Exhibit 10.3
WESTERN STANDARD ENERGY CORP.
PRIVATE PLACEMENT SUBSCRIPTION AGREEMENT
(SHARES)
INSTRUCTIONS TO PURCHASER
1. All purchasers must complete all the information in the boxes on page 2 and
sign where indicated with an "X".
2. All purchasers must complete and sign Exhibit A "Canadian Investor
Questionnaire" that starts on page 16. The purpose of the form is to
determine whether you meet the standards for participation in a private
placement under applicable Canadian securities law (National Instrument
45-106 PROSPECTUS AND REGISTRATION EXEMPTIONS).
3. If you are a "U.S. Purchaser", as defined in Exhibit B, you must complete
and sign BOTH:
(1) Exhibit A "Canadian Investor Questionnaire" that starts on page 16;
AND
(2) Exhibit B "United States Accredited Investor Questionnaire" that
starts on page 19.
4. If you are paying for your subscription with funds drawn from a Canadian
bank, you may pay by certified cheque or bank draft drawn on a Canadian
chartered bank.
5. If you are paying for your subscription with funds drawn on any source
other than a Canadian chartered bank, you may only pay by wire transfer to
the Issuer pursuant to the Issuer's wiring instructions.
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WESTERN STANDARD ENERGY CORP.
PRIVATE PLACEMENT SUBSCRIPTION AGREEMENT
The undersigned (the "SUBSCRIBER") hereby irrevocably subscribes for and agrees
to purchase from Western Standard Energy Corp. (the "ISSUER") that number of
shares of common stock of the Issuer (each, a "SHARE") set out below at a price
of US$0.00125 per Share. The Subscriber agrees to be bound by the terms and
conditions set forth in the attached "Terms and Conditions of Subscription for
Shares".
Subscriber Information Shares to be Purchased
Number of Shares: X $0.00125
------------------------------------------------ -------------------------------
(Name of Subscriber)
CHECK IF APPLICABLE: [ ] Insider [ ] Registrant Aggregate Subscription Price:
-------------------
X (the "Subscription Amount", plus wire fees if
------------------------------------------------ applicable)
(Signature of Subscriber - if the Subscriber is
an Individual)
------------------------------------------------
X Please complete if purchasing as agent or trustee
------------------------------------------------ for a principal (beneficial purchaser) (a
(Signature of Authorized Signatory - if the "Disclosed Principal") and not purchasing as trustee
Subscriber is not an Individual) or agent for accounts fully managed by it.
------------------------------------------------ ------------------------------------------------
(Name and Title of Authorized Signatory - if the (Name of Disclosed Principal)
Subscriber is not an Individual)
------------------------------------------------
------------------------------------------------ (Address of Disclosed Principal)
(SIN, SSN, or other Tax Identification Number
of the Subscriber) ------------------------------------------------
(Account Reference, if applicable)
------------------------------------------------
(Subscriber's Address, including city and ------------------------------------------------
Postal Code) (SIN, SSN, or other Tax Identification Number
of Disclosed Principal)
------------------------------------------------
Deliver the Shares as set forth below:
------------------------------------------------
(Telephone Number) (Email Address) ------------------------------------------------
(Attention - Name)
Register the Shares as set forth below:
------------------------------------------------
------------------------------------------------ (Account Reference, if applicable)
(Name to Appear on Share Certificate)
------------------------------------------------
------------------------------------------------ (Street Address, including Postal Code) (No PO Box)
(Account Reference, if applicable)
------------------------------------------------
------------------------------------------------ (Telephone Number)
(Address, including Postal Code)
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ACCEPTANCE
The Issuer hereby accepts the subscription as set forth above on the terms and
conditions contained in this Private Placement Subscription Agreement (including
the Terms and Conditions and Exhibits attached hereto) as of the ____ day of
_______________________, 2012.
WESTERN STANDARD ENERGY CORP.
Per:
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Authorized Signatory
Address: ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
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▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇
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Fax:
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Email: ▇▇▇▇@▇▇▇▇.▇▇
------------------------------------------
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
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TERMS AND CONDITIONS OF SUBSCRIPTION FOR SHARES
1. SUBSCRIPTION
1.1 On the basis of the representations and warranties and subject to the terms
and conditions set forth herein, the Subscriber hereby irrevocably
subscribes for and agrees to purchase Shares of the Issuer at a price of
$0.00125 per Share (such subscription and agreement to purchase being the
"SUBSCRIPTION"), for the Subscription Amount shown on page 2 of this
subscription agreement (this "AGREEMENT"), which is tendered herewith, on
the basis of the representations and warranties and subject to the terms
and conditions set forth in this Agreement.
1.2 The Issuer hereby agrees to sell the Shares to the Subscriber on the basis
of the representations and warranties and subject to the terms and
conditions set forth in this Agreement. Subject to the terms of this
Agreement, this Agreement will be effective upon its acceptance by the
Issuer.
1.3 The Subscriber acknowledges that the Shares have been offered as part of an
offer by the Issuer of such other number of Shares as may be determined by
the board of directors of the Issuer in its sole discretion (the
"OFFERING").
1.4 Unless otherwise provided, all dollar amounts referred to in this Agreement
are in lawful money of the United States of America.
2. PAYMENT
2.1 The Subscription Amount must accompany this Subscription and shall be paid
by:
(a) if the Subscriber is drawing funds from a Canadian bank to pay for
this Subscription, a certified cheque or bank draft drawn on a U.S.
dollar account with a Canadian chartered bank; or
(b) if the Subscriber is drawing funds from any source other than a
Canadian chartered bank to pay for this Subscription, then only by
wire transfer to the Issuer.
2.2 Where the Subscription Amount is paid to the Issuer, the Subscriber
authorizes the Issuer to treat such Subscription Amount as an interest free
loan to the Issuer until such time as the Subscription is accepted and the
certificates representing the Shares have been issued to the Subscriber.
3. DOCUMENTS REQUIRED FROM SUBSCRIBER
3.1 The Subscriber must complete, sign and return to the Issuer the following
documents:
(a) an executed copy of this Agreement;
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(b) unless the Subscriber is purchasing Shares with an aggregate purchase
price of CDN$150,000 or more, a Canadian Investor Questionnaire (the
"Canadian Questionnaire") attached as Exhibit A that starts on page
14;
(c) if the Subscriber is a U.S. Purchaser (as defined in Exhibit B), the
Canadian Questionnaire and the U.S. Investor Questionnaire (the "U.S.
Questionnaire" and, together with the Canadian Questionnaire, the
"Questionnaires") attached as Exhibit B that starts on page 17; and
(d) such other supporting documentation that the Issuer or its legal
counsel may request to establish the Subscriber's qualification as a
qualified investor.
3.2 The Subscriber shall complete, sign and return to the Issuer as soon as
possible, on request by the Issuer, any additional documents,
questionnaires, notices and undertakings as may be required by any
regulatory authorities and applicable law.
3.3 Both parties to this Agreement acknowledge and agree that ▇▇▇▇▇ ▇▇▇▇▇▇ LLP
has acted as counsel only to the Issuer and is not protecting the rights
and interests of the Subscriber. The Subscriber acknowledges and agrees
that the Issuer and ▇▇▇▇▇ ▇▇▇▇▇▇ LLP have given the Subscriber the
opportunity to seek, and are hereby recommending that the Subscriber
obtain, independent legal advice with respect to the subject matter of this
Agreement and, further, the Subscriber hereby represents and warrants to
the Issuer and ▇▇▇▇▇ ▇▇▇▇▇▇ LLP that the Subscriber has sought independent
legal advice or waives such advice.
4. CONDITIONS AND CLOSING
The closing of the purchase and sale of the Shares shall occur on or before
___________________, 2012, or on such other date as may be determined by the
Issuer in its sole discretion (the "CLOSING DATE"). The Subscriber acknowledges
that Shares may be issued to other subscribers under this offering (the
"OFFERING") before or after the Closing Date. The Issuer, may, in its
discretion, elect to close the Offering in one or more closings, in which event
the Issuer may agree with one or more subscribers (including the Subscriber
hereunder) to complete delivery of the Shares to such subscriber(s) against
payment therefore at any time on or prior to the Closing Date.
5. ACKNOWLEDGEMENTS AND AGREEMENTS OF SUBSCRIBER
The Subscriber acknowledges and agrees that:
(a) none of the Shares have been or will be registered under the United
States SECURITIES ACT OF 1933, AS AMENDED, (the "1933 Act"), or under
any securities or "blue sky" laws of any state of the United States,
and, unless so registered, may not be offered or sold in the United
States or, directly or indirectly, to any "U.S. Person", as that term
is defined in Regulation S under the 1933 Act ("Regulation S"), except
in accordance with the provisions of Regulation S, pursuant to an
effective registration statement under the 1933 Act, or pursuant to an
exemption from, or in a transaction not subject to, the registration
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requirements of the 1933 Act and in each case only in accordance with
applicable state, provincial and foreign securities laws;
(b) the Issuer has not undertaken, and will have no obligation, to
register any of the Shares under the 1933 Act or any other securities
legislation;
(c) the decision to execute this Agreement and acquire the Shares agreed
to be purchased hereunder has not been based upon any oral or written
representation as to fact or otherwise made by or on behalf of the
Issuer and such decision is based entirely upon a review of any public
information which has been filed by the Issuer with the United States
Securities and Exchange Commission (the "SEC") and any Canadian
provincial securities commissions (collectively, the "Public Record");
(d) there are risks associated with the purchase of the Shares, as more
fully described in the Issuer's periodic disclosure forming part of
the Public Record;
(e) the Subscriber understands and agrees that the Issuer and others will
rely upon the truth and accuracy of the acknowledgements,
representations, warranties, covenants and agreements contained in
this Agreement and the Questionnaires, as applicable, and agrees that
if any of such acknowledgements, representations and agreements are no
longer accurate or have been breached, the Subscriber shall promptly
notify the Issuer;
(f) the Subscriber and the Subscriber's advisor(s) have had a reasonable
opportunity to ask questions of and receive answers from the Issuer in
connection with the distribution of the Shares hereunder, and to
obtain additional information, to the extent possessed or obtainable
without unreasonable effort or expense, necessary to verify the
accuracy of the information about the Issuer;
(g) finder's fees or broker's commissions may be payable by the Issuer to
finders who introduce purchasers to the Issuer;
(h) the books and records of the Issuer were available upon reasonable
notice for inspection, subject to certain confidentiality
restrictions, by the Subscriber during reasonable business hours at
its principal place of business, and all documents, records and books
in connection with the distribution of the Shares hereunder have been
made available for inspection by the Subscriber, the Subscriber's
lawyer and/or advisor(s);
(i) all of the information which the Subscriber has provided to the Issuer
is correct and complete as of the date this Agreement is signed, and
if there should be any change in such information prior to the
Closing, the Subscriber will immediately provide the Issuer with such
information;
(j) the Issuer is entitled to rely on the representations and warranties
of the Subscriber contained in this Agreement and the Questionnaires,
as applicable, and the Subscriber will hold harmless the Issuer from
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any loss or damage it or they may suffer as a result of the
Subscriber's failure to correctly complete this Agreement or the
Questionnaires, as applicable;
(k) the Subscriber has been advised to consult the Subscriber's own legal,
tax and other advisors with respect to the merits and risks of an
investment in the Shares and with respect to applicable resale
restrictions, and it is solely responsible (and the Issuer is not in
any way responsible) for compliance with:
(i) any applicable laws of the jurisdiction in which the Subscriber
is resident in connection with the distribution of the Shares
hereunder, and
(ii) applicable resale restrictions;
(l) the Subscriber understands and agrees that there may be material tax
consequences to the Subscriber of an acquisition or disposition of the
Shares. The Issuer gives no opinion and makes no representation with
respect to the tax consequences to the Subscriber under federal,
state, provincial, local or foreign tax law of the Subscriber's
acquisition or disposition of the Shares;
(m) in addition to resale restrictions imposed under U.S. securities laws,
there are additional restrictions on the Subscriber's ability to
resell any of the Shares in Canada under applicable provincial
securities laws and Multilateral Instrument 51-105 - ISSUERS QUOTED IN
THE U.S. OVER THE COUNTER MARKETS ("MI 51-105") of the Canadian
Securities Administrators;
(n) the Issuer has advised the Subscriber that the Issuer is relying on an
exemption from the requirements to provide the Subscriber with a
prospectus and to sell the Shares through a person registered to sell
securities under provincial securities legislation and other
applicable securities laws, as a consequence of acquiring the Shares
pursuant to such exemption, certain protections, rights and remedies
provided by the applicable securities legislation including the
various provincial securities acts, including statutory rights of
rescission or damages, will not be available to the Subscriber;
(o) no documents in connection with the sale of the Shares have been
reviewed by the SEC or any securities administrators;
(p) neither the SEC nor any securities commission or similar regulatory
authority has reviewed or passed on the merits of any of the Shares;
(q) there is no government or other insurance covering any of the Shares;
(r) the Issuer will refuse to register the transfer of any of the Shares
to a U.S. Person not made pursuant to an effective registration
statement under the 1933 Act or pursuant to an available exemption
from the registration requirements of the 1933 Act and, in each case,
in accordance with any other applicable laws; and
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(s) this Agreement is not enforceable by the Subscriber unless it has been
accepted by the Issuer, and the Subscriber acknowledges and agrees
that the Issuer reserves the right to reject any Subscription for any
reason whatsoever.
6. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE SUBSCRIBER
6.1 The Subscriber hereby represents and warrants to and covenants with the
Issuer (which representations, warranties and covenants shall survive the
Closing) that:
(a) unless the Subscriber is a U.S. Purchaser (as defined in Exhibit B),
the Subscriber is not a U.S. Person;
(b) the Subscriber (i) has adequate net worth and means of providing for
its current financial needs and possible personal contingencies, (ii)
has no need for liquidity in this investment, (iii) is able to bear
the economic risks of an investment in the Shares for an indefinite
period of time, and (iv) can afford the complete loss of such
investment;
(c) if the Subscriber is resident outside of Canada and outside the U.S.:
(i) the Subscriber is knowledgeable of, or has been independently
advised as to, the applicable laws of the securities regulators
having application in the jurisdiction in which the Subscriber is
resident (the "INTERNATIONAL JURISDICTION") which would apply to
the offer and sale of the Shares,
(ii) the Subscriber is purchasing the Shares pursuant to exemptions
from prospectus or equivalent requirements under applicable laws
or, if such is not applicable, the Subscriber is permitted to
purchase the Shares under the applicable laws of the securities
regulators in the International Jurisdiction without the need to
rely on any exemptions,
(iii)the applicable laws of the authorities in the International
Jurisdiction do not require the Issuer to make any filings or
seek any approvals of any kind whatsoever from any securities
regulator of any kind whatsoever in the International
Jurisdiction in connection with the offer, issue, sale or resale
of any of the Shares,
(iv) the purchase of the Shares by the Subscriber does not trigger:
A. any obligation to prepare and file a prospectus or similar
document, or any other report with respect to such purchase
in the International Jurisdiction, or
B. any continuous disclosure reporting obligation of the Issuer
in the International Jurisdiction, and
(v) the Subscriber will, if requested by the Issuer, deliver to the
Issuer a certificate or opinion of local counsel from the
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International Jurisdiction which will confirm the matters
referred to in subparagraphs (ii), (iii) and (iv) above to the
satisfaction of the Issuer, acting reasonably;
(d) the Subscriber has the legal capacity and competence to enter into and
execute this Agreement and to take all actions required pursuant
hereto and, if the Subscriber is a corporate entity, 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 obtained to authorize execution and
performance of this Agreement on behalf of the Subscriber;
(e) the entering into of this Agreement and the transactions contemplated
hereby do not result in the violation of any of the terms and
provisions of any law applicable to, or, if applicable, the constating
documents of, the Subscriber or of any agreement, written or oral, to
which the Subscriber may be a party or by which the Subscriber is or
may be bound;
(f) the Subscriber has duly executed and delivered this Agreement and it
constitutes a valid and binding agreement of the Subscriber
enforceable against the Subscriber;
(g) the Subscriber is aware that an investment in the Issuer is
speculative and involves certain risks (including those risks
disclosed in the Public Record), including the possible loss of the
entire investment;
(h) the Subscriber has made an independent examination and investigation
of an investment in the Shares and the Issuer and agrees that the
Issuer will not be responsible in any way whatsoever for the
Subscriber's decision to invest in the Shares and the Issuer;
(i) all information contained in the Questionnaires, as applicable, is
complete and accurate and may be relied upon by the Issuer, and the
Subscriber will notify the Issuer immediately of any material change
in any such information occurring prior to the closing of the purchase
of the Shares;
(j) the Subscriber is purchasing the Shares for its own account for
investment purposes only and not for the account of any other person
and not for distribution, assignment or resale to others, and no other
person has a direct or indirect beneficial interest is such Shares,
and the Subscriber has not subdivided his interest in the Shares with
any other person;
(k) the Subscriber (i) is able to fend for itself in the Subscription;
(ii) has such knowledge and experience in business matters as to be
capable of evaluating the merits and risks of its prospective
investment in the Shares; and (iii) has the ability to bear the
economic risks of its prospective investment and can afford the
complete loss of such investment;
(l) the Subscriber is not an underwriter of, or dealer in, any of the
Shares, nor is the Subscriber participating, pursuant to a contractual
agreement or otherwise, in the distribution of the Shares or any of
them;
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(m) the Subscriber is not aware of any advertisement of any of the Shares
and is not acquiring the Shares as a result of any form of general
solicitation or general advertising, including 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 have been invited by general
solicitation or general advertising;
(n) no person has made to the Subscriber any written or oral
representations:
(i) that any person will resell or repurchase any of the Shares,
(ii) that any person will refund the purchase price of any of the
Shares, or
(iii) as to the future price or value of any of the Shares;
(o) the Subscriber understands and agrees that none of the Shares have
been registered under the 1933 Act, or under any state securities or
"blue sky" laws of any state of the United States, and, unless so
registered, may not be offered or sold in the United States or,
directly or indirectly, to U.S. Persons except in accordance with the
provisions of Regulation S, pursuant to an effective registration
statement under the 1933 Act, or pursuant to an exemption from, or in
a transaction not subject to, the registration requirements of the
1933 Act and in each case only in accordance with applicable state,
provincial and foreign securities laws;
(p) if the Subscriber is resident outside the U.S., the Subscriber
understands and agrees that offers and sales of any of the Shares
prior to the expiration of the period specified in Regulation S (such
period hereinafter referred to as the "DISTRIBUTION COMPLIANCE
PERIOD") shall only be made in compliance with the safe harbor
provisions set forth in Regulation S, pursuant to the registration
provisions of the 1933 Act or an exemption therefrom, and that all
offers and sales after the Distribution Compliance Period shall be
made only in compliance with the registration provisions of the 1933
Act or an exemption therefrom and in each case only in accordance with
applicable state and provincial securities laws;
(q) the Subscriber acknowledges that it has not acquired the Shares as a
result of, and will not itself engage in, any "directed selling
efforts" (as defined in Regulation S under the ▇▇▇▇ ▇▇▇) in the United
States in respect of any of the Shares which would include any
activities undertaken for the purpose of, or that could reasonably be
expected to have the effect of, conditioning the market in the United
States for the resale of any of the Shares; provided, however, that
the Subscriber may sell or otherwise dispose of any of the Shares
pursuant to registration of any of the Shares pursuant to the 1933 Act
and any applicable securities laws or under an exemption from such
registration requirements and as otherwise provided herein;
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(r) hedging transactions involving the Securities may not be conducted
unless such transactions are in compliance with the provisions of the
1933 Act and in each case only in accordance with applicable
Securities Laws; and
(s) the Subscriber acknowledges and agrees that the Issuer shall not
consider the Subscriber's Subscription for acceptance unless the
undersigned provides to the Issuer, along with an executed copy of
this Agreement:
(i) fully completed and executed Questionnaires in the form attached
hereto as Exhibit A and, if applicable, Exhibit B,
(ii) by completing the Canadian Questionnaire, the Subscriber is
representing and warranting that the Subscriber satisfies one of
the categories of registration and prospectus exemptions provided
in National Instrument 45-106 - PROSPECTUS AND REGISTRATION
EXEMPTIONS ("NI 45-106") adopted by the Canadian Securities
Administrators; and
(iii)such other supporting documentation that the Issuer or its legal
counsel may request to establish the Subscriber's qualification
as a qualified investor.
6.2 In this Agreement, the term "U.S. PERSON" shall have the meaning ascribed
thereto in Regulation S promulgated under the 1933 Act and for the purpose
of the Agreement includes any person in the United States.
7. REPRESENTATIONS AND WARRANTIES WILL BE RELIED UPON BY THE ISSUER
The Subscriber acknowledges that the representations and warranties contained
herein are made by it with the intention that such representations and
warranties may be relied upon by the Issuer and its legal counsel in determining
the Subscriber's eligibility to purchase the Shares under applicable
legislation, or (if applicable) the eligibility of others on whose behalf it is
contracting hereunder to purchase the Shares under applicable legislation. The
Subscriber further agrees that by accepting delivery of the certificates
representing the Shares on the Closing Date, it will be representing and
warranting that the representations and warranties contained herein are true and
correct as at the Closing Date with the same force and effect as if they had
been made by the Subscriber on the Closing Date and that they will survive the
purchase by the Subscriber of the Shares and will continue in full force and
effect notwithstanding any subsequent disposition by the Subscriber of such
Shares.
8. ACKNOWLEDGEMENT AND WAIVER
The Subscriber has acknowledged that the decision to acquire the Shares was
solely made on the basis of publicly available information. The Subscriber
hereby waives, to the fullest extent permitted by law, any rights of withdrawal,
rescission or compensation for damages to which the Subscriber might be entitled
in connection with the distribution of any of the Shares.
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9. LEGENDING AND REGISTRATION OF SHARES
9.1 If the Subscriber is a U.S. Person, the Subscriber hereby acknowledges that
upon the issuance thereof, and until such time as the same is no longer
required under the applicable securities laws and regulations, the
certificates or other document representing any of the Shares will bear a
legend in substantially the following form:
"NONE OF THE SECURITIES REPRESENTED HEREBY HAVE BEEN
REGISTERED UNDER THE 1933 ACT, OR ANY U.S. STATE SECURITIES
LAWS, AND, UNLESS SO REGISTERED, NONE MAY BE OFFERED OR SOLD,
DIRECTLY OR INDIRECTLY, IN THE UNITED STATES OR TO U.S.
PERSONS (AS DEFINED HEREIN) EXCEPT IN ACCORDANCE WITH THE
PROVISIONS OF REGULATION S UNDER THE 1933 ACT, PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE 1933 ACT, OR
PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT
TO, THE REGISTRATION REQUIREMENTS OF THE 1933 ACT AND IN EACH
CASE ONLY IN ACCORDANCE WITH APPLICABLE SECURITIES LAWS.
THE HOLDER OF THE SECURITIES REPRESENTED HEREBY MUST NOT TRADE
THE SECURITIES IN OR FROM A JURISDICTION OF CANADA UNLESS THE
CONDITIONS IN SECTION 13 OF MULTILATERAL INSTRUMENT 51-105
ISSUERS QUOTED IN THE U.S. OVER THE COUNTER MARKETS ARE MET."
9.2 If the Subscriber is not a U.S. Person, the Subscriber hereby acknowledges
that upon the issuance thereof, and until such time as the same is no
longer required under the applicable securities laws and regulations, the
certificates or other document representing any of the Shares will bear a
legend in substantially the following form:
"THE SECURITIES REPRESENTED HEREBY HAVE BEEN OFFERED IN AN
OFFSHORE TRANSACTION TO PERSONS WHO ARE NOT U.S. PERSONS (AS
DEFINED HEREIN) PURSUANT TO REGULATION S UNDER THE UNITED
STATES SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT").
NONE OF THE SECURITIES REPRESENTED HEREBY HAVE BEEN REGISTERED
UNDER THE 1933 ACT, OR ANY U.S. STATE SECURITIES LAWS, AND,
UNLESS SO REGISTERED, NONE MAY BE OFFERED OR SOLD, DIRECTLY OR
INDIRECTLY, IN THE UNITED STATES OR TO U.S. PERSONS (AS
DEFINED HEREIN) EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF
REGULATION S UNDER THE 1933 ACT, PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE 1933 ACT, OR PURSUANT TO AN
EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE 1933 ACT AND IN EACH CASE
ONLY IN ACCORDANCE WITH APPLICABLE SECURITIES LAWS. IN
ADDITION, HEDGING TRANSACTIONS INVOLVING THE SECURITIES MAY
NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH THE 1933 ACT.
THE HOLDER OF THE SECURITIES REPRESENTED HEREBY MUST NOT TRADE
THE SECURITIES IN OR FROM A JURISDICTION OF CANADA UNLESS THE
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CONDITIONS IN SECTION 13 OF MULTILATERAL INSTRUMENT 51-105
ISSUERS QUOTED IN THE U.S. OVER THE COUNTER MARKETS ARE MET."
9.3 The Subscriber hereby acknowledges and agrees to the Issuer making a
notation on its records or giving instructions to the registrar and
transfer agent of the Issuer in order to implement the restrictions on
transfer set forth and described in this Agreement.
10. RESALE RESTRICTIONS
The Subscriber acknowledges that the Securities are subject to resale
restrictions in Canada and the United States and may not be traded in Canada or
the United States except as permitted by the applicable federal, state and
provincial securities laws and the rules made thereunder.
11. COLLECTION OF PERSONAL INFORMATION
The Subscriber acknowledges and consents to the fact that the Issuer is
collecting the Subscriber's personal information for the purpose of fulfilling
this Agreement and completing the Offering. The Subscriber's personal
information (and, if applicable, the personal information of those on whose
behalf the Subscriber is contracting hereunder) may be disclosed by the Issuer
to (a) stock exchanges or securities regulatory authorities, (b) the Issuer's
registrar and transfer agent, (c) Canadian tax authorities, (d) authorities
pursuant to the PROCEEDS OF CRIME (MONEY LAUNDERING) AND TERRORIST FINANCING ACT
(Canada) and (e) any of the other parties involved in the Offering, including
legal counsel, and may be included in record books in connection with the
Offering. By executing this Agreement, the Subscriber is deemed to be consenting
to the foregoing collection, use and disclosure of the Subscriber's personal
information (and, if applicable, the personal information of those on whose
behalf the Subscriber is contracting hereunder) for the foregoing purposes and
to the retention of such personal information for as long as permitted or
required by law or business practice. Notwithstanding that the Subscriber may be
purchasing Shares as agent on behalf of an undisclosed principal, the Subscriber
agrees to provide, on request, particulars as to the nature and identity of such
undisclosed principal, and any interest that such undisclosed principal has in
the Issuer, all as may be required by the Issuer in order to comply with the
foregoing.
Furthermore, the Subscriber is hereby notified that:
(a) the Issuer may deliver to any securities commission having
jurisdiction over the Issuer, the Subscriber or this subscription,
including any Canadian provincial securities commissions and/or the
SEC (collectively, the "Commissions") certain personal information
pertaining to the Subscriber, including such Subscriber's full name,
residential address and telephone number, the number of shares or
other securities of the Issuer owned by the Subscriber, the number of
Shares purchased by the Subscriber and the total purchase price paid
for such Shares, the prospectus exemption relied on by the Issuer and
the date of distribution of the Shares,
(b) such information is being collected indirectly by the Commissions
under the authority granted to them in securities legislation,
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(c) such information is being collected for the purposes of the
administration and enforcement of the securities laws, and
(d) the Subscriber may contact the following public official in Ontario
with respect to questions about the Ontario Securities Commission's
indirect collection of such information at the following address and
telephone number:
Administrative Assistant to the Director of Corporate Finance
Ontario Securities Commission
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12. COSTS
The Subscriber acknowledges and agrees that all costs and expenses incurred by
the Subscriber (including any fees and disbursements of any special counsel
retained by the Subscriber) relating to the purchase of the Shares shall be
borne by the Subscriber.
13. GOVERNING LAW
This Agreement is governed by the laws of the Province of British Columbia and
the federal laws of Canada applicable therein. The Subscriber, in its personal
or corporate capacity and, if applicable, on behalf of each beneficial purchaser
for whom it is acting, irrevocably attorns to the jurisdiction of the courts of
the Province of British Columbia.
14. CURRENCY
Any reference to currency in this Agreement is to the currency of the United
States unless otherwise indicated.
15. SURVIVAL
This Agreement, including, without limitation, the representations, warranties
and covenants contained herein, shall survive and continue in full force and
effect and be binding upon the parties hereto notwithstanding the completion of
the purchase of the Shares by the Subscriber pursuant hereto.
16. ASSIGNMENT
This Agreement is not transferable or assignable.
17. SEVERABILITY
The invalidity or unenforceability of any particular provision of this Agreement
shall not affect or limit the validity or enforceability of the remaining
provisions of this Agreement.
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18. ENTIRE AGREEMENT
Except as expressly provided in this Agreement and in the exhibits, agreements,
instruments and other documents attached hereto or contemplated or provided for
herein, this Agreement contains the entire agreement between the parties with
respect to the sale of the Shares and there are no other terms, conditions,
representations or warranties, whether expressed, implied, oral or written, by
statute or common law, by the Issuer or by anyone else.
19. NOTICES
All notices and other communications hereunder shall be in writing and shall be
deemed to have been duly given if mailed or transmitted by any standard form of
telecommunication, including facsimile, electronic mail or other means of
electronic communication capable of producing a printed copy. Notices to the
Subscriber shall be directed to the address of the Subscriber set forth on page
2 of this Agreement and notices to the Issuer shall be directed to it at the
address of the Issuer set forth on page 3 of this Agreement.
20. COUNTERPARTS AND ELECTRONIC MEANS
This Agreement may be executed in any number of counterparts, each of which,
when so executed and delivered, shall constitute an original and all of which
together shall constitute one instrument. Delivery of an executed copy of this
Agreement by electronic facsimile transmission or other means of electronic
communication capable of producing a printed copy will be deemed to be execution
and delivery of this Agreement as of the date hereinafter set forth.
21. EXHIBITS
The exhibits attached hereto form part of this Agreement.
22. INDEMNITY
The Subscriber will indemnify and hold harmless the Issuer and, where
applicable, its directors, officers, employees, agents, advisors and
shareholders, from and against any and all loss, liability, claim, damage and
expense whatsoever (including, but not limited to, any and all fees, costs and
expenses whatsoever reasonably incurred in investigating, preparing or defending
against any claim, lawsuit, administrative proceeding or investigation whether
commenced or threatened) arising out of or based upon any representation or
warranty of the Subscriber contained in this Agreement, the Questionnaires, as
applicable, or in any document furnished by the Subscriber to the Issuer in
connection herewith being untrue in any material respect or any breach or
failure by the Subscriber to comply with any covenant or agreement made by the
Subscriber to the Issuer in connection therewith.
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EXHIBIT A
CANADIAN INVESTOR QUESTIONNAIRE
All capitalized terms herein, unless otherwise defined, have the meanings
ascribed thereto in the Subscription Agreement between Western Standard Energy
Corp. (the "ISSUER") and the undersigned (the "SUBSCRIBER").
The purpose of this Canadian Investor Questionnaire (this "QUESTIONNAIRE") is to
assure the Issuer that the Subscriber will meet certain requirements of National
Instrument 45-106 ("NI 45-106"). The Issuer will rely on the information
contained in this Questionnaire for the purposes of such determination.
The Subscriber covenants, represents and warrants to the Issuer that:
1. if the Subscriber is not a resident of Ontario, the Subscriber is (TICK ONE
OR MORE OF THE FOLLOWING BOXES):
[ ] (A) a director, executive officer, founder or control person of the Issuer
or an affiliate of the Issuer;
[ ] (B) a spouse, parent, grandparent, brother, sister, child or grandchild of
a director, executive officer, founder or control person of the Issuer
or an affiliate of the Issuer;
[ ] (C) a parent, grandparent, brother, sister, child or grandchild of the
spouse of a director, executive officer, founder or control person of
the Issuer or an affiliate of the Issuer;
[ ] (D) a close personal friend of a director, executive officer, founder or
control person of the Issuer;
[ ] (E) a close business associate of a director, executive officer, founder
or control person of the Issuer or an affiliate of the Issuer;
[ ] (F) an accredited investor;
[ ] (G) a company, partnership or other entity of which a majority of the
voting securities are beneficially owned by, or a majority of the
directors are, persons described in paragraphs A to F; or
[ ] (H) a trust or estate of which all of the beneficiaries or a majority of
the trustees or executors are persons described in paragraphs A to F;
2. if the Subscriber has checked box B, C, D, E, G or H in Section 1 above,
the director, executive officer, founder or control person of the Issuer
with whom the undersigned has the relationship is:
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and the Subscriber has known such person for _____ years.
(INSTRUCTIONS TO SUBSCRIBER: FILL IN THE NAME OF EACH DIRECTOR, EXECUTIVE
OFFICER, FOUNDER AND CONTROL PERSON WHICH YOU HAVE THE ABOVE-MENTIONED
RELATIONSHIP WITH. IF YOU HAVE CHECKED BOX G OR H, ALSO INDICATE WHICH OF A
TO F DESCRIBES THE SECURITYHOLDERS, DIRECTORS, TRUSTEES OR BENEFICIARIES
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WHICH QUALIFY YOU AS BOX G OR H AND PROVIDE THE NAMES OF THOSE INDIVIDUALS.
PLEASE ATTACH A SEPARATE PAGE IF NECESSARY);
3. if the Subscriber is resident in Ontario, the Subscriber is (TICK ONE OR
MORE OF THE FOLLOWING BOXES):
[ ] (A) a founder of the Issuer;
[ ] (B) an affiliate of a founder of the Issuer;
[ ] (C) a spouse, parent, brother, sister, grandparent, grandchild or child of
an executive officer, director or founder of the Issuer;
[ ] (D) a control person of the Issuer; or
[ ] (E) an accredited investor;
4. if the Subscriber has checked box C in Section 3 above, the executive
officer, director or founder of the Issuer with whom the undersigned has
the relationship is:
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and the Subscriber has known such person for ________ years.
(INSTRUCTIONS TO SUBSCRIBER: FILL IN THE NAME OF EACH EXECUTIVE OFFICER,
DIRECTOR OR FOUNDER WHICH YOU HAVE THE ABOVE-MENTIONED RELATIONSHIP WITH.);
AND
5. if the Subscriber has ticked box F in Section 1 or box E in Section 3
above, the Subscriber satisfies one or more of the categories of
"accredited investor" (as that term is defined in NI 45-106) indicated
below (please check the appropriate box):
[ ] (a) an individual who either alone or with a spouse beneficially owns
financial assets (as defined in NI 45-106) having an aggregate
realizable value that before taxes, but net of any related
liabilities, exceeds CDN$1,000,000;
[ ] (b) an individual whose net income before taxes exceeded CDN$200,000 in
each of the two more recent calendar years or whose net income before
taxes combined with that of a spouse exceeded CDN$300,000 in each of
those years and who, in either case, reasonably expects to exceed that
net income level in the current calendar year;
[ ] (c) an individual who, either alone or with a spouse, has net assets of at
least CDN $5,000,000;
[ ] (d) a person, other than an individual or investment fund, that had net
assets of at least CDN$5,000,000 as reflected on its most recently
prepared financial statements.
[ ] (e) a person registered under securities legislation of a jurisdiction of
Canada as an advisor or dealer, or an individual registered or
formerly registered as a representative of such an adviser or dealer,
other than a limited market dealer registered under the SECURITIES ACT
(Ontario) or the SECURITIES ACT (Newfoundland);
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[ ] (f) an investment fund that distributes or has distributed its securities
only to: (i) persons that are or were accredited investors at the time
of distribution, (ii) persons that acquire or acquired securities in
the sections referred to in Sections 2.10 [MINIMUM AMOUNT INVESTMENT]
or 2.19 [ADDITIONAL INVESTMENT IN INVESTMENT FUNDS] of NI 45-106; or
(iii) persons described in (i) or (iii) that acquire or acquired
securities under Section 2.18 [INVESTMENT FUND REINVESTMENT] of NI
45-106; or
[ ] (g) a person in respect of which all of the owners of interests, direct,
indirect or beneficial, except the voting securities required by law
are persons or companies that are accredited investors.
The Subscriber acknowledges and agrees that the Subscriber may be required by
the Issuer to provide such additional documentation as may be reasonably
required by the Issuer and its legal counsel in determining the Subscriber's
eligibility to acquire the Securities under relevant legislation.
IN WITNESS WHEREOF, the undersigned has executed this Questionnaire as of the
______ day of ____________, 2012.
If an Individual: If a Corporation, Partnership or Other Entity:
X
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Signature Print or Type Name of Entity
X
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Print or Type Name Signature of Authorized Signatory
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Type of Entity
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EXHIBIT B
U.S. INVESTOR QUESTIONNAIRE
Capitalized terms used in this U.S. Investor Questionnaire (this
"QUESTIONNAIRE") and not specifically defined have the meaning ascribed to them
in the Private Placement Subscription Agreement between the Subscriber and the
Issuer to which this Exhibit B is attached.
This Questionnaire applies only to persons that are U.S. Purchasers. A "U.S.
PURCHASER" is (a) any "U.S. person" as defined in Regulation S under the 1933
Act, (b) any person purchasing the Shares on behalf of any "U.S. Person", (c)
any person that receives or received an offer of the Shares while in the United
States, (d) any person that is in the United States at the time the purchaser's
buy order was made or this Agreement was executed or delivered. "U.S. person"
includes but is not limited to (i) any natural person resident in the United
States; (ii) any partnership or corporation organized or incorporated under the
laws of the United States; (iii) any partnership or corporation organized
outside the United States by a U.S. person principally for the purpose of
investing in securities not registered under the 1933 Act, unless it is
organized or incorporated, and owned, by accredited investors who are not
natural persons, estates or trusts; or (iv) any estate or trust of which any
executor or administrator or trustee is a U.S. person.
The Subscriber understands and agrees that none of the Shares have been or will
be registered under the 1933 Act, or applicable state, provincial or foreign
securities laws, and the Shares are being offered and sold to the Subscriber in
reliance upon the exemption provided in Section 4(2) of the 1933 Act and Rule
506 of Regulation D under the 1933 Act for non-public offerings. The Shares are
being offered and sold within the United States only to "accredited investors"
as defined in Rule 501(a) of Regulation D. The Shares offered hereby are not
transferable except in accordance with the restrictions described herein.
The Subscriber represents, warrants and covenants (which representations,
warranties and covenants shall survive the Closing) to the Issuer (and
acknowledges that the Issuer is relying thereon) that:
1. it has such knowledge and experience in financial and business matters as
to be capable of evaluating the merits and risks of an investment in the
Shares and it is able to bear the economic risk of loss of its entire
investment;
2. the Issuer has provided to it the opportunity to ask questions and receive
answers concerning the terms and conditions of the Offering and it has had
access to such information concerning the Issuer as it has considered
necessary or appropriate in connection with its investment decision to
acquire the Shares;
3. it is acquiring the Shares for its own account, for investment purposes
only and not with a view to any resale, distribution or other disposition
of the Shares in violation of the United States securities laws;
4. it (i) has adequate net worth and means of providing for its current
financial needs and possible personal contingencies, (ii) has no need for
liquidity in this investment, and (iii) is able to bear the economic risks
of an investment in the Shares for an indefinite period of time;
5. if the Subscriber is an individual (that is, a natural person and not a
corporation, partnership, trust or other entity), then it satisfies one or
more of the categories indicated below (please place an "X" on the
appropriate lines):
______ a natural person whose individual net worth, or joint net worth with
that person's spouse, at the date of this Certification exceeds US
$1,000,000, excluding the value of the primary residence of such
person(s) and the related amount of indebtedness secured by the
primary residence up to its fair market value, or
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______ a natural person who had an individual income in excess of US $200,000
in each of the two most recent years or joint income with that
person's spouse in excess of US $300,000 in each of those years and
has a reasonable expectation of reaching the same income level in the
current year;
6. if the Subscriber is a corporation, partnership, trust or other entity),
then it satisfies one or more of the categories indicated below (please
place an "X" on the appropriate lines):
______ an organization described in Section 501(c)(3) of the United States
Internal Revenue Code, a corporation, a Massachusetts or similar
business trust or partnership, not formed for the specific purpose of
acquiring the Shares, with total assets in excess of US $5,000,000,
______ a "bank" as defined under Section (3)(a)(2) of the 1933 Act or savings
and loan association or other institution as defined in Section
3(a)(5)(A) of the 1933 Act acting in its individual or fiduciary
capacity; a broker dealer registered pursuant to Section 15 of the
SECURITIES EXCHANGE ACT OF 1934 (United States); an insurance company
as defined in Section 2(13) of the 1933 Act; an investment company
registered under the INVESTMENT COMPANY ACT OF 1940 (United States) or
a business development company as defined in Section 2(a)(48) of such
Act; 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 (United States); a plan with total
assets in excess of $5,000,000 established and maintained by a state,
a political subdivision thereof, or an agency or instrumentality of a
state or a political subdivision thereof, for the benefit of its
employees; an employee benefit plan within the meaning of the EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974 (United States) whose
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 if
the employee benefit plan has total assets in excess of $5,000,000,
or, if a self-directed plan, whose investment decisions are made
solely by persons that are accredited investors,
______ a private business development company as defined in Section
202(a)(22) of the INVESTMENT ▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇ ▇▇▇▇ (▇▇▇▇▇▇ ▇▇▇▇▇▇),
______ a director or executive officer of the Issuer,
______ a trust with total assets in excess of $5,000,000, not formed for the
specific purpose of acquiring the Shares, whose purchase is directed
by a sophisticated person as described in Rule 506(b)(2)(ii) under the
1933 Act, or
______ an entity in which all of the equity owners satisfy the requirements
of one or more of the foregoing categories;
7. it has not purchased the Shares as a result of any form of general
solicitation or general advertising, including advertisements, articles,
notices or other communications published in any newspaper, magazine or
similar media or broadcast over radio, internet, television or other form
of telecommunications, or any seminar or meeting whose attendees have been
invited by general solicitation or general advertising;
8. if the Subscriber decides to offer, sell or otherwise transfer any of the
Shares, it will not offer, sell or otherwise transfer any of such Shares
directly or indirectly, unless:
(a) the sale is to the Issuer,
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(b) the sale is made outside the United States in a transaction meeting
the requirements of Rule 904 of Regulation S under the 1933 Act and in
compliance with applicable local laws and regulations in which such
sale is made;
(c) the sale is made pursuant to the exemption from the registration
requirements under the 1933 Act provided by Rule 144 thereunder and in
accordance with any applicable state securities or "blue sky" laws, or
(d) the Shares are sold in a transaction that does not require
registration under the 1933 Act or any applicable state laws and
regulations governing the offer and sale of securities, and
(e) it has prior to such sale pursuant to subsection (c) or (d) furnished
to the Issuer an opinion of counsel of recognized standing reasonably
satisfactory to the Issuer, to such effect;
9. it understands and acknowledges that upon the issuance thereof, and until
such time as the same is no longer required under the applicable
requirements of the 1933 Act or applicable U.S. state laws and regulations,
the certificates representing the Shares, and all securities issued in
exchange therefor or in substitution thereof, will bear a legend in
substantially the following form:
"NONE OF THE SECURITIES REPRESENTED HEREBY HAVE BEEN
REGISTERED UNDER THE 1933 ACT, OR ANY U.S. STATE SECURITIES
LAWS, AND, UNLESS SO REGISTERED, NONE MAY BE OFFERED OR SOLD,
DIRECTLY OR INDIRECTLY, IN THE UNITED STATES OR TO U.S.
PERSONS (AS DEFINED HEREIN) EXCEPT IN ACCORDANCE WITH THE
PROVISIONS OF REGULATION S UNDER THE 1933 ACT, PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE 1933 ACT, OR
PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT
TO, THE REGISTRATION REQUIREMENTS OF THE 1933 ACT AND IN EACH
CASE ONLY IN ACCORDANCE WITH APPLICABLE SECURITIES LAWS."; and
10. it is resident in the United States of America, its territories and
possessions or any state of the United States or the District of Columbia
(collectively the "UNITED STATES"), a "U.S. PERSON" as such term is defined
in Regulation S of the 1933 Act or was in the United States at the time the
Shares were offered or the Agreement was executed.
[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK.
THE NEXT PAGE IS THE SIGNATURE PAGE]
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The Subscriber undertakes to notify the Issuer immediately of any change in any
representation, warranty or other information relating to the Subscriber set
forth in this Questionnaire which takes place prior to the closing time of the
purchase and sale of the Shares.
Dated , 2012.
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X
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Signature of individual (if Subscriber is an
individual)
X
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Authorized signatory (if Subscriber is not an
individual)
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Name of Subscriber (please print)
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Name of authorized signatory (please print)
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Phone Number
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