EXHIBIT 99.2
First Financing Subscription Agreement
SUBSCRIPTION AGREEMENT - ss. 74(2)(4)
THIS AGREEMENT MADE EFFECTIVE AS OF THE 6TH DAY OF APRIL, 2000 (the "Effective
Date").
BETWEEN: IQROM COMMUNICATIONS INC. (Formerly Hiking Adventures Inc.)
Suite 400 - 127, 000 Xxxx Xxxxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxxxx 00000
AND:
THE PARTY NAMED AS PURCHASER BELOW
XXXXX XX
Xxxxxxxxxxx 00, XX - 0000 Xxxxx
Xxxxxxxxxxx, 262-9490
WHEREAS:
A. The Purchaser wishes to subscribe for 400,000 units (each, a "Unit"),
where each Unit consists of one common share (each, a "Share") and
one-half of one non-transferable share purchase warrant (each whole
warrant is a "Warrant"), of the Company (together, the "Securities");
B. It is the intention of the parties to this Agreement that this
subscription will be made pursuant to appropriate exemptions (the
"Exemptions") from the registration and prospectus or equivalent
requirements of all rules, policies, notices, orders and legislation of
any kind whatsoever (collectively the "Securities Rules") of all
jurisdictions applicable to this subscription;
NOW THEREFORE THIS AGREEMENT WITNESSES that in consideration of the mutual
covenants and agreements herein contained, the receipt of which is hereby
acknowledged, the parties covenant and agree with each other (the "Agreement")
as follows:
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1. Representations and Warranties of the Purchaser
1.1 The Purchaser represents and warrants to the Company, and
acknowledges that the Company is relying on these representations
and warranties to, among other things, ensure that it is
complying with all of the applicable Securities Rules, that:
(a) the Purchaser is purchasing a sufficient number of
Securities such that the aggregate acquisition cost to the
Purchaser of such Securities is not less than $97,000, if
the Purchaser is a resident of British Columbia, Alberta,
Manitoba, New Brunswick, Xxxxxx Xxxxxx Island, Newfoundland
or an International Jurisdiction, or $150,000 if the
Purchaser is a resident of Saskatchewan, Ontario, Quebec or
Nova Scotia, and the Purchaser is:
(i) purchasing such Securities as principal for its own account
and not for the benefit of any other person; or
(ii) deemed to be acting as principal by virtue of it being:
A. a trust company or insurer which is authorized to carry
on business in B.C. under the Financial Institutions
Act (British Columbia) and which is acting as agent or
trustee for accounts that are fully managed by it
within the meaning of ss. 74(1)(a) of the Securities
Act (British Columbia (the "Act") and NIN #97/11 issued
by the B.C. Securities Commission (the "Commission");
or
B. a portfolio manager within the meaning of ss. 1(1) of
the Act which is carrying on business in B.C. and which
is registered or exempt from registration under the Act
and which is acting as agent for accounts that are
fully managed by it within the meaning of ss. 74(1)(b)
of the Act and NIN #97/11; or
C. a trust company, insurer or portfolio manager within
the meaning of BOR #97/4 issued by the Commission which
is acting, in the case of a trust company or insurer,
as agent or trustee or, in the case of a portfolio
manager, as agent, for accounts that are fully managed
by it within the meaning of BOR #97/4and NIN #97/11;
and the Purchaser is also deemed to be acting as
principal under the analogous provisions of any other
Securities Rules having application;
(b) the Purchaser has not been formed, created, established or
incorporated for the purpose of permitting the purchase of
the Securities without a prospectus by groups of
individuals whose individual share of the aggregate
acquisition cost for such Securities is less than $97,000,
if the beneficial purchaser is a resident of British
Columbia, Alberta, Manitoba, New Brunswick, Xxxxxx Xxxxxx
Island, Newfoundland or an International Jurisdiction, or
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$150,000 if the beneficial purchaser is a resident of
Saskatchewan, Ontario, Quebec or Nova Scotia;
(c) if the Purchaser is resident of an "International
Jurisdiction" (which means a country other than Canada or
the United States) then:
(i) the Purchaser is knowledgeable of, or has been
independently advised as to, the applicable Securities
Rules of the International Jurisdiction which would apply
to this subscription, if there are any;
(ii) the Purchaser is purchasing the Securities pursuant to
Exemptions under the Securities Rules of that International
Jurisdiction or, if such is not applicable, the Purchaser
is permitted to purchase the Securities under the
applicable Securities Rules of the International
Jurisdiction without the need to rely on Exemptions; and
(iii) the applicable Securities Rules do not require the Company
to make any filings or seek any approvals of any kind
whatsoever from any regulatory authority of any kind
whatsoever in the International Jurisdiction; and
the Purchaser will, if requested by the Company, deliver to
the Company a certificate or opinion of local counsel from the
International Jurisdiction which will confirm the matters
referred to in subparagraphs (ii) and (iii) above to the
satisfaction of the Company, acting reasonably;
(d) the Purchaser acknowledges that the Company is relying on
the Exemptions in order to complete the trade and
distribution of the Securities and the Purchaser is aware
of the criteria of the Exemptions to be met by the
Purchaser, including those referred to in the Form 20A
attached hereto and, if applicable, the Purchaser meets
those criteria;
(e) the Purchaser acknowledges that because this subscription
is being made pursuant to the Exemptions:
(i) the Purchaser is restricted from using certain of the civil
remedies available under the applicable Securities Rules;
(ii) the Purchaser may not receive information that might
otherwise be required to be provided to the Purchaser under
the applicable Securities Rules if the Exemptions were not
being used; and
(iii) the Company is relieved from certain obligations that would
otherwise apply under the applicable Securities Rules if
the Exemptions were not being used;
(f) the Securities are not being subscribed for by the
Purchaser as a result of any material information about the
Company's affairs that has not been publicly disclosed;
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(g) the offer and sale of these Securities was not accompanied
by an advertisement and the Purchaser was not induced to
purchase these Securities as a result of any advertisement
made by the Company; and
(h) if the Purchaser is a corporation, the Purchaser is a valid
and subsisting corporation, has the necessary corporate
capacity and authority to execute and deliver this
Agreement and to observe and perform its covenants and
obligations hereunder and has taken all necessary corporate
action in respect thereof, or, if the Purchaser is a
partnership, syndicate, trust or other form of
unincorporated organization, the Purchaser has the
necessary legal capacity and authority to execute and
deliver this Agreement and to observe and perform its
covenants and obligations hereunder and has obtained all
necessary approvals in respect thereof, and, in either
case, upon the Company executing and delivering this
Agreement, this Agreement will constitute a legal, valid
and binding contract of the Purchaser enforceable against
the Purchaser in accordance with its terms and neither the
agreement resulting from such acceptance nor the completion
of the transactions contemplated hereby conflicts with, or
will conflict with, or results, or will result, in a breach
or violation of any law applicable to the Purchaser, any
constating documents of the Purchaser or any agreement to
which the Purchaser is a party or by which the Purchaser is
bound; and
(i) the Purchaser is not, and was not at any time that it
purchased the Securities or received an offer to purchase
the Securities pursuant to this subscription, a "U.S.
Person" as defined in Regulation S under the United States
Securities Act of 1933, as amended (the "U.S. Securities
Act"), which definition includes, but is not limited to, an
individual resident in the United States, 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;
(j) the Purchaser did not receive any term sheet, subscription
form or other offering materials in connection with this
subscription in the United States, and did not execute or
deliver any such subscription form or other materials in
the United States;
(k) no offers of Securities were made by any person to the
Purchaser while the Purchaser was in the United States; and
(l) the Purchaser is not acquiring Securities, directly or
indirectly, for the account or benefit of a U.S. Person or
a person in the United States.
1.2 The Company represents and warrants to the Purchaser, and
acknowledges that the Purchaser is relying on these
representations and warranties in entering into this Agreement,
that:
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(a) the Company is a valid and subsisting corporation duly
incorporated and in good standing under the laws of Nevada;
(b) the Company is not a reporting issuer in British Columbia
and any Securities issued to the Purchaser will be subject
to an indefinite hold period in British Columbia unless an
exemption from the registration and prospectus requirements
of the Securities Act is available. Such an exemption may
not be available;
(c) the Company's subsidiaries (the "Subsidiaries"), if any,
are valid and subsisting corporations and in good standing
under the laws of the jurisdictions in which they were
incorporated;
(d) the common shares of the Company are eligible for quotation
on the N.A.S.D. OTC Bulletin Board ("OTC");
(e) upon their issuance, the Shares will be validly issued and
outstanding fully paid and non-assessable common shares of
the Company registered as directed by the Purchaser, free
and clear of all trade restrictions (except as may be
imposed by operation of the applicable Securities Rules)
and, except as may be created by the Purchaser, liens,
charges or encumbrances of any kind whatsoever;
(f) upon their issuance, the Warrants will be validly created,
issued and outstanding, registered as directed by the
Purchaser, and, upon their issuance, the shares issued on
the exercise of the Warrants will be validly issued and
outstanding fully paid and non-assessable common shares of
the Company registered as directed by the Purchaser, and
both will be free and clear of all trade restrictions
(except as may be imposed by operation of the applicable
Securities Rules) and, except as may be created by the
Purchaser, liens, charges or encumbrances of any kind
whatsoever;
(g) the Company and its Subsidiaries, if any, hold all licences
and permits that are required for carrying on their
business in the manner in which such business has been
carried on and the Company and its Subsidiaries, if any,
have the corporate power and capacity to own the assets
owned by them and to carry on the business carried on by
them and they are duly qualified to carry on business in
all jurisdictions in which they carry on business;
(h) all prospectuses, exchange offering prospectuses, offering
memoranda, filing statements, information circulars,
material change reports, shareholder communications, press
releases and other disclosure documents of the Company
including, but not limited to, financial statements,
contain no untrue statement of a material fact as at the
date thereof nor do they omit to state a material fact
which, at the date thereof, was required to have been
stated or was necessary to prevent a statement that was
made from being false or misleading in the circumstances in
which it was made;
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(i) to the best of its knowledge, and except as publicly
disclosed, there are no material actions, suits, judgments,
investigations or proceedings of any kind whatsoever
outstanding, pending or threatened against or affecting the
Company or its Subsidiaries, if any, at law or in equity or
before or by any Federal, Provincial, State, Municipal or
other governmental department, commission, board, bureau or
agency of any kind whatsoever and, to the best of the
Company's knowledge, there is no basis therefor;
(j) the Company has good and sufficient right and authority to
enter into this Agreement and complete its transactions
contemplated under this Agreement on the terms and
conditions set forth herein; and
(k) to the best of its knowledge, the execution and delivery of
this Agreement, the performance of its obligations under
this Agreement and the completion of its transactions
contemplated under this Agreement will not conflict with,
or result in the breach of or the acceleration of any
indebtedness under, or constitute default under, the
constating documents of the Company or any indenture,
mortgage, agreement, lease, licence or other instrument of
any kind whatsoever to which the Company is a party or by
which it is bound, or any judgment or order of any kind
whatsoever of any Court or administrative body of any kind
whatsoever by which it is bound.
2. Subscription
2.1 The Purchaser hereby subscribes the subscription funds (the
"Subscription Funds") referred to below for and agrees to take up
the units (a "Unit" or the "Units") referred to below, where each
Unit consists of one common share (a "Share" or the "Shares")
with a par value of U.S. $0.01 in the capital stock of the
Company and one-half of one non-transferable share purchase
warrant (a "Warrant" or the "Warrants"), at a price of U.S. $7.50
per Unit. Each whole Warrant (comprising two half warrants) will
entitle the Purchaser to subscribe for one additional common
share of the Company at a price of U.S. $7.50 per share at any
time up to 5:00 p.m. local time in Vancouver, B.C. on the first
anniversary of the Closing Date, and thereafter at a price of
U.S. $10.00 per share at any time up to 5:00 p.m. local time on
the second anniversary of the Closing Date. After two years the
Warrants will expire if not exercised.
2.2 On or before the 18 day of April, 2000, the Purchaser shall
deliver the Subscription Funds for the Securities subscribed for
in the form of solicitor's trust cheque, certified cheque, bank
draft, money order or wire transfer payable to "Xxxxxxx & Xxxxxx
In Trust" as the solicitors for and on behalf of the Company. The
Company will be entitled to use the Subscription Funds
immediately upon the issuance of the certificates representing
Securities to the Purchaser. The Purchaser hereby
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confirms that upon the Company advising Xxxxxxx & Xxxxxx that is
has delivered such certificates, or caused such certificates to
be delivered to, the Purchaser, Xxxxxxx & Xxxxxx is hereby
authorized and directed to release and deliver the Subscription
Funds to the Company without prior notice to, consent of or
action by the Purchaser.
3. Covenants, Agreements and Acknowledgements
3.1 The Purchaser covenants and agrees with the Company to:
(a) concurrent with the execution of this Agreement, if the
Purchaser is an individual (which means a natural person,
but does not include a partnership, unincorporated
association, unincorporated syndicate, unincorporated
organization or trust, or a natural person in his capacity
as a trustee, executor, administrator or personal or other
legal representative), fully complete and execute the Form
20A scheduled to this Agreement; and
(b) hold and not sell, transfer or in any manner dispose of the
Shares comprising the Units or any shares acquired on the
exercise of the Warrants comprising the Units unless the
sale, transfer or disposition is made in accordance with
all applicable Securities Rules.
3.2 The Purchaser acknowledges and agrees that the Shares comprising
the Units and any shares acquired on the exercise of the Warrants
comprising the Units will be subject to such trade restrictions
as may be imposed by operation of the applicable Securities
Rules, and the share certificate or certificates representing the
Shares comprising the Units and any shares acquired on the
exercise of the Warrants comprising the Units will bear such
legends as may be required by the applicable Securities Rules.
The Purchaser further acknowledges and agrees that it is the
Purchaser's obligation to comply with the trade restrictions in
all of the applicable jurisdictions and the Company offers no
advice as to those trade restrictions.
3.3 The Purchaser acknowledges that:
(a) the Securities have not been registered under the U.S.
Securities Act and are "restricted securities" within the
meaning of Rule 144 under the U.S. Securities Act and may
only be resold in accordance with the provisions of
Regulation S under the U.S. Securities Act, pursuant to
registration under the U.S. Securities Act, or pursuant to
an available exemption from such registration. The
Purchaser understands that the Company has no obligation or
present intention of filing a registration statement under
the U.S. Securities Act in respect of the Securities;
(b) hedging transactions involving the Securities may not be
conducted unless in compliance with the U.S. Securities
Act;
(c) there may be material tax consequences to the Purchaser of
an acquisition or disposition of Securities. The Company
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gives no opinion and makes no representation with respect
to the tax consequences to the Purchaser under United
States, state, local or foreign tax law of the Purchaser's
acquisition or disposition of such securities;
(d) the certificates evidencing the Securities issued in this
subscription will bear a legend in substantially the
following form:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"1933 ACT"). THE SHARES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY
NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF
AN EFFECTIVE REGISTRATION STATEMENT WITH RESPECT TO THE SHARES OR
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF SAID ACT THAT IS
THEN APPLICABLE TO THE SHARES, AS TO WHICH A PRIOR OPINION OF
COUNSEL MAY BE REQUIRED BY THE ISSUER OR THE TRANSFER AGENT."
(e) the Company is required to refuse to register any transfer
of the Securities not made in accordance with the
provisions of Regulation S under the U.S. Securities Act,
pursuant to registration under the U.S. Securities Act, or
pursuant to an available exemption from such registration;
and
(f) any person who exercises a Warrant will be required to
provide to the Company either:
(i) written certification that it is not a U.S. Person and that
such Warrant is not being exercised within the United
States or on behalf of, or for the account or benefit of, a
U.S. Person; or
(ii) a written opinion of counsel or other evidence satisfactory
to the Company to the effect that the Warrants and the
common shares issuable on the exercise of the Warrants have
been registered under the 1933 Act and applicable state
securities laws or are exempt from registration thereunder.
3.4 The Company covenants and agrees with the Purchaser to file the
documents necessary to be filed under the applicable Securities
Rules, including Forms 20 (or the forms equivalent thereto),
within the required time.
4. Closing
4.1 The completion of the subscription contemplated under this
Agreement shall occur on or before April 18, 2000 (the "Closing
Date"). The Company shall deliver to the Purchaser, no later than
the Closing Date, a share certificate or certificates
representing the Shares and a warrant certificate or certificates
representing the Warrants comprising the Units
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to the Purchaser as provided for below by the Purchaser. Upon the
Company advising Xxxxxxx & Xxxxxx that it has delivered these
documents, or caused them to be delivered, Xxxxxxx & Xxxxxx is
authorized and directed by the parties hereto to release and
deliver the Subscription Funds to the Company without prior
notice to, consent of or action by the Purchaser.
5. General
5.1 For the purposes of this Agreement, time is of the essence.
5.2 The parties hereto shall execute and deliver all such further
documents and instruments and do all such acts and things as may,
either before or after the execution of this Agreement, be
reasonably required to carry out the full intent and meaning of
this Agreement.
5.3 This Agreement shall be subject to, governed by and construed in
accordance with the laws of British Columbia.
5.4 This Agreement may not be assigned by either party hereto.
5.5 This Agreement may be signed by the parties 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.
XXXXX Aktiengesellschaft
Per: /s/
----------------------------------
Authorized Signatory
TO BE COMPLETED BY THE PURCHASER:
A. Name and Address (Note: Can not be a U.S. address) The name and
address (to establish the Purchaser's jurisdiction of residence
for the purpose of determining the applicable Securities Rules)
of the purchaser (the "Purchaser") is as follows:
Name Xxxxx XX
Street Address Xxxxxxxxxxx 00
Country FL 9490 VADUZ
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B. Registration Instructions (Note: Cannot be a U.S. Address) The
name and address of the person in whose name the Purchaser's
Securities are to be registered is as follows (if the name and
address is the same as was inserted in paragraph A above, then
insert "N/A"):
N/A
----------------------------------------
Name
----------------------------------------
Street Address
----------------------------------------
----------------------------------------
City and Province
----------------------------------------
Country
--------------
Postal Code
C. Delivery Instructions (Note: Cannot be a U.S. Address) The
name and address of the person to whom the certificates
representing the Purchaser's Securities referred to in
paragraph A above are to be delivered is as follows (if the
name and address is the same as was inserted in paragraph A
above, then insert "N/A"):
XXXXX XX
---------------------------------------
Name
Xxxxxxxxxxx 00, XX-0000 Xxxxx
---------------------------------------
Street Address
Lichenstein
----------------------------------------
City and Province
----------------------------------------
Country
162-9490
Postal Code
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D. Subscription Amount The minimum is Cdn. $97,000 if the
Purchaser is a resident (as per the address inserted in
paragraph A above) of British Columbia, Alberta, Manitoba. New
Brunswick, Xxxxxx Xxxxxx Island, Newfoundland or an
International Jurisdiction, or Cdn. $150,000 if the Purchaser
is a resident of Saskatchewan, Ontario, Quebec or Nova
Scotia.:
Subscription Funds: U.S. $3,000,000
Number of Securities: 400,000 Units.
Note: The number of Securities must equal the Subscription
Funds divided by price of U.S. $7.50 per Security.
TO BE COMPLETED AND SIGNED BY THE PURCHASER:
Xxxxx XX
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Name of the "Purchaser" - use the name inserted in
paragraph A above.
Per: XXXXX Aktiengesellschaft
/s/
----------------------
Signature of Purchaser
Title (if applicable)
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