IRREVOCABLE GUARANTEE AGREEMENT
IRREVOCABLE GUARANTEE AGREEMENT
THIS AGREEMENT MADE EFFECTIVE AS OF THE 21ST DAY OF FEBRUARY, 2003 (the "Effective Date").
BETWEEN:
(the “Company”)
AND:
XXXXXXXXX X. XXXX, of 0000 Xx Xxxxxx Xx, Xxxxxx Xxxxx XX, XXX 00000
(the "Guarantor")
WHEREAS:
A. the Company is entering into a line of credit agreement with The Toronto-Dominion Bank ("the "Creditor"), evidenced by the materials attached as Schedule "A" for a total of US$100,000 and referred to herein as the "Credit Line ", contingent upon the issuance of a suitable standby letter of credit ("LC") to the Creditor by Xxxxx Fargo, Laguna Beach CA branch;
B. the Guarantor has agreed to guarantee the LC by providing an unconditional and irrevocable guarantee for the amount of US$100,000 (the "Guarantee") to Xxxxx Fargo expiring at the office the Creditor on the close of business September 30, 2003;
C. the Guarantor has agreed to accept common share purchase warrants (the "Warrants") providing the Guarantor the right to purchase 109,462 common shares without par value (the "Shares") in the capital stock of the Company as consideration for providing the Guarantee, such Warrants to be exercisable at a price of Cdn $0.55 per Share and the total aggregate number of Shares calculated based on the Bank of Canada Noon Exchange Rate on the effective date of this agreement, of C$/US$1.5051;
D. the Guarantor is a person to whom the Company may issue securities pursuant to the exemption (the "Exemptions") provided by B.C. Instrument #72-503 of the British Columbia Securities Act, Rules, Regulations, Instruments or Notices; and
E. the Warrants will be issued pursuant to the Exemptions and that the Company is relying on the Exemptions from the requirements to provide the purchaser with a prospectus and to sell securities through a person registered to sell securities under the B.C. Securities Act and, as a consequence of acquiring securities pursuant to the Exemptions, certain protections, rights and remedies provided by the B.C. Securities Act, including statutory rights of rescission or damages, will not be available to the purchaser.
NOW THEREFORE THIS AGREEMENT WITNESSETH THAT in consideration of the mutual covenants and agreements herein contained, the receipt and sufficiency of which is hereby acknowledged, the parties covenant and agree with each other (the "Agreement") as follows:
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| 1. | On the basis of the representations
and warranties of the Guarantor contained in this Agreement and subject
to the terms of this Agreement, the Company agrees to issue the Warrants
to or at the direction of the Guarantor as full consideration for providing
the Guarantee. |
| 2. | For the term of the Guarantee, the Company
agrees to inform the Guarantor of the Credit Line balance by e-mail or
fax on the last business day of each calendar month. |
| 3. | This Agreement is subject to all necessary
approvals of the TSX Venture Exchange (the "Exchange") and the B.C. Securities
Commission (the "Regulators"). |
| 4. | Subject to the Creditor having first
accepted a LC from Bank Xxxxxxx and the Creditor and the Company executing
the Credit Line, the Company shall deliver a warrant certificate representing
the Warrants to the Guarantor at his address shown on the first page of
this Agreement within ten days of receiving written notice of the last
of the approvals of the Regulators. |
| 5. | The Guarantor acknowledges that the
Shares will be subject to a four (4) month hold period from the
date of the issuance of the Warrants imposed by the Exchange and by the
operation of applicable securities rules or by applicable securities regulatory
bodies, and that a share certificate issued within four months of issuing
the Warrants, as a result of exercising the Warrants, will bear legends
to that effect. |
| 6. | The Guarantor acknowledges that this
Agreement is not being entered into and the Warrants are not being acquired
by the Guarantor as a result of any material information about the Company's
affairs that has not been publicly disclosed. |
| 7. | In the event of any subdivision, consolidation
or other change in the share capital of the Company prior to the issuance
of the Warrants, the number of Warrants issued pursuant to this Agreement
shall be adjusted in accordance with such subdivision, consolidation or
other change in the share capital of the Company. |
| 8. | Time shall be of the essence in this
Agreement. |
| 9. | This Agreement is subject to, governed
by and construed in accordance with the laws of the Province of British
Columbia. |
| 10. | All references to funds in this Agreement
are in Canadian funds unless otherwise noted. |
| 11. | This Agreement shall enure to the benefit
of and be binding upon the parties hereto and their respective heirs,
executors, administrators, successors and assigns. |
| 12. | The parties hereto agree to execute
and deliver all such further documents and other writings of any kind
whatsoever and all such further acts and things as are reasonably required
to carry out the full intent and meaning of this Agreement. |
| 13. | Whenever the singular or masculine is
used in this Agreement the same shall be deemed to include the plural
or the feminine or the body corporate as the context may require. |
| 14. | This Agreement constitutes the entire
agreement between the parties and there are no representations, warranties,
covenants or agreements collateral hereto other than as contained herein. |
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| 15. | This Agreement may be signed in as many counterparts
as may be deemed necessary, each of which so signed shall be deemed to
be an original, and all such counterparts together shall constitute one
and the same instrument. |
IN WITNESS WHEREOF the parties have executed this written Agreement effective
as of the Effective Date.
SIGNED, SEALED AND DELIVERED BY
RESPONSE BIOMEDICAL CORP. per:
/s/ Xxxxxxx Xxxxx
Authorized Signatory
Name of Signatory: Xxxxxxx Xxxxx
Title of Signatory: President
& CEO
| SIGNED, SEALED & DELIVERED | ) | |
| by XXXXXXXX XXXX | ) | |
| in the presence of: | ) | |
| ) | ||
/s/ Xxx Xxxx |
) | XXXXXXXX X. XXXX |
| Signature of Witness | ) | |
| ) | Per: | |
| Name: Xxx Xxxx | ) | |
| ) | /s/ Xxxxxxxxx Xxxx | |
| 413 - 000 Xxxx 00xx Xxxxxx | ) | Duly Authorized Signatory of the Guarantor |
| Address: Vancouver, BC | ) | |
| ) | ||
| Occupation: Controller | ) |
| XXXXX FARGO |
XXXXX FARGO BANK, N.A. | |
| TRADE SERVICES DIVISION, NORTHERN CALIFORNIA | ||
| 000 XXXXXX XXXXXX, 00XX XXXXX | ||
| XXX XXXXXXXXX, XXXXXXXXXX 00000 | ||
| TEL: 1-800-798.2815, option I | TD BAN K | |
| Fax: (000) 000-0000 | OLD REF: 5815761 | |
| Email: xxxxxxx@xxxxxxxxxx.xxx | Page 1 of 2 PAGES | |
| IRREVOCABLE LETTER OF CREDIT | ||
| Beneficiary: | |
| Toronto Dominion Bank | Letter of Credit No. NZS4'S73$7 |
| 000 Xxxx Xxxxxxx Xxxxxx, 0xx Xxxxx | Date: February 13, 2003 |
| Xxxxxxxxx, XX X0X 0X0 | Expiry Date: September 30, 2003 |
| at our above counters |
Attn: Kathrin Teichried
Ladies and Gentlemen:
We hereby establish our irrevocable Letter of Credit In your favor for the account of Xxxxxxxxx Xxxx, 000 Xxxxxx Xxxxx Xxxxx, Xxxxxx Xxxxx, XX 00000, for drawings up to the aggregate amount of Xxx Xxxxxxx Xxxxxxxx xxx 00/000 Xxxxxx Xxxxxx Dollars (US$100,000.00), available by your drafts at sight drawn on Welts Fargo, N.A., San Francisco, CA and accompanied by:
Your signed and dated statement worded as follows.
"The undersigned, an authorized representative of Toronto Dominion Bank. hereby certifies that this drawing represents outstanding and unpaid principal and Interest due and owing, calculated up to the value date of the present demand, in connection with an agreement between Response Biomedical Corp and Toronto Dominion Bank."
Each draft must be marked: "Drawn under Xxxxx Fargo Bank, N.A. Letter of Credit Nn, NZS467387" and must be accompanied by the original of this Letter of Credit for our endorsement on this Letter of Credit of the amount of our payment on such draft.
Partial Drawings are permitted (more than one draft may be drawn and presented under the Letter of Credit).
We hereby undertake to promptly honor your sight draft(s) drawn on us in your favor, for all or any part of this Letter of Credit, if presented to us at our above address, on or before the expiry date.
All banking charges and commissions are for applicant's account.
If any instructions accompanying a drawing under this Letter of Credit request that payment is to be made by transfer to an account with us or at another bank, we and/or such other bank may rely on an account number specified in such instructions even if the number identifies a person or entity different from the intended payee.
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| TD BAN K | |
| OLD REF: 5815761 | |
| Page 2 of 2 PAGES |
This is an integral part of our Letter of Credit No. NZS467387
Documents must be presented to us not later than 5:00 P.M.
Documents must be forwarded to us via courier in one parcel and may be mailed to Xxxxx Fargo Bank, N.A., Trade Services Ops-North Wkstn.A, 525 Market Street, 25th Floor, MAC A0103-255, Xxx Xxxxxxxxx, XX 00000.
This Letter of Credit is subject to the Uniform Customs and Practice for Documentary Credits (1993 Revision), International Chamber of Commerce Publication No. 500 (the "UCP") and engages us in accordance with the terms thereof.
| Very truly yours, | ||
| XXXXX FARGO BANK, N. A. | ||
| By | /s/ XXXXX X. XXXXX | |
| XXXXX X. XXXXX, VICE PRESIDENT |
||
| (Name and Title) | ||
| By | /s/ A. R. CHAUDHARY | |
| A. R. CHAUDHARY, VICE PRESIDENT |
||
| (Name and Title) | ||
