SUBSCRIPTION AGREEMENT (Mezzanine Financing) For the Private Placement of Common Shares of AFRICO RESOURCES LTD.
(Mezzanine
Financing)
For
the
Private Placement of Common Shares
of
AFRICO
RESOURCES LTD.
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THIS
AGREEMENT, as of the acceptance date set forth below, is
between:
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AFRICO
RESOURCES LTD.,
a
British Columbia company with an address of Suite 1540 - ▇▇▇
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▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇,
▇▇▇ ▇▇▇
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(the
“Issuer”)
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AND
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RUBICON
MINERALS CORPORATION
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Full
Name of Subscriber
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Suite
1540 - ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇ ▇▇▇
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Address
of Subscriber
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(the
“Subscriber”)
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Registration
Particulars (if different from above
address)
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INSTRUCTIONS
FOR SUBSCRIBERS
All
Subscribers:
Complete
the name, address and registration information at page 1 above (if
not
already filled in) and complete and sign page of
this Subscription Agreement.
Courier
your originally executed copy of this Subscription Agreement, together
with a cheque made payable to “Africo Resources Ltd.” for the subscription
proceeds, to Africo Resources Ltd., attention ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, at
the
Issuer’s address set out above.
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| 1. |
Subscription
and Consideration
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The
Subscriber hereby subscribes for and agrees to purchase 1,420,000 common shares
in the capital of the Issuer (the “Securities”) at a price of CAD$1.50 per
common share for an aggregate purchase amount (the “Purchase Price”) of
CAD$2,130,000.
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| 2. |
Representations
and Warranties of the
Issuer
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The
Issuer represents and warrants that:
| (a) |
the
Issuer has the full power and authority to enter into and perform
this
Agreement and to do all other acts which may be necessary to consummate
the transactions contemplated
hereby;
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| (b) |
the
issue of the Securities will, at the time of their issuance, have
been
approved by all requisite corporate action of the Issuer and the
Securities will, upon issue and delivery, be validly issued as fully
paid
and non-assessable common shares in the capital of the
Issuer;
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| (c) |
it
is a “private issuer” as such term is defined in Canadian Securities
Administrators Multilateral Instrument 45-103, “Capital Raising
Exemptions” (“MI 45-103”)”,
namely:
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| (i) |
it
is not a reporting issuer, a mutual fund or a non-redeemable investment
fund,
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| (ii) |
its
designated securities
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| A. |
are
subject to restrictions on transfer that are contained in the Issuer’s
constating documents or security holders’ agreements,
and
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| B. |
are
beneficially owned, directly or indirectly, by not more than 50 persons
or
companies, counting any two or more joint registered owners as one
beneficial owner, and not counting employees and former employees
of the
Issuer or its affiliates, and
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| (iii) |
it
has distributed designated securities only to persons or companies
described in section 2.1(1) of MI 45-103;
and
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| (d) |
to
the best of the Issuer’s knowledge, no commission or finder’s fee has been
paid to any director, officer, founder or control person of the Issuer
in
connection with the sale of the Securities, except if the Subscriber
is an
accredited investor.
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| 3. |
Representations,
Warranties, Acknowledgements and Covenants of the
Subscriber
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The
Subscriber represents, warrants, acknowledges and covenants that:
| (a) |
the
Subscriber is purchasing the Securities as principal, and not on
behalf
of, or with the intention of reselling any of the Securities to,
any other
person, and the Subscriber is a current holder of common shares in
the
capital of the Issuer;
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| (b) |
the
Subscriber has the legal capacity and competence to enter into and
execute
this Agreement and to take all actions required pursuant
hereto;
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| (c) |
the
entering into of this Agreement and the transactions contemplated
hereby
will not result in the violation of any of the terms and provisions
of any
law applicable to the Subscriber or of any agreement, written or
oral, to
which the Subscriber may be a part or by which the Subscriber is
or may be
bound;
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| (d) |
this
Agreement has been duly executed and delivered by the Subscriber
and
constitutes a legal, valid and binding agreement of the Subscriber,
enforceable against the Subscriber in accordance with its
terms;
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| (e) |
the
Subscriber has been independently advised as to the restrictions
with
respect to trading and the applicable resale restrictions imposed
in
respect of the Securities by securities legislation in the jurisdiction
in
which the Subscriber resides and confirms that no representation
has been
made respecting the restrictions with respect to trading and the
applicable resale restrictions relating to the Securities and is
aware of
the risks and other characteristics of the Securities and of the
fact that
the Subscriber may not resell the Securities except in accordance
with the
applicable securities legislation and regulatory
policies;
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| (f) |
the
Subscriber acknowledges that an investment in the Securities is subject
to
a number of risk factors. In particular, the Subscriber acknowledges
that
the Issuer is not currently a “reporting issuer” under applicable Canadian
securities legislation and therefore the applicable hold period with
respect to the Securities may never expire. Accordingly, there is
currently no market for the Securities and one may never develop.
It may
be difficult or even impossible for the Subscriber to sell the Securities.
Resale of the Securities will require the availability of exemptions
from
the registration and prospectus requirements of applicable securities
legislation, or the application for a discretionary order of a securities
commission or similar regulatory authority permitting the trade.
The
Subscriber covenants and agrees to comply with any applicable securities
legislation, and any other relevant securities orders or policies
concerning the purchase, holding and resale of the
Securities;
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| (g) |
the
Subscriber is resident in the jurisdiction set out on page 1
of this
Agreement;
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| (h) |
to
the best of the Subscriber’s knowledge, the sale of the Securities was not
advertised;
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| (i) |
the
Subscriber acknowledges that the Securities have not been registered
under
the United States Securities Act of 1933, as amended (the “1933 Act”) and
may not be offered or sold in the United States unless registered
under
the 1933 Act and the securities laws of all applicable states of
the
United States or an exemption from such registration requirements
is
available, and that the Issuer has no obligation or present intention
of
filing a registration statement under the 1933 Act in respect of
the
Securities;
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| (j) |
the
Subscriber acknowledges and agrees that the offer to purchase the
Securities was not made to the Subscriber when the Subscriber was
in the
United States and at the time the Subscriber’s subscription was delivered
to the Issuer, the Subscriber was outside the United States and that:
(i)
the Subscriber is not and will not be purchasing the Securities for
the
account or benefit of any U.S. Person (as such term is defined in
Regulation S promulgated under the ▇▇▇▇ ▇▇▇); and (ii) the
Subscriber
is not a U.S. Person;
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| (k) |
no
securities commission or similar regulatory authority has reviewed
or
passed on the merits of the
Securities;
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| (l) |
there
is no government or other insurance covering the
Securities;
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| (m) |
there
are risks associated with the purchase of the
Securities;
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| (n) |
there
are restrictions on the Subscriber’s ability to resell the Securities and
it is the responsibility of the Subscriber to find out what those
restrictions are and to comply with them before selling the
Securities;
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| (o) |
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 securities through a person registered to
sell
securities under the Securities
Act
(British Columbia) (the “Act”) and, as a consequence of acquiring
securities pursuant to this exemption, certain protections, rights
and
remedies provided by the Act, including statutory rights of rescission
or
damages, will not be available to the
Subscriber;
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| (p) |
the
Subscriber has not received or been provided with a prospectus, offering
memorandum or similar document and the decision to enter into this
agreement and to purchase the Securities has not been based upon
any
verbal or written representations as to fact or otherwise made by
or on
behalf of the Issuer;
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| (q) |
it
will immediately notify the Issuer if any of its representations
and
warranties contained herein would be inaccurate if made after the
date
hereof but on or before the closing
date;
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| (r) |
no
person has made any written or oral representations to the
Subscriber:
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| (i) |
that
any person will resell or repurchase the
Securities;
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| (ii) |
that
any person will refund the purchase price of the
Securities;
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| (iii) |
as
to the future price or value of the Securities;
or
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that
the Securities will be listed and posted for trading on a stock
exchange
or quoted on any quotation and trade reporting system, or that
application
has been made or will be made, to list and post the Securities
for trading
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on
a stock exchange or quote the Securities on any quotation and trade
reporting system;
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| (s) |
the
Subscriber acknowledges that it has been encouraged to obtain independent
legal, income tax and investment advice with respect to its purchase
of
the Securities and accordingly, has had the opportunity to acquire
an
understanding of the meanings of all terms contained herein relevant
to
the Subscriber for purposes of giving representations, warranties,
acknowledgements and covenants under this Agreement;
and
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| (t) |
the
funds representing the Purchase Price which will be advanced by the
Subscriber to the Issuer hereunder will not represent proceeds of
crime
for the purposes of the Proceeds
of Crime (Money Laundering) Act
(Canada) (the “PCMLA”) and the Subscriber acknowledges that the Issuer may
in the future be required by law to disclose the Subscriber’s name and
other information relating to this Agreement and the purchase hereunder,
on a confidential basis, pursuant to the PCMLA. To the best of the
Subscriber’s knowledge none of the funds representing the Purchase Price
to be provided by the Subscriber (i) have been or will be
derived
from or related to any activity that is deemed criminal under the
law of
Canada, the United States of America, or any other jurisdiction,
or
(ii) are being tendered on behalf of a person or entity who
has not
been identified to the Subscriber. The Subscriber shall promptly
notify
the Issuer if the Subscriber discovers that any of such representations
ceases to be true, and shall provide the Issuer with appropriate
information in connection
therewith.
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| 4. |
Further
Assurances
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The
parties hereto covenant and agree to execute and deliver such further agreements
and documents and to provide such further assurances as may be required by
either party to give effect to this Agreement and, without limiting the
generality of the foregoing, to do all acts and things, execute and deliver
all
documents, agreements and writings and provide such assurances, undertakings
and
information as may be required from time to time by all regulatory or
governmental bodies or stock exchanges having jurisdiction over the Issuer’s
affairs.
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Compliance
and Cooperation with Regulatory
Requirements
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The
Subscriber agrees to abide by any requirements respecting the Securities,
including any mandatory pooling or escrow requirements, imposed by the British
Columbia Securities Commission (the “Commission”) and any other regulatory
authority having jurisdiction over the Issuer (including any stock exchange)
and
agrees to duly execute and deliver to the Issuer now or in the future all such
other documents or instruments as may be necessary to implement and carry out
the terms of this Agreement (including, if required, a replacement, substitute
or amended subscription agreement).
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| 6. |
Closing
Date
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The
Closing Date will be such date following acceptance of this Agreement by the
Issuer as is determined by the Issuer, acting reasonably.
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Time
of Closing
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Time
of
Closing means 10:00 a.m. (Vancouver time) on the Closing Date, or such other
time on the Closing Date as may be determined by the Issuer, acting
reasonably.
| 8. |
Condition
Precedent
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The
obligation of the Issuer to carry out the terms of this Agreement and to issue
the Securities to the Subscriber is subject to the following condition in favour
of the Issuer, which condition may be waived in whole or in part by the Issuer
at its discretion:
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that
on the Closing Date, the representations, warranties, acknowledgements
and
covenants of the Subscriber as set forth in section 3
of
this Agreement are true and have been fulfilled in every particular
way as
if such representations, warranties, acknowledgements and covenants
had
been made by the Subscriber on the Closing
Date.
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| 9. |
Closing
and Payment of Purchase
Price
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The
total
Purchase Price will be paid by cheque to the Issuer upon the execution of this
Agreement, and will be held in trust by the Issuer until the Time of Closing
on
the Closing Date. At the Time of Closing, the Issuer will deliver to the
Subscriber a share certificate, representing the Securities, against payment
of
the Purchase Price by the Subscriber to the Issuer.
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Counterparts
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This
Agreement may be executed by facsimile and in as many counterparts as may be
necessary, and each of such counterparts so executed will be deemed to be an
original and such counterparts together will constitute one and the same
instrument.
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| 11. |
Governing
Law
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This
Agreement is deemed to have been made in British Columbia and will be governed
and construed exclusively in accordance with the laws of British Columbia and
the laws of Canada applicable in that province.
DATED
the
18th day of April, 2005.
Signature
of Subscriber (or authorized
signing
officer if Subscriber is not
an
individual)
”▇▇▇▇▇
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Print
Name of Subscriber: (name of corporation or other entity if
Subscriber
is
not
an
individual)
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Rubicon
Minerals Corporation
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If
Subscriber is not
an
individual, name and title of signatory:
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▇▇▇▇▇
▇▇▇▇▇▇▇ - President & CEO
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ACCEPTED
on the 21st day of April, 2005.
AFRICO
RESOURCES LTD.
By: “▇▇▇▇▇
▇▇▇▇▇▇▇”
Authorized
Signatory
Name:
Title: