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EXHIBIT 3.5
3.5 SUBSCRIPTION AGREEMENT, REGULATION D, RULE 506
SUBSCRIPTION AGREEMENT
HYPERBARIC SYSTEMS
A CALIFORNIA CORPORATION
THE COMMON STOCK (THE STOCK) REFERRED TO HEREIN HAS NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE ACT), OR QUALIFIED
UNDER THE CORPORATE SECURITIES LAWS OF THE STATE OF CALIFORNIA OR ANY OTHER
STATE OR JURISDICTION. THE STOCK IS SOMETIMES REFERRED TO HEREIN AS THE
"SECURITIES". THE SECURITIES MUST BE ACQUIRED FOR INVESTMENT PURPOSES AND NOT
WITH A VIEW TO DISTRIBUTION OR RESALE, AND MAY NOT BE SOLD, MORTGAGED, PLEDGED,
HYPOTHECATED, OR OTHERWISE TRANSFERRED WITHOUT REGISTRATION OF SUCH SECURITIES
UNDER THE ACT UNLESS AN EXEMPTION FROM APPLICABLE FEDERAL AND STATE SECURITIES
LAWS IS OR BECOMES AVAILABLE AND THE HOLDER OF THE SECURITIES PROVIDES TO
HYPERBARIC SYSTEMS, PRIOR TO SUCH TRANSFER, AN OPINION OF COUNSEL, SATISFACTORY
TO HYPERBARIC SYSTEMS AND ITS COUNSEL, THAT THE TRANSFER OF THE SECURITIES DOES
NOT VIOLATE ANY APPLICABLE FEDERAL OR STATE SECURITIES LAWS.
This Subscription Agreement is made by and between HyperBaric
Systems, a California corporation (the "Company") and the undersigned
prospective purchaser who is subscribing hereby for the Securities.
In consideration of the Company's agreement to accept the
undersigned as a holder of Stock upon the terms and conditions set forth herein,
the undersigned agrees and represents as follows:
A. SUBSCRIPTION
1. By executing this Subscription Agreement ("Agreement"),
the undersigned agrees to purchase that number of shares of Stock as is set
forth on the signature page hereof, upon acceptance of this offer by the
Company, and tenders payment in full herewith for such Securities (the
"Payment").
2. The Payment will be returned promptly, without interest,
in the event that for any reason the purchase and sale of the Securities
subscribed for hereby is not consummated within 30 days following the date this
Subscription Agreement is duly executed and delivered by the undersigned (such
date is hereinafter referred to as the Closing Date) or in the event that the
undersigned's subscription is rejected.
B. GENERAL REPRESENTATIONS AND WARRANTIES
1. The undersigned hereby represents and warrants to, and
agrees with the Company, as follows:
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(a) The Securities are being purchased for his own
account, for investment purposes only, and not for the account of any other
person, and not with a view to distribution, assignment or resale to others or
to fractionalization in whole or in part. The Securities are offered pursuant to
exemptions provided by the Act and by exemptions set forth in certain state
securities laws and certain rules and regulations promulgated pursuant thereto.
In furtherance thereof, the undersigned represents, warrants, and agrees as
follows: (i) no other person has or will have a direct or indirect beneficial
interest in such Securities and the undersigned will not sell, hypothecate or
otherwise transfer the Securities except in accordance with the Act and
applicable state securities laws or unless, in the opinion of counsel for the
Company, an exemption from the registration requirements of the Act and such
laws is available; and (ii) the Company is under no obligation to register the
Securities on behalf of the undersigned or to assist him in complying with any
exemption from registration.
(b) The undersigned has been furnished with and has
carefully read and fully understands the contents of the Company's Offering
Memorandum (the "Memorandum") and has read and fully understands the terms of
this Agreement and any other agreement delivered in connection herewith, and
acknowledges that any questions he may have had regarding the statements
contained in the Memorandum or the terms of this Agreement have been fully
answered to his satisfaction.
(c) In evaluating the suitability of an investment
in the Company, the undersigned has not relied upon any representations or other
information (whether oral or written) from the Company, or any of its agents
other than as set forth in the Memorandum and, if applicable, written
information from the Company provided in response to questions or requests for
additional information and has not relied on any other representations,
warranties or information (whether oral or otherwise) and no oral or written
representations or warranties have been made or oral or written information
furnished to the undersigned or his advisors, if any, in connection with the
offering of the Securities which were in any way inconsistent with the
Memorandum.
(d) The undersigned has been given the opportunity
to ask questions of the Company and to obtain any additional information from
the Company which the undersigned and his purchaser representative, if any,
deemed pertinent to this investment; any questions that were asked have been
fully answered, and any information that was requested has been provided.
(e) The undersigned recognizes the Company has only
recently been organized and that it has limited financial or operating history
and that investment in the Company involves substantial risks, and he has taken
full cognizance of and understands all of the risk factors related to the
purchase of the Securities. Accordingly, the undersigned represents that he
fully understands that this is a highly speculative investment and that there
are substantial risks that the undersigned will suffer a complete loss of his
investment in the Securities.
(f) The undersigned has carefully considered and
has, to the extent he believes such discussion necessary, discussed with his
professional legal, tax and financial advisers the suitability of an investment
in the Company for his particular tax and financial situation and he has
determined that the Securities are a suitable investment for him.
(g) All information which the undersigned has
previously provided to the Company concerning himself and his financial position
and knowledge of financial, business and
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investment matters is correct and complete as of the date of the date hereof,
and if there has been or is any change in such information prior to the
acceptance of this subscription, he has or will immediately provide such
information to the Company and will promptly send confirmation of such
information to the Company.
(h) The undersigned understands that the offering of
the Securities has not been and will not be registered under the Act in reliance
on the exemption for offerings provided by Section 4(2) of the Act and Rule 505
and certain other regulations promulgated thereunder and that the undersigned
has no right to require such registration. The undersigned further understands
that the offering of the Securities has not been and will not be qualified or
registered under state securities laws in reliance upon exemptions under such
laws for non-public offerings, and, in part, in reliance upon the
representations made and information furnished by the undersigned herein; and
that neither the offering of the Securities, nor the Memorandum have been
reviewed by the Securities and Exchange Commission or any state securities
authorities.
(i) The undersigned, or if the undersigned is an
entity, the person making the investment decision on behalf of the entity, has
the capacity, by reason of the undersigned's or such person's business or
financial experience (or that of the undersigned's purchaser representative) to
evaluate the merits and risks of an investment in the Securities and to protect
the undersigned's own interests in connection with such investment and the
undersigned is able to bear the economic risk of such investment.
2. The foregoing representations and warranties are true
and accurate as of the date hereof, shall be true and accurate as of the date of
the acceptance hereof by the Company and shall survive thereafter. If such
representations and warranties shall not be true and accurate in any respect,
the undersigned will, prior to such acceptance, give written notice of such fact
to the Company specifying which representations and warranties are not true and
accurate and the reasons therefor.
3. The undersigned shall indemnify and hold harmless the
Company and any of its shareholders, officers, directors, employees, partners,
counsel or agents who was or is a party or is threatened to be made a party to
any threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative, by reason of or arising from any
actual or alleged misrepresentation or misstatement of facts or omission to
represent or state facts made by the undersigned to the Company concerning
himself or his financial position in connection with the offering or sale of the
Securities which is not remedied by timely notice to the Company as provided
above, against losses, liabilities and expenses for which the Company or any of
its shareholders, officers, directors, employees, counsel or agents have not
otherwise been reimbursed (including attorneys fees, judgments, fines and
amounts paid in settlement) as actually and reasonably incurred by such person
or entity in connection with such action, suit or proceeding.
C. INVESTOR INFORMATION
The undersigned (if the undersigned is a natural person) or the
individual making the investment decision for the undersigned (if the
undersigned is a partnership, corporation, trust or other entity, (the
"Subscribing Person") represents that the undersigned is an Accredited Investor
within the definition in Rule 501 of Regulation D as promulgated under the
Securities
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Act of 1933, as amended, and as set forth in the Private Placement Memorandum.
The undersigned also represents that the undersigned has no need for liquidity
of the amount invested and the investment does not represent more than 10% of
the undersigned's liquid net worth.
In furnishing and, if necessary, updating the information
provided to the Company, I acknowledge that the Company will be relying thereon
in determining, among other things, whether there are reasonable grounds to
believe that I qualify as a purchaser under exemptions provided by the Act and
by certain state securities laws and certain rules and regulations promulgated
pursuant thereto.
D. UNDERSTANDINGS
1. The undersigned understands, acknowledges and agrees
with the Company as follows:
(a) This Subscription may be rejected, in whole or
in part, by the Company in its sole discretion, at any time prior to the
execution and delivery hereof by the Company, notwithstanding prior receipt by
the undersigned of notice of acceptance of the undersigned's subscription.
(b) This Subscription is and shall be irrevocable,
except that the undersigned shall have no obligations hereunder in the event
that: (i) this subscription is rejected for any reason or (ii) the purchase and
sale of the Securities subscribed for hereby are not consummated.
(c) No federal or state agency has made any finding
or determination as to the fairness of this offering for investment, nor any
recommendation or endorsement of the Securities.
(d) There is no public market for the Securities or
any other securities which the Company may offer and there is no certainty that
such a market will ever develop. There can be no assurance that the undersigned
will be able to sell or dispose of the Securities. Moreover, no assignment,
sale, transfer, exchange or other disposition of the Securities can be made
other than in accordance with all applicable securities laws. It is understood
that in order not to jeopardize the offering's exempt status under the Act and
under certain state securities laws, the transferee may at a minimum be required
to fulfill investor suitability requirements.
(e) The undersigned acknowledges that any financial
illustrations, projections or forecasts provided to the undersigned in
connection with this investment do not constitute predictions regarding future
financial results of the Company or a return on an investment in the Securities,
are based on a number of assumptions as to future events that may not occur or
may occur differently than assumed, and that actual results will in all
probability differ from the results illustrated and that such differences could
be material.
(f) The undersigned acknowledges that the
information contained in the Memorandum is confidential and non-public and
agrees that all such information shall be kept in confidence by him and neither
used by him to his personal benefit nor disclosed to any third party for any
reason (other than in connection with his subscription for the Securities);
provided, that this obligation shall not apply to any such information which:
(i) is part of the public
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knowledge or literature and readily accessible at the date hereof; (ii) becomes
part of the public knowledge or literature and readily accessible by publication
(except as a result of a breach of these provisions); or (iii) is received from
third parties (except third parties who disclose such information in violation
of any confidentiality agreements including, without limitation, any
Subscription Agreement they may have with the Company).
(g) The undersigned has had prior personal or
business relationships with the Company or its officers or directors or General
Partners, or officers or directors or General Partners of the Company, or by
reason of his business or financial experience, has the capacity to protect his
own interest in connection with this transaction.
2. The representations, warranties, understandings,
acknowledgments and agreements in this Agreement are true and accurate as of the
date hereof, shall be true and accurate as of the date of the acceptance hereof
by the Company and shall survive thereafter.
E. MISCELLANEOUS
1. All pronouns and any variations thereof used herein
shall be deemed to refer to the masculine, feminine, neuter, singular or plural
as the identity of the person or persons may require.
2. Neither this Subscription Agreement nor any provisions
hereof shall be waived, modified, changed, discharged, terminated, revoked or
canceled except by an instrument in writing signed by the party against whom any
such waiver, modification, change, discharge, termination, revocation or
cancellation is sought.
3. Notices required or permitted to be given hereunder
shall be in writing and shall be deemed to be sufficiently given when personally
delivered or sent by registered mail, return receipt requested, addressed to the
other party at the address of such party set forth herein, or to such other
address furnished by notice given in accordance with this Article E.
4. Failure of the Company to exercise any right or remedy
under this Subscription Agreement or any other agreement between the Company and
the undersigned, or otherwise, or delay by the Company in exercising such right
or remedy, shall not operate as a waiver thereof. No waiver by the Company shall
be effective unless and until it is in writing and signed by the Company.
5. This Subscription Agreement shall be enforced, governed
and construed in all respects in accordance with the laws of the State of
California, as such laws are applied by California courts to agreements entered
into and to be performed in California by and between residents of California,
and shall be binding upon the undersigned, his heirs, estate, legal
representatives, successors and assigns and shall inure to the benefit of the
Company and its successors and assigns.
6. In the event that any provision of this Subscription
Agreement is declared invalid or unenforceable by a court of competent
jurisdiction under any applicable statute or rule of law, then such provision
shall be deemed inoperative to the extent that it may conflict therewith and
shall be deemed modified to conform with such statute or rule of law. Any
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provision hereof which may prove invalid or unenforceable under any law shall
not affect the validity or enforceability of any other provision hereof.
7. This Subscription Agreement constitutes the entire
agreement among the parties hereto with respect to the subject matter hereof and
supersedes any and all prior or contemporaneous representations, warranties,
agreements and understandings in connection therewith. This Subscription
Agreement may be amended only by a writing executed by all parties hereto:
8. Title to the Securities shall be taken as follows:
(check one):
( ) Husband and wife, as community property;
( ) Joint Tenants;
( ) Tenants in common;
( ) Separate property;
( ) Living Trust;
( ) Corporation (Attach copy of resolution authorizing
this investment);
( ) Partnership (Attach copy of partnership agreement);
( ) Custodian, Trustee (Attach copy of agreement);
( ) Other:
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HYPERBARIC SYSTEMS
SUBSCRIPTION AGREEMENT
SIGNATURE PAGE
This page constitutes the signature Page for the Subscription
Agreement. The undersigned represents to you that (a) the information contained
herein is complete and accurate on the date hereof and may be relied upon by you
and (b) the undersigned will notify you immediately of any change in any of such
information occurring prior to the acceptance of the subscription and will
promptly send you written confirmation of such change. The undersigned hereby
certifies that he has read and understands the Memorandum and this Subscription
Agreement.
IN WITNESS WHEREOF, the undersigned has executed this Subscription
Agreement this ______day of _____________, 1999.
$
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Number of Shares of Total Purchase Price
Common Stock
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NAME OF PURCHASER
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Signature
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Title of Authorized Signature if
Purchaser is a corporation, partnership
or other entity
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Signature of Spouse or Co-Owner
