SUBSCRITION AGREEMENT OBAN MINING, INC. COMMON SHARES
EXHIBIT 10.5 Mandalay Investment Agreement
SUBSCRITION AGREEMENT
OBAN MINING, INC.
COMMON SHARES
The undersigned purchaser ("Purchaser") hereby irrevocably subscribes for and agrees to purchase the number of common shares (the "Common Shares") of Oban Mining, Inc., a Nevada corporation ("Company"), indicated on the signature page hereto in consideration of US $O.50 per share ("Purchase Price") at the closings of the transactions contemplated hereby ("Transaction").
The execution by the Purchaser of this Subscription Agreement ("Subscription Agreement") will constitute an offer by the Purchaser to the Company to subscribe for the Common Shares. The Company's .. acceptance of such offer, as evidenced by the signature of its authorized officer below, will constitute an agreement between the Purchaser and the Company for the Purchaser to purchase from the Company, and for the Company to issue and sell to the Purchaser, the Common Shares upon the terms and conditions contained herein.
In connection with such subscription, Purchaser hereby agrees, represents and warrants as follows:
1. Agreement to Purchase; calculation of Number of Common Shares.
Purchaser hereby subscribes for and purchases that number of Common Shares set forth on the signature page hereto, at the times set forth therein, pursuant to the terms of this Subscription Agreement.
Simultaneously with the execution of this Subscription Agreement, the Purchaser shall pay to the Company the Purchase Price for the number of Common Shares subscribed for by wire transfer or check payable to "Oban Mining, Inc." which shall be applied to payment for the Common Shares subscribed for herein or by wire instructions as follows:
Bank: Sterling Savings Bank.
000 Xxxx Xxxxx
Xxxxx Xxxxxxx, X X 00000-0000Transit #: 000000000
Account #: 5999 070 8885
Beneficiary: Oban Mining, Inc.
The Company may accept or reject any subscription in whole or in part or may elect to allot to any prospective investor less than the number of Common Shares applied for by such investor.
2. Delivery of Common Shares
Subject to such earlier or later date as may be agreed to between the Company and the Purchaser, payment for the Purchase Price must be made to the Company no later than October 31, 2003.
Upon receipt of such payment, the Company shall deliver to the Purchaser a certificate (or certificates, if requested in writing by Purchaser) representing the number of Common Shares purchased,
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registered in the name of the Purchaser. The Company and the Purchaser also hereby agree to execute and deliver at Closing such other documents as may be necessary or appropriate.
3. Information Concerning: the Company
Purchaser acknowledges that he, she or it has received all such information as Purchaser deems necessary and appropriate to enable him, her or it to evaluate the financial risk inherent in making an investment in the Common Shares including but not limited to the Company's Confidential Offering Memorandum, and the documents and materials included therewith ("Disclosure Documents"). Purchaser further acknowledges that Purchaser has received satisfactory and complete information concerning the business and financial condition of the Company in response to all inquiries in respect thereof.
5. Economic Risk and Suitability
Purchaser represents and warrants as follows:
| (a) | Purchaser realizes that Purchaser's
purchase of the Common Shares involves a high degree of risk and will
be a speculative investment, and that he, she or it is able, without impairing
Purchaser's financial condition, to hold the Common Shares for an indefinite
period of time. |
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| (b) | Purchaser recognizes that there is no
assurance of future profitable operations and that investment in the Company
involves substantial risks, and that the Purchaser has taken full cognizance
of and understands all of the risks factors related to the purchase of
the Common Shares. |
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| (c) | Purchaser has carefully considered and
has, to the extent Purchaser believes such discussion necessary, discussed
with Purchaser's professional legal, tax and financial advisors the suitability
of an investment in the Company for the particular tax and financial situation
of Purchaser and that Purchaser and/or Purchaser's advisors have determined
that the Common Shares are a suitable investment for Purchaser. |
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| (d) | The financial condition and investment
of Purchaser are such that he, she or it is in a financial position to
hold the Common Shares for an indefinite period of time and to bear the
economic risk of, and withstand a complete loss of, the Purchase Price. |
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| (e) | Purchaser alone, or with the assistance
of professional advisors, has such knowledge and experience in financial
and business matters that the undersigned is capable of evaluating the
merits and risks of Purchaser's purchase of the Common Shares or has a
pre-existing personal or business relationship with the Company or any
of its officers, directors, or controlling persons of a duration and nature
that enables the undersigned to be aware of the character, business acumen
and general business and financial circumstances of the Company or such
other person. |
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| (f) | Purchaser has carefully read the Disclosure
Documents and the Company has made available to Purchaser or Purchaser's
advisors all information and documents requested by Purchaser relating
to investment in the Common Shares, and has provided answers to Purchaser's
satisfaction to all of Purchaser's questions concerning the Company and
the Offering. |
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| (g) | Purchaser has relied solely upon the
Disclosure Documents, advice of his or her representatives if any, and
independent investigations made by the Purchaser and/or his or her purchaser
representatives, if any, in making the decision to purchase the Common
Shares subscribed for herein and acknowledges that no representations
or agreements other than those set forth in the Disclosure Documents have
been made to the Purchaser in respect thereto. |
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| (h) | All information which the Purchaser
has provided concerning Purchaser himself, herself or itself is correct
and complete as of the date set forth below, and if there should be any
material change in such information prior to the acceptance of this subscription
for the Common Shares, he, she or it will immediately provide such information
to the Company. |
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| (i) | Purchaser confirms that Purchaser has
received no general solicitation or general advertisement and has attended
no seminar or meeting (whose attendees have been invited by any general
solicitation or general advertisement) and has received no advertisement
in any newspaper, magazine, or similar media, broadcast on television
or radio regarding the offering of the Common Shares. |
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| (j) | If a natural person, purchaser is at
least 21 years of age and resides at the address indicated below. |
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| 6. | Restricted Securities Purchaser acknowledges that the Company has hereby disclosed to Purchaser in writing: |
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| (a) | The Common Shares have not been registered
under the Securities Act of 1933, as amended (the "1933 Act"), or the
securities laws of any state of the United States or Canada, and such
securities are "restricted securities" that must be held indefinitely
unless a transfer of them is subsequently registered under the 1933 Act
or such securities are sold pursuant to Regulation S under the 1933 Act
or pursuant to an exemption from registration under the 1933 Act or are
sold pursuant to an exemption from prospectus in Canada; and |
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| (b) | The Company will make a notation in
its records of the above-described restrictions on transfer and of the
legend described below. |
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| 7. | Legend. Purchaser agrees that all of the certificates representing the Common Shares shall have endorsed thereon a legend in substantially the following form: THESE COMMON SHARES HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT") OR THE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES AND MAY BE OFFERED, SOLD OR OTHERWISE TRANSFERRED ONLY (I) TO THE COMPANY, (II) OUTSIDE THE UNITED STATES IN COMPLIANCE WITH RULE 904 OF REGULATION S UNDER THE 1933 ACT, (III) IN COMPLIANCE WITH THE EXEMPTION FROM REGISTRATION UNDER THE 1933 ACT PROVIDED BY RULE 144 THEREUNDER, OR (IV) IN COMPLIANCE WITH ANOTHER EXEMPTION FROM REGISTRATION, IN EACH CASE AFTER PROVIDING EVIDENCE SATISFACTORY TO THE |
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COMPANY THAT SUCH TRANSFER MAY BE MADE WITHOUT REGISTRATION UNDER THE 1933 ACT. HEDGING TRANSACTIONS INVOLVING THE SECURITIES REPRESENTED HEREBY MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH THE 1933 ACT. UNLESS PERMITTED UNDER SECURITIES LEGISLATION, THE HOLDER OF THE', SECURITIES SHALL NOT TRADE THE SECURITIES BEFORE THE EARLIER OF (I) THE DATE THAT IS 12 MONTHS AND A DAY AFTER THE DATE THE ISSUER FIRST BECAME A REPORTING ISSUER IN ANY OF ALBERTA, BRITISH COLUMBIA, MANITOBA, NOVA SCOTIA, ONTARIO, QUEBEC AN SASKATCHEWAN, IF THE ISSUER IS A SEDAR FILER; AND (II) THE DATE THAT IS 12 MONTHS AND A DAY AFTER THE LATER OF (A) THE DISTRIBUTION DATE, AND (B) THE DATE THE ISSUER BECAME A REPORTING ISSUER IN THE LOCAL JURISDICTION OF THE PURCHASE OF THE SECURITIES THAT ARE THE SUBJECT OF THE TRADE. |
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| 8. | Further Limitations on Disposition. Without in any way limiting its representations set forth above, Purchaser further agrees that it shall in no event make any disposition of all or any portion of the Common Shares unless: |
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| (a) | There is then in effect
a registration statement under the 1933 Act covering such proposed disposition
and such disposition is made in accordance with said registration statement;
or |
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| (b) | (i) Purchaser shall have
notified the Company of the proposed disposition and shall have --furnished
the Company with a reasonably detailed statement of the circumstance surrounding
the proposed disposition; (ii) Purchaser shall have furnished the Company
with an opinion of his or her counsel to the effect that such disposition
will not require registration under the 1933 Act; and (iii) such opinion
shall be in form and substance reasonably acceptable to counsel for the
Company and the Company shall have advised Purchaser of such acceptance. |
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| 9. | Offering Limited to Qualified Investors. Purchaser hereby represents and warrants to the Company as follows: |
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| (a) | (i) the Purchaser is not
a "U.S. Person," as such term is defined by Rule 902 of Regulation S under
the Act (the definition of which includes, but is not limited to, an individual
resident in the United States and an estate or trust of which any executor
or administrator or trustee, respectively, is a U.S. Person and any partnership
or corporation organized or incorporated under the laws of the United
States); |
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(ii) |
the Purchaser was outside the United
States at the time of execution and delivery of this Subscription Agreement; |
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(iii) |
no offers to sell the Common Shares
were made by any person to the Purchaser while the Purchaser was in the
United States; |
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(iv) |
the Common Shares are not being acquired,
directly or indirectly, for the account r or benefit of a U.S.
Person or a person in the United States; |
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(v) |
the Purchaser agrees not to engage in
hedging transactions with regard to the Common Shares prior to the expiration
of the one-year distribution compliance period set forth in Rule 903(bX3)
of Regulation S under the 1933 Act; and |
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(vi) |
the Purchaser acknowledges and agrees
with the Company that the Company shall refuse to register any transfer
of the Common Shares not made in accordance with the provisions of Regulation
S, pursuant to registration under the 1933 Act, or pursuant to an available
exemption from registration under the 1933 Act; or, |
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| (b) | that the Purchaser satisfies
one or more of the categories indicated below (please place an “X”
on the appropriate lines): |
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| _____ | Category 1. | An organization described in Section 501(c)(3) of
the United States Internal Revenue Code, a corporation, a Massachusetts
or similar business trust or partnership not formed for the specific purpose
of acquiring the Securities. with total assets in excess of US$5,000,000;
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| _____ | Category 2. | A natural person whose individual net worth, or joint
net 'Worth with that person's spouse, at the date hereof exceeds US$l,000,000;
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| _____ | Category 3. | A natural person who had an individual income in
excess of US$200,000 in each of the two most recent years or joint income
with that person's spouse in excess of US$300,000 in each of those years
and has a reasonable expectation of reaching the same income level in
the current year; |
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| _____ | Category 4. | A trust that (a) has total assets in excess of US$5,000,000,
(b) was not formed for the specific purpose of acquiring the Sec\1rities
and (c) is directed in its purchases of securities by a person who has
such la1owledge and experience in financial and business matters that
he/she is capable of evaluating the merits and risks of an investment
in the Common Shares; |
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| _____ | Catgeroy 5. | An investment company registered under the Investment
Company Act of 1940 or a business development company as defined in Section
2(a)(48) of that Act; |
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| _____ | Category 6. | A Small Business investment Company licensed by the
U.S. Small Business Administration under Section 301 (c) or (d) of the
Small Business Investment Act of 1958; |
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| _____ | Category 7. | A private business development company as defined
in Section 202(a)(22) of the Investment Advisors Acts of 1940; or |
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| _____ | Category 8. | An entity in which a1l of the equity owners satisfy
the requirements of one or more of the foregoing categories. |
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| 10. | Understandings. Purchaser understands, acknowled8es and agrees with the Company as follows: |
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(a) |
Except as set forth in paragraph 1 above,
the Purchaser hereby acknowledges and agrees that the subscription hereunder
is irrevocable by the undersigned, that, except as required by law, the
undersigned is not entitled to cancel, terminate or revoke this Subscription
Agreement or any agreements of the undersigned hereunder and that this
Subscription Agreement and such other agreements shall survive the death
or disability of the undersigned and shall be binding upon and inure to
the benefit of the parties and their heirs, executors, administrators,
successors, legal representatives and permitted assigns. If the undersigned
is more than one person, the obligations of the undersigned hereunder
shall be joint and several and the agreements, representations, warranties
and acknowledgments herein contained shall be deemed to be made by and
be binding upon each such person and his/her heirs, executors, administrators,
successors, legal representatives and permitted assigns. |
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(b) |
No federal or state agency has made
any finding or determination as to the accuracy or adequacy of the Disclosure
Documents or as to the fairness of the terms of this offering for investment
or any recommendation or endorsement of the Common Shares. |
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(c) |
The representations, warranties and
agreements of the undersigned contained herein and in any other writing
delivered in connection with the transactions contemplated hereby shall
be true and correct in all respects on and as of the date of the sale
of the Common Shares as if made on and as of such date and shall survive
the execution and delivery of this Subscription Agreement and the purchase
of the Common Shares. |
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(d) |
The common shares may not be transferred,
resold or otherwise disposed of except as permitted under the 1933 Act
and applicable state securities laws, pursuant to registration or exemption
therefrom. Purchasers should be aware that they would be required to bear
the financial risks of this investment for an indefinite period of time. |
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| 11. | Miscellaneous. |
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(a) |
On or after the date of this Agreement,
each of the parties shall, at the request of the other, furnish, execute
and deliver such documents and instruments and take such other action
as the requesting party shall reasonably require as necessary or desirable
to carry out the transactions contemplated herein. |
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(b) |
This Agreement, including all matters
of construction, validity and performance, shall be governed by and construed
and enforced in accordance with the laws of the State of Nevada, as applied
to contracts made, executed and to be fully performed in such state by
citizens of such State, without regard to its conflict of law rules. The
parties hereto agree that the exclusive jurisdiction and venue for any
action brought between the parties under this Agreement shall be the state
and federal courts sitting in Reno, Nevada, and each of the parties hereby
agrees and submits itself to the exclusive jurisdiction and venue of such
courts for such purpose. |
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(c) |
This Agreement comprises the entire
agreement between the parties. It may be changed only by further written
agreement, signed by both parties. It supersedes and merges within it
all prior agreements or understandings between the parties, whether written
or |
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oral. In interpreting or construing this A81'ecJnent,
the hot the! one or the other of the parties may have drafted this
Agreement or any provision shal1 not be given any weight or relevance |
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| (d) | This Agreement may be executed in counterparts, each
of which will be deemed to 'be an original and all of which will constitute
one agreement. A fascmilie cropy is deemed to be effective delivery of
this Agreement. |
Dated: 9th October, 2003.
| 314,000 | $ 157,000 | ||
| Number of Common Shares purchased | Aggregate Purchase Price | ||
| Xxxxxx X. Xxxxxx | |||
| For and on behalf of | |||
| APPOLLO INVESTMENTS LIMITED | Mandalaly Investments Inc. | ||
| Name – Typed or Printed | |||
| Director | |||
| Title (if applicable) |
0xx Xxxxx, Xxxxx Xxxx, Xxxxxxxx
Square, Pond Street, Grand Turk,
Subscriber’s Address: Turks and Caicos Islands, B.W.I
| (649) 946–2504 | ||
| Telephone Number | Social Security Number, ifany |
Manner m Which Title is to be Held. State precisely the name Or names in which the Common Shares are to be registered and whether the Common Shares are to be held as joint tenants with right of survivorship as tenants in common, individually or otherwise:
Mandalay Investments Inc.
ACCEPTANCE
The forgoing Subscription Agreement and the consideration reflected therein are hereby accepted.
| DATE; -October 17, 2003. | |
| OBAN MINING, INC. | |
| By: /s/ Xxxxxxx Xxxxxx |
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