EXHIBIT 10.37
NORD RESOURCES CORPORATION
SUBSCRIPTION AGREEMENT
(ACCREDITED INVESTORS - RULE 506 OF REGULATION D
UNDER THE SECURITIES ACT OF 1933, AS AMENDED)
(FOR CANADIAN INVESTORS)
THIS SUBSCRIPTION AGREEMENT (this "Agreement") has been entered into, as of the
date of acceptance set forth at the end of this Agreement, between Nord
Resources Corporation (the "Company") and the undersigned (hereinafter, the
"Purchaser"). By the Purchaser's execution hereof, Purchaser acknowledges that
the Company is relying upon the accuracy of the representations and warranties
of the Purchaser contained herein.
GENERAL
1. This Agreement sets forth the terms under which Purchaser will invest in the
Company.
This subscription is one of a number of subscriptions for up to 1,428,571 Units
(defined below) offered on behalf of the Company in a private placement (the
"Offering"). Execution of this Agreement by the Purchaser shall constitute an
offer by the Purchaser to subscribe for Units, in the number, and on the terms
and conditions, specified herein. If the Purchaser's offer is accepted, the
Company will execute a copy of this Agreement and return it to the Purchaser.
The Purchaser's offer must be unconditional. The Purchaser may not condition the
acceptability of its offer upon any matter.
The Purchaser must sign and return together with a copy of this Agreement:
(a) the Canadian Investor Certificate attached as Appendix A to this
Agreement (the "Canadian Certificate"); and
(b) the Certification of U.S. Purchaser attached as Appendix B to this
Agreement (the "U.S. Certificate").
DEFINITION OF "UNIT"
2. Each "Unit" shall consist of one share of Common Stock of the Company, par
value $0.01 per share (a "Common Share") and one Common Share Purchase Warrant
(a "Purchase Warrant"), each Purchase Warrant entitling the holder thereof for
three years from the Closing (as hereinafter defined) to purchase one Common
Share (a "Warrant Share") upon payment of $0.40. (All references herein to
monetary units refer to U.S. dollars.)
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SUBSCRIPTION AMOUNT AND PAYMENT
3. Purchaser hereby subscribes for ______________________ Units (at $0.35 per
Unit), and submits to the Company herewith $________________________ in full
payment for such Units.
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
4. The Company hereby represents and warrants to the Purchaser, that it:
(a) is duly incorporated under the laws of the State of Delaware with
corporate power and authority to own, lease and operate its properties and
to conduct its business as now conducted by it;
(b) is qualified to carry on business under the laws of the jurisdiction in
which it presently carries on business;
(c) has full corporate power and capacity to create and issue the Common
Shares and Purchase Warrants, and to issue the Warrant Shares upon the
exercise of the Purchase Warrants in accordance with their terms;
(d) has duly authorized this Agreement, and this Agreement constitutes a
valid obligation of the Company duly binding upon it and enforceable in
accordance with its terms except as such enforceability may be subject to
(1) bankruptcy, insolvency, moratorium, or other similar laws affecting the
enforcement of creditors' rights generally, and (2) general equitable
principles;
(e) has authorized capital consisting of 50,000,000 Common Shares, par
value $0.01 per share, of which there are, as at September 30, 2005,
28,519,240 Common Shares outstanding as fully paid and non-assessable,
together with options to purchase an additional 4,036,499 Common Shares and
warrants to purchase an additional 1,700,000 Common Shares; and
(f) has not, in connection with the Offering of Units, engaged in any
general solicitation or general advertising (as those terms are used in
Regulation D under the United States Securities Act of 1933, as amended
(the "U.S. Securities Act"), including advertisements, articles, notices or
other communications published in any newspaper, magazine or similar media
or broadcast over radio or television, or any seminar or meeting whose
attendees have been invited by general solicitation or general advertising.
COVENANTS
5. Forthwith after the Closing the Company shall file such forms and documents
as may be required under applicable federal, state and provincial securities
laws.
REPRESENTATIONS, WARRANTIES AND ACKNOWLEDGEMENTS OF THE PURCHASER
6. The Purchaser hereby represents and warrants to the Company that:
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(a) the Purchaser has the power and the capacity to enter into this
Agreement, and, if the Purchaser is not an individual, the Purchaser:
(i) has been duly formed and is in good standing of the laws of its
governing jurisdiction;
(ii) has obtained all necessary authorizations and consents required
under its governing law and constating documents; and
(iii) has not been formed for the purpose of acquiring the Units;
(b) upon acceptance by the Corporation, this Agreement will constitute a
valid obligation of the Purchaser duly binding upon the Purchaser and
enforceable in accordance with its terms except as such enforceability may
be subject to (1) bankruptcy, insolvency, moratorium, or other similar laws
affecting the enforcement of creditors' rights generally, and (2) general
equitable principles;
(c) the Purchaser is an "accredited investor" as defined in section 1.1 of
National Instrument 45-106 as adopted by the Securities Commissions of
British Columbia and Ontario, and the Purchaser is also an "accredited
investor" as defined in Rule 501(a) of Regulation D under the U.S.
Securities Act (collectively, an "Accredited Investor");
(d) the Purchaser is acquiring the Common Shares and Purchase Warrants for
its own account as principal, or for the account of an Accredited Investor
as to which it exercises sole investment discretion, and not with a view to
any resale, distribution or other disposition of such securities;
(e) the Purchaser is not an underwriter, dealer or other person who intends
to participate in the distribution of the Common Shares, Purchase Warrants
or any Warrant Shares;
(f) the Purchaser has sufficient knowledge and experience in financial and
business matters to be capable of evaluating the risks and merits of an
investment in the Company; and
(g) the statements and information provided by the Purchaser in this
Agreement, the Canadian Certificate and the U.S. Certificate, and otherwise
communicated by the Purchaser to the Company, are complete and accurate in
all respects.
THE FOREGOING REPRESENTATIONS AND WARRANTIES ARE TRUE AND ACCURATE AS OF THE
DATE HEREOF AND SHALL SURVIVE THE DELIVERY OF THIS AGREEMENT BY THE PURCHASER.
PURCHASER AGREES TO NOTIFY THE COMPANY PROMPTLY OF ANY CHANGES TO ANY OF THE
FOREGOING.
7. The Purchaser hereby acknowledges and agrees that:
(a) the Common Shares and Purchase Warrants, and any Warrant Shares
issuable upon exercise of the Purchase Warrants, have not been and will not
be registered under
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the U.S. Securities Act, and that the sale contemplated hereby is being
made in reliance on a private placement exemption to Accredited Investors;
(b) the Purchaser has had the opportunity to ask questions of, and receive
answers from, the management of the Company concerning the terms of the
investment in the Common Shares and Purchase Warrants contemplated by this
Agreement and concerning any additional information regarding the Company;
(c) except as set forth in this Agreement, no representations or warranties
have been made to the Purchaser by the Company, or by any of its officers,
directors or any agent, employee or affiliate of any of them;
(d) in entering into this Agreement the Purchaser is not relying upon any
information, other than this Agreement, and the discussions described in
subsection 7(b) of this Agreement;
(e) there can be no guarantee of profit to be realized, if any, as a result
of an investment in the Company;
(f) the Common Shares, the Purchase Warrants and any Warrant Shares that
may be acquired upon exercise of the Purchase Warrants, are speculative
investments which involve a high degree of risk;
(g) if it decides to offer, sell or otherwise transfer any of the Common
Shares, Purchase Warrants or any Warrant Shares that may be acquired upon
exercise of the Purchase Warrants, it will not offer, sell or otherwise
transfer any of such securities directly or indirectly unless:
(i) the sale is to an accredited investor within the meaning ascribed
in Rule 501(a) of Regulation D under the U.S. Securities Act in
compliance with all applicable local laws and regulations, and a
purchaser's letter containing representations, warranties and
agreements substantially similar to those contained in this Agreement
and satisfactory to the Company, is executed by the purchaser and
delivered to the Company prior to the sale; or
(ii) the sale is made outside the United States in compliance with the
requirements of Rules 904 and 905 of Regulation S under the U.S.
Securities Act ("Regulation S") and in compliance with all applicable
local laws and regulations; or
(iii) the sale is made pursuant to an exemption from registration
under the U.S. Securities Act provided by Rule 144 thereunder, if
available; or
(iv) the Units are sold in a transaction that does not otherwise
require registration under the U.S. Securities Act or any applicable
United States state laws and regulations governing the offer and sale
of securities;
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and it has furnished to the Company an opinion of counsel of recognized
standing in the relevant jurisdictions reasonably satisfactory to the
Company;
(h) resale transactions effected pursuant to Rule 144 under the U.S.
Securities Act are subject to numerous technical requirements, including
the requirement under Rule 144(c) that adequate current public information
about the Company be available at the time of the resale transaction, but:
(i) the Company is presently not in compliance with its reporting
obligations under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"); and
(ii) the Purchaser will be precluded from relying on Rule 144(b) to
resell Common Shares, Purchase Warrants and any Warrant Shares that
may be issued upon exercise of the Purchase Warrants until such time
that the Company shall have filed all reports that are required to be
filed by it under section 13 of the Exchange Act for a period of 12
months;
(i) until such time as is no longer required under the U.S. Securities Act
or applicable state laws, all certificates representing the Common Shares,
Purchase Warrants and any Warrant Shares issued upon exercise of the
Purchase Warrants, and all certificates issued in exchange therefor or in
substitution thereof, shall bear, on the face of such certificates, a
legend substantially similar to the following:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE RESTRICTED
SECURITIES AS THAT TERM IS DEFINED IN RULE 144 UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "ACT"), AND HAVE NOT BEEN REGISTERED
UNDER THE ACT. THESE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD OR
TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE ACT OR PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE
ACT, THE AVAILABILITY OF WHICH IS TO BE ESTABLISHED TO THE
SATISFACTION OF THE ISSUER. THE ISSUER MAY REQUIRE AN OPINION OF
COUNSEL SKILLED IN SECURITIES MATTERS AND OTHER EVIDENCE OF COMPLIANCE
WITH THE ACT PRIOR TO PERMITTING A TRANSFER OF THESE SECURITIES.
(j) The Common Shares, Purchase Warrants and any Warrant Shares issued upon
exercise of the Purchase Warrants, will continue to be deemed to be
"restricted securities" (within the meaning assigned in Rule 144 under the
U.S. Securities Act) pursuant to Rule 905 of Regulation S, even if they are
resold pursuant to Rule 904 of Regulation S, which could restrict the
ability of the Purchaser to resell such securities over the facilities of
any "designated offshore securities market" (as defined in Rule 902 of
Regulation S) on which the securities may then be listed;
(k) under National Instrument 45-102, any Common Shares and Purchase
Warrants issued to residents of British Columbia or Ontario, and any
Warrant Shares purchased by residents of British Columbia or Ontario upon
exercise of Purchase Warrants, generally will be subject to restrictions on
resale until that date that is four months and a day after the later of:
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(i) the date of issuance of the Units; and
(ii) the date that the Company becomes a reporting issuer under the
securities legislation of any province or territory of Canada;
(l) the Company is currently not a reporting issuer in any Canadian
jurisdiction, and there are no assurance that the Company will ever become
a reporting issuer in any Canadian jurisdiction, with the result that
Common Shares and Purchase Warrants issued to residents of Canada, and any
Warrant Shares purchased by residents of Canada upon exercise of Purchase
Warrants, may be restricted from resale or transfer in Canada for an
indefinite period of time;
(m) certificates representing any Common Shares and Purchase Warrants
issued to residents of Canada will be required to bear the following
legend, in addition to the legend referred to in subsection 7(i):
UNLESS PERMITTED UNDER SECURITIES LEGISLATION, THE HOLDER OF THIS
SECURITY MUST NOT TRADE THE SECURITY BEFORE THE DATE THAT IS FOUR
MONTHS AND A DAY AFTER THE LATER OF (i) [INSERT THE DISTRIBUTION
DATE], AND (ii) THE DATE THE ISSUER BECAME A REPORTING ISSUER IN ANY
PROVINCE OR TERRITORY.
(n) certificates representing any Warrant Shares purchased by residents of
Canada upon exercise of Purchase Warrants during the currency of the resale
restrictions imposed by applicable provincial securities laws, will also be
imprinted with the legends referred to in subsections 7(i) and 7(m).
INDEMNIFICATION
8. The Purchaser hereby indemnifies and holds harmless the Company and its
officers, directors, agents and affiliates from and against all damages, losses,
costs and expenses (including reasonable attorneys' fees) which they may incur
by reason of the Purchaser's (or such other's) failure to fulfill any of the
terms or conditions of this Agreement or the investor certificates, or by reason
of any untrue statement made herein or therein or any breach of any
representation, warranty, acknowledgment or agreement made herein or therein.
PURCHASE, SALE AND DELIVERY OF THE UNITS
9. On the basis of the representations, warranties and agreements herein
contained, but subject to the terms and conditions herein set forth (including,
without limitation, acceptance of this subscription by the company), the Company
agrees to sell to the Purchaser, and the Purchaser agrees to purchase from the
Company, the number of Units set forth in Section 3 of this Agreement for the
aggregate purchase price set forth in Section 3.
The completion of the issue and sale of the Units by the Company to the
Purchaser pursuant to this Agreement (the "Closing") shall take place at 10:00
a.m. (Mountain time) on October 31, 2005, at the principal offices of the
Company in Dragoon Arizona, or at such later time and/or date, and/or at such
other place, as the Company may elect in its sole discretion by notice in
writing (the "Extension Notice") to the Purchaser; provided that the Election
Notice is sent to the
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Purchaser not less than twenty-four hours prior to the scheduled time for
Closing. For greater certainty, the Company may provide successive Extension
Notices to the Purchaser.
Certificates representing the aggregate number of shares of Common Stock and
Purchase Warrants will be delivered to the Purchaser at Closing, subject to
receipt by the Company of the purchase price for the Units, in United States
Dollars, in immediately available funds. Payment may be effected by certified
check or bank draft drawn on a major United States bank or by electronic
transfer of immediately available funds to a bank account nominated by the
Company pursuant to wire instructions to be provided to the Purchaser by the
Company upon written request.
MISCELLANEOUS
10. All dollar amounts referred to in this Agreement are in lawful money of the
United States of America.
11. This Agreement shall be governed by and construed in accordance with the
laws of the State of Delaware in the United States.
12. This Agreement contains the entire agreement between the parties. The
provisions of this Agreement may not be modified or waived except in writing.
13. The headings of this Agreement are for convenience of reference only, and
they shall not limit or otherwise affect the interpretation of any term or
provision hereof.
14. This Agreement and the rights, powers and duties set forth herein shall,
except as set forth herein, bind and inure to the benefit of the heirs,
executors, administrators, legal representatives, successors and assigns of the
parties hereto.
15. The Purchaser may not assign any of Purchaser's rights or interest in and
under this Agreement without the prior written consent of the Company, and any
attempted assignment without such consent shall be void and without effect.
16. The entity executing this Agreement represents that it has all required
power and authority to execute, deliver and perform this Agreement for itself
and for the behalf of the beneficial owners of the Units.
COUNTERPARTS AND ELECTRONIC DELIVERY
17. This Agreement shall be executed in two counterparts, each of which shall
constitute an original. The Company shall retain one counterpart, and one
counterpart shall be returned to the Purchaser upon acceptance thereof by the
Company.
18. Delivery of an executed copy of this Agreement by electronic facsimile
transmission or other means of electronic communication capable of producing a
printed copy will be deemed to be execution and delivery of this Agreement as of
the effective date of this Agreement.
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IN WITNESS WHEREOF the undersigned has executed this Agreement, as Purchaser, on
this ______ day of October, 2005.
DELIVERY INSTRUCTIONS (COMPLETE ONLY IF APPLICABLE.)
The name and address of the person to whom the certificates representing the
securities purchased hereunder is to be delivered, if other than the Purchaser:
Name: Address:
------------------------------- -------------------------------
(Print or type) (Xxxxxx Xxxxxxx)
Telephone No.: -------------------------------
----------------------- (City and Province)
-------------------------------
(Postal Code)
TYPE OF OWNERSHIP (CHECK ONE)
[ ] Individual Ownership (one signature required)
[ ] Joint Tenants with Right of Survivorship (both parties must sign)
[ ] Tenants in Common (both parties must sign)
[ ] Trust (please include name of trust, name of trustee, date trust was
formed and provide a copy of the Trust Agreement or other
authorization)
[ ] Partnership (please include a copy of the Partnership Agreement)
[ ] Community Property (one signature required if interest held in one
name, i.e., managing spouse; two signatures required if interest held
in both names)
[ ] Corporation (please include certified corporate resolution authorizing
signature and investment in the program)
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------------------------------------- Social Security, Social Insurance or Tax
Signature of Purchaser Identification Number:
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Name of Purchaser (Please Print)
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Address of Purchaser
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( )
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Telephone Number of Purchaser
------------------------------------- Social Security, Social Insurance or Tax
Signature of Purchaser Identification Number:
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Name of Purchaser (Please Print)
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Address of Purchaser
-------------------------------------
( )
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Telephone Number of Purchaser
ACCEPTED:
NORD RESOURCES CORPORATION
By:
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Authorized Officer
Date:
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