Exhibit 10.2

 

To subscribe for Units

in the private offering of

AETHLON MEDICAL, INC.

 

1.Date and Fill in the number of units (the “Units”) (each Unit consisting of
(a) one hundred thousand (100,000) shares of the Company’s common stock par
value $0.001 per share (the “Common Stock”) at a purchase price of $0.125 per
share, and (b) a five-year warrant (collectively, the “Warrants” and together
with the Units and Common Stock, the “Securities”) to purchase fifty thousand
(50,000) shares of Common Stock of the Company at an exercise price equal to
$0.22 per share, subject to equitable adjustment thereunder (the “Exercise
Price”) at a negotiated price of $12,500 per Unit being subscribed for and
Complete and Sign the Signature Page included in the Subscription Agreement.

 

2.Initial the Accredited Investor Certification attached to this Subscription
Agreement.

 

3.Complete and Sign the Signature Page attached to this Subscription Agreement.
NOTICE: Please note that by executing the attached Subscription Agreement, you
will deemed to have executed the Unit Purchase Agreement (Exhibit B to the
Memorandum, as defined below), and agreed to the terms of the Warrant (Exhibit C
to the Unit Purchase Agreement) and all exhibits, supplements and schedules
thereto, as such may be amended from time to time (collectively the “Transaction
Documents”), each of which are attached to the Memorandum, and will be treated
for all purposes as if you did review, approve and execute, if required, each
such Transaction Document even though you may not have physically signed the
signature pages to such documents.

 

4.Complete and Return the attached Purchaser Questionnaire and, if applicable,
Wire Transfer Authorization attached to this Subscription Agreement.

 

5.Return all forms to your Account Executive and then send all signed original
documents with a check (if applicable) to:

 

_________________

_________________

_________________

_________________

 

6.Please make your subscription payment payable to the order of
“_________________, as Escrow Agent for Aethlon Medical, Inc.” Account No.
_________________

 

 

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

 

_________________

_________________

_________________

Acct. Name:

 

 

ABA Number:

SWIFT Code:

A/C Number:

 

FBO: Purchaser Name

           Social Security Number

           Address

 

 

 

 

 

 

 

 

 

ALL SUBSCRIPTION DOCUMENTS MUST BE FILLED IN AND SIGNED EXACTLY AS SET FORTH
WITHIN.

 

 

 

 

 

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SUBSCRIPTION AGREEMENT

 

 

AETHLON MEDICAL, INC.

 

 

Aethlon Medical, Inc.

8910 University Center Lane, Suite 660

San Diego, California 92122

Attn: James A. Joyce, CEO

 

Ladies and Gentlemen:

 

1.          Subscription. The undersigned (the “Purchaser”) will purchase the
number of units (collectively, the “Units”) of securities of Aethlon Medical,
Inc., a Nevada corporation (the “Company”), set forth on the signature page to
this Subscription Agreement, at a purchase price of $12,500 per Unit, with each
Unit consisting of (a) one hundred thousand (100,000) shares of the Company’s
common stock par value $0.001 per share (the “Common Stock”) at a purchase price
of $0.125 per share, and (b) a five-year warrant (collectively, the “Warrants”
and together with the Units and Common Stock, the “Securities”) to purchase
fifty thousand (50,000) shares of Common Stock of the Company at an exercise
price equal to $0.22 per share, subject to adjustment thereunder (the “Exercise
Price”). The Units are being offered (the “Offering”) by the Company pursuant to
the offering terms set forth in the Company’s Confidential Private Placement
Memorandum, dated October 10, 2013, as may be amended and/or supplemented, from
time to time (collectively, the “Memorandum”).

 

The Units are being offered on a “reasonable efforts, all or none” basis with
respect to the minimum of $200,000 purchase price for the Units (the “Minimum
Offering”) and thereafter on a “reasonable efforts” basis up to the maximum of
$2,000,000 purchase price for the Units (the “Maximum Offering”). The Units will
be offered for sale until the earlier of (i) the date upon which subscriptions
for the Maximum Offering offered hereunder have been accepted, (ii) November 30,
2013 (subject to the right of the Company and the Placement Agent to extend the
offering until December 31, 2013 without further notice to investors), or (iii)
the date upon which the Company and the Placement Agent elect to terminate the
Offering (the “Termination Date”).

 

The Company may hold an initial closing (“Initial Closing”) at any time after
the receipt of accepted subscriptions for the Minimum Offering. After the
Initial Closing, subsequent closings with respect to additional Securities may
take place at any time prior to the Termination Date as determined by the
Company, with respect to subscriptions accepted prior to the Termination Date
(each such closing, together with the Initial Closing, being referred to as a
“Closing”). The last Closing of the Offering, occurring on or prior to the
Termination Date, shall be referred to as the “Final Closing”. Any subscription
documents or funds received after the Final Closing will be returned, without
interest or deduction. In the event that the any Closing does not occur prior to
the Termination Date, all amounts paid by the Purchaser shall be returned to the
Purchaser, without interest or deduction.

 

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Subscriptions for investment below the minimum investment may be accepted at the
discretion of the Placement Agent and the Company. The Company reserves the
right (but is not obligated) to have its employees, agents, officers, directors
and affiliates purchase Units in the Offering and all such purchases will be
counted towards the Minimum Offering and the Maximum Offering.

 

The terms of the Offering are more completely described in the Memorandum and
such terms are incorporated herein in their entirety. Certain capitalized terms
used, but not otherwise defined herein, will have the respective meanings
provided in the Memorandum.

 

2.          Payment. The Purchaser encloses herewith a check payable to, or will
immediately make a wire transfer payment to, “_________________, as Escrow Agent
for Aethlon Medical, Inc.,” in the full amount of the purchase price of the
Units being subscribed for. Together with the check for, or wire transfer of,
the full purchase price, the Purchaser is delivering a completed and executed
Signature Page to this Subscription Agreement along with a completed and
executed Accredited Investor Certification, which are annexed hereto. By
executing this Subscription Agreement, you will be deemed to have executed the
Unit Purchase Agreement (Exhibit B to the Memorandum), and agreed to the terms
of the Warrant (Exhibit C to the Memorandum) and all exhibits, supplements and
schedules thereto, as such may be amended from time to time (collectively the
“Transaction Documents”), each of which are attached to the Memorandum, and will
be treated for all purposes as if you did review, approve and execute, if
required, each such Transaction Document even though you may not have physically
signed the signature pages to such documents.

 

3.          Deposit of Funds. All payments made as provided in Section 2 hereof
will be deposited by the Purchaser as soon as practicable with
_________________, as escrow agent (the “Escrow Agent”), or such other escrow
agent appointed by ___________ and the Company, in a non-interest bearing escrow
account (the “Escrow Account”). In the event that the Company does not effect a
Closing during the Offering Period, the Escrow Agent will refund all
subscription funds, without deduction and/or interest accrued thereon, and will
return the subscription documents to each Purchaser. If the Company or
___________ rejects a subscription, either in whole or in part (at the sole
discretion of the Company or ___________), the rejected subscription funds or
the rejected portion thereof will be returned promptly to such Purchaser without
interest, penalty, expense or deduction.

 

4.          Acceptance of Subscription. The Purchaser understands and agrees
that the Company or ___________, each in its sole discretion, reserves the right
to accept this or any other subscription for the Units, in whole or in part,
notwithstanding prior receipt by the Purchaser of notice of acceptance of this
or any other subscription. The Company will have no obligation hereunder until
the Company executes and delivers to the Purchaser an executed copy of the
Purchase Agreement. If Purchaser’s subscription is rejected in whole (at the
sole discretion of the Company or ___________), the Offering is terminated or
the Minimum Offering is not subscribed for and accepted prior to the Termination
Date, all funds received from the Purchaser will be returned without interest,
penalty, expense or deduction, and this Subscription Agreement will thereafter
be of no further force or effect. If Purchaser’s subscription is rejected in
part (at the sole discretion of the Company or ___________) and the Company
accepts the portion not so rejected, the funds for the rejected portion of such
subscription will be returned without interest, penalty, expense or deduction,
and this Subscription Agreement will continue in full force and effect to the
extent such subscription was accepted. The Purchaser may revoke its subscription
and obtain a return of the subscription amount paid to the Escrow Account at any
time before the date of the Initial Closing. The Purchaser may not revoke this
subscription or obtain a return of the subscription amount paid to the Escrow
Agent on or after the date of the Initial Closing. Any subscription received
after the Initial Closing but prior to the Termination Date shall be
irrevocable.

 

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5.          Representations and Warranties of the Purchaser. The Purchaser
hereby acknowledges, represents, warrants, and agrees as follows:

 

(a)          None of the Units, the Common Stock, the Warrants or the shares of
Common Stock of the Company issuable upon exercise of the Warrants (collectively
referred to hereafter as the “Securities”) 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 Securities is
intended to be exempt from registration under the Securities Act, by virtue of
Section 4(2) thereof and the provisions of Regulation D promulgated thereunder,
based, in part, upon the representations, warranties and agreements of the
Purchaser contained in this Subscription Agreement and the Purchase Agreement;

 

(b)          The Purchaser and the Purchaser’s attorney, accountant, purchaser
representative and/or tax advisor, if any (collectively, “Advisors”), have
received and have carefully reviewed the Memorandum, this Subscription
Agreement, and each of the Transaction Documents and all other documents
requested by the Purchaser or its Advisors, if any, and understand the
information contained therein, prior to the execution of this Subscription
Agreement;

 

(c)          Neither the Securities and Exchange Commission (the “Commission”)
nor any state securities commission has approved or disapproved of the
Securities or passed upon or endorsed the merits of the Offering or confirmed
the accuracy or determined the adequacy of the Memorandum. The Memorandum has
not been reviewed by any Federal, state or other regulatory authority. Any
representation to the contrary may be a criminal offense;

 

(d)          All documents, records, and books pertaining to the investment in
the Securities including, but not limited to, all information regarding the
Company and the Securities, have been made available for inspection and reviewed
by the Purchaser and its Advisors, if any;

 

(e)          The Purchaser and its Advisors, if any, have had a reasonable
opportunity to ask questions of and receive answers from the Company’s officers
and any other persons authorized by the Company to answer such questions,
concerning, among other related matters, the Offering, the Securities, the
Transaction Documents and the business, financial condition, results of
operations and prospects of the Company and all such questions have been
answered by the Company to the full satisfaction of the Purchaser and its
Advisors, if any;

 

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(f)          In evaluating the suitability of an investment in the Company, the
Purchaser has not relied upon any representation or other 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 Securities 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 over the Internet, in connection with the offering and sale of the Securities
and is not subscribing for the Securities and did not become aware of the
Offering 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 which 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
(other than fees to be paid by the Company to ___________, as described in the
Memorandum);

 

(i)          The Purchaser, either alone or together with its Advisors, 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 Securities and the Company and to make
an informed investment decision with respect thereto;

 

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

 

(k)          The Purchaser is acquiring the Securities solely for such
Purchaser’s own account for investment and not with a view to resale or
distribution thereof, in whole or in part. The Purchaser has no agreement or
arrangement, formal or informal, with any person to sell or transfer all or any
part of any of the Securities and the Purchaser has no plans to enter into any
such agreement or arrangement;

 

(l)          The Purchaser understands and agrees that purchase of the
Securities is a high risk investment and the Purchaser is able to afford an
investment in a speculative venture having the risks and objectives of the
Company. The Purchaser must bear the substantial economic risks of the
investment in the Securities indefinitely because none of the Securities 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 will be placed on the certificates
representing the Common Stock, the Warrants and the shares of Common Stock
issuable upon exercise of the Warrants to the effect that such securities have
not been registered under the Securities Act or applicable state securities laws
and appropriate notations thereof will be made in the Company’s books;

 

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

 

(n)          The Purchaser is aware that an investment in the Securities
involves a number of very significant risks and has carefully read and
considered the Company's periodic filings with the United States Securities and
Exchange Commission, and the matters set forth in the Memorandum and, in
particular, the matters under the caption “Risk Factors” therein and understands
any of such risk may materially adversely affect the Company’s operations and
future prospects;

 

(o)          At the time such Purchaser was offered the Securities, it was, and
as of the date hereof it is, and on each date on which it exercises any
Warrants, it will be an “accredited investor” within the meaning of Regulation
D, Rule 501(a), promulgated by the Securities and Exchange Commission under the
Securities Act and has truthfully and accurately completed the Purchaser
Questionnaire attached to this Subscription Agreement and will submit to the
Company such further assurances of such status as may be reasonably requested by
the Company;

 

(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 association, joint
stock company, trust, unincorporated organization or other entity, represents
that such entity was not formed for the specific purpose of acquiring the
Securities, 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, the
execution and delivery of this Subscription Agreement has been duly authorized
by all necessary action, this Subscription Agreement has been duly executed and
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;

 

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(q)          The Purchaer hereby acknowledges receipt and careful review of this
Agreement, the Memorandum, the Warrant and all other exhibits, annexes and
appendices thereto (collectively referred to as the “Offering Materials”), and
has had access to the Company’s Annual Report on Form 10-K and the exhibits
thereto for the fiscal year ended March 31, 2013 (the “Form 10-K”), the
Company’s Quarterly Report on Form 10-Q and the exhibits thereto for the
quarterly period ended June 30, 2013 (the “Form 10-Q”) and all subsequent
periodic and current reports filed with the United States Securities and
Exchange Commission (the “SEC”) as publicly filed with and available at the
website of the SEC which can be accessed at www.sec.gov, and hereby represents
that the Purchaser has been furnished by the Company during the course of the
Offering with all information regarding the Company, the terms and conditions of
the Offering and any additional information that the Purchaser has requested or
desired to know, has been afforded the opportunity to ask questions of and
receive answers from duly authorized officers or other representatives of the
Company concerning the Company and has been provided any such additional
information by the Company in writing to the full satisfaction of the Purchaser,
if any;

 

(r)          The Purchaser represents to the Company that any information which
the undersigned has heretofore furnished or is furnishing herewith to the
Company is complete and accurate and may be relied upon by the Company 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;

 

(s)          The Purchaser has significant prior investment experience,
including investment in non-listed and unregistered securities. 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 Securities will not cause such commitment to become excessive. This
investment is a suitable one for the Purchaser;

 

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

 

(u)          The Purchaser acknowledges that any and all estimates or
forward-looking statements or projections included in the Memorandum were
prepared by the Company in good faith, but that the attainment of any such
projections, estimates or forward-looking statements cannot be guaranteed, will
not be updated by the Company 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 its Advisors, if any, in
connection with the offering of the Securities 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,
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 is subject;

 

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(x)          THE SECURITIES OFFERED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OR THE SECURITIES LAWS OF CERTAIN STATES 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 APPROVED OR DISAPPROVED BY THE 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. ANY REPRESENTATION TO THE CONTRARY IS
UNLAWFUL;

 

(y)          In making an investment decision, investors must rely on their own
examination of Company and the terms of the Offering, including the merits and
risks involved. Investors should be aware that they 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 or Plan
fiduciary (a) is responsible for the decision to invest in the Company; (b) is
independent of the Company and any of its affiliates; (c) is qualified to make
such investment decision; and (d) in making such decision, the Purchaser or Plan
fiduciary has not relied on any advice or recommendation of the Company or any
of its affiliates; and

 

(aa)          The Purchaser has read in its entirety the Memorandum and all
exhibits and annexes thereto, including, but not limited to, all information
relating to the Company, and the Securities, and understands fully to its full
satisfaction all information included in the Memorandum including, but not
limited to, the Section entitled “Risk Factors”.

 

(bb)          The Purchaser represents that (i) the Purchaser was contacted
regarding the sale of the Securities by the Company or the Placement Agent (or
another person whom the Purchaser believed to be an authorized agent or
representative thereof) with whom the Purchaser had a prior substantial
pre-existing relationship and (ii) it did not learn of the offering of the
Securities by means of any form of general solicitation or general advertising,
and in connection therewith, the Purchaser did not (A) receive or review any
advertisement, article, notice or other communication published in a newspaper
or magazine or similar media or broadcast over television or radio, whether
closed circuit, or generally available; or (B) attend any seminar meeting or
industry investor conference whose attendees were invited by any general
solicitation or general advertising.

 

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(cc)          The Purchaser consents to the placement of a legend on any
certificate or other document evidencing the Securities and, when issued, the
shares of Common Stock issuable upon exercise of the Warrants (the “Warrant
Shares”), that such securities have not been registered under the Securities Act
or any state securities or “blue sky” laws and setting forth or referring to the
restrictions on transferability and sale thereof contained in this Agreement.
The Purchaser is aware that the Company will make a notation in its appropriate
records with respect to the restrictions on the transferability of such
Securities. The legend to be placed on each certificate shall be in form
substantially similar to the following:

 

“THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED
STATES SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”) OR ANY STATE SECURITIES OR
“BLUE SKY LAWS,” AND MAY NOT BE OFFERED, SOLD, TRANSFERRED, ASSIGNED, PLEDGED OR
HYPOTHECATED ABSENT AN EFFECTIVE REGISTRATION THEREOF UNDER SUCH ACT OR
COMPLIANCE WITH RULE 144 PROMULGATED UNDER SUCH ACT, OR UNLESS THE COMPANY HAS
RECEIVED AN OPINION OF COUNSEL, REASONABLY SATISFACTORY TO THE COMPANY AND ITS
COUNSEL, THAT SUCH REGISTRATION IS NOT REQUIRED.”

 

(dd)          The Purchaser acknowledges that if he or she is a Registered
Representative of a Financial Industry Regulatory Authority (“FINRA”) member
firm, he or she must give such firm the notice required by the FINRA’s Rules of
Fair Practice, receipt of which must be acknowledged by such firm prior to an
investment in the Securities.

 

(ee)          To effectuate the terms and provisions hereof, the Purchaser
hereby appoint the Placement Agent as its attorney-in-fact (and the Placement
Agent hereby accepts such appointment) for the purpose of carrying out the
provisions of the Escrow Agreement by and between the Company, the Placement
Agent and _________________ (the “Escrow Agreement”) including, without
limitation, taking any action on behalf of, or at the instruction of, the
Purchaser and executing any release notices required under the Escrow Agreement
and taking any action and executing any instrument that the Placement Agent may
deem necessary or advisable (and lawful) to accomplish the purposes hereof. All
acts done under the foregoing authorization are hereby ratified and approved and
neither the Placement Agent nor any designee nor agent thereof shall be liable
for any acts of commission or omission, for any error of judgment, for any
mistake of fact or law except for acts of gross negligence or willful
misconduct. This power of attorney, being coupled with an interest, is
irrevocable while the Escrow Agreement remains in effect.

 

(ff)          The Purchaser agrees not to issue any public statement with
respect to the Offering, Purchaser’s investment or proposed investment in the
Company or the terms of any agreement or covenant between them and the Company
without the Company’s prior written consent, except such disclosures as may be
required under applicable law.

 

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(gg)          The Purchaser understands, acknowledges and agrees with the
Company that this subscription may be rejected, in whole or in part, by the
Company, in the sole and absolute discretion of the Company, at any time before
any Closing notwithstanding prior receipt by the Purchaser of notice of
acceptance of the Purchaser’s subscription.

 

(hh)          The Purchaser acknowledges that the information contained in the
Offering Materials or otherwise made available to the Purchaser is confidential
and non-public and agrees that all such information shall be kept in confidence
by the Purchaser and neither used by the Purchaser for the Purchaser’s personal
benefit (other than in connection with this subscription) nor disclosed to any
third party for any reason, notwithstanding that a Purchaser’s subscription may
not be accepted by the Company; provided, however, that (a) the Purchaser may
disclose such information to its affiliates and advisors who may have a need for
such information in connection with providing advice to the Purchaser with
respect to its investment in the Company so long as such affiliates and advisors
have an obligation of confidentiality, and (b) this obligation shall not apply
to any such information that (i) is part of the public 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 this provision) or (iii) is received from third parties
without an obligation of confidentiality (except third parties who disclose such
information in violation of any confidentiality agreements or obligations,
including, without limitation, any subscription or other similar agreement
entered into with the Company).

 

(ii)          The Purchaser understands that Rule 144 promulgated under the Act
(“Rule 144”) requires, among other conditions, a minimum holding period of
six-months prior to the resale of securities acquired in a non-public offering
without having to satisfy the registration requirements under the Act. The
Purchaser understands and hereby acknowledges that the Company is under no
obligation to register the Securities under the Act or any state securities or
“blue sky” laws or to assist the Purchaser in obtaining an exemption from
various registration requirements, other than as set forth herein.

 

6.          Representations and Warranties of the Company.

 

7.          Indemnification. The Purchaser agrees to indemnify and hold harmless
the Company, ___________ and each of their respective officers, directors,
managers, employees, agents, attorneys, 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 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 or any other Transaction Document.

 

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8.          Binding Effect. This Subscription Agreement will survive the death
or disability of the Purchaser and will 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 will be joint and several and
the agreements, representations, warranties and acknowledgments herein will 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.

 

9.          Modification. This Subscription Agreement will not be modified or
waived except by an instrument in writing signed by the party against whom any
such modification or waiver is sought.

 

10.          Notices. Any notice or other communication required or permitted to
be given hereunder will be in writing and will be mailed by certified mail,
return receipt requested, or delivered by reputable overnight courier such as
FedEx against receipt to the party to whom it is to be given (a) if to the
Company, at the address set forth in the Purchase Agreement 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 will have furnished in writing in
accordance with the provisions of this Section 10). Any notice or other
communication given by certified mail will be deemed given at the time of
certification thereof, except for a notice changing a party’s address which will
be deemed given at the time of receipt thereof. Any notice or other
communication given by overnight courier will be deemed given at the time of
delivery.

 

11.          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 any of the Securities will be made
only in accordance with all applicable laws.

 

12.          Applicable Law. This Subscription Agreement will be governed by and
construed under the laws of the State of New York as applied to agreements among
New York residents entered into and to be performed entirely within New York.
The parties hereto (1) agree that any legal suit, action or proceeding arising
out of or relating to this Subscription Agreement will be instituted exclusively
in New York State Supreme Court, County of New York, or in the United States
District Court for the Southern District of New York, (2) waive any objection
which the parties may have now or hereafter to the venue of any such suit,
action or proceeding, and (3) irrevocably consent to the jurisdiction of the New
York State Supreme Court, County of New York, and the United States District
Court for the Southern District of New York in any such suit, action or
proceeding. Each of the parties hereto further agrees to accept and acknowledge
service of any and all process which may be served in any such suit, action or
proceeding in the New York State Supreme Court, County of New York, or in the
United States District Court for the Southern District of New York and agrees
that service of process upon it mailed by certified mail to its address will be
deemed in every respect effective service of process upon it, in any such suit,
action or proceeding. THE PARTIES HERETO AGREE, TO THE EXTENT PERMITTED BY
APPLICABLE LAW, TO WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR
CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS SUBSCRIPTION AGREEMENT OR ANY
DOCUMENT OR AGREEMENT CONTEMPLATED HEREBY.

 

12

 

 

13.          Blue Sky Qualification. The purchase of Securities pursuant to this
Subscription Agreement is expressly conditioned upon the exemption from
qualification of the offer and sale of the Securities from applicable federal
and state securities laws.

 

14.          Use of Pronouns. All pronouns and any variations thereof used
herein will be deemed to refer to the masculine, feminine, neuter, singular or
plural as the identity of the person or persons referred to may require.

 

15.          Confidentiality. The Purchaser acknowledges and agrees that any
information or data the Purchaser has acquired from or about the Company 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 Subscription Agreement, or use to
the detriment of the Company or for the benefit of any other person or persons,
or misuse in any way, any confidential information of the Company, including any
trade or business secrets of the Company and any business materials that are
treated by the Company as confidential or proprietary, including, without
limitation, confidential information obtained by or given to the Company about
or belonging to third parties.

 

16.          Miscellaneous.

 

(a)          This Subscription Agreement, together with the other Transaction
Documents, 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 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)          Each of the Purchaser’s and the Company’s representations and
warranties made in this Subscription Agreement will survive the execution and
delivery hereof and delivery of the Securities.

 

(c)          Each of the parties hereto will 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 will be deemed an original, but all of which will
together constitute one and the same instrument.

 

(e)          Each provision of this Subscription Agreement will 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 will not impair the operation of or affect the remaining portions of
this Subscription Agreement.

 

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

 

17.          Signature Page. It is hereby agreed by the parties hereto that the
execution by the Purchaser of this Subscription Agreement, in the place set
forth hereinbelow, will be deemed and constitute the agreement by the Purchaser
to be bound by all of the terms and conditions hereof as well as by the Unit
Purchase Agreement and each of the other Transaction Documents, and will be
deemed and constitute the execution by the Purchaser of all such Transaction
Documents without requiring the Purchaser’s separate signature on any of such
Transaction Documents.

 

 

 

 

 

[Remainder of page intentionally left blank.]

 

 

 

 

 

 

 

 

 

 

 

14

 

 

ANTI-MONEY LAUNDERING REQUIREMENTS

 

 

 

 

 

The USA PATRIOT Act

 

 

 

What is money laundering? How big is the problem and why is it important?

 

 

The USA PATRIOT Act is designed to detect, deter, and punish terrorists in the
United States and abroad. The Act imposes new anti-money laundering requirements
on brokerage firms and financial institutions. Since April 24, 2002 all
brokerage firms have been required to have new, comprehensive anti-money
laundering programs.

 

To help you understand theses efforts, we want to provide you with some
information about money laundering and our steps to implement the USA PATRIOT
Act.

 

 

 

Money laundering is the process of disguising illegally obtained money so that
the funds appear to come from legitimate sources or activities. Money laundering
occurs in connection with a wide variety of crimes, including illegal arms
sales, drug trafficking, robbery, fraud, racketeering, and terrorism.

 

 

 

The use of the U.S. financial system by criminals to facilitate terrorism or
other crimes could well taint our financial markets. According to the U.S. State
Department, one recent estimate puts the amount of worldwide money laundering
activity at $1 trillion a year.

 

 

 

What are we required to do to eliminate money laundering?

 

 

Under new rules required by the USA PATRIOT Act, our anti-money laundering
program must designate a special compliance officer, set up employee training,
conduct independent audits, and establish policies and procedures to detect and
report suspicious transaction and ensure compliance with the new laws.

 

 

 

As part of our required program, we may ask you to provide various
identification documents or other information. Until you provide the information
or documents we need, we may not be able to effect any transactions for you.

 

 

 

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AETHLON MEDICAL, INC.

SIGNATURE PAGE TO

SUBSCRIPTION AGREEMENT

 

Purchaser hereby elects to purchase a total of ______Unit(s) at a purchase price
of $12,500 per Unit (NOTE: to be completed by the Purchaser).

 

Date (NOTE: To be completed by the Purchaser): __________________, 2013

 

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 Purchaser(s) Signature    
____________________________ ______________________________ Date Address

 

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

 

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

 

AGREED AND ACCEPTED:

 

AETHLON MEDICAL, INC.

  

By:__________________________ _________________       Name: Date       Title:  

 

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AETHLON MEDICAL, INC.

ACCREDITED INVESTOR CERTIFICATION

 

For Individual Investors Only

(All individual investors must INITIAL where appropriate. Where there are joint
investors both parties must INITIAL):

 

Initial _______     I certify that I have a “net worth” of at least $1 million
either individually or through aggregating my individual holdings and those in
which I have a joint, community property or other similar shared ownership
interest with my spouse. For purposes of calculating net worth under this
paragraph, (i) the primary residence shall not be included as an asset, (ii) to
the extent that the indebtedness that is secured by the primary residence is in
excess of the fair market value of the primary residence, the excess amount
shall be included as a liability, and (iii) if the amount of outstanding
indebtedness that is secured by the primary residence exceeds the amount
outstanding 60 days prior to the execution of this Subscription Agreement, other
than as a result of the acquisition of the primary residence, the amount of such
excess shall be included as a liability.

 

Initial _______     I certify that 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.

 

 

For Non-Individual Investors

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

 

Initial _______    The undersigned certifies that it is a partnership,
corporation, limited liability company or business trust that is 100% owned by
persons who meet either of the criteria for Individual Investors, above.

 

Initial _______    The undersigned certifies that it is a partnership,
corporation, limited liability company or business trust that has total assets
of at least $5 million and was not formed for the purpose of investing in
Company.

 

Initial _______    The undersigned certifies that it is an employee benefit plan
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 undersigned certifies that it is an employee benefit plan
whose total assets exceed $5,000,000 as of the date of the Subscription
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, above.

 

Initial _______    The undersigned 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 undersigned 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 Company.

 

Initial _______    The undersigned certifies that it is a trust with total
assets of at least $5,000,000, not formed for the specific purpose of investing
in 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 undersigned 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 undersigned certifies that it is an insurance company as
defined in §2(a)(13) of the Securities Act of 1933, as amended, or a registered
investment company.

 

17

 

 

AETHLON MEDICAL, INC.

Purchaser Questionnaire

(Must be completed by Purchaser)

 

 

Section A - Individual Purchaser Information

 

Purchaser Name(s):
________________________________________________________________________

 

Individual executing Profile or Trustee:
_______________________________________________________________________

 

Social Security Numbers / Federal I.D. Number:
________________________________________________________________________

 

Date of Birth: _________________ Marital Status: _________________

 

Joint Party Date of Birth:_________________

Investment Experience (Years): ___________

 

Annual Income: _________________

Liquid Net Worth:____________

 

Net Worth: ________________

 

Investment Objectives (circle one or more):     Long Term Capital Appreciation,
Short Term Trading, Businessman’s Risk, Income, Safety of Principal, Tax Exempt
Income or other

 

Home Street Address:
________________________________________________________________________

 

Home City, State & Zip Code:
________________________________________________________________________

 

Home Phone: ________________________ Home Fax: _____________________

 

Home Email: _______________________________

 

Employer:
________________________________________________________________________

 

Employer Street Address:
________________________________________________________________________

 

Employer City, State & Zip Code:
________________________________________________________________________

 

Bus. Phone: __________________________ Bus. Fax: _______________________

 

Bus. Email: ________________________________

 

Type of Business:
________________________________________________________________________

 

___________ Account Executive / Outside Broker/Dealer:
_______________________________________________________

 

Please check if you are a FINRA member or affiliate of a FINRA member firm:
_______

 

18

 

 

AETHLON MEDICAL, INC.

Purchaser Questionnaire

(Must be completed by Purchaser)

 

 

Section B – Entity Purchaser Information

 

Purchaser Name(s):
________________________________________________________________________

 

Authorized Individual executing Profile or Trustee:
_______________________________________________________________________

 

Social Security Numbers / Federal I.D. Number:
________________________________________________________________________

 

Investment Experience (Years): ___________

 

Annual Income: _______________

 

Net Worth: ________________

 

Was the Entity formed for the specific purpose of purchasing the Common Stock
and Warrants? [  ] Yes [  ] No

 

Principal Purpose (Trust)______________________________________

 

Type of Business: ________________________________________________________

 

Investment Objectives (circle one or more):     Long Term Capital Appreciation,
Short Term Trading, Businessman’s Risk, Income, Safety of Principal, Tax Exempt
Income or other

 

Street Address:
________________________________________________________________________

 

City, State & Zip Code:
________________________________________________________________________

 

Phone: ________________________ Fax: ________________________

 

Email: __________________________

 

___________ Account Executive / Outside Broker/Dealer:

 

_______________________________________________________

 

Please check if you are a FINRA member or affiliate of a FINRA member firm:
_______

 

 

19

 

 

Section C – Form of Payment – Check or Wire Transfer

 

 

____ Check payable to “_________________, AS ESCROW AGENT FOR AETHLON MEDICAL,
INC.

 

____ Wire funds from my outside account according to the “To subscribe for Units
of Common Stock and Warrants to Purchase Shares of Common Stock in the private
offering of AETHLON MEDICAL, INC.”

 

____ Wire funds from my _________________ Account – See following page

 

____ The funds for this investment are rolled over, tax deferred from
____________________ within the Allowed 60-day window

 

 

Section D – Purchaser Instructions for Payments of any Dividends

 

[  ] Please make any dividend and any other payment checks pursuant to the Units
to “_________________ c/f [Insert Client Name]” and deliver such checks to
_________________ so that they may deposit them into my _________________
brokerage account

 

[  ] Please make out any dividend and any other payment checks pursuant to the
Units in the registered name of the Purchaser set forth in the signature page to
the Subscription Agreement for the Units and mail such checks to me at the
address specified in such signature page

 

 

Section E – Securities Delivery Instructions (check one)

 

____ Please deliver my securities to _________________ for deposit into my
brokerage account.

 

____ Please deliver my securities to the address listed in the above Purchaser
Questionnaire.

 

____ Please deliver my securities to the below address:

_________________

_________________

_________________

_________________

 

Purchaser Signature(s): _______________________________________
Date:_______________

 

20

 

 

Wire Transfer Authorization

 

TO: OPERATIONS MANAGER   _________________     RE: Client Wire Transfer
Authorization   AETHLON MEDICAL, INC.     DATE: ________________

 

 

 

This memorandum authorizes the transfer of the following listed funds from my
_________________ Brokerage Account as follows:

 

_________________ Brokerage Account #    ______________________

 

Wire Amount     $______________________

 

_________________

_________________

_________________

 

ABA Number:

For Credit to _________________, as Escrow Agent for

Aethlon Medical, Inc.

Account No.:

 

 

REFERENCE:

 

PURCHASER'S LEGAL NAME
    ______________________________________________________

 

TAX ID NUMBER    ______________________________________________________

 

PURCHASER'S ADDRESS    ______________________________________________________

 

FBO: ________________________________________________

 

 

Signature:________________________________________________

 

Signature:________________________________________________

       (Joint Signature)

 

 

21