EXHIBIT 2.5
THE SECURITIES TO WHICH THIS PRIVATE PLACEMENT SUBSCRIPTION AGREEMENT (THE
"AGREEMENT") RELATES HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE UNITED
STATES SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR THE SECURITIES
LAWS OF ANY STATE OF THE UNITED STATES AND MAY NOT BE OFFERED OR SOLD OR
OTHERWISE TRANSFERRED IN THE UNITED STATES OR TO A U.S. PERSON UNLESS SUCH
SECURITIES ARE REGISTERED UNDER THE 1933 ACT AND APPLICABLE STATE SECURITIES
LAWS OR UNLESS AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS THEREOF IS
AVAILABLE. "UNITED STATES" AND "U.S. PERSON" ARE AS DEFINED BY REGULATION S
UNDER THE 1933 ACT.
FORM OF SUBSCRIPTION AGREEMENT
------------------------------
TO: LML PAYMENT SYSTEMS INC.
(the "Company")
0000 Xxxxxxxxxx Xxxxx, X.
Xxxxx 000
Xxxxxxxxxxxx, XX 00000
With a business address at:
0000 - 0000 Xxxx Xxxxxx Xxxxxx
Xxxxxxxxx, X.X.
X0X 0X0
1. The undersigned purchaser (the "Purchaser") hereby subscribes for and
agrees to purchase _______ shares in the capital of the Company (the "Shares")
at the price of U.S.$5.00 per Share, for the total purchase price of
U.S.$_________ (the "Funds"), which is tendered herewith. This subscription is
part of a private placement of up to U.S.$5,000,000 (the "Private Placement"). A
minimum subscription of CDN.$97,000 (approximately U.S.$66,000 based on current
exchange rates) is required.
2. The Purchaser acknowledges that the Company will pay a finder's fee of
ten percent (10%) of the Funds (and other funds forming part of this Private
Placement) to ____________ (the "Finder") in connection with this subscription
and the other subscriptions forming part of the Private Placement. The finder's
fee will be paid in such number of Shares as shall be equal to the amount of the
finder's fee divided by a deemed issue price of U.S.$5.00 per Share.
3. The Purchaser undertakes not to sell or otherwise dispose of any of the
said securities so purchased or any securities derived therefrom in British
Columbia for a period of twelve months from the date of issue thereof (the "B.C.
Hold Period"), except pursuant to an exemption from prospectus requirements.
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4. The Purchaser confirms that:
(a) the decision to subscribe for the Shares was not made as a result of
any material information about the Company's affairs that had not been
publicly disclosed; and
(b) the sale of the Shares has not been accompanied by an advertisement.
5. The Purchaser acknowledges that:
(a) the Shares will be sold under an exemption from the prospectus
requirements set out in Section 74(2)(4) of the British Columbia
Securities Act (the "B.C. Act") and with respect to the sale of the
Shares, represents and warrants to the Company that the Purchaser is
purchasing the Shares as principal;
(b) the Purchaser is purchasing the Shares pursuant to an exemption under
the B.C. Act on the basis that the Purchaser is sophisticated and, as
a consequence:
(i) is restricted from using most of the civil remedies available
under securities legislation,
(ii) may not receive information that would otherwise be required to
be provided to him under securities legislation, and
(iii) the Company is relieved from certain obligations that would
otherwise apply under securities legislation;
(c) the Shares are being purchased by the Purchaser as principal for
investment only and not with a view to the distribution thereof, and
the Purchaser is not participating directly or indirectly in any
underwriting of the Shares;
(d) the Shares have not been and will not be registered under the United
States Securities Act of 1933, as amended (the "1933 Act"), and may
not be offered or sold in the United States or to any U.S. Person (as
such term is defined in Rule 902 of Regulation S of the 0000 Xxx)
unless such securities have been registered under the 1933 Act or an
exemption from the registration requirements thereof is available;
(e) the Purchaser is a partnership or corporation, it is organized under
the laws of the jurisdiction of the British Virgin Islands and has not
been formed by a U.S. Person principally for the purpose of investing
in securities not registered under the 1933 Act. In addition, the
Purchaser (i)
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is not (and is not purchasing the Shares for the account or benefit
of) a U.S. Person, (ii) was not offered the Shares in the United
States, and (iii) did not execute or deliver this Agreement in the
United States;
(f) the Purchaser agrees not to offer, sell or transfer any Shares during
the 40 day period commencing after the later of (i) the date the
Shares were first offered to persons other than distributors in
reliance on Regulation S under the 1933 Act or (ii) the closing of the
transaction contemplated hereby, except in compliance with Rule 903 or
Rule 904 of Regulation S under the 1933 Act. The Purchaser
acknowledges that the Company will place a legend to such effect on
the securities and may institute such other procedures to assure
compliance with the foregoing requirements, including, without
limitation, requiring the Purchaser to establish that a transferee of
any of the Shares during any restricted period is not a U.S. person
and the offer and sale was not made in the United States;
(g) the Purchaser has received and reviewed the public information with
respect to the Company and has had an opportunity to ask questions of,
and receive answers from persons acting on behalf of the Company;
(h) the Company will not be required to place a legend regarding the B.C.
Hold Period on certificates representing the Shares provided that the
Purchaser shall file an Initial Trade Report in the form attached as
Schedule "A" hereto, as prescribed by Blanket Order #95/17 of the
British Columbia Securities Commission, within 10 days from the date
of the beginning of the distribution by such purchaser.
6. The Purchaser warrants that it is acquiring the Shares under
exemptions from securities filing requirements in its jurisdiction of domicile.
7. Upon acceptance of this subscription the Company will promptly take
the necessary steps to have the Shares issued and allotted as fully paid and
non-assessable.
8. This Agreement is to be governed and interpreted according to the laws
of the Province of British Columbia.
9. This Agreement may be executed in counterpart and such counterparts
together shall constitute one and the same instrument.
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10. Delivery of an executed copy of this Agreement by telecopy, telex or
other means of electronic communication producing a printed copy will be deemed
to be execution and delivery of this Agreement on the date of such communication
by the party so delivering such copy.
DATED this __________ day of ___________, 1999.
___________________________________
Signature of Subscriber
___________________________________
Subscriber's Name
___________________________________
Complete Mailing Address
___________________________________
___________________________________
The Company accepts the subscription
set forth above this _____ day of
__________, 1999.
LML PAYMENT SYSTEMS INC.
________________________
Director
Schedule "A"
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Securities Act
INITIAL TRADE REPORT
1. Name and address of seller
____________________________________________________________________________
____________________________________________________________________________
2. Name and address of the issuer whose securities were traded by the seller
____________________________________________________________________________
____________________________________________________________________________
3. Name and address of the party from whom the seller acquired the securities
____________________________________________________________________________
____________________________________________________________________________
4. Description of securities sold
(a) Number and description of securities ____________________
(b) Date of acquisition of securities by the seller ____________________
(c) Exemption under which securities were
acquired by the seller ____________________
(d) Exemption under which securities were
traded by the seller ____________________
(e) Date of sale of securities ____________________
(f) Sale Price ____________________
5. Certificate of seller
The undersigned seller hereby certifies that the information given in this
report relating to the seller is true and that, to the best of the seller's
information and belief,
(a) the information given in this report relating to any other party is
true,
(b) no unusual effort has been made to prepare the market or create a
demand for the securities, and
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(c) no extraordinary commission or other consideration has been paid in
respect of the trade to which this report relates.
DATED at ____________this________day of ____________,________
______________________________________________
Signature of the seller or, if the seller is a
company, signature of authorized signatory
______________________________________________
Name of the seller or, if the seller is a
company, name and office of authorized
signatory
INSTRUCTIONS:
1. If the space provided for any answer is insufficient, additional sheets
may be used. Each sheet must be cross-referenced to the relevant item,
properly identified and signed by the person whose signature appears on
the report.
2. File this report with the required fee and completed Fee Checklist. In
order to determine the fee payable, consult section 22 of the Securities
Regulation, B.C. Reg. 478/95. Cheques should be made payable to the
"British Columbia Securities Commission".
IT IS AN OFFENCE FOR A PERSON TO MAKE A STATEMENT IN A DOCUMENT REQUIRED TO BE
FILED OR FURNISHED UNDER THE SECURITIES ACT THAT, AT THE TIME AND IN LIGHT OF
CIRCUMSTANCES UNDER WHICH IT IS MADE, IS A MISREPRESENTATION
