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SECURITIES AND EXCHANGE COMMISSION
SCHEDULE 13D
(Rule 13d-101)
INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT
TO RULE 13D-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO
RULE 13D-2(a)
(Amendment No. 1)1
SUNSTAR HEALTHCARE, INC.
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(Name of Issuer)
Common Stock, par value $.001 per share
- --------------------------------------------------------------------------------
(Title of Class of Securities)
867939-10-0
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(CUSIP Number)
Gary J. Simon, Esq.
Parker Chapin Flattau & Klimpl, LLP
1211 Avenue of the Americas
New York, New York 10036
(212) 704-6000
- --------------------------------------------------------------------------------
(Name, Address and Telephone Number of Person Authorized to Receive Notices and
Communications)
January 29, 1999
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(Date of Event Which Requires Filing of This Statement)
If the filing person has previously filed a statement on Schedule 13G
to report the acquisition which is the subject of this Schedule 13D, and is
filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the
following box .
Note: Schedules filed in paper format shall include a signed
original and five copies of the schedule, including all exhibits. See
Rule 13d-7(b) for other parties to whom copies are to be sent.
(Continued on following pages)
- --------
1 The remainder of this cover page shall be filled out for a reporting
person's initial filing on this form with respect to the subject class of
securities, and for any subsequent amendment containing information which
would alter disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
Page 1 of 5 pages
<PAGE>
CUSIP No. 867939-10-0 SCHEDULE 13D Page 2 of 5 Pages
------------------------ ------ -------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Warren D. Stowell
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a)[ ]
(b)[X]
3 SEC USE ONLY
4 SOURCE OF FUNDS*
OO
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) or 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
NUMBER OF 7 SOLE VOTING POWER
SHARES
BENEFICIALLY 255,000
OWNED BY
EACH
REPORTING
PERSON
WITH 8 SHARED VOTING POWER
474,330
9 SOLE DISPOSITIVE POWER
255,000
10 SHARED DISPOSITIVE POWER
474,330
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
729,330
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
[ ]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
23%
14 TYPE OF REPORTING PERSON*
IN
*SEE INSTRUCTIONS BEFORE FILLING OUT!
Page 2 of 5 pages
<PAGE>
CUSIP No. 867939-10-0 Page 3 of 5 Pages
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Item 1. Security and Issuer.
The class of equity securities to which this statement relates consists
of the common stock, par value $.001 per share (the "Common Stock"), of SunStar
Healthcare, Inc., a Delaware corporation (the "Company"). The address of the
Company's principal executive offices is 300 International Drive, Suite 230,
Heathrow, Florida 32746.
Item 2. Identity and Background.
(a) The name of the individual filing this statement is Warren D.
Stowell.
(b) Mr. Stowell's business address is 300 International Drive, Suite
230, Heathrow, Florida 32746.
(c) Mr. Stowell's principal occupation is President, Chief Executive
Officer and Chairman of the Board of the Company.
(d) Mr. Stowell has not, during the last five years, been convicted in
a criminal proceeding (excluding traffic violations or similar misdemeanors).
(e) Mr. Stowell has not, during the last five years, been a party to a
civil proceeding of a judicial or administrative body of competent jurisdiction
as a result of which he was or is subject to a judgment, decree or final order
enjoining future violations of, or prohibiting or mandating activities subject
to, federal or state securities laws or finding any violation with respect to
such laws.
(f) Mr. Stowell is a citizen of the United States.
Item 3. Source and Amount of Funds or Other Consideration.
On January 29, 1999 Mr. Stowell's options to purchase 62,500 shares of
Common Stock vested. Mr. Stowell is currently the direct beneficial owner of
250,000 options, all of which have vested. These options are exercisable at $.25
per share until May 14, 2006.
In addition, Mr. Stowell is the beneficial owner of 474,330 shares of
Common Stock as a result of a voting agreement and irrevocable proxy dated July
16, 1998 among Mr. Stowell, David A. Jesse, Executive Vice President, Chief
Operating Officer and Secretary of the Company, and certain investors in a
private placement of Common Stock of the Company. The voting agreement and
irrevocable proxy will terminate on July 16, 1999.
Page 3 of 5 pages
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CUSIP No. 867939-10-0 Page 4 of 5 Pages
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Item 4. Purpose of Transaction.
Mr. Stowell's options to acquire shares of Common Stock were acquired
in connection with his employment by the Company and are being held as an
investment. Mr. Stowell does not have any present plans or proposals which
relate to or which would result in: (a) the acquisition or disposition by any
person of additional securities of the Company, (b) an extraordinary corporate
transaction, such as a merger, reorganization or liquidation, (c) a sale or
transfer of a material amount of assets of the Company or any of its
subsidiaries, (d) any change, in the present board of directors or management of
the Company, including any plans or proposals to change the number or term of
directors or to fill any existing vacancies on the board, (e) any material
change in the present capitalization or dividend policy of the Company, (f) any
other material change in the Company's business or corporate structure, (g) any
change in the Company's charter, by-laws or instruments corresponding thereto or
other actions which may impede the acquisition of control of the Company by any
person, (h) a class of securities of the Company to be delisted from a national
securities exchange or cease being authorized to be quoted in an inter-dealer
quotation system of a registered national securities association, (i) a class of
equity securities of the Company becoming eligible for termination of
registration pursuant to Section 12(g)(4) of the Securities Exchange Act of 1934
or (j) any action similar to any of those enumerated above.
Item 5. Interest in Securities of the Issuer.
(a) Amount beneficially owned: 729,330 shares of Common Stock,
comprising 23% of the outstanding shares of Common Stock. Includes 250,000
shares of Common Stock, the subject of stock options, of which Mr. Stowell has
the right to acquire immediate beneficial ownership. Also includes 474,300
shares of Common Stock Mr. Stowell beneficially owns as a result of a voting
agreement and irrevocable proxy dated July 16, 1998 among Mr. Stowell, David A.
Jesse, Executive Vice President, Chief Operating Officer and Secretary of the
Company, and certain investors in a private placement of Common Stock of the
Company.
(b) The number of shares of Common Stock with respect to which Mr.
Stowell has sole voting and dispositive power is 255,000, out of which 250,000
are the subject of stock options. Mr. Stowell also has shared voting power with
respect to 474,330 shares of Common Stock.
(c) Pursuant to a voting agreement and irrevocable proxy dated July 16,
1998, Mr. Stowell shares voting power with respect to 474,330 shares of Common
Stock.
(d) Mr. Stowell currently has sole voting power and the right to
receive and the power to direct the receipt of dividends from, and the proceeds
from the sale of, 255,000 shares of Common Stock.
Page 4 of 5 pages
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CUSIP No. 867939-10-0 Page 5 of 5 Pages
---------------- ------ ------
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings or Relationships with
respect to Securities of the Issuer.
Mr. Stowell is party to a voting agreement and irrevocable proxy dated
July 16, 1998 with Mr. David A. Jesse and various investors. Pursuant to the
voting agreement and irrevocable proxy, Mr. Stowell shares with Mr. Jesse the
voting power with respect to 474,330 shares of Common Stock. This voting
agreement will terminate on July 16, 1999.
Item 7. Material to be Filed as Exhibits.
Exhibit A: Form of Subscription Agreement, Stockholder Voting
Agreement and Proxy.
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Dated: February 11, 1999
/s/ Warren D. Stowell
---------------------------
Warren D. Stowell
Page 5 of 5 pages
<PAGE>
EXHIBIT A
---------
Name of Subscriber: ____________________________________
Total Number of Shares of Common Stock: __________________
SUNSTAR HEALTHCARE, INC.
SUBSCRIPTION AGREEMENT, STOCKHOLDER VOTING AGREEMENT AND PROXY
(QUESTIONNAIRE AND INVESTMENT REPRESENTATION)
THE SECURITIES BEING SUBSCRIBED FOR HEREBY
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, OR UNDER APPLICABLE
STATE SECURITIES LAWS DUE TO THE LIMITED
NUMBER OF PERSONS BEING OFFERED TO
AND THE PRIVATE NATURE
OF THE OFFERING.
FURTHER, THE SECURITIES BEING SUBSCRIBED FOR MAY NOT BE
TRANSFERRED EXCEPT PURSUANT TO TRANSACTIONS EXEMPT
FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT OF 1933, AS AMENDED, AND APPLICABLE STATE SECURITIES
LAWS, OR COMPLIANCE
THEREWITH.
1. Instructions. This subscription agreement, stockholder voting
agreement and proxy (questionnaire and investment representation) (this
"Agreement") must be executed and delivered by each prospective investor (the
"Subscriber") in the Common Stock (the "Securities") of SunStar Healthcare,
Inc., a Delaware corporation (the "Company") being offered pursuant to a
Confidential Memorandum dated _____________, 1998 and any amendments or
supplements thereto, including copies of the Company's 1997 annual report filed
on Form 10-KSB and its quarterly report on Form 10-QSB for the period ended
January 31, 1998 (collectively, the "Memorandum"). If your answer to any of the
following questions, representations or warranties is negative or not
applicable, you must indicate such in writing; otherwise, your answer will be
deemed to be in the affirmative or otherwise as indicated.
If the investor is a partnership, it must furnish a copy of its
partnership agreement and such further information as may be required to satisfy
the Company that such partnership is a pre-existing business entity which was
not formed specifically for the purpose of making this investment. If the
investor is a business trust (IRA, Keogh plan trust, qualified pension and/or
profit sharing plan trust, custodial account or other such account) or a
corporation or other legal entity, unless otherwise indicated, all responses are
being made on behalf of each of the principal beneficiaries of the trust and the
shareholders of the corporation. In addition, you must furnish the Company with
a copy of the instrument (including all amendments) creating the entity.
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Your answers will be kept strictly confidential at all times; provided,
however, that the Company may disclose the information provided for the purpose
of proving compliance with any and all applicable laws, including securities and
tax laws.
Any questions regarding this Agreement or your investment should be
directed to Mr. David A. Jesse, Executive Vice President and Chief Operating
Officer, SunStar Healthcare, Inc., 300 International Parkway, Suite 230,
Heathrow, Florida 32746, Telephone: 407-304-1066, Facsimile 407-304-1088.
Prospective Investors should retain their own professional advisors to
review and evaluate the economic, tax and other consequences of an investment in
the Company.
THE SECURITIES OFFERED PURSUANT TO THIS AGREEMENT
(QUESTIONNAIRE AND INVESTMENT REPRESENTATION), AND THE
MEMORANDUM (COLLECTIVELY, THE "OFFERING MATERIALS") HAVE NOT
BEEN FILED OR REGISTERED WITH OR APPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION (THE "COMMISSION"), NOR HAS THE
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THE
OFFERING MATERIALS.
THE SECURITIES OFFERED HEREBY ARE BEING OFFERED PURSUANT TO AN
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT AND APPLICABLE STATE SECURITIES LAWS FOR NON-PUBLIC
OFFERINGS. SUCH EXEMPTIONS LIMIT THE NUMBER AND TYPES OF
INVESTORS TO WHICH THE OFFERING WILL BE MADE AND RESTRICT
SUBSEQUENT TRANSFER OF THE INTERESTS.
THE SECURITIES OFFERED HEREBY SHOULD BE CONSIDERED
ONLY BY PERSONS WHO CAN AFFORD TO SUSTAIN A LOSS OF
THEIR ENTIRE INVESTMENT. INVESTORS WILL BE REQUIRED TO
REPRESENT THAT THEY ARE FAMILIAR WITH AND UNDERSTAND
THE TERMS OF THIS OFFERING.
NO SECURITIES MAY BE RESOLD OR OTHERWISE DISPOSED OF BY AN
INVESTOR UNLESS, IN THE OPINION OF COUNSEL SATISFACTORY TO THE
COMPANY, REGISTRATION UNDER THE APPLICABLE FEDERAL OR STATE
SECURITIES LAWS IS NOT REQUIRED OR COMPLIANCE IS MADE WITH
SUCH REGISTRATION REQUIREMENTS.
THE OFFEREE, BY ACCEPTING DELIVERY OF THE OFFERING MATERIALS,
AGREES TO RETURN THE OFFERING MATERIALS AND ALL ACCOMPANYING
OR RELATED DOCUMENTS TO THE COMPANY UPON REQUEST IF THE
OFFEREE DOES NOT AGREE TO PURCHASE ANY OF THE SECURITIES
OFFERED HEREBY.
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THE OFFERING MATERIALS ARE SUBMITTED IN CONNECTION WITH THE
PRIVATE PLACEMENT OF THE SECURITIES AND DO NOT CONSTITUTE AN
OFFER OR SOLICITATION BY ANYONE IN ANY JURISDICTION IN WHICH
SUCH AN OFFER OR SOLICITATION IS NOT AUTHORIZED. ANY
REPRODUCTION OR DISTRIBUTION OF THE OFFERING MATERIALS IN
WHOLE OR IN PART, OR THE DIVULGENCE OF ANY OF THEIR CONTENTS,
WITHOUT THE PRIOR WRITTEN CONSENT OF THE COMPANY, IS
PROHIBITED. ANY PERSON ACTING CONTRARY TO THE FOREGOING
RESTRICTIONS MAY PLACE HIMSELF AND THE COMPANY IN VIOLATION OF
FEDERAL OR STATE SECURITIES LAWS.
NASAA UNIFORM LEGEND
IN MAKING AN INVESTMENT DECISION INVESTORS MUST RELY ON THEIR
OWN EXAMINATION OF THE PERSON OR ENTITY CREATING THE
SECURITIES AND THE OFFERING AND SALE OF SECURITIES, INCLUDING
THE MERITS AND RISKS INVOLVED. THESE SECURITIES HAVE NOT BEEN
RECOMMENDED BY ANY FEDERAL OR STATE SECURITIES COMMISSION OR
REGULATORY AUTHORITY. FURTHERMORE, THE FOREGOING AUTHORITIES
HAVE NOT CONFIRMED THE ACCURACY OR DETERMINED THE ADEQUACY OF
THIS DOCUMENT. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE. THESE SECURITIES ARE SUBJECT TO RESTRICTIONS
ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR
RESOLD EXCEPT AS PERMITTED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED, AND THE APPLICABLE STATE SECURITIES LAWS, PURSUANT
TO REGISTRATION OR EXEMPTION THEREFROM. INVESTORS SHOULD BE
AWARE THAT THEY WILL BE REQUIRED TO BEAR THE FINANCIAL RISKS
OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME.
2. General Information.
Age: __________________________________________
Residence Address: __________________________________________
Mailing Address: __________________________________________
(if different)
__________________________________________
Telephone: __________________________________________
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Social Security No.: _______________________________________
Occupation: _______________________________________
Business Name and _______________________________________
Address:
_______________________________________
_______________________________________
Business Telephone: _______________________________________
Describe Current Employment or Business Activity:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
How Long:
3. Knowledge and Experience in Business and Financial Affairs.
Have you invested with the Company previously:
Yes No
Have you ever invested in any "restricted" stock or
unmarketable securities previously:
Yes No
If so, please briefly explain the nature of the
investments:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(In lieu of answering the two immediately preceding questions, please attach
such information as you feel is necessary to provide the information requested.)
4. Accredited Investor Status. The Subscriber represents and warrants
that the answers to the following questions are correct (check if applicable).
If none of the following applies to you please leave a blank.
_____(i) I am a natural person whose individual net worth, individually
or together with my spouse, at the time of purchase exceeds
$1,000,000 (at the time of his or her purchase);
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_____(ii) I am a natural person who had an individual income in excess
of $200,000 or a joint income with my spouse in excess of
$300,000 in each of the two most recent years;
_____(iii) I am a broker or dealer registered pursuant to Section 15 of
the Securities Exchange Act of 1934;
_____(iv) I am an employee benefit plan, including an individual
retirement account, within the meaning of Title I of the
Employee Retirement Income Security Act of 1974, and (a)
investment decisions are made by a plan fiduciary, as defined
in section 3(21) of such Act, which is either a bank, savings
and loan association, insurance company, or registered
investment adviser, or (b) such employee benefit plan has
total assets in excess of $5,000,000 or (c) it is a
self-directed plan and investment decisions are made solely by
persons that are accredited investors;
_____(v) I am a private business development company as defined in
section 202(a)(22) of the Investment Advisers Act of 1940;
_____(vi) I am an organization described in Section 501(c)(3) of the
Internal Revenue Code of 1986, a corporation, a Massachusetts
or similar business trust, or a partnership, not formed for
the specific purpose of acquiring the securities offered, with
total assets in excess of $5,000,000;
_____(vii) I am a director or executive officer of Company;
_____(viii) I am 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) under the Act;
_____(ix) I am an entity in which all of the equity owners are
"accredited investors" under Rule 501(a) of the Securities Act
of 1933, as amended;
_____(x) I am 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;
_____(xi) I am a bank as defined in Section 3(a)(2) of the Securities
Act or any savings and loan association or other institution
as defined in Section 3(a)(5)(A) of the Securities Act whether
acting in its individual or fiduciary capacity;
_____(xii) I am an insurance company as defined in Section 2(13) of the
Securities Act;
_____(xiii) I am an investment company registered under the Investment
Company Act of 1940 or a business development company as
defined in Section 2(a)(48) of that Act; or
_____(xiv) I am a small business investment company licensed by the U.S.
Small Business Administration under Section 301(c) or (d) of
the Small Business Investment Act of 1958.
5. Consideration for Purchase. The undersigned (the "Subscriber")
hereby elects to purchase the Common Stock (the "Securities") in the aggregate
principal amount indicated on the initial page hereof.
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6. Understandings of the Subscriber. The Subscriber acknowledges,
understands and agrees that:
(a) The Company reserves the right to reject all or any part
of this subscription in its sole discretion.
(b) This Agreement is and shall be irrevocable, except that
the Subscriber shall have no obligations hereunder in the event that it is for
any reason rejected by the Company.
(c) The Subscriber will be promptly notified by the Company
whether this subscription has been accepted, either in whole or in part, and if
not accepted in whole, agrees to accept the return of a proportionate part of
the funds tendered to the Company as refund or a return, and in either case
without interest or deduction.
(d) The Securities shall not be deemed issued to or owned by
the Subscriber until the Company has executed this Subscription Agreement and
received payment for the shares of Common Stock subscribed for herein (evidenced
by a receipt), such executed agreement and receipt constituting evidence of
Subscriber's ownership interest in the Common Stock.
(e) The Securities have not been registered under the
Securities Act of 1933, as amended, or any applicable state law (collectively,
the "Securities Act"); further, the Securities may not be sold, offered for
sale, transferred, pledged, hypothecated or otherwise disposed of except in
compliance with the Securities Act; further, the legal consequences of the
foregoing mean that the Subscriber must bear the economic risk of the investment
in the Securities for an indefinite period of time; further, if the Subscriber
desires to sell or transfer all or any part of the Securities, the Company may
require the Subscriber's counsel to provide a legal opinion that the transfer
may be made without registration under the Securities Act and applicable state
securities laws; further, other restrictions discussed elsewhere herein may be
applicable; and further, the Subscriber is subject to the restriction on
transfer described herein and the Company will issue stop transfer orders with
the Company's transfer agent to enforce such restrictions.
(f) No federal or state agency has made any findings or
determination as to the fairness of an investment in the Company, or any
recommendation or endorsement of this investment.
7. Representations and Warranties of the Subscriber. The Subscriber
represents and warrants to the Company as follows:
(a) Subscriber's commitment to investments that are not
readily marketable is not disproportionate to Subscriber's net worth, and
Subscriber's investment in the Securities will not cause such overall commitment
to become excessive.
(b) Subscriber has the financial ability to bear the economic
risks of Subscriber's investment in the Securities, has adequate means of
providing for Subscriber's current needs and personal contingencies, and has no
need for liquidity in this investment.
(c) Subscriber has evaluated the high risks of investing in
the Company and has such knowledge and experience in financial and business
matters in general and in particular with respect to this type
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of investment that Subscriber is capable of evaluating the merits and risks of
any investment in the Securities. Subscriber is aware that there is no guarantee
that the Subscriber will realize any gain from this investment, and that the
Subscriber could lose the total amount of the Subscriber's investment in the
Securities.
(d) Subscriber has carefully read the Memorandum for the
Securities and all the exhibits to the Memorandum and has been given the
opportunity to ask questions of and receive answers from the Company concerning
the terms and conditions of this investment, and to obtain additional
information necessary to verify the accuracy of the information Subscriber
desired in order to evaluate Subscriber's investment, and in evaluating the
suitability of this investment Subscriber has not relied upon any
representations or other information (whether oral or written), other than that
furnished to Subscriber by the Company or its representatives.
(e) Subscriber has had the opportunity to discuss with
Subscriber's professional, legal, tax and financial advisors the suitability of
an investment in the Securities for Subscriber's particular tax and financial
situation and all information that Subscriber has provided to the Company
concerning Subscriber and Subscriber's financial position is correct and
complete as of the date set forth below, and if there should be any material
change in such information prior to Subscriber's admission as a shareholder of
the Company, Subscriber will immediately provide such information to the
Company.
(f) The address shown under the Subscriber's signature at the
end of this Subscription Agreement is the Subscriber's principal residence, if
Subscriber is an individual, or its principal business address if a corporation
or other entity.
(g) In making the decision to purchase the Securities,
Subscriber has relied solely upon independent investigations made by Subscriber
or on Subscriber's behalf.
(h) Subscriber is acquiring the Securities for Subscriber's
own personal account, for investment purposes only, and is not purchasing with a
view to, or for, the resale, distribution, subdivision or fractionalization
thereof, and shall not make any sales, or pledge or other transfer thereof
without registration under the Securities Act and any applicable securities laws
of any state unless an exemption from registration is available under those
laws.
(i) Subscriber is an accredited investor as that term is
defined in Section 501(a) under Regulation D promulgated by the Securities and
Exchange Commission under the Securities Act. Subscriber is financially able to
bear the economic risk of this investment, including the ability to afford
holding the Securities for an indefinite period of time.
(j) FOR PARTNERSHIPS, CORPORATIONS, TRUSTS, OR OTHER ENTITIES
ONLY: If the Subscriber is a partnership, corporation, trust or other entity,
(i) the Subscriber represents and warrants that it was not organized or
reorganized for the specific purpose of acquiring the Securities, (ii) the
person on behalf of Subscriber executing this Agreement has the full power and
authority to execute this Agreement on behalf of such entity and to make the
representations and warranties made herein on its behalf, and (iii) this
investment has been affirmatively authorized, if required, by the governing
board of such entity and is not prohibited by the governing documents of the
entity.
(k) The Subscriber understands that the purchase of the
Securities is a highly speculative investment and involves a high degree of
risk, including but not limited to the risk of economic loss from
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operations of the Company and risks described under the heading "Risk Factors"
in the Memorandum that the Company may need additional financing in the future,
and that the Company makes no assurance whatever concerning the present or
prospective value of the Debentures.
The foregoing representations, warranties, agreements, undertakings and
acknowledgments are made by Subscriber with the intent that they be relied upon
in determining Subscriber's suitability as a purchaser of the Securities. In
addition, Subscriber agrees to notify the Company immediately of any change in
any representation, warranty or other information. If more than one person is
signing this Agreement, each representation, warranty and undertaking herein
shall be a joint and several representation, warranty and undertaking of each
such person.
8. Indemnity by Subscriber. The Subscriber understands and acknowledges
that the Company and its officers and directors are relying upon the
representations, warranties and agreements made by the Subscriber to and with
the Company herein and, thus, hereby agrees to indemnify the Company, its
officers and directors, agents, attorneys, and employees, and agrees to hold
each of them harmless from and against any and all loss, damage, liability, or
expense, including reasonable attorneys' fees, that it or any of them may
suffer, sustain, or incur by reason of or in connection with any
misrepresentation or breach of warranty or agreement made by the Subscriber
under this Agreement, or in connection with the sale or distribution of the
Securities by the Subscriber in violation of the Securities Act or any other
applicable law.
9. Miscellaneous Provisions.
(a) No Assignment. The Subscriber agrees that the Subscriber
may not transfer, assign, cancel, terminate or revoke this Agreement or any
agreement of the Subscriber made hereunder (except as otherwise specifically
provided herein).
(b) Further Assurances. At any time and from time to time
after the date of this Agreement, each party shall execute such additional
instruments and take such other and further actions as may be reasonably
requested by any other party to confirm or perfect title to any property
transferred hereunder or otherwise to carry out the intent and purpose of this
Agreement. In addition, in the event the Company or its executive officers
request additional representations by Subscriber, or documentation of the
representations herein set forth, in order better to evaluate Subscriber's
suitability for investment in the Company, the Subscriber will promptly furnish
such additional representations or documentation or, in the alternative, if the
Subscriber considers such additional request to be unreasonable, the Subscriber
will request that his, her or its subscription for the Securities be withdrawn.
(c) Waiver. Any failure on the part of any party hereunder to
comply with any of their obligations, agreements or conditions hereunder may be
waived in writing by the party to whom such compliance is owed; however, waiver
on one occasion does not operate to effectuate a waiver on any other occasion.
(d) Headings. The article and paragraph headings in this
Agreement are inserted for convenience only and shall not affect in any way the
meaning or interpretation of this Agreement.
(e) Governing Law. THIS AGREEMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF
NEW YORK WITHOUT GIVING EFFECT TO THE CONFLICT OF LAWS PROVISIONS THEREOF.
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(f) No Oral Modification. This Agreement may be amended solely
in writing, and only after the mutual agreement of the parties affected thereby.
(g) Survival of Representations, Warranties and Covenants. The
representations, warranties, covenants and agreements contained herein shall
survive the sale of the Securities pursuant to this Agreement.
(h) Entire Agreement: Binding Agreement. The parties have not
made any representations and warranties with respect to the subject matter
hereof not set forth herein and this Agreement contains the entire agreement
between the parties with respect to the transactions contemplated hereunder. The
terms and conditions of this Agreement shall inure to the benefit of and be
binding upon the parties and, as applicable, their respective heirs, personal
representatives, successors and permitted assigns.
(i) Representation of the Company. The Company has delivered
to the Holder, or has otherwise confirmed delivery to the Holder, of the
Company's Memorandum, including all supplements and Exhibits thereto, in
connection with the sale of the Securities. To the best of the Company's
knowledge, the Memorandum does not, at the date thereof, and as amended or
supplemented through the closing date will not at the closing date, contain any
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary in order to make the statements therein in light
of circumstances under which they were made not misleading.
(j) Stockholder Voting Agreement and Proxy.
(i) For a period of 12 months from the date of
the closing of this offering, the Subscriber agrees to vote or cause to be voted
all of the Securities acquired hereby according to the direction of either
Warren E. Stowell or David A. Jesse, officers and directors of the Company, with
respect to any proposal(s) upon which the stockholders of the Company may vote,
including, but not limited to, the issuance of additional securities of the
Company in order to raise or secure additional equity investment in or debt
financing for the Company.
(ii) For a period of 12 months from the date of
the closing of this offering, this executed Agreement shall constitute an
irrevocable proxy coupled with an interest pursuant to the stockholders voting
agreement set forth above in subsection (j)(i) above. During such period, either
Warren E. Stowell or David A. Jesse shall have the right to vote or execute a
written consent on behalf of the Securities acquired by the Subscriber pursuant
to the terms and conditions of this Agreement as Warren E. Stowell or David A.
Jesse, in their sole and exclusive discretion, choose. The Subscriber shall
execute any additional proxy documents and take any further action either Warren
E. Stowell or David A. Jesse may reasonably request to carry out the purposes of
the stockholders voting agreement set forth above.
(k) Registration Rights Agreement. The Subscriber has executed
and delivered to the Company, simultaneously herewith, a registration rights
agreement substantially in the same form as attached to the Memorandum as
Exhibit C.
D-9
<PAGE>
ALL SUBSCRIBERS MUST COMPLETE THIS PAGE
/S
(Number of Shares/Purchase Price of the shares of Common Stock Subscribed For)
Make checks payable to: SunStar Healthcare, Inc.
Manner in which Title is to be held (Please Check One):
1. [] Individual 6. [] IRA of _______________________
2. [] Joint Tenants With 7. [] Trust/Estate/Pension or
Right of Survivorship Profit Sharing Plan
Date Opened: _________________
3. [] Community Property 8. [] As a Custodian for
______________________________
Under the Uniform Gift to
Minors Act of the State of
______________________________
4. [] Tenants in Common 9. [] Married with Separate Property
5. [] Corporation Partnership 10. [] Keogh of ______________________
CERTIFICATION: Under penalties of perjury, I certify that the number shown below
is my valid tax identification number and that I am not subject to backup
withholding either because I have not been notified that I am subject to backup
withholding as a result of a failure to report all interest or dividends or the
Internal Revenue Service has notified me that I am no longer subject to backup
withholding. Taxpayer Identification Number: ___________________.
IN WITNESS WHEREOF, the undersigned has executed this Agreement on this
____ day of __________________, 1998.
Signature of Subscriber
D-10
<PAGE>
EXECUTION BY SUBSCRIBER WHO IS A NATURAL PERSON
________________________________________________________________________________
Exact Name in Which Title is to be Held
________________________________________________________________________________
(Signature)
________________________________________________________________________________
Name (Please Print)
________________________________________________________________________________
Residence Address: Number and Street
________________________________________________________________________________
City State Zip Code
________________________________________________________________________________
Social Security Number
Accepted this day of , 1998, on behalf of SunStar Healthcare, Inc.
SUNSTAR HEALTHCARE, INC.
By: ______________________
Name:______________________
Title:_____________________
D-11
<PAGE>
EXECUTION BY SUBSCRIBER WHICH IS AN ENTITY
(Corporation, Partnership, Trust, Etc.)
- ----------------------------------
Name of Entity (Please Print)
By: ________________________
Title: ______________________
Attest:______________________
Title: ______________________
_____________________________
Address
______________________________
Taxpayer Identification Number
Accepted this day of , 1998, on behalf of SunStar Healthcare, Inc.
SUNSTAR HEALTHCARE, INC.
By: _______________________
Name:______________________
Title: ___________________
D-12
