POLYMET MINING CORP.
PRIVATE PLACEMENT SUBSCRIPTION AGREEMENT
INSTRUCTIONS TO PURCHASER
1. | All purchasers complete all the information in the boxes on page and sign where indicated with an “X”. |
2. | If you are a resident in a jurisdiction outside of Canada or the United States of America specifically the United Kingdom or Europe), then complete the “Accredited Investor Questionnaire (British Columbia)” that starts on page . The purpose of the questionnaire is to determine whether you meet the standards for participation in a private placement under Multilateral Instrument 45-103 adopted by the British Columbia Securities Commission. |
3. | If you are a portfolio manager or you are not an individual (that is, the Purchaser is a corporation, partnership, trust or entity other than an individual), then complete and sign the “Corporate Placee Registration Form” (Form 4C) that starts on page . |
4. | On or before the end of the fifth business day before the Closing Date as defined under the Terms, the Purchaser will deliver to the Issuer the Subscription Agreement and all applicable schedules and required forms, duly executed, and payment in full for the total price of the Purchased Securities to be purchased by the Purchaser, by wire transfer, certified funds or bank drafts as follows: |
(i) | Cheques and bank drafts to be made payable to: PolyMet Mining Corp. |
(ii) | Wire transfers to be forwarded to: |
Account name: | Polymet Mining Corp. |
Bank: | Royal Bank of Canada |
6400 No. 3 Road, | |
Richmond, B.C., | |
V6Y 2C2 | |
Transit #: | 4800 |
Account#: | 1039577 |
Swift Code: | ROYCCAT 2 |
ABA#: | 021 0000021 |
ALL SUBSCRIPTION AGREEMENTS, APPLICABLE, SCHEDULES, REQUIRED FORMS AND PAYMENTS TO BE FORWARDED TO: |
POLYMET MINING CORP.
520 - 700 WEST PENDER STREET
VANCOUVER, BRITISH COLUMBIA, CANADA V6C 1G8
This is page of pages of a subscription agreement and related appendixes, schedules and forms. Collectively, these pages together are referred to as the “Subscription Agreement”.
UNIT NON-BROKERED PRIVATE PLACEMENT SUBSCRIPTION AGREEMENT
TO: PolyMet Mining Corp. (the “Issuer”), of Suite 520 - 700 West Pender Street, Vancouver, British Columbia, V6C 1G8
Subject and pursuant to the terms set out in the Terms on pages to , the General Provisions on pages to and the other schedules and appendixes attached which are hereby incorporated by reference, the Purchaser hereby irrevocably subscribes for, and on Closing will purchase from the Issuer, the following securities at the following price:
______________________Units |
$0.55 per Unit for a total purchase price of $_________________________________ |
The Purchaser owns, directly or indirectly, the following securities of the Issuer: ____________________________________ |
[Check if applicable] The Purchaser is o an insider of the Issuer |
The Purchaser directs the Issuer to issue, register and deliver the certificates representing the Purchased Securities as follows:
REGISTRATION INSTRUCTIONS | DELIVERY INSTRUCTIONS | |
Name to appear on certificate | Name and account reference, if applicable | |
Account reference if applicable | Contact name | |
Address | Address | |
Telephone Number |
EXECUTED by the Purchaser this _______ day of _____________, 2005. By executing this Subscription Agreement, the Purchaser certifies that the Purchaser and any beneficial purchaser for whom the Purchaser is acting is resident in the jurisdiction shown as the “Address of Purchaser”. Unless the jurisdiction shown as the “Address of Purchaser” is British Columbia, then the Purchaser certifies that the Purchaser is NOT resident in British Columbia.
WITNESS: | EXECUTION BY PURCHASER: | |
X | ||
Signature of Witness | Signature of individual (if Purchaser is an individual) | |
X | ||
Name of Witness | Authorized signatory (if Purchaser is not an individual) | |
Address of Witness | Name of Purchaser (please print) | |
Name of authorized signatory (please print) | ||
Accepted this _____ day of ____________, 2005 | ||
POLYMET MINING CORP.. | Address of Purchaser (residence) | |
Per: | ||
Telephone Number | ||
Authorized signatory | ||
E-mail address |
By signing this acceptance, the Issuer agrees to be bound by the Terms on pages to , the General Provisions on pages to , and the other schedules and appendixes incorporated by reference.
Subscription Agreement (with related appendixes, schedules and forms) | Page 2 of 15 pages |
TERMS
Reference date of this Subscription Agreement | February·, 2005 (the “Agreement Date”) |
The Offering
The Issuer | POLYMET MINING CORP. (the “Issuer”) |
Offering | The offering consists of up to an aggregate of 9,000,000 units of the Issuer (the “Units”). |
Purchased Securities | The “Purchased Securities” are Units. Each Unit consists of one previously unissued common share, as presently constituted (a “Share”) and one-half of one non-transferable share purchase warrant (a “Warrant”) of the Issuer. One whole Warrant will entitle the holder, on exercise, to purchase one additional common share of the Issuer (a “Warrant Share”) at a price of $0.70 per Warrant Share at any time until the close of business on the day which is 24 months from the date of Closing, provided that if the closing price of the Issuer’s shares as traded on the Exchange is over $1.00 per share for 30 consecutive days, the Warrants will terminate 30 days thereafter. |
Total amount | Up to $4,950,000 |
Price | $0.55 per Unit |
Warrants | The Warrants will be issued and registered in the name of the purchasers. The Warrants will be non-transferable and are subject to a four-month hold period. See “Resale Restrictions and Legends.” The certificates representing the Warrants will, among other things, include provisions for the appropriate adjustment in the class, number and price of the Warrant Shares issued upon exercise of the Warrants upon the occurrence of certain events, including any subdivision, consolidation or reclassification of the Issuer’s common shares, the payment of stock dividends and the amalgamation of the Issuer. The issue of the Warrants will not restrict or prevent the Issuer from obtaining any other financing, or from issuing additional securities or rights, during the period within which the Warrants may be exercised. |
Use of Proceeds | The proceeds of the placement will be utilized for a winter drill program, engagement of contracts for the environmental impact statement, commencement of process testwork and process engineering matters for a Definitive Feasibility Study on the NorthMet Project and to provide working capital. |
Selling Jurisdictions | The Units may be sold in certain jurisdictions outside Canada as solely determined by the Company in accordance with available exemptions (the “Selling Jurisdictions”). |
Page 3 of 15 pages |
Exemptions | The offering will be made in accordance with the following exemptions from the prospectus requirements: (a) the British Columbia “accredited investor” exemption (section 5.1 of Multilateral Instrument 45-103) |
Resale restrictions and legends | Pursuant to Multilateral Instrument 45-102, the Purchased Securities will be subject to a four month hold period that starts to run on Closing. The Purchaser acknowledges that the certificates representing the Purchased Securities will bear the following legends: “Unless permitted under securities legislation, the holder of the securities shall not trade the securities before [date that is four months and a day after the Closing.]” “Without prior written approval of the TSX Venture Exchange and compliance with all applicable securities legislation, the securities represented by this certificate may not be sold, transferred, hypothecated or otherwise traded on or through the facilities of the TSX Venture Exchange or otherwise in Canada or to or for the benefit of a Canadian resident until [date that is four months and a day after the Closing].” Purchasers are advised to consult with their own legal counsel or advisors to determine the resale restrictions that may be applicable to them. |
Closing Date | Payment for, and delivery of, the Units is scheduled to occur 48 hours after TSX Venture Exchange acceptance of the placement for filing (the “Closing Date”). |
Additional definitions | In the Subscription Agreement, the following words have the following meanings unless otherwise indicated: (a) “Purchased Securities” means the Units purchased under this Subscription Agreement; (b) “Securities” means the Shares, the Warrants and the Warrant Shares; (c) “Warrants” includes the certificates representing the Warrants. |
The Issuer
Jurisdiction of organization | The Issuer is incorporated under the laws of British Columbia. |
Stock exchange listings | Shares of the Issuer are listed on the TSX Venture Exchange (the “Exchange”). |
Page 4 of 15 pages |
“Securities Legislation Applicable to the Issuer” | The “Securities Legislation Applicable to the Issuer” is the Securities Act (British Columbia), the Securities Act (Alberta) the Securities Act Ontario. The “Commissions with Jurisdiction over the Issuer” are the British Columbia Securities Commission, the Alberta Securities Commission and the Ontario Securities Commission. |
Accredited Investor Questionnaire (British Columbia)
(Capitalized terms not specifically defined in this Questionnaire have the meaning ascribed to them in the Subscription Agreement to which this Questionnaire is attached.)
In connection with the execution of the Subscription Agreement to which this Questionnaire is attached, the undersigned (the “Purchaser”) represents and warrants to the Issuer that the Purchaser satisfies one or more of the categories indicated below (please place an “X” on the appropriate lines):
____ Category 1 | a Canadian financial institution, or an authorized foreign bank listed in Schedule III of the Bank Act (Canada) |
____ Category 2 | the Business Development Bank of Canada incorporated under the Business Development Bank of Canada Act (Canada) |
____ Category 3 | an association under the Cooperative Credit Associations Act (Canada) located in Canada or a central cooperative credit society for which an order has been made under subsection 473(1) of that Act |
____ Category 4 | a subsidiary of any person or company referred to in Categories 1 to 3, if the person or company owns all of the voting securities of the subsidiary, except the voting securities required by law to be owned by directors of that subsidiary |
____ Category 5 | a person or company registered under the securities legislation of a jurisdiction of Canada, as an adviser or dealer, other than a limited market dealer registered under the Securities Act (Ontario) or the Securities Act (Newfoundland and Labrador) |
____ Category 6 | an individual registered or formerly registered under the securities legislation of a jurisdiction of Canada, as a representative of a person or company referred to in Category 5 |
____ Category 7 | the government of Canada or a jurisdiction of Canada, or any crown corporation, agency or wholly owned entity of the government of Canada or a jurisdiction of Canada |
____ Category 8 | a municipality, public board or commission in Canada |
____ Category 9 | any national, federal, state, provincial, territorial or municipal government of or in any foreign jurisdiction, or any agency of that government |
____ Category 10 | a pension fund that is regulated by either the Office of the Superintendent of Financial Institutions (Canada) or a pension commission or similar regulatory authority of a jurisdiction of Canada |
____ Category 11 | an individual who, either alone or with a spouse, beneficially owns, directly or indirectly, financial assets having an aggregate realizable value that before taxes, but net of any related liabilities, exceeds $1,000,000 |
____ Category 12 | an individual whose net income before taxes exceeded $200,000 in each of the two most recent years or whose net income before taxes combined with that of a spouse exceeded $300,000 in each of the two most recent years and who, in either case, reasonably expects to exceed that net income level in the current year |
Subscription Agreement (with related appendixes, schedules and forms) | Page 6 of 15 pages |
____ Category 13 | a person or company, other than a mutual fund or non-redeemable investment fund, that, either alone or with a spouse, has net assets of at least $5,000,000, and unless the person or company is an individual, that amount is shown on its most recently prepared financial statements |
____ Category 14 | a mutual fund or non-redeemable investment fund that, in the local jurisdiction, distributes its securities only to persons or companies that are accredited investors |
____ Category 15 | a mutual fund or non-redeemable investment fund that, in the local jurisdiction, is distributing or has distributed its securities under one or more prospectuses for which the regulator has issued receipts |
____ Category 16 | a trust company or trust corporation registered or authorized to carry on business under the Trust and Loan Companies Act (Canada) or under comparable legislation in a jurisdiction of Canada or a foreign jurisdiction, trading as a trustee or agent on behalf of a fully managed account |
____ Category 17 | a person or company trading as agent on behalf of a fully managed account if that person or company is registered or authorized to carry on business under the securities legislation of a jurisdiction of Canada or a foreign jurisdiction as a portfolio manager or under an equivalent category of adviser or is exempt from registration as a portfolio manager or the equivalent category of adviser |
____ Category 18 | a registered charity under the Income Tax Act (Canada) that, in regard to the trade, has obtained advice from an eligibility adviser or other adviser registered to provide advice on the securities being traded |
____ Category 19 | an entity organized in a foreign jurisdiction that is analogous to any of the entities referred to in Categories 1 through 5 and Category 10 in form and function, or |
____ Category 20 | a person or company in respect of which all of the owners of interests, direct or indirect, legal or beneficial, except the voting securities required by law to be owned by directors, are persons or companies that are accredited investors |
The statements made in this Questionnaire are true and accurate to the best of my information and belief and the Purchaser will promptly notify the Issuer of any changes in the answers.
Dated _______________ 2005.
X | ||
Signature of individual (if Purchaser is an individual) | ||
X | ||
Authorized signatory (if Purchaser is not an individual) | ||
Name of Purchaser (please print) | ||
Name of authorized signatory (please print) | ||
Official capacity of authorized signatory (please print) |
For the purposes hereof:
(a) | "financial assets " means cash and securities; |
(b) | "related liabilities" means: |
(i) | liabilities incurred or assumed for the purpose of financing the acquisition or ownership of financial assets; or |
(ii) | liabilities that are secured by financial assets; |
(c) | “eligibility adviser” means an investment dealer or equivalent category of registration, registered under the securities legislation of a jurisdiction of a purchaser and authorized to give advice with respect to the type of security being distributed. |
Subscription Agreement (with related appendixes, schedules and forms) | Page 7 of 15 pages |
FORM 4C
CORPORATE PLACEE REGISTRATION FORM
Where subscribers to a Private Placement are not individuals, the following information about the placee must be provided. This Form will remain on file with the Exchange. The corporation, trust, portfolio manager or other entity (the “Placee”) need only file it on one time basis, and it will be referenced for all subsequent Private Placements in which it participates. If any of the information provided in this Form changes, the Placee must notify the Exchange prior to participating in further placements with Exchange listed companies. If as a result of the Private Placement, the Placee becomes an Insider of the Issuer, Insiders of the Placee are reminded that they must file a Personal Information Form (2A) or, if applicable, Declarations, with the Exchange.
1. | Placee Information: |
(a) | Name: ________________________________________________________________________ |
(b) | Complete Address:_______________________________________________________________ |
(c) | Jurisdiction of Incorporation or Creation: ______________________________________________ |
2. | Portfolio Manager |
(a) | Is the Placee purchasing securities as a portfolio manager (Yes/No)? _________________________ |
(b) | Is the Placee carrying on business as a portfolio manager outside of Canada (Yes/No)? ___________ |
3. | If the answer to 2(b) above was “Yes”, the undersigned certifies that: |
(a) | It is purchasing securities of an Issuer on behalf of managed accounts for which it is making the investment decision to purchase the securities and has full discretion to purchase or sell securities for such accounts without requiring the client’s express consent to a transaction; |
(b) | it carries on the business of managing the investment portfolios of clients through discretionary authority granted by those clients (a “portfolio manager” business) in ____________________ [jurisdiction], and it is permitted by law to carry on a portfolio manager business in that jurisdiction; |
(c) | it was not created solely or primarily for the purpose of purchasing securities of the Issuer; |
(d) | the total asset value of the investment portfolios it manages on behalf of clients is not less than $20,000,000; and |
(e) | it has no reasonable grounds to believe, that any of the directors, senior officers and other insiders of the Issuer, and the persons that carry on investor relations activities for the Issuer has a beneficial interest in any of the managed accounts for which it is purchasing |
4. | If the answer to 2(a). above was “No”, please provide the names and addresses of control persons of the Placee: |
Name | City | Province or State | Country |
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The undersigned acknowledges that it is bound by the provisions of applicable Securities Law, including provisions concerning the filing of insider reports and reports of acquisitions (See for example, sections 87 and 111 of the Securities Act (British Columbia) and sections 176 and 182 of the Securities Act (Alberta).
Acknowledgement - Personal Information
“Personal Information” means information about an identifiable individual, and includes information contained in sections 1, 2 and 4, as applicable, of this Form.
The undersigned hereby acknowledges and agrees that it has obtained the express written consent of each individual to:
(a) | the disclosure of Personal Information by the undersigned to the Exchange (as defined in Appendix 6B) pursuant to this Form; and |
(b) | the collection, use and disclosure of Personal Information by the Exchange for the purposes described in Appendix 6B or as otherwise identified by the Exchange, from time to time. |
Dated at ____________________________________ on _______________________, 2005.
X | ||
Signature of individual (if Purchaser is an individual) | ||
X | ||
Authorized signatory (if Purchaser is not an individual) | ||
Name of Purchaser (please print) | ||
Name of authorized signatory (please print) | ||
Official capacity of authorized signatory (please print) |
THIS IS NOT A PUBLIC DOCUMENT
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Provisions applicable to a purchaser resident in the United Kingdom
IMPORTANT NOTE: the following provisions are applicable ONLY if the Purchaser is resident in the United Kingdom.
Additional representations
IN ADDITION to the representations and warranties in the General Provisions (on pages to ), the Purchaser acknowledges, represents, warrants and covenants to and with the Issuer that, as at the Agreement Date and at the Closing:
(a) | the Purchaser is acquiring the Purchased Securities for its own account for investment purpose only and not with a view to resale; and |
(b) | the Purchaser is an authorized or exempted person within the meaning of the Financial Services Act 1986, or a local authority or a body corporate which has, or whose holding company has, a called up share capital or net assets of not less than £5 million or satisfies one or more of the other requirements of article 9(3) of the Financial Services Act 1986 (Investment Advertisements) (Exemptions) Order 1988 (as amended). |
Subscription Agreement (with related appendixes, schedules and forms) | Page 10 of 15 pages |
GENERAL PROVISIONS
1. DEFINITIONS
1.1 In the Subscription Agreement (including the first (cover) page, the Terms on pages to , the General Provisions on pages to and the other schedules and appendixes incorporated by reference), the following words have the following meanings unless otherwise indicated:
(a) | “Applicable Legislation” means the Securities Legislation Applicable to the Issuer (as defined on page ) and all legislation incorporated in the definition of this term in other parts of the Subscription Agreement, together with the regulations and rules made and promulgated under that legislation and all administrative policy statements, blanket orders and rulings, notices and other administrative directions issued by the Commissions; |
(b) | “Closing” means the completion of the sale and purchase of the Purchased Securities; |
(c) | “Closing Date” has the meaning assigned in the Terms; |
(d) | “Commissions” means the Commissions with Jurisdiction over the Issuer (as defined on page ) and the securities commissions incorporated in the definition of this term in other parts of the Subscription Agreement; |
(e) | “Exchange” has the meaning assigned in the Terms; |
(f) | “Final Closing” means the last closing under the Private Placement; |
(g) | “General Provisions” means those portions of the Subscription Agreement headed “General Provisions” and contained on pages to , |
(h) | “Private Placement” means the offering of the Purchased Securities on the terms and conditions of the Agency Agreement and this Subscription Agreement; |
(i) | “Purchased Securities” has the meaning assigned in the Terms; |
(j) | “Regulatory Authorities” means the Commissions and the Exchange; |
(k) | “Securities” has the meaning assigned in the Terms; |
(l) | “Subscription Agreement” means the first (cover) page, the Terms on pages to , the General Provisions to , and the other schedules and appendixes incorporated by reference; and |
(m) | “Terms” means those portions of the Subscription Agreement headed “Terms” and contained on pages to . |
1.2 In the Subscription Agreement, unless otherwise specified, all references to dollar amounts are to Canadian dollars.
1.3 In the Subscription Agreement, other words and phrases that are capitalized have the meaning assigned in the Subscription Agreement.
2. REPRESENTATIONS AND WARRANTIES OF PURCHASER
2.1 Acknowledgements concerning offering
The Purchaser acknowledges that:
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(a) | no securities commission or similar regulatory authority has reviewed or passed on the merits of the Securities; |
(b) | there is no government or other insurance covering the Securities; |
(c) | there are risks associated with the purchase of the Securities; |
(d) | there are restrictions on the Purchaser’s ability to resell the Securities and it is the responsibility of the Purchaser to find out what those restrictions are and to comply with them before selling the Securities; |
(e) | the Issuer has advised the Purchaser that the Issuer is relying on an exemption from the requirements to provide the Purchaser with a prospectus and to sell securities through a person registered to sell securities under the Applicable Legislation and, as a consequence of acquiring securities pursuant to this exemption, certain protections, rights and remedies provided by the Applicable Legislation, including statutory rights of rescission or damages, will not be available to the Purchaser; |
(f) | no prospectus has been filed by the Issuer with the Commissions in connection with the issuance of the Purchased Securities, the issuance is exempted from the prospectus and registration requirements of the Applicable Legislation and: |
(i) | the Purchaser is restricted from using most of the civil remedies available under the Applicable Legislation; |
(ii) | the Purchaser may not receive information that would otherwise be required to be provided to the Purchaser under the Applicable Legislation; and |
(iii) | the Issuer is relieved from certain obligations that would otherwise apply under the Applicable Legislation; |
2.2 Representations by all purchasers
The Purchaser represents and warrants to the Issuer that, as at the Agreement Date and at the Closing:
(a) | to the best of the Purchaser’s knowledge, the Securities were not advertised; |
(b) | no person has made to the Purchaser any written or oral representations: |
(i) | that any person will resell or repurchase the Securities; |
(ii) | that any person will refund the purchase price of the Purchased Securities; |
(iii) | as to the future price or value of any of the Securities; or |
(iv) | that any of the Securities will be listed and posted for trading on a stock exchange or that application has been made to list and post any of the Securities for trading on any stock exchange other than the Shares and Warrant Shares on the Exchange; |
(c) | the Purchaser is at arm’s length (as that term is customarily defined) with the Issuer; |
(d) | the Purchaser (or others for whom it is contracting hereunder) has been advised to consult its own legal and tax advisors with respect to applicable resale restrictions and tax considerations, and it (or others for whom it is contracting hereunder) is solely responsible for compliance with applicable resale restrictions and applicable tax legislation; |
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(e) | the Purchaser has no knowledge of a “material fact” or “material change” (as those terms are defined in the Applicable Legislation) in the affairs of the Issuer that has not been generally disclosed to the public, except knowledge of this particular transaction; |
(f) | the offer made by this subscription is irrevocable (subject to the Purchaser’s right to withdraw the subscription and to terminate the obligations as set out in this Subscription Agreement) and requires acceptance by the Issuer and approval of the Exchange; |
(g) | the Purchaser has the legal capacity and competence to enter into and execute this Subscription Agreement and to take all actions required pursuant to the Subscription Agreement and, if the Purchaser is a corporation, it is duly incorporated and validly subsisting under the laws of its jurisdiction of incorporation and all necessary approvals by its directors, shareholders and others have been given to authorize execution of this Subscription Agreement on behalf of the Purchaser; |
(h) | the entering into of this Subscription Agreement and the transactions contemplated hereby will not result in the violation of any of the terms and provisions of any law applicable to, or the constating documents of, the Purchaser or of any agreement, written or oral, to which the Purchaser may be a party or by which the Purchaser is or may be bound; |
(i) | this Subscription Agreement has been duly executed and delivered by the Purchaser and constitutes a legal, valid and binding agreement of the Purchaser enforceable against the Purchaser; |
(j) | the Purchaser has been independently advised as to the applicable hold period imposed in respect of the Securities by securities legislation in the jurisdiction in which the Purchaser resides and confirms that no representation has been made respecting the applicable hold periods for the Securities and is aware of the risks and other characteristics of the Securities and of the fact that the Purchaser may not be able to resell the Securities except in accordance with the applicable securities legislation and regulatory policies; |
(k) | the Purchaser is capable of assessing the proposed investment as a result of the Purchaser’s financial and business experience or as a result of advice received from a registered person other than the Issuer or any affiliates of the Issuer; |
(l) | if required by applicable securities legislation, policy or order or by any securities commission, stock exchange or other regulatory authority, the Purchaser will execute, deliver, file and otherwise assist the Issuer in filing, such reports, undertakings and other documents with respect to the issue of the Securities as may be required; and |
(m) | the Purchaser acknowledges that certain persons may receive a commission from the Issuer in connection with this Private Placement. |
(n) | the Purchaser is not a “control person” of the Issuer as defined in the Applicable Legislation, will not become a “control person” by virtue of this purchase of any of the Securities, and does not intend to act in concert with any other person to form a control group of the Issuer; |
(o) | the offer was not made to the Purchaser when he was in the United States and at the time the Purchaser’s buy order was made, the Purchaser was outside the United States; |
(p) | the Purchaser is not a U.S. Person; |
(q) | the Purchaser is not and will not be purchasing Units for the account or benefit of any U.S. Person. |
2.3 Reliance, indemnity and notification of changes
The representations and warranties in the Subscription Agreement (including the first (cover) page, the Terms on pages to , the General Provisions on pages to , and the other schedules and appendixes incorporated by reference) are made by the Purchaser with the intent that they be relied upon by the Issuer in determining its suitability as a purchaser of Purchased Securities, and the Purchaser hereby agrees to indemnify the Issuer against all losses, claims, costs, expenses and damages or liabilities which any of them may suffer or incur as a result of reliance thereon. The Purchaser undertakes to notify the Issuer immediately of any change in any representation, warranty or other information relating to the Purchaser set forth in the Subscription Agreement (including the first (cover) page, the Terms on pages to , the General Provisions on pages to , and the other schedules and appendixes incorporated by reference) which takes place prior to the Closing.
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2.4 Survival of representations and warranties
The representations and warranties contained in this Section will survive the Closing.
3. REPRESENTATIONS AND WARRANTIES OF THE ISSUER
3.1 The Issuer warrants and represents that:
(a) | the Issuer and its material subsidiaries, if any, are valid and subsisting corporations duly incorporated and in good standing under the laws of the jurisdictions in which they are incorporated, continued or amalgamated; |
(b) | the Issuer and its material subsidiaries, if any, are duly registered and licensed to carry on business or own property in the jurisdictions in which they carry on business or own property where so required by the laws of that jurisdiction; |
(c) | the Issuer is authorized to issue 1,000,000,000 common shares of which 55,313,653 were issued as fully paid and non-assessable as of November 23, 2004; |
(d) | the Issuer will reserve or set aside sufficient common shares in its treasury to issue the Shares, and Warrant Shares, |
(e) | the issue and sale of the Securities by the Issuer does not and will not conflict with, and does not and will not result in a breach of, any of the terms of its incorporating documents or any agreement or instrument to which the Issuer is a party; |
(f) | neither the Issuer or its subsidiaries, if any, is a party to any actions, suits or proceedings which could materially affect its business or financial condition, and no such actions, suits or proceedings are contemplated or have been threatened; |
(g) | there are no judgments against the Issuer or any of its subsidiaries, if any, which are unsatisfied, nor are there any consent decrees or injunctions to which the Issuer or any of its subsidiaries, if any, is subject; |
(h) | this Agreement has been duly authorized by all necessary corporate action on the part of the Issuer |
(i) | the common shares of the Issuer are listed for trading on the Exchange and no order ceasing, halting or suspending trading in securities of the Issuer or prohibiting the sale of such securities has been issued to and is outstanding against the Issuer or its directors, officers or promoters or against any other companies that have common directors, officers or promoters and no investigations or proceedings for such purposes are pending or threatened; |
4. CLOSING
4.1 The Purchaser acknowledges that, although Purchased Securities may be issued to other purchasers under the Private Placement concurrently with the Closing, there may be other sales of Purchased Securities under the Private Placement, some or all of which may close before or after the Closing. The Purchaser further acknowledges that there is a risk that insufficient funds may be raised on the Closing to fund the Issuer’s objectives, and that further closings may not take place after the Closing.
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4.2 On or before the end of the fifth business day before the Closing Date, the Purchaser will deliver to the Issuer the Subscription Agreement and all applicable schedules and required forms, duly executed, and payment in full for the total price of the Purchased Securities to be purchased by the Purchaser, by wire transfer, certified funds or bank drafts.
4.3 The Purchaser’s obligation to complete the purchase and sale of the Purchased Securities shall be subject to the following conditions:
(a) | the representations and warranties made by the Issuer in this Subscription Agreement shall be true and correct as of the Closing Date (except for representations and warranties that speak as of a specific date) and the covenants of the Issuer shall have been performed, satisfied and complied with, where applicable, on or before the Closing Date; |
(b) | the Issuer shall have delivered to the Purchaser, or to the direction of the Purchaser, the following items: |
(i) | a copy of this Subscription Agreement duly executed by the Issuer. |
5. MISCELLANEOUS
5.1 The Purchaser agrees to sell, assign or transfer the Securities only in accordance with the requirements of applicable securities laws and any legends placed on the Securities as contemplated by the Subscription Agreement.
5.2 The Purchaser hereby authorizes the Issuer to correct any errors in, or complete any minor information missing from any part of the Subscription Agreement and any other schedules, forms, certificates or documents executed by the Purchaser and delivered to the Issuer in connection with the Private Placement.
5.3 The Issuer may rely on delivery by fax machine of an executed copy of this subscription, and acceptance by the Issuer of such faxed copy will be equally effective to create a valid and binding agreement between the Purchaser and the Issuer in accordance with the terms of the Subscription Agreement.
5.4 Without limitation, this subscription and the transactions contemplated by this Subscription Agreement are conditional upon and subject to the Issuer’s having obtained such regulatory approval of this subscription and the transactions contemplated by this Subscription Agreement as the Issuer considers necessary.
5.5 This Subscription Agreement is not assignable or transferable by the parties hereto without the express written consent of the other party to this Subscription Agreement.
5.6 Time is of the essence of this Subscription Agreement and will be calculated in accordance with the provisions of the Interpretation Act (British Columbia).
5.7 Except as expressly provided in this Subscription Agreement and in the agreements, instruments and other documents contemplated or provided for in this Subscription Agreement, this Subscription Agreement contains the entire agreement between the parties with respect to the Securities and there are no other terms, conditions, representations or warranties whether expressed, implied, oral or written, by statute, by common law, by the Issuer or by anyone else.
5.8 The parties to this Subscription Agreement may amend this Subscription Agreement only in writing.
5.9 This Subscription Agreement enures to the benefit of and is binding upon the parties to this Subscription Agreement and their successors and permitted assigns.
5.10 A party to this Subscription Agreement will give all notices to or other written communications with the other party to this Subscription Agreement concerning this Subscription Agreement by hand or by registered mail addressed to the address given on page 1.
5.11 This Subscription Agreement is to be read with all changes in gender or number as required by the context.
Subscription Agreement (with related appendixes, schedules and forms) | Page 15 of 15 pages |
5.12 This Subscription Agreement will be governed by and construed in accordance with the internal laws of British Columbia (without reference to its rules governing the choice or conflict of laws), and the parties hereto irrevocably attorn and submit to the exclusive jurisdiction of the courts of British Columbia with respect to any dispute related to this Subscription Agreement.
END OF GENERAL PROVISIONS
END OF SUBSCRIPTION AGREEMENT