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SUBSCRIPTION AGREEMENT
Quantum Fuel Systems Technologies Worldwide,
Inc.
17872 Cartwright Road
Irvine, CA 92614
Gentlemen:
The undersigned (the " Investor ") hereby
confirms its agreement with you as follows:
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- This Subscription Agreement, including the Terms and Conditions
For Purchase of Units attached hereto as Annex I
(collectively, this " Agreement ") is made as of the date
set forth below between Quantum Fuel Systems Technologies
Worldwide, Inc., a Delaware corporation (the " Company "),
and the Investor.
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- The Company has authorized the sale and issuance to certain
investors of up to an aggregate of 9,000,000 units (the "
Units "), each consisting of (i) one share (the "
Share ," collectively, the " Shares ") of its common
stock, par value $0.001 per share (the " Common Stock "),
and (ii) one warrant (the " Warrant " and, together, the "
Warrants ") to purchase 1.5 shares of Common Stock (and the
fractional amount being the " Warrant Ratio "), in
substantially the form attached hereto as Exhibit B ,
subject to adjustment by the Company's Board of Directors, or a
committee thereof, for a purchase price of $2.12 per Unit (the "
Purchase Price "). The Shares issuable upon exercise of the
Warrants are referred to herein as the " Warrant Shares "
and, together with the Units, the Shares and the Warrants, are
referred to herein as the " Securities ".
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- The offering and sale of the Units (the " Offering ")
are being made pursuant to (1) an effective Registration Statement
on Form S-3, File No. 333-152133 (including the Prospectus
contained therein (the " Base Prospectus "), the "
Registration Statement "), filed by the Company with the
Securities and Exchange Commission (the " Commission "), (2)
if applicable, certain "free writing prospectuses" (as that term is
defined in Rule 405 under the Securities Act of 1933, as amended
(the " 1933 Act ")), that have been or will be filed with
the Commission and delivered to the Investor on or prior to the
date hereof and (3) a Prospectus Supplement (the " Prospectus
Supplement " and together with the Base Prospectus, the "
Prospectus ") containing certain supplemental information
regarding the Units and terms of the Offering that will be filed
with the Commission and delivered to the Investor (or made
available to the Investor by the filing by the Company of an
electronic version thereof with the Commission), along with the
Company's counterpart to this Agreement and (iv) if the Company has
filed an abbreviated registration statement to register additional
securities pursuant to Rule 462(b) (the " 462(b) Registration
Statement "), then any reference herein to the Registration
Statements shall also be deemed to include such 462(b) Registration
Statement.
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- The Company and the Investor agree that the Investor will
purchase from the Company and the Company will issue and sell to
the Investor the Units set forth below for the aggregate purchase
price set forth below. The Units shall be purchased pursuant to the
Terms and Conditions for Purchase of Units attached hereto as
Annex I and incorporated herein by this reference as if
fully set forth herein. The Investor acknowledges that the Offering
is not being underwritten by the placement agent (the "
Placement Agent ") named in the Prospectus Supplement and
that there is no minimum offering amount.
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- The manner of settlement of the Shares included in the Units
purchased by the Investor shall be as follows:
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Delivery versus payment (" DVP ") through
the Depository Trust Company (" DTC ") ( i.e. , at
closing, the Company shall issue Shares registered in the
Investor's name and address as set forth below and released by
American Stock Transfer & Trust Company (the " Transfer
Agent ") directly to the account(s) at Merriman Curhan Ford
& Co. (" MCF ") identified by the Investor; upon receipt
of such Shares, MCF shall promptly electronically deliver such
shares to the Investor, and simultaneously therewith payment shall
be made by MCF by wire transfer to the Company) NO LATER THAN
ONE (1) BUSINESS DAY AFTER THE EXECUTION OF THIS AGREEMENT BY THE
INVESTOR AND THE COMPANY, THE INVESTOR SHALL:
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(I) notify MCF of the account or accounts AT MCF
to be credited with the Shares being purchased by such Investor,
AND
(II) confirm that the account or accounts at
MCF to be credited with the SECURITIES being purchased by the
Investor have a minimum balance equal to the aggregate purchase
price for the UNITS being purchased by the Investor.
It is the investor's responsibility to (A)
make the necessary wire transfer or confirm the proper account
balance in a timely manner and (B) arrange for settlement by way of
DVP in a timely manner. If the Investor does not deliver the
aggregate purchase price for the UNITs or does not make proper
arrangements for settlement in a timely manner, the UNITs may not
be delivered at Closing to the Investor or the Investor may be
excluded from the offering altogether .
6. The Investor represents that, except as set
forth below, (a) it has had no position, office or other material
relationship within the past three years with the Company or
persons known to it to be affiliates of the Company, (b) it is not
a FINRA member or an Associated Person (as such term is defined
under the FINRA Membership and Registration Rules Section 1011) as
of the Closing, and (c) neither the Investor nor any group of
Investors (as identified in a public filing made with the
Commission) of which the Investor is a part in connection with the
Offering, acquired, or obtained the right to acquire, 20% or more
of the Common Stock (or securities convertible into or exercisable
for Common Stock) or the voting power of the Company on a
post-transaction basis. Exceptions:
(If no exceptions, write "none." If left blank,
response will be deemed to be "none.")
7. The executed Warrant shall be
delivered in accordance with the terms thereof.
8 . The Investor represents that it has
received (or otherwise had made available to it by the filing by
the Company of an electronic version thereof with the Commission)
the Base Prospectus, dated July 14, 2008, which is a part of the
Company's Registration Statement, the documents incorporated by
reference therein and any free writing prospectus (collectively,
the " Disclosure Package "), prior to or in connection with
the receipt of this Agreement. The Investor acknowledges that,
prior to the delivery of this Agreement to the Company, the
Investor will receive certain additional information regarding the
Offering, including pricing information (the " Offering
Information "). Such information may be provided to the
Investor by any means permitted under the 1933 Act, including the
Prospectus Supplement, a free writing prospectus and oral
communications.
9. No offer by the Investor to buy the
Units will be accepted and no part of the Purchase Price will be
delivered to the Company until the Investor has received the
Offering Information and the Company has accepted such offer by
countersigning a copy of this Agreement, and any such offer may be
withdrawn or revoked, without obligation or commitment of any kind,
at any time prior to the Company (or MCF on behalf of the Company)
sending (orally, in writing or by electronic mail) notice of its
acceptance of such offer. An indication of interest will involve no
obligation or commitment of any kind until the Investor has been
delivered the Offering Information and this Agreement is accepted
and countersigned by or on behalf of the Company.
Number of Shares: _____________
Number of Warrants:
Purchase Price Per Unit: $
Aggregate Purchase Price: $
Please confirm that the foregoing correctly sets forth the
agreement between us by signing in the space provided below for
that purpose.
Agreed and Accepted
this ___ day of August, 2008:
QUANTUM FUEL SYSTEMS TECHNOLOGIES WORLDWIDE, INC.
By:
Title:
ANNEX I
TERMS AND CONDITIONS FOR PURCHASE OF UNITS
1. Authorization and Sale of the Units. Subject
to the terms and conditions of this Agreement, the Company has
authorized the sale of the Units.
2. Agreement to Sell and Purchase the Units;
Placement Agent.
2.1 At the Closing (as defined in Section
3.1 ), the Company will sell to the Investor, and the Investor
will purchase from the Company, upon the terms and conditions set
forth herein, the respective number of Units set forth on the last
page of the Agreement to which these Terms and Conditions for
Purchase of Units are attached as Annex I (the "
Signature Page ") for the aggregate purchase price therefor
set forth on the Signature Page.
2.2 Investor acknowledges that the
Company has agreed to pay Merriman Curhan Ford & Co. (the "
Placement Agent " or " MCF ") a fee (the "
Placement Fee ") in respect of the sale of Units to the
Investor.
2.3 The Company has entered into a
Placement Agent Agreement, dated the date hereof (the "
Placement Agreement "), with the Placement Agent that
contains certain representations, warranties, covenants and
agreements of the Company that may be relied upon by the Investor,
which shall be a third party beneficiary thereof. The Company
confirms that neither it nor any other Person acting on its behalf
has provided the Investor with any information that constitutes or
could reasonably be expected to constitute material, nonpublic
information, except as will be disclosed in the Prospectus and the
Company's Form 8-K filed with the Commission in connection with the
Offering. The Company understands and confirms that the Investor
will rely on the foregoing representations in effecting
transactions in securities of the Company.
3. Closings and Delivery of the Shares,
Warrants and Funds.
3.1 Closing . The completion of
the purchase and sale of the Units (the " Closing ") shall
occur at a place and time (the " Closing Date ") to be
specified by the Company and the Placement Agent, and of which the
Investor will be notified in advance by the Placement Agent, in
accordance with Rule 15c6-1 promulgated under the Securities
Exchange Act of 1934, as amended (the " Exchange Act "). At
the Closing, (a) the Company shall cause the Transfer Agent to
deliver to the Investor the number of Shares set forth on the
Signature Page registered in the name of the Investor or, if so
indicated on the Investor Questionnaire attached hereto as
Exhibit A , in the name of a nominee designated by the
Investor, (b) the Company shall cause to be delivered to the
Investor (i) a Warrant to purchase a number of whole Warrant Shares
determined by multiplying the number of Shares (and Units) set
forth on the signature page by the Warrant Ratio, and rounding down
to the nearest whole number in the form of Exhibit B hereto,
and (b) the aggregate purchase price for the Units being purchased
by the Investor will be delivered by or on behalf of the Investor
to the Company.
3.2 Conditions to the Company's
Obligations . (a) The Company's obligation to issue and
sell the Units to the Investor shall be subject to: (i) the receipt
by the Company of the purchase price for the Units being purchased
hereunder as set forth on the Signature Page and (ii) the accuracy
of the representations and warranties made by the Investor and the
fulfillment of those undertakings of the Investor to be fulfilled
prior to the Closing Date.
(b) Conditions to the Investor's
Obligations . The Investor's obligation to purchase the
Units will be subject to the condition that the Placement Agent
shall not have: (a) terminated the Placement Agreement pursuant to
the terms thereof or (b) determined that the conditions to the
closing in the Placement Agreement have not been satisfied.
3.3 Delivery of Funds.
Delivery Versus Payment through The
Depository Trust Company . The Investor has elected to settle
the Shares purchased by such Investor by delivery versus payment
through DTC; no later than one (1) business day after the
execution of this Agreement by the Investor and the Company
, the Investor shall confirm that the account or accounts at MCF to
be credited with the Shares being purchased by the Investor have a
minimum balance equal to the aggregate purchase price for the Units
being purchased by the Investor.
3.4 Delivery of Shares and Warrants.
Delivery Versus Payment through The
Depository Trust Company . The Investor has elected to settle
the Shares purchased by such Investor by delivery versus payment
through DTC; no later than one (1) business day after the
execution of this Agreement by the Investor and the Company
, the Investor shall notify MCF of the account or accounts at MCF
to be credited with the Shares being purchased by such Investor. On
the Closing Date, the Company shall deliver the Shares to the
Investor through DTC directly to the account(s) at MCF identified
by Investor and simultaneously therewith payment shall be made by
MCF by wire transfer to the Company. In addition, on the closing
Date, the Company shall deliver or cause to be delivered by
overnight courier the Warrant purchased by such Investor.
4. Representations, Warranties and Covenants
of the Investor.
The Investor acknowledges, represents and warrants to, and
agrees with, the Company and the Placement Agent that:
4.1 The Investor (a) is knowledgeable,
sophisticated and experienced in making, and is qualified to make
decisions with respect to, investments in shares presenting an
investment decision like that involved in the purchase of the
Units, including investments in securities issued by the Company
and investments in comparable companies, (b) has answered all
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