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THIS AGREEMENT dated February 16, 1999, is made
BETWEEN
CANACCORD CAPITAL CORPORATION, a member of the Vancouver Stock
Exchange (the "Exchange"), of Suite 2200 - 000 Xxxxxxxxx Xxxxxx,
Xxxxxxxxx, Xxxxxxx Xxxxxxxx, X0X 0X0
(the "Member");
AND
PANORAMIC CARE MANAGER, INC., a company incorporated under the law of
Colorado, of 00000 Xxxx 00xx Xxxxx, Xxxxxx, Xxxxxxxx, 00000
(the "Issuer").
WHEREAS:
A. The Issuer has not previously carried out a distribution of its securities
to the public, and intends to file a conditional listing application to list its
common shares (the "Shares") on the Vancouver Stock Exchange (the "Exchange")
(the "Transaction");
B. Pursuant to Exchange Policy No. 4 as amended ("Policy No. 4"), the
Exchange requires that the Issuer obtain a member to act as its sponsor within
the meaning of Policy No. 4 as a condition of approval of the Transaction;
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THE PARTIES to this Agreement therefore agree:
1. DEFINITIONS AND INTERPRETATION
1.1 DEFINITIONS
In this Agreement:
(a) "Act" means the Securities Act, (British Columbia), R.S.B.C. 1996, as
amended, the regulations and rules made thereunder and all
administrative policy statements, blanket orders, notices, directions
and rulings issued by the Commission;
(b) "Approval Date" means the date the Shares commence trading on the
Exchange;
(c) "Business" means the corporate undertaking of the Issuer;
(d) "Canadian Securities Acts" means the securities legislation in force
in each of the provinces of Canada;
(e) "Commission" means the British Columbia Securities Commission;
(f) "Control Block" means a holding of Shares or other securities of the
Issuer or both held by a person or combination of persons acting
jointly or in concert to which are attached more than 20% of the
voting rights attached to all outstanding Voting Securities;
(g) "Exchange" has the meaning assigned above;
(h) "Exchange Policy" means a policy listed in the Exchange's Corporate
Finance Services Policy and Procedures Manual;
(i) "Issuer" has the meaning assigned above and includes any wholly-owned
or partially-owned subsidiaries of the Issuer;
(j) "Material Change" has the meaning defined in the Act;
(k) "Member" has the meaning assigned above;
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(l) "Proceeds" means the proceeds from the Public Offering, if any;
(m) "Public Offering" means the offering of the Issuer's securities
contemplated to be made by the Member as agent contemporaneously with
or after the closing of the Transaction, if any;
(n) "Quarterly Report" means a report of the Issuer in Form 61 to the Act;
(o) "Reports" means any business plans, engineering reports, geological
reports, technical reports, valuation opinions or similar documents
concerning the Business;
(p) "Transaction" has the meaning assigned in Recital A; and
(q) "Voting Security" means a security of the Issuer that carries a voting
right under all circumstances.
2. INVESTIGATION BY MEMBER
2.1 The Issuer shall at all times afford full access to the Member and its
authorized representatives to all properties, books, contracts, commitments and
other corporate records, and shall furnish the Member with copies thereof and
such other information concerning the Business as the Member may request, in
order that the Member may undertake an investigation of the Issuer and the
Business.
2.2 The Issuer shall forthwith provide the Member with:
(a) the most recent audited financial statements concerning the Issuer,
and unaudited financial statements, prepared as of a date satisfactory
to the Member in draft if the financial statements have not been
finalized;
(b) such information as necessary so as the Member can prepare a
Pre-Listing Application and Fact Sheet in the form required by the
Exchange;
(c) a draft disclosure document (prospectus or filing statement)
appropriate to the Transaction;
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(d) fully completed and executed personal information forms in Form 4B to
the Act for all directors and officers;
(e) copies of all Reports which are available, in final form or in draft
if such Reports have not been finalized;
(f) questionnaires, in the form provided by the Member, completed in full
by each of its directors and each member of its senior management;
(g) copies of all relevant material contracts.
2.3 Upon conclusion of its investigation, the Member shall give notice to
the Issuer whether it has decided to act as the Issuer's sponsor with regard to
the Transaction.
3. TERM
This Agreement shall be effective from the date hereof until:
(a) if the Member gives notice to the Issuer that it has decided not to
act as the Issuer's sponsor with regard to the Transaction, the date
such notice is given; or
(b) if the Member gives notice to the Issuer that it has decided to act as
the Issuer's sponsor with regard to the Transaction, the close of
business on that day falling one year from the Approval Date;
unless it is terminated earlier by the Member in accordance herewith.
4. FEE
4.1 The Issuer will pay the Member a fee of U.S. $10,000.00 (plus
G.S.T.) (PAID) in consideration of the Member acting as the Issuer's sponsor
with regard to the Transaction. The Fee will be due as to (a) 50% upon execution
of this Agreement and; (b) 50% upon acceptance of the Issuer's Application by
the Pre-Listing Advisory Committee of the Exchange.
The Member's G.S.T. Number is 133567545.
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4.2 The Issuer's obligation to pay the above fee earned by the Member up
to the date of termination of this Agreement shall survive the termination of
this Agreement.
5. COVENANTS OF THE ISSUER
5.1 If, during the term of this Agreement, a Material Change in the
assets, liabilities (contingent or otherwise), business, operations or capital
of the Issuer should occur, or be anticipated or threatened, the Issuer shall
notify the Member immediately, in writing, with full particulars of the change.
5.2 If the Issuer is not certain as to whether a Material Change has
occurred, the Issuer shall promptly notify the Member in writing of the full
particulars of the event giving rise to the uncertainty, and shall consult with
the Member as to whether such event constitutes a Material Change.
5.3 The Issuer shall provide the Member with copies of all Reports
forthwith upon preparation or receipt of same.
5.4 The Issuer shall notify the Member of:
(a) any change proposed to be made in the Business;
(b) any proposed issuance of a Control Block;
(c) any proposed sale or other disposition of any outstanding shares in
the capital of any Subsidiaries wholly or partially owned by the
Issuer;
forthwith upon the proposal of such change, issuance, sale or disposition.
5.5 The Issuer shall notify the Member of any proposed change to the
constitution of the Board of Directors of the Issuer, or to the membership of
senior management of the Issuer, forthwith upon the proposal of such a change.
Forthwith after giving such notification, the Issuer shall provide the Member
with a questionnaire in the form provided by the Member, completed in full by
the proposed candidate. The Issuer shall promptly notify the Member, in writing
of any
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resignations, terminations or departures of members of the Board of Directors or
senior management.
5.6 The Member reserves its right to terminate this Agreement, resign as
sponsor and to notify the Exchange of its decision to resign should it object to
any of the proposed changes set forth in Subsections 5.4 and 5.5.
5.7 The Issuer shall provide the Member with copies of all Quarterly
Reports, press releases, promotional materials, material change reports,
materials prepared in connection with the Issuer's annual general meeting and
any special meetings of shareholders, annual reports, and financial statements
prepared by or for the Issuer forthwith upon preparation or receipt of the same.
5.8 The Issuer shall notify the Member of any circumstances where the
Issuer does not expect to comply with a filing deadline imposed by regulatory
authorities. Where possible, such notification shall be provided at least 10
business days before the deadline.
5.9 If the Issuer sells Shares or other securities to the public during
the Member's term as sponsor, then, commencing the last day of the month in
which such sale closes, the Issuer will, upon request by the Member, provide the
Member with quarterly sources and uses of funds statements within 15 days
of each month's end. Such statements will illustrate variances with the use of
proceeds set out in the prospectus prepared in connection with the sale of
Shares or other securities.
5.10 The Issuer shall at all times use its best efforts to assist the
Member in carrying out its duties as sponsor.
5.11 The Issuer acknowledges that it has appointed Xxxx Xxxxxxxxx as its
officer responsible for carrying out its reporting obligations to the Member
hereunder, and agrees that the Member may direct and address all inquiries and
submit all notices hereunder to the attention of Xxxx Xxxxxxxxx.
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5.12 Nothing in this Agreement is or shall be construed as a xxxxxx on the
discretion of the directors of the Issuer.
5.13 All information relating to the Issuer provided by the Issuer to the
Member shall be directed to the corporate finance department of the Member, and
the Issuer will not disclose to any other person associated with the Member any
information relating to the Issuer which is not publicly available.
6. ACKNOWLEDGEMENTS OF ISSUER
6.1 The Issuer acknowledges that the Member has informed the Issuer and
its directors and management of their responsibilities concerning continuous and
timely disclosure under the Act, and in particular, without limitation, of the
Issuer's responsibility to issue a press release, and file a material change
report, in the event of a Material Change in the business, operations, assets or
ownership of the Issuer. The Issuer further acknowledges in this regard that it
has been made aware by the Member of the services offered by commercial news
disseminators.
6.2 The Issuer acknowledges that the Member has advised the Issuer
concerning the Exchange's on-going requirements concerning the minimum
distribution of the Shares.
7. REPRESENTATIONS, WARRANTIES AND INDEMNIFICATIONS OF THE ISSUER
7.1 The Issuer warrants and represents to the Member, and acknowledges
that the Member has relied on such warranties and representations in entering
into this Agreement, that:
(a) the responses in all questionnaires completed by the directors and
senior management personnel of the Issuer and provided to the Member
pursuant to this Agreement shall be accurate and complete;
(b) the descriptions of the assets and the liabilities of the Issuer set
out in the balance sheets of the Issuer, including the notes thereto,
to be provided to the Member will be true and correct, will accurately
and fairly present the financial position and condition of the Issuer
as at the respective dates thereof, will reflect all liabilities
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(absolute, accrued, contingent or otherwise) of the Issuer at the
respective dates thereof and will be prepared in accordance with
generally accepted accounting principles, applied on a consistent
basis;
(c) the statement of earnings, retained earnings and changes in financial
position of the Issuer, including the notes thereto, to be provided to
the Member will in each case accurately and fairly present the results
of the operations of the Issuer for the respective periods covered
thereby and will be prepared in accordance with generally accepted
accounting principles applied on a consistent basis throughout such
period;
(d) the financial position of the Issuer as at the date hereof is no less
favourable than that disclosed in the latest draft balance sheets
provided to the Member;
(e) the information concerning the Business which will be provided to the
authors of the Reports will be accurate, complete and fair, and the
Reports, to the best of the knowledge of the Issuer, will be fair and
accurate in all particulars;
(f) to the extent that they are required to do so, the authors of the
Reports will possess all of the qualifications required by the
Exchange and the Commission of authors of such reports;
(g) the information contained in the sources and uses of funds statements
to be provided to the Member hereunder will be accurate and complete;
(h) the execution of this Agreement by the Issuer does not and will not
conflict with, and does not and will not result in a breach of, or
constitute a default under, any agreement or instrument to which the
Issuer is a party, or by which the Issuer is bound, or the terms of
the incorporating documents of the Issuer;
(i) the execution of this Agreement has been authorized by all necessary
corporate action on the part of the Issuer;
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(j) as of the date hereof:
(i) there has not been any Material Change in the assets,
liabilities or obligations (absolute, accrued, contingent or
otherwise) of the Issuer;
(ii) there has not been any Material Change in the capital or
long-term debt of the Issuer;
(iii) there has not been any Material Change in the Business, business
prospects, condition (financial or otherwise) or results of the
operation of the Issuer;
from those disclosed in the most recent [consolidated] draft financial
statements provided to the Member of which the Member has not been
made aware by the Issuer;
(k) since the date of the most recent financial statements provided
to the Member, the Issuer has carried on the Business in the
ordinary course;
(l) the Issuer is duly registered and licensed to carry on business
in the jurisdictions which it carries on business or owns
property;
(m) no order suspending the sale of or ceasing the trading in the
Shares or other securities of the Issuer has been issued and not
rescinded, revoked or withdrawn by any securities commission,
regulatory authority or stock exchange in any jurisdiction, and
no proceedings for that purpose have been instituted or are
pending or are, to the knowledge of the directors or senior
management of the Issuer, contemplated or threatened by any
securities commission, regulatory authority or stock exchange;
(n) no enquiry or investigation, formal or informal, in relation to
the Issuer or the Issuer's directors or senior management, has
been commenced or threatened by any official or officer of any
securities commission, regulatory authority or stock exchange;
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7.2 The representations and warranties of the Issuer set forth in
Subsection 7.1 hereof shall continue to be true and accurate throughout the term
of this Agreement.
7.3 The Issuer shall indemnify and save harmless the Member, and each
director, officer, employee or agent of the Member (collectively, the
"Indemnified Parties"), from and against all losses, claims, damages,
liabilities, costs or expenses caused or incurred by the Indemnified Parties
arising or resulting from any breach by the Issuer of any of the terms of this
Agreement.
7.4 If any action or claim is brought against an Indemnified Party in
respect of which indemnity may be sought from the Issuer pursuant to this
Agreement, the Indemnified Party will promptly notify the Issuer in writing.
7.5 The Issuer will assume the defense of the action or claim, including
the employment of counsel and the payment of all expenses.
7.6 The Indemnified Party will have the right to employ separate counsel,
and the Issuer will pay the fees and expenses of such counsel.
7.7 The indemnity provided for in this Section will not be limited or
otherwise affected by any other indemnity obtained by the Indemnified Party from
any other person in respect of any matters specified in this Agreement and will
continue in full force and effect until all possible liability of the
Indemnified Party arising out of this Agreement has been extinguished by the
operation of law.
7.8 If indemnification under this Agreement is found in a final judgment
(not subject to further appeal) by a court of competent jurisdiction not to be
available for reason of public policy, the Issuer and the Indemnified Parties
will contribute to the losses, claims, damages, liabilities or expenses (or
actions in respect thereof) for which such indemnification is held unavailable
in such proportion as is appropriate to reflect the relative benefits to and
fault of the Issuer, on the one hand, and the Indemnified Parties on the other
hand, in connection with the matter giving rise to such losses, claims, damages,
liabilities or expenses (or actions in respect thereof). No person found liable
for a fraudulent misrepresentation (within the meaning of applicable securities
laws)
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will be entitled to contribution from any person who is not found liable
for such fraudulent misrepresentation.
7.9 To the extent that any Indemnified Party is not a party to this
Agreement, the Member will obtain and hold the right and benefit of this section
in trust for and on behalf of such Indemnified Party.
8. RIGHT OF FIRST REFUSAL
8.1 The Issuer will notify the Member of the terms of any equity
financing that it requires or proposes to obtain during the term of this
Agreement, and the Member will have the right of first refusal to provide any
such financing.
8.2 The right of first refusal must be exercised by the Member within 15
days following the receipt of the notice referred to in Subsection 8.1 by
notifying the Issuer that it will provide the financing on the terms set out in
the notice.
8.3 If the Member fails to give notice within the time provided for in
Subsection 8.2, the Issuer shall then be free to make other arrangements to
obtain the financing from another source on the same terms or on terms no less
favourable to the Issuer.
8.4 The Member's right of first refusal will not terminate if, on receipt
of any notice from the Issuer under this Section, the Member fails to exercise
the right.
8.5 The right of first refusal granted under this Section shall terminate
one year from the Approval Date.
9. TERMINATION
9.1 The Member may terminate this Agreement in any of the following
events:
(a) if an adverse Material Change (actual, anticipated or threatened) in
the assets, liabilities (contingent or otherwise), business operations
or capital of the Issuer should occur;
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(b) if, after completion of the Transaction, any order is made suspending
trading in the Shares on the Exchange, or any order to cease or
suspend trading in the Shares is made pursuant to any of the Canadian
Securities Acts or is made by any other regulatory authority, and is
not rescinded, revoked or withdrawn within 30 days of the making
thereof;
(c) if any enquiry or investigation (whether formal or informal) in
relation to the Issuer or the Issuer's directors or senior management,
is commenced or threatened by an officer or official of any securities
regulatory authority in Canada or by any officer or official of any
other competent authority;
(d) if the Issuer shall at any time be in breach of any of the terms of
this Agreement;
(e) if the Issuer determines to take a course of action referred to in
Subsections 5.4 or 5.5 to which the Member has notified the Issuer in
writing it objects;
(f) if the Member determines that any representation or warranty made by
the Issuer in this Agreement is false or has become false.
9.2 Any termination by the Member hereunder shall be made by notice in
writing to the Issuer. Notwithstanding the giving of any notice of termination
hereunder, the expenses and fees agreed to be paid by the Issuer incurred up to
the time of the giving of such notice shall be paid by the Issuer as herein
provided.
9.3 The Issuer acknowledges and agrees that, if the Member terminates this
Agreement, the Member shall comply with all applicable provisions of Policy No.
4 relating to termination of sponsorship, including the filing of a letter
explaining the termination with the Exchange. In such event, the Member may
disclose to the Exchange such information concerning the Issuer as the Member in
its sole discretion considers to be necessary to fulfill its obligations to the
Exchange and the requirements of Policy No. 4, including any information which
the Issuer has disclosed to the Member on a privileged or confidential basis.
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9.4 The rights of the Member to terminate this Agreement are in addition
to such other remedies as it may have in respect of any default,
misrepresentation, act or failure of the Issuer in respect of any of the matters
contemplated by this Agreement.
9.5 The Issuer may terminate this Agreement upon giving 30 days written
notice to the Member.
10. EXPENSES OF MEMBER
10.1 The Issuer will pay all of the expenses reasonably incurred by the
Member in connection herewith, including, without limitation, the fees and
expenses of any solicitors which might be retained by the Member in connection
herewith.
10.2 The Member may, from time to time, render accounts for such expenses
to the Issuer for payment on the dates set out in such accounts.
10.3 The Issuer's covenant to pay the Member's expenses shall survive
termination of this Agreement.
11. NOTICE
11.1 Any notice under this Agreement will be given in writing and must be
delivered, sent by facsimile transmission or mailed by prepaid post and
addressed to the party to which notice is to be given at the address indicated
above, or at another address designated by such party in writing.
11.2 If notice is sent by facsimile transmission or is delivered, it will
be deemed to have been given at the time of transmission or delivery.
11.3 If notice is mailed, it will be deemed to have been received 48 hours
following the date of mailing of the notice.
11.4 If there is an interruption in normal mail service due to strike,
labour unrest or other cause at or prior to or within 48 hours of the time a
notice is mailed the notice will be sent by facsimile transmission or will be
delivered.
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12. TIME
Time is of the essence of this Agreement and will be calculated in accordance
with the provisions of the Interpretation Act (British Columbia).
13. LANGUAGE
Wherever a singular or masculine expression is used in this Agreement, that
expression is deemed to include the plural, feminine or the body corporate where
required by the context.
14. ENTIRE AGREEMENT
This Agreement constitutes the entire agreement between the parties hereto with
respect to the subject matter hereof and cancels and supersedes any prior
understandings and agreements between the parties hereto with respect thereto.
15. COUNTERPARTS
This Agreement may be executed in two or more counterparts and may be delivered
by telecopier. Each executed counterpart will be deemed to be an original, and
all of them will constitute one agreement, effective as of the reference date
given above.
16. HEADINGS
The headings in this Agreement are for convenience of reference only and do not
affect the interpretation of this Agreement.
17. ENUREMENT
This Agreement enures to the benefit of and is binding on the parties to this
Agreement and their successors.
18. LAW
This Agreement is governed by the law of British Columbia, and the parties
hereto irrevocably attorn and submit to the jurisdiction of the courts of
British Columbia with respect to any dispute related to this Agreement.
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The common seal of )
CANACCORD CAPITAL CORPORATION )
was hereunto affixed in the )
presence of: )
)
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Authorized Signatory ) c/s
)
)
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Authorized Signatory )
)
)
The common seal of )
PANORAMIC CARE MANAGER, INC. )
was hereunto affixed in the )
presence of: )
)
)
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Authorized Signatory ) c/s
)
)
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Authorized Signatory )
