EXHIBIT 10.24

 

Consulting Agreement

 

This Consulting Agreement (“Agreement”), effective as of March 10, 2015
(“Effective Date”) is entered into by and between Ruthigen, Inc., a Delaware
corporation (herein referred to as the “Company”) and Robert B. Prag (herein
referred to as the “Consultant”).

 

RECITALS

 

WHEREAS, Company desires to engage Consultant to assist in business development,
strategic relationships and strategic planning, and assisting with writing
corporate collateral material and press releases;

 

NOW THEREFORE, in consideration of the promises and the mutual covenants and
agreements hereinafter set forth, as well as previous services rendered, the
parties hereto covenant and agree as follows:

 

1.           Term. Company hereby agrees to retain Consultant for a period
commencing on the effective date of the merger pursuant to which Pulmatrix, Inc.
(“Pulmatrix”), a Delaware corporation, becomes a wholly-owned subsidiary of the
Company pursuant to a Merger Agreement to which the Company and Pulmatrix are or
will be parties (the “Commencement Date”) and ending on August 31, 2016 (such
period, the “Term”).

 

2.           Duties of Consultant. From the commencement of this Agreement up
and until termination, Consultant agrees that he will generally provide the
following specified duties:

 

(a)Assist the Company’s management team in developing and implementing business
development strategies and initiatives;

 

(b)Introduce the Company’s management to prospective customers, resellers, and
strategic relationships with respect to the Company’s products and services;

 

(c)Assist the Company’s management in negotiating business development and
strategic relationships with prospective customers, resellers, and strategic
relationships;

 

(d)Assist the Company’s management with respect to presenting the Company’s
products and its business offerings to prospective customers, resellers, and
strategic relationships;

 

(e)Upon and with the Company management's direction, conduct meetings, in person
or by telephone, with prospective customers, resellers, and strategic
relationships;

 

(f)Review business plans, strategies, budgets, proposed transactions and other
plans for the purpose of assisting the Company’s management on matters
concerning prospective customers, resellers, and strategic relationships;

 

(g)Assist in creating collateral material for the Company including sales
presentation, powerpoints and press releases.

 

 

 

  

(h)Assist management with respect to corporate symbols, logos, names, the
presentation of such symbols, logos and names, and other matters relating to
corporate image;

 

(i)Perform the functions generally assigned to internal stockholder relations
departments in public corporations, including responding to telephone and
written inquiries, preparing press releases for the Company with the Company
managements’ involvement and approval of press releases, reports and other
communications with or to shareholders, assisting with respect to the timing,
form, distribution and other matters related to such releases, reports and
communications;

 

3.           Allocation of Time and Non-exclusive Relationship. Consultant
hereby promises to perform and discharge faithfully the responsibilities which
may be assigned to Consultant from time to time by the Company’s management in
connection with this Consulting Agreement. It is understood that are no specific
number of days per week or hours per day are required by this Agreement, but
rather during the Term, Consultant will perform the duties set forth herein
above in a diligent and professional manner. The parties acknowledge and agree
that this Agreement does not contemplate any exclusive relationship between the
parties and that Consultant currently has consulting engagements with other
companies and that during the Term, Consultant will enter into additional
consulting engagements with other companies.

 

4.           Remuneration.

 

4.1         For entering into this Agreement to provide services after the
Commencement Date, and for other good and valuable consideration, the Company
agrees to pay to Consultant a “Commencement Bonus” in the form the form of
250,000 restricted shares of the Company's common stock (hereinafter the
"Restricted Shares"). The Restricted Shares shall be issued to Consultant within
15 days of the Commencement Date. The Company understands and agrees that
Consultant has foregone significant opportunities to enter into this Agreement
and that the Company derives substantial benefit from the execution of this
Agreement and the ability to announce its engagement of Consultant. Therefore,
the payment of the Commencement Bonus after the Commencement Date is a
non-refundable payment for future services. Consultant acknowledges that
Consultant will not be entitled to any remuneration unless and until there is a
Commencement Date.

 

4.2         The Company warrants that the Restricted Shares issuable to
Consultant under this Agreement by the Company shall be or have been validly
issued, fully paid and non-assessable and that the Company’s board of directors
has or shall have duly authorized the issuance and any transfer to Consultant.

 

4.3         The Company has the right to terminate this Agreement at any time
during the Term of this Agreement, upon providing Consultant thirty (30) days
written notice of Company’s intention to terminate. If the Company decides to
terminate this Agreement for any reason whatsoever, it is agreed and understood
that Consultant will not return any portion of the Restricted Shares issuable to
Consultant. Further, if and in the event the Company is acquired during the term
of this Agreement, it is agreed and understood that Consultant will not be
requested or demanded by the Company to return any of the Restricted Shares
payable to him hereunder.

 

4.4         Consultant agrees that during the Term he will not sell or transfer
any of the Restricted Shares issued to him by the Company hereunder, except to
the Company; nor will he pledge or assign such Shares as collateral or as
security for the performance of any obligation, or for any other purpose,
without the prior written consent of the Company.

 

 

 

  

4.5         Consultant acknowledges that the Restricted Shares to be issued
pursuant to this Agreement have not been registered under the Securities Act of
1933, as amended (the “Securities Act”) and accordingly are “restricted
securities” within the meaning of Rule 144 of the Act. As such, the Restricted
Shares may not be resold or transferred unless the Company has received an
opinion of counsel and in form reasonably satisfactory to the Company and its
counsel that such resale or transfer is exempt from the registration
requirements of that Securities Act. The Company agrees that in the event
Consultant wishes to effect a transfer in compliance with Rule 144, Consultant
will provide a Rule 144 opinion of counsel to the Company to Consultant within 5
business days of Consultant’s request of such opinion, provided that Consultant
provides such information and additional documentation as may reasonably be
requested by Company and its counsel to confirm that such transfer will be made
in compliance with Rule 144 and any applicable state securities laws. Company
agrees to bear all costs and expenses associated with any such Rule 144 legal
opinions and any related transfer agents’ fees. Consultant shall otherwise be
responsible for all other costs, expenses and compliance requirements under
federal and state securities laws, including any other opinions of counsel
reasonably required by the Company or its transfer agent.

 

4.6         In connection with the acquisition of the Restricted Shares,
Consultant represents and warrants to Company as follows:

 

(a)         Consultant has been afforded the opportunity to ask questions of and
receive answers from duly authorized officers or other representatives of the
Company concerning an investment in the Restricted Shares, and any additional
information that Consultant has requested.

 

(b)         Consultant has had an opportunity to review or has had access to the
EDGAR Website of the Securities and Exchange Commission (the “Commission”) to
the Company filings made with the Commission available at the EDGAR website.

 

(c)         Consultant’s investment in restricted securities is reasonable in
relation to Consultant’s net worth, which is in excess of ten (10) times
Consultant’s cost basis in the Restricted Shares. Consultant has experience in
investments in restricted and publicly traded securities, and Consultant has
experience in investments in speculative securities and other investments that
involve the risk of loss of investment. Consultant acknowledges that an
investment in the Restricted Shares is speculative and involves the risk of
loss. Consultant has the requisite knowledge to assess the relative merits and
risks of this investment without the necessity of relying upon other advisors,
and Consultant can afford the risk of loss of his entire investment in the
Restricted Shares. Consultant is an accredited investor, as that term is defined
in Regulation D promulgated under the Securities Act, and has provided a form of
questionnaire regarding such status annexed hereto as Exhibit A.

 

(d)         Consultant is acquiring the Restricted Shares for Consultant’s own
account for long-term investment and not with a view toward resale or
distribution thereof except in accordance with applicable securities laws.

 

(e)         Consultant is not subject to any of the "Bad Actor"
disqualifications described in Rule 506(d)(1)(i) to (viii) under the Securities
Act (a "Disqualification Event").

 

 

 

  

5.           Non-Assignability of Services. Consultant’s services under this
Agreement are offered to Company only and may not be assigned by Company except
to any entity with which Company merges with or which acquires the Company or
substantially all of its assets. In the event of such merger or acquisition, all
compensation to Consultant herein under the schedules set forth herein shall
remain due and payable. Consultant shall not assign his rights or delegate his
duties hereunder without the prior written consent of Company.

 

6.           Independent Contractor. Consultant is an independent contractor and
is not an employee, partner, or co-venturer of, or in any other service
relationship with the Company. The manner in which Consultant’s services are
rendered shall be within Consultant’s sole control and discretion. Consultant is
not authorized to speak for, represent, or obligate the Company in any manner
without the prior express written authorization from an officer of the Company.
Consultant shall be responsible for all taxes arising from compensation and
other amounts paid under this Agreement. Neither federal, nor state, nor local
income tax, nor payroll tax of any kind, shall be withheld or paid by the
Company on behalf of Consultant. Consultant understands that he is responsible
to pay, according to law, Consultant’s taxes and Consultant shall, when
requested by the Company, properly document to the Company that any and all
federal and state taxes have been paid. Consultant will not be eligible for and
shall not participate in any employee pension, health, welfare, or other fringe
benefit plan, of the Company. No workers' compensation insurance shall be
obtained by Company covering Consultant.

 

7.           Expenses. Consultant will be reimbursed for extraordinary expenses
he incurs (like travel required by/or specifically requested by the Company), as
long as such expenses have been approved by the Company in writing prior to its
incurring an obligation for reimbursement.

 

8.           Indemnification. The Company warrants and represents that all oral
communications, written documents or materials furnished to Consultant or the
public by the Company with respect to its products and services are accurate in
all material respects and Consultant may rely upon the accuracy thereof without
independent investigation. The Company will protect, indemnify and hold harmless
Consultant against any claims or litigation including any damages, liability,
cost and reasonable attorney's fees as incurred with respect thereto resulting
from Consultant's communication or dissemination of any said information,
documents or materials unless resulting from Consultant's communication or
dissemination of information not provided by the Company or in a manner not
authorized by the Company. Consultant will indemnify and hold Company harmless
against any claims or litigation, including any damages, liability, cost and
reasonable attorney’s fees as incurred with respect thereto resulting from (i)
Consultant’s communication or dissemination of any false or inaccurate
information, unless resulting from Consultant's communication or dissemination
of information provided by the Company or in a manner authorized by the Company,
and (ii) any breach of Consultant’s representations, warrants and covenants
under this Agreement. Notwithstanding anything to the contrary set forth in this
Agreement, the Company shall not be obligated to indemnify Consultant for any
such losses, claims, damages, liabilities or expenses incurred by Consultant
which have resulted solely from Consultant’s bad faith, gross negligence or
willful misconduct.

 

 

 

  

9.           Representations. Consultant represents that he is not required to
maintain any licenses and registrations under federal or any state regulations
necessary to perform the services set forth herein. Consultant acknowledges
that, to the best of his knowledge, the performance of the services set forth
under this Agreement will not violate any rule or provision of any regulatory
agency having jurisdiction over Consultant.

 

10.         Legal Representation. Each of Company and Consultant represents that
they have consulted with independent legal counsel and/or tax, financial and
business advisors, to the extent that they deemed necessary.

 

11.         Attorney's Fee. If any legal action or any arbitration or other
proceeding is brought for the enforcement or interpretation of this Agreement,
or because of an alleged dispute, breach, default or misrepresentation in
connection with or related to this Agreement, the successful or prevailing party
shall be entitled to recover reasonable attorneys' fees and other costs in
connection with that action or proceeding, in addition to any other relief to
which it or they may be entitled.

 

12.         Waiver. The waiver by either party of a breach of any provision of
this Agreement by the other party shall not operate or be construed as a waiver
of any subsequent breach by such other party.

 

13.         Notices. All notices, demands, requests, consents, approvals, and
other communications required or permitted hereunder shall be in writing and,
unless otherwise specified herein, shall be (i) personally served, (ii)
deposited in the mail, registered or certified, return receipt requested,
postage prepaid, (iii) delivered by reputable air courier service with charges
prepaid, or (iv) transmitted by hand delivery, telegram, or facsimile, addressed
as set forth below or to such other address as such party shall have specified
most recently by written notice. Any notice or other communication required or
permitted to be given hereunder shall be deemed effective (a) upon hand delivery
or delivery by facsimile, with accurate confirmation generated by the
transmitting facsimile machine, at the address or number designated below (if
delivered on a business day during normal business hours where such notice is to
be received), or the first business day following such delivery (if delivered
other than on a business day during normal business hours where such notice is
to be received) or (b) on the second business day following the date of mailing
by express courier service, fully prepaid, addressed to such address, or upon
actual receipt of such mailing, whichever shall first occur. The addresses for
such communications shall be:

 

To the Company:

Hojabr Alimi, CEO

Ruthigen, Inc.

2455 Bennett Valley Rd.; #C116

Santa Rosa, CA 95404

halimi@ruthigen.com

 

To Consultant:

Robert B. Prag, President

The Del Mar Consulting Group, Inc.

2455 El Amigo Road

Del Mar, CA 92014

bprag@delmarconsulting.com

 

It is understood that either party may change the address to which notices for
it shall be addressed by providing notice of such change to the other party in
the manner set forth in this paragraph.

 

 

 

  

14.         Choice of Law and Severability.  This Agreement shall be interpreted
in accordance with the laws of the State of Delaware without giving effect to
provisions governing the choice of law.  If any provision of this Agreement
becomes or is deemed invalid, illegal or unenforceable in any applicable
jurisdiction by reason of the scope, extent or duration of its coverage, then
such provision shall be deemed amended to the minimum extent necessary to
conform to applicable law so as to be valid and enforceable or, if such
provision cannot be so amended without materially altering the intention of the
parties, then such provision shall be stricken and the remainder of this
Agreement shall continue in full force and effect.  If any provision of this
Agreement is rendered illegal by any present or future statute, law, ordinance
or regulation (collectively, the "Law") then that provision shall be curtailed
or limited only to the minimum extent necessary to bring the provision into
compliance with the Law.  All the other terms and provisions of this Agreement
shall continue in full force and effect without impairment or limitation.

 

15.         Survival. Any provision of this Agreement which imposes an
obligation after termination or expiration of this Agreement shall survive the
termination or expiration of this Agreement.

 

16.         Complete Agreement. This Agreement contains the entire agreement of
the parties relating to the subject matter hereof. This Agreement and its terms
may not be changed orally but only by an agreement in writing signed by the
party against whom enforcement of any waiver, change, modification, extension or
discharge is sought. This Agreement may be executed in one or more counterparts,
each of which shall be deemed to be an original and all of which shall
constitute one agreement. A telefacsimile or email of this Agreement may be
relied upon as full and sufficient evidence as an original.

 

IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and
year first above written.

 

AGREED TO:

 

Company:  Ruthigen, Inc.     By:   Name: Hojabr Alimi Title: CEO and its Duly
Authorized Agent     Consultant:         Robert B. Prag

 

 

 

 

EXHIBIT A

 

ACCREDITED INVESTOR QUESTIONNAIRE

 

INSTRUCTIONS

 

PLEASE ANSWER ALL QUESTIONS. If the appropriate answer is “None” or “Not
Applicable”, so state. Please print or type your answers to all questions.
Attach additional sheets if necessary to complete your answers to any item.

 

Your answers will be kept strictly confidential at all times. However, the
Company may present this Questionnaire to such parties as it deems appropriate
in order to assure itself that the offer and sale of securities of the Company
will not result in a violation of the registration provisions of the Securities
Act of 1933, as amended, or a violation of the securities laws of any state.

 

1.         Please provide the following information:

 

Name:  

 

Name of additional purchaser:  

(Please complete information in Question 5)

 

Date of birth, or if other than an individual, year of organization or
incorporation:

 

     

 

2.         Residence address, or if other than an individual, principal office
address:

 

         

 

Telephone number:  

 

Social Security Number:  

 

Taxpayer Identification Number:  

 

3.  Business address:  

 

     

 

Business telephone number:  

 

4.  Send mail to: Residence ☐ Business ☐

 

 

 

 

5.         With respect to tenants in common, joint tenants and tenants by the
entirety, complete only if information differs from that above:

 

Residence address:  

 

     

 

Telephone number:  

 

Social Security Number:  

 

Taxpayer Identification Number:  

 

Business address:  

 

     

 

Business telephone number:  

 

Send Mail to: Residence ☐ Business ☐

 

6.         Please describe your present or most recent business or occupation
and indicate such information as the nature of your employment, how long you
have been employed there, the principal business of your employer, the principal
activities under your management or supervision and the scope (e.g. dollar
volume, industry rank, etc.) of such activities:

 

         

 

7.         Please state whether you (i) are associated with or affiliated with a
member of the Financial Industry Regulatory Association, Inc. (“FINRA”), (ii)
are an owner of stock or other securities of FINRA member (other than stock or
other securities purchased on the open market), or (iii) have made a
subordinated loan to any FINRA member: 

    Yes ☐ No ☐

 

 

 

 

If you answered yes to any of (i) – (iii) above, please indicate the applicable
answer and briefly describe the facts below:

 

         

 

8A.         Applicable to Individuals ONLY. Please answer the following
questions concerning your financial condition as an “accredited investor”
(within the meaning of Rule 501 of Regulation D). If the purchaser is more than
one individual, each individual must initial an answer where the question
indicates a “yes” or “no” response and must answer any other question fully,
indicating to which individual such answer applies. If the purchaser is
purchasing jointly with his or her spouse, one answer may be indicated for the
couple as a whole:

 

8.1         Does your net worth* (or joint net worth with your spouse) exceed
$1,000,000? 

    Yes ☐ No ☐

 

8.2         Did you have an individual income** in excess of $200,000 or joint
income together with your spouse in excess of $300,000 in each of the two most
recent years and do you reasonably expect to reach the same income level in the
current year? 

    Yes No ☐

 

8.3         Are you an executive officer of the Company? 

    Yes ☐ No ☐

 

* For purposes hereof, net worth shall be deemed to include ALL of your assets,
liquid or illiquid MINUS any liabilities.

 

** For purposes hereof, the term “income” is not limited to “adjusted gross
income” as that term is defined for federal income tax purposes, but rather
includes certain items of income which are deducted in computing “adjusted gross
income”. For investors who are salaried employees, the gross salary of such
investor, minus any significant expenses personally incurred by such investor in
connection with earning the salary, plus any income from any other source
including unearned income, is a fair measure of “income” for purposes hereof.
For investors who are self-employed, “income” is generally construed to mean
total revenues received during the calendar year minus significant expenses
incurred in connection with earning such revenues.

 

8.B        Applicable to Corporations, Partnerships, Trusts, Limited Liability
Companies and other Entities ONLY:

 

The purchaser is an accredited investor because the purchaser falls within at
least one of the following categories (Check all appropriate lines):

 

☐(i) a bank as defined in Section 3(a)(2) of the Act or a savings and loan
association or other institution as defined in Section 3(a)(5)(A) of the Act
whether acting in its individual or fiduciary capacity;

 

 

 

 

☐(ii) a broker-dealer registered pursuant to Section 15 of the Securities
Exchange Act of 1934, as amended;

 

☐(iii) an insurance company as defined in Section 2(13) of the Act;

 

☐(iv) an investment company registered under the Investment Company Act of 1940,
as amended (the “Investment Act”) or a business development company as defined
in Section 2(a)(48) of the Investment Act;

 

☐(v) 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, as amended;

 

☐(vi) 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, where such plan has total assets in excess of
$5,000,000;

 

☐(vii) an employee benefit plan within the meaning of Title 1 of the Employee
Retirement Income Security Act of 1974, as amended (the “Employee Act”), where
the investment decision is made by a plan fiduciary, as defined in Section 3(21)
of the Employee Act, which is either a bank, savings and loan association,
insurance company, or registered investment adviser, or an employee benefit plan
that has total assets in excess of $5,000,000, or a self-directed plan the
investment decisions of which are made solely by persons that are accredited
investors;

 

☐(viii) a private business development company, as defined in Section 202(a)(22)
of the Investment Advisers Act of 1940, as amended;

 

☐(ix) an organization described in Section 501(c)(3) of the Internal Revenue
Code, a corporation, a Massachusetts or similar business trust, or a
partnership, not formed for the specific purpose of acquiring the securities
offered, with total assets in excess of $5,000,000;

 

☐(x) 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 “sophisticated” person, as described in Rule 506(b)(2)(ii) promulgated
under the Act, who has such knowledge and experience in financial and business
matters that he or she is capable of evaluating the merits and risks of the
prospective investment;

 

☐(xi) an entity in which all of the equity investors are persons or entities
described above (“accredited investors”). ALL EQUITY OWNERS MUST COMPLETE
“EXHIBIT A” ATTACHED HERETO.

 

9.A        Do you have sufficient knowledge and experience in financial and
business matters so as to be capable of evaluating the merits and risks
associated with investing in the Company?  

    Yes ☐ No ☐

 

 

 

 

ANSWER QUESTION 9B ONLY IF THE ANSWER TO QUESTION 9A WAS “NO.”

 

9.B         If the answer to Question 9A was “NO,” do you have a financial or
investment adviser (a) that is acting in the capacity as a purchaser
representative and (b) who has sufficient knowledge and experience in financial
and business matters so as to be capable of evaluating the merits and risks
associated with investing in the Company? 

    Yes ☐ No ☐

 

If you have a financial or investment adviser(s), please identify each such
person and indicate his or her business address and telephone number in the
space below. (Each such person must complete, and you must review and
acknowledge, a separate Purchaser Representative Questionnaire which will be
supplied at your request).

 

     

 

10.         You have the right, will be afforded an opportunity, and are
encouraged to investigate the Company and review relevant factors and documents
pertaining to the officers of the Company, and the Company and its business and
to ask questions of a qualified representative of the Company regarding this
investment and the properties, operations, and methods of doing business of the
Company.

 

Have you or has your purchaser representative, if any, conducted any such
investigation, sought such documents or asked questions of a qualified
representative of the Company regarding this investment and the properties,
operations, and methods of doing business of the Company? 

    Yes ☐ No ☐

 

If so, briefly describe:  

 

   

 

If so, have you completed your investigation and/or received satisfactory
answers to your questions? 

    Yes ☐ No ☐

 

11.         Do you understand the nature of an investment in the Company and the
risks associated with such an investment? 

    Yes ☐ No ☐

 

 

 

 

12.         Do you understand that there is no guarantee of any financial return
on this investment and that you will be exposed to the risk of losing your
entire investment? 

    Yes ☐ No ☐

 

13.         Do you understand that this investment is not liquid? 

    Yes ☐ No ☐

 

14.         Do you have adequate means of providing for your current needs and
personal contingencies in view of the fact that this is not a liquid
investment? 

    Yes ☐ No ☐

 

15.         Are you aware of the Company’s business affairs and financial
condition, and have you acquired all such information about the Company as you
deem necessary and appropriate to enable you to reach an informed and
knowledgeable decision to acquire the Interests? 

    Yes ☐ No ☐

 

16.         Do you have a “pre-existing relationship” with the Company or any of
the officers of the Company? 

    Yes ☐ No ☐

 

(For purposes hereof, “pre-existing relationship” means any relationship
consisting of personal or business contacts of a nature and duration such as
would enable a reasonably prudent investor to be aware of the character,
business acumen, and general business and financial circumstances of the person
with whom such relationship exists.)

 

If so, please name the individual or other person with whom you have a
pre-existing relationship and describe the relationship:

 

     

 

17.         Exceptions to the representations and warranties made in Section 3.2
of the Securities Purchase Agreement (if no exceptions, write “none” – if left
blank, the response will be deemed to be “none”):
___________________________________________________

 

 

 

Dated: _______________, 20___

 

 

 

 

If purchaser is one or more individuals (all individuals must sign):

 

  (Type or print name of prospective purchaser)     Signature of prospective
purchaser     Social Security Number     (Type or print name of additional
purchaser)     Signature of spouse, joint tenant, tenant in common or other
signature, if required     Social Security Number

 

 

 

 

Annex A

 

Definition of Accredited Investor

 

The securities will only be sold to investors who represent in writing in the
Securities Purchase Agreement that they are accredited investors, as defined in
Regulation D, Rule 501 under the Act which definition is set forth below:

 

1.           A natural person whose net worth, or joint net worth with spouse,
at the time of purchase exceeds $1 million (excluding home); or

 

2.           A natural person whose individual gross income exceeded $200,000 or
whose joint income with that person’s spouse exceeded $300,000 in each of the
last two years, and who reasonably expects to exceed such income level in the
current year; or

 

3.           A trust with total assets in excess of $5 million, not formed for
the specific purpose of acquiring the securities offered, whose purchase is
directed by a sophisticated person described in Regulation D; or

 

4.           A director or executive officer of the Company; or

 

5.           The investor is an entity, all of the owners of which are
accredited investors; or

 

6.           (a) bank as defined in Section 3(a)(2) of the Act, or any savings
and loan association or other institution as defined in Section 3(a)(5)(A) of
the Act, (b) any broker or dealer registered pursuant to Section 15 of the
Securities Exchange Act of 1934, (c) an insurance Company as defined in Section
2(13) of the Act, (d) an investment Company registered under the Investment
Company Act of 1940 or a business development Company as defined in Section
2(a)(48) of such Act, (e) a Small Business Investment Company licensed by the
United States Small Business Administration under Section 301(c) or (d) of the
Small Business Investment Act of 1958, (f) an employee benefit plan established
and maintained by a state, its political subdivisions, or any agency or
instrumentality of a state or its political subdivisions, if such plan has total
assets in excess of $5 million, (g) an employee benefit plan within the meaning
of Title I of the Employee Retirement Income Securities Act of 1974, and the
employee benefit plan has assets in excess of $5 million, or the investment
decision is made by a plan fiduciary, as defined in Section 3(21) of such act,
that is either a bank, savings and loan institution, insurance Company, or
registered investment advisor, or, if a self-directed plan, with an investment
decisions made solely by persons that are accredited investors, (h) a private
business development company as defined in Section 202(a)(22) of the Investment
Advisers Act of 1940, or (i) 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 assets in excess of $5 million.

 

 

 

 

EXHIBIT “A” TO ACCREDITED INVESTOR QUESTIONNAIRE

 

ACCREDITED CORPORATIONS, PARTNERSHIPS, LIMITED LIABILITY COMPANIES, TRUSTS OR
OTHER ENTITIES INITIALING QUESTION 8B(xi) MUST PROVIDE THE FOLLOWING
INFORMATION.

 

I hereby certify that set forth below is a complete list of all equity owners in
__________________ [NAME OF ENTITY], a
                                               [TYPE OF ENTITY] formed pursuant
to the laws of the State of                                     . I also certify
that EACH SUCH OWNER HAS INITIALED THE SPACE OPPOSITE HIS OR HER NAME and that
each such owner understands that by initialing that space he or she is
representing that he or she is an accredited individual investor satisfying the
test for accredited individual investors indicated under “Type of Accredited
Investor.”

 

  signature of authorized corporate officer, general partner or trustee

 

Name of Equity Owner   Type of Accredited Investor1

 

1.       2.       3.       4.       5.       6.       7.       8.       9.      
10.  

 

 

1 Indicate which Subparagraph of 8.1 - 8.3 the equity owner satisfies.