Offering Terms. 3.1 The Units will be offered for sale by the Agents, as agents on behalf of the Corporation, to Purchasers resident in the Qualifying Jurisdictions. 3.2 The sale of the Units to Purchasers is to be effected by the Agents in a manner exempt from any prospectus or offering memorandum filing or delivery requirements of the Applicable Securities Laws and without the necessity of obtaining any order or ruling of the Regulatory Authorities and, for offers and sales in the United States, in accordance with the requirements of the exemption from registration from US federal and state securities laws available under Rule 506 of Regulation D. The Agents will notify the Corporation with respect to the identity and jurisdiction of residence of each Purchaser as soon as practicable and with a view to affording sufficient time to allow the Corporation to confirm compliance with all Applicable Securities Laws in connection with the sale of the Units to the Purchasers. 3.3 The Agents will obtain from each Purchaser a properly completed and duly executed Subscription Agreement and a properly completed and duly executed form of Accredited Investor or U.S. Accredited Investor questionnaire, as applicable, each in the form attached as a Schedule to the Subscription Agreement, together with any additional documentation as may be requested by the Exchange. 3.4 If, in the opinion of the Agents, it is necessary, the Agents will form, manage and participate in a group of sub-agents to offer and sell the Units as provided for hereunder. Each sub-agent shall be appropriately registered under the Applicable Securities Laws so as to permit it to lawfully offer and sell the Units in such jurisdictions in which it offers and sells the Units. In the event that a selling group is formed, the Agents will: (a) manage the selling group as and to the extent customary in the securities industry in Canada; and (b) require each member of the selling group to offer and sell the Units on the terms set forth in this Agreement. 3.5 Each Unit will consist of one Share and one-half of one Warrant. Each whole Warrant will entitle the holder to purchase one Warrant Share of the Corporation for a period of two years from the Closing Date at a price of $2.75 per Warrant Share, after which time the Warrants will expire. 3.6 The Corporation covenants to use its commercial best efforts to satisfy as expeditiously as possible, each of the conditions of the Exchange (the "Exchange Conditions") required to be satisfied prior to the Exchange's acceptance of the Corporation's notice of the Private Placement including, without limitation, obtaining approval of the Private Placement from a majority of the Corporation's shareholders. 3.7 The terms and conditions of the Warrants, the Commission Warrants, the Corporate Finance Fee Warrants and the Broker Warrants and the attributes and characteristics of the Warrants, the Commission Warrants, the Corporate Finance Fee Warrants and the Broker Warrants will be substantially as described in this Agreement subject to the changes, if any, that the Corporation and the Agents (each on its behalf and, with respect to the Warrants, on behalf of the Purchasers) may agree to. 3.8 The Corporation and each of the Agents confirms that the Private Placement has not been, and agrees that it will not be, advertised in any way. 3.9 No selling or promotional expenses will be paid or incurred in connection with the Private Placement, except for professional services or for services performed by a registered dealer. 3.10 The Agents acknowledge that the Securities, the Commission Shares, the Commission Units, the Commission Warrants, the Commission Warrant Shares, the Corporate Finance Fee Shares, the Corporate Finance Fee Units, the Corporate Finance Fee Warrants, the Corporate Finance Fee Warrant Shares, the Broker Warrants and the Broker Warrant Shares have not been, and will not be, registered under the 1933 Act or applicable state securities laws and may not be offered or sold except outside the United States in accordance with Regulation S or, for offers or sales in the United States, offered by the Agents through the US Affiliate, and sold by the Corporation, pursuant to Rule 506 of Regulation D. Accordingly, each of the Agents represents, warrants and covenants to and with the Corporation, without limiting the generality of section 3.1 of this Agreement, - 7 - as follows, which representations an warranties shall be true as of the date of this Agreement and as of the Time of Closing and the Closing Date, and which representations, warranties and covenants shall survive the completion of the transactions contemplated under this Agreement; (a) it has offered and sold, and will offer and sell, the Securities outside the United States only in accordance with Rule 903 of Regulation S and accordingly, neither the Agent, its affiliates nor any persons acting on its or their behalf, has made or will make: (i) except as permitted under (b), any offer to sell, or any solicitation of an offer to buy, any Securities to any person in the United States; (ii) any sale of Securities to any Purchaser unless, at the time the buy order was or will have been originated, the Purchaser was outside the United States, or the Agent, or such affiliate or person acting on behalf of the Agent, reasonably believed that such Purchaser was outside the United States; or (iii) any Directed Selling Efforts in the United States with respect to the Securities; (b) it has offered and sold, and will offer and sell, Securities to Purchasers in the United States only in the following manner: (i) the Agent has offered and sold and will offer and sell the Securities in the United States only through a US Affiliate, which was and is on the dates of such offers and sales a duly registered broker or dealer pursuant to Section 15(b) of the 1934 Act and under the securities laws of each state in which such offers and sales were or are made (unless exempted from the respective state's broker-dealer registration requirements) and was and is a member in good standing with the National Association of Securities Dealers, Inc.; (ii) immediately prior to soliciting offerees, the Agent has or will have reasonable grounds to believe and did or will believe that each offeree was and is an US Accredited Investor; (iii) no form of general solicitation or general advertising (as those terms are used in Regulation D) or any manner involving a public offering within the meaning of Section 4(2) of the 1933 Act has been or will be used by it or its affiliates, including but not limited to advertisements, articles, notices or other communications published in any newspaper, magazine, or similar media or broadcast over radio or television, or any seminar or meeting whose attendees had been invited by general solicitation or general advertising, in connection with the offer or sale of the Securities; (iv) any offer, sale or solicitation of an offer to buy Securities that has been made or will be made in the United States was or will be made only to US Accredited Investors by the Agent through a US Affiliate, and in transactions that are exempt from registration under the 1933 Act and any applicable state securities laws and in accordance with applicable US federal or state laws or regulations governing the registration and conduct of securities brokers and dealers; (v) neither the Agent, its affiliates or any person acting on its behalf (other than the Corporation, its affiliates and any person acting on their behalf, as to which no representation is made) has taken or will take, directly or indirectly, any action in violation of Regulation M under the 1934 Act in connection with the offer and sale of the Securities; and (c) unless, on the Closing Date and prior to the Time of Closing, it and each US Affiliate through which it has offered and sold Securities in the United States has executed and delivered to the Corporation an Agents' Certificate in substantially the form set out in Exhibit "1" - Agents' Certificate, it will be deemed to represent and warrant to the Corporation, as of the Closing Date, that neither it nor any of its affiliates has made any offers or sales of the Securities in the United States.
Appears in 1 contract
Offering Terms. 3.1 The Units will be offered for sale by the Agents, as agents on behalf of the Corporation, to Purchasers resident in the Qualifying Jurisdictions.
3.2 The sale of the Units to Purchasers is to be effected by the Agents in a manner exempt from any prospectus or offering memorandum filing or delivery requirements of the Applicable Securities Laws and without the necessity of obtaining any order or ruling of the Regulatory Authorities and, for offers and sales in the United States, in accordance with the requirements of the exemption from registration from US federal and state securities laws available under Rule 506 of Regulation D. The Agents will notify the Corporation with respect to the identity and jurisdiction of residence of each Purchaser as soon as practicable and with a view to affording sufficient time to allow the Corporation to confirm compliance with all Applicable Securities Laws in connection with the sale of the Units to the Purchasers.
3.3 The Agents will obtain from each Purchaser a properly completed and duly executed Subscription Agreement and a properly completed and duly executed form of Accredited Investor or U.S. Accredited Investor questionnaire, as applicable, and a properly completed and duly executed TSX Private Placement Questionnaire and Undertaking, each in the form attached as a Schedule to the Subscription Agreement, together with any additional documentation as may be requested by the Exchange.
3.4 If, in the opinion of the Agents, it is necessary, the Agents will form, manage and participate in a group of sub-agents to offer and sell the Units as provided for hereunder. Each sub-agent shall be appropriately registered under the Applicable Securities Laws so as to permit it to lawfully offer and sell the Units in such jurisdictions in which it offers and sells the Units. In the event that a selling group is formed, the Agents will:
(a) manage the selling group as and to the extent customary in the securities industry in Canada; and
(b) require each member of the selling group to offer and sell the Units on the terms set forth in this Agreement.
3.5 Each Unit will consist of one Share and one-half of one Warrant. Each whole Warrant will entitle the holder to purchase one Warrant Share of the Corporation for a period of two years from the Closing Date at a price of $2.75 1.45 per Warrant ShareShare for the first year and at a price of $1.65 per Warrant Share for the subsequent year, after which time the Warrants will expire.
3.6 The Corporation covenants to use its commercial best efforts to satisfy as expeditiously as possible, each of the conditions of the Exchange (the "Exchange Conditions") required to be satisfied prior to the Exchange's acceptance of the Corporation's notice of the Private Placement including, without limitation, obtaining approval of the Private Placement from a majority of the Corporation's shareholdersPlacement.
3.7 The terms and conditions of the Warrants, the Commission Warrants, the Corporate Finance Fee Warrants and the Broker Warrants and the attributes and characteristics of the Warrants, the Commission Warrants, the Corporate Finance Fee Warrants and the Broker Warrants will be substantially as described in this Agreement subject to the changes, if any, that the Corporation and the Agents (each on its behalf and, with respect to the Warrants, on behalf of the Purchasers) may agree to.
3.8 The Corporation and each of the Agents confirms that the Private Placement has not been, and agrees that it will not be, advertised in any way.
3.9 No selling or promotional expenses will be paid or incurred in connection with the Private Placement, except for professional services or for services performed by a registered dealer.
3.10 The Agents acknowledge that the Securities, the Commission Shares, the Commission Units, the Commission Warrants, the Commission Warrant Shares, the Corporate Finance Fee Shares, the Corporate Finance Fee Units, the Corporate Finance Fee Warrants, the Corporate Finance Fee Warrant Shares, the Broker Warrants and the Broker Warrant Shares have not been, and will not be, registered under the 1933 Act or applicable state securities laws and may not be offered or sold except outside the United States in accordance with Regulation S or, for offers or sales in the United States, offered by the Agents through the US Affiliate, and sold by the Corporation, pursuant to Rule 506 of Regulation D. Accordingly, each of the Agents represents, warrants and covenants to and with the Corporation, without limiting the generality of section 3.1 of this Agreement, - 7 - as follows, which representations an warranties shall be true as of the date of this Agreement and as of the Time of Closing and the Closing Date, and which representations, warranties and covenants shall survive the completion of the transactions contemplated under this Agreement;:
(a) it has offered and sold, and will offer and sell, the Securities outside the United States only in accordance with Rule 903 of Regulation S and accordingly, neither the Agent, its affiliates nor any persons acting on its or their behalf, has made or will make:
(i) except as permitted under (b), any offer to sell, or any solicitation of an offer to buy, any Securities to any person in the United States;
(ii) any sale of Securities to any Purchaser unless, at the time the buy order was or will have been originated, the Purchaser was outside the United States, or the Agent, or such affiliate or person acting on behalf of the Agent, reasonably believed that such Purchaser was outside the United States; or
(iii) any Directed Selling Efforts in the United States with respect to the Securities;
(b) it has offered and sold, and will offer and sell, Securities to Purchasers in the United States only in the following manner:
(i) the Agent has offered and sold and will offer and sell the Securities in the United States only through a US Affiliate, which was and is on the dates of such offers and sales a duly registered broker or dealer pursuant to Section 15(b) of the 1934 Act and under the securities laws of each state in which such offers and sales were or are made (unless exempted from the respective state's broker-dealer registration requirements) and was and is a member in good standing with the National Association of Securities Dealers, Inc.;
(ii) immediately prior to soliciting offerees, the Agent has or will have reasonable grounds to believe and did or will believe that each offeree was and is an US Accredited Investor;
(iii) no form of general solicitation or general advertising (as those terms are used in Regulation D) or any manner involving a public offering within the meaning of Section 4(2) of the 1933 Act has been or will be used by it or its affiliates, including but not limited to advertisements, articles, notices or other communications published in any newspaper, magazine, or similar media or broadcast over radio or television, or any seminar or meeting whose attendees had been invited by general solicitation or general advertising, in connection with the offer or sale of the Securities;
(iv) any offer, sale or solicitation of an offer to buy Securities that has been made or will be made in the United States was or will be made only to US Accredited Investors by the Agent through a US Affiliate, and in transactions that are exempt from registration under the 1933 Act and any applicable state securities laws and in accordance with applicable US federal or state laws or regulations governing the registration and conduct of securities brokers and dealers;
(v) neither the Agent, its affiliates or any person acting on its behalf (other than the Corporation, its affiliates and any person acting on their behalf, as to which no representation is made) has taken or will take, directly or indirectly, any action in violation of Regulation M under the 1934 Act in connection with the offer and sale of the Securities; and
(c) unless, on the Closing Date and prior to the Time of Closing, it and each US Affiliate through which it has offered and sold Securities in the United States has executed and delivered to the Corporation an Agents' Certificate in substantially the form set out in Exhibit "1" - Agents' Certificate, it will be deemed to represent and warrant to the Corporation, as of the Closing Date, that neither it nor any of its affiliates has made any offers or sales of the Securities in the United States.
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