Exhibit 10.1

 
 
SUBSCRIPTION AGREEMENT
 

Pubco (to be identified prior to closing) AV Therapeutics, Inc.
20 East 68th St., Suite 204
New York, NY 10065
 

Ladies and Gentlemen:
 

1.         Subscription.  The undersigned (the “Purchaser”), intending to be
legally bound, hereby irrevocably agrees to purchase from Pubco1, a Delaware
corporation (the “Company”) the number of shares of Pubco’s common stock (the
“Shares”) set forth on the signature page hereof at a purchase price of $0.20
per Share.  The Shares are being purchased in connection with a reverse
acquisition transaction between AV Therapeutics, Inc. (“AVT”), the Company and
two wholly-owned subsidiaries of the Company.

2.         This subscription is submitted to you in accordance with and subject
to the terms and conditions described in this Subscription Agreement (the
“Agreement” or “Subscription Agreement”) and the Confidential Private Placement
Memorandum (“PPM”) of the Company and AVT dated September 30, 2013, as amended
or supplemented from time to time, including all attachments, schedules and
exhibits thereto (the “Memorandum”), relating to the offering (the “Offering”)
by the Company of  up  to  a  maximum  of 12,500,000 shares of common stock
($2,500,000) (“Maximum Offering Amount”).   The terms of the Offering are more
completely described in the Memorandum and such terms are incorporated herein in
their entirety.

3.         Payment.   The Purchaser encloses herewith a check payable to, or
will immediately make a wire transfer payment to, “Sichenzia Ross Friedman
Ference, Escrow Agent for AV Therapeutics, Inc.” in the full amount of the
purchase price of the Shares being subscribed for.  Wire transfer instructions
are set forth on page 12 hereof under the heading “To subscribe for Shares in
the private offering of Pubco/AV Therapeutics, Inc.”  Such funds will be held
for the Purchaser's benefit, and will be returned promptly, without interest or
offset if (i) this Subscription Agreement is not accepted by the Company and
AVT, (ii) the Acquisition (as defined in the PPM) is not consummated, or (ii)
the Offering is terminated pursuant to its terms by the Company prior to the
First Closing (as defined hereafter). Together with a check for, or wire
transfer of, the full purchase price, the Purchaser is delivering

 

 

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  The identity of Pubco will be circulated to potential investors prior to the
closing. In connection with the consummation of the proposed reverse acquisition
transaction, it is contemplated that Pubco will change its name to AV
Therapeutics, Inc. (or a substantially similar name to be determined by
management).

 
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a completed and executed Omnibus Signature Page to this Subscription Agreement
and the Registration Rights Agreement, in the form of Exhibit C to the
Memorandum (the “Registration Rights Agreement”).

4.         Deposit of Funds.  All payments made as provided in Section 3 hereof
shall be deposited with Sichenzia Ross Friedman Ference LLP (the “Escrow
Agent”), in a non-interest-bearing escrow account (the “Escrow Account”) until
the earliest to occur of (a) the closing of the first sale of the Shares after
the Acquisition (the “First Closing”), (b) the rejection of such subscription,
and (c) the termination of the Offering by the Company, or AVT.  The Company may
continue to offer and sell the Shares and conduct
additional  closings  for  the  sale  of  additional  Shares  after  the  First  Closing  and  until  the
termination of the Offering.

5.         Acceptance of Subscription and Delivery of Shares.  The Purchaser
understands and agrees that the Company and AVT, in their sole discretion,
reserves the right to accept or reject this or any other subscription for
Shares, in whole or in part, notwithstanding prior receipt by the Purchaser of
notice of acceptance of this subscription. The Company shall have no obligation
hereunder until the Company shall execute and deliver to the Purchaser an
executed copy of this Subscription Agreement.  If this subscription is rejected
in whole, or the Offering of Shares is terminated for any reason, all funds
received from the Purchaser will be returned without interest or offset, and
this Subscription Agreement shall thereafter be of no further force or
effect.    If  this  subscription  is  rejected  in  part,  the  funds  for  the  rejected  portion  of  this
subscription will be returned without interest or offset, and this Subscription
Agreement will continue in full force and effect to the extent this subscription
was accepted. The Company shall deliver or cause to be delivered to the
Purchasers certificates for the Shares within ten business days of the
applicable Closing for such Shares, at the addresses set forth on the signature
page to this Agreement, or at such other address as the Purchasers may provide
in writing to the Company or AVT.

6.         Representations and Warranties.

The Purchaser hereby acknowledges, represents, warrants, and agrees as follows:

(a)       None of the Shares offered pursuant to the Memorandum are registered
under the Securities Act of 1933, as amended (the “Securities Act”), or any
state securities laws.  The Purchaser understands that the offering and sale of
the Shares is intended to be exempt from registration under the Securities Act,
by virtue of Section 4(a)(2) thereof and the provisions of Regulation D
(“Regulation D”) as promulgated by the United States Securities and Exchange
Commission (the “SEC”) thereunder, based, in part, upon the representations,
warranties and agreements of the Purchaser contained in this Subscription
Agreement;

(b)       Prior to the execution of this Subscription Agreement, the Purchaser
and the Purchaser's attorney, accountant, purchaser representative and/or tax
adviser, if any (collectively, the “Advisers”), have received the Memorandum and
all other documents requested by the Purchaser, have carefully reviewed them and
understand the information contained therein;

(c)       Neither  the  Securities  and  Exchange  Commission  nor  any  state  securities
commission or other regulatory authority has approved the Shares, or passed upon
or endorsed the merits of the offering of Shares or

 
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confirmed the accuracy or determined the adequacy of the Memorandum. The
Memorandum has not been reviewed by any federal, state or other regulatory
authority;

(d)       All documents, records, and books pertaining to the investment in the
Shares (including, without limitation, the Memorandum) have been made available
for inspection by such Purchaser and its Advisers, if any;

(e)       The Purchaser and its Advisers, if any, have had a reasonable
opportunity to ask questions of and receive answers from a person or persons
acting on behalf of the Company
concerning  the  Offering  of  the  Shares  and  the  business,  financial  condition  and  results  of
operations of the Company and AVT, and all such questions have been answered to
the full satisfaction of the Purchaser and its Advisers, if any;

(f)        In evaluating the suitability of an investment in the Company, the
Purchaser has not relied upon any representation or information (oral or
written) other than as stated in the Memorandum;

(g)       The Purchaser is unaware of, is in no way relying on, and did not
become aware of the Offering of the Shares through or as a result of, any form
of general solicitation or general advertising including, without limitation,
any article, notice, advertisement or other communication published in any
newspaper, magazine or similar media or broadcast over television, radio or the
Internet (including, without limitation, internet “blogs,” bulletin boards,
discussion groups and social networking sites) in connection with the Offering
and sale of the Shares and is not subscribing for the Shares and did not become
aware of the Offering of the Shares through or as a result of any seminar or
meeting to which the Purchaser was invited by, or any solicitation of a
subscription by, a person not previously known to the Purchaser in connection
with investments in securities generally;

(h)       The Purchaser has taken no action that would give rise to any claim by
any person for brokerage commissions, finders' fees or the like relating to this
Subscription Agreement or the transactions contemplated hereby;

(i)        The  Purchaser,  together  with  its  Advisers,  if  any,  has  such  knowledge  and
experience in financial, tax, and business matters, and, in particular,
investments in securities, so as to enable it to utilize the information made
available to it in connection with the Offering to evaluate the merits and risks
of an investment in the Shares and the Company and to make an informed
investment decision with respect thereto;

(j)        The Purchaser is not relying on the Company, AVT, or any of their
respective employees or agents with respect to the legal, tax, economic and
related considerations of an investment in the Shares, and the Purchaser has
relied on the advice of, or has consulted with, only its own Advisers;

(k)       The Purchaser is acquiring the Shares solely for such Purchaser's own
account for investment purposes only and not with a view to or intent of resale
or distribution thereof, in whole or in part.  The Purchaser has no agreement or
arrangement, formal or informal, with any

 
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person to sell or transfer all or any part of the Shares, and the Purchaser has
no plans to enter into any such agreement or arrangement.

(l)        The Purchaser must bear the substantial economic risks of the
investment in the Shares indefinitely because none of the Shares may be sold,
hypothecated or otherwise disposed of unless subsequently registered under the
Securities Act and applicable state securities laws or an exemption from such
registration is available. Legends shall be placed on the Shares to the effect
that they have not been registered under the Securities Act or applicable state
securities laws and appropriate notations thereof will be made in the Company's
stock books.   Appropriate notations will be made in the Company's stock books
to the effect that the Shares have not been registered under the Securities Act
or applicable state securities laws.  Stop transfer instructions will be placed
with the transfer agent of the Shares.  The Company has agreed that purchasers
of the Shares will have, with respect to the Shares, the registration rights
described in the Registration Rights Agreement.  Notwithstanding such
registration rights, there can be no assurance that there will be any market for
resale of the Shares, nor can there be any assurance that such securities will
be freely transferable at any time in the foreseeable future.

(m)      The Purchaser has adequate means of providing for such Purchaser's
current financial needs and foreseeable contingencies and has no need for
liquidity of its investment in the Shares for an indefinite period of time;

(n)       The Purchaser is aware that an investment in the Shares is high risk,
involving a number of very significant risks and has carefully read and
considered the matters set forth under the caption “Risk Factors” in the
Memorandum, and, in particular, acknowledges its understanding that AVT has a
limited operating history, significant operating losses since inception, no
revenues to date, limited assets and is engaged in a highly competitive
business;
 
(o)       The Purchaser meets the requirements of at least one of the
suitability standards for an “accredited investor” as that term is defined in
Regulation D and as set forth on the Accredited Investor Certification contained
herein;

(p)       The Purchaser (i) if a natural person, represents that the Purchaser
has reached the age of 21 and has full power and authority to execute and
deliver this Subscription Agreement and all other related agreements or
certificates and to carry out the provisions hereof and thereof; (ii) if a
corporation, partnership, or limited liability company or partnership, or
association, joint stock company, trust, unincorporated organization or other
entity, represents that such entity was not formed for the specific purpose of
acquiring the Shares, such entity is duly organized, validly existing and in
good standing under the laws of the state of its organization, the consummation
of the transactions contemplated hereby is authorized by, and will not result in
a violation of state law or its charter or other organizational documents, such
entity has full power and authority to execute and deliver this Subscription
Agreement and all other related agreements or certificates and to carry out the
provisions hereof and thereof and to purchase and hold the securities
constituting the Shares, the execution and delivery of this Subscription
Agreement has been duly authorized by all necessary action, this Subscription
Agreement has been duly executed and

 
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delivered on behalf of such entity and is a legal, valid and binding obligation
of such entity; or (iii) if executing this Subscription Agreement in a
representative or fiduciary capacity, represents that it has full power and
authority to execute and deliver this Subscription Agreement in such capacity
and on behalf of the subscribing individual, ward, partnership, trust, estate,
corporation, or limited liability company or partnership, or other entity for
whom the Purchaser is executing this Subscription Agreement, and such
individual, partnership, ward, trust, estate, corporation, or limited liability
company or partnership, or other entity has full right and power to perform
pursuant to this Subscription Agreement and make an investment in the Company,
and represents that this Subscription Agreement constitutes a legal, valid and
binding obligation of such entity. The execution and delivery of this
Subscription Agreement will not violate or be in conflict with any order,
judgment, injunction, agreement or controlling document to which the Purchaser
is a party or by which it is bound;

(q)       The Purchaser and the Advisers, if any, have had the opportunity to
obtain any additional information, to the extent the Company and/or AVT have
such information in its possession or could acquire it without unreasonable
effort or expense, necessary to verify the accuracy of the information contained
in the Memorandum and all documents received or reviewed in connection with the
purchase of the Shares and have had the opportunity to have representatives of
the Company and AVT provide them with such additional information regarding the
terms and conditions of this particular investment and the financial condition,
results of operations, business of the Company and AVT deemed relevant by the
Purchaser or the Advisers, if any, and all such requested information, to the
extent the Company had such information in its possession or could acquire it
without unreasonable effort or expense, has been provided to the full
satisfaction of the Purchaser and the Advisers, if any;

(r)        Any information which the Purchaser has heretofore furnished or is
furnishing herewith to the Company, or AVT is complete and accurate and may be
relied upon by the Company, and AVT in determining the
availability  of  an  exemption  from  registration  under  federal  and  state  securities  laws  in
connection with the offering of securities as described in the Memorandum.   The
Purchaser further represents and warrants that it will notify and supply
corrective information to the Company and AVT immediately upon the occurrence of
any change therein occurring prior to the Company's issuance of the Shares;

(s)       The Purchaser has significant prior investment experience, including
investment in non-listed and non-registered securities.  The Purchaser is
knowledgeable about investment considerations in companies with limited
operating histories.  The Purchaser has a sufficient net worth to sustain a loss
of its entire investment in the Company in the event such a loss should
occur.   The Purchaser's overall commitment to investments which are not readily
marketable is not excessive in view of the Purchaser’s net worth and financial
circumstances and the purchase of the Shares will not cause such commitment to
become excessive. The investment is a suitable one for the Purchaser;

(t)        The Purchaser is satisfied that the Purchaser has received adequate
information with respect to all matters which it or the Advisers, if any,
consider material to its decision to make this investment;

 
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(u)       The Purchaser acknowledges that any estimates or forward-looking
statements or projections included in the Memorandum were prepared by AVT in
good faith but that the
attainment  of  any  such  projections,  estimates  or  forward-looking  statements  cannot  be
guaranteed by the Company or AVT and should not be relied upon;

(v)       No oral or written representations have been made, or oral or written
information furnished, to the Purchaser or the Advisers, if any, in connection
with the Offering which are in any way inconsistent with the information
contained in the Memorandum;

(w)      Within five (5) days after receipt of a request from the Company or
AVT, the Purchaser will provide such information and deliver such documents as
may reasonably be necessary to comply with any and all laws and ordinances to
which the Company or AVT is subject;

(x)       THE SECURITIES OFFERED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS AND ARE BEING
OFFERED AND SOLD IN RELIANCE ON EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF
SAID ACT AND SUCH LAWS.   THE SECURITIES ARE SUBJECT TO RESTRICTIONS ON
TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS
PERMITTED UNDER SAID ACT AND SUCH LAWS PURSUANT TO REGISTRATION OR EXEMPTION
THEREFROM.  THE SECURITIES HAVE NOT BEEN RECOMMENDED, 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 THE
MEMORANDUM OR THIS SUBSCRIPTION AGREEMENT. ANY REPRESENTATION TO THE CONTRARY IS
UNLAWFUL;

 
(y)       In making an investment decision investors must rely on their own
examination of the Company, AVT and the terms of the Offering, including the
merits and risks involved. The Purchaser should  be  aware that it  will
be  required to  bear the  financial risks  of  this investment for an
indefinite period of time;

(z)       (For ERISA  plans  only)        The  fiduciary of  the  ERISA plan
(the  “Plan”) represents that such fiduciary has been informed of and
understands the Company’s investment objectives, policies and strategies, and
that the decision to invest “plan assets” (as such term is defined in ERISA) in
the Company is consistent with the provisions of ERISA that require
diversification  of  plan  assets  and  impose  other  fiduciary  responsibilities.    The  Purchaser
fiduciary or Plan (a) is responsible for the decision to invest in the Company;
(b) is independent of the Company or any of its affiliates; (c) is qualified to
make such investment decision; and (d) in making such decision, the Purchaser
fiduciary or Plan has not relied primarily on any advice or recommendation of
the Company or any of its affiliates;

 
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(aa)     The Purchaser
should check the Office of Foreign Assets Control (“OFAC”)
website at <http://www.treas.gov/ofac> before making the following representations.
The Purchaser represents that the amounts invested by it in the Company in the
Offering were not and are not directly or indirectly derived from activities
that contravene federal, state or international laws and regulations, including
anti-money laundering laws and regulations. Federal regulations and Executive
Orders administered by OFAC prohibit, among other things, the engagement in
transactions with, and the provision of services to, certain foreign countries,
territories, entities and individuals.  The lists of OFAC prohibited countries,
territories, persons and entities can be
found  on  the  OFAC  website  at  <http://www.treas.gov/ofac>.    In  addition,  the  programs
administered by OFAC (the “OFAC Programs”) prohibit dealing with individuals2 or
entities in certain countries regardless of whether such individuals or entities
appear on the OFAC lists;

(bb)     To the best of the Purchaser’s knowledge, none of: (1) the Purchaser;
(2) any person controlling or controlled by the Purchaser; (3) if the Purchaser
is a privately-held entity, any person  having a  beneficial interest in  the
Purchaser; or  (4)  any person  for  whom  the Purchaser is acting as agent or
nominee in connection with this investment is a country, territory, individual
or entity named on an OFAC list, or a person or entity prohibited under the OFAC
Programs.   The Purchaser acknowledges that the Company may not accept any
amounts from a prospective investor if such prospective investor cannot make the
representation set forth in the preceding paragraph.   The Purchaser agrees to
promptly notify the Company and AVT should the Purchaser become aware of any
change in the information set forth in these representations;

(cc)     To the best of the Purchaser’s knowledge, none of: (1) the Purchaser;
(2) any person controlling or controlled by the Purchaser; (3) if the Purchaser
is a privately-held entity, any person  having a  beneficial interest in  the
Purchaser; or  (4)  any person  for  whom  the Purchaser is acting as agent or
nominee in connection with this investment is a senior foreign political
figure,3 or any immediate family4 member or close associate5 of a senior foreign
political figure, as such terms are defined in the footnotes below; and

 

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2
These individuals include specially designated nationals, specially designated
narcotics traffickers and other parties subject to OFAC sanctions
and embargo programs.

 
3
A “senior foreign political figure” is defined as a senior official in the
executive, legislative, administrative, military or judicial branches of a
foreign government (whether elected or not), a senior official of a major
foreign political party, or a senior executive of a foreign government- owned
corporation. In addition, a “senior foreign political figure” includes any
corporation, business or other entity that has been formed by, or for the
benefit of, a senior foreign political figure.
 
 
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(dd)     If the Purchaser is affiliated with a non-U.S. banking institution (a
“Foreign Bank”), or if the Purchaser receives deposits from, makes payments on
behalf of, or handles other financial transactions related to a Foreign Bank,
the Purchaser represents and warrants to the Company that: (1) the Foreign Bank
has a fixed address, other than solely an electronic address, in a country in
which the Foreign Bank is authorized to conduct banking activities; (2) the
Foreign Bank maintains operating records related to its banking activities; (3)
the Foreign Bank is subject to inspection by the banking authority that licensed
the Foreign Bank to conduct banking activities; and (4) the Foreign Bank does
not provide banking services to any other Foreign Bank that does not have a
physical presence in any country and that is not a regulated affiliate.

 
7.         Anti-Dilution Adjustment for Common Stock. For a period commencing on
the First Closing and terminating on a date which is 18 months from the First
Closing (the “Adjustment Period”), in the event the Company issues or grants any
shares of common stock or securities convertible, exchangeable or exercisable
for shares of common stock (“Common Stock Equivalents”) pursuant to which shares
of common stock may be acquired at a price less than $0.20 per share (an
“Adjustment Event”), then the Company shall promptly issue additional shares of
common stock to the Purchasers in an amount sufficient that the subscription
price paid hereunder, when divided by the total number of shares issued will
result in an actual price paid by the Purchaser per share of common stock equal
to such lower price (for purposes of explanation this Section is intended to
provide for a “full ratchet” adjustment). Such adjustments shall be made
successively whenever such an issuance is made during the Adjustment Period and
shall only be applicable to the Shares of common stock originally purchased
hereunder, and which continue to be held, by the Purchasers as of the date of
the Adjustment Event.  This Section shall not apply to an “Exempt Issuance”. The
Company shall issue any additional shares of common stock to the Purchasers
required to be issued pursuant to this Section within 15 business days of the
date of the Adjustment Event.  “Exempt Issuance” means the issuance or sale of
Common Stock or Common Stock Equivalents for or in connection with (i) full or
partial consideration in connection with a bona fide strategic merger.
acquisition, consolidation or purchase of substantially all of the securities or
assets of a corporation or other entity by the Company or any subsidiary of the
Company so long as such issuances are not for the purpose of raising capital,
(ii) bona fide strategic license agreements and other bona fide partnering
arrangements so long as such issuances are not for the purpose of raising
capital, (iii) the Company’s issuance of common stock or Common Stock
Equivalents  to employees, directors, and consultants  approved by majority of
the non-employee members of the Board of Directors of the Company or a majority
of the members of a committee of non-employee directors established for such
purpose, (iv) the exercise or exchange of or conversion of securities
exercisable or exchangeable for or convertible into shares of common stock
issued and outstanding as of the date of this Agreement, or pursuant to
agreements in effect as of the date of this Agreement (including, without
limitation, securities issuable pursuant to this Agreement or the Memorandum),
(v) securities issued or issuable pursuant to agreements and/ or securities
issued or issuable in connection with the Acquisition and (vi) issuances of
securities in connection with a public offering which is underwritten on a firm
commitment basis.

8.         Indemnification.  The Purchaser agrees to indemnify and hold harmless
the Company, AVT, and their respective officers, directors, employees, agents,
control persons and affiliates from and against all losses, liabilities, claims,
damages, costs, fees and expenses whatsoever (including, but not limited to, any
and all expenses incurred in investigating, preparing or
 
 
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defending against any litigation commenced or threatened) based upon or arising
out of any actual or alleged false acknowledgment, representation or warranty,
or misrepresentation or omission to state a material fact, or breach by the
Purchaser of any covenant or agreement made by the Purchaser herein or in any
other document delivered in connection with this Subscription Agreement.

9.         Irrevocability; Binding Effect.  The Purchaser hereby acknowledges
and agrees that the subscription hereunder is irrevocable by the Purchaser,
except as required by applicable law, and that this Subscription Agreement shall
survive the death or disability of the Purchaser and shall be binding upon and
inure to the benefit of the parties and their heirs, executors, administrators,
successors, legal representatives, and permitted assigns.   If the Purchaser is
more than one person, the obligations of the Purchaser hereunder shall be joint
and several and the agreements, representations, warranties, and acknowledgments
herein shall be deemed to be made by and be binding upon each such person and
such person's heirs, executors, administrators, successors, legal
representatives, and permitted assigns.

10.       Modification.  All modifications, amendments or waivers to this
Agreement shall require the written consent of both the Company and the holders
of the majority of the Shares originally purchased who continue to hold such
Shares purchased pursuant to this Agreement at the time when any such
modifications, amendments or waivers is sought.
 
11.       Immaterial Modifications to the Registration Rights Agreement.  The
Company may, at any time prior to the First Closing, modify the Registration
Rights Agreement if necessary to clarify any provision therein, without first
providing notice or obtaining prior consent of the Purchaser, if, and only if,
such modification is not material in any respect.

 

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4
“Immediate family” of a senior foreign political figure typically includes the
figure’s parents, siblings, spouse, children and in-laws.

 
5
A “close associate” of a senior foreign political figure is a person who is
widely and publicly known to maintain an unusually close relationship with the
senior foreign political figure, and includes a person who is in a position to
conduct substantial domestic and international financial transactions on behalf
of the senior foreign political figure.

 
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12.       Notices. Any notice or other communication required or permitted to be
given hereunder shall be in writing and shall be mailed by certified mail,
return receipt requested, or delivered against receipt to the party to whom it
is to be given (a) if to the Company or AVT, at the address set forth above, or
(b) if to the Purchaser, at the address set forth on the signature page hereof
(or, in either case, to such other address as the party shall have furnished in
writing in accordance with the provisions of this Section).  Any notice or other
communication given by certified mail shall be deemed given at the time of
certification thereof, except for a notice changing a party's address which
shall be deemed given at the time of receipt thereof.

13.       Assignability.  This Subscription Agreement and the rights, interests
and obligations hereunder are not transferable or assignable by the Purchaser
and the transfer or assignment of Shares shall be made only in accordance with
all applicable laws.

14.       Applicable Law, Disputes.  This Agreement shall be governed by and
construed in accordance with the laws of the State of New York without giving
effect to the conflict of law provisions thereof, and the parties hereto
irrevocably submit to the exclusive jurisdiction of the United States District
Court for the Southern District of New York, or, if jurisdiction in such court
is lacking, the Supreme Court of the State of New York, New York County, in
respect of any dispute or matter arising out of or connected with this
Agreement..

15.       Blue Sky Qualification.  The purchase of Shares under this
Subscription Agreement is expressly conditioned upon the exemption from
qualification of the offer and sale of the Shares from applicable federal and
state securities laws.  The Company shall not be required to qualify this
transaction under the securities laws of any jurisdiction and, should
qualification be necessary, the Company shall be released from any and all
obligations to maintain its offer, and may rescind any sale contracted, in the
jurisdiction.

16.       Use of Pronouns.  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 referred to may require.

17.       Confidentiality.  The Purchaser acknowledges and agrees that any
information or data the Purchaser has acquired from or about the Company or AVT,
not otherwise properly in the public domain, was received in confidence.   The
Purchaser agrees not to divulge, communicate or disclose, except as may be
required by law or for the performance of this Agreement, or use to the
detriment of the Company or AVT or for the benefit of any other person or
persons, or misuse in any way, any confidential information of the Company or
AVT, including any scientific, technical, trade or business secrets of the
Company or AVT and any scientific, technical, trade or business materials that
are treated by the Company or AVT as confidential or proprietary, including, but
not limited to, ideas,
discoveries,  inventions,  developments  and  improvements  belonging  to  the  Company  or
AVT and confidential information obtained by or given to the Company or AVT
about or belonging to third parties.

18.       Miscellaneous.

(a)       This Subscription Agreement, together with the Registration Rights
Agreement, constitute the entire agreement between the Purchaser and the Company
with respect to the subject matter hereof and supersede all prior oral or
written agreements and understandings, if any, relating to the subject matter
hereof.  The terms and provisions of this Subscription
 
 
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Agreement may be waived, or consent for the departure therefrom granted, only by
a written document executed by the party entitled to the benefits of such terms
or provisions.

(b)       The representations and warranties of the Company and the Purchaser
made in this Subscription Agreement shall survive the execution and delivery
hereof and delivery of the Shares.

(c)       Each of the parties hereto shall pay its own fees and expenses
(including the fees of any attorneys, accountants, appraisers or others engaged
by such party) in connection with this
Subscription  Agreement  and  the  transactions  contemplated  hereby  whether  or  not  the
transactions contemplated hereby are consummated.

(d)       This Subscription Agreement may be executed in one or more
counterparts each of which shall be deemed an original, but all of which shall
together constitute one and the same instrument.

(e)       Each provision of this Subscription Agreement shall be considered
separable and, if for any reason any provision or provisions hereof are
determined to be invalid or contrary to applicable law, such invalidity or
illegality shall not impair the operation of or affect the remaining portions of
this Subscription Agreement.

(f)        Paragraph titles are for descriptive purposes only and shall not
control or alter the meaning of this Subscription Agreement as set forth in the
text.

(g)       The Purchaser understands and acknowledges that there may be multiple
closings for this Offering.

(h)       Independent Nature of Subscribers.  The obligations of each Purchaser
under this Agreement or other transaction document are several and not joint
with the obligations of any other Purchaser, and no Purchaser shall be
responsible in any way for the performance of the obligations of any other
Purchaser under this Agreement or any other transaction document.  Each
Purchaser shall be responsible only for its own representations, warranties,
agreements and covenants hereunder.  The decision of each Purchaser to purchase
Shares pursuant to this Agreement has been made by such Purchaser independently
of any other Purchaser and independently of any information, materials,
statements or opinions as to the business, affairs, operations, assets,
properties, liabilities, results of operations, condition (financial or
otherwise) or prospects of the Company which may have been made or given by any
other Purchaser or by any agent or employee of any other Purchaser, and no
Purchaser or any of its agents or employees shall have any liability to any
other Purchaser (or any other person) relating to or arising from any such
information, materials, statements or opinions.  Nothing contained herein or in
any other transaction document, and no action taken by any Purchaser pursuant
hereto or thereto, shall be deemed to constitute the Purchaser as a partnership,
an association, a joint venture or any other kind of entity, or create a
presumption that the Purchaser are in any way acting in concert or as a group
with respect to such obligations or the transactions contemplated by this
Agreement.  Except as otherwise provided in this Agreement or any other
transaction document, each Purchaser shall be entitled to independently protect
and enforce its rights arising out of this Agreement or out of the other
transaction documents, and it shall not be necessary for any other Purchaser to
be joined as an additional party in any proceeding for such purpose.  Each
Subscriber has been represented by its own separate legal counsel in connection
with the transactions contemplated hereby.
 
 
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(i)              Further Assurances.  Each party hereto shall do and perform or
cause to be done and performed all such further acts and shall execute and
deliver all such other agreements, certificates, instruments and documents as
any other party hereto reasonably may request in order to carry out the intent
and accomplish the purposes of this Agreement and the consummation of the
transactions contemplated hereby.  
    
20.       Omnibus Signature Page.  This Subscription Agreement is intended to be
read and construed in conjunction with the Registration Rights Agreement
pertaining to the issuance by the Company of the Shares to subscribers pursuant
to the Memorandum.   Accordingly, pursuant to the terms and conditions of this
Subscription Agreement and such related agreements it is hereby agreed that the
execution by the Purchaser of this Subscription Agreement, in the place set
forth herein, shall constitute agreement to be bound by the terms and conditions
hereof and the terms and conditions of the Registration Rights Agreement,
with  the  same  effect  as  if  each  of  such  separate  but  related  agreement  were
separately signed.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 
 
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Instructions
 

 
To subscribe for Shares in the private offering of Pubco/AV Therapeutics, Inc.:
 

1.         Date and Fill in the number of Shares being purchased and
Complete and Sign the attached Omnibus Signature Page to the Subscription
Agreement and Registration Agreement.

2.         Initial the Accredited Investor Certification page attached hereto.
 
3.         Complete and Sign the Selling Stockholder Questionnaire.
 
4.         E-mail the Omnibus Signature Page, Accredited Investor Certification
page, Investor Profile and, if applicable, Wire Transfer Authorization, to
Darrin Ocasio at dmocasio@srff.com and then send all signed original documents
with check (if applicable) to:
 

Sichenzia Ross Friedman Ference LLP
61 Broadway, 32nd Fl.
New York, NY 10006
Attention: Darrin Ocasio

 
5.      Please make your subscription payment payable to the order of “Sichenzia
Ross Friedman Ference, Escrow Agent for AV Therapeutics, Inc.”

For wiring funds directly to the escrow account, see the following instructions:
 

Wire to:
 
All funds tendered by Purchasers will be held in a non-interest bearing escrow
account in the Company’s name at Sichenzia Ross Friedman Ference LLP, 61
Broadway, 32nd Fl., New York, New York 10006.  It is contemplated that the funds
will be released from escrow at such time (or promptly thereafter) as all
conditions to closing as set forth in the Subscription Agreement have been
satisfied (or otherwise waived) and a closing is consummated.
 
PUBCO/AV THERAPEUTICS, INC.
 OMNIBUS SIGNATURE PAGE TO THE SUBSCRIPTION AGREEMENT
AND REGISTRATION RIGHTS AGREEMENT

Subscriber hereby elects to subscribe under the Subscription Agreement for a
total of [________]    Shares at a price of $0.20 per Share for an aggregate
purchase price of $[_____] (NOTE: to be completed by subscriber) and executes
the Subscription Agreement and the Registration Rights Agreement.
 
 
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Date (NOTE: To be completed by subscriber): 
 

--------------------------------------------------------------------------------

 
If the Purchaser is an INDIVIDUAL, and if purchased as JOINT TENANTS, as TENANTS
IN COMMON, or as COMMUNITY PROPERTY:

                                                                                
                                                                                
Print Name(s)
Social Security Number(s)
       
                                                                              
                                                                                
Signature(s) of Subscriber(s)
Signature
       
                                                                              
                                                                                
Date
Address

 

If the Purchaser is a PARTNERSHIP, CORPORATION, LIMITED LIABILITY COMPANY or TRUST:

                                                                                
                                                                                
Name of Partnership,
Corporation, Limited
Liability Company or Trust
Federal Taxpayer
Identification Number
       
By:                                                                      
                                                                                
   Name:
State of Organization      Title:          
                                                                              
                                                                                
Date
Address

 

 
AV Therapeutics, Inc.
         
By:                                                                          
   Authorized Officer
         
                                                                              
(Name of Pubco to be inserted at closing)        
By:                                                                          
   Authorized Officer
 

 

 
 
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PUBCO/AV THERAPEUTICS, INC.
 
ACCREDITED INVESTOR CERTIFICATION
 
For Individual Investors Only
(all Individual Investors must INITIAL where appropriate):
 

 
Initial                 I have an individual net worth, or joint net worth with
my spouse, as of the date hereof
(excluding, for the purpose of net worth calculation,
the value of such person’s or persons’ primary residence,
after deducting any mortgage securing such primary residence) in excess of $1
million.
 
 
Initial                 I have had an annual gross income for the past two years
of at least $200,000 (or $300,000 jointly with my spouse) and expect my income
(or joint income, as appropriate) to reach the same level in the current year.
 
 
Initial                 I am a director or executive officer of Pubco.

 

 
For Non-Individual Investors
(all Non-Individual Investors must INITIAL where appropriate):

 
Initial                   The investor certifies that it is a partnership,
corporation, limited liability company or business trust that is 100% owned by
persons who meet at least one of the criteria for Individual Investors set forth
above.
 
 
Initial                   The investor certifies that it is a partnership,
corporation, limited liability company or any organization described in Section
501(c)(3) of the Internal Revenue Code, Massachusetts or similar business trust
that has total assets of at least $5 million and was not formed for the purpose
of investing the Company.
 
 
Initial                   The investor certifies that it is an employee benefit
plan within the meaning of the Employee Retirement Income Security Act of 1974,
whose investment decision is made by a plan fiduciary (as defined in ERISA
§3(21)) that is a
bank,   savings   and   loan   association,  insurance  company   or   registered
investment adviser.
 
 
Initial                   The investor certifies that it is an employee benefit
plan whose total assets exceed $5,000,000 as of the date of this Agreement.
 
 
Initial                 The undersigned certifies that it is a self-directed
employee benefit plan whose investment decisions are made solely by persons who
meet either of the criteria for Individual Investors.
 
 
 
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Initial                 The investor certifies that it is a U.S. bank, U.S.
savings and loan association or other similar U.S. institution acting in its
individual or fiduciary capacity.
 
 
Initial                 The undersigned certifies that it is a broker-dealer
registered pursuant to §15 of the Securities Exchange Act of 1934.
 
 
Initial                  The investor certifies that it is an organization
described in §501(c)(3) of the Internal Revenue Code with total assets exceeding
$5,000,000 and not formed for the specific purpose of investing in the Company.

 
Initial                  The investor certifies that it is a trust with total
assets of at least $5,000,000, not formed for the specific purpose of investing
in the Company, and whose purchase is directed by a person with such knowledge
and experience in financial and business matters that he is capable of
evaluating the merits and risks of the prospective investment.
 
 
Initial                 The investor certifies that it is a plan established and
maintained by a state or its political subdivisions, or any agency or
instrumentality thereof, for the benefit of its employees, and which has total
assets in excess of $5,000,000.

 
Initial                   The investor certifies that it is an insurance company
as defined in §2(13) of the Securities Act, or a registered investment company.
 
 
Initial                   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.

 
Initial                   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.

 
Initial                    A private business development company as defined in
Section 202(a)(22) of the Investment Advisers Act of 1940.
 
 
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Date
 
 
 
 
 
 

 
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