EXHIBIT 99(ii)
November _____, 2002
Hydron Technologies, Inc.
0000 Xxxx Xxxxxx Xxxx
Xxxxxxxx 0, Xxxxx 0X
Xxxxxxx Xxxxx XX 00000
Attn: Xx. Xxxxxxx X. Xxxxx
Chief Financial Officer
Re: Subscription Agreement and Investment Letter
--------------------------------------------
Gentlemen:
The undersigned (the "Subscriber") hereby subscribes to purchase the
number of Units (each a "Unit" and collectively, the "Units") set forth on the
signature page of this Subscription Agreement comprised of (i) one (1) Share
(each a "Share" and collectively the "Shares") of Common Stock, $.01 par value
per share, of Hydron Technologies, Inc. (the "Company") and (ii) an Option to
purchase one (1) share of Common Stock (each an "Option" and collectively, the
"Options") at any time or from time to time exercisable in whole or in part for
a three (3) year period ending on the third anniversary of the date of this
letter agreement at an exercise price of $0.20 per share, at the purchase price
of $0.20 per Unit as follows:
1. The aggregate purchase price for the Units subscribed as set forth
on the signature page is hereby tendered herewith; by delivery of a
check payable to Hydron Technologies, Inc. or by confirmation of a wire
transfer to the Company of immediately available funds through the
United States Federal Reserve System.
2. PRIVATE PLACEMENT. THE OFFER AND SALE OF THE UNITS, COMPRISED OF
THE SHARES, THE OPTIONS AND THE SHARES OF COMMON STOCK ISSUABLE UPON
EXERCISE OF THE OPTIONS (THE "SECURITIES"), HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT, OR ANY STATE SECURITIES OR "BLUE SKY" LAWS
(COLLECTIVELY "SECURITIES LAWS"), AND THE SECURITIES ARE BEING OFFERED
AND SOLD IN RELIANCE ON EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS
OF THE SECURITIES LAWS. THE SECURITIES HAVE NOT BEEN 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 THE
OFFER AND SALE OF THE SECURITIES OR THE ACCURACY OR ADEQUACY OF ANY
INFORMATION PROVIDED TO THE SUBSCRIBER. ANY REPRESENTATION TO THE
CONTRARY IS UNLAWFUL.
THE SUBSCRIBER RECOGNIZES AND ACKNOWLEDGES THAT THE RELIANCE BY THE
COMPANY AND ITS OFFICERS AND DIRECTORS UPON SUCH EXEMPTIONS FROM
REGISTRATION ARE, IN PART, BASED UPON THE ACCURACY OF THE
REPRESENTATIONS AND AGREEMENTS OF THE SUBSCRIBER SET FORTH IN THIS
SUBSCRIPTION AGREEMENT.
3. Representations and Warranties of the Undersigned. The undersigned
acknowledges, represents and warrants to, and agrees with, the Company
as follows:
a. The undersigned has adequate means of providing for
current needs and possible contingencies, and anticipates
no need now or in the foreseeable future to sell the
Securities;
b. The undersigned has such knowledge and experience in
financial and business matters that makes the undersigned
capable of evaluating the merits and risks of investment
in the Company and of making an informed investment
decision;
c. The undersigned is aware that no federal or state agency
has passed upon the Units or any of the Securities or made
any finding or determination concerning the fairness of
this investment;
d. The undersigned has had an opportunity to ask questions of
and receive answers from representatives of the Company,
concerning the terms and conditions of this investment,
and all such questions have been answered to the full
satisfaction of the undersigned. Such representatives have
not, however, rendered any investment advice to the
undersigned with respect to the suitability of an
investment in the Units;
e. The Units for which the undersigned hereby subscribes, the
Shares, the Options, and the Shares of Common Stock for
which such Options may be exercised will be acquired for
the undersigned's own account, for investment only and not
with a view toward resale or distribution in a manner
which would require registration under the Securities Act
of 1933, as amended;
f. The undersigned has been made aware by the Company that
investment in the Units involves a high degree of risk and
the possible loss of the total amount invested;
g. The undersigned acknowledges that neither the Company nor
any representative of the Company has made any
representations or warranties in respect of the Company's
business or profitability;
h. The undersigned, if a corporation, partnership, trust or
other form of business entity is authorized and otherwise
duly qualified to purchase and hold the subscribed for
Units. Such entity has its principal place of business as
set forth on the signature page hereof and if such entity
has been formed for the specific purpose of acquiring the
Units subscribed to hereunder, it hereby agrees to supply
any additional written information that may be required by
the Company;
i. All of the information that the undersigned has furnished
in this Subscription Agreement and in the reports of the
Company filed with the Securities and exchange Commission
pursuant to Section 13(a) of the Securities Exchange Act
of 1934, as amended, including without limitation, the
Company's annual report on Form 10-K for the year ended
December 31, 2001 and its quarterly report on Form 10Q for
the period ended September 30, 2002 (the "SEC Reports"),
including without limitation, those with respect to the
undersigned's financial position and business status is
correct and complete as of the date of this Subscription
Agreement. In the event that there is a material change in
such information prior to the time Units are sold to the
Subscriber pursuant to this Subscription Agreement, the
undersigned will immediately furnish the revised or
corrected information to the Company;
j. The Subscriber understands that the Company has no
obligation to register the Securities, except as expressly
hereinafter set forth, and the Company may not be able to
effect such registration;
k. The Subscriber acknowledges that he has had the
opportunity to ask questions of, and receive answers from,
the Company concerning the business and financial
condition of the Company; and the opportunity to review
the Company's Annual Report on Form 10-K for Fiscal Year
ended December 31, 2001 together with all other reports
filed by the Company pursuant to Section 13 of the
Securities Exchange Act of 1934 subsequent to the filing
of such Form 10-K through the date of the execution and
delivery of this agreement;
l. No warranties or representations have been made to the
Subscriber by any officer, director, employee or agent of
the Company, except as expressly set forth herein;
m. The Subscriber has evaluated the risks of purchasing the
Units; determined that the purchase of the Shares is a
suitable investment; has adequate financial resources for
an investment of such character; the Subscriber alone or
with its representative, has such knowledge and experience
in financial and business matters that the Subscriber is
capable of evaluating the merits and risks of the purchase
of the Units; and
n. The warranties and representations made herein by the
Subscriber are accurate, true and correct, and may be
relied upon by the Company in connection with the issuance
of the Units hereunder to the Subscriber.
4. Registration Rights. The Company hereby grants to the Subscriber
the following registration rights:
a. The Company hereby grants to the Subscriber the right,
exercisable at any time and from time to time during the
term of this Agreement, if it proposes to file a
registration statement with respect to any class of
security under the Securities Act of 1933, as amended (the
"Act"), to include in such registration statements, any or
all of the Shares or the Shares of Common Stock issuable
upon exercise of the options (the "Registrable
Securities");
b. The Company shall bear any and all expenses of the
registrations referred to above, including, but not
limited to, legal, accounting and printing fees;
providing, however, that the Company shall not be
obligated to pay any fees and disbursements of counsel for
holder of Registrable Securities, any underwriters'
discount or commission in respect of such Registrable
Securities, payment of which shall, in each case, be the
sole responsibility of the Subscriber; and
c. The registration rights granted hereby are not applicable
to a registration statement filed by the Company under the
Act on Form S-4 or S-8 or any successor forms.
5. Limitation on Transfer of Shares. THERE ARE SUBSTANTIAL
RESTRICTIONS ON THE TRANSFERABILITY OF THE SHARES OF COMMON STOCK AND
THE SUBSCRIBER MAY BE REQUIRED TO BEAR THE FINANCIAL RISKS OF THE
INVESTMENT FOR AN INDEFINITE PERIOD OF TIME. The undersigned
acknowledges that the shares of Units to be acquired pursuant to this
Subscription Agreement and the shares of Common Stock to be issued upon
conversion of such shares may not be sold unless such sale is exempt
from registration under the Securities Act. The undersigned further
agrees to be responsible for compliance with all conditions on transfer
imposed by any applicable State Blue Sky or securities law. Each stock
certificate representing shares of Units or shares of Common Stock to
be received upon conversion shall bear a legend in the form of Annex A
hereto stating that such shares are subject ------- to restrictions on
transfer pursuant to applicable federal and state securities law.
6. Indemnification. The undersigned understands the meaning and legal
consequences of the representations and warranties in this Subscription
Agreement, and hereby agrees to indemnify and hold harmless the
Company, its officers, directors, attorneys and agents, from and
against any and all loss, damage or liability due to or arising out of
a breach of any such representations or warranties;
7. Miscellaneous.
a. This Agreement constitutes the entire agreement and
understanding of the parties hereto and no amendment,
modification of waiver of any provision herein shall be
effective unless in writing, executed by the party charged
therewith.
b. This Agreement shall be construed, interpreted and
enforced in accordance with and shall be governed by the
laws of the State of New York without regard to the
principles of conflicts of laws.
c. No party has incurred, nor will incur any liability for
brokerage fees or commissions in connection with the
transactions contemplated hereby, and all parties warrant
that no third party was instrumental in consummating this
transaction so as to earn any such fee.
d. Any notice or other communication under the provisions of
this Agreement shall be in writing, and shall be given by
postage prepaid, registered or certified mail, return
receipt requested, by hand delivery with an
acknowledgement copy requested, or by the Express Mail
service offered by the United States Post Office, directed
to the addresses set forth herein, or to any new address
of which any party hereto shall have informed the others
by the giving of notice in the manner provided herein.
Such notice or communications shall be effective, if sent
by mail, three (3) days after it is mailed within the
continental United States; if sent by Express Mail
Service, one (1) day after it is mailed; or by hand
delivery, upon receipt.
IN WITNESS WHEREOF, the undersigned has executed this Subscription
Agreement for the following number of Units:
Number of Units subscribed for:
__________________
Total purchase price (number of shares x $0.20):
$_________________
_____________________________________________
(Signature of Subscriber)
_____________________________________________
(Please print name, if signing for
corporation or other entity, please
also print title of signature and name of entity)
_____________________________________________
(Social Security or Tax Identification
Number, if applicable)
Execution Date:________________________, 2002
Mailing address of Subscriber (please print):
_____________________________________________
_____________________________________________
_____________________________________________
(City) (State) (Zip Code)
_____________________________________________
(Telephone Number)
Accepted: If less than the entire subscription is accepted:
Number of Units accepted:
__________________
Total purchase price (number of Units x $0.20)
$_________________
HYDRON TECHNOLOGIES, INC.
By:__________________________________________
Name: Xxxxxxx X. Xxxxx
Title: Chief Financial Officer
ANNEX A
RESTRICTIVE STOCK LEGEND
The number of units (each a "Unit" and collectively, the "Units") set
forth on the signature page of this Subscription Agreement comprised of (i) one
(1) Shares of the Common Stock, $0.01 par value per share ("Common Stock") of
Hydron Technologies, Inc., a Florida corporation (the "Corporation"), and (ii)
an option to purchase one (1) share of Common Stock (each and "Option" and
collectively, the "Options") at any time or from time to time exercisable in
whole or in part for a three (3) year period ending on the third anniversary of
the date of this letter agreement at an exercise price of $0.20 per share, are
subject to certain restrictions on transfer under federal and applicable state
securities law. Certificates evidencing Shares and shares of Common Stock to be
issued upon exercise of the Options shall both bear the following restrictive
legends with respect to such restrictions:
"These securities have not been registered under the
Securities Act of 1933, as amended (the "Act"), or applicable
state securities laws. They may not be sold, offered for sale,
pledged or hypothecated in the absence of a registration in
effect with respect to the securities under the Act and
registration or qualification under applicable state
securities laws or, if reasonably requested by the
Corporation, an opinion of counsel satisfactory to the
Corporation that such registration or qualification is not
required."
