and/or other groups.
Revenue and Cost Drivers…
Major revenue drivers for the company encompass the following corridors: sales of generated electricity and heat. The company‘s pro forma revenue projections indicate a ramp-up in gross revenue from around $ 2.1 MM in Y1 to over $ 3.7 MM by Y5 – with the core revenue driver being energy sales. Major cost drivers for the company include: capex (e.g., turbines and towers and/or solar modules as indicated); local development infrastructure fees and taxes; business development and strategic partner alignment; engineering costs; marketing and promotion, professional fees, general GS&A (including insurance, overhead and salaries. At the same time, a lean management and operations concept will help keep officer and staff salary expense within norms and will help drive attractive overall profit margins. More detailed information on revenues, costs, capex, headcount, and other data will be made available upon request.
Financial Statements
DISCLAIMER
The financial projections included above in this Offering Memorandum are the Company‘s projection of possible future results and are dependent on many factors over which the Company has no control. The Company cannot give any assurance that any of its assumptions on which the projections are based will prove to be correct.
The Company‘s management has prepared the projections. Its attorneys and independent accountants have not reviewed or examined the projections, and accordingly assume no responsibility for them. The projections were not prepared with a view to public disclosure or compliance with published guidelines of the Commission or any state securities commission, or the guidelines established by the American Institute of Certified Public Accountants. THE COMPANY ADVISES ALL PROSPECTIVE INVESTORS TO PURSUE THEIR OWN INDEPENDENT INVESTIGATION WITH RESPECT TO THE PROJECTED FINANCIAL INFORMATION INCLUDED IN THE BUSINESS PLAN.
USE OF PROCEEDS
Proceeds from Offering (1) $3,000,000 Less: Selling Expenses (2) $ N/A to this Offering Net Proceeds to the Company $3,000,000 Application of Net Proceeds: Building and Equipment, Working Capital & Reserves $3,000,000 Total Use of Proceeds $3,000,000 o Assuming all 120 Units are sold.
DESCRIPTION OF COMPANY UNITS
The Company‘s Authorized Units (25,000 Membership Shares/Unit) consist of 120 Units.
EXHIBIT A: SUBSCRIPTION AGREEMENT
In connection with the proposed issuance of Series A Common Membership Shares in 808 Energy, LLC, a Nevada, LLC (the ―Company‖), the undersigned prospective investor (―Investor‖) and the Company hereby agrees as follows:
1. Subscription. The investor hereby subscribes for the purchase of Series A Common Membership Shares and agrees to purchase the number of Series A Common Membership Shares set forth on the signature page of this Subscription Agreement at a price of $1.00 per Share. The Investor and the Company agree that this Subscription is and shall be irrevocable; however, the Company, in its sole discretion and for any reason, may accept or reject this Subscription Agreement, in whole or in part, at any time not later than 10 days after the date of this Subscription Agreement.
1. Option to Repurchase Series A Common Membership Shares . The Investor hereby agrees that the Company shall have the right, but not the obligation, to repurchase from the Investor, or the legal representative of the estate of the Investor (the ―Legal Representative‖), as the case may be, all of the Series A Common Membership Shares owned by the Investor for the purchase price determined below, to be paid in cash, on the Closing Date, as hereinafter defined.
The Company‘s right and option to repurchase the Series A Common Membership Shares owned by the Investor shall be exercised by written notice (the ―Notice of Exercise‖) given by the Company to the Investor or his Legal Representatives within thirty (30) days after the date of written notice to the Company from the Investor or his Legal Representatives of an election to sell the Series A Common Membership Shares. The Notice of Exercise shall state that the Company is electing to repurchase some or all of the Series A Common Membership Shares, and shall identify the number of Series A Common Membership Shares to be repurchased (as determined pursuant to this paragraph, the Closing Date and the proposed purchase price to be paid to the Investor. If the Company does not timely give a Notice of Exercise, the Company shall be deemed to have forever waived its option to repurchase the Series A Common Membership Shares. At the Closing Date, the Investor shall deliver a certificate or certificates representing the Series A Common Membership Shares to be repurchased by the Company, duly endorsed for transfer on the books and records of the Company free and clear of all liens, encumbrances and restrictions.
The repurchase of the Series A Common Membership Shares shall be consummated at the closing to be held on a date that is mutually agreeable to the Company and the Investor, but in no event more than thirty (30) days after the Notice of Exercise. Such transaction shall be
consummated at 10:00 a.m. on such date (the ―Closing Date‖) at the principal office of the Company or at such other time and place as the Company and the Investor mutually agree.
The purchase price shall be initially determined by the Investor and the Company and, if the parties are able to agree, then the amount determined shall be the Appraised Value.
If the Company and the Investor are unable to agree then the Appraised Value shall be determined by reference to an arms length completed financing with investors that has closed or is currently being offered by the Company to outside investors (the ―Outside Financing‖) made in or within six (6) months of the date of the Closing Date. If there is no Outside Financing within such six (6) month period, then the Appraised Value shall be determined by arbitration conducted in accordance with the rules and regulations then pertaining of the American Arbitration Association pursuant to Paragraph 4 below and the decision of the arbitrator shall be final and binding upon the parties. The parties shall endeavor to select an arbitrator. If the parties are unable to agree upon an arbitrator within a reasonable period of time, then the arbitrator shall be selected in accordance with the rules and regulations, then pertaining, of the American Arbitration Association. The arbitrator selected, shall be experienced in valuating companies in the Company‘s industry and sector and the arbitrator, in reaching a decision, shall take into account the methodology for determining the Appraised Value that was utilized by the Company in the most recent Outside Financing.
1. Representations and Warranties. The Investor makes the representations and warranties set forth below with the intent that the same may be relied upon in determining the Investor‘s suitability as a purchaser of Series A Common Membership Shares. If the Investor includes or consists of more than one person or entity, the obligations of the Investor shall be joint and several and the representations and warranties herein contained shall be deemed to be made by and be binding upon each person or entity and their respective heirs, executors, administrators, successors and assigns.
No Regulatory Review. The investor is aware that this Offering is a limited private offering and that no federal, state, or other agency has made any finding or determination as to the fairness of the investment nor made any recommendations or endorsement of the Series A Common Membership Shares . Ability to Evaluate. The Investor, by reason of the Investor‘s knowledge and experience in financial and business matters is capable of evaluating the risks and merits of an investment in the Series A Common Membership Shares . The Investor (i) understands that the Company is a development stage company, has a very limited operating history
and has no meaningful historical financial data upon which to estimate revenues and operating expenses and (ii) believes it has received all information and has conducted all of the due diligence it considers necessary or appropriate in deciding whether to purchase the Series A Common Membership Shares . The Investor has relied solely upon the advice of Investor‘s own tax and legal advisors with respect to the tax and other legal aspects of the investment in the Series A Common Membership Shares .
Investment Intent. The Investor acknowledges that the purchase of Series A Common Membership Shares hereunder is being made for the Investor‘s own account, for investment purposes only and not with the present intention of distributing or reselling the Series A Common Membership Shares in whole or in part. The Investor further understands that the Series A Common Membership Shares has not been registered under the Securities Act of 1933, as amended (the ―Act‖), or under any state securities laws by reason of specific exemptions therein, which depend upon, among other things, the accuracy of the Investor‘s representations as expressed in this Subscription Agreement. The Investor further understands that transfer of the Series A Common Membership Shares is restricted under the Act and under state securities laws. No Liquidity. The Investor has been advised that (i) it is unlikely that there will be a market for the Series A Common Membership Shares for a substantial period of time, or ever, (ii) there are substantial limitations on the Investor‘s ability to sell or transfer the Series A Common Membership Shares , and (iii) in any event, it may not be possible to readily liquidate the Investor‘s investment in the Series A Common Membership Shares . Confidentiality. The Investor understands that the Confidential Private Placement Memorandum provided to the Investor and any other information discussed with the Investor in connection with this Offering is confidential. The Investor has not distributed and will not distribute the Confidential Private Placement Memorandum and has not divulged and will not divulge the contents thereof or of any oral communication with the Company in connection with this Offering, to anyone other than such legal or financial advisors as the Investor deems necessary for purposes of evaluating an investment in the Series A Common Membership Shares and no one (except such advisors) has used the Confidential Private Placement Memorandum, and the Investor has not made any copies thereof. Authorization and Formation of Subscriber. The Investor, if a corporation, partnership, trust or other form of business entity, is authorized and otherwise duly qualified to purchase and hold Series A Common Membership Shares and such entity has not been formed for the specific purpose of acquiring Series A Common Membership Shares in this Offering. If the Investor is one of the aforementioned entities, it hereby agrees that upon request of the Company it will supply the Company with any additional written information that may be requested by the Company.
4. Arbitration. Any dispute arising out of or relating to an investment in its Series A Common Membership Shares must be handled in accordance with the rules and regulations of the American Arbitration Association, said arbitration to be binding on the parties. Additionally, each investor hereunder will be waiving the right to seek punitive damages, the right to trial by a jury and other potential remedies that otherwise may be afforded by law.
5. Governing Law. This Subscription Agreement shall be governed by and construed in accordance with the laws of the State of California, excluding therefrom the body of laws knows as Conflict of Laws or Choice of Laws; the parties intention being that substantive California Contract Law shall apply to this Subscription Agreement and to any and all disputes related thereto or arising therefrom.
6. Signatures. The Investor declares under penalty of perjury that the statements, representations and warranties contained herein are true, correct and complete and that this Subscription Agreement was executed at:______________________________ (City, State).
CERTIFICATE OF ACCREDITED INVESTOR STATUS
Except as may be indicated by the undersigned below, the undersigned is an ―accredited investor,‖ as that term is defined in Regulation D under the Securities Act of 1933, as amended (the ―Securities Act‖). The undersigned has checked the box below indicating the basis on which he is representing his status as an ―accredited investor‖:
□ 1) a bank as defined in Section 3(a)(2) of the Securities Act, or any savings and loan association or other institution as defined in Section 3(a)(5)(A) of the Securities Act whether acting in its individual or fiduciary capacity; a broker or dealer registered pursuant to Section 15 of the Securities Exchange Act of 1934, as amended (the ―Securities Exchange Act‖); an insurance company as defined in Section 2(13) of the Securities Act; an investment company registered under the Investment Company Act of 1940 or a business development company as defined in Section 2(a)(48) of that Act; a small business investment company licensed by the U.S. Small Business Administration under Section 301(c) or (d) of the Small Business Investment Act of 1958; a plan established and maintained by a state, its political subdivisions, or any agency or instrumentality of a state or its political subdivisions, for the benefit of its employees, and such plan has total assets in excess of $5,000,000; an employee benefit pla n within the meaning of the Employee Retirement Income Security Act of 1974, if the investment decision is made by a plan fiduciary, as defined in Section 3(21) of such Act, which is either a bank, savings and loan association, insurance company, or registered investment adviser, or if the employee benefit plan has total assets in excess of $5,000,000 or, if a self-directed plan, with investment decisions made solely by persons that are ―accredited investors‖; □ 2) a private business development company as defined in Section 202(a)(22) of the Investment Advisers Act of 1940; □ 3) an organization described in Section 501(c)(3) of the Internal Revenue Code, corporation, Massachusetts or similar business trust, or partnership, not formed for the specific purpose of acquiring the securities offered, with total assets in excess of $5,000,000; □ 4) a natural person whose individual net worth, or joint net worth with the undersigned‘s spouse, at the time of this purchase exceeds $1,000,000; □ 5) a natural person who had an individual income in excess of $200,000 in each of the two most recent years or joint income with the undersigned‘s spouse in excess of $300,000 in each of those years and has a reasonable expectation of reaching the same income level in the current year; □ 6) a trust with total assets in excess of $5,000,000, not formed for the specific purpose of acquiring the securities offered, whose purchase is directed by a person who has such knowledge and experience in financial and business matters that he is capable of evaluating the merits and risks of the prospective investment; or □ 7) an entity in which all of the equity holders are ―accredited investors‖ by virtue of their meeting one or more of the above standards. □ 8) an individual who is a director or executive officer of a company.
IN WITNESS WHEREOF, the undersigned has executed this Certificate of Accredited Investor Status effective as of ________________________, 2008.
Number of Series A Common Membership Shares: ___________________
Total purchase price: $ ________________________________________________________
Exact Name(s) in which ownership of Series A Common Membership Shares is to be registered:
___________________________________________________________________________
Address: ___________________________________________________________________
City, State, Zip Code: _________________________________________________________
Phone # (
) _______________________ Email _________________________________
Subscriber
Joint Subscriber: (if necessary)
________________________________________________________________________ (Print Name) (Print Name)
________________________________________________________________________ (Signature) (Signature)
SSN/ Tax ID # __________________________
Date: ___________________________ Date: _______________________________
Received and Accepted By:
________________________________ Date: _____________________________________ Patrick Carter, Managing Member 808 Energy, LLC