Ontario, Canada
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001-31198
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Not Applicable
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(State or Incorporation)
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(Commission File Number)
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(I.R.S. Employer Identification Number)
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o
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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o
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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o
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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o
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Item 1.01
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Entry into a Material Definitive Agreement.
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Item 2.01
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Completion of Acquisition or Disposition of Assets.
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Item 3.02
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Unregistered Sales of Equity Securities.
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Item 7.01
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Regulation FD Disclosure.
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Item 9.01
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Financial Statements and Exhibits.
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Exhibit
No.
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Description
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1.1*
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Asset Purchase Agreement, dated as of May 21, 2015, by and among Tribute Pharmaceuticals International Inc., Mutual Pharmaceutical Company, Inc. and Sun Pharmaceutical Industries, Inc.
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1.2
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Agency Agreement, dated as of May 21, 2015, by and among Tribute Pharmaceuticals Canada Inc., Dundee Securities Ltd., KES 7 Capital Inc. and Bloom Burton & Co. Inc.
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99.1
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Press Release dated May 21, 2015
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Tribute Pharmaceuticals Canada Inc.
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May 28, 2015
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By:
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/s/ Scott Langille |
Scott Langille | ||
Chief Financial Officer
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Exhibit
No.
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Description
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1.1* |
Asset Purchase Agreement, dated as of May 21, 2015, by and among Tribute Pharmaceuticals International Inc., Mutual Pharmaceutical Company, Inc. and Sun Pharmaceutical Industries, Inc.
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1.2 |
Agency Agreement, dated as of May 21, 2015, by and among Tribute Pharmaceuticals Canada Inc., Dundee Securities Ltd., KES 7 Capital Inc. and Bloom Burton & Co. Inc.
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99.1 |
Press Release dated May 21, 2015
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(i)
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the Inventory;
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(ii)
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the Documentation;
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(iii)
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all Permits (to the extent assignable); and
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(iv)
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all the other intangible assets of MUTUAL related to the Product that are used in connection with MUTUAL’s ongoing commercialization of the Product including, Patents, Trademarks, Know-How, and copyrights.
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(i)
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Five Million Dollars ($5,000,000) on the Closing Date;
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(ii)
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Two Million Dollars ($2,000,000) on the date that is one hundred eighty days (180) from the Closing Date; and
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(iii)
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Three Million Dollars ($3,000,000) on the date that is three hundred sixty five days (365) from the Closing Date.
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Net Sales Milestone
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Milestone Payment (USD)
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First calendar year to achieve $[**]6 in Net Sales
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$[**]7
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First calendar year to achieve $[**]8 in Net Sales
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$[**]9
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First calendar year to achieve $[**]10 in Net Sales
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$[**]11
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(i)
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Milestone Conditions.
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(A)
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All milestone payments are payable only once and only one such payment is payable in any calendar year. Each milestone payment will be payable by TRIBUTE to MUTUAL within ninety (90) days following the end of the calendar quarter in which the Net Sales milestone was achieved.
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(B)
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TRIBUTE shall be obligated to pay milestone payments only until a Third Party Generic Equivalent Permitted Launch.
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Royalty Rate
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Net Sales in Calendar Year (USD)
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[**]12 %
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[**]13
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[**]14 %
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[**]15
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[**]16 %
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[**]17
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(i)
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sold the Product to wholesalers and distributors outside of its past practices.
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(ii)
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engaged in any practice with the intent of increasing the levels of inventory of the Product outside of the ordinary course of business and in anticipation of entering into this Agreement or any similar transaction with respect to the Products; or
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(iii)
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sold, licensed, leased subleased, encumbered, assigned or otherwise disposed of, or entered into any Contract to sell, license, lease, encumber, assign or otherwise dispose of, any of the Purchased Assets, other than sales or returns of obsolete or surplus equipment in the ordinary course of business.
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(i)
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Schedule 1(lll) hereto contains a complete and accurate list of all trademark registrations owned by MUTUAL in the United States relating to the Product, and all of the same are unexpired and subsisting and have not been abandoned, cancelled, or dedicated to the public.
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(ii)
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Schedule 1(rr) hereto contains a complete and accurate list of all patents owned by MUTUAL in the Territory relating to the Product, and all of the same are unexpired and subsisting and have not been abandoned, cancelled, or dedicated to the public.
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(iii)
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To MUTUAL’s Knowledge (i), the making, having made, using or selling of the Product does not infringe any issued patent owned by a third party, (ii) the Trademarks as used in the advertising, marketing, offer for sale and/or sale of the goods set forth in the goods and services description for each, do not infringe any registered trademark in the Territory owned by a third party and (iii) none of MUTUAL or SUN have received any written or other notice from a third party that the making, having made, using or selling of the Product, as conducted by MUTUAL or SUN prior to the Closing Date, if applicable, infringes the intellectual property rights of any third party.
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(iv)
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MUTUAL has taken and/or adopted commercially reasonable procedures, systems and policies to maintain each Patent and Trademark and to safeguard and maintain secret and confidential the relevant Know-How that they own or use, where appropriate.
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(v)
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There is no proceeding pending against MUTUAL or SUN regarding the Products or, to MUTUAL’s Knowledge, threatened against MUTUAL or SUN regarding the Products, at law or in equity or by or before any Governmental Entity that challenges, or may have the effect of preventing, delaying or making illegal or otherwise interfering with, any of the transactions contemplated by this Agreement.
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(vi)
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MUTUAL has not put any third party on written notice that such third party is infringing upon or is otherwise violating or misappropriating MUTUAL’s Patents, Trademarks or its Know-How.
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(vii)
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MUTUAL does not own any existing patents or pending patent applications related to the Product other than those identified in Schedule 1(rr).
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(i)
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To MUTUAL’s Knowledge, the Product has been tested, manufactured, supplied, promoted, distributed, marketed, commercialized, stored, and sold, as applicable, by MUTUAL and SUN, in compliance in all material respects with all Applicable Laws. The Product is not adulterated or misbranded within the meaning of the FDA Act or any similar governmental act or Applicable Law of any jurisdiction.
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(ii)
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To MUTUAL’s Knowledge, MUTUAL has made available to TRIBUTE complete and correct copies of : (i) the NDA and each Investigational New Drug application (“IND”) submitted by or on behalf of MUTUAL to the FDA with respect to the Product; (ii) all other material documents, correspondence, filings or other communications submitted to a Governmental Entity by or on behalf of MUTUAL or received from a Governmental Entity by or on behalf of MUTUAL, in each case, with respect to the Products, (iii) all material scientific, clinical and safety data of MUTUAL with respect to the Products; and (iv) all audit reports performed by MUTUAL or on its behalf to assess MUTUAL’s compliance with Applicable Laws.
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(iii)
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With respect to the Product, MUTUAL has not received in the last 12 months, nor is there any pending or outstanding: [**]21, have been received by MUTUAL from the FDA or any other Governmental Entity relating to the Products, or any facility in which the Products are manufactured, packaged or stored, and that assert ongoing material lack of compliance with any such Applicable Laws by MUTUAL.
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(iv)
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There is no proceeding pending or, to MUTUAL’s Knowledge, threatened in writing against MUTUAL that would reasonably be expected to result in the exclusion of MUTUAL from any third party payment program in which they participate.
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(v)
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To MUTUAL’s Knowledge, no director, officer, employee or agent of MUTUAL: (A) has been convicted of any crime or engaged in any conduct for which debarment or similar punishment is mandated or permitted by 21 U.S.C. § 335a(a) or any similar Laws or authorized by 21 U.S.C. § 335a(b) or any similar Laws; and (B) has been convicted of any crime or engaged in any conduct for which such Person could be excluded from participating in the Federal health care programs under Section 1128 of the Social Security Act of 1935, as amended, or any similar Laws.
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Year
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Gross Sales
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Net Sales
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2012
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$[**]22
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$[**]23
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2013
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$[**]24
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$[**]25
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2014
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$[**]26
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$[**]27
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(i)
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Upon the terms and subject to the conditions hereof, each of the Parties shall use commercially reasonable efforts to take, or cause to be taken, all appropriate action, and to do, or cause to be done, all things necessary, proper or advisable under Applicable Law to consummate and make effective the transactions contemplated hereby. In the event that at any time after the Closing any further action is necessary or desirable to carry out the purposes of this Agreement or the Transaction Documents, each Party shall use reasonable efforts to promptly take all such action. Without limiting the foregoing, MUTUAL shall, from time to time, execute and deliver all such other and further materials and documents and instruments of conveyance, transfer or assignment as may be reasonably requested by TRIBUTE to effect, record or verify the transfer to, and vesting in TRIBUTE of, all of MUTUAL’s right, title and interest in and to the Purchased Assets, free and clear of all Liens, other than Permitted Liens in accordance with the terms of this Agreement.
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(ii)
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After the date hereof, MUTUAL shall consult with TRIBUTE prior to making any filings with, or having any communications with, any Governmental Entity with respect to the Product in the Territory.
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(i)
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Notwithstanding any other provision of this Agreement, each Obligated Party may disclose Confidential Information of the Owning Party: (a) in response to a valid, competent and binding order of a Governmental Entity; (b) if required by law or regulation; provided, however, that in the case of (a) and (b) the Obligated Party shall first have, to the extent legally permitted, given reasonable prior notice to the Owning Party of such pending disclosure and shall have, to extent reasonably requested by and at the sole expense of the Owning Party, made a reasonable effort to obtain a protective order, or to cooperate with the Owning Party’s efforts, as applicable, to obtain a protective order limiting the extent of such disclosure and requiring that the Confidential Information so disclosed be used only for the purposes for which such order was issued or as required by such law or regulation; (c) to the extent and to the Persons required by rules of any applicable stock exchange or securities regulatory authority; or (d) as necessary to prosecute or defend litigation, including litigation between the Parties, or otherwise establish rights or enforce obligations pursuant to procedures, if any, described in this Agreement, but only to the extent that any such disclosure is necessary for such purposes. Notwithstanding the preceding sentence or Section 10(c) hereof, either Party shall be free to disclose, without the other Party’s prior consent, the existence of this Agreement, the identity of the other Party and other information relating to the transactions contemplated hereunder that is required to be disclosed under applicable securities laws and other Applicable Law. Any Obligated Party (and any employee, representative, or other agent of any Obligated Party) may disclose to any and all Persons, without limitation of any kind, the tax treatment and tax structure of the transactions contemplated by this Agreement and all materials of any kind (including opinions or other tax analyses) that are provided to it relating to such tax treatment and tax structure; provided however, that no Obligated Party will be permitted to disclose such tax treatment or tax structure to the extent that such disclosure would constitute a violation of Applicable Law. For the purposes of this Section 10(b), (y) the “tax treatment” of a transaction means the purported or claimed federal, provincial or state income tax treatment of the transaction, and (z) the “tax structure” of a transaction means any fact that may be relevant to understanding the purported or claimed federal, provincial or state income tax treatment of the transaction. Thus, for the avoidance of doubt, the Obligated Parties acknowledge and agree that the tax treatment and tax structure of any transaction does not include the name of any Owning Party to a transaction or any sensitive business information (including the name and other specific information about any Owning Party’s intellectual property or other proprietary assets) unless such information may be related or relevant to the purported or claimed federal income tax treatment of the transaction.
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(ii)
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Notwithstanding the foregoing prohibition on disclosure of the Confidential Information, the Obligated Party may disclose the terms of this Agreement in accordance with Section 10(b)(i) hereof or, in the event that the terms of this Agreement have not previously been disclosed in accordance with Section 10(b)(i) hereof, to: (A) third parties for due diligence purposes or similar investigations in connection with corporate financing transactions, as long as such disclosure is made under confidentiality obligations substantially as protective as those of this Article 10; (B) any Affiliates or permitted licensees or sublicensees, as long as such disclosure is made under such confidentiality obligations; and (C) any third party in connection with any proposed assignment in accordance with Section 15(c) hereof, as long as such disclosure is made under such confidentiality obligations.
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Patent No
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Patent Expiration
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Patent Title/Abstract
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7569612
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20-Aug-27
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Method of Use of Fenofibric acid
treatment for primary hypercholesterolemia or mixed hyperlipidemia, comprising
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7741373
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20-Aug-27
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Method of Use of Fenofibric acid treating a patient in need of treatment for Hypertriglyceridemia
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7741374
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20-Aug-27
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Method of Use of Fenofibric acid 1) treatment for an indication involving increased cholesterol and/or lipid levels
2) treatment for mixed Dyslipidemia
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7915247
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20-Aug-27
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Method of Use of Fenofibric acid treatment for primary hypercholesterolemia, Hypertriglyceridemia, mixed Dyslipidemia, or mixed hyperlipidemia
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Name
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Strength
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Form
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Packaging
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NDA
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Fibricor®
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35mg
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Tablet
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HDPE Bottles
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022418
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Fibricor®
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105mg
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Tablet
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HDPE Bottles
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022418
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Fenofibric acid (authorized generic of Fibricor®
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35mg
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Tablet
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HDPE Bottles
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022418
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Fenofibric acid (authorized generic of Fibricor®
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105mg
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Tablet
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HDPE Bottles
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022418
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Submission Type
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Control No.
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Approval Date
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NDA 22418
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0000 through 0043
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August 14, 2009
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Country
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Trademark
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Status
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Appl. No./
Reg. No.
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Filing Date/
Reg. Date
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Owner
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Goods
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Next Deadline
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USA
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Fibricor
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Registered
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77574728
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September 19, 2008
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MUTUAL
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1.
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Definitions
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(a)
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“Agent” and “Agents” have the respective meanings given to them above;
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(b)
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“Agents’ Counsel” means Dentons Canada LLP;
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(c)
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“Agents’ Fee” has the meaning given in Section 1(1)(a);
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(d)
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“Agreement” means the agreement resulting from the acceptance by the Corporation of the offer made by the Agents by this letter;
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(e)
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“Applicable Securities Laws” means all applicable securities laws, rules, regulations, notices and published policies of the Selling Jurisdictions in Canada and the United States;
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(f)
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“Business Day” means any day other than a Saturday, Sunday or statutory or civic holiday in Toronto, Ontario;
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(g)
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“Closing” means the completion of the Offering;
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(h)
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“Closing Date” means May 21, 2015 or such other date as the Corporation and the Agents may agree upon in writing, or as may be changed pursuant to this Agreement;
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(i)
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“Closing Time” means 8:00 a.m. (Toronto time) on the Closing Date;
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(j)
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“Corporation” has the meaning given to it above;
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(k)
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“Corporation’s Auditors” means such firm of chartered accountants as the Corporation may have appointed or may from time to time appoint as auditors of the Corporation, including prior auditors of the Corporation, as applicable;
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(l)
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“Corporation’s Counsel” means Fogler Rubinoff LLP;
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(m)
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“Compensation Options” has the meaning ascribed thereto on the face page of this Agreement;
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(n)
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“Compensation Option Certificates” shall mean the certificates representing the Compensation Options;
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(o)
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“Debt Instrument” means any loan, bond, debenture, promissory note or other instrument evidencing indebtedness (demand or otherwise) for borrowed money or other liability;
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(p)
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“Due Diligence Session” means the due diligence question and answer session held with management of the Corporation on May 21, 2015 and July 14, 2014;
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(q)
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“Environmental Laws” means any federal, state, provincial, territorial or local law, statute, ordinance, rule, regulation, order, decree, judgment, injunction, permit, license, authorization or other binding requirement, or common law, relating to health, safety or the regulation, protection, cleanup or restoration of the environment or natural resources, including those relating to the distribution, processing, generation, treatment, control, storage, disposal, transportation, other handling or release or threatened release of Hazardous Materials or Conditions, and “Hazardous Materials or Conditions” means any material, substance (including, without limitation, pollutants, contaminants, hazardous or toxic substances or wastes) or condition that is regulated by or may give rise to liability under any Environmental Laws;
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(r)
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“Financial Statements” means the audited consolidated financial statements of the Corporation as at and for the years ended December 31, 2013 and 2014 and for the unaudited interim financial statements for the period ended March 31, 2015 together with the notes thereto;
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(s)
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“Governmental Authority (ies)” means governments, regulatory authorities, governmental departments, agencies, commissions, bureaus, officials, ministers, Crown corporations, courts, bodies, boards, tribunals or dispute settlement panels or other law, rule or regulation-making organizations or entities:
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(i)
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having or purporting to have jurisdiction over the Corporation on behalf of any nation, province, territory or state or any other geographic or political subdivision of any of them; or
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(ii)
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exercising, or entitled or purporting to exercise any administrative, executive, judicial, legislative, policy, regulatory or taxing authority or power over the Corporation;
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(t)
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“Indemnified Party” has the meaning given to it in Section 11(b);
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(u)
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“Lead Agent” has the meaning given to it above;
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(v)
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“Material Adverse Effect” or “Material Adverse Change” means any effect, change, event or occurrence that is, or is reasonably likely to be, materially adverse to the results of operations, condition (financial or otherwise), assets, properties, capital, liabilities (contingent or otherwise), cash flow, income or business operations of the Corporation and its subsidiaries taken as a whole;
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(w)
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“Material Agreement” means any note, indenture, mortgage or other form of indebtedness and any contract, commitment, agreement (written or oral), joint venture instrument, lease or other document to which the Corporation is a party and which is material to the Corporation on a consolidated basis;
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(x)
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“notice” has the meaning given to it in Section 21;
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(y)
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“Offered Shares” has the meaning given to it above;
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(z)
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“Offering” has the meaning given to it above;
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(aa)
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“Offering Price” has the meaning given to it above;
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(bb)
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“Person” means any individual, sole proprietorship, partnership, firm, entity, unincorporated association, unincorporated syndicate, unincorporated organization, trust, body corporate, limited liability company and unlimited liability company;
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(cc)
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“Public Record” means the public disclosure of the Corporation filed on SEDAR;
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(dd)
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“SEC” means the United States Securities and Exchange Commission;
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(ee)
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“SEDAR” means the System for Electronic Document Analysis and Retrieval;
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(ff)
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“Securities Commissions” means the securities commissions or similar regulatory authorities in the Selling Jurisdictions;
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(gg)
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“Selling Jurisdictions” means all of the provinces of Canada, the United States and such other jurisdictions as the Agents and the Corporation may agree;
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(hh)
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“Subscriber” means, for the purposes of this Agreement, the person who executes a Subscription Agreement or, if such person executes a Subscription Agreement as a duly authorized agent of one or more principals, the principal or principals of such person;
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(ii)
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“Subscription Agreements” means the agreements entered into by each Subscriber and the Corporation in respect of the Subscriber’s subscription for Offered Shares in the form and on terms and conditions satisfactory to each of the Corporation and the Agents, each acting reasonably;
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(jj)
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“TSX-V” means the TSX Venture Exchange;
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(kk)
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“United States” means the United States of America, its territories and possessions, any state of the United States, and the District of Columbia; and
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(ll)
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“U.S. Securities Act” means the United States Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
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(a)
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words used herein importing the singular number include the plural and vice versa, words importing the use of any gender include all genders, and words importing persons include individuals, partnerships, associations, trusts, unincorporated organizations and corporations, and the rest of the sentence is construed as if the necessary grammatical and terminological changes had been made;
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(b)
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references herein to any agreement or instrument, including this Agreement, are deemed to be references to the agreement or instrument as varied, amended, modified, supplemented or replaced from time to time, and any specific references herein to any legislation or enactment are deemed to be references to such legislation or enactment as the same may be amended or replaced from time to time; and
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(c)
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all dollar amounts in this Agreement are expressed in Canadian dollars except where expressly indicated otherwise.
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2.
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Restrictions on Sale
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(a)
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not solicit subscriptions for Offered Shares, trade in Offered Shares or otherwise do any act in furtherance of a trade of Offered Shares outside of the Selling Jurisdictions;
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(b)
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in connection with the offer and sale of the Offered Shares in Canada, the Agents will only offer and sell the Offered Shares to persons resident in Canada who are:
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(i)
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“accredited investors” (as defined in National Instrument 45-106 – Prospectus Exemptions or, in Ontario, Section 73.3 of the Securities Act (Ontario)), and
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(ii)
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purchasing as principals; and
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(c)
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not advertise the proposed sale of the Offered Shares in printed media of general and regular paid circulation, radio, television or the internet nor provide or make available to prospective purchasers of Offered Shares any document or material which would constitute an offering memorandum as defined in Applicable Securities Laws in Canada.
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3.
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Delivery of Subscription Agreements
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4.
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Representations and Warranties of the Corporation
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(a)
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the Corporation (i) is duly amalgamated under the Business Corporations Act (Ontario) (the “Act”) and is up-to-date in respect of all material corporate filings and is in good standing under such Act; (ii) has all requisite corporate power, authority and capacity to carry on its business as now conducted and to own, lease and operate its properties and assets (including as described in the Public Disclosure); and (iii) has all requisite corporate power, authority and capacity to create, issue and sell the Offered Shares, to enter into this Agency Agreement and the Compensation Option Certificates, and to carry out the provisions contained in hereunder and thereunder;
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(b)
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the Corporation does not have any material subsidiaries;
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(c)
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no proceedings have been taken, instituted or, to the knowledge of the Corporation, are pending for the dissolution or liquidation of the Corporation;
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(d)
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the Corporation has conducted its business in compliance, in all material respects, with all applicable laws, rules and regulations (including all applicable federal, national, provincial, municipal, and local environmental anti-pollution and licensing laws, regulations and other lawful requirements of any governmental or regulatory body, of each jurisdiction in which its business is carried on and is licensed, registered or qualified in all jurisdictions in which it owns, leases or operates its property or carries on business to enable its business to be carried on as now conducted and its property and assets to be owned, leased and operated and all such licences, registrations and qualifications are valid, subsisting and in good standing and it has not received a notice of non-compliance, nor knows of, nor has reasonable grounds to know of, any facts that could give rise to a notice of non-compliance with any such laws, regulations or permits which could reasonably be expected to have a Material Adverse Effect and all such licences, registrations and qualifications are valid, subsisting and in good standing;
|
(e)
|
all necessary corporate action has been taken or will have been taken prior to the Closing Time by the Corporation so as to validly issue and sell the Offered Shares and to issue the Compensation Options;
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(f)
|
except for the approval of the TSXV and any post-closing notice filings required under applicable United States federal or state securities laws, all consents, approvals, authorizations and corporate action have been taken and all necessary documents have been delivered and executed with respect to the Offering;
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(g)
|
the execution and delivery of this Agency Agreement and the Compensation Option Certificates, and the performance of the transactions contemplated hereby and thereby, including the issuance and sale of the Offered Shares, have been duly authorized by all necessary corporate action of the Corporation and this Agency Agreement has been executed and delivered by the Corporation and constitutes a valid and binding obligation of the Corporation, enforceable against the Corporation in accordance with its terms, provided that enforcement thereof may be limited by laws affecting creditors’ rights generally, that specific performance and other equitable remedies may only be granted in the discretion of a court of competent jurisdiction, that the provisions thereof relating to indemnity, contribution and waiver of contribution may be unenforceable under applicable law and that enforceability is subject to the provisions of the Limitations Act, 2002 (Ontario);
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(h)
|
except for any post-closing notice filings required under applicable United States federal or state securities laws, the execution and delivery of this Agency Agreement and the Compensation Option Certificates, and the fulfilment of the terms hereof and thereof by the Corporation, including the issuance and sale of the Offered Shares, do not and will not require the consent, approval, authorization, registration or qualification of or with any Governmental Authority, stock exchange, Securities Commission or other third party, except such as have been obtained or such as may be required (and shall be obtained prior to the Closing Time) under Applicable Securities Laws or stock exchange regulations;
|
(i)
|
the Offered Shares have been, or prior to the Closing Time will be, duly and validly authorized for issuance and, upon receipt by the Corporation of the purchase price for the Offered Shares, will be validly issued as fully paid and non-assessable Common Shares;
|
(j)
|
the Compensation Options have been, or prior to the Closing Time will be duly and validly authorized and created;
|
(k)
|
the Compensation Option Shares to be issued upon exercise of the Compensation Options, including payment in full of the applicable exercise price, will be validly issued as fully paid and non-assessable Common Shares;
|
(l)
|
the authorized capital of the Corporation consists of an unlimited number of Common Shares, of which, as of May 20, 2015, 100,675,988 Common Shares were outstanding as fully paid and non-assessable Common Shares;
|
(m)
|
the Corporation is not aware of any legislation, or proposed legislation published by a legislative body, which it anticipates will materially and adversely affect the business, affairs, operations, assets, liabilities (contingent or otherwise) or prospects of the Corporation on a consolidated basis;
|
(n)
|
no order ceasing or suspending trading in any securities of the Corporation or prohibiting the sale of the Offered Shares or the trading of any of the Corporation’s issued securities has been issued and no proceedings for such purpose are threatened or, to the best of the Corporation’s knowledge, pending;
|
(o)
|
except as disclosed to the Agents, no person now has any agreement or option or right or privilege (whether at law, pre-emptive or contractual) capable of becoming an agreement for the purchase, subscription or issuance of, or conversion into, any unissued shares, securities, warrants or convertible obligations of any nature of the Corporation;
|
(p)
|
since December 31, 2013, except as disclosed in the Public Record:
|
(i)
|
there has not been any material change in the assets, liabilities, obligations (absolute, accrued, contingent or otherwise), business, condition (financial or otherwise) or results of operations of the Corporation on a consolidated basis;
|
(ii)
|
there has not been any material change in the capital stock or long-term debt of the Corporation on a consolidated basis; and
|
(iii)
|
the Corporation has carried on its business in the ordinary course;
|
(q)
|
the Financial Statements of the Corporation present fairly, in all material respects, the financial condition of the Corporation on a consolidated basis for the periods then ended;
|
(r)
|
the Corporation does not have any liabilities, direct or indirect, contingent or otherwise, not disclosed in the Public Record which could reasonably be expected to have a Material Adverse Effect;
|
(s)
|
except as disclosed in the Public Record (and certain other matters disclosed in writing to the Agents that the Corporation believes are without merit and/or would not have a Material Adverse Effect), there are no threats of actions, proceedings or investigations (whether or not purportedly by or on behalf of the Corporation) that have been made to the Corporation or, to the knowledge of the Corporation, that are pending or affecting the Corporation at law or in equity (whether in any court, arbitration or similar tribunal) or before or by any federal, provincial, state, municipal or other governmental department, commission, board or agency, domestic or foreign, which could reasonably be expected to have a Material Adverse Effect;
|
(t)
|
the execution and delivery of this Agency Agreement and the Compensation Option Certificates, and the fulfilment of the terms hereof and thereof by the Corporation, including the issuance and sale of the Offered Shares, do not and will not (as the case may be) conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, whether after notice or lapse of time or both, (A) any statute, rule or regulation applicable to the Corporation, including Applicable Securities Laws; (B) the constating documents, by-laws or resolutions of the Corporation; (C) the terms of any Debt Instrument, Material Agreement, mortgage, note, indenture, instrument, lease or any other material agreement to which the Corporation is a party or by which they are bound; or (D) any judgment, decree or order binding the Corporation or the respective property or assets of the Corporation;
|
(u)
|
to the knowledge of the Corporation, no agreement is in force or effect which in any manner affects the voting or control of any of the securities of the Corporation;
|
(v)
|
the Corporation is not included in a list of defaulting reporting issuers maintained by the Securities Commissions in the Qualifying Jurisdictions and in particular, without limiting the foregoing, the Corporation has at all relevant times complied with its obligations to make timely disclosure of all material changes relating to it, no such disclosure has been made on a confidential basis that is still maintained on a confidential basis, and there is no material change relating to the Corporation which has occurred and with respect to which the requisite material change report has not been filed with the Securities Commissions and the Corporation is in all material respects in compliance with the rules and regulations of the TSXV;
|
(w)
|
the Corporation has complied in all material respects with requirements to file all reports, schedules, forms, statements and other documents that it is required to file under the U.S. Exchange Act, including pursuant to Section 13(a) or 15(d) of the U.S. Exchange Act, including the exhibits thereto and documents incorporated by reference therein, being collectively referred to herein as the “SEC Reports”) on a timely basis or has received a valid extension of such time of filing and has filed any such SEC Reports prior to the expiration of any such extension. As of their respective dates, the SEC Reports complied in all material respects with the respective requirements of the U.S. Exchange Act and the rules and regulations of the SEC promulgated thereunder. The financial statements of the Corporation included in the SEC Reports comply in all material respects with applicable accounting requirements and the rules and regulations of the Commission with respect thereto as in effect at the time of filing. Such financial statements have been prepared in accordance with U.S. generally accepted accounting principles applied on a consistent basis during the periods involved (“GAAP”), except as may be otherwise specified in such financial statements or the notes thereto and except that unaudited financial statements may not contain all footnotes required by GAAP, and fairly present in all material respects the financial position of the Corporation as of and for the dates thereof and the results of operations and cash flows for the periods then ended, subject, in the case of unaudited statements, to normal, immaterial, year-end audit adjustments;
|
(x)
|
neither the Corporation nor, to the knowledge of the Corporation, any director, officer, agent, employee, affiliate or other person acting on behalf of the Corporation is aware of or has taken any action, directly or indirectly, that has resulted or would result in a violation of the Foreign Corrupt Practices Act of 1977 (United States), as amended, and the rules and regulations thereunder (the “FCPA”), and the Corruption of Foreign Public Officials Act (Canada) (the “CFPOA”) including, without limitation, making use of the mails or any means or instrumentality of interstate commerce corruptly in furtherance of an offer, payment, promise to pay or authorization of the payment of any money, or other property, gift, promise to give, or authorization of the giving of anything of value to any “foreign official” (as such term is defined in the FCPA) or any “foreign public official” (as such term is defined in the CFPOA) or any foreign political party or official thereof or any candidate for foreign political office, in contravention of the FCPA and the CFPOA; and the Corporation will monitor its respective businesses to ensure compliance with the FCPA and the CFPOA, as applicable, and, if violations of the FCPA or the CFPOA are found, will take remedial action to remedy such violations;
|
(y)
|
the operations of the Corporation are, and have been conducted at all times, in compliance with all material applicable financial recordkeeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970 (United States), as amended, the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (Canada), the money laundering statutes of all applicable jurisdictions, the rules and regulations thereunder and any related or similar applicable rules, regulations or guidelines, issued, administered or enforced by any governmental agency (collectively, the “Money Laundering Laws”) and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Corporation with respect to the Money Laundering Laws is pending or, to the knowledge of the Corporation, threatened;
|
(z)
|
neither the Corporation nor, to the knowledge of the Corporation, any director, officer, agent, employee, affiliate or person acting on behalf of the Corporation is currently subject to any United States sanctions administered by the Office of Foreign Assets Control of the United States Treasury Department (“OFAC”); and the Corporation will not directly or indirectly use the proceeds of this Offering, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other person or entity, for the purpose of financing the activities of any person currently subject to any United States sanctions administered by OFAC;
|
(aa)
|
all filings and fees required to be made and paid by the Corporation pursuant to Applicable Securities Laws have been paid or will be promptly paid by the Corporation following the Closing Time;
|
(bb)
|
the Corporation’s Auditors who audited the consolidated financial statements of the Corporation for the year ended December 31, 2014 and delivered their auditors’ report thereto are independent public accountants as required by the Canadian Securities Laws;
|
(cc)
|
there has not been any “reportable event” (within the meaning of National Instrument 51- 102 – Continuous Disclosure Obligations with the Corporation’s Auditors;
|
(dd)
|
all taxes (including income tax, capital tax, payroll taxes, employer health tax, workers’ compensation payments, property taxes, custom and land transfer taxes), duties, royalties, levies, imposts, assessments, deductions, charges or withholdings and all liabilities with respect thereto including any penalty and interest payable with respect thereto (collectively, “Taxes”) due and payable by the Corporation have been paid, except for where the failure to pay such taxes would not constitute an adverse material fact of the Corporation or result in a Material Adverse Effect. All tax returns, declarations, remittances and filings required to be filed by the Corporation have been filed with all appropriate Governmental Authorities and all such returns, declarations, remittances and filings are complete and materially accurate and no material fact or facts have been omitted therefrom which would make any of them misleading except where the inaccuracy or failure to file such documents would not constitute an adverse material fact of the Corporation or result in a Material Adverse Effect. No examination of any tax return of the Corporation is currently in progress and there are no issues or disputes outstanding with any Governmental Authority respecting any taxes that have been paid, or may be payable, by the Corporation, in any case, except where such examinations, issues or disputes would not constitute an adverse material fact of the Corporation or result in a Material Adverse Effect;
|
(ee)
|
neither the Corporation or to the knowledge of the Corporation any other person, is in default in the observance or performance of any term, covenant or obligation to be performed by the Corporation or such other person under any Debt Instrument, Material Agreement, agreement, or arrangement to which the Corporation is a party or otherwise bound which could reasonably be expected to have a Material Adverse Effect, and all such contracts, agreements or arrangements are in good standing, and to the knowledge of the Corporation no event has occurred which with notice or lapse of time or both would constitute such a default by the Corporation or any other party;
|
(ff)
|
Equity Financial Trust Company at its principal transfer office in the City of Toronto, Ontario has been duly appointed as the registrar and transfer agent for the Common Shares;
|
(gg)
|
except as disclosed in the Public Record, none of the directors or officers of the Corporation, any known holder of more than 10% of any class of shares of the Corporation, or any known associate or affiliate of any of the foregoing persons, has had any material interest, direct or indirect, in any transaction during the three most recently completed financial years or during the current financial year, or any proposed material transaction which, as the case may be, materially affected, is material to or will materially affect the Corporation on a consolidated basis;
|
(hh)
|
each Debt Instrument to which the Corporation is a party is in good standing and the Corporation is not in default of any obligation or covenant under such Debt Instruments and, except for intercompany debt, the Corporation is not party to any material Debt Instrument or has any material loans or other indebtedness outstanding which has been made to any of its shareholders, officers, directors or employees, past or present, or any person not dealing at arm’s length with them;
|
(ii)
|
the Corporation is in compliance, in all material respects, with all applicable federal, provincial, state, municipal and local laws, statutes, ordinances, by laws and regulations and orders, directives and decisions rendered by any ministry, department or administrative or regulatory agency, domestic or foreign (the “Environmental Laws”) relating to the protection of the environment, occupational health and safety or the processing, use, treatment, storage, disposal, discharge, transport or handling of any pollutants, contaminants, chemicals or industrial, toxic or hazardous wastes or substance (“Hazardous Substances”);
|
(jj)
|
the Corporation has collectively, obtained all material licences, permits, approvals, consents, certificates, registrations and other authorizations under all applicable Environmental Laws (the “Environmental Permits”) necessary as at the date hereof for the operation of the business carried by the Corporation;
|
(kk)
|
the Corporation has not used, except in compliance in all material respects with all Environmental Laws and Environmental Permits, any property or facility which it owns or leases or previously owned or leased, to generate, manufacture, process, distribute, use, treat, store, dispose of, transport or handle any Hazardous Substance;
|
(ll)
|
the Corporation has not received any notice of, or been prosecuted for an offence alleging, non-compliance with any Environmental Law. There are no orders or directions relating to environmental matters requiring any material work, repairs, construction or capital expenditures to be made with respect to any of the assets of the Corporation which are material to the Corporation, nor has the Corporation received notice of any of the same;
|
(mm)
|
the Corporation has not received any notice wherein it is alleged or stated that it is potentially responsible for a federal, provincial, state, municipal or local clean-up site or corrective action under any Environmental Laws and the Corporation has not received any request for information in connection with any federal, state, provincial, municipal or local inquiries as to disposal sites;
|
(nn)
|
except as disclosed in the Public Record, the Corporation is the sole and exclusive owner of all right, title and interest in and to, or has a valid and enforceable right to use pursuant to a written license, all trademarks, trade names, service marks, patents, patent applications, other patent rights, copyrights, domain names, software, inventions, processes, databases, know-how (including trade secrets and other unpatented and/or unpatentable proprietary or confidential information, systems or procedures) and other similar intellectual property rights, whether registered or unregistered and in any jurisdiction (collectively, “Intellectual Property Rights”) reasonably necessary to conduct its business as now conducted or proposed to be conducted. To the knowledge of the Corporation, the Corporation’s business as now conducted or proposed to be conducted as described in the Public Record, does not infringe, conflict with or otherwise violate any Intellectual Property Rights of others, and the Corporation has not received, and has no reason to believe that it will receive, any notice of infringement or conflict with asserted Intellectual Property Rights of others, or any facts or circumstances which would render any Intellectual Property Rights invalid or inadequate to protect the interest of the Corporation therein. Except as disclosed to the Agent, to the knowledge of the Corporation, there is no infringement by third parties of any Intellectual Property Rights owned by the Corporation. Except as disclosed in the Public Record, there is no pending or, to the knowledge of the Corporation, threatened action, suit, proceeding or claim relating to Intellectual Property Rights owned by the Corporation. Except as disclosed in the Public Record, the Corporation is not a party to or bound by any options, licenses or agreements with respect to the Intellectual Property Rights of any other person or entity. All licenses for Intellectual Property Rights owned or used by the Corporation are valid, binding upon and enforceable by or against the Corporation and, to the Corporation’s knowledge, against the parties thereto in accordance with their terms. To the knowledge of the Corporation, none of the technology employed by the Corporation has been obtained or is being used by the Corporation in violation of any contractual obligation binding on the Corporation or, to the Corporation’s knowledge, any of its officers, directors or employees or otherwise in violation of the rights of any third party. All assignments from inventors to the Corporation have been obtained and filed with the appropriate patent offices for all of the Corporation’s patent applications. Except as disclosed in the Public Record the Corporation does not have knowledge of any claims of third parties to any ownership interest or lien with respect to the Corporation’s or its licensors’ patents and patent applications. The Corporation does not know of any facts which would form a basis for a finding of unenforceability or invalidity of any of the patents, trademarks or service marks of the Corporation. The Corporation does not know of any material defects of form in the preparation or filing of the patent applications of the Corporation. To the knowledge of the Corporation, the Corporation has complied with the U.S. Patents and Trademark Office duties and Canadian equivalent duties of candor and disclosure for each patent and patent application of the Corporation. The Corporation does not know of any fact with respect to the patent applications of the Corporation presently on file that (i) would preclude the issuance of patents with respect to such applications, (ii) would lead the Corporation to conclude that such patents, when issued, would not be valid and enforceable in accordance with applicable regulations or (iii) would result in a third party having any rights in any patents issuing from such patent applications. The Corporation has taken all commercially reasonable steps to protect, maintain and safeguard its rights in all material Intellectual Property Rights, including the execution of appropriate nondisclosure and confidentiality agreements;
|
(oo)
|
except as disclosed to the Agents, the Corporation (or parties under contractual obligation to the Corporation) holds all licenses, certificates, approvals and permits from all provincial, federal, state, United States, foreign and other regulatory authorities, including but not limited to the United States Food and Drug Administration (the “FDA”), Health Canada (“HC”), the European Medicines Agency (the “EMA”) and any foreign regulatory authorities performing functions similar to those performed by the FDA, HC and the EMA, that are material to the conduct of the business of the Corporation as such business is now conducted or proposed to be conducted as described in the Public Record, all of which are valid and in full force and effect and there is no proceeding pending or, to the knowledge of the Corporation, threatened which may cause any such license, certificate, approval or permit to be withdrawn, cancelled, suspended or not renewed. Nothing has come to the attention of the Corporation that has caused the Corporation to believe that the completed studies, tests, preclinical studies and clinical trials conducted by or on behalf of the Corporation that are described in the Public Record were not conducted, in all material respects, in accordance with experimental protocols, procedures and controls pursuant to, where applicable, accepted professional and scientific standards for products or product candidates comparable to those being developed by the Corporation; or that the drug substances used in the clinical trials have not been manufactured, under “current good manufacturing practices”, when required, in the United States, Canada and other jurisdictions in which such clinical trials have been and are being conducted. No filing or submission to the FDA, HC, the EMA or any other regulatory body, that was or is intended to be the basis for any approval of the Corporation’s products or product candidates, to the knowledge of the Corporation, contains any material omission or material false information. The Corporation is not in violation of any material law, order, rule, regulation, writ, injunction or decree of any court or governmental agency or body, applicable to the investigation of new drugs in humans and animals, including, but not limited to, those promulgated by the FDA, HC or the EMA;
|
(pp)
|
the descriptions in the Public Record of the results of the clinical trials referred to therein are consistent in all material respects with such results and no other studies or other clinical trials whose results are known to the Corporation are materially inconsistent with or otherwise materially call into question the results described or referred to in the Public Record. To the Corporation’s knowledge, the studies, tests and preclinical and clinical trials conducted by or on behalf of the Corporation were and, if still pending, are, in all material respects, being conducted in accordance with experimental protocols, procedures and controls pursuant to accepted professional scientific standards and all applicable laws and authorizations;
|
(qq)
|
the Corporation possesses such valid and current certificates, authorizations or permits issued by the appropriate federal, provincial, state, local or foreign regulatory agencies or bodies necessary to conduct its business, except where the failure to possess such certificates, authorizations or permits would not, individually or in the aggregate, result in a Material Adverse Change, and the Corporation has not received, nor has any reason to believe that it will receive, any notice of proceedings relating to the revocation or modification of, or non—compliance with, any such certificate, authorization or permit which, singly or in the aggregate, if the subject of an unfavourable decision, ruling or finding, could result in a Material Adverse Change;
|
(rr)
|
neither the Corporation or, to the best of its knowledge, any employee or agent thereof, has made any unlawful contribution or other payment to any official of, or candidate for, any federal, state, provincial or foreign office, or failed to disclose fully any contribution, in violation of any law, or made any payment to any foreign, Canadian, governmental officer or official, or other Person charged with similar public or quasi-public duties, other than payments required or permitted by applicable laws;
|
(ss)
|
there are no environmental audits, evaluations, assessments, studies or tests relating to the Corporation except for ongoing assessments conducted by or on behalf of the Corporation in the ordinary course;
|
(tt)
|
each material plan for retirement, bonus, stock purchase, profit sharing, stock option, deferred compensation, severance or termination pay, insurance, medical, hospital, dental, vision care, drug, sick leave, disability, salary continuation, legal benefits, unemployment benefits, vacation, incentive or otherwise contributed to or required to be contributed to, by the Corporation for the benefit of any current or former director, officer, employee or consultant of the Corporation (the “Employee Plans”) has been maintained in compliance with its terms and with the requirements prescribed by any and all statutes, orders, rules and regulations that are applicable to such Employee Plans, in each case in all material respects and has been publicly disclosed to the extent required by Applicable Securities Laws;
|
(uu)
|
all material accruals for unpaid vacation pay, premiums for employment insurance, health premiums, federal or state pension plan premiums, accrued wages, salaries and commissions and employee benefit plan payments have been reflected in the books and records of the Corporation;
|
(vv)
|
there has never been, there is not currently and the Corporation does not anticipate any labour disruption with respect to the employees or consultants of the Corporation which is adversely affecting or could adversely affect the carrying on of the business of the Corporation;
|
(ww)
|
the minute books of the Corporation made available to the Agents contain copies of all constating documents and all proceedings of security holders and directors (and committees thereof) and are complete in all material respects;
|
(xx)
|
the Corporation is not aware of any circumstances presently existing under which liability is or could reasonably be expected to be incurred under Part XXIII.1 – Civil Liability for Secondary Market Disclosure of the Securities Act (Ontario) or analogous securities laws in the other Qualifying Jurisdictions;
|
(yy)
|
other than the Agents, there is no person acting or purporting to act at the request or on behalf of the Corporation that is entitled to any brokerage or finder’s fee in connection with the transactions contemplated by this Agency Agreement;
|
(zz)
|
the Corporation will use the proceeds from the Offering for acquisitions and working capital; and
|
(aaa)
|
the Corporation has complied and will comply with the representation, warranties and covenants applicable to it in Schedule “A” and Schedule “A” is true and correct in all material respects.
|
5.
|
Agents’ Fee
|
Dundee Securities Ltd.
|
40 | % | ||
Kes 7 Capital Inc.
|
30 | % | ||
Bloom Burton & Co. Ltd.
|
30 | % | ||
|
100 | % |
6.
|
Closing
|
(a)
|
the opinions, certificates and agreements referred to in Section 9 and all other documents required to be provided by the Corporation to the Agents pursuant to this Agreement and the Subscription Agreements;
|
(b)
|
except for any Offered Shares offered or sold in the United States which shall be represented by individual definitive share certificates, one or more definitive share certificate(s)/and or book-entry only securities, duly registered as the Lead Agent may direct the Corporation;
|
(c)
|
the Corporation’s receipt for payment by the Agents of an amount equal to the aggregate purchase price for the Offered Shares sold pursuant to the Offering; and
|
(d)
|
such further documentation as may be contemplated by this Agreement or as Agents’ Counsel or the applicable regulatory authorities may reasonably require;
|
(e)
|
all duly completed Subscription Agreements tendered by the Subscribers for the Offered Shares being issued and sold and, where applicable, all completed forms, schedules and certificates contemplated by such Subscription Agreements;
|
(f)
|
a wire transfer of immediately available funds in an amount equal to the aggregate purchase price for the Offered Shares sold pursuant to the Offering, less an amount equal to the Agents’ Fee and the costs and expenses of the Agent provided for in Section 14; and
|
(g)
|
7.
|
Delivery of Offered Shares
|
8.
|
Agency Basis
|
9.
|
Conditions to Closing
|
(a)
|
Delivery of Opinions
|
(i)
|
The Agents shall have received at the Closing Time a legal opinion dated the Closing Date, in form and substance satisfactory to the Agents, acting reasonably, addressed to the Agents (and, if required for opinion purposes, counsel to the Agents) from Corporation’s Counsel as to the laws of Canada and the Selling Jurisdictions in Canada, which counsel in turn may rely upon the opinions of local counsel where it deems such reliance proper as to the laws other than those of Canada and such provinces in Canada where Corporation’s Counsel is licensed to practice law (or alternatively make arrangements to have such opinions directly addressed to the Agents) and as to matters of fact, on certificates of Governmental Authorities and officers of the Corporation and letters from stock exchange representatives and transfer agents, with respect to customary corporate, securities law and other matters requested by the Agents.
|
(ii)
|
The Agents shall have received at the Closing Time an opinion of U.S. counsel to the Corporation, Troutman Sanders LLP, in form and substance satisfactory to the Agents, acting reasonably, to the effect that the offer and sale of the Offered Shares in the United States do not require registration under the U.S. Securities Act.
|
(iii)
|
The Agents having received at the Closing Time such further opinions, certificates and other documentation from the Corporation as may be contemplated herein or as the Agents may reasonably require, provided, however, that the Agents shall request any such opinion, certificate or document within a reasonable period prior to the Closing Time that is sufficient for the Corporation to obtain and deliver such certificate or document.
|
(b)
|
Delivery of Certificates
|
(i)
|
The Agents shall have received at the Closing Time a certificate dated the Closing Date, addressed to the Agents (and, if necessary for opinion purposes, counsel to the Agents) and signed by officers of the Corporation acceptable to the Agents, acting reasonably, with respect to the constating documents of the Corporation, no proceedings to voluntarily wind-up or dissolve, all resolutions of the board of directors of the Corporation relating to this Agreement and the transactions contemplated by this Agreement and the incumbency and specimen signatures of signing officers of the Corporation and such other matters as the Agents may reasonably request.
|
(ii)
|
The Agents shall have received at the Closing Time a certificate of good standing of the Corporation.
|
(iii)
|
The Agents shall have received at the Closing Time a certificate dated the Closing Date, addressed to the Agents and counsel to the Agents and signed on behalf of the Corporation by the Chief Executive Officer and the Chief Financial Officer or other officers of the Corporation acceptable to the Agents, certifying for and on behalf of the Corporation and without personal liability, after having made due enquiry:
|
(A)
|
the Corporation has complied with and satisfied all terms and conditions of this Agreement and the Subscription Agreements on its part to be complied with or satisfied at or prior to the Closing Time;
|
(B)
|
the representations and warranties of the Corporation contained in this Agreement and the Subscription Agreements are true and correct at the Closing Time with the same force and effect as if made at and as of the Closing Time after giving effect to the transactions contemplated by this Agreement;
|
(C)
|
the responses provided by the Corporation at the Due Diligence Session are true and correct and would not be different in any material respect if the Due Diligence Session were held immediately prior to the Closing Time;
|
(D)
|
the Corporation has made and/or obtained, on or prior to the Closing Time, all necessary filings, approvals, consents and acceptances of applicable regulatory authorities and under any applicable agreement or document to which the Corporation is a party or by which it is bound, required for the execution and delivery of this Agreement, the offering and sale of the Offered Shares in the Selling Jurisdictions in Canada and the consummation of the other transactions contemplated hereby (subject to completion of filings with certain regulatory authorities following the Closing Date);
|
(E)
|
no order, ruling or determination having the effect of suspending the sale of or cease trading the Offered Shares or any other securities of the Corporation has been issued by any regulatory authority and is continuing in effect and no proceedings for that purpose have been instituted or are pending or, to the knowledge of such officer of the Corporation, contemplated or threatened under any Applicable Securities Laws or by any other regulatory authority; and
|
(F)
|
such other matters as may be reasonably requested by the Agents or the Agents’ Counsel.
|
(c)
|
Exchange Approval
|
(d)
|
Consents
|
10.
|
Rights of Termination
|
(a)
|
Regulatory Proceedings Out
|
(b)
|
Disaster Out
|
(c)
|
Material Change or Change in Material Fact Out
|
(d)
|
Non-Compliance with Conditions
|
(e)
|
Exercise of Termination Rights
|
11.
|
Indemnity
|
(a)
|
Rights of Indemnity
|
|
(a)
|
any information or statement contained in this Agreement, the Corporation’s publicly available disclosed documents filed on SEDAR or elsewhere, or in any other material prepared by the Corporation used for marketing the Offering or any certificate of the Corporation delivered hereunder or pursuant hereto, which at the time and in the light of the circumstances under which it was made contains or is alleged to contain a misrepresentation or any misstatement of a material fact;
|
|
(b)
|
the omission or alleged omission to state in in this Agreement, the Corporation’s publicly available disclosed documents filed on SEDAR or elsewhere, or in any other material prepared by the Corporation used for marketing the Offering or any certificate of the Corporation delivered hereunder or pursuant hereto, any material fact required to be stated therein or necessary to make any statement therein not misleading in light of the circumstances in which it was made;
|
|
(c)
|
any order made, or inquiry, investigation or proceeding commenced by any securities regulatory authority or other competent authority based upon any misrepresentation, untrue statement or omission or alleged untrue statement or omission in this Agreement, the Corporation’s publicly available disclosed documents filed on SEDAR or elsewhere, or in any other material prepared by the Corporation used for marketing the Offering or any certificate of the Corporation delivered hereunder or pursuant hereto that prevents or restricts the trading in any of the Corporation’s securities or the distribution or distribution to the public, as the case may be, of any of the Offered Shares in any of the Qualifying Jurisdictions;
|
|
(d)
|
the Corporation not complying with any requirement of Applicable Securities Laws or stock exchange requirements in connection with the transactions contemplated herein, including the Corporation’s non-compliance with any statutory requirement to make any document available for inspection; or
|
|
(e)
|
any breach of a representation or warranty of the Corporation contained in this Agreement or the failure of the Corporation to comply with any of its obligations hereunder.
|
(b)
|
Notification of Claims
|
(i)
|
the defence shall be conducted through legal counsel acceptable to the Indemnified Party, acting reasonably, and
|
(ii)
|
no settlement of any such Claim or admission of liability may be made by the Corporation without the prior written consent of the Indemnified Party, acting reasonably, unless such settlement includes an unconditional release of the Indemnified Party from all liability arising out of such action or claim and does not include a statement as to or an admission of fault, culpability or failure to act, by or on behalf of any Indemnified Party.
|
(c)
|
Right of Indemnity in Favour of Others
|
(d)
|
Retaining Counsel
|
12.
|
Contribution
|
(a)
|
Rights of Contribution
|
(b)
|
Rights of Contribution in Addition to Other Rights
|
(c)
|
Right of Contribution in Favour of Others
|
(d)
|
Remedy Not Exclusive
|
13.
|
Severability
|
14.
|
Expenses
|
(a)
|
Whether or not the transactions contemplated by this Agreement shall be completed, all expenses of or incidental to the issue, sale and delivery of the Offered Shares and all expenses of or incidental to all other matters in connection with the offering of the Offered Shares shall be borne by the Corporation including, without limitation, all fees and disbursements of all legal counsel to the Corporation (including U.S., foreign and local counsel), all fees and disbursements of the Corporation’s accountants and auditors, all expenses related to road shows and marketing activities, all printing costs incurred in connection with the offering of the Offered Shares, including certificates, if any, representing the Offered Shares, all filing fees, all fees and expenses relating to listing the Offered Shares on any exchanges, all transfer agent fees and expenses, and all reasonable out-of-pocket expenses of the Agents incurred in connection with the offering of the Offered Shares, including without limitation the fees of Canadian counsel to the Agents which shall not exceed $50,000 (not including applicable taxes and disbursements and $10,000 USD plus tax and disbursements for U.S. Counsel), and any advertising, printing, courier, telecommunications, data search, presentation, travel and other expenses incurred by the Agents together with all related taxes (including, without limitation, provincial sales taxes and HST).
|
(b)
|
All expenses payable by the Corporation to the Agent in accordance with this Agreement shall be payable whether or not the Offering is completed.
|
15.
|
Survival of Representations and Warranties
|
16.
|
Entire Agreement
|
17.
|
Amendment
|
18.
|
Assignment and Enurement
|
19.
|
Time
|
20.
|
Governing Law
|
21.
|
Notice
|
|
to the Agents at:
|
22.
|
Authority of the Lead Agent
|
23.
|
Agents as Trustee
|
24.
|
Counterparts
|
DUNDEE SECURITIES LTD.
|
|
By:
|
/s/ Aaron Unger_____________________________ |
Name: Aaron Unger
|
|
Title: Managing Director
|
KES 7 CAPITAL INC.
|
|
By:
|
/s/ Mark Christensen______________________________ |
Name: Mark Christensen
|
|
Title: President and CEO
|
BLOOM BURTON & CO. LTD.
|
|
By:
|
/s/ Jolyon Burton______________________________ |
Name: Jolyon Burton
|
|
Title: CEO
|
TRIBUTE PHARMACEUTICALS INC.
|
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By:
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/s/ Rob Harris_______________________________ |
Name: Rob Harris
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Title: President and CEO
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(a)
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“Accredited Investors” means institutions that are “accredited investors” meeting the criteria set forth in Rule 501(a) of Regulation D;
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(b)
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“Directed Selling Efforts” means “directed selling efforts” as that term is defined in Rule 902(c) of Regulation S, which, without limiting the foregoing, but for greater clarity in this Schedule, includes, subject to the exclusions from the definition of directed selling efforts contained in Regulation S, any activity undertaken for the purpose of, or that could reasonably be expected to have the effect of, conditioning the market in the United States for any of the Offered Shares and includes the placement of any advertisement in a publication with a general circulation in the United States that refers to the offering of the Offered Shares;
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(c)
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“Foreign Issuer” means “foreign issuer” as that term is defined in Rule 902(e) of Regulation S;
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(d)
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“General Solicitation” and “General Advertising” means “general solicitation” and “general advertising”, respectively, as used in Rule 502(c) of Regulation D, including advertisements, articles, notices or other communications published in any newspaper, magazine or similar media or the internet or broadcast over radio or television or the internet, or any seminar or meeting whose attendees had been invited by general solicitation or general advertising;
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(e)
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“Offshore Transaction” means an “offshore transaction” as that term is defined in Rule 902(h) of Regulation S;
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(f)
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“Regulation D” means Regulation D adopted by the SEC under the U.S. Securities Act;
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(g)
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“Regulation S” means Regulation S adopted by the SEC under the U.S. Securities Act;
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(h)
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“SEC” means the United States Securities and Exchange Commission;
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(i)
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“Substantial U.S. Market Interest” means “substantial U.S. market interest” as that term is defined in Rule 902(j) of Regulation S;
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(j)
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“U.S. Affiliate” of any Lead Agent means the U.S. registered broker-dealer affiliate of the Lead Agent;
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(k)
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“U.S. Exchange Act” means the United States Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder; and
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(l)
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“U.S. Subscriber” means a Subscriber located in the United States, who was offered Offered Shares in the United States, who originated their purchase at or from the United States or who executes a Subscription Agreement while in the United States.
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1.
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The Corporation is a Foreign Issuer and reasonably believes that there is no Substantial U.S. Market Interest with respect to the common shares of the Corporation.
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2.
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The Corporation is not, and after giving effect to the Offering and the application of the proceeds as contemplated hereby, will not be, required to register as an “investment company” as such term is defined under the United States Investment Corporation Act of 1940, as amended.
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3.
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Except with respect to offers and sales to Accredited Investors identified by the Agents in reliance upon Regulation D, none of the Corporation, its affiliates, or any person acting on any of their behalf (other than the Agents, the U.S. Affiliates, any members of the banking and selling group formed by them, or any person acting on any of their behalf, as to whom the Corporation makes no representation, warranty, covenant or acknowledgment), has made or will make: (A) any offer to sell, or any solicitation of an offer to buy, any Offered Shares to a person in the United States; or (B) any sale of Offered Shares unless, at the time the buy order was or will have been originated, the Subscriber is (i) outside the United States, or (ii) the Corporation, its affiliates, and any person acting on any of their behalf reasonably believe that the Subscriber is outside the United States.
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4.
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None of the Corporation, its affiliates, or any person acting on any of their behalf (other than the Agents, the U.S. Affiliates, any members of the banking and selling group formed by them, or any person acting on any of their behalf, as to whom the Corporation makes no representation, warranty, covenant or acknowledgment), has engaged or will engage in any Directed Selling Efforts, or has taken or will take any action that would cause the registration exemption and exclusion afforded by Rule 506(b) of Regulation D or Rule 903 of Regulation S, respectively, to be unavailable for offers and sales of the Offered Shares pursuant to this Agreement.
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5.
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None of the Corporation, any of its affiliates or any person acting on any of their behalf (other than the Agents, the U.S. Affiliates, or any members of the banking and selling group formed by them, or any person acting on any of their behalf, as to whom the Corporation makes no representation, warranty, covenant or acknowledgment) has offered or will offer to sell, or has solicited or will solicit offers to buy, any of the Offered Shares in the United States by means of any form of General Solicitation or General Advertising or in any manner involving a public offering within the meaning of Section 4(a)(2) of the U.S. Securities Act.
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6.
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For the period commencing six months prior to the date hereof and ending six months following the completion of the Offering, none of the Corporation, its affiliates, or any person acting on any of their behalf (other than the Agents, the U.S. Affiliates, or any members of the banking and selling group formed by them, or any person acting on any of their behalf, as to whom the Corporation makes no representation, warranty, covenant or acknowledgment) has sold, offered for sale or solicited any offer to buy or will sell, offer to sell or solicit any offer to buy any of the Corporation’s securities in a manner that would be integrated with the offer and sale of the Offered Shares and would cause the exemption from registration afforded by Rule 506(b) of Regulation D to become unavailable with respect to the offer and sale of the Offered Shares.
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7.
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Neither the Corporation nor any of its predecessors or affiliates has been subject to any order, judgment, or decree of any court of competent jurisdiction temporarily, preliminarily or permanently enjoining such person for failure to comply with Rule 503 of Regulation D.
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8.
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None of the Corporation, its affiliates or any person on any of their behalf (other than the Agents, the U.S. Affiliates, or any members of the banking and selling group formed by them, or any person acting on any of their behalf, as to whom the Corporation makes no representation, warranty, covenant or acknowledgment) has taken or will take any action that would constitute a violation of Regulation M under the U.S. Exchange Act in connection with the Offering.
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9.
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The Corporation will cause a Form D to be filed with the SEC within 15 days of the first sale of the Offered Shares to a U.S. Subscriber, and will, within the prescribed time periods, prepare and file any other forms or notices required under any state securities laws in connection with the offer and sale of Offered Shares.
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10.
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With respect to Offered Shares to be offered and sold in reliance on Rule 506(b) of Regulation D, none of the Corporation, any of its predecessors, any affiliated issuer, any director, executive officer, other officer of the Corporation participating in the Offering, any beneficial owner of 20% or more of the Corporation’s outstanding voting equity securities, calculated on the basis of voting power, or any promoter (as that term is defined in Rule 405 under the U.S. Securities Act) connected with the Corporation in any capacity at the time of sale (each, an "Issuer Covered Person" and, together, "Issuer Covered Persons") is subject to any of the "Bad Actor" disqualifications described in Rule 506(d)(1)(i) to (viii) of Regulation D (a "Disqualification Event"), except for a Disqualification Event covered by Rule 506(d)(2) or (d)(3) of Regulation D. The Corporation has exercised reasonable care to determine whether any Issuer Covered Person is subject to a Disqualification Event. The Corporation has complied, to the extent applicable, with its disclosure obligations under Rule 506(e) of Regulation D, and has furnished to the Agents a copy of any disclosures provided thereunder.
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11.
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The Corporation is not aware of any person (other than any Dealer Covered Person) that has been or will be paid (directly or indirectly) remuneration for solicitation of Subscribers in connection with the sale of any Offered Shares pursuant to Rule 506(b) of Regulation D.
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12.
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The Corporation will notify the Agents, in writing, prior to the Closing Date of (i) any Disqualification Event relating to any Issuer Covered Person and (ii) any event that would, with the passage of time, become a Disqualification Event relating to any Issuer Covered Person.
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1.
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The Offered Shares have not been and will not be registered under the U.S. Securities Act or any state securities laws and may be offered and sold only in transactions exempt from or not subject to the registration requirements of the U.S. Securities Act and applicable state securities laws. It has not offered and sold, and will not offer and sell, any Offered Shares except: (a), in case of all Agents, offers and sales in Offshore Transactions in accordance with Rule 903 of Regulation S; or (b), in the case of the Lead Agent, offers in the United States to Accredited Investors as permitted by this Agreement. Accordingly, none of the Agent, its affiliates or any persons acting on any of their behalf, has made or will make (except as permitted in this Agreement): (i) any offer to sell, or any solicitation of an offer to buy, any Offered Shares to any person in the United States; (ii) any sale of Offered Shares to any Subscriber unless, at the time the buy order was or will have been originated, the Subscriber was outside the United States, or such Agent, affiliate or person acting on any of their behalf reasonably believed that such Subscriber was outside the United States.
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2.
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It has not entered and will not enter into any contractual arrangement with respect to the offer and sale of the Offered Shares, except with its U.S. Affiliate, any selling group members or with the prior written consent of the Corporation. It shall require its U.S. Affiliate and each selling group member to agree, for the benefit of the Corporation, to comply with, and shall use its reasonable best efforts to ensure that its U.S. Affiliate and each selling group member complies with, the provisions of this Schedule applicable to the Agent as if such provisions applied to such U.S. Affiliate and such selling group members.
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3.
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All offers of Offered Shares in the United States shall be made only by the Lead Agent through its U.S. Affiliate, which on the dates of such offers and subsequent sales by the Corporation was and will be duly registered as a broker-dealer under the U.S. Exchange Act and under all applicable state securities laws (unless exempt from the registration requirements thereof) and a member of, and in good standing with, the Financial Industry Regulatory Authority, Inc. The U.S. Affiliate will make all offers and arrange for all sales by the Corporation of Offered Shares in compliance with all applicable United States federal and state broker-dealer requirements and this Schedule.
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4.
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None of the Agent, its affiliates, or any person acting on behalf of any of them, have engaged in any Directed Selling Efforts or have solicited or will solicit offers to buy, or have offered to sell or will offer to sell, any of the Offered Shares in the United States by any form of General Solicitation or General Advertising or in any manner involving a public offering within the meaning of Section 4(a)(2) of the U.S. Securities Act.
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5.
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Any offer to sell or solicitation of an offer to buy Offered Shares that has been made or will be made in the United States by the Lead Agent through the U.S. Affiliate was or will be made only to Accredited Investors in transaction that in compliance with Rule 506(b) of Regulation D and to be exempt from registration under and in compliance with applicable state securities laws.
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6.
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Immediately prior to soliciting any U.S. Subscriber, the Lead Agent, its U.S. Affiliate, their respective affiliates, and any person acting on behalf of any of them, had reasonable grounds to believe and did believe that each such U.S. Subscriber was an Accredited Investor, based upon a pre-existing relationship, and at the time of completion of each sale by the Corporation to such U.S. Subscriber, the Lead Agent, its U.S. Affiliate, their respective affiliates, and any person acting on behalf of any of them will have reasonable grounds to believe and will believe, that each U.S. Subscriber designated by the Lead Agent or its U.S. Affiliate to purchase Offered Shares from the Corporation is an Accredited Investor.
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7.
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Prior to arranging for any sale by the Corporation of Offered Shares to U.S. Subscribers, the Lead Agent shall cause each such U.S. Subscriber to duly complete and execute a Subscription Agreement to be used for U.S. Subscribers.
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8.
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At least one business day prior to the Closing Date, the transfer agent for the Corporation will be provided with a list of all U.S. Subscribers.
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9.
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At the Closing Time, the Lead Agent, together with its U.S. Affiliate, will provide a certificate, substantially in the form of Exhibit I to this Schedule A relating to the manner of the offer of the Offered Shares in the United States or will be deemed to have represented and warranted to the Corporation that neither it nor its U.S. Affiliate has offered or sold Offered Shares in the United States.
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10.
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Prior to arranging any sale by the Corporation of Offered Shares to a U.S. Subscriber, each such person will be informed that the Offered Shares have not been and will not be registered under the U.S. Securities Act or any state securities laws and are being offered and sold to such U.S. Subscriber in reliance on an exemption from the registration requirements of the U.S. Securities Act provided by Rule 506(b) of Regulation D and similar exemptions under applicable state securities laws.
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11.
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None of the Agent, the U.S. Affiliate, or any person acting on its or their behalf has taken or will take any action in violation of Regulation M under the U.S. Exchange Act in connection with the Offering.
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12.
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Other than Lead Agent and the U.S. Affiliate, it has not made and will not make any offers or sales of Offered Shares in the United States in connection with the Offering.
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13.
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The Lead Agent represents and warrants that with respect to Offered Shares to be sold in reliance on Rule 506(b) of Regulation D, none of it, or the U.S. Affiliate, or any of its or the U.S. Affiliate’s directors, executive officers, general partners, managing members or other officers participating in the Offering, or any other person associated with the Lead Agent who will receive, directly or indirectly, remuneration for solicitation of Subscribers of Offered Shares pursuant to Rule 506(b) of Regulation D (each, a "Dealer Covered Person" and, together, "Dealer Covered Persons"), is subject to any Disqualification Event (as defined below) except for a Disqualification Event (i) covered by Rule 506(d)(2)(i) of Regulation D and (ii) a description of which has been furnished in writing to the Corporation prior to the date hereof or, in the case of a Disqualification Event occurring after the date hereof, prior to the Closing Date.
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14.
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The Lead Agent represents that it is not aware of any person (other than any Dealer Covered Person) that has been or will be paid (directly or indirectly) remuneration for solicitation of Subscribers in connection with the sale of any Offered Shares pursuant to Rule 506(b) of Regulation D. It will notify the Corporation, prior to the Closing Date of any agreement entered into between it and any such person in connection with such sale.
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15.
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The Lead Agent will notify the Corporation, in writing, prior to the Closing Date, of (i) any Disqualification Event relating to any Dealer Covered Person not previously disclosed to the Corporation in accordance herewith, and (ii) any event that would, with the passage of time, become a Disqualification Event relating to any Dealer Covered Person.
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(i)
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on the date hereof and on the date of each offer of Securities by us in the United States and each subsequent sale to such offerees by the Corporation, the U.S. Affiliate is and was: (A) a duly registered as a broker-dealer under the U.S. Exchange Act and duly registered as a broker-dealer under the laws of each state where it made offers of Securities (unless exempt from such registration requirements); and (B) a member of and in good standing with the Financial Industry Regulatory Authority, Inc.;
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(ii)
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all offers of Securities by us in the United States have been effected by the U.S. Affiliate in accordance with all applicable U.S. federal and state broker-dealer requirements;
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(iii)
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immediately prior to offering the Securities to persons in the United States, we had reasonable grounds to believe and did believe that each such person was an Accredited Investor, based upon a pre-existing relationship, and, on the date hereof, we continue to believe that each such offeree purchasing Securities from the Corporation is an Accredited Investor;
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(iv)
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no form of Directed Selling Efforts, General Solicitation or General Advertising was used by us in connection with the offer of the Securities by us in the United States, and we have not acted in any manner involving public offering within the meaning of Section 4(a)(2) of the U.S. Securities Act in connection with the offer of the Securities by us in the United States;
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(v)
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in connection with arranging each sale by the Corporation of Securities to U.S. Subscribers solicited by us, we caused each such U.S. Subscriber to duly complete and execute a Subscription Agreement to be used for U.S Subscribers;
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(vi)
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the Agent represents and warrants that with respect to Offered Shares to be sold in reliance on Rule 506(b) of Regulation D, none of it, the U.S. Affiliate, any of its or the U.S. Affiliate’s directors, executive officers, general partners, managing members or other officers participating in the Offering, or any other person associated with the Agent who will receive, directly or indirectly, remuneration for solicitation of Subscribers of Offered Shares pursuant to Rule 506(b) of Regulation D (each, a "Dealer Covered Person" and, together, "Dealer Covered Persons"), is subject to any Disqualification Event except for a Disqualification Event (i) covered by Rule 506(d)(2)(i) of Regulation D and (ii) a description of which has been furnished in writing to the Corporation prior to the date hereof;
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(vii)
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the Agent represents that it is not aware of any person (other than any Dealer Covered Person) that has been or will be paid (directly or indirectly) remuneration for solicitation of Subscribers in connection with the sale of any Offered Shares pursuant to Rule 506(b) of Regulation D; and
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(viii)
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the offering of the Securities in the United States has been conducted by us in accordance with the terms of the Agency Agreement, including Schedule A attached hereto.
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[INSERT NAME OF AGENT]
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[INSERT NAME OF U.S. AFFILIATE]
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By:
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_______________________________________ |
By:
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____________________________________ | |
Name:
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Name:
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Title:
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Title:
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Press Release
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Source: Tribute Pharmaceuticals Canada Inc.
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● William Maichle Hired as President of U.S. Operations
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