Corporation’s Covenants. The Corporation hereby covenants to the Underwriters and to the Purchasers and their permitted assigns, and acknowledges that each of them is relying on such covenants in purchasing the Special Warrants, that the Corporation shall: (a) prior to the Closing Time and at all times until a Final Receipt is issued, allow the Underwriters (and their counsel and consultants) to conduct all due diligence which the Underwriters may reasonably require or which may be considered necessary or appropriate by the Underwriters. The Corporation will provide to the Underwriters (and their counsel) reasonable access to the Corporation’s senior management personnel and corporate, financial and other records, for the purposes of conducting such due diligence. Without limiting the scope of the due diligence inquiry that the Underwriters (or their counsel) may conduct, the Corporation shall also make available its directors, senior management, the Chairman of the Audit Committee of the Board of Directors, the auditors and counsel to answer any questions which the Underwriters may have and to participate in one or more due diligence sessions to be held prior to Closing and, prior to filing each of the Preliminary Prospectus and Final Prospectus and to use its commercial best efforts to arrange for the auditors of the Corporation to participate in any such due diligence session; (b) duly execute the Subscription Agreements which have been duly completed by the Purchasers subject to the terms thereof, and duly and punctually perform all the obligations to be performed by it under this Agreement and the Subscription Agreements; (c) use its commercial best efforts to fulfil or cause to be fulfilled, at or prior to the Closing Date, each of the conditions required to be fulfilled by it set out in section 7 hereof; (d) use its commercial best efforts to obtain the necessary approval of the TSXV for the Offering and the listing of the Underlying Securities on such terms as are customary; (e) file with the Canadian Securities Regulators and the TSXV all forms, notices and certificates required to be filed by the Corporation pursuant to the Canadian Securities Laws and the policies of the TSXV in the time required by the Canadian Securities Laws and the policies of the TSXV, including, for greater certainty, Form 45-106F1 of NI 45-106 and any other forms, notices and certificates set forth in the opinions delivered to the Underwriters pursuant to the closing conditions set forth in section 7 hereof, as are required to be filed by the Corporation; (f) ensure that the Underlying Shares, upon issuance, shall be duly issued as fully paid and non-assessable Common Shares, and shall have the attributes corresponding in all material respects to the description thereof set forth in this Agreement and the Subscription Agreements; (g) fulfil all legal requirements to permit the creation, issuance, offering and sale of the Special Warrants and the Underlying Securities, all as contemplated in this Agreement and file or cause to be filed all documents, applications, forms or undertakings required to be filed by the Corporation and take or cause to be taken all action required to be taken by the Corporation in connection with the purchase and sale of the Special Warrants and the issuance of the Qualified Securities, so that the distribution of the Qualified Securities may lawfully occur without the necessity of filing a registration statement in the United States or similar document in any other jurisdiction; (h) until the date of the completion of the distribution of the Qualified Securities, use commercial best efforts to ensure the Prospectus complies at all times with Canadian Securities Laws; (i) during the period from the date hereof until the date of the completion of the distribution of the Qualified Securities, promptly inform the Underwriters of the full particulars of any request of any Securities Regulator for any information, or the receipt by the Corporation of any communication from any Securities Regulator or any other competent authority relating to the Corporation or which may be relevant to the distribution of the Qualified Securities; (j) apply the net proceeds from the Offering to fund the Acquisition; (k) comply with each of the covenants of the Corporation set out in the Subscription Agreements; (l) advise the Underwriters, promptly after receiving notice thereof, of the time when the Preliminary Prospectus, the Final Prospectus and any Supplementary Material have been filed and receipts therefor have been obtained pursuant to NP 11-202 and will provide evidence reasonably satisfactory to the Underwriters of each such filing and copies of such receipts; (m) advise the Underwriters, promptly after receiving notice or obtaining knowledge thereof, of: (i) the issuance by any Canadian Securities Regulator of any order suspending or preventing the use of the Prospectus or any Supplementary Material; (ii) the institution, threatening or contemplation of any proceeding for any such purposes; (iii) any order, ruling, or determination having the effect of suspending the sale or ceasing the trading in any securities of the Corporation (including the Special Warrants or the Underlying Securities) having been issued by any Canadian Securities Regulator or the institution, threatening or contemplation of any proceeding for any such purposes; or (iv) any requests made by any Canadian Securities Regulators to amend or supplement the Prospectus or to provide additional information, and will use its commercial best efforts to prevent the issuance of any order referred to in (i) above and, if any such order is issued, to obtain the withdrawal thereof as quickly as possible; (n) except to the extent the Corporation participates in a merger or business combination transaction which is in the best interest of the Corporation and following which the Corporation is not a “reporting issuer”, use its commercial best efforts to maintain its status as a “reporting issuer” (or the equivalent thereof) not in default of the requirements of Canadian Securities Laws of each of the Canadian jurisdictions in which it is currently a reporting issuer, which have such a concept to the date which is two years following the Closing Date; and (o) except to the extent the Corporation participates in a merger or business combination transaction which is in the best interest of the Corporation and following which the Corporation is not listed on the TSXV or the TSX, use its commercial best efforts to maintain the listing of: (i) the Common Shares on the TSXV or the TSX or such other recognized stock exchange or quotation system as Canaccord Genuity, on behalf of the Underwriters, may approve, acting reasonably, to the date that is two years following the Closing Date; and (ii) the Convertible Debentures and the Warrants on the TSXV or the TSX or such other recognized stock exchange or quotation system as Canaccord Genuity, on behalf of the Underwriters, may approve, acting reasonably, until the Maturity Date or Expiry Date, as applicable. The Corporation further hereby covenants to the Underwriters and to the Purchasers and their permitted assigns, and acknowledges that each of them is relying on such covenants in purchasing the Special Warrants, that following the Closing: (p) the Corporation shall qualify the distribution of the Qualified Securities in the Qualifying Provinces to holders of the Special Warrants and file the Preliminary Prospectus in each of the Qualifying Provinces as soon as possible following the Closing Date and the Final Prospectus promptly following receipt and settlement of comments from the Canadian Securities Regulators; (q) the Corporation shall use its commercial best efforts to: satisfy all comments with respect to the Preliminary Prospectus; prepare and file the Final Prospectus under Canadian Securities Laws; obtain the Final Receipt (in accordance with the procedures of prospectus review in multiple jurisdictions provided for under NP 11-202), and take all other steps and proceedings that may be necessary to be taken by the Corporation in order to qualify the Qualified Securities for distribution in each of the Qualifying Provinces under Canadian Securities Laws, as soon as practicable following the Closing Date and, in any event, prior to the Qualification Deadline; (r) the Corporation shall allow the Underwriters to participate in the preparation of the Prospectus and any Supplementary Material that the Corporation is required to file under Canadian Securities Laws relating to the Offering; (s) the delivery of the Final Prospectus and any Supplementary Material to the Underwriters by the Corporation in accordance with this Agreement will constitute the representation and warranty of the Corporation to the Underwriters that (except for information and statements relating solely to the Underwriters and furnished by them specifically for use in the Final Prospectus), at the respective times of delivery: (i) the information and statements contained in each of the Final Prospectus and any Supplementary Material: (A) are true and correct and contain no misrepresentation; and (B) constitute full, true and plain disclosure of all material facts relating to the Qualified Securities and the Corporation considered as a whole; (ii) no material fact has been omitted from any of the Final Prospectus and any Supplementary Material that is required to be stated in the document or is necessary to make the statements therein not misleading in the light of the circumstances in which they were made; and (iii) the Final Prospectus and the Supplementary Material comply in all material respects with Canadian Securities Laws; (t) the Corporation will deliver to the Underwriters, without charge, contemporaneously with, or prior to the filing of, the Final Prospectus, unless otherwise indicated: (i) a copy of any document filed with, or delivered to, the Canadian Securities Regulators by the Corporation under Canadian Securities Laws with the Final Prospectus; (ii) a certificate dated the date of the Final Prospectus, addressed to the Underwriters and signed by the Chief Executive Officer and Chief Financial Officer of the Corporation, certifying for and on behalf of the Corporation, and not in their personal capacities, after having made due inquiries, with respect to the following matters: (A) the Corporation having complied with all of the covenants and satisfied all of the terms and conditions of this Agreement on its part to be complied with and satisfied at or prior to the date of the Final Prospectus; (B) no order, ruling or determination having the effect of ceasing or suspending trading in any securities of the Corporation or prohibiting the issue of the Special Warrants or the Underlying Securities or any of the Corporation’s issued securities having been issued and no proceeding for such purpose being pending or, to the knowledge of such officers, threatened; (C) the representations and warranties of the Corporation contained in this Agreement and in any certificates of Corporation delivered pursuant to or in connection with this Agreement being true and correct as at the date of the Final Prospectus, with the same force and effect as if made on and as at the date of the Final Prospectus, after giving effect to the transactions contemplated by this Agreement; and (D) since the Closing Time, there having been no material adverse change, financial or otherwise, in the assets, liabilities (contingent or otherwise), capital, business or results of operations of the Corporation; (u) the Corporation shall deliver opinions, comfort letters and other documents substantially similar to those referred to in this section 1 to Canaccord Genuity and the Underwriters’ counsel, as applicable, with respect to any Supplementary Material, contemporaneously with, or prior to the filing of, any Supplementary Material; (v) until the earlier of the Qualification Date and the Qualification Deadline, the Corporation shall deliver to the Underwriters copies of all correspondence and other written communications between the Corporation and any Securities Regulators or other Governmental Authority relating to the Offering and the Acquisition and will generally keep the Underwriters apprised of the status of, including all developments relating to, the Offering, the Acquisition, and satisfaction of closing conditions for the Acquisition and the Release Conditions; (w) the Corporation shall comply with and satisfy, in all material respects, all terms, conditions and covenants in the Offer to Purchase; (x) the Corporation shall use its commercial best efforts to satisfy the Release Conditions prior to the Release Deadline, including seeking any extensions or waivers necessary to keep the Offer to Purchase in full force and effect until the Qualification Deadline as necessary; (y) the Corporation shall use its commercial best efforts to enforce its rights against CryptoLogic and its affiliates under the Offer to Purchase; (z) the Corporation shall notify Canaccord Genuity in writing of the receipt of all regulatory approvals required to complete the Acquisition; (aa) as a condition precedent to the execution of the joint notice by Canaccord Genuity with the Corporation in respect of the Release Event pursuant to the Release Conditions, the Chief Executive Officer of the Corporation shall have delivered to Canaccord Genuity a certification that all conditions to the completion of the Acquisition by the Corporation, on terms previously disclosed to or otherwise reasonably acceptable to Canaccord Genuity, have been satisfied or waived; and (bb) in the event that the Release Event does not occur on or before the Release Deadline, the Corporation shall forthwith deliver a notice to each of the Special Warrant holders and the Agent and the Agent shall return, within three Business Days, to each such holder the applicable subscription amount, plus any interest earned thereon, less applicable withholding taxes, if any, and the Special Warrants shall be cancelled. The Corporation shall be responsible for any shortfall in the aggregate subscription amount payable to Special Warrant holders.
Appears in 2 contracts
Samples: Underwriting Agreement (Amaya Gaming Group Inc.), Underwriting Agreement (Amaya Gaming Group Inc.)
Corporation’s Covenants. The Corporation hereby covenants to the Underwriters Underwriter and to the Purchasers and their its permitted assigns, and acknowledges that each of them it is relying on such covenants in purchasing the Special WarrantsUnits, that the Corporation shall:
(a) prior to the Closing Time and at all times until a Final Receipt is issuedTime, allow the Underwriters Underwriter (and their counsel its counsel, consultants and consultantsother representatives) to conduct all due diligence investigations which the Underwriters Underwriter may reasonably require or which may be considered consider necessary or appropriate by in order to fulfill the UnderwritersUnderwriter’s obligations as a registrant to complete the Offering as provided herein. The Corporation will provide to the Underwriters Underwriter (and their counselits counsel and consultants) reasonable access to the Corporation’s properties (if any), senior management personnel and corporate, financial and other records, for the purposes of conducting such due diligence. Without limiting the scope of the due diligence inquiry that the Underwriters Underwriter (or their counselits counsel and consultants) may conduct, the Corporation shall also make available its directors, senior management, the Chairman of the Audit Committee of the Board of Directors, the counsel and auditors and counsel to answer any questions which the Underwriters Underwriter may have and to participate in one or more due diligence sessions to be held prior to Closing and, prior to filing each of the Preliminary Prospectus and Final Prospectus and to use its commercial best efforts to arrange for the auditors of the Corporation to participate in any such due diligence sessionClosing;
(b) duly execute the Subscription Agreements which have been duly completed by the Substituted Purchasers subject to the terms thereofand duly, punctually and duly and punctually faithfully perform all the obligations to be performed by it under this Agreement and the Subscription Agreements;
(c) use its commercial best commercially reasonable efforts to fulfil or cause to be fulfilled, at or prior to the Closing Date, each of the conditions required to be fulfilled by it set out in section 7 hereofSection 7;
(d) use its commercial best efforts to obtain the necessary approval of the TSXV for the Offering and the listing of the Underlying Securities on such terms as are customary;
(e) file with the Canadian Securities Regulators and the TSXV all forms, notices and certificates required to be filed by the Corporation pursuant to the Canadian Securities Laws and the policies of the TSXV in the time required by the Canadian Securities Laws and the policies of the TSXV, including, for greater certainty, Form 45-106F1 of NI 45-106 and any other forms, notices and certificates set forth in the opinions delivered to the Underwriters pursuant to the closing conditions set forth in section 7 hereof, as are required to be filed by the Corporation;
(f) ensure that the Underlying Shares, upon issuance, shall be duly issued as fully paid and non-assessable Common Shares, and shall have the attributes corresponding in all material respects to the description thereof set forth in this Agreement and the Subscription Agreements;
(g) fulfil all legal requirements to permit the creation, issuance, offering and sale of the Special Warrants and the Underlying Securities, all as contemplated in this Agreement and file or cause to be filed all documents, applications, forms or undertakings required to be filed by the Corporation and take or cause to be taken all action required to be taken by the Corporation in connection with the purchase and sale of the Special Warrants and the issuance of the Qualified SecuritiesUnits and, so that the distribution of the Qualified Securities Units may lawfully occur without the necessity of filing a registration statement prospectus in the United States Canada or similar document in any other jurisdiction;
(he) until file or cause to be filed all documents, applications, forms or undertakings with the date of TSXV and any other applicable regulating authority in connection with the completion of the distribution of the Qualified Securities, use commercial best efforts Offering to ensure the Prospectus complies Common Shares and the Common Shares underlying the Warrants are conditionally approved for listing on the TSXV at all times with Canadian Securities LawsClosing;
(if) during the period from commencing with the date hereof until and ending on the date of the completion of the distribution of the Qualified SecuritiesClosing Date, promptly inform the Underwriters Underwriter of the full particulars of any request of any Securities Regulator Commission or other securities commission or similar regulatory authority for any information, or the receipt by the Corporation of any communication from any Securities Regulator Commission or other securities regulatory authority, or any other competent authority relating to the Corporation or which may be relevant to the distribution of the Qualified SecuritiesUnits;
(jg) promptly comply, to the reasonable satisfaction of the Underwriter and the Underwriter’s Counsel, with the Applicable Securities Laws with respect to any material adverse change, change, occurrence or event of the nature referred to in paragraph 2(e) above;
(h) apply the net proceeds from the Offering to fund in accordance with the Acquisition;
(k) comply with each of description set forth in the covenants press release of the Corporation set out in the Subscription Agreements;
(l) advise the Underwritersdated April 20, promptly after receiving notice thereof, of the time when the Preliminary Prospectus, the Final Prospectus and any Supplementary Material have been filed and receipts therefor have been obtained pursuant to NP 11-202 and will provide evidence reasonably satisfactory to the Underwriters of each such filing and copies of such receipts;
(m) advise the Underwriters, promptly after receiving notice or obtaining knowledge thereof, of:2007; and
(i) shall not offer, issue or sell, announce any offer, issuance or sale of, or negotiate or enter into any agreement to issue or sell, directly or indirectly, any Common Shares (including securities convertible or exchangeable into Common Shares) for a period of 180 days from the issuance by any Canadian Securities Regulator of any order suspending or preventing Closing Date, other than (i) pursuant to the use of the Prospectus or any Supplementary Material;
Offering, (ii) the institution, threatening or contemplation upon exercise of any proceeding for any such purposes;
(iii) any orderconvertible securities, ruling, options or determination having the effect of suspending the sale or ceasing the trading in any securities warrants of the Corporation (including the Special Warrants or the Underlying Securities) having been issued by any Canadian Securities Regulator or the institution, threatening or contemplation of any proceeding for any such purposes; or
(iv) any requests made by any Canadian Securities Regulators to amend or supplement the Prospectus or to provide additional information, and will use its commercial best efforts to prevent the issuance of any order referred to in (i) above and, if any such order is issued, to obtain the withdrawal thereof as quickly as possible;
(n) except to the extent the Corporation participates in a merger or business combination transaction which is in the best interest of the Corporation and following which the Corporation is not a “reporting issuer”, use its commercial best efforts to maintain its status as a “reporting issuer” (or the equivalent thereof) not in default of the requirements of Canadian Securities Laws of each of the Canadian jurisdictions in which it is currently a reporting issuer, which have such a concept to outstanding on the date which is two years following the Closing Date; and
(o) except to the extent the Corporation participates in a merger or business combination transaction which is in the best interest of the Corporation and following which the Corporation is not listed on the TSXV or the TSXhereof, use its commercial best efforts to maintain the listing of:
(i) the Common Shares on the TSXV or the TSX or such other recognized stock exchange or quotation system as Canaccord Genuity, on behalf of the Underwriters, may approve, acting reasonably, to the date that is two years following the Closing Date; and
(ii) the Convertible Debentures and the Warrants on the TSXV or the TSX or such other recognized stock exchange or quotation system as Canaccord Genuity, on behalf of the Underwriters, may approve, acting reasonably, until the Maturity Date or Expiry Date, as applicable. The Corporation further hereby covenants to the Underwriters and to the Purchasers and their permitted assigns, and acknowledges that each of them is relying on such covenants in purchasing the Special Warrants, that following the Closing:
(p) the Corporation shall qualify the distribution of the Qualified Securities in the Qualifying Provinces to holders of the Special Warrants and file the Preliminary Prospectus in each of the Qualifying Provinces as soon as possible following the Closing Date and the Final Prospectus promptly following receipt and settlement of comments from the Canadian Securities Regulators;
(q) the Corporation shall use its commercial best efforts to: satisfy all comments with respect to the Preliminary Prospectus; prepare and file the Final Prospectus under Canadian Securities Laws; obtain the Final Receipt (in accordance with the procedures of prospectus review in multiple jurisdictions provided for under NP 11-202), and take all other steps and proceedings that may be necessary to be taken by the Corporation in order to qualify the Qualified Securities for distribution in each of the Qualifying Provinces under Canadian Securities Laws, as soon as practicable following the Closing Date and, in any event, prior to the Qualification Deadline;
(r) the Corporation shall allow the Underwriters to participate in the preparation of the Prospectus and any Supplementary Material that the Corporation is required to file under Canadian Securities Laws relating to the Offering;
(s) the delivery of the Final Prospectus and any Supplementary Material to the Underwriters by the Corporation in accordance with this Agreement will constitute the representation and warranty of the Corporation to the Underwriters that (except for information and statements relating solely to the Underwriters and furnished by them specifically for use in the Final Prospectus), at the respective times of delivery:
(i) the information and statements contained in each of the Final Prospectus and any Supplementary Material:
(A) are true and correct and contain no misrepresentation; and
(B) constitute full, true and plain disclosure of all material facts relating to the Qualified Securities and the Corporation considered as a whole;
(ii) no material fact has been omitted from any of the Final Prospectus and any Supplementary Material that is required to be stated in the document or is necessary to make the statements therein not misleading in the light of the circumstances in which they were made; and
(iii) the Final Prospectus and the Supplementary Material comply in all material respects with Canadian Securities Laws;
(t) the Corporation will deliver grant or exercise of options pursuant to the Underwriters, without charge, contemporaneously with, or prior to the filing of, the Final Prospectus, unless otherwise indicated:
(i) a copy of any document filed with, or delivered to, the Canadian Securities Regulators by the Corporation under Canadian Securities Laws with the Final Prospectus;
(ii) a certificate dated the date of the Final Prospectus, addressed to the Underwriters and signed by the Chief Executive Officer and Chief Financial Officer of the Corporation, certifying for and on behalf of the Corporation, and not in their personal capacities, after having made due inquiries, with respect to the following matters:
(A) the Corporation having complied with all of the covenants and satisfied all of the terms and conditions of this Agreement on its part to be complied with and satisfied at or prior to the date of the Final Prospectus;
(B) no order, ruling or determination having the effect of ceasing or suspending trading in any securities of the Corporation or prohibiting the issue of the Special Warrants or the Underlying Securities or any of the Corporation’s issued securities having been issued and no proceeding for such purpose being pending or, to the knowledge of such officers, threatened;
(C) the representations and warranties of the Corporation contained in this Agreement and in any certificates of Corporation delivered pursuant to or in connection with this Agreement being true and correct as at the date of the Final Prospectus, with the same force and effect as if made on and as at the date of the Final Prospectus, after giving effect to the transactions contemplated by this Agreement; and
(D) since the Closing Time, there having been no material adverse change, financial or otherwise, in the assets, liabilities (contingent or otherwise), capital, business or results of operations of the Corporation;
(u) the Corporation shall deliver opinions, comfort letters and other documents substantially similar to those referred to in this section 1 to Canaccord Genuity and the Underwriters’ counsel, as applicable, with respect to any Supplementary Material, contemporaneously with, or prior to the filing of, any Supplementary Material;
(v) until the earlier of the Qualification Date and the Qualification Deadline, the Corporation shall deliver to the Underwriters copies of all correspondence and other written communications between the Corporation and any Securities Regulators or other Governmental Authority relating to the Offering and the Acquisition and will generally keep the Underwriters apprised of the status of, including all developments relating to, the Offering, the Acquisitionexisting stock option plan, and satisfaction of closing conditions for the Acquisition and the Release Conditions;
(w) the Corporation shall comply with and satisfy, in all material respects, all terms, conditions and covenants in the Offer to Purchase;
(x) the Corporation shall use its commercial best efforts to satisfy the Release Conditions prior to the Release Deadline, including seeking any extensions or waivers necessary to keep the Offer to Purchase in full force and effect until the Qualification Deadline as necessary;
(y) the Corporation shall use its commercial best efforts to enforce its rights against CryptoLogic and its affiliates under the Offer to Purchase;
(z) the Corporation shall notify Canaccord Genuity in writing of the receipt of all regulatory approvals required to complete the Acquisition;
(aaiv) as a condition precedent to the execution result of the joint notice by Canaccord Genuity acquisition of shares or assets of a Person acting at arm’s length with the Corporation in respect within the meaning of the Release Event pursuant to Income Tax Act (Canada) without the Release Conditions, the Chief Executive Officer prior written consent of the Corporation Underwriter which shall have delivered to Canaccord Genuity a certification that all conditions to the completion of the Acquisition by the Corporation, on terms previously disclosed to not be unreasonably withheld or otherwise reasonably acceptable to Canaccord Genuity, have been satisfied or waived; and
(bb) in the event that the Release Event does not occur on or before the Release Deadline, the Corporation shall forthwith deliver a notice to each of the Special Warrant holders and the Agent and the Agent shall return, within three Business Days, to each such holder the applicable subscription amount, plus any interest earned thereon, less applicable withholding taxes, if any, and the Special Warrants shall be cancelled. The Corporation shall be responsible for any shortfall in the aggregate subscription amount payable to Special Warrant holdersdelayed.
Appears in 2 contracts
Samples: Underwriting Agreement (Sonic Environmental Solutions Inc/Can), Underwriting Agreement (Sonic Technology Solutions Inc.)
Corporation’s Covenants. The Corporation hereby covenants to the Underwriters and to the Purchasers and their permitted assigns, and acknowledges that each of them is relying on such covenants in purchasing the Special Warrants, that the Corporation shallagrees:
(a) prior to the Closing Time and at all times until a Final Receipt is issued, allow the Underwriters (and their counsel and consultants) to conduct all due diligence which the Underwriters may reasonably require or which may be considered necessary or appropriate by the Underwriters. The Corporation will provide to the Underwriters (and their counsel) reasonable access to the Corporation’s senior management personnel and corporate, financial and other records, for the purposes of conducting such due diligence. Without limiting the scope of the due diligence inquiry that the Underwriters (or their counsel) may conduct, the Corporation shall also make available its directors, senior management, the Chairman of the Audit Committee of the Board of Directors, the auditors Debentures will be duly and counsel to answer any questions which the Underwriters may have validly authorized and to participate in one or more due diligence sessions to be held prior to Closing and, prior to filing each of the Preliminary Prospectus and Final Prospectus and to use its commercial best efforts to arrange for the auditors of the Corporation to participate in any such due diligence sessionissued;
(b) duly the Common Shares issuable upon the conversion of the Debentures will be reserved for issuance at the Closing Time:
(c) as soon as reasonably possible, and in any event by the Closing Date, to take all such steps as may reasonably be necessary to enable the Debentures to be offered for sale and sold on a private placement basis to Subscribers in the Selling Jurisdictions through the Agent or any other investment dealers or brokers registered in any of the Selling Jurisdictions by way of the exemptions under Applicable Canadian Securities Laws of each of the Selling Jurisdictions, and not to take any action that would prevent the Corporation and the Agent from relying on the exemptions from the prospectus requirements of Applicable Canadian Securities Laws as contemplated by the Subscription Agreements;
(d) as soon as reasonably possible, and in any event by the Closing Date, to execute the Subscription Agreements which have been duly completed Shareholder Agreement and issue the Management Shares;
(e) as soon as reasonably possible, and in any event by the Purchasers subject Closing Date, to execute the Voting Agreement and issue the Deep Well Shares;
(f) as soon as reasonably possible, and in any event by the Closing Date, to cause the following person to be appointed to the terms thereoffollowing offices: Xxxxx Xxxxxxx - Executive Chairman and Chief Executive Officer;
(g) to duly, punctually and duly faithfully perform and punctually perform comply with all the obligations to be performed by it it, and all of its covenants and agreements under and pursuant to this Agreement Agreement, the Subscription Agreements and the Subscription Agreements;
(c) use its commercial best efforts to fulfil or cause to be fulfilled, at or prior to the Closing Date, each of the conditions required to be fulfilled by it set out in section 7 hereof;
(d) use its commercial best efforts to obtain the necessary approval of the TSXV for the Offering and the listing of the Underlying Securities on such terms as are customary;
(e) file with the Canadian Securities Regulators and the TSXV all forms, notices and certificates required to be filed by the Corporation pursuant to the Canadian Securities Laws and the policies of the TSXV in the time required by the Canadian Securities Laws and the policies of the TSXV, including, for greater certainty, Form 45-106F1 of NI 45-106 and any other forms, notices and certificates set forth in the opinions delivered to the Underwriters pursuant to the closing conditions set forth in section 7 hereof, as are required to be filed by the Corporation;
(f) ensure that the Underlying Shares, upon issuance, shall be duly issued as fully paid and non-assessable Common Shares, and shall have the attributes corresponding in all material respects to the description thereof set forth in this Agreement and the Subscription Agreements;
(g) fulfil all legal requirements to permit the creation, issuance, offering and sale of the Special Warrants and the Underlying Securities, all as contemplated in this Agreement and file or cause to be filed all documents, applications, forms or undertakings required to be filed by the Corporation and take or cause to be taken all action required to be taken by the Corporation in connection with the purchase and sale of the Special Warrants and the issuance of the Qualified Securities, so that the distribution of the Qualified Securities may lawfully occur without the necessity of filing a registration statement in the United States or similar document in any other jurisdictionIndenture;
(h) until it will file all necessary forms and reports with the date appropriate Securities Commissions and other regulatory authorities in connection with the issuance of the completion of Debentures and the distribution of the Qualified Securities, use commercial best efforts to ensure the Prospectus complies at all times with Canadian Securities LawsAgent’s Warrant;
(i) during the period Corporation will carry on its business in a prudent manner in accordance with industry standards and good business practice and will keep or cause to be kept proper books of accounts in accordance with applicable law;
(j) the Corporation will not, from the date hereof until the date earlier of the completion conversion of all of the distribution issued Debentures into Common Shares or Surge U.S. Shares or the repayment of all of the Qualified Securitiesissued Debentures (including all interest payable thereon); approve, promptly inform implement, adopt or authorize any stock option plan, performance warrant plan or other stock based compensation plan (collectively, the Underwriters “Option Plan”) which allows for the issuance of Common Shares in an aggregate amount greater than 5% of the full particulars of any request of any Securities Regulator for any information, or the receipt by the Corporation of any communication from any Securities Regulator or any other competent authority relating to the Corporation or which may be relevant to the distribution of the Qualified Securities;
(j) apply the net proceeds from the Offering to fund the Acquisitionissued and outstanding Common Shares;
(k) comply with each the Corporation will not, from the date hereof until the earlier of: (i) the conversion of all of the covenants issued Debentures into Common Shares or Surge U.S. Shares or the repayment of all of the issued Debentures (including all interest payable thereon); or (ii) the date on which the Corporation set out in completes an offering (or offerings) of securities to the Subscription Agreementspublic for gross proceeds of at least an aggregate of $10,000,000, grant options or similar convertible securities issuable pursuant to the Option Plan to the Management Group or to any director nominated by Surge U.S. pursuant to the Shareholder Agreement;
(l) advise immediately following the UnderwritersClosing Time on the Closing Date, promptly after receiving notice thereofit will file such discontinuances and undertakings, in such form as approved by Agent’s Counsel, acting reasonably, to cause all of the time when the Preliminary Prospectus, the Final Prospectus and any Supplementary Material have been filed and receipts therefor have been obtained pursuant Farmout Agreement Legal Claims to NP 11-202 and will provide evidence reasonably satisfactory to the Underwriters of each such filing and copies of such receiptsbe discontinued;
(m) advise the Underwriters, promptly after receiving notice or obtaining knowledge thereof, of:
(i) the issuance by any Canadian Securities Regulator of any order suspending or preventing the use of the Prospectus or any Supplementary Material;
(ii) the institution, threatening or contemplation of any proceeding except for any such purposes;
(iii) any order, ruling, or determination having the effect of suspending the sale or ceasing the trading in any securities of the Corporation (including the Special Warrants or the Underlying Securities) having been issued by any Canadian Securities Regulator or the institution, threatening or contemplation of any proceeding for any such purposes; or
(iv) any requests made by any Canadian Securities Regulators to amend or supplement the Prospectus or to provide additional information, and will use its commercial best efforts to prevent the issuance of any order referred to in (i) above andthe Management Shares, if any such order is issuedthe Deep Well Shares, to obtain the withdrawal thereof as quickly as possible;
(n) except grant of options pursuant to the extent Option Plan and the anticipated flow-through share financing, the Corporation participates in a merger or business combination transaction which is in the best interest of the Corporation and following which the Corporation is not a “reporting issuer”will not, use its commercial best efforts to maintain its status as a “reporting issuer” (or the equivalent thereof) not in default of the requirements of Canadian Securities Laws of each of the Canadian jurisdictions in which it is currently a reporting issuer, which have such a concept to from the date which hereof until that date that is two years 120 days following the Closing Date; and
(o) except , directly or indirectly, sell, or offer to sell, or announce the extent offering of, or enter into or make any agreement or understanding, or announce the Corporation participates in a merger making or business combination transaction which is in entry into of any agreement or understanding, to issue, sell or exchange any Common Shares, securities exchangeable or convertible into Common Shares without the best interest prior written consent of the Corporation and following which the Corporation is Agent, not listed on the TSXV or the TSX, use its commercial best efforts to maintain the listing of:
(i) the Common Shares on the TSXV or the TSX or such other recognized stock exchange or quotation system as Canaccord Genuity, on behalf of the Underwriters, may approve, acting reasonably, to the date that is two years following the Closing Date; and
(ii) the Convertible Debentures and the Warrants on the TSXV or the TSX or such other recognized stock exchange or quotation system as Canaccord Genuity, on behalf of the Underwriters, may approve, acting reasonably, until the Maturity Date or Expiry Date, as applicable. The Corporation further hereby covenants to the Underwriters and to the Purchasers and their permitted assigns, and acknowledges that each of them is relying on such covenants in purchasing the Special Warrants, that following the Closing:
(p) the Corporation shall qualify the distribution of the Qualified Securities in the Qualifying Provinces to holders of the Special Warrants and file the Preliminary Prospectus in each of the Qualifying Provinces as soon as possible following the Closing Date and the Final Prospectus promptly following receipt and settlement of comments from the Canadian Securities Regulators;
(q) the Corporation shall use its commercial best efforts to: satisfy all comments with respect to the Preliminary Prospectus; prepare and file the Final Prospectus under Canadian Securities Laws; obtain the Final Receipt (in accordance with the procedures of prospectus review in multiple jurisdictions provided for under NP 11-202), and take all other steps and proceedings that may be necessary to be taken by the Corporation in order to qualify the Qualified Securities for distribution in each of the Qualifying Provinces under Canadian Securities Laws, as soon as practicable following the Closing Date and, in any event, prior to the Qualification Deadline;
(r) the Corporation shall allow the Underwriters to participate in the preparation of the Prospectus and any Supplementary Material that the Corporation is required to file under Canadian Securities Laws relating to the Offering;
(s) the delivery of the Final Prospectus and any Supplementary Material to the Underwriters by the Corporation in accordance with this Agreement will constitute the representation and warranty of the Corporation to the Underwriters that (except for information and statements relating solely to the Underwriters and furnished by them specifically for use in the Final Prospectus), at the respective times of delivery:
(i) the information and statements contained in each of the Final Prospectus and any Supplementary Material:
(A) are true and correct and contain no misrepresentation; and
(B) constitute full, true and plain disclosure of all material facts relating to the Qualified Securities and the Corporation considered as a whole;
(ii) no material fact has been omitted from any of the Final Prospectus and any Supplementary Material that is required to be stated in the document or is necessary to make the statements therein not misleading in the light of the circumstances in which they were made; and
(iii) the Final Prospectus and the Supplementary Material comply in all material respects with Canadian Securities Laws;
(t) the Corporation will deliver to the Underwriters, without charge, contemporaneously with, or prior to the filing of, the Final Prospectus, unless otherwise indicated:
(i) a copy of any document filed with, or delivered to, the Canadian Securities Regulators by the Corporation under Canadian Securities Laws with the Final Prospectus;
(ii) a certificate dated the date of the Final Prospectus, addressed to the Underwriters and signed by the Chief Executive Officer and Chief Financial Officer of the Corporation, certifying for and on behalf of the Corporation, and not in their personal capacities, after having made due inquiries, with respect to the following matters:
(A) the Corporation having complied with all of the covenants and satisfied all of the terms and conditions of this Agreement on its part to be complied with and satisfied at or prior to the date of the Final Prospectus;
(B) no order, ruling or determination having the effect of ceasing or suspending trading in any securities of the Corporation or prohibiting the issue of the Special Warrants or the Underlying Securities or any of the Corporation’s issued securities having been issued and no proceeding for such purpose being pending or, to the knowledge of such officers, threatened;
(C) the representations and warranties of the Corporation contained in this Agreement and in any certificates of Corporation delivered pursuant to or in connection with this Agreement being true and correct as at the date of the Final Prospectus, with the same force and effect as if made on and as at the date of the Final Prospectus, after giving effect to the transactions contemplated by this Agreement; and
(D) since the Closing Time, there having been no material adverse change, financial or otherwise, in the assets, liabilities (contingent or otherwise), capital, business or results of operations of the Corporation;
(u) the Corporation shall deliver opinions, comfort letters and other documents substantially similar to those referred to in this section 1 to Canaccord Genuity and the Underwriters’ counsel, as applicable, with respect to any Supplementary Material, contemporaneously with, or prior to the filing of, any Supplementary Material;
(v) until the earlier of the Qualification Date and the Qualification Deadline, the Corporation shall deliver to the Underwriters copies of all correspondence and other written communications between the Corporation and any Securities Regulators or other Governmental Authority relating to the Offering and the Acquisition and will generally keep the Underwriters apprised of the status of, including all developments relating to, the Offering, the Acquisition, and satisfaction of closing conditions for the Acquisition and the Release Conditions;
(w) the Corporation shall comply with and satisfy, in all material respects, all terms, conditions and covenants in the Offer to Purchase;
(x) the Corporation shall use its commercial best efforts to satisfy the Release Conditions prior to the Release Deadline, including seeking any extensions or waivers necessary to keep the Offer to Purchase in full force and effect until the Qualification Deadline as necessary;
(y) the Corporation shall use its commercial best efforts to enforce its rights against CryptoLogic and its affiliates under the Offer to Purchase;
(z) the Corporation shall notify Canaccord Genuity in writing of the receipt of all regulatory approvals required to complete the Acquisition;
(aa) as a condition precedent to the execution of the joint notice by Canaccord Genuity with the Corporation in respect of the Release Event pursuant to the Release Conditions, the Chief Executive Officer of the Corporation shall have delivered to Canaccord Genuity a certification that all conditions to the completion of the Acquisition by the Corporation, on terms previously disclosed to or otherwise reasonably acceptable to Canaccord Genuity, have been satisfied or waived; and
(bb) in the event that the Release Event does not occur on or before the Release Deadline, the Corporation shall forthwith deliver a notice to each of the Special Warrant holders and the Agent and the Agent shall return, within three Business Days, to each such holder the applicable subscription amount, plus any interest earned thereon, less applicable withholding taxes, if any, and the Special Warrants shall be cancelled. The Corporation shall be responsible for any shortfall in the aggregate subscription amount payable to Special Warrant holdersunreasonably withheld.
Appears in 1 contract
Corporation’s Covenants. The Corporation hereby covenants to the Underwriters Agent and to the Purchasers and their permitted assigns, and acknowledges that each of them is relying on such covenants in purchasing the Special Warrants, that the Corporation shallUnits:
(a) prior to unless otherwise inconsistent with the fiduciary duties of the board of directors of the Corporation, for a period of 18 months after the Closing Time and at all times until Date it will use commercially reasonable efforts to maintain its status as a Final Receipt is issued, allow the Underwriters (and their counsel and consultants) to conduct all due diligence which the Underwriters may reasonably require or which may be considered necessary or appropriate by the Underwriters. The Corporation will provide to the Underwriters (and their counsel) reasonable access to the Corporation’s senior management personnel and corporate, financial and other records, for the purposes of conducting such due diligence. Without limiting the scope “reporting issuer” under Securities Laws of the due diligence inquiry that the Underwriters (or their counsel) may conductprovinces of British Columbia, the Corporation shall also make available its directorsAlberta, senior managementSaskatchewan, the Chairman New Brunswick and Ontario not in default of the Audit Committee any requirement of the Board of Directors, the auditors and counsel to answer any questions which the Underwriters may have and to participate in one or more due diligence sessions to be held prior to Closing and, prior to filing each of the Preliminary Prospectus and Final Prospectus and to use its commercial best efforts to arrange for the auditors of the Corporation to participate in any such due diligence sessionSecurities Laws;
(b) the Unit Shares and the Warrants (including those Unit Shares and Warrants underlying the Over-Allotment Units, if applicable) will be duly execute and validly created, authorized and issued on the Subscription Agreements which have been duly completed by the Purchasers subject to the terms thereofpayment therefor, and duly such Unit Shares and punctually perform all Warrants (including those Unit Shares and Warrants underlying the obligations to be performed by it under this Agreement Over-Allotment Units, if applicable) will have the attributes set out in the U.S. Preliminary Prospectus, the U.S. Prospectus, the Registration Statement, and the Subscription Agreementsany Amendment, as applicable;
(c) as promptly as practicable following the Closing Date and the receipt by the Corporation of Selling Securityholder Forms, it will prepare and file the U.S. Preliminary Prospectus under the U.S. Securities Act in the United States;
(d) as soon as possible after any comments of the SEC have been satisfied, it will have caused the Registration Statement to be declared effective by the SEC and will prepare and file with the SEC, the U.S. Prospectus pursuant to Rule 424(b) under the U.S. Securities Act in the United States; and shall further ensure that no stop order suspending the effectiveness of the U.S. Prospectus, the Registration Statement or any post-effective amendment thereto or any Rule 462(b) Registration Statement, if any, is issued and no proceeding for that purpose is initiated or threatened by the SEC; the various parts of the Initial Registration Statement and the Rule 462(b) Registration Statement, if any, including all exhibits thereto and including the information contained in the form of final prospectus filed with the SEC pursuant to Rule 424(b) under the U.S. Securities Act in accordance with Section 5(a) hereof and deemed by virtue of Rule 430A under the U.S. Securities Act to be part of the Initial Registration Statement at the time it is declared effective, each as amended at the time such part of the Initial Registration Statement becomes effective or such part of the Rule 462(b) Registration Statement, if any, becomes effective, are hereinafter collectively called the “Registration Statement”; and such final prospectus, in the form first filed pursuant to Rule 424(b) under the U.S. Securities Act, is hereinafter called the “U.S. Prospectus”;
(e) The Corporation agrees to use commercially reasonable efforts, including instructing its counsel to deliver requested legal opinions, following the effectiveness of the Registration Statement to instruct the Transfer Agent for the Common Shares, Warrant Shares, Warrants, Broker Warrants and Broker Shares covered by the Registration Statement to remove any restrictive legends included on such Common Shares, Warrant Shares, Warrants, Broker Warrants or Broker Shares in connection with the initial sale or transfer thereof by the selling securityholders listed in the Registration Statement, and any costs related to the removal of the restrictive legends shall be borne by the Corporation (up to a maximum of $150 per legend removal request per securityholder);
(f) it shall fulfill to the satisfaction of the Agent all legal requirements to be fulfilled by it to enable the Unit Shares and the Warrants (including those Unit Shares and Warrants underlying the Over-Allotment Units, if applicable) to be offered for sale and sold in the Qualifying Jurisdictions by or through the Selling Firms who comply with all applicable Securities Laws in each of the Selling Jurisdictions;
(g) each of the Unit Shares, Warrants and Warrant Shares, including those issued pursuant to the Over-Allotment Option, and the Broker Warrants and the Broker Shares, upon effectiveness of the Registration Statement, will not carry any United States resale or transfer restrictions under applicable United States Securities Laws;
(h) it shall allow and assist the Agent to participate fully in the preparation of the U.S. Preliminary Prospectus, the U.S. Prospectus, the Registration Statement and any Amendment, as applicable, and shall allow the Agent to conduct all “due diligence” investigations which the Agent may reasonably require to fulfill the Agent’s obligations as Agent and to enable the Agent responsibly to execute any certificate required to be executed by the Agent and it shall comply with all requests for additional information on the part of the SEC or any Canadian Securities Commission to the reasonable satisfaction of the Agent;
(i) it will comply with the Securities Laws in each of the Qualifying Jurisdictions it will promptly inform the Agent in writing of the full particulars of any material change, actual, anticipated or threatened, in the operating or financial condition of the Corporation or of any change in any material fact contained or referred to in the U.S. Preliminary Prospectus, the U.S. Prospectus, the Registration Statement or any Amendment or Supplementary Material thereto, as applicable, and of the existence of any material fact which is, or may be, of such a nature as to render the U.S. Preliminary Prospectus, the U.S. Prospectus, the Registration Statement or any Amendment or Supplementary Material thereto, as applicable, untrue, false or misleading in a material respect or result in a misrepresentation. The Corporation shall, to the satisfaction of the Agent and its counsel, acting reasonably, promptly comply with all applicable filings and other requirements under the Securities Laws as a result of such change. The Corporation shall, in good faith, first discuss with the Agent any change in circumstances (actual or proposed, within the Corporation’s knowledge) which is of such a nature that there is reasonable doubt whether notice need be given to the Agent pursuant to this Section 2(i) and, in any event, prior to making any filing referred to in this Section 2(i). For greater certainty, it is understood and agreed that if the Agent determines, after consultation with the Corporation, that a material change or change in a material fact has occurred which makes untrue or misleading any statement of a material fact contained in the U.S. Preliminary Prospectus, the U.S. Prospectus, the Registration Statement or any Amendment or Supplementary Material thereto, or which may result in a misrepresentation, the Corporation will:
i. prepare and file promptly any Amendment which in its opinion, acting reasonably, may be necessary or advisable after consultation with the Agent; and
ii. contemporaneously with filing the Amendment under the Securities Laws, the Corporation will deliver to the Agent:
(A) an originally signed copy of the Amendment;
(B) an originally signed copy of all documents relating to the proposed distribution of the Units and filed with the Amendment under Securities Laws; and
(C) such other documents as the Agent shall reasonably require;
(j) it will advise the Agent, promptly after receiving notice thereof, of the time when the U.S. Preliminary Prospectus, the U.S. Prospectus, the Registration Statement and any Amendment or Supplementary Material has been filed and receipts have been obtained and will provide evidence satisfactory to the Agent of each filing and the issuance of receipts;
(k) it will advise the Agent, promptly after receiving notice or obtaining knowledge, of:
i. the issuance by any Securities Commission of any order suspending or preventing the use of the U.S. Preliminary Prospectus, the U.S. Prospectus, the Registration Statement or any Supplementary Material;
ii. the suspension of the qualification of the Units, or, if applicable, the Over-Allotment Units for offering or sale in any of the Selling Jurisdictions;
iii. the institution, threatening or contemplation of any proceeding for any of those purposes; or
iv. any requests made by any Securities Commission for amending or supplementing the U.S. Preliminary Prospectus, the U.S. Prospectus or the Registration Statement or for additional information, and will use its commercial best commercially reasonable efforts to prevent the issuance of any such order and, if any such order is issued, to obtain the withdrawal of the order promptly;
(l) it will use commercially reasonable efforts to promptly do, make, execute, deliver or cause to be done, made, executed or delivered, all such acts, documents and things as the Agent may reasonably require from time to time for the purpose of giving effect to this Agreement, the Subscription Agreements and the transactions contemplated by the U.S. Preliminary Prospectus, the U.S. Prospectus and the Registration Statement and take all such steps as may be reasonably within their power to implement to their full extent the provisions of this Agreement, the Subscription Agreements and the transactions contemplated by the U.S. Preliminary Prospectus, the U.S. Prospectus and the Registration Statement;
(m) it is not an “ineligible issuer” as defined under Rule 405 under the U.S. Securities Act;
(n) it does not have any outstanding debt securities that are rated by any “nationally recognized statistical rating organization”, as that term is defined by the SEC for purposes of Rule 436(g)(2) under the Act or by the DBRS rating agency in Canada;
(o) it will ensure that a sufficient number of Common Shares are allotted and reserved for issuance upon the exercise of the Warrants, and the Broker Warrants;
(p) it will ensure that the Warrants are duly and validly created, authorized and issued on payment of the exercise price therefor and shall have attributes corresponding in all material respects to the description set forth in this Agreement;
(q) it will ensure that the Broker Warrants are duly and validly created, authorized and issued on payment of the exercise price therefor and shall have attributes corresponding in all material respects to the description set forth in this Agreement;
(r) it will ensure that the Warrant Shares issuable upon the exercise of the Warrants and the Broker Shares issuable upon the exercise of the Broker Warrants shall, upon issuance in accordance with their terms or the terms of the Warrant Indenture, as applicable, without limitation, including payment of the exercise price therefor, be duly issued as fully paid and non-assessable shares of the Corporation;
(s) it will make all necessary filings, obtain all necessary regulatory consents and approvals (if any) and the Corporation will pay all filing fees required to be paid in connection with the transactions contemplated in this Agreement;
(t) subject to compliance with applicable laws, any press release of the Corporation relating to the Offering will be provided in advance to the Agent and the Corporation will agree to the form and substance thereof with the Agent prior to the release thereof;
(u) it shall use commercially reasonable efforts to maintain the Registration Statement or post-effective amendment thereto effective under the U.S. Securities Act until the earlier of: (i) the date that all of the Unit Shares, Warrants and Warrant Shares registered pursuant to the Registration Statement have been sold pursuant to such Registration Statement or Rule 144 under the U.S. Securities Act , if available, or (ii) the date that is 48 months from the Closing Date;
(v) it will file promptly all reports and any definitive proxy or information statements required to be filed by the Corporation with the SEC pursuant to Section 13(a), 13(c), 14 or 15(d) of the U.S. Exchange Act subsequent to the date of the U.S. Prospectus and for so long as the delivery of the U.S. Prospectus is required in connection with the offering or sale of the Units and Over-Allotment Units or the terms of this Agreement;
(w) it will not for a period commencing the date that this Agreement is signed and for two years thereafter to remain a reporting issuer under Canadian Securities Laws in the Canadian Qualifying Jurisdictions, not in default of any requirement of such Canadian Securities Laws, provided that this covenant shall not prevent the Corporation from completing any transaction which would result in the Corporation ceasing to be a “reporting issuer” so long as the holders of Common Shares receive securities of an entity which is listed on a stock exchange in Canada or cash or the holders of the Common Shares have approved the transaction in accordance with the requirements of applicable corporate laws and the policies of the TSX;
(x) it will not take any action for a period commencing on the Closing Date and for two years thereafter which would reasonably be expected to result in the delisting or suspension of its Common Shares on or from the TSX or on or from any securities exchange, market or trading or quotation facility on which its Common Shares are then listed or quoted, provided that this covenant shall not prevent the Corporation from completing any transaction which would result in the Corporation ceasing to be listed on the TSX so long as the holders of Common Shares receive securities of an entity which is listed on a stock exchange in Canada or cash or the holders of the Common Shares have approved the transaction in accordance with the requirements of applicable corporate laws and the policies of the TSX;
(y) it will not, and will use its commercially reasonable efforts to ensure that each of the Corporation or the Subsidiaries or any of their respective officers, directors or employees, as the case may be, do not, bid for or purchase, for their own account or any account in which they have a beneficial interest, any Common Shares or any securities exchangeable or exercisable for or convertible into Common Shares after the date hereof until the Closing Date without the written consent of the Agent;
(z) it has not engaged in, nor will it engage in, any directed selling efforts (as defined in Regulation S) in connection with the offer and sale of the Units;
(aa) no forward looking statement (within the meaning of Section 27A of the U.S. Securities Act) included or incorporated by reference in the Registration Statement, the U.S. Preliminary Prospectus or the U.S. Prospectus, has been made or reaffirmed without a reasonable basis or has been disclosed other than in good faith;
(bb) it will duly execute and deliver the Subscription Agreements and the certificates representing the Warrants and the Broker Warrants, at the Closing Time, and comply with and satisfy all terms, conditions and covenants therein contained to be complied with or satisfied;
(cc) it will use commercially reasonable efforts to fulfil or cause to be fulfilled, at or prior to the Closing DateTime, each of the conditions required to be fulfilled by it set out in section 7 hereofunder Section 8;
(ddd) it will use its commercial best efforts to obtain the necessary approval of the TSXV for the Offering and the listing of the Underlying Securities on such terms as are customary;
(e) file with the Canadian Securities Regulators and the TSXV all forms, notices and certificates required to be filed by the Corporation pursuant to the Canadian Securities Laws and the policies of the TSXV in the time required by the Canadian Securities Laws and the policies of the TSXV, including, for greater certainty, Form 45-106F1 of NI 45-106 and any other forms, notices and certificates set forth in the opinions delivered to the Underwriters pursuant to the closing conditions set forth in section 7 hereof, as are required to be filed by the Corporation;
(f) ensure that the Underlying Shares, upon issuance, shall be duly issued as fully paid and non-assessable Common Shares, and shall have the attributes corresponding in all material respects to the description thereof set forth in this Agreement and the Subscription Agreements;
(g) fulfil all legal requirements to permit the creation, issuance, offering and sale of the Special Warrants and the Underlying Securities, all as contemplated in this Agreement and file or cause to be filed all documents, applications, forms or undertakings required to be filed by the Corporation and take or cause to be taken all action required to be taken by the Corporation in connection with the purchase and sale of the Special Warrants and the issuance of the Qualified Securities, so that the distribution of the Qualified Securities may lawfully occur without the necessity of filing a registration statement in the United States or similar document in any other jurisdiction;
(h) until the date of the completion of the distribution of the Qualified Securities, use commercial best efforts to ensure the Prospectus complies at all times with Canadian Securities Laws;
(i) during the period from the date hereof until the date of the completion of the distribution of the Qualified Securities, promptly inform the Underwriters of the full particulars of any request of any Securities Regulator for any information, or the receipt by the Corporation of any communication from any Securities Regulator or any other competent authority relating to the Corporation or which may be relevant to the distribution of the Qualified Securities;
(j) apply the net proceeds from of the Offering to fund the Acquisition;
(k) comply with each of the covenants of the Corporation set out in the Subscription Agreements;
(l) advise the Underwriters, promptly after receiving notice thereof, of the time when the Preliminary Prospectus, the Final Prospectus for working capital and any Supplementary Material have been filed and receipts therefor have been obtained pursuant to NP 11-202 and will provide evidence reasonably satisfactory to the Underwriters of each such filing and copies of such receipts;
(m) advise the Underwriters, promptly after receiving notice or obtaining knowledge thereof, of:
(i) the issuance by any Canadian Securities Regulator of any order suspending or preventing the use of the Prospectus or any Supplementary Material;
(ii) the institution, threatening or contemplation of any proceeding for any such general corporate purposes;
(iiiee) any orderit will ensure that all necessary notices and filings will have been made before the Closing Time and that all necessary consents, ruling, or determination having the effect of suspending the sale or ceasing the trading in any securities of approvals and authorizations will have been obtained by the Corporation (including from the Special Warrants or TSX to ensure that the Underlying Securities) having been issued by any Canadian Securities Regulator or Unit Shares, Warrant Shares and Broker Shares will be listed on the institution, threatening or contemplation TSX upon and at the time of any proceeding for any such purposes; or
(iv) any requests made by any Canadian Securities Regulators to amend or supplement the Prospectus or to provide additional information, and will use its commercial best efforts to prevent the issuance of any order referred to in (i) above and, if any such order is issued, to obtain the withdrawal thereof as quickly as possible;
(n) except to the extent the Corporation participates in a merger or business combination transaction which is in the best interest of the Corporation and following which the Corporation is not a “reporting issuer”, use its commercial best efforts to maintain its status as a “reporting issuer” (or the equivalent thereof) not in default of the requirements of Canadian Securities Laws of each of the Canadian jurisdictions in which it is currently a reporting issuer, which have such a concept to the date which is two years following the Closing Datetheir issuance; and
(off) except to the extent the Corporation participates in a merger or business combination transaction which is in the best interest of the Corporation it will ensure that all information (including, without limitation, financial information) and following which the Corporation is not listed on the TSXV or the TSX, use its commercial best efforts to maintain the listing of:
(i) the Common Shares on the TSXV or the TSX or such other recognized stock exchange or quotation system as Canaccord Genuity, on behalf of the Underwriters, may approve, acting reasonably, to the date that is two years following the Closing Date; and
(ii) the Convertible Debentures and the Warrants on the TSXV or the TSX or such other recognized stock exchange or quotation system as Canaccord Genuity, on behalf of the Underwriters, may approve, acting reasonably, until the Maturity Date or Expiry Date, as applicable. The Corporation further hereby covenants to the Underwriters and to the Purchasers and their permitted assigns, and acknowledges that each of them is relying on such covenants in purchasing the Special Warrants, that following the Closing:
(p) the Corporation shall qualify the distribution of the Qualified Securities in the Qualifying Provinces to holders of the Special Warrants and file the Preliminary Prospectus in each of the Qualifying Provinces as soon as possible following the Closing Date and the Final Prospectus promptly following receipt and settlement of comments from the Canadian Securities Regulators;
(q) the Corporation shall use its commercial best efforts to: satisfy all comments with respect to the Preliminary Prospectus; prepare and file the Final Prospectus under Canadian Securities Laws; obtain the Final Receipt (in accordance with the procedures of prospectus review in multiple jurisdictions provided for under NP 11-202), and take all other steps and proceedings that may be necessary to be taken by the Corporation in order to qualify the Qualified Securities for distribution in each of the Qualifying Provinces under Canadian Securities Laws, as soon as practicable following the Closing Date and, in any event, prior to the Qualification Deadline;
(r) the Corporation shall allow the Underwriters to participate in the preparation of the Prospectus and any Supplementary Material that the Corporation is required to file under Canadian Securities Laws relating to the Offering;
(s) the delivery of the Final Prospectus and any Supplementary Material to the Underwriters by the Corporation in accordance with this Agreement will constitute the representation and warranty of the Corporation to the Underwriters that statements (except for information and statements relating solely to the Underwriters Agent) relating to the Corporation provided to the Agent and furnished by them specifically for use in the Final Prospectus), at the respective times of delivery:
(i) the information and statements contained in each of the Final Prospectus and any Supplementary Material:
(A) are Purchasers will be true and correct in all material respects at the time of delivery thereof and will not contain no misrepresentation; and
(B) any misrepresentation and will constitute full, true and plain disclosure of all material facts relating to the Qualified Securities Corporation, and the Corporation considered as a whole;
(ii) that no material fact has been or information will be omitted from any of the Final Prospectus and any Supplementary Material that therefrom which is required to be stated in the document therein or is necessary to make the statements or information contained therein not misleading in the light of the circumstances in under which they were made; and
(iii) the Final Prospectus and the Supplementary Material comply in all material respects with Canadian Securities Laws;
(t) the Corporation will deliver to the Underwriters, without charge, contemporaneously with, or prior to the filing of, the Final Prospectus, unless otherwise indicated:
(i) a copy of any document filed with, or delivered to, the Canadian Securities Regulators by the Corporation under Canadian Securities Laws with the Final Prospectus;
(ii) a certificate dated the date of the Final Prospectus, addressed to the Underwriters and signed by the Chief Executive Officer and Chief Financial Officer of the Corporation, certifying for and on behalf of the Corporation, and not in their personal capacities, after having made due inquiries, with respect to the following matters:
(A) the Corporation having complied with all of the covenants and satisfied all of the terms and conditions of this Agreement on its part to be complied with and satisfied at or prior to the date of the Final Prospectus;
(B) no order, ruling or determination having the effect of ceasing or suspending trading in any securities of the Corporation or prohibiting the issue of the Special Warrants or the Underlying Securities or any of the Corporation’s issued securities having been issued and no proceeding for such purpose being pending or, to the knowledge of such officers, threatened;
(C) the representations and warranties of the Corporation contained in this Agreement and in any certificates of Corporation delivered pursuant to or in connection with this Agreement being true and correct as at the date of the Final Prospectus, with the same force and effect as if made on and as at the date of the Final Prospectus, after giving effect to the transactions contemplated by this Agreement; and
(D) since the Closing Time, there having been no material adverse change, financial or otherwise, in the assets, liabilities (contingent or otherwise), capital, business or results of operations of the Corporation;
(u) the Corporation shall deliver opinions, comfort letters and other documents substantially similar to those referred to in this section 1 to Canaccord Genuity and the Underwriters’ counsel, as applicable, with respect to any Supplementary Material, contemporaneously with, or prior to the filing of, any Supplementary Material;
(v) until the earlier of the Qualification Date and the Qualification Deadline, the Corporation shall deliver to the Underwriters copies of all correspondence and other written communications between the Corporation and any Securities Regulators or other Governmental Authority relating to the Offering and the Acquisition and will generally keep the Underwriters apprised of the status of, including all developments relating to, the Offering, the Acquisition, and satisfaction of closing conditions for the Acquisition and the Release Conditions;
(w) the Corporation shall comply with and satisfy, in all material respects, all terms, conditions and covenants in the Offer to Purchase;
(x) the Corporation shall use its commercial best efforts to satisfy the Release Conditions prior to the Release Deadline, including seeking any extensions or waivers necessary to keep the Offer to Purchase in full force and effect until the Qualification Deadline as necessary;
(y) the Corporation shall use its commercial best efforts to enforce its rights against CryptoLogic and its affiliates under the Offer to Purchase;
(z) the Corporation shall notify Canaccord Genuity in writing of the receipt of all regulatory approvals required to complete the Acquisition;
(aa) as a condition precedent to the execution of the joint notice by Canaccord Genuity with the Corporation in respect of the Release Event pursuant to the Release Conditions, the Chief Executive Officer of the Corporation shall have delivered to Canaccord Genuity a certification that all conditions to the completion of the Acquisition by the Corporation, on terms previously disclosed to or otherwise reasonably acceptable to Canaccord Genuity, have been satisfied or waived; and
(bb) in the event that the Release Event does not occur on or before the Release Deadline, the Corporation shall forthwith deliver a notice to each of the Special Warrant holders and the Agent and the Agent shall return, within three Business Days, to each such holder the applicable subscription amount, plus any interest earned thereon, less applicable withholding taxes, if any, and the Special Warrants shall be cancelled. The Corporation shall be responsible for any shortfall in the aggregate subscription amount payable to Special Warrant holders.
Appears in 1 contract
Corporation’s Covenants. The Corporation hereby covenants to the Underwriters and to the Purchasers and their permitted assigns, and acknowledges that each of them is relying on such covenants in purchasing the Special Warrants, that the Corporation shall:
(a) prior to the Closing Time and at all times until a receipt for a Final Receipt Prospectus is issued, allow the Underwriters (and their counsel and consultants) to conduct all due diligence which the Underwriters may reasonably require or which may be considered necessary or appropriate by the Underwriters. The Corporation will provide to the Underwriters (and their counsel) reasonable access to the Corporation’s properties, senior management personnel and corporate, financial and other records, for the purposes of conducting such due diligence. Without limiting the scope of the due diligence inquiry that the Underwriters (or their counsel) may conduct, the Corporation shall also make available its directors, senior management, the Chairman of the Audit Committee of the Board of Directorstechnical advisors, the auditors and counsel to answer any questions which the Underwriters may have and to participate in one or more due diligence sessions to be held prior to Closing and, prior to filing each of the Preliminary Prospectus and Final Prospectus and to use its commercial best commercially reasonable efforts to arrange for the auditors of the Corporation and the authors of the Toroparu Gold Copper Prospect Report to participate in such due diligence sessions and/or provide written responses in connection with any such due diligence session;
(b) duly execute the Subscription Agreements which have been duly completed by the Purchasers subject to the terms thereof, and duly and punctually perform all the obligations to be performed by it under this Agreement and the Subscription Agreements;
(c) use its commercial best commercially reasonable efforts to fulfil or cause to be fulfilled, at or prior to the Closing Date, each of the conditions required to be fulfilled by it set out in section 7 hereofSection 7;
(d) use its commercial best commercially reasonable efforts to obtain the necessary approval of the TSXV for the Offering and the listing of the Underlying Securities on such terms as are customary;
(e) file with the Canadian Securities Regulators and the TSXV all forms, notices and certificates required to be filed by the Corporation pursuant to the Canadian Securities Laws and the policies of the TSXV in the time required by the Canadian Securities Laws and the policies of the TSXV, including, for greater certainty, Form 45-106F1 of NI 45-106 and any other forms, notices and certificates set forth in the opinions delivered to the Underwriters pursuant to the closing conditions set forth in section 7 hereof, as are required to be filed by the Corporation;
(f) ensure that the Underlying Shares, upon issuance, shall be duly issued as fully paid and non-assessable Common Shares, and shall have the attributes corresponding in all material respects to the description thereof set forth in this Agreement and the Subscription Agreements;
(g) fulfil all legal requirements to permit the creation, issuance, offering and sale of the Special Warrants and the Underlying creation and issuance of the Compensation Options and the Qualified Securities, all as contemplated in this Agreement and file or cause to be filed all documents, applications, forms or undertakings required to be filed by the Corporation and take or cause to be taken all action required to be taken by the Corporation in connection with the purchase and sale of the Special Warrants and the issuance of the Qualified SecuritiesCompensation Options, so that the distribution of the Qualified Securities such securities may lawfully occur without the necessity of filing a prospectus in Canada or a registration statement in the United States or similar document in any other jurisdiction;
(hf) until the date of the completion of the distribution of the Qualified Securities, use commercial best commercially reasonable efforts to ensure the Preliminary Prospectus complies and the Final Prospectus comply at all times with applicable Canadian Securities Laws;
(ig) during the period from the date hereof until the date of the completion of the distribution of the Qualified Securities, promptly inform the Underwriters in writing of the full particulars of any request of any Securities Regulator for any information, or the receipt by the Corporation of any communication from any Securities Regulator or any other competent authority relating to the Corporation or which may be relevant to the distribution of the Qualified Securities;
(j) apply the net proceeds from the Offering to fund the Acquisition;
(k) comply with each of the covenants of the Corporation set out in the Subscription Agreements;
(l) advise the Underwriters, promptly after receiving notice thereof, of the time when the Preliminary Prospectus, the Final Prospectus and any Supplementary Material have been filed and receipts therefor have been obtained pursuant to NP 11-202 and will provide evidence reasonably satisfactory to the Underwriters of each such filing and copies of such receipts;
(m) advise the Underwriters, promptly after receiving notice or obtaining knowledge thereof, of:
(i) any change (actual, anticipated, contemplated, proposed or threatened, financial or otherwise) in the issuance by any Canadian Securities Regulator of any order suspending business, financial condition, affairs, operations, assets (including the Material Properties), liabilities or preventing the use obligations (contingent or otherwise), prospects, capital or ownership of the Prospectus or any Supplementary MaterialCorporation, as the case may be;
(ii) any change in any material fact disclosed in the institution, threatening or contemplation of any proceeding for any such purposesDisclosure Documents;
(iii) any order, ruling, or determination having the effect of suspending the sale or ceasing the trading material fact in any securities respect of the Corporation (including the Special Warrants or the Underlying Securities) having that had not been issued by any Canadian Securities Regulator or the institution, threatening or contemplation of any proceeding for any such purposes; or
(iv) any requests made by any Canadian Securities Regulators to amend or supplement the Prospectus or to provide additional information, and will use its commercial best efforts to prevent the issuance of any order referred to in (i) above and, if any such order is issued, to obtain the withdrawal thereof as quickly as possible;
(n) except to the extent the Corporation participates in a merger or business combination transaction which is in the best interest of the Corporation and following which the Corporation is not a “reporting issuer”, use its commercial best efforts to maintain its status as a “reporting issuer” (or the equivalent thereof) not in default of the requirements of Canadian Securities Laws of each of the Canadian jurisdictions in which it is currently a reporting issuer, which have such a concept to the date which is two years following the Closing Date; and
(o) except to the extent the Corporation participates in a merger or business combination transaction which is in the best interest of the Corporation and following which the Corporation is not listed on the TSXV or the TSX, use its commercial best efforts to maintain the listing of:
(i) the Common Shares on the TSXV or the TSX or such other recognized stock exchange or quotation system as Canaccord Genuity, on behalf of the Underwriters, may approve, acting reasonably, to the date that is two years following the Closing Date; and
(ii) the Convertible Debentures and the Warrants on the TSXV or the TSX or such other recognized stock exchange or quotation system as Canaccord Genuity, on behalf of the Underwriters, may approve, acting reasonably, until the Maturity Date or Expiry Date, as applicable. The Corporation further hereby covenants to the Underwriters and to the Purchasers and their permitted assigns, and acknowledges that each of them is relying on such covenants in purchasing the Special Warrants, that following the Closing:
(p) the Corporation shall qualify the distribution of the Qualified Securities in the Qualifying Provinces to holders of the Special Warrants and file the Preliminary Prospectus in each of the Qualifying Provinces as soon as possible following the Closing Date and the Final Prospectus promptly following receipt and settlement of comments from the Canadian Securities Regulators;
(q) the Corporation shall use its commercial best efforts to: satisfy all comments with respect to the Preliminary Prospectus; prepare and file the Final Prospectus under Canadian Securities Laws; obtain the Final Receipt (in accordance with the procedures of prospectus review in multiple jurisdictions provided for under NP 11-202), and take all other steps and proceedings that may be necessary to be taken by the Corporation in order to qualify the Qualified Securities for distribution in each of the Qualifying Provinces under Canadian Securities Laws, as soon as practicable following the Closing Date and, in any event, prior to the Qualification Deadline;
(r) the Corporation shall allow the Underwriters to participate in the preparation of the Prospectus and any Supplementary Material that the Corporation is required to file under Canadian Securities Laws relating to the Offering;
(s) the delivery of the Final Prospectus and any Supplementary Material to the Underwriters by the Corporation in accordance with this Agreement will constitute the representation and warranty of the Corporation to the Underwriters that (except for information and statements relating solely to the Underwriters and furnished by them specifically for use in the Final Prospectus), at the respective times of delivery:
(i) the information and statements contained in each of the Final Prospectus and any Supplementary Material:
(A) are true and correct and contain no misrepresentation; and
(B) constitute full, true and plain disclosure of all material facts relating to the Qualified Securities and the Corporation considered as a whole;
(ii) no material fact has been omitted from any of the Final Prospectus and any Supplementary Material that is required to be stated in the document or is necessary to make the statements therein not misleading in the light of the circumstances in which they were made; and
(iii) the Final Prospectus and the Supplementary Material comply in all material respects with Canadian Securities Laws;
(t) the Corporation will deliver previously disclosed to the Underwriters, without charge, contemporaneously withwhich change or material fact is, or prior to the filing ofmay be, the Final Prospectus, unless otherwise indicated:
(i) a copy of any document filed with, or delivered to, the Canadian Securities Regulators by the Corporation under Canadian Securities Laws with the Final Prospectus;
(ii) a certificate dated the date of the Final Prospectus, addressed to the Underwriters and signed by the Chief Executive Officer and Chief Financial Officer of the Corporation, certifying for and on behalf of the Corporation, and not in their personal capacities, after having made due inquiries, with respect to the following matters:
(A) the Corporation having complied with all of the covenants and satisfied all of the terms and conditions of this Agreement on its part to be complied with and satisfied at or prior to the date of the Final Prospectus;
(B) no order, ruling or determination having the effect of ceasing or suspending trading in any securities of the Corporation or prohibiting the issue of the Special Warrants or the Underlying Securities or any of the Corporation’s issued securities having been issued and no proceeding for such purpose being pending or, to the knowledge of such officers, threatened;
(C) the representations and warranties of the Corporation contained in this Agreement and in any certificates of Corporation delivered pursuant to or in connection with this Agreement being true and correct as at the date of the Final Prospectus, with the same force and effect as if made on and as at the date of the Final Prospectus, after giving effect to the transactions contemplated by this Agreement; and
(D) since the Closing Time, there having been no material adverse change, financial or otherwise, a nature as: I. would result in the assets, liabilities (contingent Disclosure Documents or otherwise), capital, business Preliminary Prospectus or results of operations of the Corporation;
(u) the Corporation shall deliver opinions, comfort letters and other documents substantially similar to those referred to in this section 1 to Canaccord Genuity and the Underwriters’ counsel, as applicable, with respect to any Supplementary Material, contemporaneously with, or prior to the filing of, any Supplementary Material;
(v) until the earlier of the Qualification Date and the Qualification Deadline, the Corporation shall deliver to the Underwriters copies of all correspondence and other written communications between the Corporation and any Securities Regulators or other Governmental Authority relating to the Offering and the Acquisition and will generally keep the Underwriters apprised of the status of, including all developments relating to, the Offering, the Acquisition, and satisfaction of closing conditions for the Acquisition and the Release Conditions;
(w) the Corporation shall comply with and satisfy, in all material respects, all terms, conditions and covenants in the Offer to Purchase;
(x) the Corporation shall use its commercial best efforts to satisfy the Release Conditions prior to the Release Deadline, including seeking any extensions or waivers necessary to keep the Offer to Purchase in full force and effect until the Qualification Deadline as necessary;
(y) the Corporation shall use its commercial best efforts to enforce its rights against CryptoLogic and its affiliates under the Offer to Purchase;
(z) the Corporation shall notify Canaccord Genuity in writing of the receipt of all regulatory approvals required to complete the Acquisition;
(aa) as Final Prospectus containing a condition precedent to the execution of the joint notice by Canaccord Genuity with the Corporation in respect of the Release Event pursuant to the Release Conditions, the Chief Executive Officer of the Corporation shall have delivered to Canaccord Genuity a certification that all conditions to the completion of the Acquisition by the Corporation, on terms previously disclosed to or otherwise reasonably acceptable to Canaccord Genuity, have been satisfied or waivedmisrepresentation; and
(bb) in the event that the Release Event does not occur on or before the Release Deadline, the Corporation shall forthwith deliver a notice to each of the Special Warrant holders and the Agent and the Agent shall return, within three Business Days, to each such holder the applicable subscription amount, plus any interest earned thereon, less applicable withholding taxes, if any, and the Special Warrants shall be cancelled. The Corporation shall be responsible for any shortfall in the aggregate subscription amount payable to Special Warrant holders.or
Appears in 1 contract
Corporation’s Covenants. The Corporation hereby covenants to the Underwriters and to the Purchasers and their permitted assigns, and acknowledges that each of them is relying on such covenants in purchasing the Special Warrants, that the Corporation shallwill:
(a) prior to the Closing Time and at all times until a Final Receipt is issued, allow the Underwriters (and their counsel and consultants) to conduct all due diligence which the Underwriters may reasonably require or which may be considered necessary or appropriate Agree that any certificate signed by the Underwriters. The Corporation will provide to the Underwriters (and their counsel) reasonable access to the Corporation’s senior management personnel and corporate, financial and other records, for the purposes of conducting such due diligence. Without limiting the scope of the due diligence inquiry that the Underwriters (or their counsel) may conduct, the Corporation shall also make available its directors, senior management, the Chairman of the Audit Committee of the Board of Directors, the auditors and counsel to answer any questions which the Underwriters may have and to participate in one or more due diligence sessions to be held prior to Closing and, prior to filing each of the Preliminary Prospectus and Final Prospectus and to use its commercial best efforts to arrange for the auditors an officer of the Corporation and delivered to participate in any such due diligence session;the Underwriter shall be deemed a representation and warranty by the Corporation to the Underwriter as to the statements made therein.
(b) duly execute Promptly from time to time take such action as the Subscription Agreements which have been duly completed by Underwriter may reasonably request to qualify the Purchasers subject Bonds for offering and sale under the Blue Sky or other securities laws of such jurisdictions as the Underwriter may request and to comply with such laws so as to permit the terms thereofcontinuance of sales and dealings in such jurisdictions for as long as may be necessary to complete the distribution, and duly and punctually perform all provided that in connection therewith the obligations Corporation shall not be required to be performed by it under this Agreement and the Subscription Agreements;qualify as a foreign corporation or to file a general consent to service of process in any jurisdiction.
(c) use its commercial best efforts to fulfil or cause to be fulfilledIf, at or prior to the Closing Date, each of the conditions required to be fulfilled by it set out in section 7 hereof;
(d) use its commercial best efforts to obtain the necessary approval of the TSXV for the Offering and the listing of the Underlying Securities on such terms as are customary;
(e) file with the Canadian Securities Regulators and the TSXV all forms, notices and certificates required to be filed by the Corporation pursuant to the Canadian Securities Laws and the policies of the TSXV in the time required by the Canadian Securities Laws and the policies of the TSXV, including, for greater certainty, Form 45-106F1 of NI 45-106 and any other forms, notices and certificates set forth in the opinions delivered to the Underwriters pursuant to the closing conditions set forth in section 7 hereof, as are required to be filed by the Corporation;
(f) ensure that the Underlying Shares, upon issuance, shall be duly issued as fully paid and non-assessable Common Shares, and shall have the attributes corresponding in all material respects to the description thereof set forth in this Agreement and the Subscription Agreements;
(g) fulfil all legal requirements to permit the creation, issuance, offering and sale of the Special Warrants and the Underlying Securities, all as contemplated in this Agreement and file or cause to be filed all documents, applications, forms or undertakings required to be filed by the Corporation and take or cause to be taken all action required to be taken by the Corporation in connection with the purchase and sale of the Special Warrants and the issuance of the Qualified Securities, so that the distribution of the Qualified Securities may lawfully occur without the necessity of filing a registration statement in the United States or similar document in any other jurisdiction;
(h) until after the date of this Bond Purchase Agreement and until twenty-five (25) days after the completion “end of the distribution of underwriting period” as defined in Rule 15c2-12, any event shall occur that might or would cause the Qualified Securities, use commercial best efforts to ensure the Prospectus complies at all times with Canadian Securities Laws;
(i) during the period from the date hereof until the date of the completion of the distribution of the Qualified Securities, promptly inform the Underwriters of the full particulars of any request of any Securities Regulator for any information, or the receipt by the Corporation of any communication from any Securities Regulator or any other competent authority relating to the Corporation or which may be relevant to the distribution of the Qualified Securities;
(j) apply the net proceeds from the Offering to fund the Acquisition;
(k) comply with each of the covenants of the Corporation set out information contained in the Subscription Agreements;
(l) advise the Underwriters, promptly after receiving notice thereof, Official Statement to contain any untrue statement of the time when the Preliminary Prospectus, the Final Prospectus and any Supplementary Material have been filed and receipts therefor have been obtained pursuant to NP 11-202 and will provide evidence reasonably satisfactory to the Underwriters of each such filing and copies of such receipts;
(m) advise the Underwriters, promptly after receiving notice or obtaining knowledge thereof, of:
(i) the issuance by any Canadian Securities Regulator of any order suspending or preventing the use of the Prospectus or any Supplementary Material;
(ii) the institution, threatening or contemplation of any proceeding for any such purposes;
(iii) any order, ruling, or determination having the effect of suspending the sale or ceasing the trading in any securities of the Corporation (including the Special Warrants or the Underlying Securities) having been issued by any Canadian Securities Regulator or the institution, threatening or contemplation of any proceeding for any such purposes; or
(iv) any requests made by any Canadian Securities Regulators to amend or supplement the Prospectus a material fact or to provide additional information, and will use its commercial best efforts omit to prevent the issuance of any order referred to in (i) above and, if any such order is issued, to obtain the withdrawal thereof as quickly as possible;
(n) except to the extent the Corporation participates in state a merger or business combination transaction which is in the best interest of the Corporation and following which the Corporation is not a “reporting issuer”, use its commercial best efforts to maintain its status as a “reporting issuer” (or the equivalent thereof) not in default of the requirements of Canadian Securities Laws of each of the Canadian jurisdictions in which it is currently a reporting issuer, which have such a concept to the date which is two years following the Closing Date; and
(o) except to the extent the Corporation participates in a merger or business combination transaction which is in the best interest of the Corporation and following which the Corporation is not listed on the TSXV or the TSX, use its commercial best efforts to maintain the listing of:
(i) the Common Shares on the TSXV or the TSX or such other recognized stock exchange or quotation system as Canaccord Genuity, on behalf of the Underwriters, may approve, acting reasonably, to the date that is two years following the Closing Date; and
(ii) the Convertible Debentures and the Warrants on the TSXV or the TSX or such other recognized stock exchange or quotation system as Canaccord Genuity, on behalf of the Underwriters, may approve, acting reasonably, until the Maturity Date or Expiry Date, as applicable. The Corporation further hereby covenants to the Underwriters and to the Purchasers and their permitted assigns, and acknowledges that each of them is relying on such covenants in purchasing the Special Warrants, that following the Closing:
(p) the Corporation shall qualify the distribution of the Qualified Securities in the Qualifying Provinces to holders of the Special Warrants and file the Preliminary Prospectus in each of the Qualifying Provinces as soon as possible following the Closing Date and the Final Prospectus promptly following receipt and settlement of comments from the Canadian Securities Regulators;
(q) the Corporation shall use its commercial best efforts to: satisfy all comments with respect to the Preliminary Prospectus; prepare and file the Final Prospectus under Canadian Securities Laws; obtain the Final Receipt (in accordance with the procedures of prospectus review in multiple jurisdictions provided for under NP 11-202), and take all other steps and proceedings that may be material fact necessary to be taken by the Corporation in order to qualify the Qualified Securities for distribution in each of the Qualifying Provinces under Canadian Securities Laws, as soon as practicable following the Closing Date and, in any event, prior to the Qualification Deadline;
(r) the Corporation shall allow the Underwriters to participate in the preparation of the Prospectus and any Supplementary Material that the Corporation is required to file under Canadian Securities Laws relating to the Offering;
(s) the delivery of the Final Prospectus and any Supplementary Material to the Underwriters by the Corporation in accordance with this Agreement will constitute the representation and warranty of the Corporation to the Underwriters that (except for information and statements relating solely to the Underwriters and furnished by them specifically for use in the Final Prospectus), at the respective times of delivery:
(i) the information and statements contained in each of the Final Prospectus and any Supplementary Material:
(A) are true and correct and contain no misrepresentation; and
(B) constitute full, true and plain disclosure of all material facts relating to the Qualified Securities and the Corporation considered as a whole;
(ii) no material fact has been omitted from any of the Final Prospectus and any Supplementary Material that is required to be stated in the document or is necessary to make the statements therein not misleading made therein, in the light of the circumstances in under which they were made; and
(iii) , not misleading, the Final Prospectus Corporation shall so notify the Issuer and the Supplementary Material comply Underwriter. If, in all material respects with Canadian Securities Laws;
(t) the reasonable opinion of the Underwriter or counsel for the Underwriter, such event requires the preparation and publication of an amendment of or a supplement to the Official Statement, the Corporation will deliver cause the Official Statement to be amended or supplemented in form and substance satisfactory to the UnderwritersUnderwriter and the Issuer, without charge, contemporaneously with, and all expenses thereby incurred will be paid by the Corporation if such amendment or supplement is prepared and furnished to the Underwriter on or prior to the filing of, twenty-fifth day following the Final Prospectus, unless otherwise indicated:
(i) a copy of any document filed with, or delivered to, Closing. After the Canadian Securities Regulators by twenty-fifth day following the Corporation under Canadian Securities Laws with the Final Prospectus;
(ii) a certificate dated the date of the Final Prospectus, addressed to the Underwriters and signed by the Chief Executive Officer and Chief Financial Officer of the Corporation, certifying for and on behalf of the Corporation, and not in their personal capacities, after having made due inquiries, with respect to the following matters:
(A) the Corporation having complied with all of the covenants and satisfied all of the terms and conditions of this Agreement on its part to be complied with and satisfied at or prior to the date of the Final Prospectus;
(B) no order, ruling or determination having the effect of ceasing or suspending trading in any securities of the Corporation or prohibiting the issue of the Special Warrants or the Underlying Securities or any of the Corporation’s issued securities having been issued and no proceeding for such purpose being pending or, to the knowledge of such officers, threatened;
(C) the representations and warranties of the Corporation contained in this Agreement and in any certificates of Corporation delivered pursuant to or in connection with this Agreement being true and correct as at the date of the Final Prospectus, with the same force and effect as if made on and as at the date of the Final Prospectus, after giving effect to the transactions contemplated by this Agreement; and
(D) since the Closing Time, there having been no material adverse change, financial or otherwise, in the assets, liabilities (contingent or otherwise), capital, business or results of operations of the Corporation;
(u) the Corporation shall deliver opinions, comfort letters and other documents substantially similar to those referred to in this section 1 to Canaccord Genuity and the Underwriters’ counsel, as applicable, with respect to any Supplementary Material, contemporaneously with, or prior to the filing of, any Supplementary Material;
(v) until the earlier of the Qualification Date and the Qualification DeadlineClosing, the Corporation shall deliver not have any liability for expenses incurred in the preparation and publication of an amendment or supplement to the Underwriters copies of all correspondence and other written communications between the Corporation and any Securities Regulators Official Statement, unless such amendment or other Governmental Authority supplement is necessitated by an event relating to the Offering and information contained in the Acquisition and will generally keep the Underwriters apprised of the status of, including all developments Official Statement relating to, the Offering, the Acquisition, and satisfaction of closing conditions for the Acquisition and the Release Conditions;
(w) to the Corporation shall comply with and satisfy, in all material respects, all terms, conditions and covenants in or any affiliate of any Corporation. For the Offer to Purchase;
(x) the Corporation shall use its commercial best efforts to satisfy the Release Conditions prior to the Release Deadline, including seeking any extensions or waivers necessary to keep the Offer to Purchase in full force and effect until the Qualification Deadline as necessary;
(y) the Corporation shall use its commercial best efforts to enforce its rights against CryptoLogic and its affiliates under the Offer to Purchase;
(z) the Corporation shall notify Canaccord Genuity in writing purposes of the receipt of all regulatory approvals required to complete the Acquisition;
(aa) as a condition precedent to the execution of the joint notice by Canaccord Genuity with the Corporation in respect of the Release Event pursuant to the Release Conditions, the Chief Executive Officer of the Corporation shall have delivered to Canaccord Genuity a certification that all conditions to the completion of the Acquisition by the Corporation, on terms previously disclosed to or otherwise reasonably acceptable to Canaccord Genuity, have been satisfied or waived; and
(bb) in the event that the Release Event does not occur on or before the Release Deadlinethis Section 8(c), the Corporation shall forthwith deliver a notice will furnish such information with respect to each itself and the refunding of the Special Warrant holders and Prior Bonds as the Agent and the Agent shall return, within three Business Days, Underwriter reasonably may from time to each such holder the applicable subscription amount, plus any interest earned thereon, less applicable withholding taxes, if any, and the Special Warrants shall be cancelled. The Corporation shall be responsible for any shortfall in the aggregate subscription amount payable to Special Warrant holderstime request.
Appears in 1 contract
Corporation’s Covenants. The Corporation hereby makes the following covenants to the Underwriters and to the Purchasers and their permitted assigns, and acknowledges that each of them is relying on such covenants in purchasing the Special Warrants, that the Corporation shallOffered Shares:
(a) Until the date on which the distribution of the Offered Shares is completed, the Corporation will promptly take, or cause to be taken, all additional steps and proceedings that may from time to time be required under Applicable Securities Laws to continue to qualify the distribution of the Offered Shares or, in the event that the Offered Shares or any of them, have, for any reason, ceased to so qualify, to so qualify again such securities, as applicable, for distribution under Applicable Securities Laws. The Underwriters shall be entitled to assume that the Offered Shares are registered or qualified, as applicable, for distribution in the United States and in any Canadian Qualifying Jurisdiction where the Final Passport System Decision Document shall have been obtained.
(b) The Corporation shall, concurrently with the execution of this Agreement, prepare and file in accordance with Canadian Securities Laws and U.S. Securities Laws, the Supplemented Prospectuses and any other required documents relating to the proposed distribution of the Offered Shares in the Canadian Qualifying Jurisdictions and in the United States, and take all other steps and proceedings that may be necessary to be taken by the Corporation in order to qualify the Offered Shares for distribution in each of the Canadian Qualifying Jurisdictions under Canadian Securities Laws and to register the Offering in the United States under U.S. Securities Laws.
(c) Prior to the filing of the Offering Documents, the Corporation shall have permitted or permit, as the case may be, the Underwriters to review and participate in the preparation thereof (other than Documents Incorporated by Reference filed prior to the Closing Time date hereof), and shall allow each of the Underwriters to conduct any due diligence investigations which any of them reasonably requires in order to fulfill its obligations under Applicable Securities Laws, including, as applicable, in order to enable it to responsibly execute the certificate in the Canadian Offering Documents.
(d) Prior to and at all times until a Final Receipt is issuedthe Closing Time and any Option Closing Time, the Corporation will allow the Underwriters (and their counsel and consultants) to conduct all due diligence which the Underwriters may reasonably require or which may be considered necessary or appropriate by the Underwriters. The Corporation will provide or will have provided to the Underwriters (and their counsel) reasonable access to the Corporation’s properties, senior management personnel and corporate, financial and other records, for the purposes of conducting such due diligence. Without limiting the scope of the due diligence inquiry that the Underwriters (or their counsel) may conduct, the Corporation has used and shall also continue to use its best efforts to make available its directors, senior management, the Chairman of the Audit Committee of the Board of Directors, the auditors and counsel to answer any questions which the Underwriters may have have, acting reasonably, and to participate in one or more due diligence sessions (such questions to be distributed reasonably in advance of each session) to be held prior to Closing and, the filing of the Supplemented Prospectuses and prior to filing each of the Preliminary Prospectus Closing and Final Prospectus and any Over-Allotment Closing.
(e) The Corporation covenants to use its commercial best commercially reasonable efforts to arrange for the auditors of the Corporation to participate in any such due diligence session;
(b) duly execute the Subscription Agreements which have been duly completed by the Purchasers subject to the terms thereof, and duly and punctually perform all the obligations to be performed by it under this Agreement and the Subscription Agreements;
(c) use its commercial best efforts to fulfil fulfill or cause to be fulfilled, at or prior to the Closing Date, each of the conditions required to be fulfilled by it set out in section 7 hereof;
(d) use its commercial best efforts to obtain the necessary approval of the TSXV for the Offering and the listing of the Underlying Securities on such terms as are customary;
(e) file with the Canadian Securities Regulators and the TSXV all forms, notices and certificates required to be filed by the Corporation pursuant to the Canadian Securities Laws and the policies of the TSXV in the time required by the Canadian Securities Laws and the policies of the TSXV, including, for greater certainty, Form 45-106F1 of NI 45-106 and any other forms, notices and certificates set forth in the opinions delivered to the Underwriters pursuant to the closing conditions set forth in section 7 hereof, as are required to be filed by the Corporation;Section 7.
(f) ensure that the Underlying Shares, upon issuance, shall be duly issued as fully paid and non-assessable Common Shares, and shall have the attributes corresponding in all material respects The Corporation covenants to the description thereof set forth in this Agreement and the Subscription Agreements;
(g) fulfil fulfill all legal requirements to permit the creation, issuance, offering and sale of the Special Warrants and the Underlying SecuritiesOffered Shares, all as contemplated in this Agreement and to file or cause to be filed all documents, applications, forms or undertakings required to be filed by the Corporation and take or cause to be taken all action required to be taken by the Corporation in connection with the purchase and sale of the Special Warrants and the issuance of the Qualified Securities, so that the distribution of the Qualified Securities may lawfully occur without the necessity of filing a registration statement in the United States or similar document in any other jurisdiction;Offered Shares.
(hg) until Until the date of the completion of the distribution of the Qualified SecuritiesOffered Shares, the Corporation covenants to use commercial best commercially reasonable efforts to ensure the Prospectus complies Offering Documents comply at all times with Canadian Applicable Securities Laws;.
(ih) during During the period from the date hereof until the date later of the Closing Date or the Option Closing Date, as applicable, and the completion of the distribution of the Qualified SecuritiesOffered Shares, the Corporation covenants to promptly inform the Underwriters of the full particulars of any request of any Securities Regulator securities regulatory authority for any information, or the receipt by the Corporation of any communication from any securities regulatory authority (including the Canadian Securities Regulator Regulators and the SEC) or any other competent authority relating to the Corporation or which may be relevant to the issuance of the Offered Shares.
(i) During the period from the date hereof until completion of the distribution of the Qualified Securities;Offered Shares, the Corporation covenants to promptly provide to the Underwriters and the Underwriters’ counsel, prior to the publication, filing or issuance thereof, any communication to the public, and will not publish those communications (unless otherwise required by Applicable Securities Laws) except with the prior approval of the Lead Underwriter, on behalf of the Underwriters, acting reasonably and without delay.
(j) The Corporation covenants to apply the net proceeds from the Offering to fund in accordance with the Acquisition;parameters described in the Prospectuses.
(k) comply with each The Corporation covenants to advise the Underwriters promptly of the covenants filing of the Corporation set out in Supplemented Prospectuses (and any related documents) and will provide evidence satisfactory to the Subscription Agreements;Underwriters, acting reasonably, of such filing.
(l) advise the Underwriters, promptly after receiving notice thereof, of the time when the Preliminary Prospectus, the Final Prospectus and any Supplementary Material have been filed and receipts therefor have been obtained pursuant The Corporation covenants to NP 11-202 and will provide evidence reasonably satisfactory to the Underwriters of each such filing and copies of such receipts;
(m) advise the Underwriters, promptly after receiving notice or obtaining knowledge thereof, of:
(i) the issuance by any Canadian Securities Regulator or the SEC of any order suspending or preventing the use of the Prospectus Offering Documents or any Supplementary Material;
(ii) the institution, threatening or contemplation of any proceeding for any such purposes;
(iiiii) any order, ruling, or determination having the effect of suspending the sale or ceasing the trading in the Common Shares or any securities of the Corporation (including the Special Warrants or the Underlying Securities) having been issued by any Canadian Securities Regulator or the SEC or the institution, threatening or contemplation of any proceeding for any such purposes; or
(iviii) any requests made by any Canadian Securities Regulators to amend Regulator or supplement the Prospectus SEC for amending or to provide supplementing the Offering Documents or for additional information, and will use its commercial best commercially reasonable efforts to prevent the issuance of any order referred to in (i) above and, if any such order is issued, to obtain the withdrawal thereof as quickly as possible;.
(nm) except to the extent the The Corporation participates in covenants that, for a merger or business combination transaction which is in the best interest period of the Corporation and following which the Corporation is not a “reporting issuer”, use its commercial best efforts to maintain its status as a “reporting issuer” (or the equivalent thereof) not in default of the requirements of Canadian Securities Laws of each of the Canadian jurisdictions in which it is currently a reporting issuer, which have such a concept to the date which is two years following one year after the Closing Date; and
(o) except to the extent the Corporation participates in a merger or business combination transaction which is in the best interest of the Corporation and following which the Corporation is not listed on the TSXV or the TSX, use its commercial best efforts to maintain the listing of:
(i) the Common Shares on the TSXV or the TSX or such other recognized stock exchange or quotation system as Canaccord Genuity, on behalf of the Underwriters, may approve, acting reasonably, to the date that is two years following the Closing Date; and
(ii) the Convertible Debentures and the Warrants on the TSXV or the TSX or such other recognized stock exchange or quotation system as Canaccord Genuity, on behalf of the Underwriters, may approve, acting reasonably, until the Maturity Date or Expiry Date, as applicable. The Corporation further hereby covenants to the Underwriters and to the Purchasers and their permitted assigns, and acknowledges that each of them is relying on such covenants in purchasing the Special Warrants, that following the Closing:
(p) the Corporation shall qualify the distribution of the Qualified Securities in the Qualifying Provinces to holders of the Special Warrants and file the Preliminary Prospectus in each of the Qualifying Provinces as soon as possible following the Closing Date and the Final Prospectus promptly following receipt and settlement of comments from the Canadian Securities Regulators;
(q) the Corporation shall use its reasonable commercial best efforts to: satisfy all comments with respect to effect and maintain the Preliminary Prospectus; prepare and file the Final Prospectus under Canadian Securities Laws; obtain the Final Receipt (in accordance with the procedures of prospectus review in multiple jurisdictions provided for under NP 11-202), and take all other steps and proceedings that may be necessary to be taken by the Corporation in order to qualify the Qualified Securities for distribution in each listing of the Qualifying Provinces under Canadian Securities Laws, as soon as practicable following Common Shares (including the Closing Date and, in any event, prior to Offered Shares) on NASDAQ and the Qualification Deadline;TSX.
(rn) the The Corporation shall allow the Underwriters to participate in the preparation of the Prospectus Supplemented Prospectuses and any Supplementary Material Prospectus Amendment that the Corporation is required to file under Canadian Applicable Securities Laws relating to the Offering;.
(so) the delivery of the Final Prospectus and any Supplementary Material The Corporation covenants to the Underwriters by the Corporation in accordance with this Agreement will constitute the representation and warranty of the Corporation to the Underwriters that (except for information and statements relating solely to the Underwriters and furnished by them specifically for use in the Final Prospectus), at the respective times of delivery:
(i) the information and statements contained in each of the Final Prospectus and any Supplementary Material:
(A) are true and correct and contain no misrepresentation; and
(B) constitute full, true and plain disclosure of all material facts relating to the Qualified Securities and the Corporation considered as a whole;
(ii) no material fact has been omitted from any of the Final Prospectus and any Supplementary Material that is required to be stated in the document or is necessary to make the statements therein not misleading in the light of the circumstances in which they were made; and
(iii) the Final Prospectus and the Supplementary Material comply in all material respects with Canadian Securities Laws;
(t) the Corporation will deliver to the Underwriters, without charge, contemporaneously with, or prior to the filing of, the Final ProspectusSupplemented Prospectuses, unless otherwise indicated:
(i) , a copy of any document filed with, or delivered to, the Canadian Securities Regulators or the SEC by the Corporation under Canadian Applicable Securities Laws with the Final Supplemented Prospectus;.
(iip) a certificate dated the date of the Final Prospectus, addressed to the Underwriters and signed by the Chief Executive Officer and Chief Financial Officer of the Corporation, certifying for and on behalf of the Corporation, and not in their personal capacities, after having made due inquiries, with respect to the following matters:
(A) the Corporation having complied with all of the covenants and satisfied all of the terms and conditions of this Agreement on its part to be complied with and satisfied at or prior to the date of the Final Prospectus;
(B) no order, ruling or determination having the effect of ceasing or suspending trading in any securities of the Corporation or prohibiting the issue of the Special Warrants or the Underlying Securities or any of the Corporation’s issued securities having been issued and no proceeding for such purpose being pending or, to the knowledge of such officers, threatened;
(C) the representations and warranties of the Corporation contained in this Agreement and in any certificates of Corporation delivered pursuant to or in connection with this Agreement being true and correct as at the date of the Final Prospectus, with the same force and effect as if made on and as at the date of the Final Prospectus, after giving effect to the transactions contemplated by this Agreement; and
(D) since the Closing Time, there having been no material adverse change, financial or otherwise, in the assets, liabilities (contingent or otherwise), capital, business or results of operations of the Corporation;
(u) the The Corporation shall deliver opinions, comfort letters and other documents substantially similar to those referred to in this section 1 Section 7, as applicable, to Canaccord Genuity the Underwriters and the Underwriters’ legal counsel, as applicable, with respect to any Supplementary Materialamendment or supplement to the Supplemented Prospectuses, contemporaneously with, or prior to the filing of, any Supplementary Material;such document.
(vq) until The Corporation hereby acknowledges that the earlier Customer Due Diligence Requirements for Financial Institutions Rule (the “CDD Rule”) promulgated by the Financial Crimes Enforcement Network (“FinCEN”) require the Underwriters to identify and verify the identity of beneficial owners of its legal entity clients. Unless an exemption to the Qualification Date and the Qualification DeadlineCDD Rule applies, the Corporation shall deliver agrees to the Underwriters copies of all correspondence cooperate with, and other written communications between the Corporation and any Securities Regulators or other Governmental Authority relating to the Offering and the Acquisition and will generally keep the Underwriters apprised of the status of, including all developments relating provide to, the Offering, the Acquisition, Underwriters all information and satisfaction of closing conditions for the Acquisition and the Release Conditions;
(w) the Corporation shall documents required by FinCEN in order to comply with and satisfy, in all material respects, all terms, conditions and covenants in the Offer to Purchase;
(x) the Corporation shall use its commercial best efforts to satisfy the Release Conditions prior to the Release Deadline, including seeking any extensions or waivers necessary to keep the Offer to Purchase in full force and effect until the Qualification Deadline as necessary;
(y) the Corporation shall use its commercial best efforts to enforce its rights against CryptoLogic and its affiliates under the Offer to Purchase;
(z) the Corporation shall notify Canaccord Genuity in writing of the receipt of all regulatory approvals required to complete the Acquisition;
(aa) as a condition precedent to the execution of the joint notice by Canaccord Genuity with the Corporation in respect of the Release Event pursuant to the Release Conditions, the Chief Executive Officer of the Corporation shall have delivered to Canaccord Genuity a certification that all conditions to the completion of the Acquisition by the Corporation, on terms previously disclosed to or otherwise reasonably acceptable to Canaccord Genuity, have been satisfied or waived; and
(bb) in the event that the Release Event does not occur on or before the Release Deadline, the Corporation shall forthwith deliver a notice to each of the Special Warrant holders and the Agent and the Agent shall return, within three Business Days, to each such holder the applicable subscription amount, plus any interest earned thereon, less applicable withholding taxes, if any, and the Special Warrants shall be cancelled. The Corporation shall be responsible for any shortfall in the aggregate subscription amount payable to Special Warrant holdersCDD Rule.
Appears in 1 contract
Corporation’s Covenants. The Corporation hereby makes the following covenants to the Underwriters and to the Purchasers and their permitted assignsAgents, and acknowledges that each of them is relying on such covenants in purchasing the Special Warrants, that the Corporation shall:Offered Units.
(a) prior to The Corporation shall, concurrently with the Closing Time execution and at all times until a Final Receipt is issued, allow the Underwriters (and their counsel and consultants) to conduct all due diligence which the Underwriters may reasonably require or which may be considered necessary or appropriate delivery of this Agreement by the Underwriters. The Corporation will provide to the Underwriters (and their counsel) reasonable access to the Corporation’s senior management personnel and corporateparties hereto, financial and other records, for the purposes of conducting such due diligence. Without limiting the scope of the due diligence inquiry that the Underwriters (or their counsel) may conduct, the Corporation shall also make available its directors, senior management, the Chairman of the Audit Committee of the Board of Directors, the auditors and counsel to answer any questions which the Underwriters may have and to participate in one or more due diligence sessions to be held prior to Closing and, prior to filing each of the Preliminary Prospectus and Final Prospectus and to use its commercial best efforts to arrange for the auditors of the Corporation to participate in any such due diligence session;
(b) duly execute the Subscription Agreements which have been duly completed by the Purchasers subject to the terms thereof, and duly and punctually perform all the obligations to be performed by it file under this Agreement and the Subscription Agreements;
(c) use its commercial best efforts to fulfil or cause to be fulfilled, at or prior to the Closing Date, each of the conditions required to be fulfilled by it set out in section 7 hereof;
(d) use its commercial best efforts to obtain the necessary approval of the TSXV for the Offering and the listing of the Underlying Securities on such terms as are customary;
(e) file with the Canadian Securities Regulators and the TSXV all forms, notices and certificates required to be filed by the Corporation pursuant to the Canadian Securities Laws the Amended and the policies of the TSXV in the time required by the Canadian Securities Laws and the policies of the TSXV, including, for greater certainty, Form 45-106F1 of NI 45-106 and any other forms, notices and certificates set forth in the opinions delivered to the Underwriters pursuant to the closing conditions set forth in section 7 hereof, as are required to be filed by the Corporation;
(f) ensure that the Underlying Shares, upon issuance, shall be duly issued as fully paid and non-assessable Common Shares, and shall have the attributes corresponding in all material respects to the description thereof set forth in this Agreement and the Subscription Agreements;
(g) fulfil all legal requirements to permit the creation, issuance, offering and sale of the Special Warrants and the Underlying Securities, all as contemplated in this Agreement and file or cause to be filed all documents, applications, forms or undertakings required to be filed by the Corporation and take or cause to be taken all action required to be taken by the Corporation in connection with the purchase and sale of the Special Warrants and the issuance of the Qualified Securities, so that the distribution of the Qualified Securities may lawfully occur without the necessity of filing a registration statement in the United States or similar document in any other jurisdiction;
(h) until the date of the completion of the distribution of the Qualified Securities, use commercial best efforts to ensure the Prospectus complies at all times with Canadian Securities Laws;
(i) during the period from the date hereof until the date of the completion of the distribution of the Qualified Securities, promptly inform the Underwriters of the full particulars of any request of any Securities Regulator for any information, or the receipt by the Corporation of any communication from any Securities Regulator or any other competent authority relating to the Corporation or which may be relevant to the distribution of the Qualified Securities;
(j) apply the net proceeds from the Offering to fund the Acquisition;
(k) comply with each of the covenants of the Corporation set out in the Subscription Agreements;
(l) advise the Underwriters, promptly after receiving notice thereof, of the time when the Preliminary Prospectus, the Restated Final Prospectus and any Supplementary Material have been filed and receipts therefor have been obtained pursuant to NP 11-202 and will provide evidence reasonably satisfactory other required documents relating to the Underwriters of each such filing and copies of such receipts;
(m) advise the Underwriters, promptly after receiving notice or obtaining knowledge thereof, of:
(i) the issuance by any Canadian Securities Regulator of any order suspending or preventing the use of the Prospectus or any Supplementary Material;
(ii) the institution, threatening or contemplation of any proceeding for any such purposes;
(iii) any order, ruling, or determination having the effect of suspending the sale or ceasing the trading in any securities of the Corporation (including the Special Warrants or the Underlying Securities) having been issued by any Canadian Securities Regulator or the institution, threatening or contemplation of any proceeding for any such purposes; or
(iv) any requests made by any Canadian Securities Regulators to amend or supplement the Prospectus or to provide additional information, and will use its commercial best efforts to prevent the issuance of any order referred to in (i) above and, if any such order is issued, to obtain the withdrawal thereof as quickly as possible;
(n) except to the extent the Corporation participates in a merger or business combination transaction which is in the best interest of the Corporation and following which the Corporation is not a “reporting issuer”, use its commercial best efforts to maintain its status as a “reporting issuer” (or the equivalent thereof) not in default of the requirements of Canadian Securities Laws of each of the Canadian jurisdictions in which it is currently a reporting issuer, which have such a concept to the date which is two years following the Closing Date; and
(o) except to the extent the Corporation participates in a merger or business combination transaction which is in the best interest of the Corporation and following which the Corporation is not listed on the TSXV or the TSX, use its commercial best efforts to maintain the listing of:
(i) the Common Shares on the TSXV or the TSX or such other recognized stock exchange or quotation system as Canaccord Genuity, on behalf of the Underwriters, may approve, acting reasonably, to the date that is two years following the Closing Date; and
(ii) the Convertible Debentures and the Warrants on the TSXV or the TSX or such other recognized stock exchange or quotation system as Canaccord Genuity, on behalf of the Underwriters, may approve, acting reasonably, until the Maturity Date or Expiry Date, as applicable. The Corporation further hereby covenants to the Underwriters and to the Purchasers and their permitted assigns, and acknowledges that each of them is relying on such covenants in purchasing the Special Warrants, that following the Closing:
(p) the Corporation shall qualify the proposed distribution of the Qualified Securities Offered Units in the Qualifying Provinces Jurisdictions, and obtain, pursuant to holders of the Special Warrants and file the Preliminary Prospectus in each of the Qualifying Provinces as soon as possible following the Closing Date and Passport System, the Final Prospectus promptly following receipt and settlement of comments from the Canadian Securities Regulators;
(q) the Corporation shall use its commercial best efforts to: satisfy all comments with respect to the Preliminary Prospectus; prepare and file the Final Prospectus under Canadian Securities Laws; obtain the Final Receipt (in accordance with the procedures of prospectus review in multiple jurisdictions provided for under NP 11-202)Receipt, and take all other steps and proceedings that may be necessary to be taken by the Corporation in order to qualify the Qualified Securities Offered Units for distribution in each of the Qualifying Provinces under Canadian Securities Laws, as soon as practicable following the Closing Date and, in any event, prior to the Qualification Deadline;
(r) the Corporation shall allow the Underwriters to participate in the preparation of the Prospectus and any Supplementary Material that the Corporation is required to file Jurisdictions under Canadian Securities Laws relating to on or before 5:00 p.m. (Toronto time) on the Offering;Business Day following the date hereof.
(sb) Until the delivery earlier of the Final Prospectus and any Supplementary Material to date on which the Underwriters by distribution of the Corporation in accordance with Offered Units is completed or this Agreement will constitute the representation and warranty of the Corporation to the Underwriters that (except for information and statements relating solely to the Underwriters and furnished by them specifically for use in the Final Prospectus)is terminated, at the respective times of delivery:
(i) the information and statements contained in each of the Final Prospectus and any Supplementary Material:
(A) are true and correct and contain no misrepresentation; and
(B) constitute full, true and plain disclosure of all material facts relating to the Qualified Securities and the Corporation considered as a whole;
(ii) no material fact has been omitted from any of the Final Prospectus and any Supplementary Material that is required to be stated in the document or is necessary to make the statements therein not misleading in the light of the circumstances in which they were made; and
(iii) the Final Prospectus and the Supplementary Material comply in all material respects with Canadian Securities Laws;
(t) the Corporation will deliver to the Underwriters, without charge, contemporaneously withpromptly take, or prior cause to the filing ofbe taken, the Final Prospectus, unless otherwise indicated:
(i) a copy of any document filed with, or delivered to, the Canadian Securities Regulators by the Corporation all additional steps and proceedings that may from time to time be required under Canadian Securities Laws with to continue to qualify the Final Prospectus;
(ii) a certificate dated the date distribution of the Final ProspectusOffered Units or, addressed to in the Underwriters and signed by event that the Chief Executive Officer and Chief Financial Officer of the Corporation, certifying for and on behalf of the Corporation, and not in their personal capacities, after having made due inquiries, with respect to the following matters:
(A) the Corporation having complied with all of the covenants and satisfied all of the terms and conditions of this Agreement on its part to be complied with and satisfied at or prior to the date of the Final Prospectus;
(B) no order, ruling or determination having the effect of ceasing or suspending trading in any securities of the Corporation or prohibiting the issue of the Special Warrants or the Underlying Securities Offered Units or any of the Corporation’s issued securities having been issued and no proceeding them, have, for such purpose being pending orany reason, ceased to so qualify, to the knowledge of so qualify again such officers, threatened;
(C) the representations and warranties of the Corporation contained in this Agreement and in any certificates of Corporation delivered pursuant to or in connection with this Agreement being true and correct as at the date of the Final Prospectus, with the same force and effect as if made on and as at the date of the Final Prospectus, after giving effect to the transactions contemplated by this Agreement; and
(D) since the Closing Time, there having been no material adverse change, financial or otherwise, in the assets, liabilities (contingent or otherwise), capital, business or results of operations of the Corporation;
(u) the Corporation shall deliver opinions, comfort letters and other documents substantially similar to those referred to in this section 1 to Canaccord Genuity and the Underwriters’ counselsecurities, as applicable, with respect to any Supplementary Material, contemporaneously with, or prior to the filing of, any Supplementary Material;for distribution.
(vc) until Provided the earlier of the Qualification Date Agents have timely taken all action required by them hereunder and the Qualification Deadline, under Securities Laws to permit the Corporation shall deliver to the Underwriters copies of all correspondence and other written communications between the Corporation and any Securities Regulators or other Governmental Authority relating to the Offering and the Acquisition and will generally keep the Underwriters apprised of the status ofdo so, including all developments relating to, the Offering, the Acquisition, and satisfaction of closing conditions for the Acquisition and the Release Conditions;
(w) the Corporation shall comply with and satisfy, in all material respects, all terms, conditions and covenants in the Offer to Purchase;
(x) the Corporation shall use its commercial commercially reasonable best efforts to satisfy secure compliance with all Securities Laws on a timely basis in connection with the Release Conditions prior to distribution of the Release DeadlineOffered Units, including seeking any extensions or waivers necessary to keep the Offer to Purchase in full force and effect until the Qualification Deadline as necessary;
(y) the Corporation shall use its commercial best efforts to enforce its rights against CryptoLogic and its affiliates under the Offer to Purchase;
(z) the Corporation shall notify Canaccord Genuity in writing of the receipt payment of all regulatory approvals filing fees required to complete the Acquisition;
(aa) as a condition precedent to the execution of the joint notice be paid by Canaccord Genuity with the Corporation it in respect of the Release Event pursuant to the Release Conditions, the Chief Executive Officer of the Corporation shall have delivered to Canaccord Genuity a certification that all conditions to the completion of the Acquisition by the Corporation, on terms previously disclosed to or otherwise reasonably acceptable to Canaccord Genuity, have been satisfied or waived; and
(bb) in the event that the Release Event does not occur on or before the Release Deadline, the Corporation shall forthwith deliver a notice to each of the Special Warrant holders and the Agent and the Agent shall return, within three Business Days, to each such holder the applicable subscription amount, plus any interest earned thereon, less applicable withholding taxes, if any, and the Special Warrants shall be cancelled. The Corporation shall be responsible for any shortfall in the aggregate subscription amount payable to Special Warrant holdersconnection therewith.
Appears in 1 contract
Samples: Agency Agreement
Corporation’s Covenants. The Corporation hereby covenants to the Underwriters and to the Purchasers and their permitted assigns, and acknowledges that each of them is relying on such covenants in purchasing the Special Warrants, that the Corporation shallagrees:
(a) prior that the Offered Securities will be duly and validly authorized and issued pursuant to the Closing Time and at all times until a Final Receipt is issued, allow the Underwriters (and their counsel and consultants) to conduct all due diligence which the Underwriters may reasonably require or which may be considered necessary or appropriate by the Underwriters. The Corporation will provide to the Underwriters (and their counsel) reasonable access to the Corporation’s senior management personnel and corporate, financial and other records, for the purposes of conducting such due diligence. Without limiting the scope terms of the due diligence inquiry that the Underwriters (or their counsel) may conduct, the Corporation shall also make available its directors, senior management, the Chairman of the Audit Committee of the Board of Directors, the auditors and counsel to answer any questions which the Underwriters may have and to participate in one or more due diligence sessions to be held prior to Closing and, prior to filing each of the Preliminary Prospectus and Final Prospectus and to use its commercial best efforts to arrange for the auditors of the Corporation to participate in any such due diligence sessionSubscription Agreements;
(b) duly execute the Common Shares issuable upon the conversion of the Debentures will be reserved for issuance at the Closing Time;
(c) as soon as reasonably possible, and in any event by the Closing Date, to take all such steps as may reasonably be necessary to enable the Offered Securities to be offered for sale and sold on a private placement basis to Subscribers in the Selling Jurisdictions through the Agent or any other investment dealers or brokers registered in any of the Selling Jurisdictions by way of the exemptions under Applicable Securities Laws of each of the Selling Jurisdictions, and not to take any action that would prevent the Corporation and the Agent from relying on the exemptions from the prospectus requirements of Applicable Securities Laws as contemplated by the Subscription Agreements which have been duly completed by the Purchasers subject Agreements;
(d) to the terms thereofduly, punctually and duly faithfully perform and punctually perform comply with all the obligations to be performed by it it, and all of its covenants and agreements under and pursuant to this Agreement Agreement, the Subscription Agreements and the Subscription Agreements;
(c) use its commercial best efforts to fulfil or cause to be fulfilled, at or prior to the Closing Date, each of the conditions required to be fulfilled by it set out in section 7 hereof;
(d) use its commercial best efforts to obtain the necessary approval of the TSXV for the Offering and the listing of the Underlying Securities on such terms as are customaryIndenture;
(e) it will file all necessary forms and reports with the Canadian appropriate Securities Regulators Commissions and other regulatory authorities in connection with the issuance of the Offered Securities and the TSXV all forms, notices and certificates required to be filed by the Corporation pursuant to the Canadian Securities Laws and the policies of the TSXV in the time required by the Canadian Securities Laws and the policies of the TSXV, including, for greater certainty, Form 45-106F1 of NI 45-106 and any other forms, notices and certificates set forth in the opinions delivered to the Underwriters pursuant to the closing conditions set forth in section 7 hereof, as are required to be filed by the CorporationAgent’s Warrants;
(f) ensure that the Underlying Shares, upon issuance, shall Corporation will carry on its business in a prudent manner in accordance with industry standards and good business practice and will keep or cause to be duly issued as fully paid and non-assessable Common Shares, and shall have the attributes corresponding kept proper books of accounts in all material respects to the description thereof set forth in this Agreement and the Subscription Agreementsaccordance with applicable law;
(g) fulfil all legal requirements to permit the creation, issuance, offering and sale of the Special Warrants and the Underlying Securities, all as contemplated in this Agreement and file or cause to be filed all documents, applications, forms or undertakings required to be filed by the Corporation and take or cause to be taken all action required to be taken by the Corporation in connection with the purchase and sale of the Special Warrants and the issuance of the Qualified Securitieswill not, so that the distribution of the Qualified Securities may lawfully occur without the necessity of filing a registration statement in the United States or similar document in any other jurisdiction;
(h) until the date of the completion of the distribution of the Qualified Securities, use commercial best efforts to ensure the Prospectus complies at all times with Canadian Securities Laws;
(i) during the period from the date hereof until the date earlier of the completion conversion of all of the distribution issued Debentures into Common Shares or the repayment of all of the Qualified Securitiesissued Debentures (including all interest payable thereon); approve, promptly inform implement, adopt or authorize any stock option plan, performance warrant plan or other stock based compensation plan (collectively, the Underwriters “Option Plan”) which allows for the issuance of Common Shares in an aggregate amount greater than 5% of the full particulars of any request of any Securities Regulator for any information, or the receipt by the Corporation of any communication from any Securities Regulator or any other competent authority relating to the Corporation or which may be relevant to the distribution of the Qualified Securitiesissued and outstanding Common Shares;
(jh) apply the net proceeds Corporation will not, from the Offering to fund date hereof until the Acquisition;
earlier of: (ki) comply with each the conversion of all of the covenants issued Debentures into Common Shares or the repayment of all of the issued Debentures (including all interest payable thereon); or (ii) the date on which the Corporation set out in has completed an offering (or offerings) of securities to the Subscription Agreements;
public for gross proceeds of at least an aggregate of $10,000,000 (l) advise the Underwriterscalculated from November 16, promptly after receiving notice thereof2005), of the time when the Preliminary Prospectus, the Final Prospectus and any Supplementary Material have been filed and receipts therefor have been obtained grant options or similar convertible securities issuable pursuant to NP 11-202 and will provide evidence reasonably satisfactory the Option Plan to the Underwriters of each such filing and copies of such receiptsManagement Group or to any director nominated by Surge U.S. pursuant to the Shareholder Agreement;
(m) advise the Underwriters, promptly after receiving notice or obtaining knowledge thereof, of:
(i) the issuance by any Canadian Securities Regulator of any order suspending or preventing the use of the Prospectus or any Supplementary Material;
(ii) the institutionCorporation will not, threatening or contemplation of any proceeding for any such purposes;
(iii) any order, ruling, or determination having the effect of suspending the sale or ceasing the trading in any securities of the Corporation (including the Special Warrants or the Underlying Securities) having been issued by any Canadian Securities Regulator or the institution, threatening or contemplation of any proceeding for any such purposes; or
(iv) any requests made by any Canadian Securities Regulators to amend or supplement the Prospectus or to provide additional information, and will use its commercial best efforts to prevent the issuance of any order referred to in (i) above and, if any such order is issued, to obtain the withdrawal thereof as quickly as possible;
(n) except to the extent the Corporation participates in a merger or business combination transaction which is in the best interest of the Corporation and following which the Corporation is not a “reporting issuer”, use its commercial best efforts to maintain its status as a “reporting issuer” (or the equivalent thereof) not in default of the requirements of Canadian Securities Laws of each of the Canadian jurisdictions in which it is currently a reporting issuer, which have such a concept to from the date which hereof until that date that is two years 90 days following the Closing Date; and
(o) except , directly or indirectly, sell, or offer to sell, or announce the extent offering of, or enter into or make any agreement or understanding, or announce the making or entry into of any agreement or understanding, to issue, sell or exchange any Common Shares, securities exchangeable or convertible into Common Shares without the prior written consent of the Agent, not to be unreasonably withheld, provided that the foregoing will not restrict the Corporation participates in from granting options pursuant to a merger share option plan or business combination transaction which is in the best interest of the Corporation and following which the Corporation is not listed on the TSXV or the TSX, use its commercial best efforts to maintain the listing of:
(i) the issuing Common Shares on the TSXV or the TSX or such other recognized stock exchange or quotation system as Canaccord Genuity, on behalf exercise of the Underwriters, may approve, acting reasonably, to the date that is two years following the Closing Date; and
(ii) the Convertible Debentures and the Warrants on the TSXV or the TSX or such other recognized stock exchange or quotation system as Canaccord Genuity, on behalf of the Underwriters, may approve, acting reasonably, until the Maturity Date or Expiry Date, as applicable. The Corporation further hereby covenants to the Underwriters and to the Purchasers and their permitted assigns, and acknowledges that each of them is relying on such covenants in purchasing the Special Warrants, that following the Closing:
(p) the Corporation shall qualify the distribution of the Qualified Securities in the Qualifying Provinces to holders of the Special Warrants and file the Preliminary Prospectus in each of the Qualifying Provinces as soon as possible following the Closing Date and the Final Prospectus promptly following receipt and settlement of comments from the Canadian Securities Regulators;
(q) the Corporation shall use its commercial best efforts to: satisfy all comments with respect to the Preliminary Prospectus; prepare and file the Final Prospectus under Canadian Securities Laws; obtain the Final Receipt (in accordance with the procedures of prospectus review in multiple jurisdictions provided for under NP 11-202), and take all other steps and proceedings that may be necessary to be taken by the Corporation in order to qualify the Qualified Securities for distribution in each of the Qualifying Provinces under Canadian Securities Laws, as soon as practicable following the Closing Date and, in any event, prior to the Qualification Deadline;
(r) the Corporation shall allow the Underwriters to participate in the preparation of the Prospectus and any Supplementary Material that the Corporation is required to file under Canadian Securities Laws relating to the Offering;
(s) the delivery of the Final Prospectus and any Supplementary Material to the Underwriters by the Corporation in accordance with this Agreement will constitute the representation and warranty of the Corporation to the Underwriters that (except for information and statements relating solely to the Underwriters and furnished by them specifically for use in the Final Prospectus), at the respective times of delivery:
(i) the information and statements contained in each of the Final Prospectus and any Supplementary Material:
(A) are true and correct and contain no misrepresentation; and
(B) constitute full, true and plain disclosure of all material facts relating to the Qualified Securities and the Corporation considered as a whole;
(ii) no material fact has been omitted from any of the Final Prospectus and any Supplementary Material that is required to be stated in the document or is necessary to make the statements therein not misleading in the light of the circumstances in which they were made; and
(iii) the Final Prospectus and the Supplementary Material comply in all material respects with Canadian Securities Laws;
(t) the Corporation will deliver to the Underwriters, without charge, contemporaneously with, or prior to the filing of, the Final Prospectus, unless otherwise indicated:
(i) a copy of any document filed with, or delivered to, the Canadian Securities Regulators by the Corporation under Canadian Securities Laws with the Final Prospectus;
(ii) a certificate dated the date of the Final Prospectus, addressed to the Underwriters and signed by the Chief Executive Officer and Chief Financial Officer of the Corporation, certifying for and on behalf of the Corporation, and not in their personal capacities, after having made due inquiries, with respect to the following matters:
(A) the Corporation having complied with all of the covenants and satisfied all of the terms and conditions of this Agreement on its part to be complied with and satisfied at or prior to the date of the Final Prospectus;
(B) no order, ruling or determination having the effect of ceasing or suspending trading in any outstanding securities of the Corporation or prohibiting the issue of the Special Warrants or the Underlying Securities or any of the Corporation’s issued securities having been issued and no proceeding for such purpose being pending or, to the knowledge of such officers, threatened;
(C) the representations and warranties of the Corporation contained in this Agreement and in any certificates of Corporation delivered pursuant to or in connection with this Agreement being true and correct as at the date of the Final Prospectus, with the same force and effect as if made on and as at the date of the Final Prospectus, after giving effect to the transactions contemplated by this Agreement; and
(D) since the Closing Time, there having been no material adverse change, financial or otherwise, in the assets, liabilities (contingent or otherwise), capital, business or results of operations of the Corporation;
(uj) to keep proper books, records and accounts of all Qualifying Expenditures and all transactions affecting the Corporation shall deliver opinions, comfort letters and other documents substantially similar to those referred to in this section 1 to Canaccord Genuity Commitment Amount and the Underwriters’ counselQualifying Expenditures and upon reasonable notice and on a reasonable basis, as applicableto make such books, with respect to any Supplementary Material, contemporaneously with, or prior to records and accounts available for inspection and review by the filing of, any Supplementary MaterialAgent;
(vk) until to incur, during the earlier Expenditure Period, Qualifying Expenditures in such amount as enables the Corporation to renounce to the Subscribers for Flow-Through Shares, Qualifying Expenditures in an amount equal to the Commitment Amount;
(l) to renounce to the Subscribers for Flow-Through Shares, pursuant to subsections 66(12.6) and 66(12.66) of the Qualification Date Act and effective on or before December 31, 2005, Qualifying Expenditures incurred during the Qualification DeadlineExpenditure Period in an amount equal to the Commitment Amount;
(m) to deliver to the Subscribers for Flow-Through Shares within the time period required by the Act and in any event, not later than March 31, 2006, a statement setting forth the aggregate amounts of such Qualifying Expenditures renounced to the Subscribers for Flow-Through Shares;
(n) that all Qualifying Expenditures renounced to the Subscribers for Flow-Through Shares pursuant to the Flow-Through Share Subscription Agreements will be Qualifying Expenditures incurred by the Corporation that, but for the renunciation to the Subscribers for Flow-Through Shares, the Corporation would be entitled to deduct in computing its income for the purposes of Part I of the Act;
(o) that the Corporation will not reduce the amount to be renounced to the Subscribers for Flow-Through Shares and, in the event the Minister of National Revenue reduces the amount renounced to the Subscribers for Flow-Through Shares pursuant to subsection 66(12.73) of the Act, the Corporation shall deliver indemnify the Subscribers for Flow-Through Shares as to, and pay in full settlement thereof to the Underwriters copies of all correspondence and other written communications between the Corporation and any Securities Regulators or other Governmental Authority relating Subscribers for Flow-Through Shares, an amount equal to the Offering amount of any tax payable under the Act (and under any corresponding provincial legislation) by the Acquisition and will generally keep the Underwriters apprised Subscribers for Flow-Through Shares as a consequence of the status of, including all developments relating to, the Offering, the Acquisition, and satisfaction of closing conditions for the Acquisition and the Release Conditionssuch reduction;
(wp) that if the Corporation does not renounce to the Subscribers for Flow-Through Shares Qualifying Expenditures equal to the Commitment Amount effective on or before December 31, 2005, the Corporation shall comply with indemnify the Subscribers for Flow-Through Shares as to, and satisfypay in full settlement thereof to the Subscribers for Flow-Through Shares, in all material respects, all terms, conditions an amount equal to the amount of any tax payable under the Act (and covenants in under any corresponding provincial legislation) by the Offer to PurchaseSubscribers for Flow-Through Shares as a consequence of such failure;
(xq) that the Corporation shall use will maintain its commercial best efforts to satisfy status as a Principal Business Corporation throughout the Release Conditions prior to the Release Deadline, including seeking any extensions or waivers necessary to keep the Offer to Purchase in full force and effect until the Qualification Deadline as necessaryExpenditure Period;
(yr) the Corporation shall use its commercial best efforts to enforce its rights against CryptoLogic and its affiliates file all prescribed forms required under the Offer Act with respect to Purchasethe issuance of the Flow-Through Shares as “flow-through shares” as defined in subsection 66(15) of the Act and that are necessary to renounce Qualifying Expenditures equal to the Commitment Amount to the Subscribers for Flow-Through Shares effective on or before December 31, 2005 and to provide the Subscribers for Flow-Through Shares with a copy of all such forms as are required to be provided thereto, all on a timely basis;
(zs) that the Corporation shall notify Canaccord Genuity in writing will not be subject to the provisions of subsection 66(12.67) of the receipt of all regulatory approvals required Act in a manner which impairs its ability to complete the Acquisition;
(aa) as a condition precedent renounce Qualifying Expenditures to the execution of the joint notice by Canaccord Genuity with the Corporation Subscribers for Flow-Through Shares in respect of the Release Event pursuant an amount equal to the Release Conditions, the Chief Executive Officer of the Corporation shall have delivered to Canaccord Genuity a certification that all conditions to the completion of the Acquisition by the Corporation, on terms previously disclosed to or otherwise reasonably acceptable to Canaccord Genuity, have been satisfied or waivedCommitment Amount; and
(bbt) that the Corporation will refrain from entering into transactions or taking deductions which would otherwise reduce its cumulative CEE to an extent it would preclude renunciation of Qualifying Expenditures in an amount equal to the Commitment Amount as contemplated herein and in the event that the Release Event does not occur on or before the Release Deadline, the Corporation shall forthwith deliver a notice to each of the Special Warrant holders and the Agent and the Agent shall return, within three Business Days, to each such holder the applicable subscription amount, plus any interest earned thereon, less applicable withholding taxes, if any, and the Special Warrants shall be cancelled. The Corporation shall be responsible Subscription Agreements for any shortfall in the aggregate subscription amount payable to Special Warrant holdersFlow-Through Shares.
Appears in 1 contract
Corporation’s Covenants. The Corporation hereby covenants to the Underwriters and to the Purchasers and their permitted assignsSo long as this Agreement is in force, and acknowledges that each except as otherwise permitted by the prior written consent of them is relying on such covenants in purchasing the Special WarrantsPurchaser, that the Corporation shallcovenants as follows:
(a) prior that it shall provide immediate notice to the Closing Time and at all times until a Final Receipt is issued, allow Purchaser in the Underwriters (and their counsel and consultants) to conduct all due diligence which the Underwriters may reasonably require or which may be considered necessary or appropriate by the Underwriters. The Corporation will provide to the Underwriters (and their counsel) reasonable access to the Corporation’s senior management personnel and corporate, financial and other records, for the purposes of conducting such due diligence. Without limiting the scope of the due diligence inquiry event that the Underwriters (or their counsel) may conduct, the Corporation shall also make available its directors, senior management, the Chairman of the Audit Committee of the Board of Directors, the auditors and counsel is no longer in good standing with any Governmental Authority for any reason which would reasonably be expected to answer any questions which the Underwriters may have and to participate in one or more due diligence sessions to be held prior to Closing and, prior to filing each of the Preliminary Prospectus and Final Prospectus and to use its commercial best efforts to arrange for the auditors of the Corporation to participate in any such due diligence sessiona Material Adverse Effect;
(b) duly execute mergers and acquisitions, sale of the Subscription Agreements which have been duly completed Facility, and asset sales (other than for the purpose of replacing equipment or otherwise in the ordinary course of business and in all other instances subject to permitted dispositions, as determined by the Purchasers subject to Purchaser acting reasonably), shall be permitted only with the terms thereofprior written consent of the Purchaser, and duly and punctually perform all the obligations such consent not to be performed by it under this Agreement and the Subscription Agreementsunreasonably withheld;
(c) use its commercial best efforts the Corporation agrees to fulfil or cause to be fulfilled, at or prior pay to the Closing Date, each of the conditions required to be fulfilled by it set out Purchaser in section 7 accordance with Section 2.2 hereof;
(d) use its commercial best efforts the Corporation shall consistently apply the same yield improvement initiatives to obtain the necessary approval product produced in the Facility as across the Corporation’s other grow operations. The Corporation shall further ensure that the appropriate yield improvement initiatives, as well as all other applicable growing techniques and growing capacity, are in place to maximize the Corporation’s production and that may positively influence growing capacity of Flower and Shake on the TSXV for the Offering and the listing of the Underlying Securities on such terms as are customaryFacility;
(e) file with the Canadian Securities Regulators and the TSXV all forms, notices and certificates required to be filed by the Corporation pursuant to shall consistently use the Canadian Securities Laws and the policies same pricing methods in respect of the TSXV product produced in the time required by the Canadian Securities Laws and the policies of the TSXV, including, for greater certainty, Form 45-106F1 of NI 45-106 and any other forms, notices and certificates set forth in the opinions delivered to the Underwriters pursuant to the closing conditions set forth in section 7 hereof, Facility as are required to be filed by across the Corporation’s other grow operations;
(f) ensure that the Underlying SharesCorporation shall not take any action, upon issuanceor fail to perform the necessary action, shall to impede, jeopardize or otherwise place any risk on their ability to renew or maintain any Material Licenses, Permits or approvals required to operate the Corporation’s Business which would reasonably be duly issued as fully paid and non-assessable Common Shares, and shall expected to have the attributes corresponding in all material respects to the description thereof set forth in this Agreement and the Subscription Agreementsa Material Adverse Effect;
(g) fulfil all legal requirements to permit Xx. Xxxxxx X. Hellard, or his nominee, shall be the creation, issuance, offering and sale Executive Chairman of the Special Warrants and the Underlying Securities, all as contemplated in Corporation while this Agreement and file or cause to be filed all documents, applications, forms or undertakings required to be filed by the Corporation and take or cause to be taken all action required to be taken by the Corporation is in connection with the purchase and sale of the Special Warrants and the issuance of the Qualified Securities, so that the distribution of the Qualified Securities may lawfully occur without the necessity of filing a registration statement in the United States or similar document in any other jurisdictioneffect;
(h) until the date Corporation shall pay or discharge, or cause to be paid or discharged, when the same become due and payable (i) all taxes imposed upon it or upon its income or profits or in respect of its Business or the Original Parcel and file all tax returns in respect thereof, (ii) all lawful claims for labour, materials and supplies in respect of the completion Original Parcel, (iii) all required payments under this Agreement, and (iv) all other obligations in respect of the distribution of Original Parcel; provided, however that it will not be required to pay or discharge or to cause to be paid or discharged any such amount so long as the Qualified Securities, use commercial best efforts validity or amount thereof is being contested in good faith by appropriate proceedings and an appropriate financial reserve satisfactory to ensure the Prospectus complies at all times with Canadian Securities LawsPurchaser has been established;
(i) during the period from Corporation shall use the date hereof until the date proceeds of the completion of Equity Sum only for the distribution of the Qualified Securities, promptly inform the Underwriters of the full particulars of any request of any Securities Regulator purposes specified in Section 2.3 hereof and not for any information, other purpose or the receipt by the Corporation of any communication from any Securities Regulator or for any other competent authority relating to the Corporation or which may be relevant to the distribution of the Qualified Securitiesperson;
(j) apply the net proceeds from Corporation shall comply and, to the Offering extent within its control, cause any other party that is acting under its authority to fund comply, in all material respects, with all Environmental Laws (including, but not limited to, obtaining any Permits) relating to the AcquisitionOriginal Parcel;
(k) comply with each of the covenants of the Corporation set out shall keep the Original Parcel in good working order and condition, normal wear and tear excepted, except to the extent that the failure to do so would not individually or in the Subscription Agreementsaggregate be reasonably likely to cause a Material Adverse Effect;
(l) advise the UnderwritersCorporation shall permit the Purchaser, promptly after receiving notice thereofand its agents, consultants, officers and employees, at the expense of the Corporation, provided such expenses are reasonably incurred, and upon reasonable prior notice during normal business hours, from time when to time to visit and inspect the Preliminary Prospectus, the Final Prospectus Original Parcel and any Supplementary Material have been filed to examine and receipts therefor have been obtained pursuant to NP 11-202 and will provide evidence reasonably satisfactory to the Underwriters of each such filing make abstracts from and copies of its physical and computer books of account and records as they pertain to the Original Parcel or the Corporation (including, without limitation, the Material Licences, and any plans and specifications, status of construction and project budgets with respect to the Original Parcel), (and where such receiptsinformation is not kept at the Original Parcel, but is in the possession or control of the Corporation at such other locations where such information is kept) as well as all data and computer data relating to the construction, managing, servicing, developing and marketing of the Original Parcel or the Corporation, which are in its possession and discuss its affairs, finances and accounts as they pertain to the Original Parcel, and be advised as to the same by the Corporation’s officers, consultants and legal counsel (with, prior to an Event of Default which is continuing, representatives of the Corporation present), all at such reasonable times as the Purchaser may desire;
(m) advise the UnderwritersCorporation shall permit the Purchaser, promptly and its agents, consultants, officers and employees, for the purposes of monitoring compliance with the covenants and obligations of the Corporation hereunder, at their risk, to visit and inspect the Original Parcel to conduct tests, measurements and surveys in relation to the Original Parcel provided that such tests, measurements and surveys are conducted in accordance with prudent industry practice and Applicable Law and/or are required as a result of the reasonable concerns of the Purchaser as to noncompliance with such covenant and obligation, and to be advised as to the same by the officers, engineers and advisers of the Corporation (or such other persons as may be appropriate), all at such reasonable times and intervals as the Purchaser may desire upon reasonable prior notice and in the presence of the Corporation, if so desired. Such visits, inspections, measurements, reviews and tests etc. shall be at the cost of the Corporation, provided such expenses are reasonably incurred. Any such visit, inspection, examination, discussion or tests shall not be deemed to be supervision, charge, management, control or occupation by the Purchaser for purposes of any environmental or other liabilities;
(n) the Corporation shall maintain, or cause to be maintained adequate books, accounts and records: (i) in relation to the Original Parcel; and (ii) in accordance with GAAP consistently applied;
(o) the Corporation agrees that certified copies of each policy of insurance shall be delivered to the Purchaser [***] after receiving notice or obtaining knowledge thereofthe placing of the required insurance; and that at least [***] days prior to the expiry of any such policy of insurance a certified copy of the policy of insurance intended to replace such expiring policy will be furnished to the Purchaser, ofand:
(i) if the issuance by any Canadian Securities Regulator of any order suspending Corporation shall fail to take out or preventing the use of the Prospectus or any Supplementary Material;
(ii) the institution, threatening or contemplation of any proceeding for keep in force any such purposes;
(iii) any order, ruling, or determination having the effect of suspending the sale or ceasing the trading in any securities of the Corporation (including the Special Warrants or the Underlying Securities) having been issued by any Canadian Securities Regulator or the institution, threatening or contemplation of any proceeding for any such purposes; or
(iv) any requests made by any Canadian Securities Regulators to amend or supplement the Prospectus or to provide additional information, and will use its commercial best efforts to prevent the issuance of any order insurance referred to in (i) above andSection 6.1(d), if or should any such order is issuedinsurance not be approved by the Purchaser and should the Corporation not proceed to diligently rectify the situation [***] after written notice by the Purchaser to the Corporation, or if the Corporation shall fail to deliver to the Purchaser certified copies of such insurance policies (or renewal policies) in the manner described above, then the Purchaser shall have the right, without assuming any obligation in connection therewith, to obtain effect such insurance at the withdrawal thereof as quickly as possible;
(n) except to the extent the Corporation participates in a merger or business combination transaction which is in the best interest sole cost of the Corporation and following which all costs and expenses incurred by the Purchaser in so doing shall be payable forthwith by the Corporation is not a “reporting issuer”, use its commercial best efforts to maintain its status as a “reporting issuer” (or the equivalent thereof) not in default of the requirements of Canadian Securities Laws of each of the Canadian jurisdictions in which it is currently a reporting issuer, which have such a concept to the date which is two years following Purchaser, with interest thereon at the Closing Date; and
(o) except to rate of [***]% per annum and shall be a charge upon the extent the Corporation participates in a merger or business combination transaction which is in the best interest of the Corporation and following which the Corporation is not listed on the TSXV or the TSX, use its commercial best efforts to maintain the listing of:
(i) the Common Shares on the TSXV or the TSX or such other recognized stock exchange or quotation system as Canaccord Genuity, on behalf of the Underwriters, may approve, acting reasonably, to the date that is two years following the Closing DateOriginal Parcel; and
(ii) nothing herein shall be deemed to hold the Convertible Debentures and the Warrants on the TSXV Purchaser responsible for failure to have insurance placed or the TSX for any loss growing out of any defects in any policy, or such other recognized stock exchange because of failure of an insurance company to pay for any loss or quotation system as Canaccord Genuity, on behalf of the Underwriters, may approve, acting reasonably, until the Maturity Date or Expiry Date, as applicable. The Corporation further hereby covenants to the Underwriters and to the Purchasers and their permitted assigns, and acknowledges that each of them is relying on such covenants in purchasing the Special Warrants, that following the Closing:damage insured against;
(p) the Corporation shall qualify give written notice to the distribution Purchaser promptly after becoming aware, using reasonable diligence, thereof of:
(i) any litigation, dispute, arbitration or other proceeding to which a Corporation is a party, the result of which if determined adversely in the case of the Qualified Securities Corporation would be a judgement or award in excess of Fifty Thousand ($50,000.00) Dollars, or that in the Qualifying Provinces to holders case of the Special Warrants Corporation could result in a Material Adverse Effect, and file from time to time provide the Preliminary Prospectus Purchaser with all reasonable information requested by the Purchaser concerning the status of any such proceeding;
(ii) any Event of Default, together with an Officer’s Certificate specifying such Event of Default and detailing the steps being taken, if any, to cure same;
(iii) the incurrence or existence of any Encumbrance (other than a Permitted Encumbrance) on any collateral after Closing; or
(iv) the occurrence of an event of Force Majeure, describing in each reasonable detail the effects of such event on the construction or operation of the Qualifying Provinces Original Parcel, as soon as possible following the Closing Date case may be, the action which the Corporation intends to take to remedy such event and the Final Prospectus promptly following receipt estimated date when the event of Force Majeure will be remedied and settlement will cease to impair construction or operation of comments from the Canadian Securities RegulatorsOriginal Parcel, as the case may be;
(q) the Corporation shall use its commercial best efforts to: satisfy all comments from and after the occurrence of an Event of Default and for so long as it is subsisting, allow the Purchaser, subject to Permitted Encumbrances, to lawfully, peaceably and quietly enter into, have, hold, use, occupy, possess and enjoy the Original Parcel with respect to the Preliminary Prospectus; prepare and file the Final Prospectus under Canadian Securities Laws; obtain the Final Receipt (in accordance with the procedures of prospectus review in multiple jurisdictions provided for under NP 11-202)their appurtenances without suit, and take all hindrance, interruption or denial by it, or any other steps and proceedings that may be necessary to be taken by the Corporation in order to qualify the Qualified Securities for distribution in each of the Qualifying Provinces under Canadian Securities Laws, as soon as practicable following the Closing Date and, in any event, prior to the Qualification Deadlineperson whomsoever;
(r) the Corporation shall allow provide written notice to the Underwriters to participate in the preparation of the Prospectus and any Supplementary Material that Purchaser not less than 120 days before the Corporation is required makes any voluntary assignment into bankruptcy, makes a proposal to file its creditors or files notice of its intention to do so, institutes any other proceeding under Canadian Securities Laws relating Applicable Law seeking to the Offeringadjudicate it a bankrupt or an insolvent, or any other similar relief;
(s) the Corporation shall promptly upon having knowledge thereof, cure or cause to be cured any defects in the execution and delivery of the Final Prospectus and any Supplementary Material to the Underwriters by the Corporation in accordance with this Agreement will constitute the representation and warranty of the Corporation to the Underwriters that (except for information and statements relating solely to the Underwriters and furnished by them specifically for use in the Final Prospectus), at the respective times of delivery:
(i) the information and statements contained in each of the Final Prospectus and any Supplementary Material:
(A) are true and correct and contain no misrepresentation; and
(B) constitute full, true and plain disclosure of all material facts relating to the Qualified Securities and the Corporation considered as a whole;
(ii) no material fact has been omitted from any of the Final Prospectus Royalty Documents or any of the other agreements, instruments or documents contemplated hereby and thereby or executed pursuant hereto and thereto or any Supplementary Material that is required defects in the validity or enforceability of any of the Royalty Documents and execute and deliver or cause to be stated in executed and delivered all such agreements, instruments and other documents as the document Purchaser may consider reasonably necessary or is necessary to make desirable for the statements therein not misleading in the light of the circumstances in which they were made; and
(iii) the Final Prospectus and the Supplementary Material comply in all material respects with Canadian Securities Lawsforegoing purposes;
(t) prior to any advance made hereunder, the Corporation will deliver to shall provide the Underwriters, without charge, contemporaneously with, or prior to the filing of, the Final Prospectus, unless otherwise indicated:
(i) a copy of any document filed with, or delivered to, the Canadian Securities Regulators by the Corporation under Canadian Securities Laws Purchaser with the Final Prospectus;
(ii) a certificate dated the date of the Final Prospectus, addressed to the Underwriters and signed by the Chief Executive Officer and Chief Financial from an Officer of the Corporation, Corporation certifying for and on behalf of that the Corporation, and not in their personal capacities, after having made due inquiries, with respect to the following matters:
(A) the Corporation having complied with all of the covenants and satisfied all of the terms and conditions of this Agreement on its part to be complied with and satisfied at or prior to the date of the Final Prospectus;
(B) no order, ruling or determination having the effect of ceasing or suspending trading in any securities of the Corporation or prohibiting the issue of the Special Warrants or the Underlying Securities or any contents of the Corporation’s issued securities having been issued and no proceeding for such purpose being pending or, to the knowledge of such officers, threatened;
(C) the representations and warranties of the Corporation contained in this Agreement and in any certificates of Corporation delivered pursuant to or in connection with this Agreement being Officer’s Certificate remain true and correct as at the date time of the Final Prospectus, with the same force and effect as if made on and as at the date of the Final Prospectus, after giving effect to the transactions contemplated by this Agreement; and
(D) since the Closing Time, there having been no material adverse change, financial or otherwise, in the assets, liabilities (contingent or otherwise), capital, business or results of operations of the Corporationsuch advance;
(u) the Corporation shall deliver opinionsissue 4,500,000 Shares at Closing to be valued at $2.44 per Share in the aggregate, comfort letters of which:
(i) Xx. Xxxxxx X. Hellard acknowledges receipt of 1,000,000 Shares valued at $3.00 per Share in the aggregate; and
(ii) 3,500,000 Shares are to be issued to Xx. Xxxxxx X. Hellard on Closing and other documents substantially similar held in escrow by the Corporation’s counsel, pending receipt of additional advances of the Equity Sum made after January 15, 2018 in accordance with the following sentence. Upon receipt of any additional advance by the Corporation, Xx. Xxxxxx X. Hellard shall receive Shares having a corresponding value to those referred to in this section 1 to Canaccord Genuity the amount of such additional advance and such Shares shall be released from escrow at $2.29 per Share and the Underwriters’ counsel, Corporation shall provide and Xx. Xxxxxx X. Hellard shall complete a share subscription for such Shares; provided that if on the date that is 2 years after Closing any Shares have not been released from escrow as applicable, with respect to any Supplementary Material, contemporaneously with, or prior a result of the Equity Sum not having been advanced to the filing ofCorporation in full, any Supplementary Materialsuch Shares shall immediately be returned to the Corporation and cancelled;
(v) until the earlier Corporation, for so long as this Agreement is in effect, shall establish and maintain procedures that all cheques: (i) less than or equal to $[***] will require the approval of the Qualification Date President or the Chief Executive Officer and to be signed by same; (ii) greater than $[***] and less than or equal to $[***] in respect of operating expenses will require the approval of the President or the Chief Executive Officer and to be signed by same and one (1) executive member; (iii) greater than $[***] but less than or equal to $[***] will require the approval of the Executive Chairman and the Qualification Deadline, President or Chief Executive Officer and to be signed by same and one (1) executive member; (iv) greater than $[***] and less than or equal to $[***] in respect of construction expenses will require the Corporation shall deliver to the Underwriters copies of all correspondence and other written communications between the Corporation and any Securities Regulators or other Governmental Authority relating to the Offering and the Acquisition and will generally keep the Underwriters apprised approval of the status of, including all developments relating to, Executive Chairman and to be signed by same and one (1) executive member; and (v) in excess of $[***] will require the Offering, approval of the Acquisition, Board of Directors and satisfaction of closing conditions for the Acquisition and the Release Conditions;to be signed by two (2) executive members; and
(w) the Corporation shall comply with and satisfy, in all material respects, all terms, conditions undertakes and covenants in that at least [***] square feet of space within the Offer to Purchase;
(x) the Corporation shall use its commercial best efforts to satisfy the Release Conditions prior to the Release Deadline, including seeking any extensions or waivers necessary to keep the Offer to Purchase in full force and effect until the Qualification Deadline as necessary;
(y) the Corporation shall use its commercial best efforts to enforce its rights against CryptoLogic and its affiliates under the Offer to Purchase;
(z) the Corporation shall notify Canaccord Genuity in writing of the receipt of all regulatory approvals required to complete the Acquisition;
(aa) as a condition precedent to the execution of the joint notice by Canaccord Genuity with the Corporation in respect of the Release Event pursuant to the Release Conditions, the Chief Executive Officer of the Corporation shall have delivered to Canaccord Genuity a certification that all conditions to the completion of the Acquisition by the Corporation, on terms previously disclosed to or otherwise reasonably acceptable to Canaccord Genuity, have been satisfied or waived; and
(bb) in the event that the Release Event does not occur on or before the Release Deadline, the Corporation shall forthwith deliver a notice to each of the Special Warrant holders and the Agent and the Agent shall return, within three Business Days, to each such holder the applicable subscription amount, plus any interest earned thereon, less applicable withholding taxes, if any, and the Special Warrants Facility shall be cancelled. The Corporation shall be responsible for any shortfall in the aggregate subscription amount payable used exclusively to Special Warrant holdersgrow Flower.
Appears in 1 contract
Samples: Investment and Royalty Agreement (Sundial Growers Inc.)
Corporation’s Covenants. The Corporation hereby covenants to the Underwriters Agent and to the Purchasers and their permitted assigns, and acknowledges that each of them is relying on such covenants in purchasing the Special Warrants, that the Corporation shallUnits:
(a) prior to unless otherwise inconsistent with the fiduciary duties of the board of directors of the Corporation, for a period of 18 months after the Closing Time and at all times until Date it will use commercially reasonable efforts to maintain its status as a Final Receipt is issued, allow the Underwriters (and their counsel and consultants) to conduct all due diligence which the Underwriters may reasonably require or which may be considered necessary or appropriate by the Underwriters. The Corporation will provide to the Underwriters (and their counsel) reasonable access to the Corporation’s senior management personnel and corporate, financial and other records, for the purposes of conducting such due diligence. Without limiting the scope “reporting issuer” under Securities Laws of the due diligence inquiry that the Underwriters (or their counsel) may conductprovinces of British Columbia, the Corporation shall also make available its directorsAlberta, senior managementSaskatchewan, the Chairman New Brunswick and Ontario not in default of the Audit Committee any requirement of the Board of Directors, the auditors and counsel to answer any questions which the Underwriters may have and to participate in one or more due diligence sessions to be held prior to Closing and, prior to filing each of the Preliminary Prospectus and Final Prospectus and to use its commercial best efforts to arrange for the auditors of the Corporation to participate in any such due diligence sessionSecurities Laws;
(b) the Unit Shares and the Warrants (including those Unit Shares and Warrants underlying the Over-Allotment Units, if applicable) will be duly execute and validly created, authorized and issued on the Subscription Agreements which have been duly completed by the Purchasers subject to the terms thereofpayment therefor, and duly such Unit Shares and punctually perform all Warrants (including those Unit Shares and Warrants underlying the obligations to be performed by it under this Agreement Over-Allotment Units, if applicable) will have the attributes set out in the U.S. Preliminary Prospectus, the U.S. Prospectus, the Registration Statement, and the Subscription Agreementsany Amendment, as applicable;
(c) as promptly as practicable following the Closing Date and the receipt by the Corporation of Selling Securityholder Forms, it will prepare and file the U.S. Preliminary Prospectus under the U.S. Securities Act in the United States;
(d) as soon as possible after any comments of the SEC have been satisfied, it will have caused the Registration Statement to be declared effective by the SEC and will prepare and file with the SEC, the U.S. Prospectus pursuant to Rule 424(b) under the U.S. Securities Act in the United States; and shall further ensure that no stop order suspending the effectiveness of the U.S. Prospectus, the Registration Statement or any post-effective amendment thereto or any Rule 462(b) Registration Statement, if any, is issued and no proceeding for that purpose is initiated or threatened by the SEC; the various parts of the Initial Registration Statement and the Rule 462(b) Registration Statement, if any, including all exhibits thereto and including the information contained in the form of final prospectus filed with the SEC pursuant to Rule 424(b) under the U.S. Securities Act in accordance with Section 5(a) hereof and deemed by virtue of Rule 430A under the U.S. Securities Act to be part of the Initial Registration Statement at the time it is declared effective, each as amended at the time such part of the Initial Registration Statement becomes effective or such part of the Rule 462(b) Registration Statement, if any, becomes effective, are hereinafter collectively called the “Registration Statement”; and such final prospectus, in the form first filed pursuant to Rule 424(b) under the U.S. Securities Act, is hereinafter called the “U.S. Prospectus”;
(e) The Corporation agrees to use commercially reasonable efforts, including instructing its counsel to deliver requested legal opinions, following the effectiveness of the Registration Statement to instruct the Transfer Agent for the Common Shares, Warrant Shares, Warrants, Broker Warrants and Broker Shares covered by the Registration Statement to remove any restrictive legends included on such Common Shares, Warrant Shares, Warrants, Broker Warrants or Broker Shares in connection with the initial sale or transfer thereof by the selling securityholders listed in the Registration Statement, and any costs related to the removal of the restrictive legends shall be borne by the Corporation (up to a maximum of $150 per legend removal request per securityholder);
(f) it shall fulfill to the satisfaction of the Agent all legal requirements to be fulfilled by it to enable the Unit Shares and the Warrants (including those Unit Shares and Warrants underlying the Over-Allotment Units, if applicable) to be offered for sale and sold in the Qualifying Jurisdictions by or through the Selling Firms who comply with all applicable Securities Laws in each of the Selling Jurisdictions;
(g) each of the Unit Shares, Warrants and Warrant Shares, including those issued pursuant to the Over-Allotment Option, and the Broker Warrants and the Broker Shares, upon effectiveness of the Registration Statement, will not carry any United States resale or transfer restrictions under applicable United States Securities Laws;
(h) it shall allow and assist the Agent to participate fully in the preparation of the U.S. Preliminary Prospectus, the U.S. Prospectus, the Registration Statement and any Amendment, as applicable, and shall allow the Agent to conduct all “due diligence” investigations which the Agent may reasonably require to fulfill the Agent’s obligations as Agent and to enable the Agent responsibly to execute any certificate required to be executed by the Agent and it shall comply with all requests for additional information on the part of the SEC or any Canadian Securities Commission to the reasonable satisfaction of the Agent;
(i) it will comply with the Securities Laws in each of the Qualifying Jurisdictions it will promptly inform the Agent in writing of the full particulars of any material change, actual, anticipated or threatened, in the operating or financial condition of the Corporation or of any change in any material fact contained or referred to in the U.S. Preliminary Prospectus, the U.S. Prospectus, the Registration Statement or any Amendment or Supplementary Material thereto, as applicable, and of the existence of any material fact which is, or may be, of such a nature as to render the U.S. Preliminary Prospectus, the U.S. Prospectus, the Registration Statement or any Amendment or Supplementary Material thereto, as applicable, untrue, false or misleading in a material respect or result in a misrepresentation. The Corporation shall, to the satisfaction of the Agent and its counsel, acting reasonably, promptly comply with all applicable filings and other requirements under the Securities Laws as a result of such change. The Corporation shall, in good faith, first discuss with the Agent any change in circumstances (actual or proposed, within the Corporation’s knowledge) which is of such a nature that there is reasonable doubt whether notice need be given to the Agent pursuant to this Section 2(i) and, in any event, prior to making any filing referred to in this Section 2(i). For greater certainty, it is understood and agreed that if the Agent determines, after consultation with the Corporation, that a material change or change in a material fact has occurred which makes untrue or misleading any statement of a material fact contained in the U.S. Preliminary Prospectus, the U.S. Prospectus, the Registration Statement or any Amendment or Supplementary Material thereto, or which may result in a misrepresentation, the Corporation will: i. prepare and file promptly any Amendment which in its opinion, acting reasonably, may be necessary or advisable after consultation with the Agent; and ii. contemporaneously with filing the Amendment under the Securities Laws, the Corporation will deliver to the Agent:
(A) an originally signed copy of the Amendment;
(B) an originally signed copy of all documents relating to the proposed distribution of the Units and filed with the Amendment under Securities Laws; and
(C) such other documents as the Agent shall reasonably require;
(j) it will advise the Agent, promptly after receiving notice thereof, of the time when the U.S. Preliminary Prospectus, the U.S. Prospectus, the Registration Statement and any Amendment or Supplementary Material has been filed and receipts have been obtained and will provide evidence satisfactory to the Agent of each filing and the issuance of receipts;
(k) it will advise the Agent, promptly after receiving notice or obtaining knowledge, of: i. the issuance by any Securities Commission of any order suspending or preventing the use of the U.S. Preliminary Prospectus, the U.S. Prospectus, theRegistration Statement or any Supplementary Material; ii. the suspension of the qualification of the Units, or, if applicable, the Over- Allotment Units for offering or sale in any of the Selling Jurisdictions; iii. the institution, threatening or contemplation of any proceeding for any of those purposes; or iv. any requests made by any Securities Commission for amending or supplementing the U.S. Preliminary Prospectus, the U.S. Prospectus or the Registration Statement or for additional information, and will use its commercial best commercially reasonable efforts to prevent the issuance of any such order and,if any such order is issued, to obtain the withdrawal of the order promptly;
(l) it will use commercially reasonable efforts to promptly do, make, execute, deliver or cause to be done, made, executed or delivered, all such acts, documents and things as the Agent may reasonably require from time to time for the purpose of giving effect to this Agreement, the Subscription Agreements and the transactions contemplated by the U.S. Preliminary Prospectus, the U.S. Prospectus and the Registration Statement and take all such steps as may be reasonably within their power to implement to their full extent the provisions of this Agreement, the Subscription Agreements and the transactions contemplated by the U.S. Preliminary Prospectus, the U.S. Prospectus and the Registration Statement;
(m) it is not an “ineligible issuer” as defined under Rule 405 under the U.S. Securities Act;
(n) it does not have any outstanding debt securities that are rated by any “nationally recognized statistical rating organization”, as that term is defined by the SEC for purposes of Rule 436(g)(2) under the Act or by the DBRS rating agency in Canada;
(o) it will ensure that a sufficient number of Common Shares are allotted and reserved for issuance upon the exercise of the Warrants, and the Broker Warrants;
(p) it will ensure that the Warrants are duly and validly created, authorized and issued on payment of the exercise price therefor and shall have attributes corresponding in all material respects to the description set forth in this Agreement;
(q) it will ensure that the Broker Warrants are duly and validly created, authorized and issued on payment of the exercise price therefor and shall have attributes corresponding in all material respects to the description set forth in this Agreement;
(r) it will ensure that the Warrant Shares issuable upon the exercise of the Warrants and the Broker Shares issuable upon the exercise of the Broker Warrants shall, upon issuance in accordance with their terms or the terms of the Warrant Indenture, as applicable, without limitation, including payment of the exercise price therefor, be duly issued as fully paid and non-assessable shares of the Corporation;
(s) it will make all necessary filings, obtain all necessary regulatory consents and approvals (if any) and the Corporation will pay all filing fees required to be paid in connection with the transactions contemplated in this Agreement;
(t) subject to compliance with applicable laws, any press release of the Corporation relating to the Offering will be provided in advance to the Agent and the Corporation will agree to the form and substance thereof with the Agent prior to the release thereof;
(u) it shall use commercially reasonable efforts to maintain the Registration Statement or post-effective amendment thereto effective under the U.S. Securities Act until the earlier of: (i) the date that all of the Unit Shares, Warrants and Warrant Shares registered pursuant to the Registration Statement have been sold pursuant to such Registration Statement or Rule 144 under the U.S. Securities Act , if available, or (ii) the date that is 48 months from the Closing Date;
(v) it will file promptly all reports and any definitive proxy or information statements required to be filed by the Corporation with the SEC pursuant to Section 13(a), 13(c), 14 or 15(d) of the U.S. Exchange Act subsequent to the date of the U.S. Prospectus and for so long as the delivery of the U.S. Prospectus is required in connection with the offering or sale of the Units and Over-Allotment Units or the terms of this Agreement;
(w) it will not for a period commencing the date that this Agreement is signed and for two years thereafter to remain a reporting issuer under Canadian Securities Laws in the Canadian Qualifying Jurisdictions, not in default of any requirement of such Canadian Securities Laws, provided that this covenant shall not prevent the Corporation from completing any transaction which would result in the Corporation ceasing to be a “reporting issuer” so long as the holders of Common Shares receive securities of an entity which is listed on a stock exchange in Canada or cash or the holders of the Common Shares have approved the transaction in accordance with the requirements of applicable corporate laws and the policies of the TSX;
(x) it will not take any action for a period commencing on the Closing Date and for two years thereafter which would reasonably be expected to result in the delisting or suspension of its Common Shares on or from the TSX or on or from any securities exchange, market or trading or quotation facility on which its Common Shares are then listed or quoted, provided that this covenant shall not prevent the Corporation from completing any transaction which would result in the Corporation ceasing to be listed on the TSX so long as the holders of Common Shares receive securities of an entity which is listed on a stock exchange in Canada or cash or the holders of the Common Shares have approved the transaction in accordance with the requirements of applicable corporate laws and the policies of the TSX;
(y) it will not, and will use its commercially reasonable efforts to ensure that each of the Corporation or the Subsidiaries or any of their respective officers, directors or employees, as the case may be, do not, bid for or purchase, for their own account or any account in which they have a beneficial interest, any Common Shares or any securities exchangeable or exercisable for or convertible into Common Shares after the date hereof until the Closing Date without the written consent of the Agent;
(z) it has not engaged in, nor will it engage in, any directed selling efforts (as defined in Regulation S) in connection with the offer and sale of the Units;
(aa) no forward looking statement (within the meaning of Section 27A of the U.S. Securities Act) included or incorporated by reference in the Registration Statement, the U.S. Preliminary Prospectus or the U.S. Prospectus, has been made or reaffirmed without a reasonable basis or has been disclosed other than in good faith;
(bb) it will duly execute and deliver the Subscription Agreements and the certificates representing the Warrants and the Broker Warrants, at the Closing Time, and comply with and satisfy all terms, conditions and covenants therein contained to be complied with or satisfied;
(cc) it will use commercially reasonable efforts to fulfil or cause to be fulfilled, at or prior to the Closing DateTime, each of the conditions required to be fulfilled by it set out in section 7 hereofunder Section 8;
(ddd) it will use its commercial best efforts to obtain the necessary approval of the TSXV for the Offering and the listing of the Underlying Securities on such terms as are customary;
(e) file with the Canadian Securities Regulators and the TSXV all forms, notices and certificates required to be filed by the Corporation pursuant to the Canadian Securities Laws and the policies of the TSXV in the time required by the Canadian Securities Laws and the policies of the TSXV, including, for greater certainty, Form 45-106F1 of NI 45-106 and any other forms, notices and certificates set forth in the opinions delivered to the Underwriters pursuant to the closing conditions set forth in section 7 hereof, as are required to be filed by the Corporation;
(f) ensure that the Underlying Shares, upon issuance, shall be duly issued as fully paid and non-assessable Common Shares, and shall have the attributes corresponding in all material respects to the description thereof set forth in this Agreement and the Subscription Agreements;
(g) fulfil all legal requirements to permit the creation, issuance, offering and sale of the Special Warrants and the Underlying Securities, all as contemplated in this Agreement and file or cause to be filed all documents, applications, forms or undertakings required to be filed by the Corporation and take or cause to be taken all action required to be taken by the Corporation in connection with the purchase and sale of the Special Warrants and the issuance of the Qualified Securities, so that the distribution of the Qualified Securities may lawfully occur without the necessity of filing a registration statement in the United States or similar document in any other jurisdiction;
(h) until the date of the completion of the distribution of the Qualified Securities, use commercial best efforts to ensure the Prospectus complies at all times with Canadian Securities Laws;
(i) during the period from the date hereof until the date of the completion of the distribution of the Qualified Securities, promptly inform the Underwriters of the full particulars of any request of any Securities Regulator for any information, or the receipt by the Corporation of any communication from any Securities Regulator or any other competent authority relating to the Corporation or which may be relevant to the distribution of the Qualified Securities;
(j) apply the net proceeds from of the Offering to fund the Acquisition;
(k) comply with each of the covenants of the Corporation set out in the Subscription Agreements;
(l) advise the Underwriters, promptly after receiving notice thereof, of the time when the Preliminary Prospectus, the Final Prospectus for working capital and any Supplementary Material have been filed and receipts therefor have been obtained pursuant to NP 11-202 and will provide evidence reasonably satisfactory to the Underwriters of each such filing and copies of such receipts;
(m) advise the Underwriters, promptly after receiving notice or obtaining knowledge thereof, of:
(i) the issuance by any Canadian Securities Regulator of any order suspending or preventing the use of the Prospectus or any Supplementary Material;
(ii) the institution, threatening or contemplation of any proceeding for any such general corporate purposes;
(iiiee) any orderit will ensure that all necessary notices and filings will have been made before the Closing Time and that all necessary consents, ruling, or determination having the effect of suspending the sale or ceasing the trading in any securities of approvals and authorizations will have been obtained by the Corporation (including from the Special Warrants or TSX to ensure that the Underlying Securities) having been issued by any Canadian Securities Regulator or Unit Shares, Warrant Shares and Broker Shares will be listed on the institution, threatening or contemplation TSX upon and at the time of any proceeding for any such purposes; or
(iv) any requests made by any Canadian Securities Regulators to amend or supplement the Prospectus or to provide additional information, and will use its commercial best efforts to prevent the issuance of any order referred to in (i) above and, if any such order is issued, to obtain the withdrawal thereof as quickly as possible;
(n) except to the extent the Corporation participates in a merger or business combination transaction which is in the best interest of the Corporation and following which the Corporation is not a “reporting issuer”, use its commercial best efforts to maintain its status as a “reporting issuer” (or the equivalent thereof) not in default of the requirements of Canadian Securities Laws of each of the Canadian jurisdictions in which it is currently a reporting issuer, which have such a concept to the date which is two years following the Closing Datetheir issuance; and
(off) except to the extent the Corporation participates in a merger or business combination transaction which is in the best interest of the Corporation it will ensure that all information (including, without limitation, financial information) and following which the Corporation is not listed on the TSXV or the TSX, use its commercial best efforts to maintain the listing of:
(i) the Common Shares on the TSXV or the TSX or such other recognized stock exchange or quotation system as Canaccord Genuity, on behalf of the Underwriters, may approve, acting reasonably, to the date that is two years following the Closing Date; and
(ii) the Convertible Debentures and the Warrants on the TSXV or the TSX or such other recognized stock exchange or quotation system as Canaccord Genuity, on behalf of the Underwriters, may approve, acting reasonably, until the Maturity Date or Expiry Date, as applicable. The Corporation further hereby covenants to the Underwriters and to the Purchasers and their permitted assigns, and acknowledges that each of them is relying on such covenants in purchasing the Special Warrants, that following the Closing:
(p) the Corporation shall qualify the distribution of the Qualified Securities in the Qualifying Provinces to holders of the Special Warrants and file the Preliminary Prospectus in each of the Qualifying Provinces as soon as possible following the Closing Date and the Final Prospectus promptly following receipt and settlement of comments from the Canadian Securities Regulators;
(q) the Corporation shall use its commercial best efforts to: satisfy all comments with respect to the Preliminary Prospectus; prepare and file the Final Prospectus under Canadian Securities Laws; obtain the Final Receipt (in accordance with the procedures of prospectus review in multiple jurisdictions provided for under NP 11-202), and take all other steps and proceedings that may be necessary to be taken by the Corporation in order to qualify the Qualified Securities for distribution in each of the Qualifying Provinces under Canadian Securities Laws, as soon as practicable following the Closing Date and, in any event, prior to the Qualification Deadline;
(r) the Corporation shall allow the Underwriters to participate in the preparation of the Prospectus and any Supplementary Material that the Corporation is required to file under Canadian Securities Laws relating to the Offering;
(s) the delivery of the Final Prospectus and any Supplementary Material to the Underwriters by the Corporation in accordance with this Agreement will constitute the representation and warranty of the Corporation to the Underwriters that statements (except for information and statements relating solely to the Underwriters Agent) relating to the Corporation provided to the Agent and furnished by them specifically for use in the Final Prospectus), at the respective times of delivery:
(i) the information and statements contained in each of the Final Prospectus and any Supplementary Material:
(A) are Purchasers will be true and correct in all material respects at the time of delivery thereof and will not contain no misrepresentation; and
(B) any misrepresentation and will constitute full, true and plain disclosure of all material facts relating to the Qualified Securities Corporation, and the Corporation considered as a whole;
(ii) that no material fact has been or information will be omitted from any of the Final Prospectus and any Supplementary Material that therefrom which is required to be stated in the document therein or is necessary to make the statements or information contained therein not misleading in the light of the circumstances in under which they were made; and
(iii) the Final Prospectus and the Supplementary Material comply in all material respects with Canadian Securities Laws;
(t) the Corporation will deliver to the Underwriters, without charge, contemporaneously with, or prior to the filing of, the Final Prospectus, unless otherwise indicated:
(i) a copy of any document filed with, or delivered to, the Canadian Securities Regulators by the Corporation under Canadian Securities Laws with the Final Prospectus;
(ii) a certificate dated the date of the Final Prospectus, addressed to the Underwriters and signed by the Chief Executive Officer and Chief Financial Officer of the Corporation, certifying for and on behalf of the Corporation, and not in their personal capacities, after having made due inquiries, with respect to the following matters:
(A) the Corporation having complied with all of the covenants and satisfied all of the terms and conditions of this Agreement on its part to be complied with and satisfied at or prior to the date of the Final Prospectus;
(B) no order, ruling or determination having the effect of ceasing or suspending trading in any securities of the Corporation or prohibiting the issue of the Special Warrants or the Underlying Securities or any of the Corporation’s issued securities having been issued and no proceeding for such purpose being pending or, to the knowledge of such officers, threatened;
(C) the representations and warranties of the Corporation contained in this Agreement and in any certificates of Corporation delivered pursuant to or in connection with this Agreement being true and correct as at the date of the Final Prospectus, with the same force and effect as if made on and as at the date of the Final Prospectus, after giving effect to the transactions contemplated by this Agreement; and
(D) since the Closing Time, there having been no material adverse change, financial or otherwise, in the assets, liabilities (contingent or otherwise), capital, business or results of operations of the Corporation;
(u) the Corporation shall deliver opinions, comfort letters and other documents substantially similar to those referred to in this section 1 to Canaccord Genuity and the Underwriters’ counsel, as applicable, with respect to any Supplementary Material, contemporaneously with, or prior to the filing of, any Supplementary Material;
(v) until the earlier of the Qualification Date and the Qualification Deadline, the Corporation shall deliver to the Underwriters copies of all correspondence and other written communications between the Corporation and any Securities Regulators or other Governmental Authority relating to the Offering and the Acquisition and will generally keep the Underwriters apprised of the status of, including all developments relating to, the Offering, the Acquisition, and satisfaction of closing conditions for the Acquisition and the Release Conditions;
(w) the Corporation shall comply with and satisfy, in all material respects, all terms, conditions and covenants in the Offer to Purchase;
(x) the Corporation shall use its commercial best efforts to satisfy the Release Conditions prior to the Release Deadline, including seeking any extensions or waivers necessary to keep the Offer to Purchase in full force and effect until the Qualification Deadline as necessary;
(y) the Corporation shall use its commercial best efforts to enforce its rights against CryptoLogic and its affiliates under the Offer to Purchase;
(z) the Corporation shall notify Canaccord Genuity in writing of the receipt of all regulatory approvals required to complete the Acquisition;
(aa) as a condition precedent to the execution of the joint notice by Canaccord Genuity with the Corporation in respect of the Release Event pursuant to the Release Conditions, the Chief Executive Officer of the Corporation shall have delivered to Canaccord Genuity a certification that all conditions to the completion of the Acquisition by the Corporation, on terms previously disclosed to or otherwise reasonably acceptable to Canaccord Genuity, have been satisfied or waived; and
(bb) in the event that the Release Event does not occur on or before the Release Deadline, the Corporation shall forthwith deliver a notice to each of the Special Warrant holders and the Agent and the Agent shall return, within three Business Days, to each such holder the applicable subscription amount, plus any interest earned thereon, less applicable withholding taxes, if any, and the Special Warrants shall be cancelled. The Corporation shall be responsible for any shortfall in the aggregate subscription amount payable to Special Warrant holders.
Appears in 1 contract
Samples: Agency Agreement
