PRIVATE PLACEMENT SUBSCRIPTION AGREEMENT
The
securities to which this agreement relate have not been registered under the
United States Securities Act of 1933, as amended, any U.S. state securities
laws, any applicable Canadian securities laws, or any securities laws of any
other jurisdiction and may not be offered or resold in the United States or
in
Canada without registration under such applicable U.S. or Canadian securities
laws, unless an exemption from registration is available and only upon the
holder thereof first having obtained the written opinion of counsel to the
Company, or other counsel acceptable to the Company, that the proposed
disposition is consistent with all applicable provisions of such Act as well
as
any other applicable securities law.
TO: AMERICAN
GOLDFIELDS INC. (the “Company”)
Re: Purchase
of securities of the Company
Details
of
Subscription: The
Subscriber (the “Subscriber”) hereby irrevocably subscribes for and agrees to
purchase from the Company, on the terms and conditions set forth herein and
in
the attached schedules, that number of units of the Company set out below at
a
price of $0.64 per unit. Each unit shall consist of one common share
of the Company (a “Share”) and two share purchase warrants (collectively, the
“Warrants”), each Warrant substantially in the form attached
hereto. Each Warrant shall entitle the Subscriber to purchase one
common share of the Company at the following prices:
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a.
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Class
A warrant – $0.70 per
share
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b.
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Class
B warrant – $0.74 per share
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The
Class
A are exercisable immediately and the Class B Warrants are not exercisable
until
February 6, 2008. The Warrants expire 5 years from the date the Warrants are
first exercisable. The Company reserves the right, in its sole and
absolute discretion, to reduce the exercise price of the warrants and/or to
accelerate the exercise date of the Warrants.
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Number
of Units to be purchased:
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Units
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Total
Subscription Price:
($0.64
per Unit)
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$
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Name
of Subscriber:
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Address:
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(Street
Address)
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(City
and Province)
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(Country
and Postal or Zip Code)
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(Contact
Name)
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(Contact’s
Telephone Number)
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(Contact’s
e-mail Address)
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1
N
WITNESS
WHEREOF the Subscriber has executed, or caused its duly authorized
representative to execute, this agreement as of December 6, 2007.
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Signature
of Subscriber (if an individual)
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Per:
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Name
of Subscriber (if not an individual)
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Name
of Subscriber (if an individual)
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(signature
of authorized representative)
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Name
and Title of Authorized
Representative
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ACCEPTANCE
The
foregoing is accepted and agreed to as of the 6th day of December,
2007.
By: ________________________
Name:
Xxxxxx Xxxx
Title: President
2
SCHEDULE
I
CONFIRMATION
OF RELATIONSHIP
(For
Directors, Senior Officers and Control Persons and
Their
Close Personal Friends, Close Business Associates and Relatives)
The
Subscriber represents and warrants to the Company that the Subscriber has read
the following definitions from Multilateral Instrument 00-000 Xxxxxxx
Raising Exemptions and certifies that the Subscriber has the
relationship(s) to the Company or its directors, senior officers or control
persons by virtue of the Subscriber being:
(initial
one or more as appropriate)
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_____
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(a)
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a
director, senior officer or control person of the Company, or of
an
affiliate of the Company;
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_____
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(b)
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a
spouse, parent, grandparent, brother, sister or child of a director,
senior officer or control person of the Company, or of an affiliate
of the
company;
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_____
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(c)
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a
close personal friend of a director, senior officer or control person
of
the Company, or of an affiliate of the
Company;
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_____
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(d)
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a
close business associate of a director, senior officer or control
person
of the Company, or of an affiliate of the
Company;
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_____
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(e)
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a
person or company that is wholly-owned by any combination of persons
or
companies described in paragraphs (a) to
(d),
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and
if (b), (c), (d) or (e) is initialed the director, senior officer
or
control person is:
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________________________________________
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(Print
name of director, senior officer or control
person)
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The
foregoing representations and warranties are true and accurate as of the date
of
this certificate and will be true and accurate as of Closing. If any
such representations and warranties shall not be true and accurate prior to
Closing, the Subscriber shall give immediate written notice of such fact to
the
Company.
For
the
purposes hereof, the following definitions are included for
convenience:
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a.
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“close
business associate” means an individual who has had sufficient prior
business dealings with the director, senior officer or control person
to
be in a position to assess the capabilities and trustworthiness of
the
director, senior officer or control
person.
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3
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A
casual business associate or a person introduced or solicited for
the
purpose of purchasing securities is not a close business
associate. An individual is not a close business associate
solely because the individual is a client or former client. For
example, an individual is not a close business associate of a registrant
or former registrant solely because the individual is a client or
former
client of that registrant or former
registrant.
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The
relationship between the purchaser and the director, senior officer or control
person must be direct. For example, the exemption is not available
for a close business associate of a close business associate or a director,
senior officer or control person.
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b.
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“close
personal friend” means an individual who has known the director, senior
officer or control person for a sufficient period of time to be in
a
position to assess the capabilities and trustworthiness of the director,
senior officer or control person.
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An
individual is not a close personal friend solely because
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·
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the
individual is a member of the same organization, association or religious
group, or
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·
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the
individual is a client or former
client.
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The
relationship between the purchaser and the director, senior officer or control
person must be direct. For example, the exemption is not available
for a close personal friend or a close personal friend of the director, senior
officer or control person.
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c.
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“company”
means any corporation, incorporated association, incorporated syndicate
or
other incorporated organization.
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d.
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“person”
means and individual, partnership, unincorporated association,
unincorporated syndicate, unincorporated organization, trust, trustee,
executor, administrator or other legal
representative.
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e.
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“spouse”
means,
in relation to an
individual, another individual to whom that individual is married,
or
another individual of the opposite sex or the same sex with whom
that
individual is living in a conjugal relationship outside
marriage.
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DATED
at
_______ on ______________________________.
___________________________________
Name
of Purchaser – please
print
___________________________________
Authorized
Signature
___________________________________
Official
Capacity – please
print
___________________________________
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Please
print name and individual whose signature appears above, if different
name
of purchaser printed above.
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4
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SCHEDULE
II
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ACCREDITED
INVESTOR CONFIRMATION
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(For
accredited investors resident in British Columbia or
Alberta)
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The
Subscriber represents and warrants to the Company that the Subscriber has read
the following definitions of an “accredited investor” from Multilateral
Instrument 00-000 Xxxxxxx Raising Exemptions and certifies that the
Subscriber is an accredited investor by virtue of falling into one or more
of
the categories indicated below (initial as appropriate):
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(a)
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a
Canadian financial institution, or an authorized foreign bank listed
in
Schedule III of the Bank Act
(Canada);
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_____
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(b)
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the
Business Development Bank of Canada incorporated under the Business
Development Bank of Canada Act
(Canada);
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_____
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(c)
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an
association under the Cooperative Credit Associations Act
(Canada) located in Canada;
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_____
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(d)
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a
subsidiary of any person or company referred to in paragraphs (a)
to (c),
if the person or company owns all of the voting securities of the
subsidiary, except the voting securities required by law to be owned
by
directors of that subsidiary;
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_____
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(e)
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a
person or company registered under the securities legislation of
British
Columbia or Alberta, or under the securities legislation of another
jurisdiction of Canada, as an adviser or dealer, other than a limited
market dealer registered under the Securities Act
(Ontario);
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_____
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(f)
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an
individual registered or formerly registered under the securities
legislation of British Columbia or Alberta, or under the securities
legislation of another jurisdiction of Canada, as a representative
of a
person or company referred to in paragraph
(e);
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_____
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(g)
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the
government of Canada or a province, or any crown corporation or agency
of
the government of Canada or a
province;
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_____
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(h)
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a
municipality, public board or commission in
Canada;
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_____
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(i)
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any
national, federal, state, provincial, territorial or municipal government
of or in any foreign jurisdiction, or any agency of that
government;
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_____
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(j)
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a
pension fund that is regulated by either the Office of the Superintendent
of Financial Institutions (Canada) or a provincial pension commission
or
similar regulatory authority;
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5
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_____
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(k)
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a
registered charity under the Income Tax Act
(Canada)
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_____
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(l)
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an
individual who, either alone or jointly with a spouse, beneficially
owns,
directly or indirectly, financial assets having an aggregate realizable
value that before taxes, but net of any related liabilities, exceeds
CDN$1,000,000;
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_____
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(m)
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an
individual whose net income before taxes exceeded CDN$200,000 in
each of
the two most recent years or whose net income before taxes combined
with
that of a spouse exceeded CDN$300,000 in each of the two most recent
years
and who, in either case, reasonably expects to exceed that net income
level in the current year;
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_____
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(n)
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a
corporation, limited partnership, limited liability partnership,
trust or
estate, other than a mutual fund or non-redeemable investment fund,
that
had net assets of at least CDN$ 5,000,000 as shown on its most recently
prepared financial statements;
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_____
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(o)
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a
mutual fund or non-redeemable investment fund that, in British Columbia
or
Alberta, distributes its securities only to persons or companies
that are
accredited investors;
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_____
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(p)
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a
mutual fund or non-redeemable investment fund that, in British Columbia
or
Alberta, distributes its securities under a prospectus for which
the
British Columbia or Alberta Securities Commission, as the case may
be, has
issued a receipt;
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_____
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(q)
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an
entity organized in a foreign jurisdiction that is analogous to any
of the
entities referred to in paragraphs (a) through (e) and paragraph
(j) in
form and function; or
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_____
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(r)
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a
person or company in respect of which all of the owners of interests,
direct or indirect, legal or beneficial, are persons or companies
that are
accredited investors.
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The
foregoing representations and warranties are true and accurate as of the date
of
this certificate and will be true and accurate as of Closing. If any
such representations and warranties shall not be true and accurate prior to
Closing, the Subscriber shall give immediate written notice of such fact to
the
Company.
For
the
purposes hereof, the following definitions are included for
convenience:
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a.
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“company”
means any corporation, incorporated association, incorporated syndicate
or
other incorporated
organization.
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6
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b.
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“entity”
means a company, syndicate, partnership, trust or incorporated
organization.
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c.
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“financial
assets” means cash and securities.
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d.
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“mutual
fund” indicates an issuer of securities that entitle the holder to receive
on demand, or within a specified period after demand, an amount computed
by reference to the value of a proportionate interest in the whole
or in a
part of the net assets, including a separate fund or trust account,
of the
issuer of securities.
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e.
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“non-redeemable
investment fund” means an issuer:
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i.
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whose
primary purpose is to invest money provided by its security
holders;
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ii.
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that
does not invest for the purpose of exercising effective control,
seeking
to exercise effective control, or being actively involved in the
management of the issuers in which it invests, other than other mutual
funds or non-redeemable investment funds;
and
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iii.
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that
is not a mutual fund.
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f.
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“person”
means an individual, partnership, unincorporated association,
unincorporated syndicate, unincorporated organization, trust, trustee,
executor, administrator or other legal
representative.
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g.
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“related
liabilities” means liabilities incurred or assumed for the purpose of
financing the acquisition or ownership of financial assets and liabilities
that are secured by financial
assets.
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h.
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“spouse”
means, in relation to an individual, another individual to whom that
individual is married, or another individual or the opposite sex
or the
same sex with whom that individual is living in a conjugal relationship
outside of marriage.
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In
Multilateral Instrument 45-103 a person or company is considered to
be:
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an
“affiliated entity” of another person or company if one is a subsidiary
entity of the other, or if both are subsidiary entities of the same
person
of company, or if each of them is controlled by the same person or
company.
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·
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“controlled”
by a person or company if,
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a.
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in
the case of a person or company,
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i.
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voting
securities of the first-mentioned person or company carrying more
than 50%
of the votes for the election of directors are held, otherwise than
by way
of securities only, by or for the benefit of the other person or
company;
and
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7
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ii.
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the
votes carried by the securities are entitled, if exercised, to elect
a
majority of the directors of the first-mentioned person or
company;
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b.
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in
the case of a partnership that does not have directors, other than
a
limited partnership, the second-mentioned person or company holds
more
than 50% of the interests in the partnership;
or
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c.
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in
the case of a limited partnership, the general partner is the
second-mentioned person or company.
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·
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a
“subsidiary entity” of another person or company
if:
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a.
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it
is controlled by,
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i.
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that
other, or
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ii.
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that
other and one or more persons or companies each of which’s controlled by
that other, or
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iii.
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two
or more persons or companies, each of which is controlled by that,
or
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b.
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it
is a subsidiary entity of a person or company that is the other’s
subsidiary entity.
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DATED
at _________ on ______, 2007.
___________________________________
Name
of Purchaser – please
print
___________________________________
Authorized
Signature
___________________________________
Official
Capacity – please
print
___________________________________
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Please
print name and individual whose signature appears above, if different
name
of purchaser printed above.
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8
DETAILS
AND CONDITIONS OF THE SUBSCRIPTION
1. Description
of Securities
The
securities subscribed for hereunder shall be units, each unit consisting of
one
(1) share of common stock of the Company (collectively, the “Shares”) and two
(2) common share purchase warrants (collectively, the
“Warrants”). Each Warrant shall entitle the holder thereof to
purchase one share of common stock of the Company (collectively, the “Warrant
Shares”), during the period and for the prices described on the first page of
this Private Placement Subscription Agreement (this “Agreement”) and as more
further specified in the attached forms of the Warrant
Agreements. The foregoing description of the Warrants is a summary
only and is subject to the detailed provisions of the Warrant
Agreements. The Shares and Warrants are herein collectively referred
to as the “Units”. The Units, Shares, Warrants and Warrant Shares are
herein collectively referred to as the “Securities”.
The
Securities will be subject to statutory hold periods during which they may
not
be transferred or resold. Subscribers are advised to consult their
own legal advisers in connection with any applicable resale
restrictions.
2. Payment
of Subscription Price
The
total
Subscription Price set out on the first page of this Agreement must be paid
by
money order, certified check or bank draft payable to the Company prior to
the
Closing Date.
3. Documents
Required
The
Subscriber must complete, sign and deliver to the company and executed copy
of
this Agreement together with the attached applicable Schedules:
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a.
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Schedule
I, a Confirmation of Relationship, if the Subscriber is a director,
senior
officers or control person of the Company or a close personal friend,
close business associate, spouse, parent, grandparent, sibling or
child of
a director, senior officer or control person of the
Company.
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b.
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Schedule
II, a British Columbia or Alberta Accredited Investor Confirmation,
if the
Subscriber is an accredited investor resident in British Columbia
or
Alberta.
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The
Subscriber shall complete, sign and deliver to the Company as soon as possible
such further documents, questionnaires, notices and undertakings as may be
required by regulatory authorities, stock exchanges and applicable
law.
9
4. Closing
Delivery
and payment for the Units (the “Closing) will be completed at the offices of
American Goldfields Inc., 000-0000
Xxxxx
Xxxxx Xxxxx, Xxxxxxx, X.X., Xxxxxx X0X 0X0.
Upon
receipt by the Company of an executed Agreement and payment for an aggregate
of
_______ Units, certificates representing the Shares and Warrants will be
available for delivery five business days after the Closing.
5. Acknowledgements
by All Subscribers
The
Subscriber, irrespective of their jurisdiction of residency, acknowledges
that:
(a) The
Subscriber is acquiring the Securities for his own account as principal, not
as
a nominee or agent, for investment purposes only, and not with a view to, or
for, resale, distribution or fractionalization thereof in whole or in part
and
no other person has a direct or indirect beneficial interest in such Securities
or any portion thereof. Further, the Subscriber does not have any
contract, undertaking, agreement or arrangement with any person to sell,
transfer or grant participations to such person or to any third person, with
respect to the Securities for which the Subscriber is subscribing or any part
of
the Securities.
(b) The
Subscriber has full power and authority to enter into this Agreement, the
execution and delivery of this Agreement has been duly authorized, if
applicable, and this Agreement constitutes a valid and legally binding
obligation of the Subscriber.
(c) The
Subscriber is not subscribing for the Securities as a result of or subsequent
to
any advertisement, article, notice or other communication published in any
newspaper, magazine or similar media or broadcast over television or radio,
or
presented at any seminar or meeting, or any solicitation of a subscription
by
person previously not known to the Subscriber in connection with investment
securities generally.
(d) The
Subscriber understands that the Company is under no obligation to register
the
Securities under the Securities Act, or to assist the Subscriber in complying
with the Securities Act or the securities laws of any state of the United States
or of any foreign jurisdiction.
(e) The
Subscriber is (i) experienced in making investments of the kind described in
this Agreement and the related documents, (ii) able, by reason of the business
and financial experience of its officers (if an entity) and professional
advisors (who are not affiliated with or compensated in any way by the Company
or any of its affiliates or selling agents), to protect its own interests in
connection with the transactions described in this Agreement, and the related
documents, and (iii) able to afford the entire loss of its investment in the
Securities.
10
(f) The
Subscriber acknowledges his understanding that the offering and sale of the
Securities is intended to be exempt from registration under the Securities
Act. In furtherance thereof, in addition to the other representations
and warranties of the Subscriber made herein, the Subscriber further represents
and warrants to and agrees with the Company and its affiliates as
follows:
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(i)
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The
Subscriber realizes that the basis for the exemption may not be present
if, notwithstanding such representations, the Subscriber has in mind
merely acquiring the Securities for a fixed or determinable period
in the
future, or for a market rise, or for sale if the market does not
rise. The Subscriber does not have any such
intention;
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(ii)
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The
Subscriber has the financial ability to bear the economic risk of
his
investment, has adequate means for providing for his current needs
and
personal contingencies and has no need for liquidity with respect
to his
investment in the Company; and
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(iii)
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The
Subscriber has such knowledge and experience in financial and business
matters as to be capable of evaluating the merits and risks of the
prospective investment in the Securities. The Subscriber also
represents it has not been organized for the purpose of acquiring
the
Securities; and
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(iv)
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The
Subscriber has been provided an opportunity for a reasonable period
of
time prior to the date hereof to obtain additional information concerning
the offering of the Securities, the Company and all other information
to
the extent the Company possesses such information or can acquire
it
without unreasonable effort or
expense.
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(v)
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The
Subscriber has carefully reviewed all of the Company’s filings under the
Securities Exchange Act of 1934, as amended (the “Exchange
Act”).
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(g) The
Subscriber is not relying on the Company, or its affiliates or agents with
respect to economic considerations involved in this investment. The
Subscriber has relied solely on its own advisors.
(h) No
representations or warranties have been made to the Subscriber by the Company,
or any officer, employee, agent, affiliate or subsidiary of the Company, other
than the representations of the Company contained herein, and in subscribing
for
Securities the Subscriber is not relying upon any representations other than
those contained herein.
11
(i) Any
resale of the Securities during the ‘distribution compliance period’ as defined
in Rule 902(f) to Regulation S shall only be made in compliance with exemptions
from registration afforded by Regulation S. Further, any such sale of
the Securities in any jurisdiction outside of the United States will be made
in
compliance with the securities laws of such jurisdiction. The
Investor will not offer to sell or sell the Securities in any jurisdiction
unless the Investor obtains all required consents, if any.
(j) The
Subscriber understands that the Securities are being offered and sold to him
in
reliance on an exemption from the registration requirements of United States
federal and state securities laws under Regulation S promulgated under the
Securities Act and that the Company is relying upon the truth and accuracy
of
the representations, warranties, agreements, acknowledgments and understandings
of the Investor set forth herein in order to determine the applicability of
such
exemptions and the suitability of the Investor to acquire the
Securities. In this regard, the Subscriber represents, warrants and
agrees that:
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1.
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The
Subscriber is not a U.S. Person (as defined below) and is not an
affiliate
(as defined in Rule 501(b) under the Securities Act) of the Company
and is
not acquiring the Securities for the account or benefit of a U.S.
Person. A U.S. Person means any one of the
following:
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·
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any
natural person resident in the United States of
America;
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·
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any
partnership or corporation organized or incorporated under the laws
of the
United States of
America;
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·
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any
estate of which any executor or administrator is a U.S.
person;
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·
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any
trust of which any trustee is a U.S.
person;
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·
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any
agency or branch of a foreign entity located in the United States
of
America;
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·
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any
non-discretionary account or similar account (other than an estate
or
trust) held by a dealer or other fiduciary for the benefit or account
of a
U.S. person;
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·
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any
discretionary account or similar account (other than an estate or
trust)
held by a dealer or other fiduciary organized, incorporated or (if
an
individual) resident in the United States of America;
and
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·
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any
partnership or corporation
if:
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12
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(A)
organized or incorporated under the laws of any foreign jurisdiction;
and
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(B)
formed by a U.S. person principally for the purpose of investing in securities
not registered under the Securities Act, unless it is organized or incorporated,
and owned, by accredited investors (as defined in Rule 501(a)
under the Securities Act) who are not natural persons, estates or
trusts.
13
2. At
the time of the origination of contact concerning this Agreement and the date
of
the execution and delivery of this Agreement, the Subscriber was outside of
the
United States.
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3.
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The
Subscriber will not, during the period commencing on the date of
issuance
of the Securities and ending on the first anniversary of such date,
or
such shorter period as may be permitted by Regulation S or other
applicable securities law (the “Restricted Period”), offer, sell, pledge
or otherwise transfer the Securities in the United States, or to
a U.S.
Person for the account or for the benefit of a U.S. Person, or otherwise
in a manner that is not in compliance with Regulation
S.
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4.
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The
Subscriber will, after expiration of the Restricted Period, offer,
sell,
pledge or otherwise transfer the Securities only pursuant to registration
under the Securities Act or an available exemption therefrom and,
in
accordance with all applicable state and foreign securities
laws.
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5.
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The
Subscriber was not in the United States, engaged in, and prior to
the
expiration of the Restricted Period will not engage in, any short
selling
of or any hedging transaction with respect to the Securities, including
without limitation, any put, call or other option transaction, option
writing or equity swap.
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6.
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Neither
the Subscriber nor or any person acting on his behalf has engaged,
nor
will engage, in any directed selling efforts to a U.S. Person with
respect
to the Securities and the Investor and any person acting on his behalf
have complied and will comply with the “offering restrictions”
requirements of Regulation S under the Securities
Act.
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7.
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The
transactions contemplated by this Agreement have not been pre-arranged
with a buyer located in the United States or with a U.S. Person,
and are
not part of a plan or scheme to evade the registration requirements
of the
Securities Act.
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8.
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Neither
the Subscriber nor any person acting on his behalf has undertaken
or
carried out any activity for the purpose of, or that could reasonably
be
expected to have the effect of, conditioning the market in the United
States, its territories or possessions, for any of the
Securities. The Subscriber agrees not to cause any
advertisement of the Securities to be published in any newspaper
or
periodical or posted in any public place and not to issue any circular
relating to the Securities, except such advertisements that include
the
statements required by Regulation S under the Securities Act, and
only
offshore and
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not
in the U.S. or its territories, and only in compliance with any local
applicable securities laws.
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9.
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Each
certificate representing the Securities shall be endorsed with the
following legends, in addition to any other legend required to be
placed
thereon by applicable federal or state securities
laws:
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(A) “THE
SHARES ARE BEING OFFERED TO INVESTORS WHO ARE NOT U.S. PERSONS (AS DEFINED
IN
REGULATION S UNDER THE SECURITIES ACT OF 1933, AS AMENDED (“THE SECURITIES
ACT”)) AND WITHOUT REGISTRATION WITH THE UNITED STATES SECURITIES AND EXCHANGE
COMMISSION UNDER THE SECURITIES ACT IN RELIANCE UPON REGULATION S PROMULGATED
UNDER THE SECURITIES ACT.”
(B) “TRANSFER
OF THESE SHARES IS PROHIBITED, EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF
REGULATION S, PURSUANT TO REGISTRATION UNDER THE SECURITIES ACT, OR PURSUANT
TO
AVAILABLE EXEMPTION FROM REGISTRATION. HEDGING TRANSACTIONS MAY NOT
BE CONDUCTED UNLESS IN COMPLIANCE WITH THE SECURITIES ACT.”
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10.
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The
Subscriber consents to the Company making a notation on its records
or
giving instructions to any transfer agent of the Company in order
to
implement the restrictions on transfer of the Securities set forth
herein.
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(k) The
Subscriber is an “accredited investor” as that term is defined within the
meaning of Rule 501 ” as that term is defined in Rule 501 of the General Rules
and Regulations under the Securities Act by reason of Rule
501(a)(3).
(l) The
Subscriber understands that an investment in the Securities is a speculative
investment which involves a high degree of risk and the potential loss of his
entire investment.
(m) The
Subscriber's overall commitment to investments which are not readily marketable
is not disproportionate to the Subscriber's net worth, and an investment in
the
Securities will not cause such overall commitment to become
excessive.
(n) The
Subscriber has received all documents, records, books and other information
pertaining to the Subscriber’s investment in the Company that has
been
15
requested
by the Subscriber. The Subscriber has reviewed or received copies of
all reports and other documents filed by the Company with the Securities and
Exchange Commission, including without limitation, the Company’s Form 10-KSB and
most recently filed Form 10-QSB (the “SEC Documents”).
(o) The
Subscriber represents and warrants to the Company that all information that
the
Subscriber has provided to the Company is correct and complete as of the date
hereof.
(p) Other
than as set forth herein, the Subscriber is not relying upon any other
information, representation or warranty by the Company or any officer, director,
stockholder, agent or representative of the Company in determining to invest
in
the Securities. The Subscriber has consulted, to the extent deemed
appropriate by the Subscriber, with the Subscriber’s own advisers as to the
financial, tax, legal and related matters concerning an investment in the
Securities and on that basis believes that his or its investment in the
Securities is suitable and appropriate for the Subscriber.
(q) The
Subscriber is aware that no federal or state agency has (i) made any finding
or
determination as to the fairness of this investment, (ii) made any
recommendation or endorsement of the Securities or the Company, or (iii)
guaranteed or insured any investment in the Securities or any investment made
by
the Company.
(p) The
Subscriber understands that the price of the Securities offered hereby bear
no
relation to the assets, book value or net worth of the Company and were
determined arbitrarily by the Company. The Subscriber further
understands that there is a substantial risk of further dilution on his or
its
investment in the Company.
(q) The
Company has advised the Subscriber that the Company is relying on exemptions
from the requirements to provide the Subscriber with a prospectus and to sell
securities through a person registered to sell securities under the
Securities Act (British Columbia) (together with the rules, policies,
instruments and orders thereunder, the “BC Act”), and regulations of the 1933
Act (together with the rules, policies, instruments and orders thereunder,
the
“US Securities Act”), as the case may be, and, as a consequence of acquiring
securities pursuant to these exemptions, certain protections, rights and
remedies provided by the BC Act and US Securities Act, including statutory
rights of rescission or damages, will not be available to the
Subscriber.
(r) The
Subscriber is aware that the Securities will be offered and sold pursuant to
certain exemptions under the BC Act, U.S. Securities Act and other applicable
securities legislation and the Subscriber is not acquiring the Securities as
a
result of any information about the affairs of the Company that is not generally
known to the public save knowledge of this particular transaction.
(s) This
subscription by the Subscriber has not been induced by any representations
or
warranties by any person whatsoever with regard to the future value of the
Securities.
16
The
foregoing representations, warranties and covenants are made by the Subscriber
with the intent that they be relied upon by the Company in determining its
suitability as a purchaser of the Securities and the Subscriber hereby agrees
to
indemnify the Company against all losses, claims, costs, expenses and damages
or
liabilities which it may suffer or incur as a result of reliance
thereon. The Subscriber undertakes to notify the Company immediately
of any change in any representation, warranty or other information relating
to
the Subscriber set forth herein.
7. Representations
and Warranties of the Company
The
Company represents and warrants to the Subscriber that, as of the date of this
Agreement:
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a.
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The
Company is a valid and subsisting corporation duly
incorporated, continued or amalgamated and in good standing under
the laws
of the State of Nevada;
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b.
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The
Company has complied and will comply with all applicable corporate
and
securities laws and regulations in connection with the offer, sale
and
issuance of the Securities;
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c.
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The
filings made by the Company with the Securities and Exchange Commission
(the “SEC Documents”) and the representations contained in this Agreement
are accurate in all material respects and omit no fact, the omission
of
which would make such representations misleading in light of the
circumstances in which such representation was
made;
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d.
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The
issuance and sale of the Securities by the Company does not and will
not
conflict with and does not and will not result in a breach of any
of the
terms, conditions or provisions of its constituent documents or any
agreement or instrument to which the Company is a
party;
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e.
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The
Agreement has been duly authorized by all necessary corporate action
on
the part of the Company and, subject to acceptance by the Company,
constitutes a valid obligation of the Company legally binding upon
it and
enforceable in accordance with its
terms;
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f.
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The
issuance of the Shares and Warrants, at the time of their issue,
will have
been approved by all requisite corporate action and, upon issue and
delivery, will be validly issued, fully paid and non-assessable.
The
Warrant Shares to be issued upon the due exercise of the Warrants
are
reserved for issuance and, upon exercise of the Warrants in accordance
with its terms, will be validly issued, fully paid and
non-assessable;
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17
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g.
|
The
Company is not a party to any actions, suits or proceedings which
could
materially affect its business or financial condition, and, as at
the date
hereof, no such actions, suits or proceedings have been threatened
or, to
the best of the Company’s knowledge, are pending, except as disclosed in
the SEC Documents; and
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h.
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No
other ceasing or suspending trading in the Securities nor prohibiting
sale
of the Securities has been issued to and is outstanding against the
Company or its directors, officers or promoters and to the best of
the
Company’s knowledge no investigations of proceedings for such purposes are
pending or threatened.
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8. Legending
of Securities
The
Subscriber hereby acknowledges that legends will be placed upon the certificates
representing the Securities to the effect that the securities represented
thereby are subject to hold periods and may not be traded until the expiry
thereof except as permitted under applicable securities rules and
regulations.
18
9. Costs
The
Subscriber acknowledges and agrees that all costs and expenses incurred by
the
Subscriber (including any fees and disbursements of any special counsel retained
by the Subscriber) relating to the acquisition of the Securities shall be borne
by the Subscriber.
10. Governing
Law
This
Agreement is governed by the laws of the State of Nevada, the federal laws
of
the United States and the province of British Columbia and the federal laws
of
Canada applicable herein. The Subscriber, in its personal or
corporate capacity and, if applicable, on behalf of each beneficial purchaser
for whom it is acting, irrevocably attorn to the jurisdiction of the courts
of
the province of British Columbia or the State of Nevada, as determined in the
sole discretion of the Company.
11. Survival
This
Agreement including, without limitation, the representations, warranties and
covenants contained herein, shall survive and continue in full force and effect
and be binding upon the parties notwithstanding the completion of the purchase
of the Units by the Subscriber and any subsequent disposition by the Subscriber
or the Securities.
12. Assignment
This
Agreement is not transferable or assignable.
13. Execution
The
Company shall be entitled to rely on delivery by facsimile machine of an
executed copy of this Agreement and acceptance by the Company of such facsimile
copy shall be equally effective to create a valid and binding agreement between
the Subscriber and the Company in accordance with the terms hereof. This
Agreement may be executed through the use of separate signature pages or in
any
number of counterparts, and each of such counterparts shall, for all purposes,
constitute one agreement binding on all parties, notwithstanding that all
parties are not signatories to the same counterpart.
14. Severability
The
invalidity or unenforceability of any particular provision of this Agreement
shall not affect or limit the validity or enforceability of the remaining
provisions of the Agreement.
15. Entire
Agreement
19
Except
as
expressly provided in this Agreement and in the agreements, instruments and
other documents contemplated or provided for herein, this Agreement contains
the
entire agreement between the parties with respect to the sale of the Units
and
there are no other terms, conditions, representations or warranties, whether
expressed, implied, oral or written, by statute, by common law, by the Company,
by the Subscriber, or by any third party.
16. Notice
Unless
otherwise provided herein, any notice or other communication to a party under
this Agreement may be made, given or served by registered mail, postage
pre-paid, by telecopy or by delivery to the parties at the addresses as set
out
in this Agreement. Any notice or other communication:
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a.
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Mailed
shall be deemed to have been received on the fifth business day following
its mailing;
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b.
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Telecopied
shall be deemed to have been received on the business day following
the
date of transmission; and
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c.
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Delivered
shall be deemed to have been received on the date of
delivery.
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In
the
event of a postal strike or delay affecting mail delivery, the date of receipt
of any notice by mail is deemed to be extended by the length of such strike
or
delay. Each party may change its address for service at any time by
providing notice in writing of such change to the other party.
17. Binding
Effect
This
Agreement shall be binding upon and inure to the benefit of the parties and
their heirs, executors, administrators, successors, legal representatives and
assigns. If the Subscriber is more than one person, the obligation of
the Subscriber 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 heirs, executors, administrators
and successors.
19. Further
Assurances
The
Subscriber agrees that he shall, from time to time after the Closing, upon
the
request of the Company, duly execute, acknowledge and deliver, or cause to
be
executed, acknowledged and delivered, all such further documents and instruments
and take such other actions, as may be requested by the Company.
20. Pronouns.
20
The
use
herein of the masculine pronouns "him" or "his" or similar terms shall be deemed
to include the feminine and neuter genders as well and the use herein of the
singular pronoun shall be deemed to include the plural as well.
[Remainder
of Page Intentionally Omitted; Signature Pages to Follow]
21
ACCEPTANCE
The
foregoing details and conditions are accepted and agreed to as of the __th
day
of ________, 2007.
___________________________________
Name
of Purchaser – please
print
___________________________________
Authorized
Signature
___________________________________
Official
Capacity – please
print
___________________________________
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Please
print name and individual whose signature appears above, if different
name
of purchaser printed above.
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