Form of Subscription and Investment Representation Agreement

Exhibit 10.3

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Newton Golf Company, Inc.

Series A Preferred Stock

FORM OF SUBSCRIPTION AND INVESTMENT REPRESENTATION AGREEMENT

THIS AGREEMENT is dated as of the date set forth on the signature page of this Agreement by and between Newton Golf Company, Inc., a Delaware corporation (the “Company”), and the undersigned subscriber (the “Subscriber”). In consideration of the mutual promises contained herein, and other good and valuable consideration, the parties hereto agree as follows:

1. Agreement of Sale.

a. The Company agrees to sell to Subscriber, and Subscriber agrees to purchase from the Company, up to that number of shares of Series A Preferred Stock of the Company, par value $0.01 per share (“Series A Preferred”), on Subscriber’s signature page (the “Securities”) in reliance upon the exemption from securities registration afforded by the provisions of Section 4(2) of the Securities Act of 1933, as amended (the “Securities Act”), or Regulation D promulgated thereunder (“Regulation D”). The terms of the Series A Preferred are included in the Certificate of Designation as set forth in Exhibit A hereto.

b. Closing. The completion of the sale and purchase of the Securities (the “Closing”) shall be held two (2) Business Days following the date of this Agreement, subject to the satisfaction of the conditions set forth herein (the “Closing Date”), at the offices of Faegre Drinker Biddle & Reath LLP, 2200 Wells Fargo Center 90 South Seventh Street, Minneapolis, Minnesota 55402, or at such other time and place as the Company and Subscriber may agree. The purchase price will be paid by the Subscriber at Closing in cash at the price per share of Series A Preferred equal to the greater of (i) $1.00 per share and (ii) the greater of (a) $0.01 above the per share closing price of the Company’s common stock on The Nasdaq Stock Market immediately preceding the execution date of this Agreement and (b) $0.01 above the average closing price of the Company’s common stock for the five (5) trading days immediately preceding the execution date of this Agreement.

c. Delivery of Securities. At the Closing, subject to the terms and conditions hereof, the Company will deliver to Subscriber a stock certificate or certificates (or book entry statement in lieu thereof), in such denominations and registered in such names as Subscriber may designate by notice to the Company, representing the Securities, dated as of the Closing Date, against payment of the purchase price therefor by cash in the form of wire transfer pursuant to the wire instructions delivered to the Investor by the Company.

2. Representations and Warranties of Subscriber. In consideration of the Company’s offer to sell the Securities, Subscriber hereby represents and warrants to the Company as follows:

a. Information About the Company. Subscriber has made such independent investigation of the Company, its management, its financial condition, and related matters as Subscriber deems necessary or advisable in connection with the purchase of the Securities. Subscriber and Subscriber’s representatives have been afforded a full opportunity to ask questions of and receive answers from Company management about the business and affairs of the Company, and to examine all such documents, materials, and information concerning the Company as Subscriber or such representatives deem to be necessary or advisable in order for Subscriber to reach an informed decision concerning whether to make an investment in the Company. Subscriber confirms that all of Subscriber’s and any of Subscriber’s representatives’ requests or questions have been answered to their full satisfaction and no request or question has been denied or remains unfulfilled or unanswered.

b. Restrictions on Transfer. Subscriber represents and warrants that the Securities are being purchased for Subscriber’s own account and for Subscriber’s investment and without the intention of reselling or redistributing the same, that Subscriber has made no agreement with others regarding any of such Securities and that Subscriber’s financial condition is such that it is not likely that it will be necessary to dispose of any of the Securities in the foreseeable future. Subscriber is aware that, in the view of the Securities and Exchange Commission, a purchase of the Securities with an intent to resell by reason of any foreseeable specific contingency or anticipated change in market values, or any change in the condition of the Company, or in connection with a contemplated liquidation or settlement of any loan obtained for the acquisition of the Securities and for which the Securities were pledged as security, would represent an intent inconsistent with the representations set forth above. Subscriber understands that the Securities have not been registered under the Securities Act, or any state or foreign securities laws in reliance on exemptions from registration under both such acts, and that, accordingly, the Securities may not be resold by the undersigned unless they are registered under both the Securities Act, as amended, and applicable state or foreign securities laws or are sold in transactions which are exempt from such registration. Subscriber therefore agrees not to sell, assign, transfer or otherwise dispose of the Securities unless a registration statement relating thereto has been duly filed and become effective under the Securities Act, as amended, and applicable state or foreign securities laws, or unless in the opinion of counsel satisfactory to the Company no such registration is required under the circumstances. There is not currently, and it is unlikely that in the future there will exist, a public market for the Securities; and accordingly, for the above and other reasons, Subscriber may not be able to liquidate an investment in the Securities for an indefinite period.

c. High Degree of Risk. Subscriber realizes that an investment in the Securities involves a high degree of risk, including the risks of receiving no return on the investment and of losing Subscriber’s entire investment in the Company. Subscriber is able to bear the economic risk of investment in the Securities, including the total loss of such investment. The Company can make no assurance regarding its future financial performance or as to the future profitability of the Company.

d. Suitability. Subscriber has such knowledge and experience in financial and business matters that Subscriber is capable of evaluating the merits and risks of an investment in the Securities. Subscriber has obtained, to the extent deemed necessary, Subscriber’s own personal professional advice with respect to the risks inherent in, and the suitability of, an investment in the Securities in light of Subscriber’s financial condition and investment needs. Subscriber believes that the investment in the Securities is suitable for Subscriber based upon Subscriber’s investment objectives and financial needs, and Subscriber has adequate means for providing for Subscriber’s current financial needs and personal contingencies and has no need for liquidity of investment with respect to the Securities. Subscriber understands that no federal or state agency has made any finding or determination as to the fairness for investment, nor any recommendation or endorsement, of the Securities.

e. Tax Liability. Subscriber has reviewed with Subscriber’s own tax advisors the federal, state, local and foreign tax consequences of this investment and the transactions contemplated by this Agreement, and has and will rely solely on such advisors and not on any statements or representations of the Company or any of its agents. Subscriber understands that Subscriber (and not the Company) shall be responsible for Subscriber’s own tax liability that may arise as a result of this investment or the transactions contemplated by this Agreement. Under penalties of perjury, Subscriber certifies that (a) the number shown on the signature page below is Subscriber’s correct social security or taxpayer identification number and (b) Subscriber is not subject to back-up withholding either because Subscriber has not been notified that Subscriber is subject to back-up withholding as a result of a failure to report all interest and dividends, or because the Internal Revenue Service has notified Subscriber that Subscriber is no longer subject to back-up withholding.

f. Residence. Subscriber’s principal residence or business address, and the location where the securities are being purchased, is Subscriber’s address listed below.

g. Limitation Regarding Representations. Except as set forth in this Agreement, no representations or warranties have been made to Subscriber by the Company or any agent, employee or affiliate of the Company and in entering into this transaction, Subscriber is not relying on any information, other than that contained herein and the results of independent investigation by Subscriber. Subscriber agrees it is not relying on any oral or written information not expressly included in this Agreement, including but not limited to the information which has been provided by the Company, its directors, its officers or any affiliate of any of the foregoing.

h. Authority.

i. Entity. If the undersigned is not an individual but an entity, the individual signing on behalf of such entity and the entity jointly and severally agree and certify that (a) the undersigned was not organized for the specific purpose of acquiring the Securities and (b) this Agreement has been duly authorized by all necessary action on the part of the undersigned, has been duly executed by an authorized officer or representative of the undersigned, and is a legal, valid and binding obligation of the undersigned enforceable in accordance with its terms.

ii. Individual. If the undersigned is an individual, the undersigned is of legal age.

i. Accredited Status. Subscriber represents that it does qualify as an “accredited investor” as that term is defined in Regulation D under the Securities Act because the undersigned satisfies the criteria indicated on the signature page hereto. Subscriber further represents and warrants that the information provided under the heading “Accredited Investor Status” on the signature page to this Agreement is true and correct. The information provided under this section is required in connection with the exemptions from the Securities Act and state securities laws being relied on by the Company with respect to the offer and sale of the Securities. The undersigned agrees to furnish any additional information which the Company or its legal counsel deem necessary in order to verify the responses set forth above.

j. Holding Status. Subscriber desires that the Securities be held as set forth on the signature page hereto.

k. No General Solicitation. Subscriber did not learn of the investment in the Securities as a result of any public advertising or general solicitation.

3. Representations and Warranties of the Company. The Company represents and warrants to Subscriber that:

a. Authority. The Company is a corporation duly formed, validly existing, and in good standing under the laws of the state of Delaware. The Company has all requisite corporate power and authority to own, license, and operate its properties, to carry on its business as now conducted and as proposed to be conducted, and to execute and deliver this Agreement and to perform its obligations hereunder.

b. Authorization; Enforceability. The execution and delivery by the Company of this Agreement and the consummation by the Company of the transactions contemplated hereby have been duly authorized by all necessary corporate action on the part of the Company. This Agreement has been duly executed and delivered by the Company and constitutes a legal, valid, and binding obligation of the Company, enforceable against the Company in accordance with its terms, except as may be limited by bankruptcy, insolvency, reorganization, moratorium, and other similar laws of general applicability relating to or affecting creditors’ rights or general equity principles (regardless of whether considered at law or in equity).

c. Validity of Purchased Securities. Prior to the Closing, the Securities will have been duly authorized and, when issued and paid for in accordance with the terms of this Agreement, will be duly and validly issued to Subscriber, free and clear of any Liens, except for restrictions on transfer provided for herein or under the Securities Act or other applicable securities laws.

d. No Directed Selling Efforts or General Solicitation. Neither the Company nor any Person acting on its behalf has conducted any general solicitation or general advertising (as those terms are used in Regulation D) in connection with the offer or sale of any of the Shares.

4. Legend. Subscriber consents to the inscription on the certificate or certificates representing the Securities of the following legend reciting the above restrictions on the transferability of the Securities:

The Securities represented by this certificate have not been registered under the Securities Act of 1933, as amended (the “Securities Act”), and have not been registered under any state securities laws. These Securities may not be sold, offered for sale or transferred without first obtaining (i) an opinion of counsel satisfactory to the Company that such sale or transfer lawfully is exempt from registration under the Securities Act and under the applicable state securities laws or (ii) such registration.

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**PARAGRAPH 4 IS REQUIRED IN CONNECTION WITH THE EXEMPTIONS FROM THE SECURITIES ACT AND STATE LAWS BEING RELIED ON BY THE COMPANY WITH RESPECT TO THE OFFER AND SALE OF THE SECURITIES. ALL OF SUCH INFORMATION WILL BE KEPT CONFIDENTIAL AND WILL BE REVIEWED ONLY BY THE COMPANY AND ITS COUNSEL. THE UNDERSIGNED AGREES TO FURNISH ANY ADDITIONAL INFORMATION THAT THE Company AND ITS COUNSEL DEEM NECESSARY TO VERIFY THE RESPONSES SET FORTH BELOW. **

5. Confidentiality. Subscriber will make no written or other public disclosures regarding the Company and its business, the terms or existence of the proposed sale of Securities or regarding the parties to the proposed sale of Securities to any individual or organization without the prior written consent of the Company, except as may be required by law.

6. Notice. Correspondence regarding the Securities should be directed to Subscriber at the address printed below. Subscriber is a bona fide resident of the state listed below.

7. No Assignment or Revocation; Binding Effect. Neither this Agreement, nor any interest herein, shall be assignable by Subscriber without prior written consent of the Company. Subscriber hereby acknowledges and agrees that Subscriber is not entitled to cancel, terminate or revoke this Agreement and that it shall survive the death, incapacity or bankruptcy of Subscriber. The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto, and their respective heirs, legal representatives, successors and assigns.

8. Remedies. The Subscriber acknowledges that the Company may not have an adequate remedy at law in the event of any breach of this Agreement by the Subscriber and, therefore, the Company will be entitled, in addition to any other available remedies, to injunctive and/or other equitable relief to prevent or remedy a breach of this Agreement and to attorneys’ fees and other costs incurred by the Company in commencing suit or taking other action to enforce the terms and conditions of this Agreement.

9. Modifications. This Agreement may not be changed, modified, released, discharged, abandoned or otherwise amended, in whole or in part, except by an instrument in writing, signed by the Subscriber and the Company. No delay or failure of the Company in exercising any right under this Agreement will be deemed to constitute a waiver of such right or of any other rights.

10. Expenses. The parties hereto shall pay their own costs and expenses in connection herewith.

11. Entire Agreement. This Agreement and the exhibits hereto are the entire agreement between the parties with respect to the subject matter hereto and thereto. This Agreement, including the exhibits, supersede any previous oral or written communications, representations, understandings or agreements with the Company or with any officers or representatives of the Company.

12. Severability. In the event that any paragraph or provision of this Agreement shall be held to be illegal or unenforceable in any jurisdiction, such paragraph or provision shall, as to that jurisdiction, be adjusted and reformed, if possible, in order to achieve the intent of the parties, and if such paragraph or provision cannot be adjusted and reformed, such paragraph or provision shall, for the purposes of that jurisdiction be voided and severed from this Agreement, and the entire Agreement shall not fail on account thereof but shall otherwise remain in full force and effect.

13. Governing Law. This Agreement shall be governed by, subject to, and construed in accordance with the laws of the State of Delaware without regard to conflict of law principles. Any legal suit, action, or proceeding arising out of or based upon this Agreement or the transactions contemplated hereby may be instituted in the federal courts of the United States of America or the courts of the State of Delaware in each case located in the county of Wilmington, and each party irrevocably submits to the exclusive jurisdiction of such courts in any such suit, action, or proceeding. Service of process, summons, notice, or other document by certified or registered mail to such party’s address set forth herein shall be effective service of process for any suit, action, or other proceeding brought in any such court. The parties irrevocably and unconditionally waive any objection to the laying of venue of any suit, action, or any proceeding in such courts and irrevocably waive and agree not to plead or claim in any such court that any such suit, action, or proceeding brought in any such court has been brought in an inconvenient forum.

14. Survival of Representations and Warranties; Indemnification. Subscriber understands the meaning and legal consequences of the agreements, representations and warranties contained herein, agrees that such agreements, representations and warranties shall survive and remain in full force and effect after the execution hereof and payment for the Securities, and further agrees to indemnify and hold harmless the Company and each current and future officer, director, employee, agent and member of the Company from and against any and all loss, damage or liability due to, or arising out of, a breach of any agreement, representation or warranty of the undersigned contained herein.

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For good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, Subscriber hereby agrees that by signing this Subscription and Investment Representation Agreement, and upon acceptance hereof by the Company, that the terms, provisions, obligations and agreements of this Agreement, shall inure to the benefit of and be binding upon Subscriber and its successors and assigns.

Execution of this agreement shall also constitute our joinder signature page to our limited liability company agreement, a copy of which has been provided to you with this Subscription and Investment Representation Agreement.

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Date:______________________

The Subscriber desires that the Securities be held as follows (check one):

* If Securities are being subscribed for by an entity, the Legal Entity Subscriber Form to this agreement must also be completed.

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The Company hereby accepts the subscription evidenced by this Subscription and Investment Representation Agreement:

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ACCREDITED INVESTOR CRITERIA
[Mark as applicable]

_____  the investment decision is made by a plan fiduciary, as defined in Section 3(21) of the Securities Act, which is either a bank, savings and loan association, insurance company, or registered investment adviser; or

_____  the employee benefit plan has total assets in excess of $5,000,000; or

_____  the plan is a self-directed plan with investment decisions made solely by persons who are “Accredited Investors” as defined under the Securities Act.

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LEGAL ENTITY SUBSCRIBER
CERTIFICATE OF SIGNATORY

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Name of Subscriber:_________________________________________________________________________

☐ Corporation    ☐ Partnership    ☐ Trust    ☐ Limited Liability Company    ☐ Other ______________

Date Organized: ____________________________________________________________________________

Purpose of Organization: ______________________________________________________________________

  ____________________________________________________________________

Federal Tax ID # :___________________________________________________________________________

__________________________________________________________________________________

__________________________________________________________________________________

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NOTE: A power of attorney or other evidence of authority is required if the Partnership, Limited Liability Company or Trust Agreement or bylaws do not specifically authorize the above-named individual(s) to make this investment for the Partnership, Corporation, Limited Liability Company or Trust. In any event, authorizing documents should accompany this Investment Letter.

This Certificate of Signatory has been executed as of the date printed below by the authorized person listed below.

Exhibit A

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Certificate of Designation

[Intentionally omitted.]