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EXHIBIT 10.1
SUBSCRIPTION AGREEMENT
This Subscription Agreement pertains to the offering by
Environmental
Tectonics Corporation (the "COMPANY") of 373,831 shares of the
Company's common
stock, par value $.05 per share (the "SHARES"), at a purchase
price of $5.35 per
share for an aggregate offering of $1,999,995.85. The Company is
making this
offering solely to an accredited investor (as defined under Rule
501(a) of
Regulation D promulgated under the Securities Act of 1933, as
amended (the
"SECURITIES ACT")).
The undersigned, intending to be legally bound, hereby offers
to
purchase from the Company 373,831 Shares for an aggregate
purchase price of
$1,999,995.85.
The Company will be deemed to have accepted this offer upon
execution
by it of the Receipt and Acceptance attached to this
Subscription Agreement.
This subscription is submitted to the Company subject to its
acceptance and in
accordance with, and subject to the terms and conditions
described in, this
Subscription Agreement.
1. Verification of Investor Suitability under Regulation D.
The
undersigned understands that in order to subscribe for the
Shares in this
Offering, the undersigned must be an "accredited investor" as
defined in Section
501 of Regulation D under the Securities Act.
2. Amount and Method of Payment. The purchase price for the
Shares is
$1,999,995.85 and shall be paid by tender of a check made
payable to the Company
or wire transfer of immediately available funds to the account
set forth on the
last page hereof in the amount of $1,999,995.85 (the "PURCHASE
PRICE").
3. Acceptance of Subscription.
(a) The undersigned understands and agrees that the Company, in
its
sole discretion, reserves the right to accept or reject this or
any other
subscription for Shares in whole or in part at any time prior to
the Closing (as
defined below).
(b) In the event that this subscription is rejected in whole or
in
part, the Company shall promptly return all or the applicable
portion of the
Purchase Price to the undersigned, as the case may be, and this
Subscription
Agreement shall thereafter have no force or effect except with
respect to the
portion, if any, of this subscription that is accepted by the
Company.
4. (a) Restrictions on Resale or Transfer. The Shares have not
been
registered under the Securities Act or any state securities
laws, and may not be
sold or transferred unless (i) such sale or transfer is
subsequently registered
thereunder; (ii) the undersigned shall have delivered to the
Company an opinion
of counsel (which opinion and counsel shall be reasonably
acceptable to the
Company) to the effect that the securities to be sold or
transferred may be sold
or transferred pursuant to an exemption from such registration;
or (iii) the
securities are sold pursuant to Rule 144 promulgated under the
Securities Act
(or a successor rule).
(b) The certificate(s) representing the Shares shall bear a
restrictive legend in substantially the following form (and a
stop-transfer
order may be placed against transfer of the certificates for
such securities):
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"The securities represented by this certificate have not
been
registered under the Securities Act of 1933, as amended (the
"SECURITIES ACT"), or applicable state securities laws, and may
not
be offered for sale, sold, transferred or assigned in the
absence of
an effective registration statement for the securities under
the
Securities Act, or an opinion of counsel, in form, substance
and
scope reasonably acceptable to the Company, that registration is
not
required under the Securities Act or unless sold pursuant to
Rule
144 under the Securities Act."
5. Delivery of the Stock Certificate, Listing of Shares on
American
Stock Exchange. The Company will execute and deliver
certificate(s) representing
the Shares to the subscriber within five (5) business days after
acceptance of
the subscription and receipt of the Purchase Price. The Company
shall secure the
listing of the Shares in accordance with the Listing Standards,
Policies and
Requirements of the American Stock Exchange within thirty (30)
business days
after acceptance of the subscription and receipt of the Purchase
Price.
6. Representations and Warranties. The undersigned hereby
acknowledges,
represents and warrants to, and agrees with, the Company as
follows:
(a) The undersigned understands that the offering and sale of
the
Shares by the Company to the undersigned is intended to be
exempt from
registration under the Securities Act by virtue of Section 4(2)
of the
Securities Act and the provisions of Rule 506 of Regulation D
promulgated
thereunder and, in accordance therewith and in furtherance
thereof, the
undersigned represents and warrants to and agrees with the
Company as follows:
(i) The undersigned has carefully reviewed this Subscription
Agreement and the Disclosure Materials set forth at EXHIBIT
"A"
hereto, and understands the information contained in each
such
document;
(ii) All documents, records and books pertaining to the
Company and/or this investment that the undersigned has
requested
have been made available for inspection by him and/or his
attorney,
accountant and other advisor(s);
(iii) The undersigned and/or his advisor(s) have had a
reasonable opportunity to ask questions of and receive
information
and answers from a person or persons acting on behalf of the
Company
concerning the offering of the Shares and all such questions
have
been answered and all such information has been provided to the
full
satisfaction of the undersigned;
(iv) The undersigned acknowledges that all current and
periodic reports which the Company has filed with the Securities
and
Exchange Commission as of the date of this Subscription
Agreement
are available for review through the EDGAR filing system which
is
accessible at the Securities and Exchange Commission's website
at
www.sec.gov. All current and periodic reports filed with the
Securities and Exchange Commission since January 1, 2004 are
included in the Disclosure Materials at EXHIBIT "A" hereto;
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(v) Neither the undersigned nor the undersigned's investment
advisors, if any, have been furnished any offering literature
other
than the Disclosure Materials attached as EXHIBIT "A" hereto and
the
undersigned and the undersigned's advisors, if any, have relied
only
on the information contained in such Disclosure Materials and
the
information, as described in subparagraphs (ii) and (iii)
above,
furnished or made available to them by the Company;
(vi) No oral or written representations have been made and
no
oral or written information has been furnished to the
undersigned or
his advisor(s) in connection herewith that were in any way
inconsistent with the information set forth in this
Subscription
Agreement;
(vii) The undersigned is not subscribing for the Shares as a
result of or subsequent to any advertisement, article, notice
or
other communication published in any newspaper, magazine or
similar
media or broadcast over television or radio, or presented at
any
seminar or meeting;
(viii) The undersigned acknowledges that he has conducted
his
own independent evaluation of the Company and has analyzed the
risks
associated with an investment in the Shares and has based
his
decision to invest in the Shares on the results of this
evaluation
and analysis;
(ix) The undersigned's overall commitment to investments
that
are not readily marketable is not disproportionate to the
undersigned's net worth and the undersigned's investment in
the
Company will not cause such overall commitment to become
disproportionate to the undersigned's net worth;
(x) If the undersigned is a natural person, the undersigned
has reached the age of majority in the jurisdiction in which
the
undersigned resides, has adequate net worth and means of
providing
for the undersigned's current financial needs and personal
contingencies, is able to bear the substantial economic risks of
an
investment in the Shares for an indefinite period of time, has
no
need for liquidity in such investment and, at the present
time,
could afford a complete loss of such investment;
(xi) The address set forth below is the undersigned's true
and
correct residence (or, if not an individual, domiciliary)
address;
(xii) The undersigned (A) has such knowledge of, and
experience in, business and financial matters so as to enable
him to
utilize the information made available to him in connection with
the
offering of the Shares in order to evaluate the merits and risks
of
an investment in the Shares and to make an informed
investment
decision with respect thereto, (B) the undersigned has
carefully
evaluated the risks of investing and (C) has the capacity,
either
alone, or with a professional advisor, to protect his own
interests
in connection with a pu
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