SUBSCRIPTION AGREEMENT
TO: XILLIX TECHNOLOGIES CORP. (the "Corporation")
1. The undersigned hereby irrevocably subscribes for and agrees to purchase,
subject to the terms and conditions of this Subscription Agreement, 2,691,904
common shares in the capital of the Corporation (the "Purchased Securities") for
an aggregate consideration of $7,187,384 (Canadian), representing a subscription
price of $2.67 (Canadian) per Purchased Security.
2. The undersigned acknowledges that the issuance and sale of the Purchased
Securities is subject to the approval of The Toronto Stock Exchange (the
"Exchange"). The undersigned further acknowledges that, pursuant to the terms of
a financial advisory agreement dated September 4, 1997 between the Corporation
and 1991 Capital West Partners ("Capital West"), as amended, the Corporation
will pay to Capital West an advisory fee in the amount of 5% of the gross
proceeds received by it from the issue and sale of the Purchased Securities.
3. By executing this Subscription Agreement, the undersigned represents,
warrants and covenants to the Corporation (and acknowledges that the Corporation
and its counsel are relying thereon) that:
(a) the issue and sale of the Purchased Securities to it or, if
applicable, to any purchaser on whose behalf it is contracting
hereunder, is being made in reliance upon exemptions from the
requirements as to the involvement of a registered dealer, the filing
of a prospectus and the delivery of an offering memorandum as set out
in securities legislation in British Columbia relating to the sale of
the Purchased Securities;
(b) the Purchased Securities will be subject to certain resale
restrictions under applicable securities laws and that the undersigned
agrees to comply with such restrictions. The undersigned also
acknowledges that it has been independently advised with respect to
applicable resale restrictions, that no representation has been made
to it by or on behalf of the Corporation with respect thereto and that
it is solely responsible for complying with such restrictions (and the
Corporation is not in any manner responsible for ensuring such
compliance);
(c) it is aware of the characteristics of the Purchased Securities, the
risks relating to an investment therein and of the fact that it will
not be able to resell the Purchased Securities except in accordance
with limited exemptions under applicable securities legislation and
regulatory policy;
(d) it has not received, nor has it requested, nor does it have any need
to receive, any offering memorandum, or any other document (other than
financial statements, interim financial statements or any other
document, other than an offering memorandum, the content of which is
prescribed by statute or regulation) describing the business and
affairs of the Corporation which has been prepared for delivery to,
and review by, prospective purchasers in order to assist it in making
an investment decision in respect of the Purchased Securities and it
is not aware of any advertisement in printed media of general and
regular paid circulation, radio or television with respect to the
distribution of the Purchased Securities;
(e) it is a Delaware corporation whose principal place of business is in
California, and at which this investment decision was made;
(f) it is purchasing the Purchased Securities as principal for its own
account, not for the benefit of any other person, and not with a view
to the resale or distribution of the Purchased Securities;
(g) it has an aggregate acquisition cost of purchasing the Purchased
Securities of not less than $97,000;
(h) it has not been formed solely or primarily for the purpose of
purchasing the Purchased Securities pursuant to exemptions from the
prospectus and/or registration requirements of applicable securities
legislation;
(i) it will not resell or otherwise transfer or dispose of any of the
Purchased Securities except in accordance with the provisions of all
applicable securities laws;
(j) it has been afforded with full access to all relevant financial,
technical, operational and corporate information relating to the
Corporation and the Purchased Securities, has been afforded an
opportunity to ask such questions of the Corporation's officers,
employees, agents, accountants and representatives concerning the
foregoing and all other relevant matters as it has deemed necessary or
desirable, has been given all such information that has been requested
in order to assess and evaluate the Purchased Securities and the
merits and the risks of the transactions contemplated herein, and, as
a result, has acquired sufficient information concerning the
Corporation to make an informed and knowledgeable decision with
respect to the purchase of the Purchased Securities;
(k) this Subscription Agreement has been duly and validly authorized,
executed and delivered by and constitutes a legal, valid, binding and
enforceable obligation of the undersigned;
(l) it has such knowledge and experience in financial and business affairs
as to be capable of evaluating the merits and risks of its investment
in the Purchased Securities and is able to bear the economic risk of
loss of its investment;
(m) if required by applicable securities legislation, policy or order or
securities commission, stock exchange or other regulatory authority,
the undersigned will execute, deliver, file and otherwise assist the
Corporation in filing, such reports, undertakings, forms and other
documents with respect to the issue of the Purchased Securities
(including, without limitation, the undertaking required by the
Exchange in the form attached as Schedule A hereto) as may be required
by any securities commission, stock exchange or other regulatory
authority;
(n) the Purchased Securities are not being purchased by the undersigned as
a result of any material information concerning the Corporation that
has not been publicly disclosed and the undersigned's decision to
tender this offer and acquire the Purchased Securities has not been
made as a result of any verbal or written representation as to fact or
otherwise made by or on behalf of the Corporation, Capital West or any
other person and is based entirely upon currently available public
information concerning the Corporation;
(o) it understands that the Purchased Securities have not been and will
not be registered under the U.S. Securities Act or any state
securities law, and that the sale contemplated hereby is being made in
reliance on Rule 506 of Regulation D under the U.S. Securities Act
("Regulation D");
(p) it is an "accredited investor" as defined in Rule 501(a) of Regulation
D;
(q) if it decides to offer, sell or otherwise transfer the Purchased
Securities, such securities may be offered, sold or otherwise
transferred only (i) to the Corporation, (ii) outside the United
States in accordance with Rule 904 of Regulation S under the U.S.
Securities Act, or (iii) inside the United States in accordance with
(A) Rule 144A under the U.S. Securities Act to a person who the seller
reasonably believes is a Qualified Institutional Buyer (as defined in
Rule 144A) that is purchasing for its own account or for the account
of a Qualified Institutional Buyer to whom notice is given that the
offer, sale or transfer is being made in reliance on Rule 144A, (B)
the exemption from registration under the U.S. Securities Act provided
by Rule 144 thereunder, if applicable, or (C) with the prior written
consent of the Corporation, another exemption from registration under
the U.S. Securities Act.
(r) all certificates representing the Purchased Securities, as well as all
certificates issued in exchange for or in substitution of the
foregoing securities, will bear a legend to the following effect:
"THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER
THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "U.S.
SECURITIES ACT"), THE HOLDER HEREOF, BY PURCHASING SUCH
SECURITIES, AGREES FOR THE BENEFIT OF XILLIX TECHNOLOGIES CORP.
THAT SUCH SECURITIES MAY BE OFFERED, SOLD OR OTHERWISE
TRANSFERRED ONLY (A) TO XILLIX TECHNOLOGIES CORP., (B) OUTSIDE
THE UNITED STATES IN ACCORDANCE WITH RULE 904 OF REGULATION S
UNDER THE U.S. SECURITIES ACT, OR (C) INSIDE THE UNITED STATES IN
ACCORDANCE WITH (1) RULE 144A UNDER THE U.S. SECURITIES ACT TO A
PERSON WHO THE SELLER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A) THAT IS PURCHASING
FOR HIS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE OFFER, SALE
OR TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (2) THE
EXEMPTION FROM REGISTRATION UNDER THE U.S. SECURITIES ACT
PROVIDED BY RULE 144 THEREUNDER, IF AVAILABLE, OR (3) WITH THE
PRIOR WRITTEN CONSENT OF XILLIX TECHNOLOGIES CORP., ANOTHER
EXEMPTION FROM REGISTRATION UNDER THE U.S. SECURITIES ACT.
DELIVERY OF THIS CERTIFICATE MAY NOT CONSTITUTE "GOOD DELIVERY"
IN SETTLEMENT OF TRANSACTIONS ON STOCK EXCHANGES IN CANADA."
provided that, if any such securities are being sold outside the
United States in accordance with Rule 904 of Regulation S, the legend
may be removed by providing both the seller's and broker's
representation letters to CIBC Mellon Trust Company, as registrar and
transfer agent, to the effect set forth in Schedule B to this
Subscription Agreement, or in such other form as CIBC Mellon Trust
Company or the Corporation may from time to time prescribe;
(s) it understands and acknowledges that the Corporation may instruct CIBC
Mellon Trust Company not to record a transfer without first being
notified by the Corporation that it is satisfied that such transfer is
exempt from or not subject to registration under the U.S. Securities
Act; and
(t) it acknowledges that, pursuant to British Columbia Securities
Commission Blanket Order BOR#95/17, an initial trade report in the
prescribed form in respect of the resale of the Purchased Securities
must be filed within 10 days of the initial trade of such securities
and where the undersigned has filed such an initial trade report, the
undersigned is not required to file a further report in respect of
additional trades of Purchased Securities acquired on the same date
and under the same exemption as the Purchased Securities that are the
subject of the initial trade report.
The undersigned acknowledges that the foregoing representations and
warranties are made by it with the intent that they may be relied upon in
determining the undersigned's eligibility to subscribe for and purchase the
Purchased Securities hereunder. The undersigned further agrees that, by
accepting the Purchased Securities on the Closing Date, it shall be representing
and warranting that the foregoing representations and warranties are true as at
the Closing Date with the same force and effect as if they had been made by it
at the Closing Time.
4. The Corporation represents, warrants and covenants to the undersigned (and
acknowledges that the undersigned is relying thereon) that:
(a) the Corporation and each of its subsidiaries is a valid and subsisting
corporation, duly incorporated or amalgamated and in good standing
under the laws of its jurisdiction of incorporation;
(b) the common shares of the Corporation are listed and posted for trading
on the Exchange and, to the best of its knowledge, the Corporation is
not in default of any of the listing requirement of the Exchange;
(c) the authorized share capital of the Corporation consists of
750,000,000 common shares, of which, as of June 1, 1998, 28,491,525
shares are issued and outstanding as fully paid and non-assessable;
(d) the Corporation is a "reporting issuer" not in default under the
applicable securities laws of each of the Provinces of Canada other
than Quebec;
(e) no person, firm or corporation holds any securities convertible into
shares of the Corporation or has any agreement, warrant, option, right
or privilege being or capable of becoming an agreement, warrant,
option or right for the purchase, subscription or issuance of any
unissued securities of the Corporation, except pursuant to this
Agreement and, as of June 1, 1998, pursuant to options which are
exercisable or exchangable into an aggregate of not more than
3,510,000 common shares of the Corporation;
(f) upon their issuance on the Closing Date, the Common Shares will be
validly issued and outstanding as fully paid and non-assessable
securities of the Corporation;
(g) on the Closing Date, the Common Shares will have been conditionally
approved for listing and posted for trading on the Exchange, subject
to the Corporation fulfilling all requirements of the Exchange in
connection therewith;
(h) the Corporation and each of its subsidiaries has the corporate power
and capacity to own and lease its assets and to carry on its business
as now conducted by it;
(i) the Corporation and each of its subsidiaries is conducting its
business in material compliance with all applicable laws, rules and
regulations of each jurisdiction in which its business is carried on
and is duly licensed, registered or qualified in all jurisdictions in
which it owns, leases or operates its property or carries on business
to enable its business to be carried on as now conducted and its
property and assets to be owned, leased and operated and all such
licences, registrations and qualifications are valid and subsisting
and in good standing, except in respect of matters which do not and
will not result in any material adverse change to the business,
business prospects or condition (financial or otherwise) of the
Corporation and its subsidiaries, on a consolidated basis;
(j) the audited financial statements of the Corporation for its fiscal
period ended December 31, 1997 (the "Corporation's Financial
Statements") present fairly the financial position and results of the
operations of the Corporation for the periods then ended and the
Corporation's Financial Statements have been prepared in accordance
with generally accepted accounting principles applied on a consistent
basis;
(k) except as publicly disclosed, since December 31, 1997 there has not
been any adverse material change of any kind whatsoever in the
financial position or condition of the Corporation, or any damage,
loss or other change of any kind whatsoever in circumstances
materially affecting the business or assets of the Corporation, or the
right or capacity of the Corporation to carry on its business;
(l) there has not been any material change in the capital stock or
long-term debt or in the assets, liabilities or obligations (absolute,
accrued, contingent or otherwise) of the Corporation, and its
subsidiaries, on a consolidated basis, since December 31, 1997 that
has not been publicly disclosed;
(m) there has not been any material change in, and there have been no
material facts, transactions, events or occurrences which could
materially adversely affect, the business, business prospects,
condition (financial or otherwise) or results of the operations of the
Corporation, and its subsidiaries, on a consolidated basis, since
December 31, 1997 that has not been publicly disclosed;
(n) except as has been publicly disclosed, since December 31, 1997 the
Corporation and each of its subsidiaries has carried on its business
in the ordinary course;
(o) to the best of its knowledge, except as publicly disclosed, there are
no actions, suits, judgments, investigations or proceedings of any
kind whatsoever outstanding, pending or threatened by or against or
affecting the Corporation 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,
domestic or foreign, of any kind whatsoever, which will materially
adversely affect the business, operations or financial condition of
the Corporation, and its subsidiaries, on a consolidated basis, or any
of its assets or properties, or which materially adversely affects or
may materially adversely affect the distribution of the Purchased
Securities or any action taken or to be taken by the Corporation
pursuant to or in connection with this Subscription Agreement and, to
the best of its knowledge, there is no basis therefor;
(p) no securities commission or similar regulatory authority in Canada has
issued any order preventing or suspending trading in any securities of
the Corporation;
(q) the Corporation will, prior to the Closing Time, fulfil all legal
requirements (including, without limitation, compliance with all
applicable securities laws) to be fulfilled by the Corporation to
enable the Purchased Securities to be offered for sale to the
undersigned as contemplated in this Subscription Agreement;
(r) to the best of its knowledge, the Corporation or, as applicable, each
of its subsidiaries, is not in default or breach of, and the execution
and delivery of, and the performance of and compliance with the terms
of this Subscription Agreement, does not and will not conflict with,
or result in any breach of or the acceleration of any indebtedness
under, or constitute a default under, and does not and will not create
a state of facts which, after notice or lapse of time or both, would
result in a breach of or constitute a default under, any term or
provision of the memorandum, articles, by-laws or resolutions of the
Corporation (including its subsidiaries), or any indenture, contract,
agreement (written or oral), instrument, lease or other document,
including without limitation the contracts to which the Corporation
(including its subsidiaries) is a party or by which it is bound, or
any judgment, decree, order, statute, rule or regulation applicable to
the Corporation (including its subsidiaries), which default or breach
might reasonably be expected to materially adversely affect the
business, operations, capital or condition (financial or otherwise) of
the Corporation (including its subsidiaries) or its assets or
properties;
(s) the Corporation has full corporate power and authority to enter into
this Subscription Agreement and to perform its obligations set out
herein and this Subscription Agreement has been duly authorized,
executed and delivered by the Corporation and is a legal, valid and
binding obligation of the Corporation, enforceable against the
Corporation in accordance with its terms except that:
(i) the enforcement thereof may be limited by bankruptcy, insolvency
and other laws affecting the enforcement of creditors' rights
generally;
(ii) equitable remedies including, without limitation, specific
performance and injunction may be granted only in the discretion
of a court; and
(iii)rights of indemnity, contribution and waiver of contribution may
be limited under applicable law;
(t) there is not, in the constating documents or by-laws of the
Corporation or in any agreement, mortgage, note, debenture, indenture
or other instrument or document to which the Corporation is a party,
any restriction upon or impediment to the declaration or payment of
dividends by the Corporation to the holders of its common shares. The
representations and warranties of the corporation contained in this
Subscription Agreement shall be true at the Closing Time as though
they were made at the Closing Time;
(u) set out in Schedule D hereto is a complete list of all plans and
arrangements under which options or other rights to acquire shares
have been granted by the Corporation, or under which shares of the
Corporation have been reserved for issuance, which, in each case, sets
forth the number of shares reserved for issuance under such plan or
arrangement and the number of options and/or similar rights
outstanding thereunder, in each case as of June 1, 1998;
(v) the Corporation agrees to file a Form D with respect to the Purchased
Securities with the U.S. Securities and Exchange Commission (the
"SEC") as required under Regulation D and to provide a copy thereof to
the undersigned within fifteen (15) days after the Closing Date. The
Corporation shall, on or prior to the Closing Date, take such action
as is necessary under all applicable Securities Laws (as defined
below) to sell the Purchased Securities to the undersigned in the
manner contemplated in this Agreement, and to provide evidence of any
such action so taken to the undersigned on or prior to the Closing
Date. "Securities Laws" shall mean the securities laws, rules and
regulations of Canada, of the United States, and of any state,
province or governmental or regulatory authority of Canada or of the
United States, including blue sky laws;
(w) the Corporation shall, for a period of 18 months after the Closing
Date, provided that it continues to be a reporting issuer in one or
more Canadian jurisdictions and that the undersigned continues to hold
any of the Purchased Securities, timely file all reports required to
be filed with all applicable securities regulatory authorities, and
the Corporation shall not, during such period, terminate its status as
an issuer required to file reports under any applicable Securities Law
even if such Securities Law would permit such termination;
(x) the Corporation shall, for a period of 18 months after the Closing
Date, provided that the undersigned continues to hold any of the
Purchased Securities and that the Corporation continues to be a
reporting issuer in one or more Canadian jurisdictions, send the
following reports to the undersigned: (i) within three (3) business
days after the filing with any securities regulatory authority, a copy
of each annual, quarterly or other periodic report, each proxy
statement and each current report; and (ii) within one (1) business
day after release, a copy of each press release issued by the
Corporation or any of its subsidiaries;
(y) the Corporation shall, for a period of 18 months after the Closing
Date, provided that the Corporation continues to satisfy the listing
requirements of such Exchange(s) and that the undersigned continues to
hold any of the Purchased Securities, continue the uninterrupted
listing and trading of its common shares on The Toronto Stock Exchange
and on any other securities exchange on which any of its securities
may be or become listed and traded, and comply in all respects with
the Corporation's reporting, filing and other obligations under the
By-laws or rules of the Exchange and any such other securities
exchange; and
(z) the Corporation will use the proceeds of the sale of the Purchased
Securities for working capital and/or such other purposes as
management or the Board of Directors of the Corporation shall
determine.
5. The sale of the Purchased Securities will be completed at the offices of
Fraser & Xxxxxx, the Corporation's counsel, in Vancouver, British Columbia at
10:00 a.m. (Vancouver time), or such other time as the Corporation and the
undersigned may agree upon in writing (the "Closing Time") on June 2, 1998, or
such other date as the Corporation and the undersigned may agree upon in writing
(the "Closing Date"). The certificate for the Purchased Securities subscribed
for by the undersigned hereunder will, on the Closing Date, be issued and
registered in the name set out in the Registration Instructions below and will
promptly thereafter be delivered in accordance with the Delivery Instructions
below.
6. The obligation of the undersigned to complete the subscription contemplated
hereby will be subject to and conditional on the fulfilment on or before the
Closing Time of the following conditions, compliance with which may be waived in
whole or in part by the undersigned, at any time, in its discretion and upon
such terms as it may consider appropriate:
(a) the representations and warranties of the Corporation contained herein
will be true at and as of the Closing Time as though such
representations and warranties were made again at and as of such time;
(b) the Corporation will have performed and complied with all covenants,
agreements and conditions required hereby to be performed or complied
with by the Corporation prior to Closing Time;
(c) the Exchange will have accepted notice of the issuance of the
Purchased Securities as contemplated by the terms of this Agreement,
subject only to the filing of all required documents and the payment
of the required fees within the times stipulated by the Exchange;
(d) no order, judgment, injunction, decree, award or writ of any court,
tribunal, arbitrator, governmental agency or other person will have
been entered that prohibits or restricts the completion of the
subscription or which, in the opinion of the undersigned, acting
reasonably, could prevent or restrict any party hereto from performing
any of its obligations hereunder;
(e) the undersigned will have received a favourable written opinion of the
Corporation's counsel, dated the Closing Date, substantially in the
form attached hereto as Schedule C;
(f) the purchase by the Corporation of 58,909 common shares in the capital
of the undersigned, at an aggregate subscription price of U.S.
$2,000,000, pursuant to a subscription agreement of even date; and
(g) the execution and delivery of a Strategic Alliance Agreement between
the Corporation and the undersigned, in form and substance acceptable
to each of them.
7. The obligation of the Corporation to complete the transactions contemplated
hereby will be subject to and conditional on the fulfillment on or before the
Closing Time of the following conditions, compliance with which may be waived in
whole or in part by the Corporation, at any time, in its discretion and upon
such terms as it may consider appropriate:
(a) the representations and warranties of the undersigned contained herein
will be true at and as of the Closing Time as though such
representations and warranties were made again at and as of such time;
(b) the undersigned will have performed and complied with all covenants,
agreements and conditions required hereby to be performed or compiled
with by the undersigned prior to the Closing Time;
(c) the Exchange will have accepted notice of the issuance of the
Purchased Securities as contemplated by the terms of this Agreement,
subject only to the filing of all required documents and the payment
of the required fees within the times stipulated by the Exchange;
(d) no order, judgment, injunction, decree, award or writ of any court,
tribunal, arbitrator, governmental agency or other person will have
been entered that prohibits or restricts the completion of the
subscription or which, in the opinion of the Corporation, acting
reasonably, could prevent or restrict any party hereto from performing
any of its obligations hereunder;
(e) the purchase by the Corporation of 58,909 common shares in the capital
of the undersigned, at an aggregate subscription price of U.S.
$2,000,000, pursuant to a subscription agreement of even date; and
(f) the execution and delivery of a Strategic Alliance Agreement between
the Corporation and the undersigned, in form and substance acceptable
to each of them.
8. The undersigned agrees to deliver to the Corporation, not later than 5:00
p.m. (Vancouver time) at least two business days prior to the Closing Date:
(a) two manually signed and completed copies of the Private Placement
Questionnaire and Undertaking attached as Schedule A and such other
documents as may be requested as contemplated by paragraph 3(m)
hereof; and
(b) a certified cheque or bank draft payable to the Corporation or its
counsel, Fraser & Xxxxxx, in trust, for the aggregate subscription
price of the Purchased Securities subscribed for under this
Subscription Agreement or payment of the same amount in such other
manner as is acceptable to the Corporation.
9. This subscription may be accepted or rejected by the Corporation.
Confirmation of acceptance or rejection of a subscription will be forwarded to
the undersigned promptly after the acceptance or rejection of the subscription.
If this subscription is rejected, the undersigned understands that, if it has
delivered a certified cheque or bank draft representing the purchase price of
the Purchased Securities subscribed for, such cheque or bank draft will be
promptly returned to it without interest.
10. The undersigned agrees to indemnify and hold harmless the Corporation, and
its directors, officers, employees, agents, advisors and shareholders, from and
against any and all loss, liability, claim, damage and expense whatsoever
including, but not limited to, any and all fees, costs and expenses whatsoever
reasonably incurred in investigating, preparing or defending against any
litigation, administrative proceeding or investigation commenced or threatened
or any claim whatsoever arising out of or based upon any representation or
warranty of the undersigned contained herein or in any document furnished by the
undersigned to the Corporation in connection herewith being untrue in any
material respect or any breach or failure by the undersigned to comply with any
covenant or agreement made by the undersigned herein or in any document
furnished by the undersigned to the Corporation in connection herewith.
11. The Corporation agrees to indemnify and hold harmless the undersigned, and
its directors, officers, employees, agents, advisors and shareholders, from and
against any and all loss, liability, claim, damage and expense whatsoever
including, but not limited to, any and all fees, costs and expenses whatsoever
reasonably incurred in investigating, preparing or defending against any
litigation, administrative proceeding or investigation commenced or threatened
or any claim whatsoever arising out of or based upon any representation or
warranty of the Corporation contained herein or in any document furnished by the
Corporation to the undersigned in connection herewith being untrue in any
material respect or any breach or failure by the Corporation to comply with any
covenant or agreement made by the Corporation herein or in any document
furnished by the Corporation to the undersigned in connection herewith.
12. Before Closing Time, no party hereto will make any public statement or issue
any press release concerning the transactions contemplated herein, except as may
be necessary, in the opinion of counsel to the party making such disclosure, to
comply with the requirements of any applicable law, order, rule, regulation or
published policy of any regulatory authority having jurisdiction. Upon any
public statement or release being so required, the party making such disclosure
will consult with the other party prior to making any statement or issuing a
press release and the parties will use all reasonable efforts, acting
expeditiously and in good faith, to agree upon a text for such statement or
release which is satisfactory to each of them. If the parties fail to agree upon
such text, the party making the disclosure will make only such public statement
or release as its counsel advises in writing is legally required to be made.
13. The covenants, representations and warranties contained herein shall survive
the closing of the transactions contemplated hereby, notwithstanding any
investigation at any time made, or any evidence as to the truth or accuracy
thereof at any time accepted, by or on behalf of the other party.
14. The Corporation shall be entitled to rely on delivery of a facsimile copy of
this Agreement, and acceptance by the Corporation of such facsimile copy shall
be legally effective to create a valid and binding agreement between the
undersigned and the Corporation in accordance with the terms hereof.
15. This Subscription Agreement shall be governed by and construed in accordance
with the laws of the Province of British Columbia and the laws of Canada
applicable therein. This Subscription Agreement is not transferable or
assignable by either of the parties hereto. Time shall be of the essence hereof.
DATED at the City of Santa Xxxxxxx, in the State of California this
______ day of June, 1998.
MIRAVANT MEDICAL TECHNOLOGIES ___________________________________
(Name of Subscriber - please print) Address:
By:/S/
------------------------------
Authorized Signature
_____________________________________ ___________________________________
(Official Capacity or Title,- please print) (Telephone Number)
Registration Instructions: Delivery Instructions:
Register the Purchased Securities Deliver the Purchased Securities
as set forth below: as set forth below:
Name Name
Account reference, if applicable Account reference, if applicable
Address Contact Name
Telephone Number
ACCEPTANCE
Xillix Technologies Corp. hereby accepts the above subscription and
agrees to be bound by all of the covenants and agreements on its part set
forth above as of this _________ day of June, 1998. XILLIX TECHNOLOGIES
CORP.
Per:/S/
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Per:/S/
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SCHEDULE A
TSE QUESTIONNAIRE AND UNDERTAKING
NOTE: The attached must be completed in duplicate.
THE TORONTO STOCK EXCHANGE
PRIVATE PLACEMENT QUESTIONNAIRE AND UNDERTAKING
QUESTIONNAIRE
1. DESCRIPTION OF TRANSACTION
(a) Name of Issuer of the Securities: Xillix Technologies Corp.
(b) Number and class of Securities to be Purchased: 2,691,904 Common
shares.
(c) Purchase Price: $2.67 per Share.
2. DETAILS OF PURCHASER
(a) Name of Purchaser: Miravant Medical Technologies
(b) Address: 0000 Xxxxxxxxx Xxxxxx, Xxxxx Xxxxxxx, XX, 00000
(c) Names and addresses of persons having a greater than 10% beneficial
interest in the purchaser:
3. RELATIONSHIP TO ISSUER
(a) Is the purchaser, or any person named in response to 2(c) above, an
insider of the issuer for the purposes of the Ontario Securities Act
(before giving effect to this private placement)? If so, state the
capacity in which the purchaser (or person named in response to 2(c)
qualifies an insider:
(b) If the answer to (a) is "no", are the purchaser and the issuer
controlled by the same person or company? If so, give details:
4. DEALINGS OF PURCHASER IN SECURITIES OF THE ISSUER
Give details of all trading by the purchaser, as principal, in the
securities of the issuer (other than debt securities which are not
convertible into equity securities), directly or indirectly, within the 60
days preceding the date hereof:
UNDERTAKING
To: The Toronto Stock Exchange
The undersigned has subscribed for and agreed to purchase, as principal,
the securities described in item 1 of this Private Placement Questionnaire and
Undertaking.
The undersigned undertakes not to sell or otherwise dispose of any of the
said securities so purchased or any securities derived therefrom for a period of
six months from the date of the closing of the transaction herein or for such
period as is prescribed by applicable securities legislation, whichever is the
longer, without the prior consent of The Toronto Stock Exchange and any other
regulatory body having jurisdiction.
Dated at the City of Santa Xxxxxxx, in the State of California, this
______ day of June, 1998.
MIRAVANT MEDICAL TECHNOLOGIES
(Name of Purchaser - please print)
By:/S/
------------------------------
Authorized Signature
___________________________________
(Official Capacity or Title, if
applicable - please print)
___________________________________
(Please print name of individual
whose signature appears above if
different than the name of the
purchaser printed above)
SCHEDULE B
REPRESENTATION LETTERS OF THE SELLER AND BROKER
See attached
REPRESENTATION LETTER OF THE SELLER
Date: _________________________
CIBC MELLON TRUST COMPANY,
as registrar and transfer agent
for the Common Shares of Xillix Technologies Inc.
X.X. Xxx 0000
Xxxx Xxxxx
0000 Xxxx Xxxxxxxx Xx.
Xxxxxxxxx, XX X0X 0X0
Dear Sir/Madam:
Sale of Common Shares
The undersigned (the "Seller") proposes to sell _______________ shares of
common stock, represented by certificate number __________ (the "Shares"), of
Xillix Technologies Inc. (the "Company") through _____________________________
[Name of Broker] pursuant to Rule 904 of Regulation S under the United States
Securities Act of 1933, as amended. In order to induce you to render your advice
to the transfer agent of the Company, enabling such transfer agent to remove the
restrictive legend and any stop transfer order from the Shares, the undersigned
hereby represents and warrants to you as follows:
(1) no offer to sell the Shares will be made to a person in the United
States;
(2) the undersigned either: (a) is not an "affiliate" (as defined below)
of the Company, or (b) is an affiliate of the Company solely by virtue
of holding a position as a director or officer of the Company;
(3) the sale of the Shares will be executed in, on or through the
facilities of The Toronto Stock Exchange in accordance with the
procedures of such exchange, and neither the undersigned nor any
person acting on the undersigned's behalf knows that the sale has been
prearranged with a buyer in the United States;
(4) no "directed selling efforts" will be made in the United States by the
undersigned, any affiliate of the undersigned, or any person acting on
behalf of the undersigned;
(5) the undersigned is not a person who participates, pursuant to any
contractual arrangement, in the distribution of these securities;
(6) that in the event the undersigned is a director or officer of the
Company, the undersigned represents that, in connection with the
proposed sale of Shares, no selling concession, fee or other
remuneration will be paid in connection with such offer or sale other
than the usual and customary broker's commission that will be received
by a person executing such transaction as agent; and
(7) the transactions described herein are not a part of or incident to any
hedging transaction.
For purposes of these representations, "affiliate" means a person that
directly, or indirectly through one or more intermediaries, controls, or is
controlled by, or is under common control with, the Company. "Directed selling
efforts" means any activity undertaken for the purposes of, or that could
reasonably be expected to have the effect of, conditioning the market in the
United States for the Shares. This would include, but not be limited to, the
solicitation of offers to purchase the Shares from persons in the United States.
"United States" means the United States of America, its territories or
possessions, any State of the United States, and the District of Columbia.
The undersigned understands that the Company is relying upon the
representations contained in this letter and agrees that legal counsel to the
Company shall be entitled to rely upon the representations, warranties and
covenants contained in this letter to the same extent as if this letter had been
addressed to them.
Yours very truly,
---------------------------
REPRESENTATION LETTER OF THE BROKER
[Letterhead Of Broker]
Date: ____________________
CIBC MELLON TRUST COMPANY,
as registrar and transfer agent
for the Common Shares of Xillix Technologies Inc.
X.X. Xxx 0000
Xxxx Xxxxx
0000 Xxxx Xxxxxxxx Xx.
Xxxxxxxxx, XX X0X 0X0
Dear Sir/Madam:
Sale of Shares Pursuant to SEC Rule 904
We have read the representation letter of our customer,
_________________________ (the "Seller") dated _______________________, pursuant
to which the Seller has requested that we sell, for the Seller's account,
_____________ shares of common stock represented by certificate number _______
(the "Shares") of Xillix Technologies Inc. (the "Company"). We will execute
sales of the Shares pursuant to Rule 904 of Regulation S under the United States
Securities Act of 1933, as amended, on behalf of the Seller. In that connection,
we hereby represent to you as follows:
(1) no offer to sell the Shares will be made to a person in the United
States;
(2) the sale of the Shares will be executed in, on or through the
facilities of The Toronto Stock Exchange, and, to the best of our
knowledge, the sale will not be pre-arranged with a buyer in the
United States;
(3) no "directed selling efforts" will be made in the United States by the
undersigned, any affiliate of the undersigned, or any person acting on
behalf of the undersigned;
(4) we will do no more than execute the order or orders to sell the Shares
as agent for the Seller and will receive no more than the usual and
customary broker's commission that would be received by a person
executing such transaction as agent; and
(5) to the best of our knowledge the transactions described herein are not
a part of or incident to any hedging transaction.
For purposes of these representations, "affiliate" means a person that
directly, or indirectly through one or more intermediaries, controls, or is
controlled by, or is under common control with, the undersigned. "Directed
selling efforts" means any activity undertaken for the purpose of, or that could
reasonably be expected to have the effect of, conditioning the market in the
United States for the Shares. This would include, but not be limited to, the
solicitation of offers to purchase the Shares from persons in the United States.
"United States" means the United States of America, its territories or
possessions, any State of the United States, and the District of Columbia.
Legal counsel to the Company shall be entitled to rely upon the
representations, warranties and covenants contained in this letter to the same
extent as if this letter had been addressed to them.
If you have any questions regarding this transaction, please telephone the
undersigned at (_____)______-__________.
Sincerely,
___________________________________
[Name of Broker]
By:________________________________
Title: ____________________________
SCHEDULE C
FORM OF LEGAL OPINION
June 2, 1998
Xillix Technologies Corp.
000-00000 Xxxxxxxx Xxxxxxx
Xxxxxxxx, Xxxxxxx Xxxxxxxx
X0X 0X0
-and-
Miravant Medical Technologies
0000 Xxxxxxxxx Xxxxxx
Xxxxx Xxxxxxx, XX
00000
Dear Sirs/Mesdames:
Xillix Technologies Corp.
- Issuance of Common Shares to Miravant Medical Technologies
We have acted as counsel to Xillix Technologies Corp. (the "Company") in
connection with the issuance by the Company of 2,691,904 common shares (the
"Purchased Securities") to Miravant Medical Technologies (the "Purchaser")
pursuant to a subscription agreement between the Company and the Purchaser dated
as of the 2nd day of June, 1998 (the "Xillix Subscription Agreement").
We have reviewed:
(a) an executed copy of the Xillix Subscription Agreement;
(b) an executed copy of the Strategic Alliance Agreement between the
Company and the Purchaser dated as of June 2, 1998 relating to the
development and commercialization of the Purchaser's photodynamic
therapy technology with the Company's fluorescence imaging technology
(the "Strategic Alliance Agreement");
(c) an executed copy of the subscription agreement between the Purchaser
and the Company relating to the issue and sale of 58,909 common shares
of the Purchaser (the "Miravant Subscription Agreement");
(d) a certificate of the President and Chief Executive Officer and the
Corporate Secretary of the Company dated June 2, 1998 relating to
certain factual matters;
(e) a certificate of the Corporate Secretary of the Company dated June 2,
1998 with respect to the Memorandum and Articles of the Company and,
among other things, the resolutions of the directors of the Company
approving the issue and sale of the Purchased Securities and the
entering into of the Xillix Subscription Agreement, the Miravant
Subscription Agreement and the Strategic Alliance Agreement
(collectively, the "Agreements");
(f) a certificate of CIBC Mellon Trust Company, the registrar and transfer
agent for the common shares of the Company (the "Transfer Agent"),
dated June 2, 1998 confirming the number of outstanding common shares
of the Company; and
(g) correspondence from The Toronto Stock Exchange (the "Exchange")
relating to the listing of the Purchased Securities.
We have examined such statutes and regulations, corporate records,
certificates and other documents and have considered such questions of law and
have made such other examinations, searches and investigations as we have
considered relevant and necessary as a basis for the opinions hereinafter set
forth. In such examination, we have assumed the genuineness of all signatures
and the authenticity of all documents submitted to us as originals and the
conformity to authentic originals of all documents submitted to us as certified,
notarial or true copies or reproductions. We have also assumed, for the purposes
of the opinions expressed herein, that the Xillix Subscription Agreement has
been duly authorized, executed and delivered by the Purchaser and is binding
upon and enforceable against the Purchaser.
As to various questions of fact material to the opinions herein,
information with respect to which is in the possession of the Company, we have
relied upon the certificates referred to in subparagraphs (d) and (e) above
(collectively, the "Company Certificates"), copies of which have been delivered
to you today. We have also relied on certain other certificates with respect to
certain factual matters.
For the purposes of the opinions expressed below, we have assumed:
(a) the accuracy of the representations, warranties and acknowledgements
of the Purchaser set out in each of the Agreements; and
(b) that there has been no advertisement of the Purchased Securities, or
of the offering or sale thereof, whether in printed media of general
and regular paid circulation, on radio or television or otherwise, and
that no offering memorandum has been delivered to the Purchaser.
In expressing the opinion set forth in paragraph 1, we have relied solely
upon a Certificate of Good Standing for the Company issued by the Registrar of
Companies, dated June 1, 1998, a copy of which has been delivered to you today.
In expressing the opinion set forth in paragraph 7, we have not reviewed
the register of members of the Company but have relied solely upon the Company
Certificates and the confirmation of the Transfer Agent referred to in
subparagraph (d) above.
In expressing the opinion set forth in paragraph 10, we have relied solely
upon a certificate of the British Columbia Securities Commission ("BCSC"), dated
June 1, 1998, a copy of which has been delivered to you today.
The opinions expressed below are subject to the qualification that no
effective order, ruling or decision has been issued or granted by a court or
regulatory or administrative body that has the effect of precluding or
restricting the offering, issue or sale by the Company of the Purchased
Securities or restricting any trades of any securities of the Company and at the
relevant time there is no such order affecting any person engaged in such a
trade.
Whenever our opinion with respect to the existence or absence of facts or
circumstances is qualified by the phrases "of which we are aware" or "to our
knowledge", it is intended to indicate that during the course of our
representation of the Company no information has come to our attention which
would give us actual knowledge of the existence of such facts or circumstances.
However, other than a review of the Company Certificates, the Agreements and
certain corporate proceedings of the Company which were made available to us and
an examination of our files and inquiries of the lawyers of this firm
responsible for files relating to the Company, we have not undertaken any
special or independent investigation to determine the existence or absence of
such facts or circumstances. No inference as to our knowledge as to such facts
and circumstances should be drawn merely from our representation of the Company.
The opinions expressed herein are restricted to the laws of the Province of
British Columbia and the federal laws of Canada applicable therein. In
particular, we express no opinion with respect to the laws of the United States
of America or any state thereof.
Based and relying upon and subject to the foregoing, we are of the opinion
that:
1. The Company has been duly amalgamated and validly exists under the
laws of the Province of British Columbia and is in good standing with
respect to the filing of its annual returns with the Office of the
Registrar of Companies of British Columbia.
2. The Company has all requisite corporate capacity, power and authority
to carry on its business as now conducted by it, to own its assets and
to enter into, deliver and to perform its obligations under the
Agreements.
3. Each of the Agreements has been duly authorized by all necessary
corporate action on the part of the Company and has been duly executed
and delivered by and on behalf of the Company.
4. The Xillix Subscription Agreement is a valid and legally binding
obligation of the Company, enforceable against the Company in
accordance with its terms, except as rights to indemnity and waiver of
contribution thereunder may be limited under applicable law, and
subject to bankruptcy, insolvency, liquidation, reorganization,
reconstruction and other similar laws of general application affecting
the enforcement of creditors' rights and to the availability of
equitable remedies being in the discretion of a court of competent
jurisdiction.
5. None of the execution and delivery of any of the Agreements, nor the
fulfillment by the Company of the terms thereof, conflicts or will
conflict with or results or will result in a breach of, or creates a
state of facts which, after notice or lapse of time or both, will
result in a breach of or conflict with any of the terms, conditions or
provisions of the Memorandum or Articles of the Company or, to our
knowledge, of any resolutions of its shareholders or directors or any
material license or permit issued to the Company or any agreement or
instrument to which the Company is a party or by which it is bound as
of the date hereof.
6. The Purchased Securities have been duly and validly allotted and
issued as fully paid and non-assessable common shares in the capital
of the Company, and have been duly and validly registered in the name
of the Purchaser.
7. The authorized share capital of the Company consists of 750,000,000
common shares without par value, of which 28,491,525 common shares
were issued and outstanding as of the close of business on June 1,
1998 (ie, prior to giving effect to the issue of the Purchased
Securities).
8. The Exchange has accepted notice of the issuance of the Purchased
Securities and has conditionally approved the listing thereof on the
Exchange, subject to the satisfaction of the conditions to such
acceptance and approval stipulated by the Exchange, the filing of all
required documents and the payment of the required fees, all within
the times stipulated by the Exchange, and all as set forth in the
correspondence from the Exchange referred to in subparagraph (g) on
page 2.
9. To our knowledge, there are no actions, suits, proceedings or
investigations, whether on behalf of or against the Company and its
subsidiaries, taken as a whole, pending or threatened against or
affecting the Company and its subsidiaries, taken as a whole, at law
or in equity, before or by any federal, provincial, municipal or
governmental department, commission, board, bureau, agency or
instrumentality, domestic or foreign, which would reasonably be
expected to materially adversely affect the property, assets or
business of the Company and its subsidiaries, taken as a whole, or
which questions the validity of the issuance and sale, as fully paid
and non-assessable, of all or any of the outstanding common shares of
the Company, or any action taken or to be taken by the Company
pursuant to or in conjunction with any of the Agreements.
10. The Company is a reporting issuer and is not in default of filing
financial statements or paying fees and charges relating to those
filings required by the Securities Act (British Columbia) (the "B.C.
Act") and the regulations thereunder.
11. The offering, sale and delivery of the Purchased Securities by the
Company to the Purchaser in accordance with the terms of the Xillix
Subscription Agreement are exempt, either by statute, regulation, rule
or order, from the prospectus requirements of the B.C. Act and, except
as have been obtained or completed, no documents are required to be
filed, proceedings taken, and no approval or consent of, or
registration or filing with, any regulatory authority in British
Columbia is required, in order to permit the offering, issuance, sale
and delivery of the Purchased Securities by the Company to the
Purchaser, except for the filing within 10 days of the date hereof of
reports in prescribed form prepared and executed in accordance with
applicable securities laws, together with applicable fees.
12. The first trade of any of the Purchased Securities by the Purchaser in
British Columbia will be deemed to be a distribution in such Province
and accordingly will be subject to the prospectus and registration
requirements contained in the B.C. Act, unless otherwise exempted from
those requirements.
This opinion is limited to the specific issues addressed herein and is
limited in all respects to laws and interpretations thereof existing on the date
hereof. We do not undertake to update this opinion for changes in such laws or
interpretations. This opinion may be relied upon by you solely in connection
with the transaction contemplated herein and is not to be relied upon by any
other person or for any other purpose unrelated to this transaction without our
prior written consent.
Yours very truly,
SCHEDULE D
PLANS AND ARRANGEMENTS
Please see attached.
