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EXHIBIT 10.1
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AGENCY AGREEMENT -- SPECIAL WARRANT PRIVATE PLACEMENT
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THIS AGREEMENT dated for reference June 8, 1999, is made
BETWEEN
GENETRONICS BIOMEDICAL LTD., Xxxxx 000, 000 Xxxxxx Xxxxxx,
Xxxxxxxxx, Xxxxxxx Xxxxxxxx, X0X 0X0
(the "Issuer");
AND
CANACCORD INTERNATIONAL (L) CORPORATION, X.X. Xxx XX 0000,
Xxxxxxxx XX XX, Xxxxxxx
(the "Agent")
WHEREAS:
A. The Issuer wishes to privately place with purchasers up to 4,500,000 Special
Warrants at a price of U.S. $3.00 per Special Warrant;
B. The Issuer wishes to appoint the Agent to distribute the Special Warrants,
and the Agent is willing to accept such appointment on the terms and conditions
of this Agreement;
THE PARTIES to this Agreement therefore agree:
1. DEFINITIONS
1.1 In this Agreement and the Recitals hereto:
(a) "1933 Act" means the Securities Act of 1933 (United States),
as amended;
(b) "1934 Act" means the Securities and Exchange Act of 1934
(United States), as amended;
(c) "Acts" means the Securities Acts or comparable legislation of
the Filing Provinces;
(d) "Agent's Fee" has the meaning defined in Section 4 hereof;
(e) "Agent's Special Warrants" means special warrants of the
Issuer having the terms provided herein and in the
certificates representing such special warrants;
(f) "Agent's Warrants" means share purchase warrants of the Issuer
having the terms provided herein and in the certificates
representing such share purchase warrants;
(g) "Applicable Legislation" means the Acts, the Regulations and
Rules made thereunder, and all Policy Statements, Blanket
Orders and Rulings, Notices and Interpretation Notes and other
administrative policies and directions issued by Commissions;
(h) "Canaccord" means Canaccord Capital Corporation;
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(i) "Closing" means the completion of the purchase and sale of
some or all of the Special Warrants;
(j) "Commissions" means the securities regulatory authorities in
the Filing Provinces;
(k) "Corporate Finance Shares" means 30,000 common shares in the
capital of the Company, as presently constituted;
(l) "Disclosure Record" means all press releases, Material Change
reports, prospectuses, financial statements and other
documents which the Issuer is required to file with the
securities regulatory authorities in those jurisdictions where
it is a "reporting issuer" under the Acts or has equivalent
status as at the date hereof;
(m) "Distribution" means the proposed issuance of Shares to the
holders of the Special Warrants , and Agent's Warrants to the
holders of the Agent's Special Warrants, on the deemed
exercise of the Special Warrants and Agent's Special Warrants,
free of any resale restrictions in the Filing Provinces other
than those imposed on a "control person", as that term is
defined in the Securities Act (British Columbia);
(n) "Exchange" means the Toronto Stock Exchange;
(o) "Exemptions" means exemptions from the prospectus requirements
of the Acts;
(p) "Filing Deadline" means the day the rules and policies of the
Exchange require that the subscription forms and other
documentation in connection with the Private Placement must be
filed with the Exchange, or any extension thereof;
(q) "Filing Provinces" means British Columbia and Ontario;
(r) "Foreign Issuer" has the meaning defined in Rule 405 of the
1933 Act;
(s) "Institutional Accredited Investor" means an institutional
"accredited investor" as defined in Rule 501 of Regulation D;
(t) "Material Change" has the meaning defined in the Acts, as
supplemented by National Policy No. 40;
(u) "Material Fact" has the meaning defined in the Acts;
(v) "Offering Memorandum" has the meaning defined in Applicable
Legislation;
(w) "Misrepresentation" has the meaning defined in the Acts;
(x) "Private Placement" means the offering of the Special Warrants
on the terms and conditions of this Agreement;
(y) "Prospectus" means a preliminary and final prospectus (which
may include a short form prospectus filed under National
Policy 47 of the Canadian Securities Administrators),
including any amendments made thereto, which, upon issuance of
a receipt therefore by the Commissions, will qualify the
Distribution;
(z) "Purchasers" means the purchasers of Special Warrants;
(aa) "Qualification Date" means the date on which a receipt for the
final Prospectus is issued by the last of the Commissions to
do so;
(ab) "Registration Statement" means a registration statement in
compliance with the 1933 Act relating to the Shares;
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(ac) "Regulation D" means Regulation D promulgated under the 1933
Act;
(ad) "Regulation S" means Regulation S promulgated under the 1933
Act;
(ae) "Regulatory Authorities" means the Commissions and the
Exchange;
(af) "Securities" means the Special Warrants, the Agent's Special
Warrants, the Corporate Finance Shares, the Agent's Warrants
and the Shares;
(ag) "Shares" means previously unissued common shares in the
capital of the Issuer, as presently constituted, to be issued
upon the exercise or deemed exercise of the Special Warrants,
and the Agent's Warrants;
(ah) "Special Warrant Indenture" means an indenture to be made
between the Issuer and the Trustee providing for issuance of
the Special Warrants;
(ai) "Special Warrants" means special warrants of the Issuer having
the terms and conditions provided in this Agreement and in the
Special Warrant Indenture;
(ak) "Subsidiary" has the meaning defined in the Securities Act
(British Columbia); and
(al) "Trustee" means Montreal Trust Company of Canada;
1.2 In this Agreement, the following terms have the meanings
defined in Regulation "S":
(a) "Directed Selling Efforts";
(b) "Substantial U.S. Market Interest";
(c) "U.S. Person" and
(d) "United States".
2. APPOINTMENT OF AGENT AND GREENSHOE OPTION
2.1 The Issuer appoints the Agent as its exclusive agent and the Agent accepts
the appointment and agrees to act as the exclusive agent of the Issuer to use
commercially reasonable efforts to find and introduce to the Issuer potential
purchasers to purchase up to 4,500,000 Special Warrants, at a price of U.S.
$3.00 per Special Warrant, by way of sale under the Exemptions.
2.2 The sale of the Special Warrants to the Purchasers will be effected only
pursuant to Exemptions which do not require the delivery or filing of an
Offering Memorandum.
2.3 The Agent may solicit and accept subscriptions for additional Special
Warrants up to a maximum of 15% of the Private Placement (the "Greenshoe
Option").
2.4 The number of additional Special Warrants subject to the Greenshoe Option
will be the lesser of 15% of the Private Placement or the actual number of
additional Special Warrants for which subscriptions have been received.
2.5 On receipt of notice in writing from the Agent given on or before the final
Closing, the Issuer will issue and deliver to the Agent forthwith, at a price of
U.S. $3.00 per Special Warrant, the number of Special Warrants subject to the
Greenshoe Option.
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3. SPECIAL WARRANTS AND AGENT'S SPECIAL WARRANTS
SPECIAL WARRANTS
3.1 The Special Warrants will be issued under and governed by the Special
Warrant Indenture, and will be registered in the names of the Purchasers or
their nominees.
3.2 The Special Warrant Indenture will be satisfactory in form and substance to
the Agent, acting reasonably.
3.3 The Issuer covenants with the Agent, and the Special Warrant Indenture will
provide (among other things):
(a) that each Special Warrant will be exercisable, for no
additional consideration, to acquire one Share;
(b) that the Issuer will use its reasonable best efforts to retain
the listing of its common shares on the Exchange and either or
both of the American Stock Exchange and NASDAQ, during the
term of the Special Warrants and thereafter;
(c) that the Issuer will use its reasonable best efforts to file
and obtain receipts for the preliminary and (final) Prospectus
from the Commissions, and to file the Registration Statement
with the United States Securities and Exchange Commission, and
have the Registration Statement declared effective, as soon as
practicable, and in any event within 90 days from the date of
the first Closing;
(d) that the Special Warrants may be exercised by the holders
thereof in whole or in part at any time after the Closing on
which they are issued. Any unexercised Special Warrants will
be deemed to be exercised on that day which falls on the
earlier of:
(i) the fifth business day after the Qualification Date;
and
(iii) 12 months from the date of the final Closing
(e) that upon exercise or deemed exercise, the Special Warrants
will be automatically cancelled and will have no further force
or effect;
(f) that the Special Warrants will be transferable, subject to
Applicable Legislation and the rules and policies of the
Exchange;
(g) for the appropriate adjustment in the class and number of the
securities to be issued upon exercise of the Special Warrants
upon the occurrence of certain events, including any
subdivision, consolidation or reclassification of the common
shares of the Issuer, the payment of stock dividends and the
amalgamation of the Issuer; and
(h) that the Issuer will use its reasonable best efforts to remain
a "reporting issuer" in the Filing Provinces where it is
presently a reporting issuer, not in default of Applicable
Legislation therein, for one year from the date of the final
Closing;
AGENT'S SPECIAL WARRANTS
3.4 The Agent's Special Warrants will be represented by certificates, and will
be registered in the names of the Agent or as directed by the Agent, subject to
Applicable Legislation.
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3.5 The certificates representing the Agent's Special Warrants will be
satisfactory in form and substance to the Agent, and will provide, among other
things:
(a) that each Agent's Special Warrant will be exercisable, for no
additional consideration, to acquire one Agent's Warrant;
(b) that the Agent's Special Warrants may be exercised by the
holders thereof in whole or in part at any time after the
Closing on which they are issued. Any unexercised Agent's
Special Warrants will be deemed to be exercised on that day
which falls on the earlier of:
(i) the fifth business day after the Qualification Date;
and
(ii) 12 months from the date of the final Closing.
(c) that upon exercise or deemed exercise, the Agent's Special
Warrants will be automatically cancelled and will have no
further force or effect;
(d) that the Agent's Special Warrants will not be transferable,
except as provided by Applicable Legislation or any order
issued by either of the Commissions; and
(e) for the appropriate adjustment in the class and number of the
securities to be issued upon exercise of the Agent's Special
Warrants upon the occurrence of certain events, including any
subdivision, consolidation or reclassification of the common
shares of the Issuer, the payment of stock dividends and the
amalgamation of the Issuer.
AGENT'S WARRANTS
3.6 The Agent's Warrants will be represented by certificates, and will be issued
and registered in the name of the holders of the Agent's Special Warrants,
subject to Applicable Legislation.
3.7 The certificates representing the Agent's Warrants will be satisfactory in
form and substance to the Agent, and will provide, among other things:
(a) that the right to purchase a Share upon exercise of an Agents'
Warrant may be exercised at any time until the close of
business on that day which falls 12 months from the Closing on
which the Agent's Special Warrant pursuant to which the
Agent's Warrant was acquired was issued;
(b) that one Agent's Warrant will entitle the holder, on exercise,
to purchase one Share at a price of U.S. $3.31 per Share;
(c) that upon exercise or expiry, the Agent's Warrants will be
automatically cancelled and will have no further force and
effect;
(d) that the Agent's Warrants will not be transferable, except in
accordance with Applicable Legislation and any order which may
be issued by either of the Commissions; and
(e) for the appropriate adjustment in the class, number and price
of the Shares to be issued upon exercise of the Agent's
Warrants upon the occurrence of certain events, including any
subdivision, consolidation or reclassification of the Issuer's
common shares, the payment of stock dividends and the
amalgamation of the Issuer.
4. AGENT'S FEE
4.1 In consideration of the introduction of the Purchasers to the Company by the
Agent under this Agreement, the Issuer will, on each Closing:
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(a) pay to the Agent a commission of 8% of the gross proceeds from
the sale of the Special Warrants, including Special Warrants
sold pursuant to the Greenshoe Option, in lawful currency of
the United States (the "Agent's Fee"); and
(b) issue to the Agent or according to the Agent's direction such
number of Agent's Special Warrants as is equal to 10% of the
Special Warrants sold on such Closing; and
4.2 In consideration of various corporate finance services rendered by the Agent
to the Issuer in connection with the Private Placement, including without
limitation acting as financial advisor to the Issuer, the Issuer will, on the
first Closing, issue to the Agent or according to the Agent's direction 30,000
Corporate Finance Shares.
4.3 The Issuer will not endorse the certificates representing the Agent's
Special Warrants, the Agent's Warrants and Shares which may be obtained upon
exercise thereof, the Shares which may be obtained upon exercise of the Agent's
Warrants, or the Corporate Finance Shares with any legend denoting restrictions
on resale under United States securities law.
5. OFFERING RESTRICTIONS
5.1 The Agent will only sell the Special Warrants to persons who represent
themselves as being:
(a) qualified to purchase the Special Warrants under the
Exemptions; and
(b) persons who are not resident in Canada.
5.2 The Agent acknowledges that the Securities have not been registered under
the 1933 Act and may not be offered or sold except in accordance with Regulation
S or, for offers and sales to U.S. Persons, pursuant to Regulation D or Section
4(2) of the 1933 Act. Accordingly, the Agent represents, warrants and covenants
to the Issuer that, with respect to each offer or sale of Securities, either (a)
or (b) is true:
(a) it has offered and sold, and will offer and sell, Securities
only in accordance with Rule 903 of Regulation S. Accordingly,
neither the Agent, its affiliates nor any persons acting on
its behalf, has made or will make:
(i) any offer to sell, or any solicitation of an offer to
buy, Securities to any U.S. Person or to any person
in the United States;
(ii) any sale of Securities to any purchaser unless, at
the time the buy order was or will have been
originated, the purchaser was outside the United
States, or such Agent, affiliate or person acting on
behalf of either reasonably believed that such
purchaser was outside the United States; or
(iii) any Directed Selling Efforts in the United States
with respect to the Securities; or
(b) it has offered and sold, and will offer and sell, securities
only in the following manner;
(i) immediately prior to soliciting offerees, the Agent
had reasonable grounds to believe and did believe
that each offeree was an Institutional Accredited
Investor;
(ii) no form of general solicitation or general
advertising (as those terms are used in Regulation D)
has been or will be used, 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 had been invited by general
solicitation or general advertising, in connection
with the offer or sale of the Securities to U.S.
Persons; and
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(iii) any offer, sale or solicitation of an offer to buy
Securities that has been made or will be made to U.S.
Persons was or will be made only to Institutional
Accredited Investors.
5.3 The Issuer represents, warrants, covenants and agrees that:
(a) the Corporation is a Foreign Issuer and reasonably believes
that there is no Substantial U.S. Market Interest in the
Securities;
(b) except with respect to offers or sales to Institutional
Accredited Investors in reliance upon an exemption from
registration under Rule 506 of Regulation D or section 4(2) of
the 1933 Act, neither the Issuer nor any of its affiliates,
nor any person acting on their behalf, has made or will make:
(i) any offer to sell, or any solicitation of an offer to
buy, any Securities to a U.S. Person, or a person in
the United States; or
(ii) any sale of Securities unless, at the time the buy
order was or will have been originated, the purchaser
is:
(A) outside the United States; or
(B) the Issuer, its affiliates, and any person
acting on their behalf reasonably believe
that the purchaser is outside the United
States;
(c) during the period in which the Securities are offered for
sale, neither it nor any of its affiliates, nor any person
acting on their behalf has made or will make any Directed
Selling Efforts in the United States with respect to
distributions under Regulation S, or has taken or will take
any action that would cause the exemption afforded by Section
4(2) of the 1933 Act, Regulation D or Regulation S to be
unavailable for offers and sales of the Securities, pursuant
to this Agreement; and
(d) none of the Issuer, its affiliates or any person acting on its
or their behalf have engaged or will engage in any form of
general solicitation or general advertising (as those terms
are used in Regulation D) with respect to offers or sales of
the Securities in the United States, 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.
6. SUBSCRIPTIONS
6.1 The Agent will use its reasonable best efforts to obtain from each Purchaser
introduced by the Agent, and deliver to the Issuer, on or before the Filing
Deadline duly completed and signed subscriptions in the form attached as
Schedule "A" (for non-U.S. Persons) and Schedule "B" (for U.S. Persons) or in
such other form consented to by the Issuer and the Agent and executed by the
Purchaser.
6.2 The Issuer will accept each properly completed subscription agreement
tendered by the Agent, unless:
(a) the subscriber thereunder would, by virtue of exercise of the
Special Warrants subscribed for, become a "control person" of
the Company, with the meaning of the Securities Act (British
Columbia); or
(b) the Issuer's directors determine, acting reasonably, that it
would not be in the best interests of the Issuer to accept
such subscription.
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7. FILINGS WITH THE REGULATORY AUTHORITIES
7.1 The Issuer will forthwith provide to the Exchange written notice of the
terms of this Agreement and the proposed Private Placement and all other
information required by the rules and policies of the Exchange (the "Notice").
7.2 The Issuer will forthwith provide the Agent and its solicitors with a copy
of the Notice, and, forthwith on receipt, a copy of the preliminary and final
letters of acceptance of the Notice from the Exchange.
7.3 The Issuer will use its reasonable best efforts to satisfy as expeditiously
as possible each of the conditions required to be satisfied by the Exchange
prior to acceptance by the Exchange of the Notice.
7.4 Within 10 days of each Closing, the Issuer will:
(a) file with the Commissions any report required to be filed by
Applicable Legislation, in connection with the Private
Placement, in the required form; and
(b) provide the Agent's solicitors with copies of the report or
reports.
8. CLOSINGS
8.1 In this Section:
(a) "Certificates" means the certificates representing the Special
Warrants sold on a Closing in the names and denominations
reasonably requested by the Purchasers and the Agent, and the
certificates representing the Agent's Special Warrants and the
Corporate Finance Shares to be issued on such Closing;
(b) "Proceeds" means the gross proceeds of the sale of Special
Warrants, less:
(i) the Agent's Fee;
(ii) the reasonable expenses of the Agent in connection
with the Private Placement which have not been paid
by the Issuer;
(iii) any amount which has been attached by garnishing
order or other form of attachment; and
(iv) any amount paid directly to the Issuer by Purchasers
in connection with the Private Placement.
8.2 Closings will take place on a day or days to be agreed between the Issuer
and the Agent.
8.3 The Issuer will, on each Closing, issue and deliver the Certificates to the
Agent, or according to the Agent's direction, against payment of the Proceeds.
8.4 If the Issuer has satisfied all of its obligations under this Agreement, the
Agent will, on the Closing, pay the Proceeds to the Issuer against delivery of
the Certificates.
8.5 The Issuer will endorse the Certificates, and the certificates representing
any Shares issued prior to the earlier of the day a receipt is issued for the
(final) Prospectus by the last of the Commissions and the expiry of the
applicable "hold period", with a statement that:
(a) the securities represented by the certificate are subject to a
hold period and may not be traded until the expiry of the hold
period except as permitted by Applicable Legislation; and
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(b) specifies the date the hold period expires.
8.6 Except with respect to Special Warrants purchased by U.S. Persons, the
Issuer will not endorse the Certificates, or the certificates representing the
Shares, with any legend referring to resale restrictions imposed under the 1933
Act.
9. CONDITIONS OF CLOSINGS
9.1 The obligations of the Agent on each Closing will be conditional upon the
following:
(a) the Issuer will take all necessary corporate action in order
to validly create, issue and sell the Special Warrants to the
Purchasers and the Agent's Special Warrants and the Agent's
Warrants and the Corporate Finance Shares to the Agent;
(b) the Issuer will make all necessary filings and obtain all
necessary approvals of the Regulatory Authorities, subject
only to conditions imposed by the rules and policies of the
Exchange, to issue and sell the Special Warrants to the
Purchasers and the Agent's Special Warrants and the Corporate
Finance Shares to the Agent;
(c) the issue and sale of the Special Warrants, the Agent's
Special Warrants and the Corporate Finance Shares will be
exempt from the prospectus requirement of the Acts and the
registration requirement of the 1933 Act;
(d) the issue of Shares upon exercise of the Agent's Warrants will
be exempt from the prospectus requirement of the Acts and the
registration requirement of the 1933 Act;
(e) the Issuer's outstanding common shares will be listed on the
Exchange and the American Stock Exchange, and the Shares and
the Corporate Finance Shares will be accepted for listing on
the Exchange and the American Stock Exchange, subject only to
conditions which may only be fulfilled after Closing;
(f) the Issuer will deliver to the Agent and its solicitors
favourable opinions of the Issuer's Canadian and United States
solicitors dated as of the date of such Closing, in form and
substance acceptable to the Agent and its solicitors, acting
reasonably, as to all legal matters reasonably requested by
the Agent relating to the business of the Issuer and the
creation, issuance and sale of the Securities;
(g) the Issuer will deliver to the Agent and its solicitors such
other certificates, comfort letters or opinions of its
auditors or other experts or other documents relating to the
Private Placement or the affairs of the Issuer as the Agent
and its solicitors may reasonably request;
(h) the directors of the Issuer will pass a resolution,
satisfactory in form and substance to the Agent and its
solicitors, with respect to certain corporate governance
matters; and
(i) each representation and warranty of the Issuer herein shall be
true, and the Issuer will perform or comply with all of its
covenants and obligations hereunder.
9.2 Each Closing and the obligations of the Issuer and the Agent to complete the
issue and sale of the Securities are subject to:
(a) receipt of all required regulatory approval for or acceptance
of the Private Placement; and
(b) the removal or partial revocation of any cease trading order
or trading suspension made by any competent authority to the
extent necessary to complete the Private Placement.
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10. MATERIAL CHANGES
10.1 If, between the reference date of this Agreement and that day which falls
five days from the day a receipt is issued for the (final) Prospectus by the
last of the Commissions, a Material Change relating to the Issuer or the
Subsidiaries (as hereinafter defined), or a change in a Material Fact relating
to any of the Securities occurs, the Issuer will:
(a) as soon as practicable notify the Agent and Canaccord in
writing, setting forth the particulars of such change;
(b) as soon as practicable, issue and file with the Regulatory
Authorities a press release that is authorized by a senior
officer disclosing the nature and substance of the change;
(c) as soon as practicable file with the Commissions the report of
the Material Change required by Applicable Legislation and in
any event no later than 10 days after the date on which the
change occurs;
(d) provide copies of that press release, when issued, and that
report, when filed, to the Agent and Canaccord and their
solicitors;
(e) if required by Applicable Legislation, amend the Prospectus to
reflect the change, provided it has first obtained the
approval of Canaccord for the form and substance of the
amendment; and
(f) if an amendment is prepared to the Prospectus, file such
amendment with the Commissions in the time limited by
Applicable Legislation, and provide the Agent without charge
with as many commercial copies of such amendment as it may
reasonably require.
10.2 If the Issuer is uncertain as to whether there has been a Material Change,
or a change in a Material Fact, it will promptly provide the Agent and Canaccord
with full particulars of the event giving rise to the uncertainty, and will
consult with the Agent and Canaccord as to whether such event constitutes a
Material Change, or a change in a Material Fact.
11. PROSPECTUS
11.1 The Prospectus will be satisfactory in form and substance to the Agent,
Canaccord and their solicitors, acting reasonably.
11.2 The Issuer will permit the Agent, Canaccord and their solicitors to
participate in the preparation of the Prospectus, to discuss the Issuer's
business with its corporate officials and auditors and to conduct such full and
comprehensive review and investigation of the Issuer's business, affairs,
capital and operations as the Agent, Canaccord and their solicitors reasonably
consider to be necessary to establish a "due diligence" defence under the Acts
to an action for rescission or damages based on an allegation that the
Prospectus contained a Misrepresentation, and to enable Canaccord to responsibly
execute the underwriter's certificate in the Prospectus.
11.3 The Prospectus will contain a contractual right of rescission granted by
the Issuer to the Purchasers for Misrepresentations in the Prospectus.
11.4 Provided the Agent, Canaccord and their solicitors, acting reasonably are
satisfied that the Prospectus contains full, true and plain disclosure of all
Material Facts relating to the Issuer, the Subsidiaries and the Securities, and
provided the Issuer delivers to the Agent the documents to be delivered on the
date of the (final) Prospectus, the Agent will use its best efforts to have
Canaccord execute the underwriter's certificate in the (final) Prospectus.
11.5 The delivery by the Issuer to the Agent and Canaccord of the Prospectus and
any amendment or supplement thereto will constitute the Issuer's representation
and warranty to the Agent and Canaccord that all material information and
statements contained therein (other than information and statements supplied by
and
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relating solely to the Agent and Canaccord) is contained in the Prospectus, that
the Prospectus does not contain any Misrepresentation, and the Prospectus
constitutes full, true and plain disclosure of all Material Facts relating to
the Issuer and its Subsidiary, and to the Securities.
11.6 On the date of the (final) Prospectus, the Issuer will deliver the
following documents to the Agent, Canaccord and their solicitors, each of which
will be in form and substance satisfactory to the Agent, Canaccord and their
solicitors, acting reasonably:
(a) an opinion of the auditors of the Issuer, dated as of the date
of the (final) Prospectus and addressed to the Agent and
Canaccord, relating to the accuracy of the financial
statements included in the Prospectus and verification of the
accuracy of the financial, numerical and certain other
information disclosed in the (final) Prospectus;
(b) a certificate of the Issuer issued to the Agent and Canaccord
and their solicitors, dated as of the date of the (final)
Prospectus and executed by the President of the Issuer or by
another officer approved by the Agent and Canaccord,
certifying certain facts relating to the Issuer and its
affairs reasonably requested by the Agent and Canaccord and
their solicitors; and
(c) any other certificates, comfort letters or opinions in
connection with any matter related to the Prospectus which are
reasonably requested by the Agent, Canaccord or their
solicitors.
11.7 On the day a receipt is issued for the Prospectus by the last of the
Commissions, the Issuer will deliver the following documents to the Agent,
Canaccord, and their solicitors, each of which will be in form and substance
satisfactory to the Agent, Canaccord and their solicitors, acting reasonably:
(a) an opinion of counsel of the Issuer, dated as of such date and
addressed to the Agent, Canaccord and their solicitors,
relating to any legal matters in connection with the Issuer
and the Distribution for which the Agent, Canaccord or their
solicitors may reasonably request an opinion; and
(b) any other certificates, comfort letters or opinions in
connection with any matter related to the Prospectus which are
reasonably requested by the Agent, Canaccord or their
solicitors.
11.8 The Issuer will furnish to the Agent such number of commercial copies of
the Prospectus and each amendment and supplement thereto and such other relevant
documents as the Agent may reasonably request.
11.9 Once the Commissions have issued receipts for the (final) Prospectus, and
the Issuer has delivered to the Agent copies of such receipts and all documents
required to be delivered to the Agent on the date of the (final) Prospectus and
the date a receipt is issued for the (final) Prospectus by the last of the
Commissions, the Agent will deliver, or cause to be delivered, one copy of the
(final) Prospectus to each holder of Special Warrants.
12. TERMINATION
12.1 The Agent may terminate its obligations under this Agreement by notice in
writing to the Issuer at any time before the final Closing if:
(a) an adverse Material Change relating to the Issuer or the
Subsidiaries, or an adverse change in a Material Fact relating
to any of the Securities, occurs or is announced by the
Issuer;
(b) there is an event, accident, governmental law or regulation or
other occurrence of any nature which, in the opinion of the
Agent, seriously affects or will seriously affect the
financial markets, or the market for the Issuer's securities
in particular, or the business of the Issuer or the
Subsidiaries, or the ability of the Agent to perform its
obligations under this Agreement, or a Purchaser's decision to
purchase the Special Warrants;
(c) following a consideration of the history, business, products,
property or affairs of the Issuer, its principals and
promoters, or the Subsidiaries, or of the state of the
financial markets in general, or
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the state of the market for the Issuer's securities in
particular, the Agent determines, in its sole discretion, that
it is not in the interest of the Purchasers to complete the
purchase and sale of the Special Warrants;
(d) an enquiry or investigation (whether formal or informal) in
relation to the Issuer, the Issuer's directors, officers or
promoters, the Subsidiaries or its directors or officers is
commenced or threatened by an officer or official of any
competent authority;
(e) any order to cease, halt or suspend trading (including an
order prohibiting communications with persons in order to
obtain expressions of interest) in the securities of the
Issuer prohibiting or restricting the Private Placement or the
Distribution is made by a competent regulatory authority and
that order is still in effect;
(f) the Issuer is in breach of any material term of this
Agreement; or
(g) the Agent determines that any of the representations or
warranties made by the Issuer in this Agreement is false or
has become false.
12.2 The obligations of the Agent hereunder will terminate if the Exchange has
not granted approval for the Private Placement, subject only to filings with the
Exchange which may only be made after Closing, within 90 days of the reference
date hereof.
12.3 The Agent may terminate its obligations under this Agreement with respect
to the Distribution and the Prospectus at any time prior to the expiry of the
last of the "hold periods" applicable to any of the Securities if:
(a) any order to cease trading (including an order prohibiting
communications with persons in order to obtain expressions of
interest) in the securities of the Issuer is made by a
competent regulatory authority and that order is still in
effect;
(b) the Issuer is in breach of any material term of this
Agreement; or
(c) the Agent determines that any of the representations or
warranties made by the Issuer in this Agreement is false or
has become false.
13. WARRANTIES, REPRESENTATIONS AND COVENANTS
13.1 The Issuer warrants and represents to the Agent that:
(a) the Issuer is a valid and subsisting company duly incorporated
and organized under the laws of British Columbia, is a
"reporting issuer" under the Acts, and the Issuer:
(i) is in good standing and up to date with all filings
required under the Company Act (British Columbia);
and
(ii) has the corporate power and capacity to enter into
this Agreement and to carry out the transactions
herein contemplated;
(b) the Issuer is a "reporting issuer" under the 1934 Act, and is
not in default of any of the requirements thereof or the rules
and regulations made thereunder;
(c) the Issuer is a Foreign Issuer within the meaning of Rule 405
made under the 1933 Act, and there is no "Substantial U.S.
Market Interest", within the meaning of Rule 902 made under
the 1933 Act, in the Issuer' securities;
(d) the Issuer is a "Qualifying Issuer" within the meaning of
Blanket Order and Ruling 98/7 issued by the British Columbia
Securities Commission, and has filed a "Current AIF" within
the meaning of
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Local Policy Statement 3-27 issued by the British Columbia
Securities Commission, together with all supporting documents;
(e) the Issuer carries on business in the Province of British
Columbia and does not carry on business in any other province
or territory of Canada or in any other country;
(f) the Issuer has no "Subsidiaries" or "affiliated" companies,
each within the meaning of the Securities Act (British
Columbia), and owns no equity interest in any business
organization, apart from Genetronics, Inc. and Genetronics
S.A. (the "Subsidiaries");
(g) Genetronics, Inc. is a valid and subsisting company duly
incorporated and organized under the laws of California, and
is in good standing and up to date with all filings required
under the California Corporations Code.
(h) Genetronics S.A. is a valid and subsisting company duly
incorporated and organized under the laws of France, and is in
good standing and up to date with all filings required under
the corporate legislation of France.
(i) the Issuer is the recorded and beneficial owner of 100% of the
issued and outstanding shares in the capital of the
Subsidiaries. No person has any right, agreement or option,
present or future, contingent or absolute, or any right
capable of becoming such a right, agreement or option to
acquire any such shares or, for the issue or allotment of any
shares in the capital of the Subsidiaries, or any other
security convertible or exchangeable for such shares.
(j) the Issuer and the Subsidiaries each hold all material
licences and permits that are required for carrying on their
businesses in the manner and in the jurisdictions in which
such businesses are presently being carried on;
(k) the Issuer and the Subsidiaries each have the corporate power
and capacity to own their assets and to carry on the
businesses presently carried on by them;
(l) the authorized capital of the Issuer consists of 200,000,000
shares divided into 100,000,000 common shares without par
value and 100,000,000 Class A preferred shares without par
value of which 21,666,226 common and no Class A preferred
shares are issued and outstanding as at the date hereof, and
the outstanding shares are fully paid and non-assessable;
(m) the Issuer will reserve or set aside sufficient shares in its
treasury to issue the Shares and the Corporate Finance Shares;
(n) the minute books of the Issuer contain all records of the
proceedings of the meetings of the Issuer's directors,
shareholders and committees of directors since its date of
incorporation, except for the minutes of the meeting of
directors held on May 28, 1999;
(o) the minute books of the Subsidiaries contain all records of
the proceedings of the meetings of its directors, shareholders
and committees of directors since its date of incorporation,
except for the minutes of the meeting of directors held on May
28, 1999;
(p) since their respective dates of incorporation the businesses
of the Issuer and the Subsidiaries have been carried on in the
usual and ordinary course and neither the Issuer nor the
Subsidiaries have entered into any transaction out of the
usual and ordinary course of business;
(q) since October 7, 1994, there has not been any adverse Material
Change in the position (financial, business or otherwise) or
condition of the Issuer (on a consolidated basis);
(r) the Issuer has filed all documents which it is required to
file under the continuous disclosure provisions of the Acts,
and the Issuer has filed no Material Change reports on a
confidential basis
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with the securities regulatory authorities in these
jurisdictions where it is a "reporting issuer" which remain
confidential;
(s) the Issuer's outstanding common shares are listed, posted and
called for trading on the Exchange, and the Issuer is not in
material breach of its Listing Agreement with the Exchange;
(t) the Issuer's outstanding common shares are listed, posted and
called for trading on the American Stock Exchange, and the
Issuer is not in material breach of its Listing Agreement with
the American Stock Exchange;
(u) neither the Issuer nor the Subsidiaries are subject to any
material mortgage, lien, lease, agreement, instrument or any
other restriction of any kind or character which would prevent
the consummation of the transactions contemplated herein;
(v) the Issuer or the Subsidiaries are the beneficial owners of
the properties, business and assets or the interests in the
properties, business or assets referred to in the Disclosure
Record, free and clear of all liens, charges and encumbrances,
except as may be disclosed in the Disclosure Record, and all
agreements by which the Issuer or the Subsidiaries holds an
interest in a property, business or assets are in good
standing according to their terms;
(w) the audited consolidated financial statements of the Issuer
for its fiscal year ended March 31, 1998 (the "Audited
Financial Statements) and the unaudited consolidated financial
statements of the Issuer for the three month period ended
December 31, 1998 (the "Interim Financial Statements") have
been prepared in accordance with Canadian generally accepted
accounting principles, accurately reflect the financial
position and all material liabilities (accrued, absolute,
contingent or otherwise) of the Issuer as at the respective
dates thereof, and there have been no adverse Material Changes
in the financial position of the Issuer on a consolidated
basis since the date of the Audited Financial Statements,
except as recorded in the books of the Issuer and fully and
plainly disclosed in the Disclosure Record;
(x) since the date of the Audited Financial Statements, there has
not been any adverse Material Change of any kind whatsoever in
the financial position or condition of the Issuer on a
consolidated basis or any damage, loss or other change of any
kind whatsoever in circumstances materially affecting the
business or assets of the Issuer or the Subsidiaries, or the
right or capacity of the Issuer or the Subsidiaries to carry
on their businesses;
(y) no financial statements of the Issuer are publicly available
as at any date, or for any period, subsequent to the Interim
Financial Statements;
(z) all of the material transactions of the Issuer and the
Subsidiaries have been promptly and properly recorded or filed
in or with the books or records of the Issuer;
(aa) all of the material contracts of the Issuer and the
Subsidiaries are described in the Disclosure Record and are in
good standing in all material respects, and neither the Issuer
nor the Subsidiaries are in default in any material respect
thereof, and neither the Issuer nor the Subsidiaries are aware
of any default in any material respect by any other party to
such contracts;
(ab) neither the Issuer nor the Subsidiaries are party to any
agreement, option, understanding or commitment, or any right
or privilege capable of becoming an agreement, option,
understanding or commitment, for the purchase of any of the
businesses, properties or assets or interests in the
businesses properties or assets referred to in the Disclosure
Record, except as may be disclosed in the Disclosure Record;
(ac) the subscription form and all other written or oral
representations made by the Issuer to an investor or potential
investor in connection with the Private Placement will be
accurate in all material respects and will omit no fact, the
omission of which will make such representation misleading;
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(ad) the Issuer has complied in all material respects and will
comply in all material respects with the requirements of all
applicable corporate and securities laws including, without
limitation, Applicable Legislation, the Company Act (British
Columbia), the 1933 Act and the 1934 Act in relation to the
issue and trading of its securities and in all matters
relating to the Private Placement;
(ae) the issue and sale of the Special Warrants by the Issuer and
the Agent does not and will not conflict with, and does not
and will not result in a breach of, any of the terms of its
incorporating documents or those of the Subsidiaries, or any
agreement or instrument to which the Issuer or the
Subsidiaries are a party;
(af) neither the Issuer nor the Subsidiaries are a party to any
actions, suits or proceedings which could materially affect
the Issuer's business or financial condition (on a
consolidated basis), and to the best of the Issuer's knowledge
no such actions, suits or proceedings are contemplated or have
been threatened;
(ag) there are no judgments against the Issuer or the Subsidiaries
which are unsatisfied, nor are there any consent decrees or
injunctions to which the Issuer or the Subsidiaries is
subject;
(ah) neither the Issuer nor the Subsidiaries are in breach of any
law, rule, statute, regulation or by-law applicable to its
operations, properties or assets, the breach of which would
result in a adverse Material Change in the position
(financial, business or otherwise) or condition of the Issuer
(on a consolidated basis), or would affect the rights of the
Issuer or the Subsidiaries;
(ai) no order ceasing or suspending trading in securities of the
Issuer or prohibiting the sale of such securities has been
issued against the Issuer or its directors, officers or
promoters or against any other companies that have common
directors, officers or promoters, and to the best of the
knowledge of the Issuer, no investigations or proceedings for
such purposes are pending or threatened;
(aj) the Issuer and the Subsidiaries have filed all federal,
provincial, state, local and foreign tax returns which are
required to be filed, or have requested extensions thereof,
and have paid all taxes required to be paid by them and any
other assessment, fine or penalty levied against them, to the
extent that any of the foregoing is due and payable, except
for such assessments, fines and penalties which are currently
being contested in good faith;
(ak) the Issuer and the Subsidiaries have established on their
books and records reserves which are adequate for the payment
of all taxes not yet due and payable and there are no liens
for taxes on the assets of the Issuer or the Subsidiaries,
except for taxes not yet due, and there are no audits of any
of the tax returns of the Issuer or the Subsidiaries which are
known by the Issuer's management to be pending, and there are
no claims which have been or may be asserted relating to any
such tax returns which, if determined adversely, would result
in the assertion by any governmental agency of any deficiency
which would have a material adverse effect on the properties,
business or assets of the Issuer on a consolidated basis;
(al) this Agreement has been duly authorized by all necessary
corporate action on the part of the Issuer;
(am) this Agreement is, and the Special Warrant Indenture and the
certificates representing the Agent's Special Warrants will
be, upon execution and delivery by the Issuer, legal, valid
and binding agreements of the Issuer, enforceable against the
Issuer in accordance with their terms, subject only to
customary qualifications regarding the availability of
equitable remedies; and
(an) the Issuer or the Subsidiaries. own or possess adequate rights
to use all material patents, trade-marks, service marks, trade
names, copyrights, trade secrets, information, proprietary
rights and processes necessary for the Issuer's business (on a
consolidated basis) as now conducted and as proposed to be
conducted, without any conflict with or infringement of the
rights of the others.
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Neither the Issuer nor the Subsidiaries has received any
communication alleging that the Issuer or the Subsidiaries has
violated or, by conducting such business as proposed, would
violate any of the patents, trade-marks, service marks, trade
names, copyrights or trade secrets or other proprietary rights
of any other person or entity, apart from on April 7, 1999
pursuant to an ongoing discussion of issues initiated by the
Issuer between the Issuer and the University of South Florida
("USF"), the Issuer received correspondence from USF
purporting to claim certain rights to U.S. Patent No. 5,702,
359, "Needle Electrodes for Mediated Delivery of Drugs and
Genes" issued to Xxxxxxx X. Xxxxxxx, Xxxxxxx X. Xxxxxxx,
Yauhico Hayakawa, Xxxxxxx Xxxxxx and Xxxx X. Xxxxxxxxxx on
December 30, 1997. Such patent is assigned to the Issuer, and
the Issuer disputes USF's claim of rights to such patent.
Neither the execution or delivery of this Agreement, the
conduct of the Issuer's business (on a consolidated basis),
nor the activities of any employees of the Issuer, or the
Subsidiaries in conducting that business will conflict with or
result in a breach of the terms, conditions or provisions of
or constitute a default under, any contract, covenant, or
instrument under which any of such employees is now obligated.
13.3 The representations and warranties of the Issuer contained herein will be
true and correct at each Closing, will survive each Closing, and no
investigation by or on behalf of the Agent will diminish in any respect its
right to rely on such representations and warranties.
13.4 The Agent warrants and represents to the Issuer that:
(a) it is a valid and subsisting corporation under the law of the
jurisdiction in which it was incorporated; and
(b) it will sell the Special Warrants in compliance with the Acts
and the 1933 Act.
14. EXPENSES OF AGENT
14.1 The Issuer will pay all of the expenses of the Private Placement, the
Prospectus and the Distribution and all the expenses reasonably incurred by the
Agent and Canaccord in connection with the Private Placement, the Prospectus and
the Distribution including, without limitation, the reasonable fees and expenses
of the solicitors for the Agent and Canaccord.
14.2 The Issuer will pay the expenses referred to in Subsection 14.1 even if the
transactions contemplated by this Agreement are not completed or this Agreement
is terminated, unless the failure of acceptance or completion or the termination
is the result of a breach of this Agreement by the Agent.
14.3 The Agent and Canaccord may, from time to time, render accounts for their
expenses in connection with the Private Placement, the Prospectus and the
Distribution to the Issuer for payment on or before the payment dates set out in
the accounts.
14.4 The Issuer authorizes the Agent to deduct its reasonable expenses and those
of Canaccord in connection with Private Placement from the gross proceeds of the
Private Placement and any advance payments made by the Issuer, including
expenses for which an account has not yet been rendered.
15. GARNISHING ORDERS
15.1 If at any time, up to and including the final Closing, the Agent receives a
garnishing order or other form of attachment purporting to attach or garnish a
part or all of the sale price of any of the Securities, the Agent will be free
to pay the amount purportedly attached or garnished into court.
15.2 Any payment by the Agent into court pursuant to a garnishing order will be
deemed to have been received by the Issuer as payment by the Agent against the
sale price of the Securities to the extent of the amount paid, and the Issuer
will be bound to issue and deliver the Securities proportionately to the amount
paid by the Agent.
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15.3 The Agent will not be bound to ascertain the validity of any garnishing
order or attachment, or whether in fact it attaches any moneys held by the
Agent, and the Agent will be free to act with impunity in replying to any
garnishing order or attachment.
15.4 The Issuer will release, indemnify and save harmless the Agent in respect
of all damages, costs, expenses or liability arising from any acts of the Agent
under this Section.
16. INDEMNITY
16.1 The Issuer will indemnify the Agent, Canaccord and each of their respective
directors, officers, employees and agents (collectively, the "Indemnified
Parties") and save them harmless against all losses, claims, damages or
liabilities:
(a) existing by reason of an untrue statement contained in the
subscription agreement, the Disclosure Record or other written
or oral representation made by the Issuer to a Purchaser or
potential Purchaser in connection with the Private Placement,
or in the Prospectus, the Registration Statement or other
written or oral representation made by the Issuer in
connection with the Distribution, or by reason of the omission
to state any fact necessary to make such statements or
representations not misleading (except for information and
statements supplied by and relating solely to the Agent or
Canaccord);
(b) arising directly or indirectly out of any order made by any
regulatory authority based upon an allegation that any such
untrue statement or representation, or omission exists (except
information and statements supplied by and relating solely to
the Agent or Canaccord), that trading in or distribution of
any of the Securities is to cease;
(c) resulting from the failure by the Issuer to obtain the
requisite regulatory approval for the Private Placement, the
Prospectus or the Registration Statement unless the failure to
obtain such approval is the result of a breach of this
Agreement by the Agent;
(d) resulting from the breach by the Issuer of any of the terms of
this Agreement;
(e) resulting from any representation or warranty made by the
Issuer herein not being true or ceasing to be true;
(f) if the Issuer fails to issue and deliver the certificates
representing the Securities in the form and denominations
satisfactory to the Agent at the time and place required by
the Agent with the result that any completion of a sale of the
Securities does not take place; or
(g) if, following the completion of a sale of any of the
Securities, a determination is made by any competent authority
setting aside the sale, unless that determination arises out
of an act or omission by the Agent.
16.2 If any action or claim is brought against an Indemnified Party in respect
of which indemnity may be sought from the Issuer pursuant to this Agreement, the
Indemnified Party will promptly notify the Issuer in writing.
16.3 The Issuer will assume the defence of the action or claim, including the
employment of counsel and the payment of all expenses.
16.4 The Indemnified Party will have the right to employ separate counsel, and
the Issuer will pay the fees and expenses of such counsel.
16.5 The indemnity provided for in this Section will not be limited or otherwise
affected by any other indemnity obtained by the Indemnified Party from any other
person in respect of any matters specified in this
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Agreement and will continue in full force and effect until all possible
liability of the Indemnified Parties arising out of the transactions
contemplated by this Agreement has been extinguished by the operation of law.
16.6 If indemnification under this Agreement is found in a final judgment (not
subject to further appeal) by a court of competent jurisdiction not to be
available for reason of public policy, the Issuer and the Indemnified Parties
will contribute to the losses, claims, damages, liabilities or expenses (or
actions in respect thereof) for which such indemnification is held unavailable
in such proportion as is appropriate to reflect the relative benefits to and
fault of the Issuer, on the one hand, and the Indemnified Parties on the other
hand, in connection with the matter giving rise to such losses, claims, damages,
liabilities or expenses (or actions in respect thereof). No person found liable
for a fraudulent Misrepresentation will be entitled to contribution from any
person who is not found liable for such fraudulent Misrepresentation.
16.7 To the extent that any Indemnified Party is not a party to this Agreement,
the Agent will obtain and hold the right and benefit of this section in trust
for and on behalf of such Indemnified Party.
17. ASSIGNMENT AND SELLING GROUP PARTICIPATION
17.1 The Agent will not assign this Agreement or any of its rights under this
Agreement or, with respect to the Securities, enter into any agreement in the
nature of an option or a sub-option unless and until, for each intended
transaction, the Agent has obtained the consent of the Issuer, and any required
notice has been given to and accepted by the Regulatory Authorities.
17.2 The Agent may offer selling group participation in the normal course of the
brokerage business to selling groups of other dealers, brokers and investments
dealers outside of Canada and the United States, who may or who may not be
offered part of the Agent's Fee.
18. NOTICE
18.1 Any notice under this Agreement will be given in writing and must be
delivered, sent by telegram or telecopier or mailed by prepaid post and
addressed to the party to which notice is to be given at the address indicated
above, or at another address designated by the party in writing.
18.2 If notice is sent by telegram or telecopier or is delivered, it will be
deemed to have been given at the time of transmission or delivery.
18.3 If notice is mailed, it will be deemed to have been received 48 hours
following the date of mailing of the notice.
18.4 If there is an interruption in normal mail service due to strike, labour
unrest or other cause at or prior to the time a notice is mailed the notice will
be sent by telegram or telecopier or will be delivered.
19. TIME
Time is of the essence of this Agreement and will be calculated in accordance
with the provisions of the Interpretation Act (British Columbia).
20. SURVIVAL OF REPRESENTATIONS AND WARRANTIES
The representations, warranties, covenants and indemnities of the Issuer
contained in this Agreement will survive the final Closing.
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21. LANGUAGE
This Agreement is to be read with all changes in gender or number as required by
the context.
22. ENUREMENT
This Agreement enures to the benefit of and is binding on the parties to this
Agreement and their successors and permitted assigns.
23. HEADINGS
The headings in this Agreement are for convenience of reference only and do not
affect the interpretation of this Agreement.
24. COUNTERPARTS
This Agreement may be executed in two or more counterparts and may be delivered
by telecopier, each of which will be deemed to be an original and all of which
will constitute one agreement, effective as of the reference date given above.
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25. LAW
This Agreement is governed by the law of British Columbia and shall be
considered in all respects a British Columbia contract, and the parties hereto
irrevocably attorn and submit to the jurisdiction of the courts of British
Columbia with respect to any dispute related to this Agreement.
This document was executed and delivered as of the date given above.
The common seal of GENETRONICS )
BIOMEDICAL LTD. was hereunto )
affixed in the presence of: )
)
)
/s/ Xxxxx X. Xxxxxxx )
--------------------------------------- )
Authorized Signatory ) c/s
)
CANACCORD )
INTERNATIONAL (L) CORPORATION )
)
)
)
/s/ Xxxxxxxxx X. Xxxxxxx )
--------------------------------------- )
Authorized Signatory )
)
)
--------------------------------------- )
Authorized Signatory )
21
SCHEDULE "A"
SUBSCRIPTION AGREEMENT
(THE "AGREEMENT")
The undersigned (the "Subscriber") hereby subscribes for and agrees to purchase
_____________________ special warrants (the "Special Warrants") of Genetronics
Biomedical Ltd. (the "Company") at a price of US$3.00 per Special Warrant for
aggregate proceeds of US$_____________________ (the "Subscription Price"), all
on the terms and subject to the conditions set forth in Schedule A attached
hereto and in the Agency Agreement and the Special Warrant Indenture (each as
defined herein).
EXECUTION BY SUBSCRIBER
------------------------------------
Name of Subscriber
------------------------------------
Address of Subscriber
Signature of Individual Subscriber or
Authorized Signatory of Subscriber ------------------------------------
(if Subscriber is NOT an individual) Name of Contact Person, if
Subscriber not an individual
( )
------------------------------------
Telephone Number of Subscriber or
Contact Person
( )
------------------------------------
Facsimile Number of Subscriber or
Contact Person
EXECUTED BY THE SUBSCRIBER THIS __________ DAY OF _________________, 1999.
PLEASE COMPLETE THE FOLLOWING SECTION IF YOU REQUIRE THE CERTIFICATE(S)
REPRESENTING THE SECURITIES TO APPEAR IN THE NAME OF AN INTERMEDIARY, SUCH AS
YOUR BROKER, OR REQUIRE THE CERTIFICATE(S) TO BE DELIVERED TO AN ADDRESS OTHER
THAN THAT SHOWN ABOVE.
------------------------------------ ------------------------------------
REGISTRATION INSTRUCTIONS DELIVERY INSTRUCTIONS
------------------------------------ ------------------------------------
Name to appear on certificate(s) Name and account reference, if
applicable
------------------------------------ ------------------------------------
Account reference, if applicable Contact Person
------------------------------------ ------------------------------------
Address of Intermediary Address for Delivery
------------------------------------
Telephone Number of Contact Person
ACCEPTED by the Company this __________ day of ________________, 1999.
GENETRONICS BIOMEDICAL LTD.
Per: __________________________________
Authorized Signatory
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SCHEDULE A
In consideration of the covenants and agreements herein, and the payment of one
dollar made by each party to the other, the receipt and sufficiency of which is
acknowledged by each party, the parties agree as follows:
1. DESCRIPTION OF SPECIAL WARRANTS
The Special Warrants will be transferable and will be issued pursuant to
an indenture to be made between the Company and Montreal Trust Company of Canada
(the "Special Warrant Indenture") and shall entitle the holders thereof to
receive, without additional payment, upon exercise of the Special Warrants, one
common share (a "Share") of the Company for each Special Warrant held.
The Special Warrants will be exercisable at any time on or before 4:30
p.m. (Vancouver time) (the "Expiry Time"), on the day which is the earlier of:
(a) 12 months from the Closing (as defined below); and (b) the day which is five
business days after a receipt for a (final) prospectus (the "Prospectus")
qualifying the issuance of the Shares issuable upon due exercise of the Special
Warrants has been issued by the securities regulatory authorities in British
Columbia and such other Provinces in Canada that the Agent reasonably requires
(collectively, the "Filing Jurisdictions"). Special Warrants not expressly
exercised by the holders thereof prior to the Expiry Time shall be deemed to
have been so exercised immediately prior thereto.
The Company has covenanted and agreed to, among other things, use its
reasonable best efforts to finalize and obtain a receipt for the Prospectus in
each of the Filing Jurisdictions no later than 5:00 p.m. (Vancouver time) on the
day which is 90 days from Closing (the "Qualification Deadline").
IN THE EVENT THAT THE COMPANY IS UNABLE TO OBTAIN A RECEIPT FOR THE
PROSPECTUS IN ANY OF THE FILING JURISDICTIONS, THE SPECIAL WARRANTS AND THE
SHARES (COLLECTIVELY, THE "SECURITIES") WILL BE SUBJECT TO STATUTORY HOLD
PERIODS DURING WHICH, SUBJECT TO THE AVAILABILITY OF ANOTHER EXEMPTION, THE
SECURITIES MAY NOT BE RESOLD IN SUCH FILING JURISDICTIONS. IN ADDITION, ANY
SHARES OBTAINED PURSUANT TO THE EXERCISE OF SPECIAL WARRANTS PRIOR TO THE
ISSUANCE OF RECEIPTS FOR THE PROSPECTUS BY THE SECURITIES COMMISSIONS IN THE
FILING JURISDICTIONS WILL BE SUBJECT TO STATUTORY RESTRICTIONS ON RESALE. THE
COMPANY IS A REPORTING ISSUER IN BRITISH COLUMBIA AND ONTARIO. THE COMPANY IS
NOT A REPORTING ISSUER IN ANY OTHER JURISDICTION AND A HOLDER RESIDENT IN
ANOTHER JURISDICTION MAY BE SUBJECT TO DIFFERENT AND LONGER RESALE RESTRICTIONS.
RESIDENTS OF SUCH OTHER JURISDICTIONS ARE URGED TO CONSULT WITH COUNSEL THEREIN
ABOUT APPLICABLE RESALE RESTRICTIONS.
IT IS A FURTHER PROVISION OF THE SPECIAL WARRANT INDENTURE THAT THE
AGGREGATE PROCEEDS OF THE SALE OF THE SPECIAL WARRANTS (THE "PROCEEDS"), WILL BE
DELIVERED TO THE COMPANY AT THE CLOSING (AS DEFINED BELOW).
THE TERMS AND CONDITIONS WHICH GOVERN THE SPECIAL WARRANTS ARE CONTAINED
IN THE SPECIAL WARRANT INDENTURE WHICH CONTAINS, AMONG OTHER THINGS,
ANTI-DILUTION PROVISIONS AND PROVISIONS FOR THE APPROPRIATE ADJUSTMENT IN THE
CLASS, NUMBER AND PRICE OF THE SHARES UPON THE OCCURRENCE OF CERTAIN EVENTS,
INCLUDING ANY SUBDIVISION, CONSOLIDATION OR
23
-3-
RECLASSIFICATION OF THE SHARES OR PAYMENTS OF STOCK DIVIDENDS OR THE
AMALGAMATION OR OTHER SUBSTANTIAL REORGANIZATION OF THE COMPANY.
The Special Warrants herein subscribed for form part of a larger
offering (the "Offering") of up to 4,500,000 Special Warrants to be issued by
the Company pursuant to an agency agreement (the "Agency Agreement") between the
Company and Canaccord International (L) Corporation (the "Agent").
The foregoing description of the Special Warrants is a summary only and
is subject to the detailed provisions of the Special Warrant Indenture under
which they are to be issued.
2. PAYMENT
The Subscription Price must be paid by wire transfer of funds in United
States dollars at par.
3. REGISTRATION AND DELIVERY INSTRUCTIONS
The Subscriber must complete, sign and return by courier to Canaccord
Capital Corporation of X.X. Xxx 00000, 2200 - 000 Xxxxxxxxx Xxxxxx, Xxxxxxxxx,
Xxxxxxx Xxxxxxxx, X0X 0X0:
(a) an executed copy of this Agreement;
(b) delivery instructions attached as Exhibit A;
(c) Toronto Stock Exchange Questionnaire and Undertaking in the form
attached as Exhibit B;
(d) if an individual, Form 20A(IP) attached as Exhibit C; and
(e) if applicable, an Undertaking of Foreign Portfolio Manager,
attached as Exhibit D; and
(f) a wire transfer of funds to:
Bank of Montreal
Montreal, Quebec
Swift: XXXXXXX0
Account: 0004 0000000
Beneficiary: Canaccord Capital Corp.
Client Name: Canaccord International Corporation
Client Account Number: 252-974B-9
in the amount of the Subscription Price.
24
-4-
The Subscriber (or if applicable, others for whom it is contracting
hereunder) 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 of the Subscriber by regulatory authorities and applicable
law.
4. CLOSING
The closing of the transactions contemplated herein will be completed at
the offices of Catalyst Corporate Finance Lawyers at Xxxxx 0000, 0000 Xxxx
Xxxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxx Xxxxxxxx, X0X 0X0 or at such other place as
the Company and the Agent shall agree, at 10:00 a.m. (Vancouver Time) on the
date upon which the Company and the Agent agree (the "Closing").
This executed Agreement is open for acceptance in whole or in part by
the Company in its sole discretion in each case or at any time prior to the
Closing. Confirmation of acceptance or rejection of a subscription will be
forwarded to the Subscriber promptly after acceptance or rejection has been
made. If this Agreement is rejected in whole and if the Subscriber has delivered
a certified cheque or bank draft representing the Subscription Price for the
Special Warrants, then such cheque or bank draft will be promptly returned to
the Subscriber without deduction or interest. If this Agreement is accepted only
in part and the Subscriber has delivered a certified cheque or bank draft as
aforesaid, a cheque representing the portion of the Subscription Price for that
portion of the Subscriber's subscription for Special Warrants which is not
accepted will be promptly returned to the Subscriber without interest.
Certificates representing the Special Warrants (individually, a "Special
Warrant Certificate", and collectively, the "Special Warrant Certificates") will
be available for delivery at the Closing against payment of the aggregate
Subscription Price in the manner specified above. If the Subscriber does not
choose to attend the Closing to receive the Special Warrant Certificate
representing the Special Warrants subscribed for herein, then the Subscriber, on
its own behalf or on behalf of others for whom it is contracting hereunder,
hereby appoints the Agent, with full power of substitution, as its true and
lawful attorney and agent with the full power and authority in its place and
stead to swear, execute, file and record any document necessary to accept
delivery of the Special Warrants at the Closing, to terminate this Agreement on
its behalf in the event that any condition precedent to the offering has not
been satisfied, to execute a receipt for the Special Warrants and any other
documentation, modify or waive any conditions or grant any waivers on its behalf
in connection with this transaction, and to deliver Special Warrant Certificates
to the Subscriber at the address set forth above promptly after the Closing.
5. PROSPECTUS EXEMPTIONS
The sale and delivery of the Special Warrants to the Subscriber (or
others for whom it is contracting hereunder) is conditional upon such sale being
exempt from the requirement to file a prospectus, as defined in applicable
securities legislation, in the Filing Jurisdictions or upon the issuance of such
rulings, orders, consents or approvals as may be required to permit such sale
and delivery without the requirement of filing a prospectus.
25
-5-
The Subscriber on its own behalf (or on behalf of others for whom it is
contracting hereunder, if applicable) acknowledges and agrees that:
(a) it (or others from whom it is contracting hereunder) has not
been provided with, nor has it requested, nor does it have any
need to receive an offering memorandum as defined in applicable
securities legislation (an "Offering Memorandum") or other
documents (other than annual financial statements, interim
financial statements or any other document the content of which
is prescribed by statute) describing the business and affairs of
the Company which has been prepared for delivery to and to be
reviewed by prospective purchasers in order to assist these
purchasers in making an investment decision in respect of the
Special Warrants;
(b) its decision to execute this Agreement and purchase the Special
Warrants (on its own behalf or on behalf of those for whom it is
contracting hereunder) has not been based upon any verbal or
written representations as to fact or otherwise made by or on
behalf of the Agent or the Company;
(c) to the best of its knowledge, the sale of the Special Warrants
was not accompanied by any advertisement in printed media of
general and regular paid circulation, radio or television or
otherwise; and
(d) it (or others for whom it is contracting hereunder) has been
independently advised as to applicable resale restrictions in
the jurisdiction in which it resides, confirms that no
representation has been made to it by or on behalf of the Agent
or the Company with respect thereto, acknowledges that it is
aware of the characteristics of the Special Warrants, the risks
relating to an investment therein and of the fact that it (or
others for whom it is contracting hereunder) may not be able to
resell the Special Warrants or Shares except in accordance with
exemptions under applicable securities legislation and
regulatory policy and that if it (or others for whom it is
contracting hereunder) exercises the Special Warrants prior to
the issuance of final receipt for a prospectus in the Filing
Jurisdictions, the Shares acquired may be subject to applicable
resale restrictions in the Filing Jurisdictions.
6. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE SUBSCRIBER
The Subscriber (on its own behalf or on behalf of others for
whom it is contracting hereunder) hereby represents, warrants and covenants to
the Agent and the Company, which representations and warranties shall survive
the Closing, that:
(a) the Subscriber is purchasing sufficient Special Warrants so that
the aggregate acquisition cost of the Special Warrants to the
Subscriber is not less than Cdn.$97,000;
(b) the Subscriber is purchasing as principal and is not a
corporation, partnership, trust, fund, association, or any other
organized group of persons created, or used
26
-6-
primarily, to permit the purchase of the Special Warrants (or
other similar purchases) by a group of individuals whose
individual share of the aggregate acquisition cost of the
Special Warrants is less than Cdn.$97,000 or, if not purchasing
the Special Warrants as principal, is duly authorized to enter
into this Agreement and to execute all documentation in
connection with the purchase on behalf of each beneficial
purchaser, it acknowledges that the Company may in the future be
required by law to disclose on a confidential basis to
securities regulatory authorities the identity of each
beneficial purchaser of Special Warrants for whom it may be
acting, and is a portfolio manager in a jurisdiction other than
Canada, provided that the total asset value of the investment
portfolio it manages on behalf of its clients is not less than
Cdn.$20,000,000 and it is purchasing the Special Warrants as an
agent or trustee for accounts that are fully managed by it;
(c) no prospectus has been filed by the Company with the British
Columbia Securities Commission in connection with the issuance
of the Special Warrants, the issuance is exempted from the
prospectus requirements of the Securities Act (British Columbia)
(the "Act"), and that:
(i) the Subscriber is restricted from using most of the
civil remedies available under the Act;
(ii) the Subscriber may not receive information that would
otherwise be required to be provided to him or her under
the Act; and
(iii) the Company is relieved from certain obligations that
would otherwise apply under the Act;
(d) if the Subscriber is a syndicate, partnership or other form of
unincorporated organization, every participant in the syndicate,
partnership or unincorporated organization would have an
aggregate acquisition cost of not less than Cdn.$97,000 for the
Special Warrants purchased if the participant were acquiring its
proportionate interest in the Special Warrants purchased;
(e) subject to paragraph 6(d) above, if the Subscriber is not an
individual or a corporation, each member of the partnership,
syndicate or other unincorporated organization which is the
beneficial purchaser, or each beneficiary of the trust which is
the beneficial purchaser, as the case may be, is an individual
who has an aggregate acquisition cost of not less than
Cdn.$97,000 for the Special Warrants;
(f) if the Subscriber is an individual, he or she has attained the
age of majority and in every case he or she is legally competent
to execute this Agreement and to take all actions required
pursuant hereto;
(g) if the Subscriber is other than an individual, it is legally
competent to execute this Agreement and to take all actions
required pursuant thereto and all approvals necessary for the
Subscriber to do so have been obtained;
27
-7-
(h) the Subscriber acknowledges that as the Special Warrants are
subject to a hold period under applicable British Columbia
securities legislation, the Company will be required to legend
the Special Warrant Certificate and certificates representing
the Shares (in the event such Shares are acquired prior to the
issuance of a receipt by the securities regulatory authorities
in the Filing Jurisdictions for the Prospectus) in substantially
the following form:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A
HOLD PERIOD AND MAY NOT BE TRADED IN BRITISH COLUMBIA UNTIL
SEPTEMBER __, 1999 EXCEPT AS PERMITTED BY THE SECURITIES ACT OF
BRITISH COLUMBIA AND THE RULES MADE THEREUNDER.";
(i) the Subscriber (or the others for whom it is contracting
hereunder) is resident in the jurisdiction set out on the first
page of this Agreement;
(j) if the Subscriber (or the others for whom it is contracting
hereunder) trades the Securities before receipts for the final
Prospectus are obtained, it will comply with the securities
legislation respecting such trades in the jurisdiction within
which such Subscriber (or the others for whom it is contracting
hereunder) resides and sells the Securities and, in the Filing
Jurisdictions, other applicable securities laws;
(k) this Agreement has been duly executed and delivered by the
Subscriber and constitutes a valid and binding agreement of the
Subscriber enforceable against the Subscriber;
(l) no offer of Special Warrants was made to the Subscriber (or the
others for whom it is contracting hereunder) in the "United
States" (as defined in Regulation S under the United States
Securities Act of 1933 (the "1933 Act"), the Subscriber is not a
"U.S. Person" (as defined in Regulation S) and is executing this
Agreement outside the United States;
(m) the activities of the Subscriber (or the others for whom it is
contracting hereunder) contemplated hereunder are not a scheme
to avoid the registration requirements of the 1933 Act;
(n) no person has made to the Subscriber any written or oral
representation:
(i) that any person will resell or repurchase the Special
Warrants or the Shares;
(ii) that any person will refund the purchase price of the
Special Warrants;
(iii) as to the future price of the Special Warrants or the
Shares; or
(iv) that the Special Warrants or Shares will be listed and
posted for trading on a stock exchange or that
application has been made to list and post the
28
-8-
Special Warrants or Shares for trading on a stock
exchange, apart from an application to list the Shares
on The Toronto Stock Exchange and the American Stock
Exchange;
(o) the delivery of this Agreement, the acceptance of it by the
Company, the issuance of the Special Warrants to the Subscriber
and the acquisition of the Shares upon exercise of the Special
Warrants comply with all applicable laws of the Subscriber's
jursidiction of residence or domicile and all other applicable
laws and will not cause the Company to become subject to or
comply with any disclosure, prospectus or reporting requirements
under any such applicable laws;
(p) the Subscriber (and the others for whom it is contracting
hereunder) has no intention to distribute, and shall not
transfer, either directly or indirectly any of the Special
Warrants or the Shares to any person within the United States or
to U.S. persons (as defined in Regulation S under the 0000 Xxx)
within 90 days from the Closing; and
(q) it has such knowledge in financial and business affairs as to be
capable of evaluating the merits and risks of its investment and
it, or, where it is not purchasing as principal, each beneficial
purchaser, is able to bear the economic risk of loss of its
investment.
7. RELIANCE UPON REPRESENTATIONS, WARRANTIES AND COVENANTS
The Subscriber acknowledges that the representations and
warranties and covenants contained in this Agreement are made with the intent
that they may be relied upon by the Company and the Agent in determining its
eligibility to purchase the Special Warrants and the Subscriber hereby agrees to
indemnify the Company and the Agent against all losses, claims, costs, expenses
and damages or liabilities which they may suffer or incur that are caused by or
arise from the reliance thereon by the Company and the Agent. The Subscriber
further agrees that by accepting the Special Warrants the Subscriber shall be
representing and warranting that the foregoing representations and warranties
are true as at the Closing with the same force and effect as if they had been
made by the Subscriber at the Closing and that they shall survive the purchase
by the Subscriber of the Special Warrants and shall continue in full force and
effect notwithstanding any subsequent disposition of the Special Warrants or the
Shares.
8. ACKNOWLEDGEMENT
THE SUBSCRIBER ACKNOWLEDGES THAT THE SUBSCRIBER HAS RECEIVED
SUCH INDEPENDENT ADVICE FROM INDEPENDENT LEGAL, ACCOUNTING AND TAX PROFESSIONAL
ADVISORS AS THE SUBSCRIBER HAS DETERMINED NECESSARY TO MAKE A DECISION TO
PURCHASE THE SPECIAL WARRANTS.
9. REPRESENTATIONS AND WARRANTIES OF THE COMPANY
29
-9-
The Company agrees that the Subscriber shall have the benefit of
each and all of the representations and warranties made by the Company to the
Agent in the Agency Agreement, with the same effect as if such representations
and warranties were repeated herein and made to the Subscriber, and acknowledges
that the Subscriber is relying upon such representations and warranties in
entering into this Agreement. The Company will, upon request of the Subscriber
and without charge, provide the Subscriber with an extract from the Agency
Agreement setting forth all such representations and warranties.
10. CONTRACTUAL RIGHT OF ACTION FOR RESCISSION
In the event that a holder of Special Warrants, who acquires
Shares upon the exercise of the Special Warrants as provided for in the
Prospectus, is or becomes entitled under the Securities Act of British Columbia,
to the remedy of rescission by reason of the Prospectus or any amendment thereto
containing a misrepresentation, such holder shall, subject to available defences
and any limitation period under applicable securities legislation, be entitled
to rescission not only of the holder's exercise of its Special Warrants but also
of this Agreement pursuant to which the Special Warrants were initially
acquired, and shall be entitled in connection with such rescission to a full
refund from the Company of all consideration paid on the acquisition of the
Special Warrants. In the event such holder is a permitted assignee of the
interest of the original Special Warrant subscriber, such permitted assignee
shall be entitled to exercise the rights of rescission and refund granted
hereunder as if such permitted assignee were such original subscriber. The
foregoing is in addition to any other right or remedy available to a holder of
Special Warrants under section 131 of the Act (or equivalent provisions of the
securities laws of other provinces in Canada) or otherwise at law.
11. APPOINTMENT OF AGENT
The Subscriber, on its own behalf and on behalf of others for
whom it is contracting hereunder, hereby:
(a) irrevocably authorizes the Agent to negotiate and settle the
form of the Special Warrant Indenture and any other agreement to
be entered into in connection with this transaction and to waive
on its own behalf and on behalf of the Subscribers in whole or
in part, or extend the time for compliance with, any of the
Closing conditions in such manner and on such terms and
conditions as the Agent may determine, acting reasonably,
without in any way affecting the Subscriber's obligations or the
obligations of such others hereunder;
(b) acknowledges and agrees that the Agent and the Company may vary,
amend, alter or waive, in whole or in part, one or more of the
conditions set forth in the Agency Agreement in such manner and
on such terms and conditions as they may determine, acting
reasonably, without affecting in any way the Subscriber or such
others' obligations hereunder; provided however, that the Agent
shall not vary, amend, alter or waive any such condition where
to do so would result in a material change to any of the
material attributes of the Special Warrants described herein;
and
30
-10-
(c) irrevocably authorizes the Agent to swear, execute, file and
record any documents necessary to accept delivery of the Special
Warrants at the Closing and to terminate this Agreement on
behalf of the Subscriber in the event that any condition
precedent to the offering has not been satisfied.
Should the Offering be over subscribed, the number of Special
Warrants subscribed for shall be allocated to the Subscriber in the discretion
of the Company. The Agent shall be authorized to amend the information contained
herein to reduce the number of Special Warrants subscribed for and the
Subscription Price to reflect the number of Special Warrants allocated to the
Subscriber and the Subscription Price therefor.
12. TERMINATION OF AGREEMENT
The Subscriber may terminate his or her subscription hereunder
if the Agent terminates its obligations under the Agency Agreement, and hereby
irrevocably constitutes the Agent as his or her attorney for purposes of
notifying the Company of such termination.
13. COMMISSION TO THE AGENT
The Subscriber acknowledges and agrees that the gross proceeds
derived from the sale of the Special Warrants less the Cash Commission (as
defined below) shall be paid to the Company on the Closing. The Subscriber
understands that upon completion of the Offering, the Agent will receive from
the Company a cash commission (the "Cash Commission") equal to 8% of the
Subscription Price of the Special Warrants to be sold under this offering to
Subscribers. Agent's special warrants (the "Agent's Option") exercisable to
acquire Agent's warrants to purchase that number of Shares equal to 10% of the
Shares issuable upon the exercise of Special Warrants will be issued to the
Agent or according to the Agent's direction. No other fee or commission is
payable by the Company in connection with the sale of the Special Warrants.
However, the Company will pay those fees and expenses in connection with the
offering as are set out in the Agency Agreement. The Agent and its directors,
officers, employees and affiliates may, from time to time, hold positions in
securities of the Company.
Both the Company and the Subscriber acknowledge that the Agent
is acting as agent in this transaction and the Subscriber hereby acknowledges
that all warranties, conditions, representations or stipulations, whether
express or implied and whether arising hereunder or under prior agreement or
statement or by statute or at common law are expressly those of the Company,
other that those relating solely to the Agent. The Subscriber acknowledges that
its decision to execute this Agreement and purchase the Special Warrants has not
been based upon any information or representation concerning the Company
provided to the Subscriber by the Company or the Agent other than those
contained in this Agreement and such as are contained in documents publicly
available in the Company's files at the offices of the British Columbia
Securities Commission or The Toronto Stock Exchange (the "Disclosure Record"),
and that the Subscriber is relying entirely upon this Agreement and the
Disclosure Record. Any information given or statement made is given or made
without liability or responsibility howsoever arising on the part of the Agent.
No person in the employment of, or acting as agent of, the Agent has any
authority to make or give any representation or warranty and the Company and the
Subscriber hereby release the Agent from any claims that may arise in respect
thereof.
31
-11-
14. COSTS
The Subscriber acknowledges and agrees that all costs and
expenses incurred by the Subscriber (including any fees and disbursements of any
special counsel retained by the Subscriber) relating to the purchase of the
Special Warrants shall be borne by the Subscriber, other than the Cash
Commission and Agent's Option which shall be borne by the Company as set out
above.
15. GOVERNING LAW
This Agreement is governed by the laws of the Province of
British Columbia and the federal laws of Canada applicable therein. The
Subscriber, in his or her personal or corporate capacity and, if applicable, on
behalf of each beneficial purchaser for whom he is acting, irrevocably attorns
to the jurisdiction of the courts of the Province of British Columbia.
16. SURVIVAL
This Agreement, including without limitation the
representations, warranties and covenants contained herein, shall survive and
continue in full force and effect and be binding upon the Subscriber
notwithstanding the completion of the purchase of the Special Warrants by the
Subscriber pursuant hereto, the completion of the issue of Special Warrants and
the Shares and any subsequent disposition by the Subscriber of the Special
Warrants or Shares.
17. ASSIGNMENT
This Agreement is not transferable or assignable.
18. TIME IS OF THE ESSENCE
For the purposes of this Agreement, time is of the essence.
19. COUNTERPARTS
This Agreement may be executed in as many counterparts as may be
necessary and by facsimile, each of such counterparts so executed will be deemed
to be an original and such counterparts together will constitute one and the
same instrument and notwithstanding the date of execution will be deemed to bear
the date as of the day and year first above written.
32
EXHIBIT A
INSTRUCTION SHEET - COMPLETING THE SUBSCRIPTION AGREEMENT
(i) FIRST PARAGRAPH OF FACE PAGE - insert the number of securities
being purchased and the total purchase price;
(i) "EXECUTION BY SUBSCRIBER" IF AN INDIVIDUAL:
- to the left - sign on first line;
- to the right - print the name of the Subscriber on the first
line and the residential address of the Subscriber on the second
line. Do not complete the Name of Contact Person, but provide
your telephone and fax numbers on the last two lines;
(iii) "EXECUTION BY SUBSCRIBER" IF NOT AN INDIVIDUAL (e.g. a
corporation, partnership or trust):
- to the left - have the authorized signatory of the Subscriber
sign on the first line;
- to the right - print the name of the Subscriber on the first
line and the address of the Subscriber on the second line. Print
the name of the person that the Company should call if it has
any questions regarding the subscription documents on the third
line and provide his or her telephone and fax numbers on the
last two lines;
(iv) MIDDLE OF FACE PAGE - insert the date that the Subscription
Agreement was executed;
(v) "REGISTRATION INSTRUCTIONS" - only complete this section if the
certificates for the securities are to be registered in the name
of a nominee (such as your financial institution, broker or
RRSP);
(vi) "DELIVERY INSTRUCTIONS" - only complete this section if the
certificates for the securities are to be delivered to an
address that is different from the address of the Subscriber;
(vii) REMAINING LINES (Accepted date lines and signature line for the
Company) - leave these lines blank.
33
EXHIBIT B
Form P1
THE TORONTO STOCK EXCHANGE
PRIVATE PLACEMENT QUESTIONNAIRE AND UNDERTAKING
To be completed by each proposed private placement purchaser of listed
securities or securities which are convertible into listed securities.
QUESTIONNAIRE
1. DESCRIPTION OF TRANSACTION
(a) Name of issuer of the securities: Genetronics Biomedical Ltd.
-------------------------------
(b) Number and class of securities to be purchased: Special Warrants
-----------------
(c) Purchase Price: US$3.00 per Special Warrant
-------------------------------------------------
2. DETAILS OF PURCHASER
(a) Name of purchaser:
----------------------------------------------
(b) Address:
--------------------------------------------------------
(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 qualifies as 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:
------------------------------------------------------------------------
------------------------------------------------------------------------
34
2
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 closing of the transaction herein or until a receipt is
issued by the British Columbia Securities Commission for a Prospectus qualifying
the issue of Shares on exercise of the Special Warrants, without the prior
consent of The Toronto Stock Exchange and any other regulatory body having
jurisdiction.
Dated at
---------------------- -----------------------------------
on , 1999 (Name of Purchaser-please print)
----------------------
------------------------------------
(Authorized Signature)
------------------------------------
(Official Capacity-please print)
(Please print here name of
individual whose signature appears
above, if different from name of
purchaser printed above)
35
EXHIBIT C
This is the form required under section 135 of the Rules and, if applicable, by
an order issued under section 76 of the Securities Act
FORM 20A (IP)
SECURITIES ACT
ACKNOWLEDGEMENT OF INDIVIDUAL PURCHASER
1. I have agreed to purchase from Genetronics Biomedical Ltd. (the
"Issuer") ________________ Special Warrants (the "Securities") of the
Issuer. Each Special Warrant is exercisable to acquire one common share
of the Issuer.
2. I am purchasing the Securities as principal and, on closing of the
agreement of purchase and sale, I will be the beneficial owner of the
Securities.
3. I [CIRCLE ONE] have/have not received an offering memorandum describing
the Issuer and the Securities.
4. I acknowledge that:
(a) no securities commission or similar regulatory authority has
reviewed or passed on the merits of the Securities, AND
(b) there is no government or other insurance covering the
Securities, AND
(c) I may lose all of my investment, AND
(d) there are restrictions on my ability to resell the Securities
and it is my responsibility to find out what those restrictions
are and to comply with them before selling the Securities, AND
(e) I will not receive a prospectus that the British Columbia
Securities Act (the "Act") would otherwise require be given to
me because the Issuer has advised me that it is relying on a
prospectus exemption, AND
(f) because I am not purchasing the Securities under a prospectus, I
will not have the civil remedies that would otherwise be
available to me, AND
(g) the Issuer has advised me that it is using an exemption from the
requirement to sell through a dealer registered under the Act,
except purchases referred to in paragraph 5(g) and as a result I
do not have the benefit of any protection that might have been
available to me by having a dealer act on my behalf.
5. I also acknowledge that: [CIRCLE ONE]
(a) I am purchasing Securities that have an aggregate acquisition
cost of $97,000 or more, OR
(b) my net worth, or my net worth jointly with my spouse at the date
of the agreement of purchase and sale of the security, is not
less than $400,000, OR
36
2
(c) my annual net income before tax is not less than $75,000, or my
annual net income before tax jointly with my spouse is not less
than $125,000, in each of the two most recent calendar years,
and I reasonably expect to have annual net income before tax of
not less than $75,000 or annual net income before tax jointly
with my spouse of not less than $125,000 in the current calendar
year, OR
(d) I am registered under the Act, OR
(e) I am a spouse, parent, brother, sister or child of a senior
officer or director of the Issuer, or of an affiliate of the
Issuer, OR
(f) I am a close personal friend of a senior officer or director of
the Issuer, or of an affiliate of the Issuer, OR
(g) I am purchasing securities under section 128(c) ($25,000 -
registrant required) of the Rules, and I have spoken to a person
[NAME OF REGISTERED PERSON: ___________________________ (THE
"REGISTERED PERSON")] who has advised me that the Registered
Person is registered to trade or advise in the Securities and
that the purchase of the Securities is a suitable investment for
me.
6. If I am an individual referred to in paragraph 5(b), 5(c), or 5(d), I
acknowledge that, on the basis of information about the Securities
furnished by the Issuer, I am able to evaluate the risks and merits of
the Securities because: [CIRCLE ONE]
(a) of my financial, business or investment experience, OR
(b) I have received advice from a person [NAME OF ADVISER:
______________________ (THE "ADVISER")] who has advised me that
the Adviser is:
(i) registered to advise, or exempted from the requirement
to be registered to advise, in respect of the
Securities, and
(ii) not an insider of, or in a special relationship with,
the Issuer.
The statements made in this report are true.
DATED ________________, 1999.
------------------------------------
Signature of the Purchaser
------------------------------------
Name of Purchaser
------------------------------------
Address of Purchaser
37
INSTRUCTION SHEET - FORM 20A(IP)
- Item 1 - insert number of securities being purchased;
- Item 3 - if you have received an offering memorandum, circle "have"; if
you have not received an offering memorandum, circle "have not";
- Item 5 - if you are purchasing securities that have cost you at least
$97,000, circle item (a); if you are purchasing securities that have
cost you less than $97,000, CIRCLE ONE of items (b), (c), (e), (f) or
(g) only and, if you circle (g), print in the space provided the name of
the individual broker or adviser and the name of the firm at which he or
she works;
NOTE: If items (a), (b), (c), (e), (f) or (g) do not apply, then
you may not lawfully purchase securities under this offering.
- Item 6 - IF you circled (b) or (c) in Item 5, complete Item 6 by
circling (a) or (b). If you circle (b), print in the space provided the
name of the individual adviser and the name of the firm at which he or
she works;
- Remaining lines on page 2 - sign above Signature of Purchaser, date and
clearly print name and address of the Purchaser.
38
EXHIBIT D
CERTIFICATION BY FOREIGN PORTFOLIO MANAGER
The undersigned is purchasing securities of Genetronics Biomedical Ltd. (the
"Issuer").
The undersigned hereby certifies that:
(a) it is purchasing securities of the Issuer on behalf of managed accounts
over which it has absolute discretion as to purchasing and selling, and
in respect of which it receives no instructions from any person
beneficially interested in such accounts or from any other person;
(b) it carries on the business of managing the investment portfolios of
clients through discretionary authority granted by those clients (a
"portfolio manager" business) in ____________________ [jurisdiction],
and it is permitted by law to carry on a portfolio manager business in
that jurisdiction;
(c) it was not created solely or primarily for the purpose of purchasing
securities of the Issuer;
(d) the total asset value of the investment portfolios it manages on behalf
of clients is not less than $20,000,000;
(e) it does not believe, and has no reasonable grounds to believe, that any
resident of British Columbia has a beneficial interest in any of the
managed accounts for which it is purchasing; and
(f) the Issuer has provided it with a list of the directors, senior officers
and other insiders of the Issuer, and the persons that carry on investor
relations activities for the Issuer (which list is attached as a
schedule to this Form), and it does not believe, and has no reasonable
grounds to believe, that any of those persons has a beneficial interest
in any of the managed accounts for which it is purchasing, except as
follows:
_________________________________________________ (name of insider(s) or
person(s) carrying on investor relations activities for the Issuer that
have a beneficial interest in an account.)
The undersigned acknowledges that it is bound by the provisions of the British
Columbia Securities Act including, without limitation, sections 87 and 111
concerning the filing of insider reports and reports of acquisitions.
Dated at ____________________________________ this _____ day of _________, 1999.
------------------------------------
(Name of Purchaser - please print)
------------------------------------
(Authorized Signature)
------------------------------------
(Official Capacity - please print)
(please print name of individual
whose signature appears above, if
different from name of purchaser
printed above)
39
SCHEDULE TO EXHIBIT D - CERTIFICATION BY FOREIGN PORTFOLIO MANAGER
LIST OF DIRECTORS, SENIOR OFFICERS AND OTHER INSIDERS
OF THE COMPANY AND OTHER PERSONS THAT CARRY ON
INVESTOR RELATIONS ACTIVITIES FOR THE COMPANY
Xxxx X. Xxxxxxxx
Xxxxxx Xxxxxxx
Xxxxxx Xxxx
Xxxxx X. Xxxxxxx
Xxxxxxx Xxxx
Xxxx Xxxxxxx
Xxxxxx X. Politeski
Xxxxx Xxxxxxx
Xxxxx Xxxxxxx
Xx Xxxxxx
Xxxxxxx Xxxxxxxx
Xxxxxxx XxXxxxx
Xxxxxx Xxxxxxx
E. Xxxxxx Xxx-Xxxxxxx
Xxxxxx Xxxxxxxx
Xxxxxx DeKertanguy
Miles Lewis
Xxxxxxx XxXxxxx
Xxxxx Xx Xxxx
Xxxx Xxxxxx
40
INSTRUCTION SHEET - CERTIFICATION BY FOREIGN PORTFOLIO MANAGER
- Item (b) - insert name of jurisdiction.
- Item (f) - insert name of insider(s) or person(s) carrying on investor
relations activities for the Issuer that have a beneficial interest in
an account.
- Insert name of city and country and date.
- Clearly print name of purchaser, sign above Authorized Signature, insert
official capacity and print name of individual whose signature appears
on Authorized Signature line, if different from name of purchase
printed.
41
SCHEDULE "B"
SUBSCRIPTION AGREEMENT
(THE "AGREEMENT")
The undersigned (the "Subscriber") hereby subscribes for and agrees to purchase
_____________________ special warrants (the "Special Warrants") of Genetronics
Biomedical Ltd. (the "Company") at a price of US$3.00 per Special Warrant for
aggregate proceeds of US$_____________________ (the "Subscription Price"), all
on the terms and subject to the conditions set forth in Schedule A attached
hereto and in the Agency Agreement and the Special Warrant Indenture (each as
defined herein).
EXECUTION BY SUBSCRIBER
------------------------------------
Name of Subscriber
------------------------------------
Address of Subscriber
Signature of Individual Subscriber or
Authorized Signatory of Subscriber ------------------------------------
(if Subscriber is NOT an individual) Name of Contact Person, if
Subscriber not an individual
( )
------------------------------------
Telephone Number of Subscriber or
Contact Person
( )
------------------------------------
Facsimile Number of Subscriber or
Contact Person
EXECUTED BY THE SUBSCRIBER THIS __________ DAY OF _________________, 1999.
PLEASE COMPLETE THE FOLLOWING SECTION IF YOU REQUIRE THE CERTIFICATE(S)
REPRESENTING THE SECURITIES TO APPEAR IN THE NAME OF AN INTERMEDIARY, SUCH AS
YOUR BROKER, OR REQUIRE THE CERTIFICATE(S) TO BE DELIVERED TO AN ADDRESS OTHER
THAN THAT SHOWN ABOVE.
------------------------------------ ------------------------------------
REGISTRATION INSTRUCTIONS DELIVERY INSTRUCTIONS
------------------------------------ ------------------------------------
Name to appear on certificate(s) Name and account reference, if
applicable
------------------------------------ ------------------------------------
Account reference, if applicable Contact Person
------------------------------------ ------------------------------------
Address of Intermediary Address for Delivery
------------------------------------
Telephone Number of Contact Person
ACCEPTED by the Company this __________ day of ________________, 1999.
GENETRONICS BIOMEDICAL LTD.
Per: __________________________________
Authorized Signatory
42
SCHEDULE A
In consideration of the covenants and agreements herein, and the payment of one
dollar made by each party to the other, the receipt and sufficiency of which is
acknowledged by each party, the parties agree as follows:
1. DESCRIPTION OF SPECIAL WARRANTS
The Special Warrants will be transferable and will be issued pursuant to
an indenture to be made between the Company and Montreal Trust Company of Canada
(the "Special Warrant Indenture") and shall entitle the holders thereof to
receive, without additional payment, upon exercise of the Special Warrants, one
common share (a "Share") of the Company for each Special Warrant held.
The Special Warrants will be exercisable at any time on or before 4:30
p.m. (Vancouver time) (the "Expiry Time"), on the day which is the earlier of:
(a) 12 months from the Closing (as defined below); and (b) the day which is five
business days after a receipt for a final prospectus (the "Prospectus")
qualifying the issuance of the Shares issuable upon due exercise of the Special
Warrants has been issued by the securities regulatory authorities in British
Columbia and such other Provinces in Canada that the Agent reasonably requires
(collectively, the "Canadian Filing Jurisdictions"). Special Warrants not
expressly exercised by the holders thereof prior to the Expiry Time shall be
deemed to have been so exercised immediately prior thereto.
The Company has covenanted and agreed to, among other things, use its
reasonable best efforts to finalize and obtain a receipt for the Prospectus in
each of the Canadian Filing Jurisdictions, and to file and to have declared
effective, a registration statement or similar document (the "Registration
Statement") in compliance with the United States Securities Act of 1933 (the
"U.S. Securities Act") to register the resale by the Subscriber of the Shares
held by the Subscriber pursuant to the exercise of the Special Warrants, no
later than 5:00 p.m. (Vancouver time) on the day which is 90 days from Closing
(the "Qualification Deadline").
IN THE EVENT THAT THE COMPANY IS UNABLE TO OBTAIN A RECEIPT FOR THE
PROSPECTUS IN ANY OF THE CANADIAN FILING JURISDICTIONS, THE SPECIAL WARRANTS AND
THE SHARES (COLLECTIVELY, THE "SECURITIES") WILL BE SUBJECT TO STATUTORY HOLD
PERIODS DURING WHICH, SUBJECT TO THE AVAILABILITY OF ANOTHER EXEMPTION, THE
SECURITIES MAY NOT BE RESOLD IN SUCH CANADIAN FILING JURISDICTIONS. IN THE EVENT
THE REGISTRATION STATEMENT IS NOT DECLARED EFFECTIVE, THEN THE SECURITIES MAY
ONLY BE RESOLD PURSUANT TO APPLICABLE EXEMPTIONS FROM REGISTRATION PURSUANT TO
UNITED STATES FEDERAL, STATE AND LOCAL SECURITIES LAWS. IN ADDITION, ANY SHARES
OBTAINED PURSUANT TO THE EXERCISE OF SPECIAL WARRANTS PRIOR TO THE ISSUANCE OF
RECEIPTS FOR THE PROSPECTUS BY THE SECURITIES COMMISSIONS IN THE CANADIAN FILING
JURISDICTIONS OR THE DECLARATION OF EFFECTIVENESS OF THE REGISTRATION STATEMENT
WILL BE SUBJECT TO STATUTORY RESTRICTIONS ON RESALE. THE COMPANY IS A REPORTING
ISSUER IN BRITISH COLUMBIA AND ONTARIO. THE COMPANY IS A REPORTING COMPANY UNDER
THE UNITED STATES SECURITIES EXCHANGE ACT OF 1934. THE COMPANY IS NOT A
REPORTING ISSUER OR A REPORTING COMPANY IN ANY OTHER JURISDICTION. A HOLDER
RESIDENT IN ANOTHER JURISDICTION MAY BE SUBJECT TO DIFFERENT AND LONGER RESALE
RESTRICTIONS. RESIDENTS OF SUCH OTHER JURISDICTIONS ARE URGED TO CONSULT WITH
COUNSEL THEREIN ABOUT APPLICABLE RESALE RESTRICTIONS.
IT IS A FURTHER PROVISION OF THE SPECIAL WARRANT INDENTURE THAT THE
AGGREGATE PROCEEDS OF THE SALE OF THE SPECIAL WARRANTS (THE "PROCEEDS"), WILL BE
DELIVERED TO THE COMPANY AT THE CLOSING (AS DEFINED BELOW).
43
3
THE TERMS AND CONDITIONS WHICH GOVERN THE SPECIAL WARRANTS ARE CONTAINED
IN THE SPECIAL WARRANT INDENTURE WHICH CONTAINS, AMONG OTHER THINGS,
ANTI-DILUTION PROVISIONS AND PROVISIONS FOR THE APPROPRIATE ADJUSTMENT IN THE
CLASS, NUMBER AND PRICE OF THE SHARES UPON THE OCCURRENCE OF CERTAIN EVENTS,
INCLUDING ANY SUBDIVISION, CONSOLIDATION OR RECLASSIFICATION OF THE SHARES OR
PAYMENTS OF STOCK DIVIDENDS OR THE AMALGAMATION OR OTHER SUBSTANTIAL
REORGANIZATION OF THE COMPANY.
The Special Warrants herein subscribed for form part of a larger
offering (the "Offering") consisting of both an offering to United States
residents under Regulation D and an offering to non-U.S. residents under
Regulation S and applicable exemptions under applicable Canadian securities
laws, of up to 4,500,000 Special Warrants to be issued by the Company pursuant
to an agency agreement (the "Agency Agreement") between the Company and
Canaccord International (L) Corporation (the "Agent").
The foregoing description of the Special Warrants is a summary only and
is subject to the detailed provisions of the Special Warrant Indenture under
which they are to be issued.
2. PAYMENT
The Subscription Price must be paid by wire transfer of funds in United
States dollars at par.
3. REGISTRATION AND DELIVERY INSTRUCTIONS
The Subscriber must complete, sign and return by courier to Canaccord
Capital Corporation of X.X. Xxx 00000, 2200 - 000 Xxxxxxxxx Xxxxxx, Xxxxxxxxx,
Xxxxxxx Xxxxxxxx, X0X 0X0:
(a) an executed copy of this Agreement;
(b) delivery instructions attached hereto;
(c) Toronto Stock Exchange Questionnaire and Undertaking in the form
attached as Exhibit A;
(d) a completed and executed copy of the Investor Qualification
Questionnaire, attached as Exhibit B;
(e) an Undertaking of Foreign Portfolio Manager, attached as Exhibit
C; and
(f) confirmation of a wire transfer of the Subscription Price to:
Bank of Montreal
Montreal, Quebec
Swift: XXXXXXX0
Account: 0004 0000000
Beneficiary: Canaccord Capital Corp.
Client Name: Canaccord International Corporation
Client Account Number: 252-974B-9
in the amount of the Subscription Price.
44
4
The Subscriber (or if applicable, others for whom it is contracting
hereunder) 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 of the Subscriber by regulatory authorities and applicable
law.
4. CLOSING
The closing of the transactions contemplated herein will be completed at
the offices of Catalyst Corporate Finance Lawyers at Xxxxx 0000, 0000 Xxxx
Xxxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxx Xxxxxxxx, X0X 0X0 or at such other place as
the Company and the Agent shall agree, at 10:00 a.m. (Vancouver Time) on the
date upon which the Company and the Agent agree (the "Closing").
This executed Agreement is open for acceptance in whole or in part by
the Company in its sole discretion in each case or at any time prior to the
Closing. Confirmation of acceptance or rejection of a subscription will be
forwarded to the Subscriber promptly after acceptance or rejection has been
made. If this Agreement is rejected in whole and if the Subscriber has delivered
a certified cheque or bank draft representing the Subscription Price for the
Special Warrants, then such cheque or bank draft will be promptly returned to
the Subscriber without deduction or interest. If this Agreement is accepted only
in part and the Subscriber has delivered a certified cheque or bank draft as
aforesaid, a cheque representing the portion of the Subscription Price for that
portion of the Subscriber's subscription for Special Warrants which is not
accepted will be promptly returned to the Subscriber without interest.
Certificates representing the Special Warrants (individually, a "Special
Warrant Certificate", and collectively, the "Special Warrant Certificates") will
be available for delivery at the Closing against payment of the aggregate
Subscription Price in the manner specified above. If the Subscriber does not
choose to attend the Closing to receive the Special Warrant Certificate
representing the Special Warrants subscribed for herein, then the Subscriber, on
its own behalf or on behalf of others for whom it is contracting hereunder,
hereby appoints the Agent, with full power of substitution, as its true and
lawful attorney and agent with the full power and authority in its place and
stead to swear, execute, file and record any document necessary to accept
delivery of the Special Warrants at the Closing, to terminate this Agreement on
its behalf in the event that any condition precedent to the offering has not
been satisfied, to execute a receipt for the Special Warrants and any other
documentation, modify or waive any conditions or grant any waivers on its behalf
in connection with this transaction, and to deliver Special Warrant Certificates
to the Subscriber at the address set forth above promptly after the Closing.
5. PROSPECTUS/REGISTRATION EXEMPTIONS
The sale and delivery of the Special Warrants to the Subscriber (or
others for whom it is contracting hereunder) is conditional upon such sale being
exempt from the requirement to file a prospectus or registration statement, as
defined in applicable securities legislation.
The Subscriber on its own behalf (or on behalf of others for whom it is
contracting hereunder, if applicable) acknowledges and agrees that:
(a) its decision to execute this Agreement and purchase the Special
Warrants (on its own behalf or on behalf of those for whom it is
contracting hereunder) has not been based upon any verbal or
written representations as to fact or otherwise made by or on
behalf of the Agent or the Company;
45
5
(b) to the best of its knowledge, the sale of the Special Warrants
was not accompanied by any advertisement in printed media of
general and regular paid circulation, radio or television or
otherwise;
(c) it (or others for whom it is contracting hereunder) has been
independently advised as to applicable resale restrictions in
the jurisdiction in which it resides, confirms that no
representation has been made to it by or on behalf of the Agent
or the Company with respect thereto, acknowledges that it is
aware of the characteristics of the Special Warrants, the risks
relating to an investment therein and of the fact that it (or
others for whom it is contracting hereunder) may not be able to
resell the Special Warrants or Shares except in accordance with
exemptions under applicable securities legislation and
regulatory policy and that if it (or others for whom it is
contracting hereunder) exercises the Special Warrants prior to
the issuance of final receipt for a prospectus in the Canadian
Filing Jurisdictions or the effectiveness of the Registration
Statement in the United States, the Shares acquired may be
subject to applicable resale restrictions;
(d) it is an accredited investor ("Accredited Investor") within the
meaning of Regulation D under the U.S. Securities Act and is
acquiring the Special Warrants for its own account for
investment only or for the account of an Accredited Investor as
to which it exercises sole investment discretion and not with a
view towards their distribution and has duly completed and
executed a true and accurate United States Subscription
Agreement Questionnaire attached as Exhibit B;
(e) it agrees that if it decides to offer, sell or otherwise
transfer any of the Special Warrants or Shares, it will not
offer, sell or otherwise transfer any of such securities,
directly or indirectly, unless (i) the sale is to the Company;
or (ii) the sale is made outside the United States in compliance
with the requirements of Rule 904 of Regulation S under the U.S.
Securities Act ("Regulation S"); or (iii) the sale is made
pursuant to an exemption from registration under the U.S.
Securities Act provided by Rule 144A or Rule 144 thereunder, if
applicable, and in compliance with any applicable state
securities laws; or (iv) the sale is made under an effective
registration statement under the U.S. Securities Act; (f) it
consents to the Company making a notation on its records or
giving instructions to any transfer agent of the Special
Warrants or Shares in order to implement the restrictions on
transfer set forth and described herein.
6. RESTRICTIONS ON TRANSFER IN THE UNITED STATES.
The Subscriber agrees (on behalf of itself or others for whom it is contracting
hereunder) not to make any disposition of all or any portion of the Special
Warrants or the Shares within the United States unless and until:
(a) there is then in effect a registration statement under the U.S.
Securities Act covering such proposed disposition and such
disposition is made in accordance with such registration
statement; or
(b) (i) the transferee has agreed in writing to be bound by the
terms of this Agreement; (ii) the Subscriber shall have notified
the Company of the proposed disposition and shall have furnished
the Company with a statement of the circumstances surrounding
the
46
6
proposed disposition; and (iii) if reasonably requested by the
Company, the Subscriber shall have furnished the Company with an
opinion of counsel, reasonably satisfactory to the Company, that
such disposition will not require registration of such Shares
under the U.S. Securities Act. It is agreed that the Company
will not require opinions of counsel for transactions made
pursuant to Rule 144 or Rule 904 except in unusual
circumstances; or
(c) notwithstanding the provisions of paragraphs (a) and (b) above,
no such registration statement or opinion of counsel shall be
necessary for a transfer by a Subscriber which is: (i) a
partnership to its partners or former partners in accordance
with partnership interests; (ii) a corporation either to its
stockholders in accordance with their interest in the
corporation or to its affiliates; (iii) a limited liability
company to its members or former members in accordance with
their interest in the limited liability company; or (iv) to the
Subscriber's family member or trust for the benefit of an
individual Subscriber; provided that in each case the transferee
will be subject to the terms of this Agreement to the same
extent as if it were an original Subscriber hereunder.
Each certificate representing Special Warrants or Shares shall (unless otherwise
permitted by the provisions of the Agreement) be stamped or otherwise imprinted
with a legend substantially similar to the following (in addition to any legend
required under applicable state securities laws):
THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933 (THE "ACT") AND MAY NOT BE OFFERED,
SOLD OR OTHERWISE TRANSFERRED, ASSIGNED, PLEDGED OR HYPOTHECATED
UNLESS AND UNTIL REGISTERED UNDER THE ACT EXCEPT: (i) IN
COMPLIANCE WITH RULE 144 OR ANOTHER APPLICABLE EXEMPTION FROM
REGISTRATION UNDER SAID ACT; AND (ii) IF REQUESTED BY THE
COMPANY, THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL
REASONABLY SATISFACTORY TO THE COMPANY AND ITS COUNSEL THAT SUCH
REGISTRATION IS NOT REQUIRED.
The Company shall be obligated to reissue promptly unlegended certificates at
the request of any holder thereof if the Company can obtain an opinion that the
securities proposed to be disposed of may lawfully be so disposed of without
registration, qualification or legend. The Company agrees to use its best
efforts to obtain such opinion.
Any legend endorsed on an instrument pursuant to applicable state securities
laws and the stop-transfer instructions with respect to such securities shall be
removed upon receipt by the Company of an opinion of counsel reasonably
satisfactory to the Company.
7. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE SUBSCRIBER
The Subscriber understands that neither the Special Warrants nor
the Shares have been registered under the U.S. Securities Act. The Subscriber
also understands that the Special Warrants are being offered and sold pursuant
to an exemption from registration contained in the U.S. Securities Act based in
part upon the Subscriber's representations contained in this Agreement and the
attached Investor Qualification Questionnaire.
47
7
The Subscriber (on its own behalf or on behalf of others for whom it is
contracting hereunder) hereby represents, warrants and covenants to the Agent
and the Company, which representations and warranties shall survive the Closing,
that:
(a) the Subscriber is purchasing sufficient Special Warrants so that
the aggregate acquisition cost of the Special Warrants to the
Subscriber is not less than Cdn.$97,000;
(b) the Subscriber is purchasing as principal and is not a
corporation, partnership, trust, fund, association, or any other
organized group of persons created, or used primarily, to permit
the purchase of the Special Warrants (or other similar
purchases) by a group of individuals whose individual share of
the aggregate acquisition cost of the Special Warrants is less
than Cdn.$97,000 or, if not purchasing the Special Warrants as
principal, is duly authorized to enter into this Agreement and
to execute all documentation in connection with the purchase on
behalf of each beneficial purchaser, it acknowledges that the
Company may in the future be required by law to disclose on a
confidential basis to securities regulatory authorities the
identity of each beneficial purchaser of Special Warrants for
whom it may be acting, and is a portfolio manager in a
jurisdiction other than Canada, provided that the total asset
value of the investment portfolio it manages on behalf of its
clients is not less than Cdn.$20,000,000 and it is purchasing
the Special Warrants as an agent or trustee for accounts that
are fully managed by it;
(c) no prospectus has been filed by the Company with the British
Columbia Securities Commission in connection with the issuance
of the Special Warrants, the issuance is exempt from the
prospectus requirements of the Securities Act (British Columbia)
(the "Act"), and that:
(i) the Subscriber is restricted from using most of the
civil remedies available under the Act;
(ii) the Subscriber may not receive information that would
otherwise be required to be provided to him or her under
the Act; and
(iii) the Company is relieved from certain obligations that
would otherwise apply under the Act;
(d) if the Subscriber is a syndicate, partnership or other form of
unincorporated organization, every participant in the syndicate,
partnership or unincorporated organization would have an
aggregate acquisition cost of not less than Cdn.$97,000 for the
Special Warrants purchased if the participant were acquiring its
proportionate interest in the Special Warrants purchased;
(e) subject to paragraph 6(d) above, if the Subscriber is not an
individual or a corporation, each member of the partnership,
syndicate or other unincorporated organization which is the
beneficial purchaser, or each beneficiary of the trust which is
the beneficial purchaser, as the case may be, is an individual
who has an aggregate acquisition cost of not less than
Cdn.$97,000 for the Special Warrants;
48
8
(f) if the Subscriber is an individual, he or she has attained the
age of majority and in every case he or she is legally competent
to execute this Agreement and to take all actions required
pursuant hereto;
(g) if the Subscriber is other than an individual, it is legally
competent to execute this Agreement and to take all actions
required pursuant thereto and all approvals necessary for the
Subscriber to do so have been obtained;
(h) the Subscriber acknowledges that as the Special Warrants are
subject to a hold period under applicable British Columbia
securities legislation, the Company will be required to legend
the Special Warrant Certificate and certificates representing
the Shares (in the event such Shares are acquired prior to the
issuance of a receipt for the Prospectus by the securities
regulatory authorities in British Columbia in substantially the
following form:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A HOLD
PERIOD AND MAY NOT BE TRADED IN BRITISH COLUMBIA UNTIL SEPTEMBER __,
1999 EXCEPT AS PERMITTED BY THE SECURITIES ACT OF BRITISH COLUMBIA AND
THE RULES MADE THEREUNDER.";
(i) the Subscriber (or the others for whom it is contracting
hereunder) is resident in the jurisdiction set out on the first
page of this Agreement;
(j) if the Subscriber (or the others for whom it is contracting
hereunder) trades the Securities before receipts for the final
Prospectus are obtained, it will comply with the securities
legislation respecting such trades in the jurisdiction within
which such Subscriber (or the others for whom it is contracting
hereunder) resides and sells the Securities and all other
applicable securities laws;
(k) this Agreement has been duly executed and delivered by the
Subscriber and constitutes a valid and binding agreement of the
Subscriber enforceable against the Subscriber;
(l) no person has made to the Subscriber any written or oral
representation:
(i) that any person will resell or repurchase the Special
Warrants or the Shares;
(ii) that any person will refund the purchase price of the
Special Warrants;
(iii) as to the future price of the Special Warrants or the
Shares; or
(iv) that the Special Warrants or Shares will be listed and
posted for trading on a stock exchange or that
application has been made to list and post the Special
Warrants or Shares for trading on a stock exchange,
apart from an application to list the Shares on The
Toronto Stock Exchange and the American Stock Exchange;
(m) it has such knowledge in financial and business affairs as to be
capable of evaluating the merits and risks of its investment and
it, or, where it is not purchasing as principal, each beneficial
purchaser, is able to bear the economic risk of loss of its
investment.
49
9
(n) the Subscriber or, where it is not purchasing as principal, each
beneficial purchaser, has substantial experience in evaluating
and investing in private placement transactions of securities in
companies similar to the Company so that it is capable of
evaluating the merits and risks of its investment in the Company
and has the capacity to protect its own interests. The
Subscriber or, where it is not purchasing as principal, each
beneficial purchaser, must bear the economic risk of this
investment indefinitely unless the Special Warrants (or the
Shares) are registered pursuant to the U.S. Securities Act, or
an exemption from registration is available;
(o) by reason of its, or of its management's, business or financial
experience, the Subscriber has the capacity to protect its own
interests in connection with the transactions contemplated in
this Agreement. Further, the Subscriber is aware of no
publication of any advertisement in connection with the
transactions contemplated in the Agreement; and
(p) the Subscriber has had an opportunity to discuss the Company's
business, management and financial affairs with the management
of the Company and has had the opportunity to review the
Company's operations and facilities. The Subscriber has also had
the opportunity to ask questions of, and receive answers from,
the management of the Company regarding the terms and conditions
of this investment.
8. RELIANCE UPON REPRESENTATIONS, WARRANTIES AND COVENANTS
The Subscriber acknowledges that the representations and warranties and
covenants contained in this Agreement are made with the intent that they may be
relied upon by the Company and the Agent in determining its eligibility to
purchase the Special Warrants and the Subscriber hereby agrees to indemnify the
Company and the Agent against all losses, claims, costs, expenses and damages or
liabilities which they may suffer or incur that are caused by or arise from the
reliance thereon by the Company and the Agent. The Subscriber further agrees
that by accepting the Special Warrants the Subscriber shall be representing and
warranting that the foregoing representations and warranties are true as at the
Closing with the same force and effect as if they had been made by the
Subscriber at the Closing and that they shall survive the purchase by the
Subscriber of the Special Warrants and shall continue in full force and effect
notwithstanding any subsequent disposition of the Special Warrants or the
Shares.
9. ACKNOWLEDGEMENT
THE SUBSCRIBER ACKNOWLEDGES THAT THE SUBSCRIBER HAS RECEIVED SUCH
INDEPENDENT ADVICE FROM INDEPENDENT LEGAL, ACCOUNTING AND TAX PROFESSIONAL
ADVISORS AS THE SUBSCRIBER HAS DETERMINED NECESSARY TO MAKE A DECISION TO
PURCHASE THE SPECIAL WARRANTS.
10. REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company agrees that the Subscriber shall have the benefit of each
and all of the representations and warranties made by the Company to the Agent
in the Agency Agreement, with the same effect as if such representations and
warranties were repeated herein and made to the Subscriber, and acknowledges
that the Subscriber is relying upon such representations and warranties in
entering into this Agreement. The Company will, upon request of the Subscriber
and without charge, provide the Subscriber with an extract from the Agency
Agreement setting forth all such representations and warranties.
50
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11. CONTRACTUAL RIGHT OF ACTION FOR RESCISSION
In the event that a holder of Special Warrants, who acquires Shares upon
the exercise of the Special Warrants, is or becomes entitled to the remedy of
rescission by reason of the Prospectus, the Registration Statement or any
amendment thereto containing a misrepresentation, such holder shall, subject to
available defences and any limitation period under applicable securities
legislation, be entitled to rescission not only of the holder's exercise of its
Special Warrants but also of this Agreement pursuant to which the Special
Warrants were initially acquired, and shall be entitled in connection with such
rescission to a full refund from the Company of all consideration paid on the
acquisition of the Special Warrants. In the event such holder is a permitted
assignee of the interest of the original Special Warrant subscriber, such
permitted assignee shall be entitled to exercise the rights of rescission and
refund granted hereunder as if such permitted assignee were such original
subscriber. The foregoing is in addition to any other right or remedy available
to a holder of Special Warrants under applicable securities legislation.
12. APPOINTMENT OF AGENT
The Subscriber, on its own behalf and on behalf of others for whom it is
contracting hereunder, hereby:
(a) irrevocably authorizes the Agent to negotiate and settle the
form of the Special Warrant Indenture and any other agreement to
be entered into in connection with this transaction and to waive
on its own behalf and on behalf of the Subscribers in whole or
in part, or extend the time for compliance with, any of the
Closing conditions in such manner and on such terms and
conditions as the Agent may determine, acting reasonably,
without in any way affecting the Subscriber's obligations or the
obligations of such others hereunder;
(b) acknowledges and agrees that the Agent and the Company may vary,
amend, alter or waive, in whole or in part, one or more of the
conditions set forth in the Agency Agreement in such manner and
on such terms and conditions as they may determine, acting
reasonably, without affecting in any way the Subscriber or such
others' obligations hereunder; provided however, that the Agent
shall not vary, amend, alter or waive any such condition where
to do so would result in a material change to any of the
material attributes of the Special Warrants described herein;
and
(c) irrevocably authorizes the Agent to swear, execute, file and
record any documents necessary to accept delivery of the Special
Warrants at the Closing and to terminate this Agreement on
behalf of the Subscriber in the event that any condition
precedent to the offering has not been satisfied.
Should the Offering be over subscribed, the number of Special Warrants
subscribed for shall be allocated to the Subscriber in the discretion of the
Company. The Agent shall be authorized to amend the information contained herein
to reduce the number of Special Warrants subscribed for and the Subscription
Price to reflect the number of Special Warrants allocated to the Subscriber and
the Subscription Price therefor.
51
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13. TERMINATION OF AGREEMENT
The Subscriber may terminate his or her subscription hereunder if the
Agent terminates its obligations under the Agency Agreement, and hereby
irrevocably constitutes the Agent as his or her attorney for purposes of
notifying the Company of such termination.
14. COMMISSION TO THE AGENT
The Subscriber acknowledges and agrees that the gross proceeds derived
from the sale of the Special Warrants less the Cash Commission (as defined
below) shall be paid to the Company on the Closing. The Subscriber understands
that upon completion of the Offering, the Agent will receive from the Company a
cash commission (the "Cash Commission") equal to 8% of the Subscription Price of
the Special Warrants to be sold under this offering to Subscribers. Agent's
special warrants (the "Agent's Option") exercisable to acquire Agent's warrants
to purchase that number of Shares equal to 10% of the Shares issuable upon the
exercise of Special Warrants will be issued to the Agent or according to the
Agent's direction. No other fee or commission is payable by the Company in
connection with the sale of the Special Warrants. However, the Company will pay
those fees and expenses in connection with the offering as are set out in the
Agency Agreement. The Agent and its directors, officers, employees and
affiliates may, from time to time, hold positions in securities of the Company.
Both the Company and the Subscriber acknowledge that the Agent is acting
as agent in this transaction and the Subscriber hereby acknowledges that all
warranties, conditions, representations or stipulations, whether express or
implied and whether arising hereunder or under prior agreement or statement or
by statute or at common law are expressly those of the Company, other that those
relating solely to the Agent. The Subscriber acknowledges that its decision to
execute this Agreement and purchase the Special Warrants has not been based upon
any information or representation concerning the Company provided to the
Subscriber by the Company or the Agent other than those contained in this
Agreement and such as are contained in documents the Company has filed with
securities regulators and which are publicly available (the "Disclosure
Record"), and that the Subscriber is relying entirely upon this Agreement and
the Disclosure Record. Any information given or statement made is given or made
without liability or responsibility howsoever arising on the part of the Agent.
No person in the employment of, or acting as agent of, the Agent has any
authority to make or give any representation or warranty and the Company and the
Subscriber hereby release the Agent from any claims that may arise in respect
thereof.
15. COSTS
The Subscriber acknowledges and agrees that all costs and expenses
incurred by the Subscriber (including any fees and disbursements of any special
counsel retained by the Subscriber) relating to the purchase of the Special
Warrants shall be borne by the Subscriber, other than the Cash Commission and
Agent's Option which shall be borne by the Company as set out above.
16. GOVERNING LAW
This Agreement is governed by the laws of the Province of British
Columbia and the federal laws of Canada applicable therein. The Subscriber, in
his or her personal or corporate capacity and, if applicable, on behalf of each
beneficial purchaser for whom he is acting, irrevocably attorns to the
jurisdiction of the courts of the Province of British Columbia.
52
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17. SURVIVAL
This Agreement, including without limitation the representations,
warranties and covenants contained herein, shall survive and continue in full
force and effect and be binding upon the Subscriber notwithstanding the
completion of the purchase of the Special Warrants by the Subscriber pursuant
hereto, the completion of the issue of Special Warrants and the Shares and any
subsequent disposition by the Subscriber of the Special Warrants or Shares.
18. ASSIGNMENT
This Agreement is not transferable or assignable.
19. TIME IS OF THE ESSENCE
For the purposes of this Agreement, time is of the essence.
20. COUNTERPARTS
This Agreement may be executed in as many counterparts as may be
necessary and by facsimile, each of such counterparts so executed will be deemed
to be an original and such counterparts together will constitute one and the
same instrument and notwithstanding the date of execution will be deemed to bear
the date as of the day and year first above written.
53
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EXHIBIT A
Form P1
THE TORONTO STOCK EXCHANGE
PRIVATE PLACEMENT QUESTIONNAIRE AND UNDERTAKING
To be completed by each proposed private placement purchaser of listed
securities or securities which are convertible into listed securities.
QUESTIONNAIRE
1. DESCRIPTION OF TRANSACTION
(a) Name of issuer of the securities: Genetronics Biomedical Ltd.
-------------------------------
(b) Number and class of securities to be purchased: Special Warrants
-----------------
(c) Purchase Price: US$3.00 per Special Warrant
-------------------------------------------------
2. DETAILS OF PURCHASER
(a) Name of purchaser: Capital Research Management Company
----------------------------------------------
(b) Address:
--------------------------------------------------------
(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 qualifies as an
insider:
No
-----------------------------------------------------------------
(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:
No
-----------------------------------------------------------------
54
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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:
None
------------------------------------------------------------------------
------------------------------------------------------------------------
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 closing of the transaction herein or until a receipt is
issued by the British Columbia Securities Commission for a Prospectus qualifying
the issue of Shares on exercise of the Special Warrants, without the prior
consent of The Toronto Stock Exchange and any other regulatory body having
jurisdiction.
Dated at London, England Capital Research Management Company
------------------------------------ ------------------------------------
on May 28, 1999 (Name of Purchaser-please print)
------------------------------------
(Authorized Signature)
------------------------------------
(Official Capacity-please print)
------------------------------------
(Please print here name of
individual whose signature appears
above, if different from name of
purchaser printed above)
55
EXHIBIT B
REGULATION D
INVESTOR QUALIFICATION QUESTIONNAIRE (ENTITY)
In connection with the undersigned's proposed purchase of certain
special warrants and the potential conversion thereof resulting in the issuance
of shares of Common Stock (collectively, the "Securities") of Genetronics
Biomedical Ltd. (the "Company"), the undersigned makes the following
representations on which you are entitled to rely:
1. The undersigned's full name, primary business address, phone
number and federal tax I.D. numbers are:
Capital Research Management Company
----------------------------------------------------------------
----------------------------------------------------------------
----------------------------------------------------------------
Telephone:
----------------------------------------------------------------
Federal Tax I.D. #
----------------------------------------------------------------
2. The profits and net assets of the entity are such that it is not
now, and does not contemplate that it will be, required to
dispose of its Securities to satisfy any existing or expected
undertaking or indebtedness. It is also able to bear the
economic risk of an investment in the Company as well as the
restriction on its ability to sell or transfer the Securities
for an indefinite period of time because it will not be
registered under the Securities Act of 1933, as amended (the
"Act") or any applicable state securities laws, and therefore
cannot be sold, transferred, pledged or otherwise disposed of or
encumbered unless it is subsequently registered pursuant to the
Act or an exemption from such registration is available.
3. The undersigned makes one of the following representations
regarding its net worth and certain related matters and has
checked the applicable representation:
(a) [ ] The undersigned certifies that it is either (a) a
bank as defined in section 3(a)(2) of the Act, (b) a
savings and loan association or other institution
specified in section 3(a)(5)(A) of the Act, (c) an
insurance company as defined in section 2(13) of the
Act, (d) an investment company registered under the
Investment Company Act of 1940, (e) a business
development company as defined in section 2(a)(48) of
such Act, (f) a Small Business Investment Company
licensed by the U.S. Small Business Administration under
section 301(c) or (d) of the Small Business Investment
Act of 1958, (g) any plan established and maintained by
a state, its political subdivisions or any agency or
instrumentality of a state or its political subdivisions
for the benefit of its employees, if such plan has total
assets in
56
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excess of $5,000,000, (h) an employee benefit plan
within the meaning of Title I of the Employee Retirement
Income Security Act of 1974, if the investment decision
is made by a plan fiduciary, as defined in section 3(21)
of such Act, and the plan fiduciary is either a bank,
insurance company, or registered investment adviser, or
savings and loan association or if the employee benefit
plan has total assets in excess of $5,000,000, or if the
employee benefit plan is a self-directed plan, with
investment decisions made solely by an accredited
investor, (i) an organization described in Section
501(c)(3) of the Internal Revenue Code with total assets
in excess of $5,000,000, (j) a broker or dealer
registered pursuant to section 15 of the Securities
Exchange Act of 1934, (k) a corporation or partnership
with total assets in excess of $5,000,000, or (l) a
trust with total assets in excess of $5,000,000 whose
purchase is directed by a sophisticated person.
(b) [ ] The undersigned certifies that it is a private
business development company as defined in section
202(a)(22) of the Investment Advisers Act of 1940.
(c) [ ] The undersigned certifies that it is an entity that
(i) was not organized in the United States, (ii) does
not conduct any business in the United States and (iii)
was not formed for the specific purpose of acquiring the
Securities.
(d) [ ] The undersigned certifies that each and every one of
its equity owners (in the case of a revocable living
trust, its grantor(s)) is able to certify that he meets
at least one of the following three conditions:
(i) The equity owner is a natural person whose
individual net worth, or joint worth with his
spouse (i.e., total assets in excess of total
liabilities) exceeds $1,000,000.
(ii) The equity owner is a natural person who had an
INDIVIDUAL annual adjusted gross income(1) in
excess of $200,000 (or an annual adjusted gross
income with such owner's spouse in excess of
$300,000) in each of the two most recent tax
years and who reasonably expects an individual
annual adjusted gross income in excess of
$200,000 (or an annual adjusted gross income
with such owner's spouse in excess of $300,000)
in his current tax year.
(iii) The equity owner is one of the institutions or
entities set forth in paragraph 7.1 above.
--------
(1) As used herein "individual annual adjusted gross income" means "adjusted
gross income," as reported for Federal income purposes, less any income
attributable to a spouse or to property owned by a spouse and increased by the
following amounts (but not including any amounts attributable to a spouse: (i)
the amount of any tax-exempt interest income received, (ii) amount of losses
claimed as a limited partner in a limited partnership, (iii) any deduction
claimed for depletion, (iv) amounts contributed to an XXX, Xxxxx or 401(k)
retirement plan and (v) alimony paid.
57
3
4. The undersigned represents that the information contained herein
is complete and accurate and may be relied upon by the Company,
and that the undersigned will notify the Company of any material
change in any of such information prior to the undersigned's
investment in the Company.
IN WITNESS WHEREOF, the undersigned has executed this certificate on May
28, 1999
Capital Research Management Company
------------------------------------
NAME OF ENTITY
By:
---------------------------------
------------------------------------
Title or Association with Entity
58
EXHIBIT C
CERTIFICATION BY FOREIGN PORTFOLIO MANAGER
The undersigned is purchasing securities of Genetronics Biomedical Ltd. (the
"Issuer").
The undersigned hereby certifies that:
(a) it is purchasing securities of the Issuer on behalf of managed accounts
over which it has absolute discretion as to purchasing and selling, and
in respect of which it receives no instructions from any person
beneficially interested in such accounts or from any other person;
(b) it carries on the business of managing the investment portfolios of
clients through discretionary authority granted by those clients (a
"portfolio manager" business) in ___________ [jurisdiction], and it is
permitted by law to carry on a portfolio manager business in that
jurisdiction;
(c) it was not created solely or primarily for the purpose of purchasing
securities of the Issuer;
(d) the total asset value of the investment portfolios it manages on behalf
of clients is not less than $20,000,000;
(e) it does not believe, and has no reasonable grounds to believe, that any
resident of British Columbia has a beneficial interest in any of the
managed accounts for which it is purchasing; and
(f) the Issuer has provided it with a list of the directors, senior officers
and other insiders of the Issuer, and the persons that carry on investor
relations activities for the Issuer (which list is attached as a
schedule to this Form), and it does not believe, and has no reasonable
grounds to believe, that any of those persons has a beneficial interest
in any of the managed accounts for which it is purchasing, except as
follows:
__________________________________________ (name of insider(s) or
person(s) carrying on investor relations activities for the Issuer that
have a beneficial interest in an account.)
The undersigned acknowledges that it is bound by the provisions of the British
Columbia Securities Act including, without limitation, sections 87 and 111
concerning the filing of insider reports and reports of acquisitions.
Dated at ___________________________________ this _____ day of _________, 1999.
------------------------------------
(Name of Purchaser - please print)
------------------------------------
(Authorized Signature)
------------------------------------
(Official Capacity - please print)
------------------------------------
(please print name of individual
whose signature appears above, if
different from name of purchaser
printed above)
59
SCHEDULE TO EXHIBIT C - CERTIFICATION BY FOREIGN PORTFOLIO MANAGER
LIST OF DIRECTORS, SENIOR OFFICERS AND OTHER INSIDERS
OF THE COMPANY AND OTHER PERSONS THAT CARRY ON
INVESTOR RELATIONS ACTIVITIES FOR THE COMPANY
Xxxx X. Xxxxxxxx
Xxxxxx Xxxxxxx
Xxxxxx Xxxx
Xxxxx X. Xxxxxxx
Xxxxxxx Xxxx
Xxxx Xxxxxxx
Xxxxxx X. Politeski
Xxxxx Xxxxxxx
Xxxxx Xxxxxxx
Xx Xxxxxx
Xxxxxxx Xxxxxxxx
Xxxxxxx XxXxxxx
Xxxxxx Xxxxxxx
E. Xxxxxx Xxx-Xxxxxxx
Xxxxxx Xxxxxxxx
Xxxxxx DeKertanguy
Miles Lewis
Xxxxxxx XxXxxxx
Xxxxx Xx Xxxx
Xxxx Xxxxxx
