To: STOCKGROUP INFORMATION SYSTEMS INC. (hereafter called the "Company" or
"Issuer"), a Colorado company, with an address for notice and delivery at
#500 - 750 W. Pender St., Vancouver, British Columbia, V6C 2T7
The Company is offering, on a private placement basis, units (the "Units"),
whereby each Unit consists of one common share (the "Share" or "Shares" or also
the "Securities") and one non-transferable share purchase warrant (the "Warrant"
or "Warrants" as the context requires) of its own issue, to eligible investors
(such an investor who subscribes to this issue by this document is hereafter
called the "Subscriber") at a price of $0.20 US per Unit. Each Warrant will
entitle the holder thereof to acquire one Share of the Company at a purchase
price of $0.25 US per Share for a period of twelve (12) months from the date of
issue. The Company offers, and the Subscriber accepts, the Units on the terms
and conditions hereafter set forth.
With each Unit subscribed, the Subscriber shall receive one Share and shall
also receive a Warrant having the following characteristics:
(a) each Warrant permits the purchase of another Share at a price of $0.25 US
until March 25, 2003;
(b) the Warrants shall be altered for each alteration of capital of the
Company, or its successor, as to number and price in accordance with
industry practice; and
(c) the Warrants are non-transferable and the Warrant and any resultant shares
are subject to such restrictions as law requires.
Based upon the hereafter terms, conditions, representations, warranties,
and covenants given by each party to the other, the Subscriber hereto hereby
irrevocably subscribes for and agrees to purchase ____________ Units of the
Company for an aggregate consideration of $___________ US (the "Subscription
Price"). The Company, upon acceptance by the board of all or part of this
subscription, agrees to issue the accepted number of Securities, fully paid and
non-assessable, as consideration for the Subscriber's subscription, and to
refund any excess subscription monies of the Subscription Price of any
non-accepted portion.
If the Subscriber is not a US accredited investor or is not a non-US
sophisticated investor, purchasing an exempt investment under the laws of his
jurisdiction, then the Subscriber warrants and acknowledges that the Subscriber
is purchasing the Securities on a private basis and the Subscriber represents
that the Subscriber has a relationship with the Company and is not a member of
the public by virtue of being one or more of the following, a friend, relative,
or business associate of ________________________________________________(one of
either a director, officer, or promoter of the issuer) or the Subscriber, at the
time of the Subscriber's investment herein, is a director ( ), officer ( ), or
employee ( ) of the Company or a subsidiary [please check the appropriate
category].
The Subscriber, if the Subscriber does not have the forgoing relationship with
the Company, warrants that the Subscriber is an eligible or exempt investor
under the Subscriber's domicile laws by virtue of the subscriber's wealth and/or
subscribing for a value in Securities constituting an exempt investment under
the laws of the Subscriber's domicile, and/or is subscribing pursuant to a
qualifying offering memorandum and the terms thereof, and/or is
otherwise an eligible investor under the laws of the Subscriber's domicile by
virtue of his wealth, income, and investment knowledge and capacity and/or the
Subscriber's domicile has no restrictions on its citizen's right to invest. If
this paragraph applies to the Subscriber and the Subscriber is not a US citizen
and therefor has not answered the accredited investor disclosure below for US
subscribers, then the Subscriber advises the Company that he is exempt by one or
more of the following (check appropriate category):
( ) the Subscriber's domicile laws do not restrict citizen's investment;
( ) the Subscriber is subscribing for an amount which constitutes an
exempt purchase amount in the Subscriber's jurisdiction (the minimum
amount of which is $97,000 - Section 74(2)(4) of the Securities Act
(British Columbia)); --
( ) the Subscriber is exempt from registration in his jurisdiction due to
his wealth (the minimum amount of which is $ __________________);
( ) the Subscriber is exempt due to a further exemption which is described
as:
Section 128(a) of the Securities Rules (British Columbia) ;
Section 128(b) of the Securities Rules (British Columbia) ; or
Section 128(c) of the Securities Rules (British Columbia).
The Subscriber understands and acknowledges that the Company is a reporting and
publicly trading company listed on the NASD Over-the-Counter Bulletin Board and
the Subscriber acknowledges that no party independent of the Company has made or
will make any opinion or representations on the merits or risks of an investment
in Securities. The Subscriber acknowledges hereby being advised and is
encouraged to seek independent investment advice.
The Subscriber warrants that the Subscriber has truthfully and fully disclosed
the Subscriber's information in this subscription and has read and concurs in
all the statements of this subscription, upon which the Company relies (to its
possible damage if the Subscriber declares falsely), has disclosed the
Subscriber's proper jurisdiction and has declared whether the Subscriber is or
is not, directly or indirectly, a US subject and has considered carefully and
answered truthfully (and has sought appropriate counsel and advice) as to the
exemptions which apply to the Company and of the economic reasonableness of an
investment by the Subscriber in the Company in the circumstances of the
Subscriber.
UNITED STATES INVESTOR DECLARATION - FOR US INVESTORS ONLY
The Subscriber warrants and certifies that if the Subscriber is a US
citizen (or otherwise subject to US jurisdiction) that the Subscriber has so
declared such herein and the Subscriber is an "Accredited Investor" as that term
is defined in Regulation D promulgated under the relevant Securities Act (the
"Act") of the United States, by virtue of the Subscriber's qualification under
one or more of the following categories [please check the appropriate space or
spaces]:
______ The Subscriber is a natural person whose individual net worth, or
joint net worth with that person's spouse exceeds $1,000,000, not including the
Subscriber's principal residence.
______ The Subscriber is a natural person who had an individual income in
excess of $200,000 in each of the two most recent years or joint income with
that person's spouse in excess of $300,000 in each of those years and has a
reasonable expectation of reaching the same income level in the current year.
______ The Subscriber is a corporation, organization described in section
501(c)(3) of the United States Internal Revenue Code, Massachusetts or similar
business trust, or partnership, not formed for the specific purpose of acquiring
the Securities, with total assets in excess of $5,000,000.
______ The Subscriber is a trust, with total assets in excess of
$5,000,000, not formed for the specific purpose of acquiring the Securities,
whose purchase is directed by a sophisticated person.
______ The Subscriber is a director or executive officer of the
Corporation.
______ The Subscriber is a private business development company as defined
in section 202(a)(22) of the Investment Advisers Act of 1940.
______ The Subscriber is a bank as defined in section 3(a)(2) of the Act,
or a savings and loan association or other institution as defined in section
3(a)(5)(A) of the Act whether acting in its individual or fiduciary capacity; a
broker or dealer registered pursuant to section 15 of the Securities Exchange
Act of 1934; an insurance company as defined in section 2(13) of the Act; an
investment company registered under the Investment Company Act of 1940 or a
business development company as defined in section 2(a)(48) of that Act; 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; a 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 excess of $5,000,000; an
employee benefit plan within the meaning 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, which is either a bank, savings and loan
association, insurance company, or registered investment adviser, or if the
employee benefit plan has total assets in excess of $5,000,000 or, if a self-
directed plan, with investment decisions made solely by persons that are
accredited investors.
______ The Subscriber is an entity in which all of the equity owners are
accredited investors under one or more of the categories set forth above.
NON-US INVESTOR DECLARATION AND REGULATION S APPLICATION
If The Subscriber has not completed the forgoing section for US investors, the
Subscriber warrants that such means without equivocation that the Subscriber is
not a US investor, directly or indirectly, and the Subscriber is not subscribing
as an agent or nominee or trustee or in any other capacity, partly or wholly or
directly or indirectly, for a US person subject to US law.
The Subscriber represents and warrants that the Subscriber was not
specifically formed to acquire any of the Securities subscribed for in
this Agreement in violation of the provisions of Regulation S or Rule
144.
As the Company is or may be or may develop to become a US company or a
company whose securities are subject to US law, the Subscriber hereby
agrees, represents and warrants to the Company as follows:
(i) Subscriber (i) is not a U.S. Person (as defined in Rule 902 of
Regulation S ("Regulation S") under the United States Securities Act of 1933
(the "1933 Act")), which definition includes, but is not limited to, any natural
person resident in the United States, any corporation or partnership
incorporated or organized under the laws of the United States, or any estate or
trust of which any executor, administrator or trustee is a U.S. Person); (ii) is
not purchasing any of the Securities for the account or benefit of any U.S.
Person or for offering, resale or delivery for the account or benefit of any
U.S. Person or for the account of any person in any jurisdiction other than the
jurisdiction set out in the name and address of Subscriber below; and (iii) was
not offered any Securities in the United States and was outside the United
States at the time of execution and delivery of this Subscription Agreement.
(ii) Subscriber acknowledges that the Securities have not been registered
under the 1933 Act and the Company has agreed to register the securities
purchased under this offering with the Securities and Exchange Commission by
filing a registration statement under the 1933 Act within 60 days of the closing
of this offering. The Subscriber agrees to resell the Securities only in
accordance with the provisions of Regulation S and any other applicable
securities laws, pursuant to a registration under the 1933 Act, or pursuant to
an available exemption from such registration, and that hedging transactions
involving the Securities may not be conducted unless in compliance with the 1933
Act. The Subscriber understands that any certificate representing the Securities
will bear a legend setting forth the foregoing restrictions. The Subscriber
understands that the Securities are restricted securities within the meaning of
Rule 144 promulgated under the 1933 Act; that the exemption from registration
under Rule 144 will not be available in any event for at least one year from the
date of purchase and payment of the Securities by the Subscriber, and other
terms and conditions of Rule 144 are complied with; and that any sale of the
Securities may be made by the Investor only in limited amounts in accordance
with such terms and conditions. In addition, any Subscriber who is a British
Columbia resident will be subject to British Columbia resale restrictions which
will be set out in the legend stamped on the certificate representing the
Securities.
(iii) No U.S. Person, either directly or indirectly, has any beneficial
interest in any of the Securities acquired by Subscriber hereunder, nor does
Subscriber have any agreement or understanding (written or oral) with any U.S.
Person respecting:
(a) the transfer or any assignment of any rights or interest in any
of the Securities;
(b) the division of profits, losses, fees, commissions or any
financial stake in connection with this subscription; or
(c) the voting of the Securities.
(iv) the Subscriber understands that each person exercising any Warrant
comprising a part of the Securities will be required to give to the Company at
the time of exercise written certification that such person is not a U.S. person
and that the Warrant is not being exercised on behalf of a U.S. person.
RESTRICTED SECURITIES AND DISPOSITION UNDER RULE 144/REG. S
(This applies to all Subscribers)
Whether the Subscriber has purchased subject to Rule 144 or Reg. S, if the
Company is or becomes subject to US law, the Subscriber represents and warrants
that the Subscriber understands that:
(a) neither the sale of the Securities which the Subscriber is
acquiring nor the Securities themselves has been registered under the Act or any
state securities laws, and the Securities must be held indefinitely unless
subsequently registered under the Act or an exemption from such registration is
available; and
(b) the share certificate representing the Securities will be stamped
with the following legends (or substantially equivalent language) restricting
transfer:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933 OR THE LAWS OF ANY STATE AND HAVE BEEN
ISSUED PURSUANT TO AN EXEMPTION FROM REGISTRATION PERTAINING TO SUCH
SECURITIES AND PURSUANT TO A REPRESENTATION BY THE SECURITY HOLDER NAMED
HEREON THAT SAID SECURITIES HAVE BEEN ACQUIRED FOR PURPOSES OF INVESTMENT
AND NOT FOR PURPOSES OF DISTRIBUTION. THESE SECURITIES MAY NOT BE OFFERED,
SOLD, TRANSFERRED, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF REGISTRATION,
OR THE AVAILABILITY OF AN EXEMPTION FROM SUCH REGISTRATION. FURTHERMORE, NO
OFFER, SALE, TRANSFER, PLEDGE OR HYPOTHECATION IS TO TAKE PLACE WITHOUT THE
PRIOR WRITTEN APPROVAL OF COUNSEL TO THE ISSUER BEING AFFIXED TO THIS
CERTIFICATE. THE STOCK TRANSFER AGENT HAS BEEN ORDERED TO EFFECTUATE
TRANSFERS OF THIS CERTIFICATE ONLY IN ACCORDANCE WITH THE ABOVE
INSTRUCTIONS."
"Unless permitted under securities legislation in British Columbia, the
holder of the securities shall not trade the securities before the earlier
of (i) the date that is 12 months and a day after the date the issuer first
became a reporting issuer in any of Alberta, British Columbia, Manitoba,
Nova Scotia, Ontario, Quebec and Saskatchewan, if the issuer is a SEDAR
filer; and (ii) the date that is 12 months and a day after the later of (A)
the distribution date, and (B) the date the issuer became a reporting
issuer in the local jurisdiction of the purchaser of the securities that
are the subject of the trade."
The Subscriber represents and warrants that the Subscriber understands that
the Securities are restricted securities within the meaning of Rule 144/Reg. S
promulgated under the Act; that the exemption from registration under Rule
144/Reg. S will not be available in any event for at least one year from the
date of purchase and payment of the Securities by the Subscriber, and other
terms and conditions of Rule 144/Reg. S are complied with; and that any sale of
the Securities may be made by the Subscriber only in limited amounts in
accordance with such terms and conditions.
Without in any way limiting the representations set forth above, the
Subscriber further agrees that the Subscriber shall in no event make any
disposition of all or any portion of the Securities which the Subscriber is
acquiring unless and until:
(a) there is then in effect a Registration Statement under the Act
covering such proposed disposition and such disposition is made in accordance
with said Registration Statement; or
(b) (i) the Subscriber shall have notified the Corporation of the
proposed disposition and shall have furnished the Corporation with a detailed
statement of the circumstances surrounding the proposed disposition, (ii) the
Subscriber shall have furnished the Corporation with an opinion of the
Subscriber's own counsel to the effect that such disposition will not require
registration of such Securities under the Act or any other applicable securities
legislation, and (iii) such opinion of the Subscriber's counsel shall have been
concurred in by counsel for the Corporation and the Corporation shall have
advised the Subscriber of such concurrence.
METHOD OF SUBSCRIPTION
A subscription shall be made by delivering to the Company or its agent a signed
and fully completed copy of this subscription agreement and the Subscription
Price made to the order of the Company.
The Company shall return to the Subscriber the Subscription Price, or such
amount as has not been accepted, as to such part of the subscription which the
Company has not accepted.
INVESTMENT SUBSCRIPTION TERMS, CORPORATE DISCLOSURE AND GENERAL INVESTOR
ACKNOWLEDGMENTS AND WARRANTIES
1. Description of the Securities. The Securities are a part of the common
shares of the Company. The Company's authorized capital consists of 75,000,000
common shares without par value, of which 10,108,058 shares were issued and
outstanding as of December 20, 2001, and 5,000,000 preferred shares without par
value, of which no shares were issued and outstanding as of December 20, 2001.
Copies of the constating documents of the Company describing the common
securities and the rights of holders and other corporate materials of the
Company are available upon request.
2. Use of Funds of the Securities. The Subscriber acknowledges that the funds
to be raised from the Securities are to be employed for the business of the
Company in accordance with management's discretion as to the best use of the
same for the Company's business plans. The Company reserves the right at any
time to alter its business plans in accordance with management's appreciation of
the market for the goods and services of the Company.
3. Securities Issued at Different Prices and Characteristics. The Subscriber
acknowledges that the Company will issue its securities at different prices
which may occur sequentially, from time-to-time, or at the same time. The
Company will also issue offerings which have warrants, or other benefits,
attached and some offerings which do not. Not all subscribers will receive
common shares, or other share classes, of the Company at the same price and such
may be issued at vastly different prices to that of the Subscriber. For example,
the Company has or will issue Securities frequently referred to as `founders
shares', in a number of possibly several millions and at nominal price, or it
may issue securities at nominal prices for developmental assets (which cannot be
valued and so may be assigned a nominal value on the Company's books), or other
circumstances considered advisable by the board of directors. Such issuance at
different prices are made by the board in its judgement as to typical
structuring for a company such as the Company, to incentivise, reward, and to
provide a measure of developmental control to the founders, to acquire assets or
services which the board considers necessary or advisable for the Company's
development and success, and other such considerations in the board's judgement.
The Subscriber acknowledges these matters, understands that the Subscriber's
investment is not necessarily the most advantageous investment in the Company,
and authorizes the Board now and hereafter to use its judgement to make such
issuances whether such issuances are at a lesser, equal or greater price than
the Subscriber and whether such is prior to, concurrent with, or subsequent to
the Subscriber's investment. The Subscriber acknowledges that the Subscriber has
had disclosed to the Subscriber that the Company has issued securities at
different prices and with different characteristics, the Subscriber has had the
opportunity for full disclosure and questions in respect thereto, and the
Subscriber accepts without equivocation the securities structure and pricing of
the Company by subscription hereto.
4. Subscriber's Acknowledgments. The Subscriber agrees and acknowledges that:
(a) Withdrawal or Revocation. This Subscription Agreement is given for
valuable consideration and shall not be withdrawn or revoked by the
Subscriber once tendered to the Solicitors with the Subscription
Price;
(b) Agreement to be Bound. The Subscriber hereby specifically agrees to be
bound by the terms of this Subscription Agreement as to all
particulars hereof and hereby reaffirms the acknowledgments,
representations, and powers set forth in this Subscription Agreement;
(c) Reliance on Subscriber's Representations. The Subscriber understands
that the Company will rely on the acknowledgments, representations,
and covenants of the Subscriber herein in determining whether a sale
of the Securities to the Subscriber is in compliance with applicable
securities laws. The Subscriber warrants that all acknowledgments,
representations and covenants are true and accurate;
(d) Waiver of Preemptive Rights. The Subscriber hereby grants, conveys,
and vests the President of the Company as the Subscriber's power of
attorney solely for the purpose of waiving any prior or preemptive
rights which the Subscriber may have to further issues of equity by
the Company.
5. Subscriber's Representations, Warranties, and Understandings. The
Subscriber represents and warrants to the Company and states that:
(a) Principal. The Subscriber is purchasing the Securities as principal
for his own account and not for the benefit of any other person except
as otherwise stated herein, and not with a view to the resale or
distribution of all or any of the Securities;
(b) Decision to Purchase. The decision of the Subscriber to enter into
this agreement and to purchase Securities pursuant hereto has been
based only on the representations of this agreement and any collateral
business plan or offering memorandum provided herewith or based upon
the Subscriber's relationship with the foregoing stated person of the
Company. It is not made on other information relating to the Company
and not upon any oral representation as to fact or otherwise made by
or on behalf of the Company or any other person. The Subscriber agrees
that the Company assumes no responsibility or liability of any nature
whatsoever for the accuracy, adequacy or completeness of any business
plan information, which has been created based upon the Company's
management experience. In particular, and without limiting the
generality of the foregoing, the decision to subscribe for Securities
has not been influenced by:
(i) Newspaper, magazine or other media articles or reports related to
the Company or its business; or
(ii) Promotional literature or other materials used by the Company for
sales or marketing purposes; or
(iii) Any representations, oral or otherwise, that the Securities will
be repurchased or have any guaranteed future realizable value, or
that there is any certainty as to the success of the Company or
liquidity or value of the Securities.
(c) Economic Risk. The Subscriber has such knowledge and experience in
financial and business affairs as to be capable of evaluating the
merits and risks of his investment in the Securities, or has sought
and received independent professional advice, and the Subscriber is
able to bear the economic risk of a total loss of the Subscriber's
investment in the Securities;
(d) Speculative Investment. The Subscriber understands that an investment
in the Securities is a speculative investment and that there is no
guarantee of success of Management's plans. Management's plans are an
effort to apply present knowledge and experience to project a future
course of action which is hoped will result in financial success
employing the Company's assets and with the present level of
management's skills and of those whom the Company will need to attract
(which cannot be assured). Additionally, all plans are capable of
being frustrated by new or
unrecognized or unappreciated present or future circumstances which
can typically not be accurately, or at all, predicted.
(e) Status. If the Subscriber has stated that he is not a U.S. person, as
defined under the United States Securities Act of 1933, as amended
(the "U.S. Act"), then he declares unequivocally that he is not a US
person and was not offered the Securities in the United States (as
that term is defined in the U.S. Act), and did not execute or deliver
this Agreement in the United States. If the Subscriber is a US person
then such has been declared in this document by noting the Subscriber
as having a US address below, completing the declarations at the
commencement of this document (all of which are truly stated), and the
Subscriber qualifies as an eligible investor (by virtue of having the
requisite personal wealth and income and/or qualifying under other
appropriate exemption) under the relevant securities laws;
(f) Address. The Subscriber is resident as set out on the last page of
this Agreement as the "Subscriber's Address" and the address set forth
on the last page of this Agreement is the true and correct address of
the Subscriber;
(g) Risk and Resale Restriction. The Subscriber is aware of the risks and
other characteristics of the Securities and of the fact that the
Subscriber will not be able to resell the Securities except in
accordance with the applicable securities legislation and regulatory
policy;
(h) Receipt of Information. The Subscriber acknowledges that, to his
satisfaction:
(i) He has either had access to or has been furnished with sufficient
information regarding the Company and the terms of this
investment transaction to his satisfaction;
(ii) He has been provided the opportunity to ask questions concerning
this investment transaction and the terms and conditions thereof
and all such questions have been answered to his satisfaction;
and
(iii) He has been given ready access to and an opportunity to review
any information, oral or written, that he has requested, in
particular to any offering memorandum or business plan of the
Company, if available concurrent with or as a part of this
subscription;
(i) No Prospectus filing. The Subscriber acknowledges that this is an
offering made on a private basis without a prospectus and that no
federal, state, provincial or other agency has made any finding or
determination as to the merits of the investment nor made any
recommendation or endorsement of the Securities, and that:
(i) The Subscriber may be or is restricted from using most of the
civil remedies available under the applicable securities act; and
(ii) The Company is relieved from certain obligations that would
otherwise apply under the applicable securities act;
(j) Confidentiality. The Subscriber understands that the Company's
business plan and this Agreement are confidential. The Subscriber will
not and has not distributed such, or divulged the contents thereof, to
anyone other than such legal or financial advisors as the Subscriber
has deemed desirable for purposes of evaluating an investment in the
Securities and the Subscriber has not made any copies thereof except
for his own records;
(k) Age of Majority. The Subscriber, if an individual, has attained the
age of majority and is legally competent to execute this Agreement and
to take all actions required pursuant hereto;
(l) Authorization and Formation of Subscriber. The Subscriber, if a
corporation, partnership, trust or other form of business entity, is
authorized and otherwise duly qualified to purchase and hold the
Securities and such entity has not been formed for the specific
purpose of acquiring Securities in the Offering. If the Subscriber is
one of the aforementioned entities, it hereby agrees that upon request
of the Company it will supply the Company with any additional written
information that may be requested by the Company;
(m) Legal Obligation. This Agreement has been duly and validly authorized,
executed and delivered by and constitutes a legal, valid, binding and
enforceable obligation of the Subscriber;
(n) Compliance With Applicable Laws. The Subscriber knows of no reason
(and is sufficiently knowledgeable to determine the same or has sought
legal advice) why the delivery of this Agreement, the acceptance of it
by the Company and the issuance of the Securities to the Subscriber
will not comply with all applicable laws of the Subscriber's
jurisdiction of residence or domicile, and all other laws applicable
to the Subscriber, and the Subscriber has no reason to believe that
the Subscriber's subscription hereby will cause the Company to become
subject to or required to comply with any disclosure, prospectus or
reporting requirements or to be subject to any civil or regulatory
review or proceeding. The Subscriber will comply with all applicable
securities laws and will assist the Company in all reasonable manner
to comply with all applicable securities laws; and
(o) Encumbrance or Transfer of Securities. The Subscriber will not sell,
assign, gift, pledge or encumber in any manner whatsoever the
Securities herein subscribed without the prior written consent of the
Company and in accordance with applicable securities laws.
The Subscriber agrees that the above representations and warranties of the
Subscriber will be true and correct as of the execution of and acceptance
of this Agreement and will survive the completion of the issuance of the
Securities. The Subscriber understands that the Company will rely on the
representations and warranties of the Subscriber herein in determining
whether a sale of the Securities to the Subscriber is in compliance with
law and the Subscriber warrants to indemnify and hold harmless the Company
from all damages or claims resulting from any misrepresentation by the
Subscriber.
6. Material Changes. The Subscriber undertakes to notify the Company
immediately should there be any material change in the foregoing warranties
and representations and provide the Company with the revised or corrected
information. The Subscriber hereby agrees to indemnify and hold the Company
and its affiliates harmless from and against any and all matters incurred
on account of or arising out of:
(a) Any inaccuracy in the Subscriber's acknowledgments, representations or
warranties set forth in this Agreement;
(b) The Subscriber's disposition of any of the Securities contrary to the
Subscriber's acknowledgments, representations or warranties in this
Agreement;
(c) Any suit or proceeding based upon a claim that said acknowledgments,
representations or warranties were inaccurate or misleading or
otherwise cause for obtaining damages or redress from the Company or
its affiliates or the disposition of all or any part of the
Subscriber's Securities; and
(d) The Subscriber's failure to fulfill any or all of the Subscriber's
obligations herein.
7. Address for Delivery. Each notice, demand or other communication required
or permitted to be given under this Agreement shall be in writing and shall
be sent by delivery (electronic or otherwise) or prepaid registered mail
deposited in a post office in Canada addressed to the Subscriber or the
Company at the address specified in this Agreement. The date of receipt of
such notice, demand or other communication
shall be the date of delivery thereof if delivered, or, if given by
registered mail as aforesaid, shall be deemed conclusively to be the fifth
day after the same shall have been so mailed, except in the case of
interruption of postal services for any reason whatsoever, in which case
the date of receipt shall be the date on which the notice, demand or other
communication is actually received by the addressee.
8. Change of Address. Either party may at any time and from time to time
notify the other party in writing of a change of address and the new
address to which notice shall be given to it thereafter until further
change.
9. Severability and Construction. Each Section, sub-section, paragraph,
sub-paragraph, term and provision of this Agreement, and any portion
thereof, shall be considered severable, and if, for any reason, any portion
of this Agreement is determined to be invalid, contrary to or in conflict
with any applicable present or future law, rule or regulation, that ruling
shall not impair the operation of, or have any other effect upon, such
other portions of this Agreement as may remain otherwise intelligible (all
of which shall remain binding on the parties and continue to be given full
force and agreement as of the date upon which the ruling becomes final).
The word "he" in this Agreement shall also mean she or it relative to the
identity of the Subscriber.
10. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the province of British Columbia and the laws
of Canada applicable therein. Any dispute regarding matters as between the
Subscriber and the Company, whether as a subscriber or shareholder and
whether arising under this Agreement or pursuant to shareholder rights
pursuant to the constating documents of the Company or applicable law,
shall be adjudicated in British Columbia unless the Company shall permit
otherwise.
11. Survival of Representations and Warranties. The covenants, representations
and warranties contained herein shall survive the closing of the
transactions contemplated hereby.
12. Counterparts. This Agreement may be signed by the parties hereto in as many
counterparts as may be necessary, each of which so signed shall be deemed
to be an original, and such counterparts together shall constitute one and
the same instrument and notwithstanding the date of execution will be
deemed to bear the execution date as set forth in this Agreement. This
Agreement may be executed and exchanged by facsimile and such facsimile
copies shall be valid and enforceable agreements.
13. Entire Agreement. This Agreement constitutes the only agreement between the
parties with respect to the subject matter hereof and shall supersede any
and all prior negotiations and understandings. There are no collateral
agreements or understandings hereto and this Agreement, and the documents
contemplated herein, constitutes the totality of the parties' agreement.
This Agreement may be amended or modified in any respect by written
instrument only.
14. Successors and Assigns. The terms and provisions of this Agreement shall be
binding upon and enure to the benefit of the Subscriber, the Company and
their respective successors and lawfully permitted assigns; provided that,
except as herein provided, this Agreement shall not be assignable by any
party without the written consent of the other. The benefit and obligations
of this Agreement, insofar as they extend to or affect the Subscriber,
shall pass with any assignment or transfer of the Securities in accordance
with the terms of this Agreement.
15. Effective Date. This Agreement shall take effect upon the date of
acceptance by the Company.
DATED this ________________ day of _________, 2002.
_____________________________________
(Name of Subscriber - please print) _________________________________
By:____________________________________________
______________________________
(Official Capacity or Title if a company) _________________________________
(Subscriber's Address)
________________________________________ _________________________________
Signature of Subscriber or Official (Telephone Number)
_____________________________________________ _________________________________
(Please print name of individual whose (Facsimile Number)
signature appears above if different than the
name of the Subscriber printed above). _________________________________
(e-mail address)
ACCEPTANCE
Stockgroup Information Systems Inc. hereby accepts the above subscription as of
this ____ day of ___________, 2002.
Executed by )
Stockgroup Information Systems Inc. )
by its authorized signatory: )
)
_______________________________________________ )
Authorized Signatory )
SCHEDULE "B"
Form 45-903F1
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.
BC FORM 45-903F1 (Previously Form 20A(IP))
Securities Act
Acknowledgment of Individual Purchaser
1. I have agreed to purchase from Stockgroup Information Systems Inc. (the
"Issuer")
______________________________________ (the "Securities") of the Issuer.
[number and description of securities].
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
(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
_______________________________ of ____________________________________
(Name of Registered Individual) (Name of Registered Individual's
Registered Dealer)
who advised me that they are 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 received advice from
_______________________________ of ____________________________________
(Name of Registered Individual) (Name of Registered Individual's
Registered Adviser/Dealer)
who advised me that they are:
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 __________ __, 2002.
______________________________________
Signature of Purchaser
______________________________________
Name of Purchaser
______________________________________
Address of Purchaser
SCHEDULE "C"
Form 45-902F2
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.
BC FORM 45-903F2 (Previously Form 20A(NIP))
Securities Act
Acknowledgment of Purchaser that is not an Individual
1. _____________________ (the "Purchaser") has agreed to purchase from
Stockgroup Information Systems Inc. (the "Issuer")
______________________________________ (the "Securities") of the Issuer.
[number and description of securities]
2. The Purchaser is purchasing the Securities as principal, or is a trust
company, insurer or portfolio manager acting on behalf of fully managed accounts
and is deemed to be purchasing as principal under section 74 (1) of the British
Columbia Securities Act (the "Act").
3. On closing of the agreement of purchase and sale, the Purchaser will be the
beneficial owner of the Securities, except where the Purchaser is a trust
company, insurer or portfolio manager acting on behalf of fully managed accounts
under section 74 (1) of the Act.
4. The Purchaser [circle one] has/has not received an offering memorandum
describing the Issuer and the Securities.
5. The Purchaser acknowledges 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) the Purchaser may lose all of its investment, AND
(d) there are restrictions on the Purchaser's ability to resell the Securities
and it is the responsibility of the Purchaser to find out what those
restrictions are and to comply with them before selling the Securities, AND
(e) the Purchaser will not receive a prospectus that the Act would otherwise
require be given to the Purchaser because the Issuer has advised the Purchaser
that the Issuer is relying on a prospectus exemption, AND
(f) because the Purchaser is not purchasing the Securities under a prospectus,
the Purchaser will not have the civil remedies that would otherwise be available
to the Purchaser, AND
(g) the Issuer has advised the Purchaser that the Issuer is using an exemption
from the requirement to sell through a dealer registered under the Act, except
purchases referred to in paragraph 6 (b), and as a result the Purchaser does not
have the benefit of any protection that might have been available to the
Purchaser by having a dealer act on the Purchaser's behalf.
6. The Purchaser acknowledges that:
(a) it is a "sophisticated purchaser" as described in paragraph 2 in the
attached Appendix A [circle the applicable subparagraph in paragraph 2 in
Appendix A]; OR
(b) the Securities were purchased under section 128 (c) ($25,000 - registrant
required) of the Rules and an authorized signatory of the Purchaser has spoken
to
_______________________________ of ___________________________________
(Name of Registered Individual) (Name of Registered Individual's
Registered Dealer)
(the "Registered Person") who advised the authorized signatory that the
Registered Person is registered to trade or advise in the
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Securities and that the purchase of the Securities is a suitable investment for
the Purchaser; OR
(c) the Purchaser is a corporation, all the voting securities of which are
beneficially owned by one or more of:
(i) a close personal friend of a senior officer or director of the Issuer, or of
an affiliate of the Issuer, OR
(ii) a senior officer or director of the Issuer, or of an affiliate of the
Issuer, OR
(iii) a spouse, parent, brother, sister, or child of a senior officer or
director of the Issuer, or of an affiliate of the Issuer.
7. If the Purchaser is referred to in paragraph 6 (a), the Purchaser
acknowledges that, on the basis of information about the Securities furnished by
the Issuer, the Purchaser is able to evaluate the risks and merits of the
Securities because: [circle one]
(a) of the financial, business or investment experience of the Purchaser, OR
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(b) the Purchaser received advice from
_______________________________ of ___________________________________
(Name of Registered Individual) (Name of Registered Individual's
Registered Adviser/Dealer)
(the "Adviser") who advised the Purchaser 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 ________________, 2002.
_________________________________________________
Signature of Authorized Signatory of Purchaser
_________________________________________________
Name and Office of Authorized Signatory of Purchaser
_________________________________________________
Name of Purchaser
_________________________________________________
Address of Purchaser
Appendix A To BC Form 45-903F2 (Previously Form 20A(NIP))
[Circle the applicable subparagraph in paragraph 2.]
"Sophisticated purchaser" means a purchaser that, in connection with a
distribution, gives an acknowledgment under section 135 of the Rules to the
Issuer, where the Issuer does not believe, and has no reasonable grounds to
believe, that the acknowledgment is false, acknowledging both that:
1. the purchaser is able, on the basis of information about the investment
furnished by the Issuer, to evaluate the risks and merits of the prospective
investment because of:
(a) the purchaser's financial, business or investment experience, OR
(b) advice the purchaser receives from a person who is registered to advise, or
is exempted from the requirement to be registered to advise, in respect of the
security that is the subject of the trade (the "Security") and who is not an
insider of, or in a special relationship with, the Issuer of the Security; AND
2. the purchaser is one of the following [circle one]:
(a) a person registered under the Securities Act, OR
(b) an individual who:
(i) has a net worth, or net worth jointly with the individual's spouse, at the
date of the agreement of purchase and sale of the Security, of not less than
$400,000, OR
(ii) has had in each of the 2 most recent calendar years, and reasonably expects
to have in the current calendar year:
A. annual net income before tax of not less than $75,000, OR
B. annual net income before tax, jointly with the individual's spouse, of not
less than $125,000; OR
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(c) a corporation, partnership or trust that:
(i) has net assets of not less than $400,000, OR
(ii) has had in each of the 2 most recent calendar years, and reasonably expects
to have in the current calendar year, net income before tax of not less than
$125,000, OR
(d) a corporation in which all of the voting shares are beneficially owned by
sophisticated purchasers or of which the majority of the directors are
sophisticated purchasers, OR
(e) a general partnership in which all of the partners are sophisticated
purchasers, OR
(f) a limited partnership in which a majority of the general partners are
sophisticated purchasers, OR
(g) a trust in which all of the beneficiaries are sophisticated purchasers or
the majority of the trustees are sophisticated purchasers.