EXHIBIT 10.8

 

Subscription Agreement No.: ____________

 

Name: ________________

 

Date: _____________

 

GYROTRON TECHNOLOGY, INC.

 

SUBSCRIPTION AGREEMENT

 

SERIES A4 PREFERRED STOCK

 

Gyrotron Technology, Inc.

3412 Progress Drive

Bensalem, Pennsylvania 19020

 

Gentlemen:

 

1. Subscription.

 

(a) The undersigned subscriber (the “Subscriber”), intending to be legally
bound, hereby irrevocably subscribes to purchase from Gyrotron Technology, Inc.,
a Delaware corporation (the “Company”) _______ shares of 10% Convertible
Redeemable Series A4 Preferred Stock, par value $0.001 per share (the “Series A4
Preferred Stock” or “Shares”), of the Company at a price of $30.00 per share,
plus accrued dividends, if any; all as set forth on the signature page hereof.
The form of Certificate of Designation (“COD”) for the Series A4 Preferred
Stock, is attached as Exhibit B and all references to its terms are qualified in
their entirety by reference to said exhibit.

 

This subscription is made in accordance with and subject to the terms and
conditions described in this Subscription Agreement (this “Agreement”) and any
other documents concerning the Company that have been furnished to the
Subscriber concerning the Offering (the “Other Offer Documents”).

 

The Shares that are the subject of this Agreement are part of an offering of
Shares by the Company (the “Offering”), on a best efforts basis. The number of
Shares that the Company may offer and/or sell is at the Company’s discretion.

 

The Company may use broker-dealers and other agents to offer and sell the
Shares, and/or finders identify and introduce potential subscribers to the
Company. Compensation may be paid to these persons in the amount of up to 6% of
the gross proceeds to the Company of the Shares that they have placed, to be
paid in cash and/or in Shares.

 

  -1-

   

 

The Company may terminate the Offering at any time without prior notice. Also,
the Company, in its sole discretion, may accept or reject this subscription in
whole or in part for any reason, but the Company will issue Shares. If the
Company decides to reject this subscription, it will do so promptly following
its receipt and will return the Subscriber’s funds without interest as soon as
practicable.

 

The Series A4 Preferred Stock pro forma began to accrue dividends as of June
30xx, 2018. In lieu of requesting payment in the amount of dividends accrued
through the date of delivery of the Subscriber’s subscription payment, the
Company will withhold from the dividend payments otherwise payable to a
Subscriber the amount of the dividends accrued through the date of delivery of
the subscription payment.

 

THE SHARES BEING OFFERED HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER THE
SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION, NOR HAS THE SECURITIES AND
EXCHANGE COMMISSION OR ANY APPLICABLE STATE OR OTHER REGULATORY AUTHORITY PASSED
UPON THE ACCURACY OR ADEQUACY OF THE OTHER OFFER DOCUMENTS OR ENDORSED THE
MERITS OF THE OFFERING. ANY REPRESENTATION TO THE CONTRARY IS UNLAWFUL.

 

THE SHARES ARE OFFERED PURSUANT TO EXEMPTIONS PROVIDED BY THE SECURITIES ACT,
CERTAIN STATE SECURITIES LAWS AND CERTAIN RULES AND REGULATIONS PROMULGATED
PURSUANT THERETO. NEITHER THE SHARES AND THE WARRANTS NOR ANY INTEREST THEREIN
MAY BE SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT AND COMPLIANCE WITH ANY APPLICABLE STATE OR
OTHER SECURITIES LAWS OR AN EXEMPTION FROM SUCH REGISTRATION REQUIREMENT AND
COMPLIANCE, THE AVAILABILITY OF WHICH MUST BE ESTABLISHED TO THE SATISFACTION OF
THE COMPANY.

 

The Subscriber understands that the Shares are being is-sued pursuant to the
exemption from the registration requirements of the Securities Act, provided by
Section 4(2) of such Act, or Regulation D promulgated thereunder, or both. As
such, the Company is relying on the representations made by the Subscriber in
this Agreement. The Shares are “restricted securities” for purposes of the
United States securities laws and cannot be transferred except as permitted
under these laws.

 

(b) The Subscriber is delivering (i) two executed copies of the signature page
of this Agreement (including Exhibit A), and (ii) the subscription pay-ment, in
the form of:

 

(x) a check payable to “Gyrotron Technology, Inc.” to:

 

Gyrotron Technology, Inc.

3412 Progress Drive

Bensalem, Pennsylvania 19020

Attention: Vlad Sklyar; or

 

  -2-

   

 

(y) a wire transfer to “Gyrotron Technology, Inc.”,

 

Wire Transfer Instructions to the Company:

 

Bank: Wells Fargo Bank.

 

Swift WFBIUS6S

 

ABA No.: 121000248

 

Account No.: 3981568409

 

Account Name:

 

Gyrotron Technology Inc.

 

Ref: Series A4 Shares;

 

or (z) by agreeing to accept Shares for funds previously advanced to the Company
or other amounts due Subscriber from Company.

 

If this subscription is accepted by the Company, in whole or in part, then, as
soon as practicable following the acceptance, the Company will deliver to the
Subscriber a certificate representing the Shares that the Subscriber has
subscribed for and a fully executed copy of this Agreement.

 

If the Offering is oversubscribed, or for any other reason determined by the
Company in its discretion, the Company may determine to accept a subscription
for only a portion of the Shares for which the Subscriber has subscribed in this
Agreement. In such a case, the Company will deliver the portion of the Shares
that the Company has agreed to sell to the Subscriber, and the balance of the
purchase price will be repaid to the Subscriber without interest.

 

(c) The Subscriber may not withdraw this subscription or any amount paid
pursuant thereto.

 

2. Conditions. It is understood and agreed that this subscription is made
subject to all terms and conditions set forth in this Agreement, including those
set forth in Section 1 above.

 

3. Representations and Warranties of the Company. The Company represents and
warrants to, and agrees with the Subscriber as follows, in each case as of the
date hereof and in all material respects as of the date of any closing, except
for any changes resulting solely from the Offering:

 

(a) The Company is duly organized, validly existing and in good standing under
the laws of the jurisdiction of its incorporation with full power and authority
to own, lease, license and use its properties and assets and to carry out the
business in which it is engaged. The Company is duly qualified to transact the
business in which it is engaged and is in good standing as a foreign corporation
in every jurisdiction in which its ownership, leasing, licensing or use of
property or assets or the conduct of its business makes such qualification
necessary, except where the failure to be so qualified would not have a material
adverse effect on the Company.

 

  -3-

   

 

(b) Except as described herein or in the Other Offer Documents, there is no
commitment, plan or arrangement to issue, and no outstanding option, warrant or
other right calling for the issuance of, any share of capital stock of the
Company or any security or other instrument which by its terms is convertible
into, exercisable for or exchangeable for capital stock of the Company. The
Company may in the ordinary course pay bonuses in stock or issue options to
employees. The Company is currently seeking to raise additional capital on the
same terms as are offered herein.

 

(c) The Company has all requisite power and authority to execute, deliver and
perform its obligations under this Agreement and to issue and sell the Shares
and the Warrants. All necessary proceedings of the Company have been duly taken
to authorize the execution, delivery, and performance of this Agreement. This
Agreement has been duly authorized by the Company and, when executed and
delivered by the Company will constitute the legal, valid and binding obligation
of the Company enforceable against the Company in accordance with its terms.

 

(d) No consent of any party to any contract, agreement, instrument, lease,
license, arrangement or understanding to which the Company or any of its
subsidiaries is a party or to which any of their respective properties or assets
are subject is required for the execution, delivery or performance by the
Company of any of this Agreement or the issuance and sale of the Shares.

 

(e) The execution, delivery and performance of this Agreement and the issuance
and sale of the Shares will not violate or result in a breach of, or entitle any
party (with or without the giving of notice or the passage of time or both) to
terminate or call a default under any contract or agreement to which the Company
is a party or violate or result in a breach of any term of the certificate of
incorporation or by-laws of the Company, or violate any law, rule, regulation,
order, judgment or decree binding upon, the Company or any of its subsidiaries,
or to which any of their respective operations, businesses, properties or assets
are subject, the breach, termination or violation of which, or default under
which, would have a material adverse effect on the operations, business,
properties or assets of the Company.

 

4. Representations, Warranties and Covenants of the Subscriber. The Subscriber
hereby represents and warrants to, and agrees with, the Company as follows:

 

(a) The Subscriber is an “Accredited Investor” as that term is de-fined in Rule
501(a) of Regulation D promulgated under the Securities Act, and as
spe-cifically indicated in Exhibit A to this Agreement, or the Subscriber is not
a “US Person” as that term is de-fined in Regulation S promulgated under the
Securities Act. [IF NOT TRUE PLEASE CROSS OUT]

 

(b) If a natural person, the Subscriber is: a bona fide resident of the state or
non-United States jurisdiction contained in the address set forth on the
signa-ture page of this Agreement as the Subscriber’s home address; at least 21
years of age; and legally competent to execute this Agreement. If an entity, the
Subscriber has its principal offices or principal place of business in the state
or non-United States jurisdic-tion contained in the address set forth on the
signature page of this Agreement, the indi-vidual signing on behalf of the
Subscriber is duly authorized to execute this Agreement.

 

  -4-

   

 

(c) This Agreement has been duly executed and delivered by the Subscriber and
constitutes the legal, valid and binding obligation of the Subscriber,
enforceable against the Subscriber in accordance with its terms.

 

(d) Neither the execution, delivery or performance of this Agree-ment by the
Subscriber violates or conflicts with, creates (with or without the giv-ing of
notice or the lapse of time, or both) a default under or a lien or encumbrance
upon any of the Subscriber’s assets or properties pursuant to, or requires the
consent, approval or order of any government or governmental agency or other
person or entity under (i) any note, indenture, lease, license or other material
agreement to which the Subscriber is a party or by which it or any of its assets
or properties is bound or (ii) any statute, law, rule, regulation or court
decree binding upon or applicable to the Subscriber or its assets or properties.
If the Subscriber is not a natural person, the execution, delivery and
per-formance by the Subscriber of this Agreement, and all other documents
relating to an in-vestment by Subscriber in the Shares, have been duly
authorized by all necessary corpo-rate or other action on behalf of the
Subscriber and such execution, delivery and perform-ance does not and will not
constitute a breach or violation of, or default under, the charter or by-laws or
equivalent governing documents of the Subscriber.

 

(e) The Subscriber has received, read carefully and is familiar with this
Agreement and the Certificate of Designation for the Series A4 Preferred Stock.

 

(f) The Subscriber, together with its professional advisor, is fa-miliar with
the Company’s business, plans and financial condition, the terms of the
Of-fering and any other matters relating to the Offering; the Subscriber has
received all ma-terials which have been requested by the Subscriber; has had a
reasonable opportunity to ask questions of the Company and its representatives;
and the Company has answered to the satisfaction of the Subscriber all inquiries
that the Subscriber or the Subscriber’s rep-resentatives have put to it. The
Subscriber has had access to all additional information that the Subscriber has
deemed necessary to verify the accuracy of the information set forth in this
Agreement and the Other Offer Documents, and has taken all the steps nec-essary
to evaluate the merits and risks of an investment as proposed under this
Agreement and the Other Offer Documents.

 

(g) The Subscriber acknowledges that this subscription is and shall be
irrevocable and this subscription and the agreements contained herein shall
sur-vive the insolvency, death or disability of the Subscriber (as applicable),
except that the Subscriber shall have no obligation hereunder in the event that
its subscription is for any reason rejected or the Offering is cancelled or
terminated by the Company, which the Company reserves the right to do in its
sole and absolute discretion and for any reason.

 

(h) The Subscriber or the Subscriber’s purchaser representative has such
knowledge and experience in finance, securities, taxation, investments and other
business matters so as to be able to protect the interests of the Subscriber in
connection with this transaction.

 

  -5-

   

 

(i) The Subscriber understands the various risks of an invest-ment in the
Company as proposed herein and can afford to bear such risks, including, without
limitation, the risks of losing the entire investment.

 

(j) The Subscriber acknowledges that there is no market for the Shares and only
a very limited market for the shares of common stock of the Company.

 

(k) The Subscriber has been advised by the Company that the Shares have not been
registered under the Securities Act, that the Shares will be issued on the basis
of the statutory exemption provided by Section 4(2) of the Securities Act or
Regulation D promulgated thereunder, or both, relating to transactions by an
issuer not involving any public offering and under similar exemptions under
certain state securities laws; that this transaction has not been reviewed by,
passed on or submitted to any United States Fed-eral or state agency or
self-regulatory organization where an exemption is being relied upon; and that
the Company’s reliance thereon is based in part upon the representations made by
the Subscriber in this Agreement.

 

(l) The Subscriber acknowledges that the Subscriber has been in-formed by the
Company of, or is otherwise familiar with, the nature of the limitations imposed
by the Securities Act and the rules and regulations thereunder on the transfer
of the Shares acquired hereunder. In particular, the Sub-scriber agrees that no
sale, assignment or transfer of any of the Shares shall be valid or effective,
and the Company shall not be required to give any effect to such a sale,
assignment or transfer, unless (i) the sale, assignment or transfer of such
Shares are registered under the Secu-rities Act, it being understood that the
Shares are not currently registered for sale and that the Company has no
obligation or intention to so register the Shares, except as contemplated by the
terms of this Agreement; (ii) the Shares are sold, assigned or transferred in
accordance with all the requirements and limitations of Rule 144 under the
Securities Act (it being understood that Rule 144 is not available at the
present time for the sale of the Shares), or (iii) such sale, assignment or
transfer is otherwise exempt from registration under the Securities Act,
including Regulation S promulgated thereunder. The Subscriber further
understands that an opinion of counsel and other documents may be required to
transfer the Shares.

 

(m) The Subscriber acknowledges that the Shares to be ac-quired will be subject
to a stop transfer order and any certificate or certificates evidencing any
Shares shall bear the following or a substantially similar legend and such other
leg-ends as may be required by state blue sky laws:

 

“THE SHARES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAWS, AND,
ACCORDINGLY, MAY NOT BE OFFERED OR SOLD WITHIN THE UNITED STATES OR TO, OR FOR
THE ACCOUNT OR BENEFIT OF U.S. PERSONS EXCEPT PURSUANT TO AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT.”

 

  -6-

   

 

(n) The Subscriber will acquire the Shares for the Subscriber’s own account (or,
if such individual is married, for the joint account of the Subscriber and the
Subscriber’s spouse either in joint tenancy, tenancy by the entirety or tenancy
in common) for investment and not with a view to the sale or distribution
thereof or the granting of any participation therein in violation of the
securities laws, and has no present intention of distributing or selling to
others any of such interest or granting any participation therein in violation
of the securities laws.

 

(o) No representation, guarantee or warranty has been made to the Subscriber by
any broker, the Company, any of the officers, directors, stockholders, partners,
employees or agents of any of them, or any other persons, whether expressly or
by implication, that:

 

(I) the Company or the Subscriber will realize any given percentage of profits
and/or amount or type of consideration, profit or loss as a result of the
Company’s activities or the Subscriber’s invest-ment in the Company; or

 

(II) the past performance or experience of the manage-ment of the Company, or of
any other person, will in any way indicate the predictable results of the
ownership of the Shares or of the Company’s activities.

 

(p) The Subscriber is not subscribing for the Shares as a result of or
subsequent to any advertisement, article, notice or other com-munication
published in any newspaper, magazine or similar media or broadcast over
television or radio, or presented at any seminar or similar gathering; or any
solicitation of a subscription by a person, other than Company personnel,
previously not known to the undersigned.

 

(q) The Subscriber is not relying on the Company with respect to the tax
considerations or the economic merit of an investment.

 

(r) The Subscriber understands that the net proceeds from all sub-scriptions
paid and accepted pursuant to the Offering (after deduction for commis-sions,
discounts and expenses of the Offering) will be used in all material respects to
fund the business and operations of the Company in the discretion of management.
It is agreed by the parties that the proceeds will be used primarily to fund
current operations.

 

(s) The Subscriber acknowledges that the representations, war-ranties and
agreements made by the Subscriber herein shall survive the execution and
de-livery of this Agreement and the purchase of the Shares.

 

(t) The Subscriber has consulted the Subscriber’s own finan-cial, legal and tax
advisors with respect to the economic, legal and tax consequences of an
investment in the Shares and has not relied on the Other Offer Documents or the
Company, its officers, directors or professional advisors for advice as to such
consequences.

 

  -7-

   

 

 

(u) Except as set forth on the signature page hereto, the Sub-scriber has not
engaged any broker or other person or entity that is entitled to a commis-sion,
fee or other remuneration as a result of the execution, delivery or performance
of this Agreement.

 

(v) For California and Massachusetts individuals: If the Sub-scriber is a
California resident, such Subscriber’s investment in the Company will not
ex-ceed 10% of such Subscriber’s net worth (or joint net worth with his spouse).
If the Sub-scriber is a Massachusetts resident, such Subscriber’s investment in
the Company will not exceed 25% of such Subscriber’s joint net worth with his
spouse (exclusive of principal residence and its furnishings).

 

5. Indemnification. The Subscriber understands the meaning and legal
consequences of the representations and warranties contained in Section 4
hereof, and agrees to indemnify and hold harmless the Company and each officer,
direc-tor, partner, employee, agent and controlling person of each of them,
past, present or fu-ture, from and against any and all loss, damage or liability
due to or arising out of a breach of any such representation or warranty.

 

6. Transferability. Neither this Agreement, nor any interest of the Subscriber
herein, shall be assignable or transferable by the Subscriber in whole or in
part except by operation of law. Any attempt to assign or transfer this
agreement or any interest therein other than by operation of law shall be void.
Notwithstanding the foregoing, Subscriber may transfer the securities acquired
hereunder in accordance with the provisions of paragraph 4(l) above.

 

7. Confidentiality. The Subscriber acknowledges and agrees that confidential
information, written and oral, concerning the Company furnished from time to
time to the Subscriber, has been and is provided on a confidential basis. The
Subscriber further acknowledges and agrees that it may not disclose such
information, other than to the extent that (i) the information becomes publicly
available other than as a result of dis-closure in violation of the provisions
of this Agreement or (ii) such disclosure is required by law, to anyone other
than (I) the Subscriber’s officers, directors, employees, legal counsel,
accountants or authorized agents or advisors who have a need to know such
in-formation in connection with evaluating whether the Subscriber should enter
into this Agreement and acquire the Shares, each of whom have agreed to the
provisions of this Section 7 and (II) other stockholders of the Company and
their representatives who have similarly agreed to the provisions of this
Section 7. The provisions of this Section 7 shall survive the purchase of the
Shares and/or the termination of this Agreement.

 

  -8-

   

 

8. Registration and Trading. Beginning 9 months from the date hereof (the “Reg
Rights Date”), the Company agrees to pay to the Subscriber ½% per month
calculated day-to-day on a 30/360 basis, of the Liquidation Preference of the
Shares held by the Subscriber and acquired pursuant to this Agreement (the
“Monthly Payment”), until the date that both of the following conditions shall
be satisfied: (i) the Company’s common stock is listed for trading on a national
securities exchange, an inter-dealer automated quotation system of a national
association of securities dealers or listed on the OTC Pinks (or its successor
or an equivalent or better regarded marketplace or listing) and (ii) (x) the
common stock issuable upon conversion of the Shares shall be registered under
the Securities Act of 1933, as amended (the “Act”) or (y) the Subscriber is then
able to sell such common stock under Rule 144 promulgated pursuant to the Act
(or the foreign equivalent of these conditions (x) or (y) if the listing in (i)
is on a foreign exchange) without a volume limitation. The Monthly Fee will be
pro-rated if these condi-tions are satisfied with respect to only a portion of
such common stock. The Monthly Payment shall be due and payable at the end of
each month. If at any time during the six-month period commencing upon the day
that both of the above conditions are first satisfied they are no longer
satisfied, then the Company shall again become obligated to make the Monthly
Payment until the above conditions have been satisfied for a period of six
months in aggregate.

 

9. Miscellaneous.

 

(a) This Agreement, including the exhibits hereto, sets forth the entire
understanding of the parties with respect to the subject matter hereof,
super-sedes all existing agreements among them concerning such subject matter,
and may be modified only by a written instrument duly executed by the party to
be charged.

 

(b) Except as otherwise specifically provided herein, any no-tice or other
communication required or permitted to be given hereunder shall be in writ-ing
and shall be mailed by certified mail, return receipt requested, or by Federal
Express, Express Mail or similar overnight delivery or courier service or
delivered (in person or by telecopy, telex or similar telecommunications
equipment) against receipt to the party to whom it is to be given,

 

(i) if to the Company:

 

Gyrotron Technology, Inc.

3412 Progress Drive

Bensalem, Pennsylvania 19020

Attention: Vlad Sklyarevich Fax: (215) 244-4742

Confirm: (215) 244- 4740

 

(ii) if to the Subscriber, 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 ac-cordance with the provisions of this Section 9(b). Any notice
given by means permitted by this Section 9(b) shall be deemed given at the time
of receipt thereof at the address specified in this Section 9(b).

 

  -9-

   

 

(c) This Agreement shall be binding upon and inure to the bene-fit of the
parties hereto, the successors and assigns of the Company, and the permit-ted
successors, assigns, heirs and personal representatives of the Subscriber, not
includ-ing, however, any transferees of the Shares.

 

(d) The headings in this Agreement are solely for convenience of reference and
shall be given no effect in the construction or interpretation of this
Agreement.

 

(e) This Agreement may be executed in any number of counter-parts, each of which
shall be deemed an original, but all of which together shall constitute one and
the same instrument.

 

(f) This Agreement shall be governed by and construed in accor-dance with the
laws of the State of New York, without giving effect to principles governing
conflicts of law that would defer to the substantive law of another
jurisdiction. The parties hereby irrevocably consent to resolve any disputes in
connection with, arising out of, or relating to this agreement by arbitration in
New York City in front of three arbitrators with each party picking one
arbitrator and the two selected arbitrators picking a third. Without limiting
the foregoing, no action or proceeding in connection with, arising out of, or
relating to this agreement shall be brought by the parties hereto in any court
other than the courts of the State of New York or any federal court located in
such State.

 

(g) This Agreement does not create, and shall not be construed as creating, any
rights enforceable by any person not a party to this Agreement (except as
specifically provided in this Agreement).

 

10. Most Favored Nation.

 

 

(a) If prior to the first anniversary of this subscription the Company conducts
and subsequently closes (whether prior to or within 90 days after such
anniversary) a financing (or a series of closely related financings on
substantially like terms) other than a financing or other transaction which is
included within any of the Exempt Issuances as defined below, whose terms were
substantially negotiated prior to such anniversary and that could reasonably be
deemed to have terms and conditions more favorable than the terms provided for
herein, in all such cases with gross cash proceeds in excess of $50,000 (each
such financing a "New Financing"), then the undersigned shall have the right (an
“MFN Right”) to exchange (any such exchange being an "MFN Exchange") all or any
part of the Shares purchased hereunder by the undersigned and still held by the
undersigned valued at $30.00 per unit and any dividends accrued thereon valued
at the accrued amount, for securities offered in the New Financing at the same
price and on the same terms and conditions offered in the New Financing, other
than “MFN Rights” or similar rights, if any, that are part of such New
Financing, which in any case the subscriber will not retain past the first
anniversary of this subscription . The MFN Exchange will, to the extent
possible, be retroactive to the date on which the MFN Right was triggered.

 

 

 

 

 

An “Exempt Issuance” shall mean any of the following transactions: (i) any
shares of common stock to be sold by the Company at a price per share of $0.30
or more, (ii) non-convertible financings , (iii) shares or options representing
up to 1,000,000 of the shares of common stock (as adjusted for stock splits,
combinations and similar events) in the aggregate, to be issued to employees,
directors or service providers that have been approved by the Board, (iv) any
shares or other convertible securities issued in connection with acquisitions,
mergers or other consolidations or issued to a non-financial strategic investor
not affiliated with the Company or any of its affiliates, or (v) any shares or
options issued to a commercial financing source in connection with a financing
provided to the Company which are issued at nominal consideration.

 

  -10-

   

 

(b) The Company covenants and agrees to promptly give written notice (an “MFN
Notice”) to the undersigned of the terms and conditions of any such New
Financing. On or prior to the expiration of the twenty (20) business day period
(the “MFN Review Period”) after the undersigned has received the MFN Notice, the
undersigned shall notify the Company in writing (the "MFN Response") specifying
whether it elects to conduct an MFN Exchange. If the undersigned fails to send
an MFN Response prior to the expiration of the MFN Review Period, the
undersigned shall be deemed to have waived its rights under this Section solely
with respect to the MFN Exchange specified in the MFN Notice relating to such
MFN Review Period.

 

(c) Each potential MFN Exchange shall be communicated to the undersigned in
accordance with this Section until such time as the undersigned elects to
conduct an MFN Exchange. Once the undersigned elects to conduct an MFN Exchange,
the undersigned shall have no further right to receive notice of or to conduct
any future MFN Exchange under this Section. The Company and the undersigned
shall cooperate to promptly cancel the Shares being exchanged and to promptly
enter into such agreements, certificates, instruments and other documents that
are necessary to reflect an MFN Exchange that the undersigned elects to conduct.

 

[Signature page follows]

 

  -11-

   

 

SIGNATURE PAGE

 

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
day and year this subscription has been accepted by the Company as set forth
below.

 

 

Shares Subscribed For:

 

_______________

 

______________________________

Social Security Number or other

Taxpayer Identification Number

 

Print Name of Subscriber

 

____________________________________

 

By:________________________________

  (Signature of Subscriber or

  Authorized Signatory)

 

Address: ___________________________

 

                 ___________________________

 

Telephone: _________________________

 

Fax: _____________________________

 

 

If the Shares will be held as joint tenants, tenants in common, or community
property, please complete the following:

 

 

 

 

 

Print name of spouse or other co-subscriber

 

 

 

 

 

Signature of spouse or other co-subscriber

 

 

 

 

 

Print manner in which Shares and will be held

 

 

If the Subscriber was introduced to the Company by a broker or finder, please
identify such entity: ______________

 

[Please complete Exhibit A for each subscriber.]

 

  -12-

   

 

ACCEPTANCE OF SUBSCRIPTION

 

   

 

 

Name of Subscriber  

 

 

ACCEPTED BY:

 

GYROTRON TECHNOLOGY, INC.

 

      By:

Name:

  Title:        

 

Date: __________, 201_

 

Funds Received: ___________, 201_

 

Accepted for ____________ Shares

 

  -13-

   

 

EXHIBIT A

ACCREDITED INVESTOR STATUS

[IF YOU HAVE CROSSED OUT SECTION 4.1 DO NOT FILL IN]

 

The oversigned subscriber represents that he/it is an Accredited Investor on the
basis that he/it is (check one):

 

_____(i) A bank as defined in Section 3(a)(2) of the Act, or a savings and loan
association or other institution as defined in Section 3(a)(5)(A) of the Act,
whether acting in its individual or fiduciary capacity; a broker or dealer
registered pursuant to Section 15 of the Securities Exchange Act of 1934; an
insurance company as defined in Section 2(13) of the Act; an investment company
registered under the Investment Company Act of 1940 (the “Investment Company
Act”) or a business development company as defined in Section 2(a)(48) of the
Investment Company Act; a Small Business Investment Company li-censed by the
U.S. Small Business Administration under Section 301(c) or (d) of the Small
Business In-vestment Act of 1958; a plan established and maintained by a state,
its political subdivisions or any agency or instrumentality of a state or its
political subdivisions for the benefit of its employees, if such plan has total
assets in excess of $5,000,000; an employee benefit plan within the meaning of
the Employee Retirement Income Security Act of 1974 (“ERISA”), if the investment
decision is made by a plan fiduciary, as defined in Section 3(21) of ERISA,
which is either a bank, savings and loan association, insurance company, or
registered investment advisor, or if the employee benefit plan has total assets
in excess of $5,000,000 or, if a self-directed plan, with investment decisions
made solely by persons that are accredited investors.

 

_____(ii) A private business development company as defined in Section
202(a)(22) of the In-vestment Advisers Act of 1940.

 

_____(iii) An organization described in Section 501(c)(3) of the Internal
Revenue Code, corpo-ration, Massachusetts or similar business trust, or
partnership, not formed for the specific purpose of ac-quiring the securities
offered, with total assets in excess of $5,000,000.

 

_____(iv) A director or executive officer of the Company.

 

_____(v) A natural person whose individual net worth, or joint net worth with
that person’s spouse, at the time of his or her purchase exceeds $1,000,000
excluding his/their principal residence.

 

_____(vi) A natural person who had an individual income in excess of $200,000 in
each of the two most recent years or joint income with that person’s spouse in
excess of $300,000 in each of those years and has a reasonable expectation of
reaching the same income level in the current year.

 

_____(vii) A trust, with total assets in excess of $5,000,000, not formed for
the specific purpose of acquiring the securities offered, whose purchase is
directed by a sophisticated person as described in Rule 506(b)(2)(ii) (i.e., a
person who has such knowledge and experience in financial and business mat-ters
that he is capable of evaluating the merits and risks of the prospective
investment).

 

_____(viii) An entity in which all of the equity owners are accredited
investors. (If this alterna-tive is checked, the Subscriber must identify each
equity owner and provide statements signed by each demonstrating how each is
qualified as an accredited investor. Further, the Subscriber represents that it
has made such investigation as is reasonably necessary in order to verify the
accuracy of this alternative.

 

 

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