NONE OF THE SECURITIES TO WHICH THIS PRIVATE PLACEMENT SUBSCRIPTION AGREEMENT
(THE "SUBSCRIPTION AGREEMENT") RELATES HAVE BEEN REGISTERED UNDER THE U.S.
SECURITIES ACT OF 1933 ("XXX 0000 XXX"), OR ANY U.S. STATE SECURITIES LAWS, AND,
UNLESS SO REGISTERED, NONE MAY BE OFFERED OR SOLD IN THE UNITED STATES OR TO
U.S. PERSONS (AS DEFINED HEREIN) EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE 1933 ACT, OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN
A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE 1933 ACT AND
IN EACH CASE ONLY IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS.
PRIVATE PLACEMENT SUBSCRIPTION AGREEMENT
TO: Cryopak Industries Inc. (the "Company")
0000 Xxxxxxx Xxx, Xxxxxxx Xxxxxx
Xxxxx, Xxxxxxx Xxxxxxxx X0X 0X0 Xxxxxx
1. Subscription
1.1 The undersigned (the "Subscriber") hereby irrevocably subscribes for and
agrees to purchase 1,500,000 common shares in the capital of the Company (the
"Shares" or the "Securities") at a price of CDN$0.80 per Share (such
subscription and agreement to purchase being the "Subscription"), for the total
purchase price of CDN$1,200,000 (the "Subscription Proceeds"), which is to be
tendered at the Closing (as hereafter defined), on the basis of the
representations and warranties and subject to the terms and conditions set forth
herein.
1.2 This Subscription comprises the entire current offering (the "Offering") of
CDN$1,200,000.
1.3 The Company hereby irrevocably agrees to sell, on the basis of the
representations and warranties and subject to the terms and conditions set forth
herein, to the Subscriber the Securities.
1.4 Subject to the terms hereof, the Subscription will be effective upon its
acceptance by the Company.
2. Payment
2.1 The Subscription Proceeds shall be paid at the Closing by wire transfer or
by certified cheque or bank draft, drawn on a Canadian, U.S. or any other
chartered bank acceptable to the Company, made payable to the Company.
3. Documents Required from Subscriber
3.1 The Subscriber must complete, sign and return to the Company the following
documents:
(a) two (2) executed copies of this Subscription Agreement.
3.2 The Subscriber shall complete, sign and return to the Company as soon as
possible, on request by the Company, any documents, questionnaires, notices and
undertakings as may be required by regulatory authorities, stock exchanges and
applicable law.
4. Closing
4.1 Closing of the Offering (the "Closing") shall occur on the date of execution
of this Agreement (the "Closing Date") and, unless otherwise agreed, shall take
place at the offices of the Company's legal counsel, Xxxxxxx Xxxxxxxx Xxxxxxx,
at 11:00 am (local time).
5. Acknowledgements of Subscriber
5.1 The Subscriber acknowledges and agrees that:
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(a) no prospectus has been filed by the Company with the British
Columbia Securities Commission in connection with the issuance of
the Securities, the issuance is exempted from the prospectus
requirement of the Securities Act (British Columbia) R.S.B.C. 1996,
c.418 (the "B.C. Act") or any regulations (the "B.C. Regulations")
promulgated pursuant to the B.C. Act and that:
(i) the Subscriber is restricted from using most of the civil
remedies available under the B.C. Act and the B.C.
Regulations;
(ii) the Subscriber may not receive information that would
otherwise be required to be provided to the Subscriber under
the B.C. Act and the B.C. Regulations; and
(iii) the Company is relieved from certain obligations that would
otherwise apply under the B.C. Act and the B.C. Regulations;
(b) none of the Securities have been registered under the 1933 Act, or
under any state securities or "blue sky" laws of any state of the
United States, and, unless so registered, may not be offered or sold
in the United States or, directly or indirectly, to U.S. Persons, as
that term is defined in Regulation S under the 1933 Act ("Regulation
S"), except pursuant to an effective registration statement under
the 1933 Act, or pursuant to an exemption from, or in a transaction
not subject to, the registration requirements of the 1933 Act;
(c) the Subscriber acknowledges that the Company has not undertaken, and
will have no obligation, to register any of the Securities under the
1933 Act;
(d) there are other restrictions on the Subscriber's ability to resell
the Securities and it is the responsibility of the Subscriber to
find out what those restrictions are and to comply with them before
selling the Securities;
(e) the Subscriber has been advised to consult the Subscriber's own
legal, tax and other advisors with respect to the merits and risks
of an investment in the Securities and with respect to applicable
resale restrictions and the Subscriber is solely responsible (and
the Company is not in any way responsible) for compliance with
applicable resale restrictions;
(f) the Subscriber and the Subscriber's advisor(s) have had a reasonable
opportunity to ask questions of and receive answers from the Company
regarding the Offering, and to obtain additional information, to the
extent possessed or obtainable without unreasonable effort or
expense, necessary to verify the accuracy of the information
contained in any business plan, corporate profile or any other
document provided to the Subscriber;
(g) the books and records of the Company were available upon reasonable
notice for inspection, subject to certain confidentiality
restrictions, by the Subscriber during reasonable business hours at
its principal place of business and that all documents, records and
books pertaining to this Offering have been made available for
inspection by the Subscriber, the Subscriber's attorney and/or
advisor(s);
(h) all information which the Subscriber has provided to the Company
herein concerning itself, its investor status, financial position,
and knowledge and experience of financial and business matters is
correct and complete as of the date of this Agreement, and if there
should be any change in such information prior to the Subscription
being accepted by the Company, the Subscriber will immediately
provide the Company with such information;
(i) the Company is entitled to rely on the representations and
warranties and the statements and answers of the Subscriber
contained in this Subscription Agreement, and the Subscriber will
hold harmless the Company from any loss or damage it may suffer as a
result of the Subscriber's failure to correctly complete this
Subscription Agreement;
(j) the Subscriber will indemnify and hold harmless the Company and,
where applicable, its respective 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 claim, lawsuit, administrative proceeding or
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investigation whether commenced or threatened) arising out of or
based upon any representation or warranty of the Subscriber
contained herein or in any document furnished by the Subscriber to
the Company in connection herewith being untrue in any material
respect or any breach or failure by the Subscriber to comply with
any covenant or agreement made by the Subscriber to the Company in
connection therewith;
(k) by execution hereof the Subscriber has waived the need for the
Company to communicate its acceptance of the purchase of the
Securities pursuant to this Subscription Agreement;
(l) the right is reserved to the directors of the Company to close the
subscription books at any time without notice and for any reason
whatsoever and that this Subscription may be accepted or rejected in
whole but not in part;
(m) the issuance and sale of the Securities to the Subscriber will not
be completed if it would be unlawful or if, in the discretion of the
Company acting reasonably, it is not in the best interests of the
Company;
(n) neither the United States Securities and Exchange Commission nor the
British Columbia Securities Commission or any other securities
commission or similar regulatory authority has reviewed or passed on
the merits of the Securities or the accuracy or adequacy of this
document;
(o) there is no government or other insurance covering any of the
Securities;
(p) the Company has advised the Subscriber that the Company is relying
on an exemption from the requirements to provide the Subscriber with
a prospectus and to sell the Securities through a person registered
to sell securities under the B.C. Act and, as a consequence of
acquiring the Securities pursuant to such exemption certain
protections, rights and remedies provided by the securities
legislation of British Columbia or other relevant jurisdictions,
including statutory rights of rescission or damages, will not be
available to the Subscriber; and
(q) this Subscription Agreement is not enforceable by the Subscriber
unless it has been accepted by the Company.
6. Representations, Warranties and Covenants of the Subscriber
6.1 The Subscriber hereby represents and warrants to and covenants with the
Company (which representations, warranties and covenants shall survive the
Closing) that:
(a) the Subscriber is acquiring the Securities as principal for the
Subscriber's own account, 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;
(b) if the Subscriber is acquiring the Securities as a fiduciary or
agent for one or more investor accounts, the Subscriber has sole
investment discretion with respect to each such account and the
Subscriber has full power to make the foregoing acknowledgements,
representations and agreements on behalf of such account;
(c) the residence of the Subscriber set forth on the execution page
hereof is the true and correct residence of the Subscriber and he
has no present intention to become resident or domiciled in any
other province, state or other jurisdiction;
(d) should there be any change in any of the information which the
Subscriber has provided to the Company prior to the acceptance by
the Company of this subscription, the Subscriber will immediately
provide such information to the Company by telephone prior to such
acceptance and will confirm such information in writing;
(e) the Subscriber, if an individual, has attained the age of majority
and has the legal capacity and competence to enter into and execute
this Subscription Agreement and to take all actions required
pursuant hereto and, if the Subscriber is a corporation, it is duly
incorporated and validly subsisting under the laws of its
jurisdiction of incorporation and all necessary approvals by its
directors, shareholders and others have been obtained to authorize
execution and performance of this Subscription Agreement on behalf
of the Subscriber;
-4-
(f) the entering into of this Subscription Agreement and the
transactions contemplated hereby do not result in the violation of
any of the terms and provisions of any law applicable to, or the
constating documents of, the Subscriber or of any agreement, written
or oral, to which the Subscriber may be a party or by which the
Subscriber is or may be bound;
(g) the Subscriber has duly executed and delivered this Subscription
Agreement and it constitutes a valid and binding agreement of the
Subscriber enforceable against the Subscriber;
(h) the Subscriber is aware that an investment in the Company is
speculative and involves certain risks, including the possible loss
of the investment;
(i) the Subscriber, together with his advisor(s), if any, has the
requisite knowledge and experience in financial and business matters
as to be capable of evaluating the merits and risks of the
investment in the Securities and the Company;
(j) the Subscriber (1) has adequate net worth and means of providing for
its current financial needs and possible personal contingencies, (2)
has no need for liquidity in this investment, and (3) is able to
bear the economic risks of an investment in the Securities for an
indefinite period of time;
(k) the Subscriber has made an independent examination and investigation
of an investment in the Securities and the Company and has depended
on the advice of his legal and financial advisors and agrees that
the Company will not be responsible in anyway whatsoever for the
Subscriber's decision to invest in the Securities and the Company;
(l) the Subscriber is not an underwriter of, or dealer in, the common
shares of the Company, nor is the Subscriber participating, pursuant
to a contractual agreement or otherwise, in the distribution of the
Securities;
(m) the Subscriber understands and agrees that the Company will refuse
to register any transfer of the Securities to a U.S. Person not made
pursuant to an effective registration statement under the 1933 Act
or pursuant to an available exemption from the registration
requirements of the 1933 Act;
(n) the Subscriber understands and agrees that the Company and others
will rely upon the truth and accuracy of the acknowledgments,
representations and agreements contained in sections 5 and 6 hereof
and agrees that if any of such acknowledgments, representations and
agreements are no longer accurate or have been breached, the
Subscriber shall promptly notify the Company;
(o) the Subscriber is not a "control person" of the Company as defined
in the B.C. Act, will not become a "control person" by virtue of
this purchase of the Securities and does not intend to act in
concert with any other person to form a control group;
(p) the Subscriber has no knowledge of a "material fact" or "material
change" (as those terms are defined in the B.C. Act) in the affairs
of the Company that has not been generally disclosed to the public,
save knowledge of this particular transaction;
(q) the Subscriber is not aware of any advertisement of any of the
Securities and is not acquiring the Securities as a result of any
form of general solicitation or general advertising 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; and
(r) no person has made to the Subscriber any written or oral
representations:
(i) that any person will resell or repurchase any of the
Securities;
(ii) that any person will refund the purchase price of any of the
Securities; or
(iii) as to the future price or value of any of the Securities;
-5-
6.2 In this Subscription Agreement, the term "U.S. Person" shall have the
meaning ascribed thereto in Regulation S and for the purpose of the Subscription
includes any person in the United States.
7. Acknowledgement and Waiver
7.1 The Subscriber has acknowledged that the decision to purchase the Securities
was solely made on the basis of publicly available information. The Subscriber
hereby waives, to the fullest extent permitted by law, any rights of withdrawal,
rescission or compensation for damages to which the Subscriber might be entitled
in connection with the distribution of any of the Securities.
8. Resale Restrictions and Registration Rights
8.1 The Subscriber acknowledges that any resale of the Securities will be
subject to resale restrictions contained in all applicable securities
legislation.
8.2 The Subscriber acknowledges that the Securities are being issued pursuant to
prospectus exemptions available under the B.C. Act and have not been registered
under the 1933 Act or the securities laws of any state of the United States and
that the Company does not intend to register same under the 1933 Act, or the
securities laws of any such state and has no obligation to do so, except as
hereafter provided. The Securities may not be offered or sold in the United
States unless the Securities are registered in accordance with the 1933 Act and
all applicable state securities laws or exemptions from such registration
requirements are available. The Securities may not be offered or sold in British
Columbia unless a prospectus with respect to the Securities has been filed or
exemptions from such prospectus requirements are available.
8.3 Unless the Subscriber is otherwise exempted under the B.C. Act or the B.C.
Regulations and the applicable rules or policies of the TSX Venture Exchange
(the "Exchange"), the Securities must be unconditionally held for a period of
four (4) months from the Closing Date and may thereafter be subject to
restrictions or notice requirements under the B.C. Act or B.C. Regulations upon
disposition (ie. if the Subscriber is a control person as defined under the B.C.
Act at the time of a proposed sale of the Securities).
8.4.1 If the Company shall receive from the Subscriber or Andell Holdings LLC or
an affiliate of any of the foregoing (each a "Holder") at any time from and
after February 28, 2003 a prior written request of at least 45 days that the
Company effect any United States registration with respect to all or part of the
Shares or all or any part of the common shares of the Company acquired by the
Subscriber or Andell Holdings LLC from the Company in 2002 (including any common
shares acquired pursuant to the exercise of any warrants acquired by the
Subscriber or Andell Holdings LLC from the Company in 2002) then held by any
such party or any shares of the Company issued as a dividend or other
distribution with respect to, or in exchange for or in replacement of the
foregoing shares (all such shares hereafter collectively called the
"Registerable Shares"), the Company will, as soon as practicable after such 45
day period, use its diligent best efforts to effect such registration
(including, without limitation, the execution of an undertaking to file
post-effective amendments, appropriate qualification under applicable blue sky
or other State securities laws and appropriate compliance with applicable
regulations issued under the Securities Act of 1933), as may be so requested and
as would permit or facilitate the sale or distribution of all or such portion of
the Registerable Shares held by the Holder as are specified in the request of
such Holder; PROVIDED HOWEVER that the fair market value of such shares be no
less than $1,000,000 at the time of such request. The Company shall not,
however, be obligated to effect, or take any action to effect, any such
registration after the Company has effected one such registration and such
registration has been declared or ordered effective.
8.4.2 In the event the Company shall determine to register any of its securities
either for its own account or for the account of any shareholder of the Company,
the Company will promptly give to the Subscriber and Andell Holdings LLC written
notice and shall include in such registration all of the Registerable Shares
specified in a written request made by a Holder within 15 days after receipt of
notice from the Company. In the event any Holder requests inclusion in a
registration in connection with a distribution of Shares to the equity owners of
the Holder, the registration shall provide for resale by such equity owners, if
requested by the Holder.
8.4.3 If the registrations contemplated above are made by means of an
underwriting, the Company shall include the Registerable Shares in the
underwriting, subject to customary cut-back requirements.
8.4.4 In the event that the Company shall proceed to the offering of its common
shares in Canada in lieu of or in conjunction with a registration in the United
States, the foregoing Registration Rights shall apply to the Canadian offering,
mutatis mutandis, and the Company shall file a prospectus under the laws of the
provinces and territories of Canada in which such offering is to occur and
-6-
receive receipts therefor to ensure that the Holders will be permitted to
legally sell such Registerable Shares to the public under applicable Canadian
securities laws.
8.4.5 The expenses of the registration contemplated above, excluding selling
expenses in respect of the Registerable Shares, shall be borne by the Company.
8.4.6 The Company hereby agrees and covenants to enter into a registration
rights agreement with the Subscriber and Andell Holdings LLC within 30 days from
the date hereof setting forth all of the terms and conditions with respect to
the registration rights hereby granted, which registration rights agreement
shall be substantially in the form attached hereto as Schedule A. In the event
of any conflict between the terms of Schedule A and subsections 8.4.1 through
8.4.4, the terms of Schedule A shall prevail.
9. Legending of Subject Securities
9.1 The Subscriber understands and acknowledges that upon the issuance thereof,
and until such time as the same is no longer required under the applicable
requirements of applicable securities legislation or by the Exchange, the
certificates representing any of the Securities will bear appropriate legends in
order to reflect the non-registration of the Securities under the 1933 Act as
well as all applicable hold periods and restrictions on resale of the
Securities.
9.2 The Subscriber hereby acknowledges and agrees to the Company making a
notation on its records or giving instructions to the registrar and transfer
agent of the Company in order to implement the restrictions on transfer set
forth and described in this Subscription Agreement.
10. Representations and Warranties of the Company
10.1 The Company represents and warrants to the Subscriber that:
(a) it is a reporting issuer duly organized and validly existing under
the laws of its jurisdiction of incorporation, amalgamation or
continuance, it is in good standing with the corporate governmental
authorities of such jurisdiction with respect to the filing of
annual returns and such other filings as are necessary to maintain
its corporate existence and it has full corporate power to conduct
its business as such business is now being conducted;
(b) there are no claims, actions, suits, judgments, or proceedings
pending against or affecting the Company which will or may have a
material adverse effect upon the Company, nor does it know of any
reasonable ground for any such claims, actions, suits, judgments or
proceedings;
(c) it has the full power and authority to enter into and to perform
this Subscription Agreement and to do all other acts which may be
necessary to consummate the transactions contemplated hereby,
subject to all applicable securities laws;
(d) the issue of the Shares has been approved by all requisite corporate
action and the Shares have been validly issued as fully paid and
non-assessable;
(e) the Exchange has approved the issuance of the Securities and the
listing thereof and the issuance of the Securities is exempt from
registration and prospectus requirements under the B.C. Act and B.C.
Regulations.
(f) The Company has not sustained, since September 30, 2002, being the
date of its latest quarterly financial statements, any material loss
or interference with its business from fire, explosion, flood or
other calamity, whether or not covered by insurance, or from any
labour dispute or court or governmental action, order or decree or
from any regulatory body having jurisdiction. Since September 30,
2002: (i) there has not been any change in the authorized share
capital of the Company, (ii) the Company has not incurred any
liabilities or obligations (absolute, accrued, contingent or
otherwise) or entered into any transactions not in the ordinary
course of business that are material to the Company; and (iii) there
has not been any material adverse change, or any development
involving a prospective material adverse change (including
prospective material adverse changes or, to the best of the
Company's
-7-
knowledge, threatened claims or contingent liabilities), in or
affecting the general affairs, management, financial position,
shareholders' equity or results of operations of the Company.
(g) The Company has good and marketable title to all movable property
owned by it which is material, individually or in the aggregate, to
the Company. Any real property held under lease by the Company,
which is material, individually or in the aggregate, to the Company
is held by it under valid, subsisting and enforceable leases with
such exceptions as are not material, individually or in the
aggregate, to the Company.
(h) The Company: (a) has been duly incorporated, organized and is
validly existing as a company in good standing under the laws of its
jurisdiction of incorporation, with corporate power and authority to
own, lease and operate its property and assets, to conduct its
business as now conducted and as currently proposed to be conducted
and to carry out the provisions hereof; and (b) where required, has
been duly qualified as an extra-provincial or foreign corporation
for the transaction of business and is in good standing under the
laws of each other jurisdiction in which it owns or leases
properties, or conducts any business.
(i) There are 29,901,054 common shares issued and outstanding, all of
which have been duly authorized and validly issued as fully paid and
non-assessable (and no others). There are no outstanding
subscriptions, warrants, options, agreements, convertible or
exchangeable securities or other commitments pursuant to which the
Company is or may become obligated to issue, sell, purchase, return
or redeem any shares of capital stock or other securities of the
Company, other than those set out below:
(i) Incentive Stock Options 4,746,000
(ii) Convertible Debenture 1,212,500
(iii) Earn-out Shares 2,700,000
(iv) This Subscription 1,500,000
(v) Cashless Stock Options (Xxxxxx Securities) 300,000
(j) All necessary corporate action has been taken by the Company to
authorize the issuance of the Shares. The Shares have been issued as
fully paid and non-assessable.
(k) The Company has no material subsidiaries, as such term is defined in
the Canada Business Corporations Act, except as disclosed in the
Company's Annual Information Form dated December 31, 2002 which has
been duly filed with the British Columbia Securities Commission and
the TSX Venture Exchange.
(l) The Company is a reporting issuer under the laws of Alberta and
British Columbia and is in good standing as a reporting issuer or is
not on the list of defaulting issuers maintained pursuant to
securities laws of the said provinces. As at the Closing Date, the
Company is a "Qualifying Issuer", as such term is defined in the
Multi-Lateral Instrument 45-102, under applicable securities
legislation in Alberta and British Columbia.
(m) The Company is a "foreign private issuer" as defined in Rule 3b-4(c)
under the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), and has filed with the United States Securities Exchange
Commission (the "SEC") all forms, reports, schedules and other
information (collectively, the "SEC Reports") required to be filed
by it with the SEC. The SEC Reports (i) complied as to form in all
material respects with the applicable requirements of the 1933 Act,
as amended, or the Exchange Act, and the respective rules and
regulations thereunder as in effect at the time they were filed and
(ii) did not at the time they were filed contain any untrue
statement of a material fact or omit to state a material fact
required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which
they were made, not misleading.
(n) The Company is not in violation of its constating documents, by-laws
or resolutions of its directors or shareholders or in default in the
performance of any indenture, mortgage, deed of trust, loan
agreement, lease or other agreement or instrument to which it is a
party or by which it is bound or to which any of its property or
assets is subject, which
-8-
violation, default or defaults, individually or in the aggregate,
would have a material adverse effect on the financial position,
business, affairs, prospects, shareholders' equity or results of
operations of the Company. The compliance by the Company with all of
the provisions of this Agreement, the Shares, and the consummation
of the transactions contemplated therein:
(i) will not conflict with or result in a breach or violation of
any of the terms or provisions of, or constitute a default
under, or result in the creation or imposition of any lien,
charge or encumbrance on any of the property or assets of the
Company pursuant to the terms of any indenture, mortgage, deed
of trust, loan agreement, lease or other agreement or
instrument to which the Company is a party or by which the
Company is bound or to which any of the property or assets of
the Company are subject;
(ii) will not result in any violation of any of the terms or
provisions of the constating documents, by-laws or resolutions
of the directors or shareholders of the Company; and
(iii) will not result in any violation of any statute or any order,
rule or regulation of any court or governmental agency or body
having jurisdiction over the Company or any of its properties;
other than, in the case of clauses (i) and (iii) above, any breach,
default, violation or conflict which, individually or in the
aggregate, will not have a material adverse effect on the business,
affairs, prospects, financial position, shareholders' equity or
results of operations of the Company.
(o) All consents, approvals, permits, authorizations or filings as may
be required under United States and Canadian Securities Laws and the
rules of the Exchange necessary for the execution and delivery of
and the performance by the Company of its obligations under this
Agreement have been made or obtained on the Closing Date, other than
the filing of the requisite distributions reports and related
documents.
(p) As at the Closing Date, no holder of outstanding common shares in
the capital of the Company or other securities of the Company will
be entitled to any preemptive or any similar rights to subscribe for
or otherwise acquire any of the Shares, Underlying Shares or other
securities of the Company, and except as contemplated by this
Agreement and except as has been publicly disclosed by the Company,
no rights, warrants or options (other than under Company's stock
option plan) to acquire, or instruments convertible into or
exchangeable for any shares in the capital of the Company are
outstanding.
(q) The Company has not been served with or otherwise received notice of
any legal or governmental proceedings and there are no legal or
governmental proceedings pending to which the Company is a party or
of which any property or assets of the Company is the subject which
is reasonably likely, individually or in the aggregate, to have a
material adverse effect on the business, affairs, prospects,
financial position, shareholders' equity or results of operations of
the Company, or which might reasonably be expected to materially and
adversely affect the consummation by the Company of the transactions
contemplated by this Agreement. To the best of the Company's
knowledge, no such proceedings have been threatened (implicitly or
otherwise) or contemplated against the Company by governmental or
regulatory authorities or any other parties.
(r) The Company holds all of the permits, licenses and like
authorizations necessary for it to carry on its business in each
jurisdiction where such business is carried on. Each of such
permits, licenses and like authorizations is in good standing and
the Company is not in default with respect to filings to be effected
or conditions to be fulfilled in order to maintain such permits,
licenses or like authorizations in good standing, except where the
failure to hold any such permit, license or authorization or default
does not have a material adverse effect on the business, affairs,
prospects, financial position, shareholders' equity or results of
operations of the Company.
(s) The Company is not in violation of any law, ordinance,
administrative or governmental rule or regulation or court decree
applicable to it, nor is it not in compliance with any term or
condition of, nor has it failed to obtain, any license, permit,
franchise or other administrative or governmental authorization
necessary to the ownership of its property or to the conduct of its
business, which violation, non-compliance or failure to obtain
would, individually or in the aggregate, have a material adverse
effect on the business, affairs, prospects, financial position,
shareholders' equity or results of operations of the Company or
which might reasonably be expected to materially
-9-
and adversely affect the consummation by the Company of the
transactions contemplated by this Agreement. All such licences,
permits, franchises or other administrative or governmental
authorizations are valid and subsisting and in good standing and
none of the same contains any term, provision, condition or
limitation which has or would reasonably be expected to affect or
restrict in a materially adverse manner the operation of the
business of the Company, as now carried on or proposed to be carried
on. The Company is not aware of any legislation, regulations or
proposed legislative or regulatory changes which would materially
and adversely affect the business, prospects or operations of the
Company or the financial position, shareholders' equity or results
of operations of the Company.
(t) There are no outstanding obligations for the Company to purchase or
redeem any shares or other securities of the Company, except as
conditionally provided in the agreement with Xxxxx Xxxxx dated
January 24, 2003.
(u) Each of the Agreement and the Shares has been duly and validly
authorized, executed and delivered by the Company and constitutes a
valid and binding obligation of the Company enforceable against it
in accordance with its terms, subject to the qualification that
enforcement thereof is subject to applicable bankruptcy, insolvency,
reorganization or other laws affecting credits' rights generally.
(v) The financial statements of the Company for the fiscal year ended
March 31, 2002 are true and correct in all material respects and the
quarterly financial statements of the Company issued thereafter are
true and correct in all material respects, present fairly the
financial position and condition of the Company as at the dates
indicated and the results of its operations for the periods
specified, reflect all material liabilities (absolute, accrued,
contingent or otherwise) of the Company as at the dates indicated
and have been prepared in conformity with generally accepted
accounting principles in Canada applied on a consistent basis.
(w) There is no person, firm or corporation acting or purporting to be
acting for the Company entitled to any commission, brokerage or
finder's fee payable by or on behalf of the Company in connection
with this Agreement or any of the transactions contemplated
hereunder.
(x) With such exceptions as are not material to the Company: (a) the
Company has duly and on a timely basis filed all tax returns
required to be filed by it, has paid all taxes due and payable by it
and has paid all assessments and reassessments and all other taxes,
governmental charges, penalties, interest and other fines due and
payable by it and which are claimed by any governmental authority to
be due and owing and adequate provision has been made for taxes
payable for any completed fiscal period for which tax returns are
not yet required to be filed; and (b) there are no agreements,
waivers or other arrangements providing for an extension of time
with respect to the filing of any tax return or payment of any tax,
governmental charge or deficiency by the Company; (c) to the
knowledge of the Company, there are no actions, suits, proceedings,
investigations or claims threatened or pending against the Company
in respect of taxes, governmental charges or assessments; and (d)
there are no matters under discussion with any governmental
authority relating to taxes, governmental charges or assessments
asserted by any such authority.
(y) The Company is not aware of any claim of infringement or breach by
the Company of any patent, industrial or intellectual property
rights of any other person, nor has the Company received any notice
nor is the Company aware that the use of the business names,
trademarks, service marks and other patent, industrial or
intellectual property of the Company infringes upon or breaches any
industrial or intellectual property rights of any other person,
except the following:
(i) A complaint was received in or about 1996 from the owner of
the "Cryovac" trademark, alleging infringement by the Company
and demanding that the Company cease and desist the use of
"Cryopak". The Company responded and denied the infringement.
No infringement action has been instituted. In or about 1998,
the same party opposed the registration of the "Cryopak"
trademark in the European community (application number
141234). The Company won in the first instance, but this was
appealed by the other party. The appeal is still in process.
(z) The Company owns or possesses adequate enforceable rights to use all
patents, trademarks, service marks, copyrights and trade secrets and
other industrial and intellectual property rights, used or proposed
to be used in the conduct of its business and material thereto
including, without limiting the generality of the foregoing, U.S.
Patent
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No. 4,931,333 entitled THERMAL PACKAGING ASSEMBLY and Canadian
Patent No. 1,291,073 entitled THERMAL PACKAGING ASSEMBLY.
(aa) The Securities Law Reports, being the most recently filed Form 20F,
Annual Information Form, quarterly and annual financial statements
and other information filed in accordance with Canadian and U.S.
securities laws, were, on the dates of their respective filings, in
compliance in all material respects with the requirements of their
respective report forms and the Canadian and U.S. Securities Laws
and did not, on the date of filing, contain any untrue statement of
a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein, in the
light of the circumstances under which they were made, not
misleading. There have not been any material adverse changes to the
assets, liabilities, financial position or business of the Company
or any of its material subsidiaries since the filing of the
Securities Law Reports and no transaction has been entered into by
the Company or any material subsidiary which is or may be material
to the Company on a consolidated basis.
11. Adjustment to Subscription
11.1 The number of Securities to be issued pursuant to this Subscription will be
subject to adjustment in the event and in the manner following:
(a) if and whenever the shares at any time outstanding are subdivided
into a greater or consolidated into a lesser number of shares, the
price per Share under the Subscription will be decreased or
increased proportionately as the case may be; and upon any such
subdivision or consolidation the number of Shares deliverable
pursuant to the Subscription will be increased or decreased
proportionately as the case may be;
(b) in case of any capital reorganization or of any reclassification of
the capital of the Company or in the case of the consolidation,
merger or amalgamation of the Company with or into any other company
(hereinafter collectively referred to as a "Reorganization"), the
number of Shares deliverable pursuant to the Subscription will be
the equivalent number of shares or other securities of the Company
(or of the Company resulting from such Reorganization); and
(c) the subdivision or consolidation of shares at any time outstanding
into a greater or lesser number of shares (whether with or without
par value) will not be deemed to be a Reorganization for the
purposes of this paragraph 11.
11.2 If any questions will at any time arise with respect to the price per share
of the Subscription or any adjustment provided for in paragraph 11.1, such
question will be conclusively determined by the Company's auditors, or, if they
decline to so act, any other firm of independent accountants, in Vancouver,
British Columbia, that the Company may designate and who will have access to all
appropriate records and such determination will be binding upon the Company and
the holder of the Subscription.
12. Closing
12.1 At the Closing, as provided in paragraph 4.1 hereof, the Company shall
cause certificates representing the Securities hereby subscribed for to be
forthwith delivered to the Subscriber against payment of the Subscription
Proceeds. The warranties of the Subscriber and of the Company herein shall
survive the closing hereof.
13. Further Acts
13.1 The Subscriber shall execute such other documents as may be required to
give effect to the intent of this Subscription Agreement including any
questionnaires, undertakings and acknowledgements of the Exchange and the
British Columbia Securities Commission.
14. Governing Law
14.1 This Agreement shall be governed by and construed in accordance with the
laws of the Province of British Columbia and the federal laws of Canada
applicable therein, and the parties hereto agree to attorn to the exclusive
jurisdiction of the courts of British Columbia.
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15. Costs
15.1 The Company agrees to pay all reasonable costs and expenses incurred by the
Subscriber (including all reasonable fees and disbursements of the Subscriber's
legal counsel) relating to the purchase of the Securities by the Subscriber.
16. Survival
16.1 This Subscription 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 hereto
notwithstanding the completion of the purchase of the Securities by the
Subscriber pursuant hereto.
17. Withdrawal & Assignment
17.1 This Subscription Agreement has been entered into by the Subscriber for
valuable consideration and shall not be withdrawn or revoked by the Subscriber
and shall not be assignable by the Subscriber without the written consent of the
Company which consent may be unreasonably withheld.
18. Execution
18.1 The Company shall be entitled to rely on delivery by facsimile machine of
an executed copy of this Subscription 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.
19. Severability
19.1 The invalidity or unenforceability of any particular provision of this
Subscription Agreement shall not affect or limit the validity or enforceability
of the remaining provisions of this Subscription Agreement.
20. Entire Agreement
20.1 Except as expressly provided in this Subscription Agreement and in the
agreements, instruments and other documents contemplated or provided for herein,
this Subscription Agreement contains the entire agreement between the parties
with respect to the sale of the Securities and there are no other terms,
conditions, representations or warranties, whether expressed, implied, oral or
written, by statute or common law, by the Company or by anyone else.
21. Notice
21.1 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 fax or by delivery to the parties at the addresses as set
out in this Subscription Agreement. Any notice or other communication:
(a) mailed shall be deemed to have been received on the fifth business
day following its mailing;
(b) faxed shall be deemed to have been received on the business day
following the date of transmission; and
(c) delivered shall be deemed to have been received on the date of
delivery.
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.
22. Miscellaneous
22.1 This Subscription Agreement may be executed in any number of counterparts,
each of which, when so executed and delivered, shall constitute an original and
all of which together shall constitute one instrument.
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22.2 The Agreement shall enure to the benefit of and is binding upon the parties
hereto and their respective heirs, executors, administrators, successors and
permitted assigns.
22.3 Time is of the essence hereof.
22.4 This Agreement is dated for reference the last day of execution by a party.
23. Language
23.1 The parties hereto confirm their express wish that this Agreement and all
documents and agreements directly or indirectly relating thereto be drawn up in
the English language.
23.2 Les parties reconnaissent leur volonte expresse que la presente convention
ainsi que tous les documents et contrats s'y rattachant directement ou
indirectement soient rediges en anglais.
IN WITNESS WHEREOF the Subscriber has duly executed this Subscription Agreement.
Number of Shares to be purchased: 1,500,000
Total Subscription Proceeds: CDN$1,200,000
____________________________________________________
(Name of Subscriber - Please type or print)
____________________________________________________
(Signature and, if applicable, Office)
____________________________________________________
(Address and Residence of Subscriber)
____________________________________________________
(City, State or Province, Postal Code of Subscriber)
____________________________________________________
(Country of Subscriber)
____________________________________________________
(Date of Execution)
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A C C E P T A N C E
The above-mentioned Subscription Agreement in respect of the Securities is
hereby accepted by Cryopak Industries Inc.
DATED at _______________________________ , the __________ day of ________, 2003.
Cryopak Industries Inc.
Per: _____________________________________
Xxxx Xxxx, CFO
