UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): June 25, 2018
(Exact name of registrant as specified in its charter)
Nevada
(State or Other Jurisdiction of Incorporation)
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001-36908 |
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98-0138393 |
(Commission File Number) |
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(IRS Employer Identification No.) |
665 Anderson Street
Winnemucca, Nevada
89445
(Address of Principal Executive Offices)
(775) 625-3600
(Registrant’s telephone number, including area code)
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instructions A.2. below):
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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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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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2). Emerging growth company ☒
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 1.01 Entry in a Material Definitive Agreement.
On June 25 , 2018, Paramount Gold Nevada Corp. (“Paramount”, “we”, or the “Company”) accepted subscriptions (the “Subscription Agreements”) from investors to purchase common stock and warrants (the “Warrants”) in the private placement described under Item 3.02 below. The disclosure set forth in Item 3.02 of this Current Report is incorporated by reference into this Item 1.01.
The forms of the Subscription Agreement and Warrant are filed as Exhibits 10.1 and 4.1 respectively, to this Current Report on Form 8-K. The summaries of the terms of these documents contained herein are subject to, and qualified in their entirety by, such documents, which are incorporated herein by reference.
Item 3.02Unregistered Sales of Equity Securities.
On June 25, 2018, the Company entered into definitive agreements with accredited investors to issue common stock and warrants in a private transaction (the “Transaction”). Under the terms of the Transaction, Paramount has sold an aggregate of 2,400,000 units at $1.25 per unit for aggregate proceeds of $3,000,000. Each unit consists of one share of common stock and one warrant to purchase one-half of a share of common stock. Each warrant will have a two-year term and will be exercisable at the following exercise prices: in the first year at $1.30 per share and in the second year at $1.50 per share. The Transaction is expect to close on July 6, 2018, subject to customary closing conditions.
Based in part upon the representations of the investors set forth in the Subscription Agreements, the common stock and warrants will be issued pursuant to the exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933, as amended, as an issuance not involving a public offering.
Item 7.01. Regulation FD Disclosure.
On June 25, 2018, the Company issued a press release regarding the transactions described above under Item 1.01 and Item 3.02 of this Current Report on Form 8-K. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.
The information in this Item 7.01 of this Current Report on Form 8-K, including Exhibit 99.1 attached hereto, shall not be deemed “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.
Item 9.01.Financial Statements and Exhibits.
(d)List of Exhibits
Exhibit Number |
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Description |
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Exhibit 4.1* |
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Exhibit 10.1* |
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Exhibit 99.1* |
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Filed herewith. |
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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PARAMOUNT GOLD NEVADA CORP. |
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Date: June 28, 2018 |
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By: |
/s/ Carlo Buffone |
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Carlo Buffone |
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Chief Financial Officer |
Exhibit 4.1
PARAMOUNT GOLD NEVADA CORP.
FORM OF WARRANT
Warrant No. _____ |
Original Issue Date: July___, 2018 (“Original Issue Date”) |
PARAMOUNT GOLD NEVADA CORP., a Nevada corporation (the “Company”), hereby certifies that, for value received, _________ or its permitted registered assigns (the “Holder”), is entitled to purchase from the Company up to a total of _________ shares of common stock, $0.01 par value (the “Common Stock”) of the Company (each such share, a “Warrant Share” and all such shares, the “Warrant Shares”) at the Exercise Price (defined below) at any time and from time to time on or after the Original Issue Date and through and including 5:00 P.M., New York City time, on July ___, 2020 (the “Expiration Date”), and subject to the following terms and conditions:
All such warrants are referred to herein, collectively, as the “Warrants.” The Company has agreed to use its best efforts to cause the issuance of the Warrant Shares to be registered pursuant to a Registration Statement on Form S-3 (together with any registration statement filed by the Company pursuant to Rule 462(b) under the Securities Act, the “Registration Statement”).
1. Definitions.
“Affiliate” of a person means a person that, directly or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with, the person specified.
“Common Stock Deemed Outstanding” means, at any given time, the number of shares of Common Stock actually outstanding at such time, plus the number of shares of Common Stock deemed to be outstanding pursuant to Sections 9(e)(ii)(1) and 9(e)(ii)(2) hereof regardless of whether the Options or Convertible Securities are actually exercisable at such time, but excluding any shares of Common Stock owned or held by or for the account of the Company or issuable upon exercise of the Warrants.
“Convertible Securities” means any stock or securities (other than Options) directly or indirectly convertible into or exercisable or exchangeable for shares of Common Stock.
“Exercise Price” means (i) during the period commencing on the Original Issue Date to and including July __, 2019 an amount equal to $1.30 per share; and (ii) during the period commencing on July __, 2019 to and including the Expiration Date, an amount equal to $1.50 per share (in each case, as adjusted from time to time as provided herein).
“Market Price” means the last sale price of the Common Stock on the Trading Market on the Trading Day immediately preceding the issuance by the Company of Common Stock or Convertible Securities.
“Options” means any rights, warrants or options to subscribe for or purchase shares of Common Stock or Convertible Securities.
“Person” means an individual, a limited liability company, a partnership, a joint venture, a corporation, a trust, an unincorporated organization and a government or any department or agency thereof.
“Trading Day” means any day on which trading of the Common Stock occurs on the applicable Trading Market.
“Trading Market” means the NYSE American or, if the Company’s Common Stock is not then listed on the NYSE American, then such exchange or quotation system on which the Common Stock then primarily trades.
2. List of Warrant Holders. The Company shall register this Warrant, upon records to be maintained by the Company for that purpose (the “Warrant Register”), in the name of the record Holder (which shall include the initial Holder or, as the case may be, any registered assignee to which this Warrant is permissibly assigned hereunder from time to time). The Company may deem and treat the registered Holder of this Warrant as the absolute owner hereof for the purpose of any exercise hereof or any distribution to the Holder, and for all other purposes, absent actual notice to the contrary.
3. List of Transfers; Restrictions on Transfer.
(a) This Warrant and the Warrant Shares are subject to the restrictions on transfer set forth in this Section 3.
(b) The Company shall register any such transfer of all or any portion of this Warrant in the Warrant Register, upon surrender of this Warrant, with the Form of Assignment attached hereto duly completed and signed, to the Company at its address specified herein. Upon any such registration or transfer, a new Warrant to purchase Common Stock, in substantially the form of this Warrant (any such new Warrant, a “New Warrant”), evidencing the portion of this Warrant so transferred shall be issued to the transferee and a New Warrant evidencing the remaining portion of this Warrant not so transferred, if any, shall be issued to the transferring Holder. The acceptance of the New Warrant by the transferee thereof shall be deemed the acceptance by such transferee of all of the rights and obligations in respect of the New Warrant that the Holder has in respect of this Warrant.
4. Exercise and Duration of Warrants.
(a) All or any part of this Warrant shall be exercisable by the registered Holder in any manner permitted by Section 10 hereof at any time and from time to time on or after the Original Issue Date and through and including the Expiration Date. Subject to Section 11 hereof, at 5:00 p.m., New York City time, on the Expiration Date, the portion of this Warrant not exercised prior thereto shall be and become void and of no value and this Warrant shall be terminated and no longer outstanding.
(b) The Holder may exercise this Warrant by delivering to the Company (i) an exercise notice, in the form attached hereto (the “Exercise Notice”), completed and duly signed, and (ii) payment of the Exercise Price for the number of Warrant Shares as to which this Warrant is being exercised. The date such items are delivered to the Company (as determined in accordance with the notice provisions hereof) is an “Exercise Date.” The Holder shall not be required to deliver the original Warrant in order to effect an exercise hereunder. Execution and delivery of the Exercise Notice shall have the same effect as cancellation of the original Warrant
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and issuance of a New Warrant evidencing the right to purchase the remaining number of Warrant Shares. On or before the first (1st) business day following the date on which the Company has received the Exercise Notice, the Company shall transmit to a facsimile number set forth in the Exercise Notice a confirmation of receipt of the Exercise Notice to the Holder and also will notify the Company’s transfer agent.
5. Delivery of Warrant Shares.
(a) Upon exercise of this Warrant, the Company shall promptly (but in no event later than three Trading Days after the Exercise Date) issue or cause to be issued and cause to be delivered to or upon the written order of the Holder and in such name or names as the Holder may designate (provided that, if the Registration Statement is not then effective and the Holder directs the Company to deliver a certificate for the Warrant Shares in a name other than that of the Holder or an Affiliate of the Holder, it shall deliver to the Company on the Exercise Date an opinion of counsel reasonably satisfactory to the Company to the effect that the issuance of such Warrant Shares in such other name may be made pursuant to an available exemption from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”) and all applicable state securities or blue sky laws), a certificate for the Warrant Shares issuable upon such exercise, free of restrictive legends unless the Registration Statement is not then effective or the Warrant Shares are not freely transferable without volume restrictions pursuant to Rule 144 under the Securities Act. The Holder, or any Person permissibly so designated by the Holder to receive Warrant Shares, shall be deemed to have become the holder of record of such Warrant Shares as of the Exercise Date. If the Warrant Shares can be issued without restrictive legends, the Company shall, upon the written request of the Holder, use its best efforts to deliver, or cause to be delivered, Warrant Shares hereunder electronically through the Depository Trust and Clearing Corporation (“DTC”) or another established clearing corporation performing similar functions, if available; provided, that, the Company may, but will not be required to, change its transfer agent if its current transfer agent cannot deliver Warrant Shares electronically through DTC.
(b) To the extent permitted by law, the Company’s obligations to issue and deliver Warrant Shares in accordance with the terms hereof are absolute and unconditional, irrespective of any action or inaction by the Holder to enforce the same, any waiver or consent with respect to any provision hereof, the recovery of any judgment against any Person or any action to enforce the same, or any setoff, counterclaim, recoupment, limitation or termination, or any breach or alleged breach by the Holder or any other Person of any obligation to the Company or any violation or alleged violation of law by the Holder or any other Person, and irrespective of any other circumstance that might otherwise limit such obligation of the Company to the Holder in connection with the issuance of Warrant Shares. Nothing herein shall limit a Holder’s right to pursue any other remedies available to it hereunder, at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief with respect to the Company’s failure to timely deliver certificates representing shares of Common Stock upon exercise of the Warrant as required pursuant to the terms hereof.
6. Charges, Taxes and Expenses. Issuance and delivery of certificates for shares of Common Stock upon exercise of this Warrant shall be made without charge to the Holder for any issue or transfer tax, withholding tax, transfer agent fee or other incidental tax or expense in respect of the issuance of such certificates, all of which taxes and expenses shall be paid by the Company; provided, however, that the Company shall not be required to pay any tax that may be payable in respect of any transfer involved in the registration of any certificates for Warrant Shares or Warrants in a name other than that of the Holder.
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The Holder shall be responsible for all other tax liability that may arise as a result of holding or transferring this Warrant or receiving Warrant Shares upon exercise hereof.
7. Replacement of Warrant. If this Warrant is mutilated, lost, stolen or destroyed, the Company shall issue or cause to be issued in exchange and substitution for and upon cancellation hereof, or in lieu of and substitution for this Warrant, a New Warrant, but only upon receipt of evidence reasonably satisfactory to the Company of such loss, theft or destruction and customary and reasonable indemnity (which shall not include a surety bond), if requested. Applicants for a New Warrant under such circumstances shall also comply with such other reasonable regulations and procedures and pay such other reasonable third-party costs as the Company may prescribe. If a New Warrant is requested as a result of a mutilation of this Warrant, then the Holder shall deliver such mutilated Warrant to the Company as a condition precedent to the Company’s obligation to issue the New Warrant.
8. Reservation of Warrant Shares; Listing. The Company covenants that it will at all times reserve and keep available out of the aggregate of its authorized but unissued and otherwise unreserved Common Stock, solely for the purpose of enabling it to issue Warrant Shares upon exercise of this Warrant as herein provided, the number of Warrant Shares that are then issuable and deliverable upon the exercise of this entire Warrant, free from preemptive rights or any other contingent purchase rights of persons other than the Holder (taking into account the adjustments and restrictions of Section 9 hereof). The Company covenants that all Warrant Shares so issuable and deliverable shall, upon issuance and the payment of the applicable Exercise Price in accordance with the terms hereof, be duly and validly authorized, issued and fully paid and nonassessable. The Company shall use its commercially reasonable efforts to cause the Warrant Shares to be listed for quotation on the NYSE American and to maintain such listing.
9. Certain Adjustments. The Exercise Price and number of Warrant Shares issuable upon exercise of this Warrant are subject to adjustment from time to time as set forth in this Section 9.
(a) Stock Dividends and Splits. If the Company, at any time while this Warrant is outstanding, (i) pays a stock dividend on its Common Stock or otherwise makes a distribution on any class of capital stock that is payable in shares of Common Stock, (ii) subdivides outstanding shares of Common Stock into a larger number of shares, or (iii) combines outstanding shares of Common Stock into a smaller number of shares, then in each such case the Exercise Price shall be multiplied by a fraction of which the numerator shall be the number of shares of Common Stock outstanding immediately before such event and of which the denominator shall be the number of shares of Common Stock outstanding immediately after such event. Any adjustment made pursuant to clause (i) of this paragraph shall become effective immediately after the record date for the determination of stockholders entitled to receive such dividend or distribution, and any adjustment pursuant to clause (ii) or (iii) of this paragraph shall become effective immediately after the effective date of such subdivision or combination.
(b) Pro Rata Distributions. If the Company, at any time while this Warrant is outstanding, distributes to all holders of Common Stock for no consideration (i) evidences of its indebtedness, (ii) any security (other than a distribution of Common Stock covered by the preceding paragraph), (iii) rights or warrants to subscribe for or purchase any security, or (iv) any other asset (including cash) (in each case, “Distributed Property”), then, upon any exercise of this Warrant that occurs after the record date fixed for determination of stockholders entitled to receive such distribution, the Holder shall be entitled to receive, in addition to the Warrant Shares otherwise issuable upon such exercise (if applicable), the Distributed Property that such Holder
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would have been entitled to receive in respect of such number of Warrant Shares had the Holder been the record holder of such Warrant Shares immediately prior to such record date.
(c) Fundamental Transactions. If, at any time while this Warrant is outstanding (i) the Company effects any merger or consolidation of the Company with or into another Person, in which the shareholders of the Company as of immediately prior to the transaction own less than a majority of the outstanding stock of the surviving entity, (ii) the Company effects any sale of all or substantially all of its assets in one or a series of related transactions, (iii) any tender offer or exchange offer (whether by the Company or another Person) is completed pursuant to which holders of a majority of the outstanding shares of Common Stock tender or exchange their shares for other securities, cash or property, or (iv) the Company effects any reclassification of all outstanding Common Stock or any compulsory share exchange pursuant to which all outstanding Common Stock is effectively converted into or exchanged for other securities, cash or property (each, a “Fundamental Transaction”), then the Holder shall have the right thereafter to receive, upon any subsequent exercise of this Warrant, the same amount and kind of securities, cash or property as it would have been entitled to receive upon the occurrence of such Fundamental Transaction if it had been, immediately prior to such Fundamental Transaction, the holder of the number of Warrant Shares then issuable upon exercise in full of this Warrant (the “Alternate Consideration”). The Company shall not effect any such Fundamental Transaction unless prior to or simultaneously with the consummation thereof, any successor to the Company, surviving entity or the corporation purchasing or otherwise acquiring such assets or other appropriate corporation or entity shall assume the obligation to deliver to the Holder, such Alternate Consideration as, in accordance with the foregoing provisions, the Holder may be entitled to purchase, and the other obligations under this Warrant.
(d) Number of Warrant Shares. Simultaneously with any adjustment to the Exercise Price pursuant to paragraph (a) of this Section 9, the number of Warrant Shares that may be purchased upon exercise of this Warrant shall be increased or decreased proportionately, so that after such adjustment the aggregate Exercise Price payable hereunder for the adjusted number of Warrant Shares shall be the same as the aggregate Exercise Price in effect immediately prior to such adjustment.
(e) Subsequent Equity Sales.
(i) If the Company shall at any time issue shares of Common Stock or Convertible Securities entitling any Person to acquire shares of Common Stock, at a price per share less than the Market Price immediately prior to the time of such issuance (if the holder of the Common Stock or Convertible Securities so issued shall at any time, whether by operation of purchase price adjustments, reset provisions, floating conversion, exercise or exchange prices or otherwise, or due to warrants, options or rights issued in connection with such issuance, be entitled to receive shares of Common Stock at a price less than the Market Price, such issuance shall be deemed to have occurred for less than the Market Price) (the foregoing a “Dilutive Issuance”), then immediately after such Dilutive Issuance, the Exercise Price then in effect shall be reduced to an amount equal to the product of (A) the Exercise Price in effect immediately prior to such Dilutive Issuance and (B) the quotient determined by dividing (1) the sum of (I) the product derived by multiplying the Exercise Price in effect immediately prior to such Dilutive Issuance and the number of shares of Common Stock Deemed Outstanding immediately prior to such Dilutive Issuance plus (II) the consideration, if any, received by the Company upon such Dilutive Issuance, by (2) the product derived by multiplying (I) the Exercise Price in effect immediately prior to such Dilutive Issuance by (II) the number of shares of Common Stock
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Deemed Outstanding immediately after such Dilutive Issuance. The number of Warrant Shares which the Holder may acquire under this Warrant will not be affected thereby. Such adjustment shall be made whenever such Common Stock or Convertible Securities are issued. The Company shall notify the Holder in writing, no later than the Trading Day following the issuance of any Common Stock or Convertible Securities subject to this Section, indicating therein the applicable issuance price, or the applicable reset price, exchange price, conversion price and other pricing terms.
(ii) For purposes of this subsection 9(e), the following subsections (e)(ii)(l) to (e)(ii)(7) shall also be applicable:
(1) Issuance of Rights or Options. In case at any time the Company shall in any manner grant (directly and not by assumption in a merger or otherwise) any warrants or other rights to subscribe for or to purchase, or any options for the purchase of, Common Stock or any stock or security convertible into or exchangeable for Common Stock (such warrants, rights or options being called “Options” and such convertible or exchangeable stock or securities being called “Convertible Securities”), whether or not such Options or the right to convert or exchange any such Convertible Securities are immediately exercisable, and the price per share for which Common Stock is issuable upon the exercise of such Options or upon the conversion or exchange of such Convertible Securities (determined by dividing (i) the sum (which sum shall constitute the applicable consideration) of (x) the total amount, if any, received or receivable by the Company as consideration for the granting of such Options, plus (y) the aggregate amount of additional consideration payable to the Company upon the exercise of all such Options, plus (z), in the case of such Options that relate to Convertible Securities, the aggregate amount of additional consideration, if any, payable upon the issue or sale of such Convertible Securities and upon the conversion or exchange thereof, by (ii) the total maximum number of shares of Common Stock issuable upon the exercise of such Options or upon the conversion or exchange of all such Convertible Securities issuable upon the exercise of such Options) shall be less than the Market Price immediately prior to the time of the granting of such Options, then the total number of shares of Common Stock issuable upon the exercise of such Options or upon conversion or exchange of the total amount of such Convertible Securities issuable upon the exercise of such Options shall be deemed to have been issued for such price per share as of the date of granting of such Options or the issuance of such Convertible Securities and thereafter shall be deemed to be outstanding for purposes of adjusting the Exercise Price. Except as otherwise provided in subsection 9(e)(ii)(3), no adjustment of the Exercise Price shall be made upon the actual issue of such Common Stock or of such Convertible Securities upon exercise of such Options or upon the actual issue of such Common Stock upon conversion or exchange of such Convertible Securities.
(2) Issuance of Convertible Securities. In case the Company shall in any manner issue (directly and not by assumption in a merger or otherwise) or sell any Convertible Securities, whether or not the rights to exchange or convert any such Convertible Securities are immediately exercisable, and the price per share for which Common Stock is issuable upon such conversion or exchange (determined by dividing (i) the sum (which sum shall constitute the applicable consideration) of (x) the total amount received or receivable by the Company as consideration for the issue or sale of such Convertible Securities, plus (y) the aggregate amount of additional consideration, if any, payable to the Company upon the conversion or exchange thereof, by (ii) the total number of shares of Common Stock issuable upon the conversion or exchange of all such Convertible Securities) shall be less than the Market Price immediately prior to the time of such issue or sale, then the total maximum number of shares of Common Stock issuable upon conversion or exchange of all such Convertible Securities
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shall be deemed to have been issued for such price per share as of the date of the issue or sale of such Convertible Securities and thereafter shall be deemed to be outstanding for purposes of adjusting the Exercise Price, provided that (a) except as otherwise provided in subsection 9(e)(ii)(3), no adjustment of the Exercise Price shall be made upon the actual issuance of such Common Stock upon conversion or exchange of such Convertible Securities and (b) no further adjustment of the Exercise Price shall be made by reason of the issue or sale of Convertible Securities upon exercise of any Options to purchase any such Convertible Securities for which adjustments of the Exercise Price have been made pursuant to the other provisions of subsection 9(e). No adjustment pursuant to this Section 9 shall be made if such adjustment would result in an increase of the Exercise Price then in effect.
(3) Change in Option Price or Conversion Rate. Upon the happening of any of the following events, namely, if the purchase price provided for in any Option referred to in subsection 9(e)(ii)(l) hereof, the additional consideration, if any, payable upon the conversion or exchange of any Convertible Securities referred to in subsections 9(e)(ii)(l) or 9(e)(ii)(2), or the rate at which Convertible Securities referred to in subsections 9(e)(ii)(l) or 9(e)(ii)(2) are convertible into or exchangeable for Common Stock shall change at any time (including, but not limited to, changes under or by reason of provisions designed to protect against dilution), the Exercise Price in effect at the time of such event shall forthwith be readjusted to the Exercise Price that would have been in effect at such time had such Options or Convertible Securities still outstanding provided for such changed purchase price, additional consideration or conversion rate, as the case may be, at the time initially granted, issued or sold.
(4) Stock Dividends. Subject to the provisions of this Section 9(e), in case the Company shall declare a dividend or make any other distribution upon any stock of the Company (other than the Common Stock) payable in Common Stock, Options or Convertible Securities, then any Common Stock, Options or Convertible Securities, as the case may be, issuable in payment of such dividend or distribution shall be deemed to have been issued or sold without consideration.
(5) Consideration for Stock. In case any shares of Common Stock, Options or Convertible Securities shall be issued or sold for cash, the consideration received therefor shall be deemed to be the gross amount received by the Company therefor. In case any shares of Common Stock, Options or Convertible Securities shall be issued or sold for a consideration other than cash, the amount of the consideration other than cash received by the Company shall be deemed to be the fair value of such consideration as determined in good faith by the board of directors of the Company (the "Board of Directors"). In case any Options shall be issued in connection with the issue and sale of other securities of the Company, together comprising one integral transaction in which no specific consideration is allocated to such Options by the parties thereto, such Options shall be deemed to have been issued for such consideration as determined in good faith by the Board of Directors. If Common Stock, Options or Convertible Securities shall be issued or sold by the Company and, in connection therewith, other Options or Convertible Securities (the “Additional Rights”) are issued, then the consideration received or deemed to be received by the Company shall be reduced by the fair market value of the Additional. The Board of Directors shall respond promptly, in writing, to an inquiry by the Holder as to the fair market value of the Additional Rights. In the event that the Board of Directors and the Holder are unable to agree upon the fair market value of the Additional Rights, the Company and the Holder shall jointly select an appraiser who is experienced in such matters. The decision of such appraiser shall be final and conclusive, and the cost of such appraiser shall be borne evenly by the Company and the Holder.
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(6) Record Date. In case the Company shall take a record of the holders of its Common Stock for the purpose of entitling them (i) to receive a dividend or other distribution payable in Common Stock, Options or Convertible Securities or (ii) to subscribe for or purchase Common Stock, Options or Convertible Securities, then such record date shall be deemed to be the date of the issue or sale of the shares of Common Stock deemed to have been issued or sold upon the declaration of such dividend or the making of such other distribution or the date of the granting of such right of subscription or purchase, as the case may be.
(7) Treasury Shares. The number of shares of Common Stock outstanding at any given time shall not include shares owned or held by or for the account of the Company or any of its wholly-owned subsidiaries, and the disposition of any such shares (other than the cancellation or retirement thereof) shall be considered an issue or sale of Common Stock for the purpose of this subsection (e).
(iii) Notwithstanding the foregoing, no adjustment will be made under this paragraph (e) in respect of: (i) the issuance of securities upon the exercise or conversion of any Common Stock or Convertible Securities issued by the Company prior to the date hereof; provided that neither the conversion price, exercise price nor number of shares issuable under such Convertible Securities (excluding any Convertible Securities covered by clause (ii) below) is amended, modified or changed after the issuance date thereof other than pursuant to the provisions of such Convertible Securities as they exist as of such issuance date, (ii) the grant of options, warrants, Common Stock or other Convertible Securities (but not including any amendments to such instruments) under any duly authorized Company stock option, restricted stock plan or stock purchase plan whether now existing or hereafter approved by the Company and its stockholders in the future, and the issuance of Common Stock in respect thereof, (iii) the issuance of securities in connection with a Strategic Transaction, (iv) in the event the Company’s securities are included in a nationally recognized stock index, the issuance in any manner whatsoever by the Company of Common Stock to certain index funds that track such stock index, or (v) the issuance of securities in a transaction described in Section 9(a) or 9(b) (collectively, “Excluded Issuances”). For purposes of this paragraph, a “Strategic Transaction” means a transaction or relationship in which (1) the Company issues shares of Common Stock to a Person that the Board of Directors determined in good faith is, itself or through its subsidiaries, an operating company in a business synergistic with the business of the Company (or a shareholder thereof) and (2) the Company expects to receive benefits in addition to the investment of funds.
(f) Calculations. All calculations under this Section 9 shall be made to the nearest cent or the nearest 1/100th of a share, as applicable. The number of shares of Common Stock outstanding at any given time shall not include shares owned or held by or for the account of the Company, and the disposition of any such shares shall be considered an issue or sale of Common Stock.
(g) De Minimis Adjustments. No adjustment in the Exercise Price shall be required unless such adjustment would require an increase or decrease of at least $0.01 in such price; provided, however, that any adjustment which by reason of this Section 9(g) is not required to be made shall be carried forward and taken into account in any subsequent adjustments under this Section 9. All calculations under this Section 9 shall be made by the Company in good faith and shall be made to the nearest cent or to the nearest one hundredth of a share, as applicable. No adjustment need be made for a change in the par value or no par value of the Company’s Common Stock.
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(h) Notice of Adjustments. Upon the occurrence of each adjustment pursuant to this Section 9, the Company at its expense will, at the written request of the Holder, promptly compute such adjustment in accordance with the terms of this Warrant and prepare a certificate setting forth such adjustment, including a statement of the adjusted Exercise Price and adjusted number or type of Warrant Shares or other securities issuable upon exercise of this Warrant (as applicable), describing the transactions giving rise to such adjustments and showing in detail the facts upon which such adjustment is based. Upon written request, the Company will promptly deliver a copy of each such certificate to the Holder and to the American Stock Transfer & Trust Company, the transfer agent of the Company.
(i) Notice of Corporate Events. If, while this Warrant is outstanding, the Company (i) declares a dividend or any other distribution of cash, securities or other property in respect of its Common Stock, including without limitation any granting of rights or warrants to subscribe for or purchase any capital stock of the Company or any Subsidiary, (ii) authorizes or approves, enters into any definitive agreement for or solicits stockholder approval for any Fundamental Transaction or (iii) authorizes the voluntary dissolution, liquidation or winding up of the affairs of the Company, then, except if such notice and the contents thereof shall be deemed to constitute material non-public information, the Company shall deliver to the Holder a notice describing the material terms and conditions of such transaction at least 10 Trading Days prior to the applicable record or effective date on which a Person would need to hold Common Stock in order to participate in or vote with respect to such transaction, and the Company will take all reasonable steps to give Holder the practical opportunity to exercise this Warrant prior to such time; provided, however, that the failure to deliver such notice or any defect therein shall not affect the validity of the corporate action required to be described in such notice.
10. Payment of Exercise Price. The Holder shall pay the Exercise Price in immediately available funds.
11. Limitations on Exercise. Notwithstanding anything to the contrary contained herein, the number of Warrant Shares that may be acquired by the Holder upon any exercise of this Warrant (or otherwise in respect hereof) shall be limited to the extent necessary to ensure that, following such exercise (or other issuance), the total number of shares of Common Stock then beneficially owned by the Holder and its affiliates and any other Persons whose beneficial ownership of Common Stock would be aggregated with the Holder’s for purposes of Section 13(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), does not exceed 19.99% of the total number of issued and outstanding shares of Common Stock (including for such purpose the shares of Common Stock issuable upon such exercise). For such purposes, beneficial ownership shall be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder. Each delivery of an Exercise Notice by the Holder will constitute a representation by the Holder that it has evaluated the limitation set forth in this Section and determined that issuance of the full number of Warrant Shares requested in such Exercise Notice is permitted under this Section. The Company’s obligation to issue shares of Common Stock in excess of the limitation referred to in this Section shall be suspended (and, except as provided below, shall not terminate or expire notwithstanding any contrary provisions hereof) until such time, if any, as such shares of Common Stock may be issued in compliance with such limitation; provided, that, if, as of 5:30 p.m., New York City time, on the Expiration Date, the Company has not received written notice that the shares of Common Stock may be issued in compliance with such limitation, the Company’s obligation to issue such shares shall terminate. This provision shall not restrict the number of shares of Common Stock which a Holder may receive or beneficially own in order to determine the amount of securities or other consideration that such Holder may receive in the event of a Fundamental Transaction as contemplated in Section 9 of this Warrant.
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12. No Fractional Shares. No fractional Warrant Shares will be issued in connection with any exercise of this Warrant. In lieu of any fractional shares that would otherwise be issuable, the Company shall pay cash equal to the product of such fraction multiplied by the closing price of one Warrant Share as reported by the applicable Trading Market on the Exercise Date.
13. Notices. Any and all notices or other communications or deliveries hereunder (including, without limitation, any Exercise Notice) shall be in writing and shall be deemed given and effective on the earliest of (i) the date of transmission, if such notice or communication is delivered via facsimile at the facsimile number specified in this Section 13 at or prior to 5:00 p.m. (New York City time) on a Trading Day, (ii) the next Trading Day after the date of transmission, if such notice or communication is delivered via facsimile at the facsimile number specified in this Section 13 on a day that is not a Trading Day or later than 5:00 p.m. (New York City time) on any Trading Day, (iii) the Trading Day following the date of mailing, if sent by nationally recognized overnight courier service, or (iv) upon actual receipt by the party to whom such notice is required to be given. The addresses for such notices or communications shall be: (a) if to the Company, to Paramount Gold Nevada Corp, 665 Anderson Street, Winnemucca, NE 89445, Attention: Chief Financial Officer, Email: carlo@paramountnevada.com (or such other address as the Company shall indicate in writing in accordance with this Section 13) or (b) if to the Holder, to the address or facsimile number appearing on the Warrant Register (or such other address as the Company shall indicate in writing in accordance with this Section 13).
14. Warrant Agent. The Company shall serve as warrant agent under this Warrant. Upon 30 days’ notice to the Holder, the Company may appoint a new warrant agent. Any corporation into which the Company or any new warrant agent may be merged or any corporation resulting from any consolidation to which the Company or any new warrant agent shall be a party or any corporation to which the Company or any new warrant agent transfers substantially all of its corporate trust or shareholders services business shall be a successor warrant agent under this Warrant without any further act. Any such successor warrant agent shall promptly cause notice of its succession as warrant agent to be mailed (by first class mail, postage prepaid) to the Holder at the Holder’s last address as shown on the Warrant Register.
15.Miscellaneous.
(a) This Warrant shall be binding on and inure to the benefit of the parties hereto and their respective successors and assigns. Subject to the preceding sentence, nothing in this Warrant shall be construed to give to any Person other than the Company and the Holder any legal or equitable right, remedy or cause of action under this Warrant. This Warrant may be amended only in writing signed by the Company and the Holder, or their successors and assigns.
(b) All questions concerning the construction, validity, enforcement and interpretation of this Warrant shall be governed by and construed and enforced in accordance with the internal laws of the State of New York, without regard to the principles of conflicts of law thereof. Each party agrees that all legal proceedings concerning the interpretations, enforcement and defense of this Warrant and the transactions herein contemplated (“Proceedings”) (whether brought against a party hereto or its respective Affiliates, employees or agents) shall be commenced exclusively in the courts of the State of New York located in the City and County of New York or in the United States District Court for the Southern District of New York (the “New York Courts”). Each party hereto hereby irrevocably submits to the exclusive jurisdiction of the New York Courts for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any Proceeding, any claim that it is not personally
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subject to the jurisdiction of any New York Court, or that such Proceeding has been commenced in an improper or inconvenient forum. Each party hereto hereby irrevocably waives personal service of process and consents to process being served in any such Proceeding by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Warrant and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any manner permitted by law. Each party hereto hereby irrevocably waives, to the fullest extent permitted by applicable law, any and all right to trial by jury in any legal proceeding arising out of or relating to this Warrant or the transactions contemplated hereby. If either party shall commence a Proceeding to enforce any provisions of this Warrant, then the prevailing party in such Proceeding shall be reimbursed by the other party for its attorney’s fees and other costs and expenses incurred with the investigation, preparation and prosecution of such Proceeding.
(c) The headings herein are for convenience only, do not constitute a part of this Warrant and shall not be deemed to limit or affect any of the provisions hereof.
(d) In case any one or more of the provisions of this Warrant shall be invalid or unenforceable in any respect, the validity and enforceability of the remaining terms and provisions of this Warrant shall not in any way be affected or impaired thereby and the parties will attempt in good faith to agree upon a valid and enforceable provision which shall be a commercially reasonable substitute therefore, and upon so agreeing, shall incorporate such substitute provision in this Warrant.
(e) Prior to exercise of this Warrant, the Holder hereof shall not, by reason of by being a Holder, be entitled to any rights of a stockholder with respect to the Warrant Shares
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IN WITNESS WHEREOF, the Company has caused this Warrant to be duly executed by its authorized officer as of the date first indicated above.
PARAMOUNT GOLD NEVADA CORP.
By: _______________________
Name:
Title:
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Exhibit 4.1
PARAMOUNT GOLD NEVADA CORP.
WARRANT NO. ___ DATED July___, 2018
Ladies and Gentlemen:
(1) The undersigned hereby elects to exercise the above-referenced Warrant with respect to ____________ shares of Common Stock. Capitalized terms used herein and not otherwise defined herein have the respective meanings set forth in the Warrant.
(2) The holder shall pay the sum of $___to the Company in accordance with the terms of the Warrant.
(4) Pursuant to this Exercise Notice, the Company shall deliver to the Holder the number of Warrant Shares determined in accordance with the terms of the Warrant.
(5) By its delivery of this Exercise Notice, the undersigned represents and warrants to the Company that in giving effect to the exercise evidenced hereby the Holder will not beneficially own in excess of the number of shares of Common Stock (as determined in accordance with Section 13(d) of the Securities Exchange Act of 1934) permitted to be owned under Section 11 of this Warrant to which this notice relates.
HOLDER:
___________________________________
(Print Name)
By:__________________________________
Name:
Title:
Exhibit 4.1
WARRANT ORIGINALLY ISSUED JULY___, 2018
WARRANT NO. ____
FORM OF ASSIGNMENT
To be completed and signed only upon transfer of Warrant
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto __________ the right represented by the within Warrant to purchase __________ shares of Common Stock to which the within Warrant relates and appoints __________ attorney to transfer said right on the books of the Company with full power of substitution in the premises.
Dated:
TRANSFEROR:
___________________________________
(Print Name)
By:__________________________________
Name:
Title:
TRANSFEREE:
___________________________________
(Print Name)
__________________________________
__________________________________
(Address of Transferee)
In the presence of:
_______________________________
DM3\5243215.4
Exhibit 10.1
Name of Investor:
SUBSCRIPTION AGREEMENT
____________________________
THIS SUBSCRIPTION AGREEMENT (the “Agreement”) by and between Paramount Gold Nevada Corp., a Nevada corporation (the “Company”), and the undersigned individual, corporation, limited liability company, partnership, trust or employee benefit plan executing this Agreement as the investor (the “Investor”), provides as follows:
Recitals
A.This Agreement is made in connection with the Company’s offering (the “Offering”) of units (the “Units”) each consisting of one share (the “Shares”) of the Company’s common stock, par value $0.01 per share (“Common Stock”) and one warrant to purchase one-half of one Share of Common Stock (the “Warrants”), pursuant to that certain Confidential Private Placement Memorandum dated June 22, 2018 (the “Memorandum”).
B.The Company wishes to sell to the Investor and the Investor wishes to purchase from the Company the number of Units specified on the signature page hereof at the price per Unit set forth in Section 2 hereof, subject to the terms, conditions, and requirements contained in this Agreement.
C.The Investor understands that the Company has the right, in its sole discretion, to refuse to accept the Investor’s subscription in whole or in part at any time and for any reason, including without limitation the Company’s belief that the Investor does not meet the applicable suitability requirements for participation in the Offering or that the investment is otherwise unsuitable for the Investor.
NOW, THEREFORE, in consideration of the foregoing and the promises and covenants contained in this Agreement, the Company and the Investor hereby agree as follows:
1.Sale of Units. In accordance with the terms and conditions of this Agreement, the Company hereby agrees to sell to the Investor, and the Investor hereby agrees to purchase from the Company, on or before July 6, 2018, or such later date on or before July 13, 2018, that the Company in its sole discretion chooses (the “Closing Date”), the number of Units indicated on the signature page hereof. The obligation of the Company to sell the Units to the Investor is subject to, among other things, the conditions that: (i) the Company receives approval for the listing of the Shares on the NYSE American (the “Stock Exchange” or “NYSE American”); and (ii) all other necessary regulatory approvals are obtained prior to the Closing Date.
2.Purchase Price. The purchase price (“Purchase Price”) for each Unit shall be US$1.25. The Investor shall pay such purchase price certified check or bank draft payable to the Company (or by wire transfer, per instructions to be provided upon request) and delivered with this executed Agreement:
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2.1 |
a completed Investor Questionnaire (the “Investor Questionnaire”) attached hereto as Exhibit “A” and, if the Investor is a resident of Canada and is: |
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2.1.1.1 |
a completed Canadian Accredited Investor Certificate; and |
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2.1.1.2 |
if the Investor is an individual described in category (j), (k) or (l) of the Canadian Accredited Investor Certificate and does not meet the higher financial asset threshold set out in paragraph (j.1) of the Canadian Accredited Investor Certificate, a completed Form 45-106F9 - Form for Individual Accredited Investors, attached hereto as Exhibit C; or |
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2.1.2 |
an Ontario resident purchasing the Units pursuant to the “Family, Friends and Business Associates” prospectus exemption contained in section 2.5 of National Instrument 45-106 – Prospectus Exemptions (“NI 45‑106”) of the Canadian Securities Administrators, a completed Form 45-106F12 - Ontario Risk Acknowledgement Form for Family, Friend and Business Associate Investors, attached hereto as Exhibit “ D”; and |
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2.2 |
any other further documentation as required under the applicable securities laws or Stock Exchange or other regulatory authority. |
Subscriptions for Units may be accepted or rejected by the Company for any or no reason in its sole discretion.
3.Representations and Warranties of Investor. The Investor represents and warrants to the Company as follows (which representations and warranties shall survive the Closing Date):
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answers contained in the Investor Questionnaire and, if applicable, the Canadian Exemption Certifications. |
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3.2 |
If the Investor is a corporation, limited liability company, partnership, trust, or employee benefit plan, it is authorized to make the investment contemplated herein, and the person signing this Agreement on behalf of such entity has been duly authorized by such entity to do so. |
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3.3 |
This Agreement has been duly authorized, executed and delivered by the Investor and constitutes the Investor’s legal, valid and binding obligation enforceable in accordance with its terms. |
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3.4 |
The Investor is acquiring the Units as principal for the Investor’s own account for investment and not with a view to resale or distribution. The Investor understands that the Shares and the Warrants have not been, and will not be, registered under the Securities Act of 1933, as amended (the “1933 Act”), or applicable securities laws by reason of specific exemptions from the registration provisions of the 1933 Act and applicable state securities laws that depend upon, among other things, the bona fide nature of the investment intent and the accuracy of the Investor’s representations and warranties as expressed in this Agreement and in the Investor Questionnaire. |
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3.5 |
The Company has advised the Investor, if the Investor is a resident of Canada, that the Company is relying on an exemption from the requirements under applicable Canadian securities laws to provide the Investor with a prospectus and that no prospectus has been filed by the Company with any securities commission in Canada in connection with the Offering, and as a consequence: |
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3.5.1 |
the Investor is restricted from using most of the civil remedies available under applicable Canadian securities laws and certain protections, rights and remedies provided by applicable Canadian securities laws, including statutory rights of rescission or damages, will not be available to the Investor; |
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3.5.2 |
the Investor may not receive information that would otherwise be required to be provided to the Investor under the applicable Canadian securities laws; and |
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3.5.3 |
the Investor is relieved from certain obligations that would otherwise apply under the applicable Canadian securities laws. |
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to the Units, the Company or its business other than the Memorandum and this Agreement (including all exhibits and amendments thereto and hereto). |
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3.7 |
The Investor recognizes that (i) the purchase of the Units involves a high degree of risk and has taken full cognizance of and understands such risks, (ii) that all information provided, if any, by the Company relating to its use of proceeds, financial forecasts, and other information which is not of an historical nature (“Forward-looking Information”), represents only the Company’s good faith assessment of such Forward-looking Information, and is based upon assumptions which the Company believes are reasonable, although no assurance exists that such Forward-looking Information is accurate or will be fulfilled, and (iii) that the Company has relied on the representations of the Investor as set forth in this Agreement, in the Investor Questionnaire and, if applicable, the Canadian Accredited Investor Certificate, in determining materiality for purposes of satisfying the disclosure obligations of the Company and in determining the availability of exemptions from (a) registration requirements under applicable United States federal and state securities laws; and (b) prospectus requirements under applicable Canadian securities laws. |
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3.8 |
The Investor is resident in the jurisdiction set out on the execution page of the Investor Questionnaire, which address is the Investor’s residence or principal place of business, and such address was not obtained or used solely for the purpose of acquiring the Units. |
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3.9 |
The Investor fully understands and agrees that the Investor must bear the economic risk of the purchase of the Units, including the Shares and the Warrants, for an indefinite period of time because, among other reasons, neither the Units, Shares nor the Warrants have been registered under the 1933 Act, or the securities laws of any state, and therefore cannot be sold, pledged, assigned or otherwise disposed of unless they are subsequently registered under the 1933 Act and applicable state securities laws or exemptions from such registration requirements are available. The Investor further understands and agrees that the Company will not honor any attempt by the Investor to sell, pledge, transfer, or otherwise dispose of all or any portion of the Shares in the absence of an effective registration statement under the 1933 Act and applicable state securities laws or an unqualified opinion of counsel, satisfactory in form and substance to the Company and its counsel, and obtained at the expense of the Investor, that exemptions are available therefrom with respect to such attempted disposition. |
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3.10 |
The Investor, if a resident of Canada, acknowledges that the certificates representing the Shares and Warrants will bear a legend as of the Closing Date substantially in the following form (and with the necessary information inserted): |
“Unless permitted under securities legislation, the holder of this security must not trade the security before n, 2018.” (the date which is four months and one day after the Closing Date will be inserted).
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3.12 |
The Investor has not incurred, and will not incur, directly or indirectly, as a result of any action taken by the Investor, any liability for brokerage or finder’s fees or agent’s commissions or any similar charges in connection with this Agreement. |
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3.13 |
The Investor acknowledges that he, she or it must depend entirely upon his, her or its own personal advisors for tax advice concerning an investment in the Company, that the Company has not provided any information on tax matters, and that any information provided to Investor by, or on behalf of, the Company is not to be construed as tax advice to Investor from the Company or counsel to the Company. The Investor will rely solely on his, her or its own personal advisors and not on any statements or representations of the Company or any of its agents and understands that the Investor (and not the Company) shall be responsible for the Investor’s own tax liability that may arise as a result of this investment or the transactions contemplated by this Agreement. |
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3.14 |
The Investor understands and agrees that the Company is issuing the Units to him, her or it pursuant to the exemptions from federal and state securities registration requirements under the 1933 Act. In connection therewith, the Investor represents and warrants that the Investor qualifies as an “Accredited Investor” as such term is defined under Rule 501 of the 1933 Act (a “U.S. Accredited Investor”) and has confirmed that on the Investor Questionnaire attached hereto as Exhibit “A”. The Investor, if a resident of Canada (other than a person that is not an individual who purchases as principal such number of Units having an acquisition cost to person of not less than Cdn$150,000 paid in cash at the time of Closing), also represents and warrants that the Investor either: |
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3.14.1 |
qualifies as an “Accredited Investor” as such term is defined in NI 45-106, and has confirmed same on the Canadian Accredited Investor Certificate attached hereto as Exhibit “B” and that the Investor was not created or used solely to purchase or hold securities as an Accredited Investor as described in paragraph (m) of the definition of Accredited Investor set out in Exhibit “B”; or |
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3.14.2 |
is purchasing the Units pursuant to the “Family, Friends and Business Associates” prospectus exemption and has confirmed that on the Investor Questionnaire. |
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If the Investor is a resident of Canada, is not an individual and purchases as principal such number of Units having an acquisition cost to the Investor of not less than Cdn$150,000 paid in cash at the time of Closing, such Investor also represents and warrants that the Investor was not created, or is used, solely to purchase or hold securities in reliance on the exemption from the prospectus requirement set out in subsection 2.10(1) of NI 45-106.
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3.15 |
The Investor agrees to comply with all securities laws and with the policies of the Stock Exchange concerning the purchase of, the holding of, and the resale restrictions applicable to, the Shares and the Warrants. The Investor recognizes that the securities laws and regulations of certain jurisdictions, which may include the jurisdiction of which the Investor is a resident, may impose additional requirements relating to this Offering and the Investor’s purchase of the Shares and the Warrants. The Investor hereby agrees to execute and to comply with the terms of any additions, supplements or amendments to this Agreement which are required by the Company. |
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3.16 |
The funds representing the aggregate purchase price in respect of the Units which will be advanced by the Investor to the Company hereunder will not represent proceeds of crime for the purpose of the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (Canada) (the “PCMLTF Act”) and the Investor acknowledges that the Company may in the future be required by law to disclose the Investor’s name and other information relating to this Agreement and the Investor’s subscription hereunder, on a confidential basis, pursuant to the PCMLTF Act; to the best of the Investor’s knowledge, none of the subscription funds to be provided hereunder (i) have been or will be obtained or derived, directly or indirectly, from or related to any activity that is deemed illegal under the laws of Canada or the United States or any other jurisdiction, or (ii) are being tendered on behalf of a person or entity who has not been identified to the Investor; the Investor shall promptly notify the Company if he discovers that any such representation ceases to be true, and shall provide the Company with appropriate information in connection therewith. |
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3.17 |
The Investor acknowledges that no agency, stock exchange or governmental agency, securities commission or similar regulatory authority or other entity has reviewed or passed on or made any finding or determination as to the merits of or made any recommendation or endorsement with respect to the Shares and the Warrants. |
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3.18 |
There is no government or other insurance covering the Shares or the Warrants. |
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4.Registration. The Company covenants to use its best efforts to file and have declared effective by the Securities and Exchange Commission (the “SEC”) a registration statement on Form S-3 registering the resale in the United States by the Investor of the Shares and the Common Stock underlying the Warrants. Investors who are residents of Canada acknowledge that the Shares will be subject to a 4 month hold period in Canada under applicable Canadian securities laws, regardless of whether or not the Company has filed and have declared effective by the SEC a registration statement on Form S-3 registering the resale in the United States by the Investor of the Shares.
5.Personal Information. If the Investor is a resident of a jurisdiction of Canada and is an individual, the Investor authorizes the indirect collection of the Personal Information by the securities regulatory authority or regulator (each as defined in National Instrument 14-101 - Definitions) and confirms that the Investor has been notified by the Company: (a) that the Company will be delivering the Personal Information to the securities regulatory authority or regulator; (b) that the Personal Information is being collected by the securities regulatory authority or regulator under the authority granted in applicable securities laws; (c) that the Personal Information is being collected for the purposes of the administration and enforcement of applicable securities laws; and (d) that the title, business address and business telephone number of the public official who can answer questions about the securities regulatory authority’s or regulator’s indirect collection of the Personal Information is as set out in Exhibit “E”.
6.Applicable Law; Venue. This Agreement shall be construed in accordance with and governed by the laws of the State of New York without reference to the choice of law principles of any jurisdiction. THE INVESTOR IRREVOCABLY AND UNCONDITIONALLY CONSENTS TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK AND OF THE UNITED STATES LOCATED IN THE CITY OF NEW YORK, NEW YORK, IN CONNECTION WITH ANY SUIT, ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR THE OFFERING AND AGREES NOT TO COMMENCE ANY SUIT, ACTION, OR PROCEEDING RELATING THERETO EXCEPT IN SUCH COURTS.
7.Binding Effect. Except as otherwise provided herein, this Agreement shall be binding upon and inure to the benefit of the parties and their respective heirs, executors, administrators, successors, legal representatives and assigns
8.Notice. All notices and other communications required or permitted hereunder or necessary or convenient in connection herewith shall be in writing and shall be deemed to have been given three business days after the date mailed when mailed by registered or certified mail, postage prepaid, or the next business day if sent by special courier such as FedEx (except that notice of change of address shall be deemed given only when received), to the address shown on the Company's records, in the case of the Investor, and of the Company's registered office, in the case of the Company, or to such other names or addresses as the Company or the Investor, as the case may be, shall designate by notice to the other party in the manner specified in this Section.
9.Severability. If any provision of this Agreement or application thereof to anyone or under any circumstances is adjudicated to be invalid or unenforceable in any jurisdiction, such invalidity or unenforceability shall not affect any other provisions or applications of this Agreement that can be given effect without the invalid or unenforceable provision or application
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and shall not invalidate or render unenforceable the invalid or unenforceable provision in any other jurisdiction or under any other circumstance.
10.Entire Agreement. This Agreement, and the Units purchased hereunder, constitute the entire agreement by and between the parties pertaining to the subject matter hereof and supersede all prior and contemporaneous understandings of the parties.
11.Counterparts. This Agreement may be executed in any number of counterparts, and any party hereto may execute such counterpart, each of which when so executed and delivered shall be deemed an original and all of which taken together shall constitute one and the same instrument. This Agreement shall become binding when either this Agreement or two or more counterparts hereto shall have been executed and delivered by the parties hereto
12.Variation in Pronouns. All pronouns shall be deemed to refer to masculine, feminine, neuter, singular, or plural, as the identity of the person or persons may require.
13.Counsel. This Agreement and all other agreements related to the Offering (the “Offering Agreements”) have been prepared by Duane Morris LLP, as counsel to the Company (“Counsel”), after full disclosure of its representation of the Company and with the consent and direction of the Company and the Investor. The Investor has reviewed the contents of the Offering Agreements and fully understands their terms. The Investor acknowledges that he, she or it is fully aware of his, her or its right to the advice of counsel independent from that of the Company, that Counsel has advised the Investor of such right and disclosed to the Investor the risks in not seeking such independent advice, and that he, she or it understands the potentially adverse interests of the parties with respect to the Offering Agreements. The Investor further acknowledges that no representations have been made with respect to the tax or other consequences of the Offering Agreements to the Investor and that he, she or it has been advised of the importance of seeking independent counsel with respect to such consequences. By executing this Agreement, the Investor represents that he, she or it has, after being advised of the potential conflicts between the Investor and the Company with respect to the future consequences of the Offering Agreements, either consulted independent legal counsel or elected, notwithstanding the advisability of seeking such independent legal counsel, not to consult such independent legal counsel.
[SIGNATURES APPEAR ON THE FOLLOWING PAGES]
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IN WITNESS WHEREOF, this Agreement has been duly executed by the duly authorized officer of the Company and the undersigned Investor or its duly authorized officer, as the case may be, as of the date first written beneath the signature of such officer of the Company below.
INVESTOR SIGNATURE:
[If Investor(s) is/are (an) Individual(s)]
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Print Investor's Full Name(s):
_______________________________________________________
Number of Units subscribed for by Investor______________
(US$1.25 per Unit)US$_____________
10
EXHIBIT “A”
INVESTOR QUESTIONNAIRE
(See Attached.)
DM3\5243217.4
INVESTOR QUESTIONNAIRE
____________________________
THIS QUESTIONNAIRE DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY A SECURITY. The sole purpose of this questionnaire is to establish whether the individual or entity on whose behalf this questionnaire is completed (the “Investor”) is a qualified investor to whom securities of Paramount Gold Nevada Corp. (the “Company”), may be offered and sold under applicable federal and state securities laws. The completed statement should indicate whether the Investor has or can be attributed with such knowledge and experience in financial and business matters as to be able to evaluate the merits and risks of an investment and whether the Investor has the financial means to bear the economic risks involved.
IMPORTANT: This form of Investor Questionnaire has been prepared for use by individuals and by entities such as partnerships, corporations and trusts. If the Investor is an entity, when completed this questionnaire should provide information regarding the entity and not particular partners, officers, directors, trustees or beneficiaries of the entity, unless specifically requested. Notwithstanding the foregoing, in the case of partnerships, corporations and trusts formed specifically for the purpose of participating in this investment, a questionnaire must be completed by each partner, shareholder, and beneficiary.
1. |
IF THE INVESTOR IS ONE OR MORE INDIVIDUALS: |
a.Name(s) of individual(s):
b.Address(es) of individual(s):
c.Telephone number(s) of individual(s): ( _____ )
d.Fax number(s) of individual(s): (_____)
e.Email address of individual(s):
f.Occupation(s) of individual(s):
g.Name(s) of employer(s):
A-2
DM3\5243217.4
2.IF THE INVESTOR IS AN ENTITY
a.Name of entity:
b.Form of entity:
(partnership, corporation, trust, etc.)
c.Date of organization of entity:
d.Address of entity:
e.Telephone number of entity:( _____ )
f.Fax number of entity: (______)
g.Email address of entity:
|
h. |
Please name the authorized representative(s) of the entity who will be acting for the entity in connection with its potential investment in the Company: |
i.Type of business entity is engaged in:
3. |
Please state the amount, in United States dollars, of the Investor's potential investment in the Company: |
$ .
4. |
The Investor is one or more of the following: |
|
_________ |
a natural person who had an individual income in excess of $200,000 in each of the two most recent years or joint income with a spouse in excess |
A-3
DM3\5243217.4
|
of $300,000 in each of those years and who reasonably expects to reach the same income level in the current year; |
|
_________ |
a natural person whose individual net worth, or joint net worth with that person's spouse, at the time of purchase exceeds $1,000,000, excluding the value of the primary residence of such natural person, calculated by subtracting from the estimated fair market value of the property the amount of debt secured by the property, up to the estimated fair market value of the property; |
|
_________ |
a trust, with total assets in excess of $5,000,000, not formed for the specific purpose of acquiring the securities offered, whose purchase is directed by a person who has such knowledge and experience in financial and business matters that he is capable of evaluating the merits and risks of the prospective investment; |
|
_________ |
a bank as defined in Section 3(a)(2) of the Securities Act of 1933 (the “Act”) or a savings and loan association or other institution as defined in Section 3(a)(5)(A) of the Act whether acting in its individual or fiduciary capacity; |
|
_________ |
a broker-dealer registered pursuant to Section 15 of the Securities Exchange Act of 1934; |
|
_________ |
an insurance company as defined in Section 2(13) of the Act; |
|
_________ |
an investment company registered under the Investment Company Act of 1940 or a business development company as defined in Section 2(a)(48) of the Investment Company Act of 1940; |
|
_________ |
a Small Business Investment Company licensed by the U.S. Small Business Administration under Section 301(c) or (d) of the Small Business Investment Act of 1958; |
|
_________ |
a plan established and maintained by a state, its political subdivisions, or any agency or instrumentality of a state or its political subdivisions, for the benefit of its employees, where such plan has total assets in excess of $5,000,000. |
|
_________ |
an employee benefit plan within the meaning of Title 1 of the Employee Retirement Income Security Act of 1974, where the investment decision is made by a plan fiduciary, as defined in Section 3(21) of such Act, which is either a bank, savings and loan association, insurance company, or registered investment adviser, or an employee benefit plan that has total assets in excess of $5,000,000, or if a self-directed plan the investment decisions are made solely by persons that are accredited investors; |
A-4
DM3\5243217.4
|
_________ |
a private business development company, as defined in Section 202(a)(22) of the Investment Advisers Act of 1940; |
|
_________ |
an organization described in Section 501(c)(3) of the Internal Revenue Code, a corporation, a Massachusetts or similar business trust, or a partnership, not formed for the specific purpose of acquiring the securities offered, with total assets in excess of $5,000,000; |
|
_________ |
a director or executive officer of the Company; |
|
_________ |
an entity in which all of the equity investors is a person described above. |
5. |
Additionally, the Investor, if a resident of Canada, is one or more of the following: |
|
_________ |
(a) purchasing the Units as principal and is an “Accredited Investor” within the meaning of National Instrument 45-106 entitled “Prospectus Exemptions” (“NI 45-106”) by virtue of the fact that the Investor falls within one or more of the subparagraphs of the definition of “Accredited Investor” set out in Exhibit “B” (YOU MUST ALSO COMPLETE EXHIBIT “B” ATTACHED TO THIS INVESTOR QUESTIONNAIRE AND, IF APPLICABLE, EXHIBIT “C”); or |
|
________ |
(b) a non-individual purchasing as principal such number of Units having an acquisition cost to the Investor of not less than Cdn$150,000 paid in cash at the time of Closing; or |
|
_________ |
(c) purchasing the Units as principal and is (please check the appropriate boxES; Ontario residents must also complete EXHIBIT “D”): |
Part A – Direct relationship with the Company (or affiliate) |
|||
|
☐ |
(a) |
a ☐ director, ☐ executive officer or ☐ control person of the Company (as such terms are defined in NI 45-106) or of an affiliate of the Company; or |
|
☐ |
(b) |
a founder of the Company; |
Part B – Family relationship |
|||
|
☐ |
(c) |
☐ a spouse, ☐ a parent, ☐ a grandparent, ☐ a brother, ☐ a sister, ☐ a child or ☐ a grandchild of {specify person} ____________________________, who is ☐ a director, ☐ an executive officer or ☐ a control person of the Company or of an affiliate of the Company; |
A-5
DM3\5243217.4
|
☐ |
(d) |
☐ a parent, ☐ a grandparent, ☐ a brother, ☐ a sister, ☐ a child or ☐ a grandchild of the spouse of {specify person} ____________________________, who is ☐ a director, ☐ an executive officer or ☐ a control person of the Company or of an affiliate of the Company |
|
☐ |
(e) |
☐ a spouse, ☐ a parent, ☐ a grandparent, ☐ a brother, ☐ a sister, ☐ a child or ☐ a grandchild of {specify person} ____________________________, who is a founder of the Company |
|
☐ |
(f) |
☐ a parent, ☐ a grandparent, ☐ a brother, ☐ a sister, ☐ a child or ☐ a grandchild of the spouse of {specify person} ____________________________, who is a founder of the Company |
Part C – Close personal friend |
|||
|
☐ |
(g) |
a close personal friend of {specify person} ____________________________, who is ☐ a director, ☐ an executive officer or ☐ a control person of the Company or of an affiliate of the Company, and whom the Investor has known for _________ years |
|
|
(h) |
a close personal friend of {specify person} ____________________________, who is a founder of the Company, and whom the Investor has known for _________ years {Note that a “close personal friend” of a specified person is someone who knows the specified person well enough and has known the specified person for a sufficient period of time to be in a position to assess the specified person’s capabilities and trustworthiness and to obtain information from the specified person with respect to this investment. To be a “close personal friend”, your relationship with the specified person must be direct. If your relationship with the specified person is primarily founded on participation in an internet forum, you are not considered to be a “close personal friend”. If you are a relative, a member of the same club, organization, association or religious group, a co-worker, colleague or associate at the same workplace, a client, customer, former client or former customer, or connected through social media, you are not necessarily a “close personal friend”. To determine whether you are a “close personal friend”, consider matters such as the frequency of contact you have with the specified person and the level of trust and reliance in your relationship.} |
A-6
DM3\5243217.4
|
☐ |
(i) |
a close business associate of {specify person} ____________________________, who is ☐ a director, ☐ an executive officer or ☐ a control person of the Company or of an affiliate of the Company, and whom the Investor has known for _________ years |
|
☐ |
(j) |
a close business associate of {specify person} ____________________________, who is a founder of the Company, and whom the Investor has known for _________ years {Note that a “close business associate” of a specified person is someone who has had sufficient prior business dealings with the specified person to be in a position to assess the specified person’s capabilities and trustworthiness and to obtain information from the specified person with respect to this investment. To be a “close business associate”, your relationship with the specified person must be direct. If your relationship with the specified person is primarily founded on participation in an internet forum, you are not considered to be a “close business associate”. If you are a member of the same club, organization, association or religious group, a co-worker, colleague or associate at the same workplace, a client, customer, former client or former customer, or connected through social media, you are not necessarily a “close business associate”. To determine whether you are a “close business associate”, consider matters such as the frequency of contact you have with the specified person and the level of trust and reliance in your relationship.} |
Part E – Corporate or other entities / trusts |
|||
|
☐ |
(k) |
a person of which a majority of the voting securities are beneficially owned by persons described in Parts A to D of paragraph 5(c) of this certificate, as specified below in this Part E {name each relevant person and describe how that person fits within a category described in Parts A to D of paragraph 5(c) of this certificate} |
|
☐ |
(l) |
a person of which a majority of the directors are persons described in Parts A to D of paragraph 5(c) of this certificate, as specified below in this Part E {name each relevant person and describe how that person fits within a category described in Parts A to D of paragraph 5(c) of this certificate} |
|
☐ |
(m) |
a trust or estate of which all the beneficiaries are persons described in Parts A to D of paragraph 5(c) of this certificate, as specified below in this Part E {name each relevant person and describe how that person fits within a category described in Parts A to D of paragraph 5(c) of this certificate} |
A-7
DM3\5243217.4
|
☐ |
(n) |
a trust or estate of which a majority of the trustees or executors are persons described in Parts A to D of paragraph 5(c) of this certificate, as specified below in this Part E {name each relevant person and describe how that person fits within a category described in Parts A to D of paragraph 5(c) of this certificate} NameCategory
|
6. |
If the Investor is a resident of Canada, check the following if applicable: |
|
_________ |
the Investor is a registrant pursuant to applicable Canadian securities laws; and/or |
|
________ |
the Investor is an insider of the Company pursuant to applicable Canadian securities laws. |
7. |
In furnishing the above information, the Investor, and if the Investor is an entity, the individual executing and delivering this questionnaire on behalf of the entity, acknowledge that the Company will be relying thereon in determining, among other things, whether there is reasonable grounds to believe that the Investor qualifies as a purchaser of shares of the Company's securities. To the best of the Investor's information and belief, the above information supplied by the Investor is true and correct in all respects and the Investor represents and warrants to the Company as follows: |
|
(a) |
The answers to the above questions may be relied upon by the Company in determining whether the offering in which the Investor proposes to participate is exempt from registration under the Act and from registration or qualification under the securities laws of various states. |
|
(b) |
The Investor will notify the Company immediately of any material change in any statement made herein occurring prior to the closing of any purchase by the Investor of securities of the Company. |
8. |
The Investor is able to bear the economic risk of the proposed investment and at the present time could afford a complete loss of such investment. |
A-8
DM3\5243217.4
IF INVESTOR IS AN ENTITY:
(Name of Entity - Please Print)
By:
Name
Title
IF INVESTOR IS ONE OR MORE
INDIVIDUALS (all individuals must sign)
(Name - Please Print)
Signature
Verification of status – for internal purposes {This will be completed by the relevant director, executive officer, control person or founder if the Subscriber is a person described in Parts B to E of paragraph 5(c) of this certificate. The Subscriber should leave this box blank.} |
|
The undersigned is {check the applicable boxes} ☐ a director, ☐ an executive officer or ☐ a control person of the Company or of an affiliate of the Company, or is ☐ a founder of the Company, and confirms that the Subscriber fits within the category of person which the Subscriber has indicated in this certificate. |
|
Name: |
|
Signature: |
|
Date: |
|
A-9
DM3\5243217.4
As used in this certificate, the following terms have the following meanings.
Affiliation: An issuer is an affiliate of another issuer if:
|
(a) |
one of them is the subsidiary of the other; or |
|
(b) |
each of them is controlled by the same person. |
“executive officer” means, for an issuer, an individual who is:
|
(a) |
a chair, vice-chair or president; |
|
(b) |
a vice-president in charge of a principal business unit, division or function including sales, finance or production; or |
(c)performing a policy-making function in respect of the issuer.
“founder” means, in respect of an issuer, a person who:
|
(a) |
acting alone, in conjunction, or in concert with one or more persons, directly or indirectly, takes the initiative in founding, organizing or substantially reorganizing the business of the issuer; and |
|
(b) |
at the time of the distribution or trade is actively involved in the business of the issuer. |
“spouse” means an individual who:
|
(a) |
is married to another individual and is not living separate and apart within the meaning of the Divorce Act (Canada), from the other individual; |
|
(b) |
is living with another individual in a marriage-like relationship, including a marriage-like relationship between individuals of the same gender; or |
|
(c) |
in Alberta, is an individual referred to in paragraph (a) or (b), or is an adult interdependent partner within the meaning of the Adult Interdependent Relationships Act (Alberta). |
“subsidiary” means an issuer that is controlled directly or indirectly by another issuer and includes a subsidiary of that subsidiary.
A-10
DM3\5243217.4
EXHIBIT “B”
CANADIAN ACCREDITED INVESTOR CERTIFICATE
TO BE COMPLETED ONLY IF (1) THE INVESTOR IS RESIDENT IN CANADA; AND (2) THE INVESTOR HAS COMPLETED 5(a) OF THE INVESTOR QUESTIONNAIRE.
(See Attached.)
DM3\5243217.4
cANADIAN ACCREDITED INVESTOR CERTIFICATE
TO:Paramount Gold Nevada Corp. (the “Company”)
In connection with the issuance by the Company of common stock and warrants to the undersigned, the undersigned hereby represents, warrants and certifies to the Company that:
1. |
the undersigned is an “Accredited Investor” as defined in NI 45-106 or section 73.3 of the Securities Act (Ontario), on the basis that the undersigned fits within the category of Accredited Investor which the undersigned has indicated below; and |
2. |
the undersigned was not created and is not being used solely to purchase or hold securities as an Accredited Investor described in paragraph (m) below. |
The undersigned has indicated below the categories which the undersigned satisfies in order to qualify as an “Accredited Investor” [Please initial or place a checkmark above the line to the left of each applicable item, complete the relevant information, if applicable, and sign this certificate].
_____ (a) |
a Schedule I, II or III bank, or a Canadian financial institution |
_____ (b) |
the Business Development Bank of Canada |
_____ (c) |
a subsidiary of any person referred to in paragraph (a) or (b), if the person owns all of the voting securities of the subsidiary, except the voting securities required by law to be owned by directors of that subsidiary |
_____ (d) |
a person registered under the securities legislation of a jurisdiction of Canada as an adviser or dealer |
|
_____ (e) |
an individual registered under the securities legislation of a jurisdiction of Canada as a representative of a person referred to in paragraph (d) |
_____ (e.1) |
an individual formerly registered under the securities legislation of a jurisdiction of Canada, other than an individual formerly registered solely as a representative of a limited market dealer under one or both of the Securities Act (Ontario) or the Securities Act (Newfoundland and Labrador) |
_____ (f) |
the Government of Canada or a jurisdiction of Canada, or any crown corporation, agency or wholly owned entity of the Government of Canada or a jurisdiction of Canada |
_____ (g) |
a municipality, public board or commission in Canada and a metropolitan community, school board, the Comité de gestion de la taxe scolaire de l’île de Montréal or an intermunicipal management board in Québec |
_____ (h) |
any national, federal, state, provincial, territorial or municipal government of or in any foreign jurisdiction, or any agency of that government |
_____ (i) |
a pension fund that is regulated by either the Office of the Superintendent of Financial Institutions (Canada) or a pension commission or similar regulatory authority of a jurisdiction of Canada |
B-1
DM3\5243217.4
{Note: Financial assets include cash and securities, but do not include a personal residence – see the definition of “financial assets” later in this certificate. Financial assets are generally liquid or relatively easy to liquidate. You must subtract any liabilities related to your financial assets to calculate your net financial assets—see the definition of “related liabilities”. Financial assets held in a group RRSP under which you do not have the ability to acquire the financial assets and deal with them directly are not considered to be beneficially owned by you. If you meet the higher financial asset threshold set out in paragraph (j.1), then initial paragraph (j.1) instead of this paragraph (j).}
{Note: If you are an accredited investor described in this paragraph (j), and do not meet the higher financial asset threshold set out in paragraph (j.1), you must deliver a completed Form 45-106F9 – Form for Individual Accredited Investors (Exhibit “C”).}
_____ (j.1) |
an individual who beneficially owns financial assets having an aggregate realizable value that, before taxes but net of any related liabilities, exceeds Cdn$5,000,000 |
{Note: The financial assets of your spouse (including financial assets in a spousal RRSP) cannot be included in the calculation of net financial assets under this paragraph (j.1).}
_____ (k) |
an individual whose net income before taxes exceeded Cdn$200,000 in each of the two most recent calendar years or whose net income before taxes combined with that of a spouse exceeded Cdn$300,000 in each of the two most recent calendar years and who, in either case, reasonably expects to exceed that net income level in the current calendar year |
{Note: If you are an accredited investor described in this paragraph (k), you must deliver a completed Form 45-106F9 – Form for Individual Accredited Investors (Exhibit “C”).}
_____ (l) |
an individual who, either alone or with a spouse, has net assets of at least Cdn$5,000,000 |
{Note: To calculate net assets, take the value of your total assets (which may include a personal residence) and subtract your total liabilities (which may include a mortgage). The value attributed to assets should reasonably reflect their estimated fair value. Income tax should be considered a liability if the obligation to pay it is outstanding at the time of the subscription.}
{Note: If you are an accredited investor described in this paragraph (l), you must deliver a completed Form 45-106F9 – Form for Individual Accredited Investors (Exhibit “C”).}
_____ (m) |
a person, other than an individual or investment fund, that has net assets of at least Cdn$5,000,000 as shown on its most recently prepared financial statements |
_____ (n) |
an investment fund that distributes or has distributed its securities only to: |
|
(i) |
a person that is or was an accredited investor at the time of the distribution; |
|
(ii) |
a person that acquires or acquired securities in the circumstances referred to in sections 2.10 (Minimum amount investment), or 2.19 (Additional investment in investment funds) of NI 45-106; or |
B-2
DM3\5243217.4
|
(iii) |
a person described in paragraph (i) or (ii) that acquires or acquired securities under section 2.18 (Investment fund reinvestment) of NI 45-106 |
_____ (o) |
an investment fund that distributes or has distributed securities under a prospectus in a jurisdiction of Canada for which the regulator or, in Québec, the securities regulatory authority, has issued a receipt |
_____ (p) |
a trust company or trust corporation registered or authorized to carry on business under the Trust and Loan Companies Act (Canada) or under comparable legislation in a jurisdiction of Canada or a foreign jurisdiction, acting on behalf of a fully managed account managed by the trust company or trust corporation, as the case may be |
_____ (q) |
a person acting on behalf of a fully managed account managed by that person, if that person is registered or authorized to carry on business as an adviser or the equivalent under the securities legislation of a jurisdiction of Canada or a foreign jurisdiction |
_____ (r) |
a registered charity under the Income Tax Act (Canada) that, in regard to the trade, has obtained advice from an eligibility adviser or an adviser registered under the securities legislation of the jurisdiction of the registered charity to give advice on the securities being traded |
_____ (s) |
an entity organized in a foreign jurisdiction that is analogous to any of the entities referred to in paragraphs (a) to (d) or paragraph (i) in form and function |
_____ (t) |
a person in respect of which all of the owners of interests, direct, indirect or beneficial, except the voting securities required by law to be owned by directors, are persons that are accredited investors |
{Note: If you have initialed this paragraph (t), name each owner of an interest, and indicate the category of accredited investor into which that person fits (by reference to the paragraph numbers in this Exhibit “B”). If a person named below is a director required by law to own a voting security, and that person is not an accredited investor, indicate “director” under Category.}
NameCategory
_____ (u) |
an investment fund that is advised by a person registered as an adviser or a person that is exempt from registration as an adviser |
_____ (v) |
a person that is recognized or designated by the securities regulatory authority or, except in Ontario and Québec, the regulator as an accredited investor |
B-3
DM3\5243217.4
{Note: If you have initialed this paragraph (w), name the person who established the trust and each trustee, and indicate the category of accredited investor into which that person fits (by reference to the paragraph numbers in this Exhibit “B”). If a person named below is not an accredited investor, indicate “N/A” under Category.}
NameCategory
Person who
established trust:
Trustee:
Trustee:
Trustee:
Dated this _________ day of June___, 2018.
If a trust, partnership or other entity: |
|
If an individual: |
|
|
|
Name of Entity
|
|
Signature |
Type of Entity |
|
Name of Individual |
Signature of Person Signing |
|
|
Title of Person Signing |
|
|
As used in this certificate, the following terms have the following meanings.
“Canadian financial institution” means:
(a) |
an association governed by the Cooperative Credit Associations Act (Canada) or a central cooperative credit society for which an order has been made under section 473(1) of that Act; and |
(b) |
in Ontario, also means a loan corporation, trust company, trust corporation, insurance company, treasury branch, credit union, caisse populaire, financial services cooperative or credit union league or federation that is authorized by a statute of Canada or Ontario to carry on business in Canada or Ontario, as the case may be; and |
(c) |
outside of Ontario, also means a loan corporation, trust company, trust corporation, insurance company, treasury branch, credit union, caisse populaire, financial services cooperative, or league |
B-4
DM3\5243217.4
that, in each case, is authorized by an enactment of Canada or a jurisdiction of Canada to carry on business in Canada or a jurisdiction of Canada. |
“eligibility adviser” means:
(a) |
a person that is registered as an investment dealer and authorized to give advice with respect to the type of security being distributed; and |
(b) |
in Manitoba, also means a lawyer who is a practicing member in good standing with a law society of a jurisdiction of Canada or a public accountant who is a member in good standing of an institute or association of chartered accountants, certified general accountants or certified management accountants in a jurisdiction of Canada provided that the lawyer or public accountant must not: |
|
(i) |
have a professional, business or personal relationship with the issuer, or any of its directors, executive officers, founders or control persons; and |
|
(ii) |
have acted for or been retained personally or otherwise as an employee, executive officer, director, associate or partner of a person that has acted for or been retained by the issuer or any of its directors, executive officers, founders or control persons within the previous 12 months. |
“executive officer” means, for an issuer, an individual who is:
(a) |
a chair, vice-chair or president; |
(b) |
a vice-president in charge of a principal business unit, division or function including sales, finance or production; or |
(c) |
performing a policy-making function in respect of the issuer. |
“financial assets” means:
(a) |
cash; |
(b) |
securities; or |
(c) |
a contract of insurance, a deposit or an evidence of a deposit that is not a security for the purposes of securities legislation. |
“foreign jurisdiction” means a country other than Canada or a political subdivision of a country other than Canada.
“founder” means, in respect of an issuer, a person who:
|
(a) |
acting alone, in conjunction, or in concert with one or more persons, directly or indirectly, takes the initiative in founding, organizing or substantially reorganizing the business of the issuer; and |
|
(b) |
at the time of the distribution or trade is actively involved in the business of the issuer. |
“fully managed account” means an account of a client for which a person makes the investment decisions if that person has full discretion to trade in securities for the account without requiring the client’s express consent to a transaction.
“investment fund” has the same meaning as in National Instrument 81-106 — Investment Fund Continuous Disclosure and means a mutual fund or a non-redeemable investment fund.
B-5
DM3\5243217.4
“jurisdiction of Canada” means a province or territory of Canada.
“non-redeemable investment fund” means an issuer:
(a) |
whose primary purpose is to invest money provided by its securityholders; |
(b) |
that does not invest: |
|
(i) |
for the purpose of exercising or seeking to exercise control of an issuer, other than an issuer that is a mutual fund or a non-redeemable investment fund; or |
|
(ii) |
for the purpose of being actively involved in the management of any issuer in which it invests, other than an issuer that is a mutual fund or a non-redeemable investment fund; and |
(c) |
that is not a mutual fund. |
“person” includes:
(a) |
an individual; |
(b) |
a corporation; |
(c) |
a partnership, trust, fund and an association, syndicate, organization or other organized group of persons, whether incorporated or not; and |
(d) |
an individual or other person in that person’s capacity as a trustee, executor, administrator or personal or other legal representative. |
“related liabilities” means:
(a) |
liabilities incurred or assumed for the purpose of financing the acquisition or ownership of financial assets; or |
(b) |
liabilities that are secured by financial assets. |
“spouse” means an individual who:
(a) |
is married to another individual and is not living separate and apart within the meaning of the Divorce Act (Canada), from the other individual; |
(b) |
is living with another individual in a marriage-like relationship, including a marriage-like relationship between individuals of the same gender; or |
(c) |
in Alberta, is an individual referred to in paragraph (a) or (b), or is an adult interdependent partner within the meaning of the Adult Interdependent Relationships Act (Alberta). |
“subsidiary” means an issuer that is controlled directly or indirectly by another issuer and includes a subsidiary of that subsidiary.
B-6
DM3\5243217.4
THIS EXHIBIT “C” MUST BE COMPLETED IF THE INVESTOR:
• |
IS SUBSCRIBING UNDER THE “ACCREDITED INVESTOR” EXEMPTION SET OUT IN SECTION 3.1 OF THE AGREEMENT TO WHICH THIS EXHIBIT “C” IS ATTACHED; |
• |
IS AN INDIVIDUAL DESCRIBED IN CATEGORY (j), (k) OR (l) OF THE CANADIAN ACCREDITED INVESTOR CERTIFICATE (EXHIBIT “B”); AND |
• |
DOES NOT MEET THE HIGHER FINANCIAL ASSET THRESHOLD SET OUT IN PARAGRAPH (j.1) OF THE CANADIAN ACCREDITED INVESTOR CERTIFICATE. |
FORM 45-106F9
FORM FOR INDIVIDUAL ACCREDITED INVESTORS
Warning! This investment is risky. Don’t invest unless you can afford to lose all the money you pay for this investment. |
SECTION 1 TO BE COMPLETED BY THE ISSUER OR SELLING SECURITY HOLDER |
||||
1. About your investment |
||||
Type of securities: Units |
Issuer: Paramount Gold Nevada Corp. |
|||
Purchased from: Paramount Gold Nevada Corp. |
||||
SECTIONS 2 TO 4 TO BE COMPLETED BY THE PURCHASER |
||||
2. Risk acknowledgement |
||||
This investment is risky. Initial that you understand that: |
Your initials |
|||
Risk of loss – You could lose your entire investment of $_____________________. (Instruction: Insert the total dollar amount of the investment.) |
|
|||
Liquidity risk – You may not be able to sell your investment quickly – or at all. |
|
|||
Lack of Information – You may receive little or no information about your investment. |
|
|||
Lack of advice – You will not receive advice from the salesperson about whether this investment is suitable for you unless the salesperson is registered. The salesperson is the person who meets with, or provides information to, you about making this investment. To check whether the salesperson is registered, go to www.aretheyregistered.ca. |
|
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DM3\5243217.4
You must meet at least one of the following criteria to be able to make this investment. Initial the statement that applies to you. (You may initial more than one statement.) The person identified in section 6 is responsible for ensuring that you meet the definition of accredited investor. That person, or the salesperson identified in section 5, can help you if you have questions about whether you meet these criteria. |
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•Your net income before taxes was more than Cdn$200,000 in each of the 2 most recent calendar years, and you expect it to be more than Cdn$200,000 in the current calendar year. (You can find your net income before taxes on your personal income tax return.) |
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•Your net income before taxes combined with your spouse’s was more than Cdn$300,000 in each of the 2 most recent calendar years, and you expect your combined net income before taxes to be more than Cdn$300,000 in the current calendar year. |
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•Either alone or with your spouse, you own more than Cdn$1 million in cash and securities, after subtracting any debt related to the cash and securities. |
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•Either alone or with your spouse, you have net assets worth more than Cdn$5 million. (Your net assets are your total assets (including real estate) minus your total debt.) |
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4. Your name and signature |
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By signing this form, you confirm that you have read this form and you understand the risks of making this investment as identified in this form. |
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First and last name (please print): |
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Signature: |
Date: |
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SECTION 5 TO BE COMPLETED BY THE SALESPERSON |
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5. Salesperson information |
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(Instruction: The salesperson is the person who meets with, or provides information to, the purchaser with respect to making this investment. That could include a representative of the issuer or selling security holder, a registrant or a person who is exempt from the registration requirement.) |
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First and last name of salesperson (please print): |
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Telephone: |
Email: |
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Name of firm (if registered): |
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SECTION 6 TO BE COMPLETED BY THE ISSUER OR SELLING SECURITY HOLDER |
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6. For more information about this investment |
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Paramount Gold Nevada Corp. 65 Anderson Street, Winnemucca, Nevada 89445 Attention: Carlo Buffone, Chief Financial Officer Website: www.paramountnevada.com
For more information about prospectus exemptions, contact your local securities regulator. You can find contact information at www.securities-administrators.ca. |
(The Investor should keep one copy of this form (signed by the Investor) for the Investor’s records.)
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DM3\5243217.4
THIS EXHIBIT “D” IS IN THE FORM REQUIRED UNDER APPLICABLE SECURITIES LAWS AND MUST BE COMPLETED IF THE INVESTOR IS RESIDENT IN THE PROVINCE OF ONTARIO AND THE INVESTOR IS SUBSCRIBING UNDER THE “FAMILY, FRIENDS AND BUSINESS ASSOCIATES” EXEMPTION.
FORM 45‑106F12
ONTARIO RISK ACKNOWLEDGEMENT FORM FOR FAMILY, FRIEND AND BUSINESS ASSOCIATE INVESTORS
Warning! This investment is risky. Don’t invest unless you can afford to lose |
SECTION 1 TO BE COMPLETED BY THE ISSUER |
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1. About your investment |
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Type of securities: Units |
Issuer: Paramount Gold Nevada Corp. |
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SECTIONS 2 TO 4 TO BE COMPLETED BY THE PURCHASER |
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2. Risk acknowledgement |
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This investment is risky. Initial that you understand that: |
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Risk of loss – You could lose your entire investment of $_____________________. {Instruction: Insert the total dollar amount of the investment.} |
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Liquidity risk – You may not be able to sell your investment quickly – or at all. |
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Lack of Information – You may receive little or no information about your investment. The information you receive may be limited to the information provided to you by the family member, friend or close business associate specified in Section 3 of this form. |
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3. Family, Friends or Business Associate Status |
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You must meet one of the following criteria to be able to make this investment. Initial the statement that applies to you. |
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A) You are: |
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1.[check all applicable boxes] [ ]a director of the issuer or an affiliate of the issuer [ ]an executive officer of the issuer or an affiliate of the issuer [ ]a control person of the issuer or an affiliate of the issuer [ ]a founder of the issuer OR |
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2.[check all applicable boxes] [ ]a person of which a majority of the voting securities are beneficially owned by, or a majority of the directors are, (i) individuals listed in (1) above and/or (ii) family members, close personal friends or close business associates of individuals listed in (1) above [ ]a trust or estate of which all of the beneficiaries or a majority of the trustees or executors are (i) individuals listed in (1) above and/or (ii) family members, close personal friends or close business associates of individuals listed in (1) above |
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DM3\5243217.4
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DM3\5243217.4
6. For more information about this investment |
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Paramount Gold Nevada Corp. 65 Anderson Street, Winnemucca, Nevada 89445 Attention: Carlo Buffone, Chief Financial Officer For more information about prospectus exemptions, contact your local securities regulator. You can find contact information at www.securities‑administrators.ca. |
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Signature of executive officer of the issuer (other than the purchaser):
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Date: |
(The Investor, contact person at the issuer and the issuer must receive a copy of the form signed by the Investor.)
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DM3\5243217.4
EXHIBIT “E”
CONTACT INFORMATION
Alberta Securities Commission Suite 600, 250—5th Street SW Calgary, Alberta T2P 0R4 Telephone: (403) 297-6454 Toll free in Canada: 1-877-355-0585 Facsimile: (403) 297-2082 |
British Columbia Securities Commission P.O. Box 10142, Pacific Centre 701 West Georgia Street Vancouver, British Columbia V7Y 1L2 Inquiries: (604) 899-6854 Toll free in Canada: 1-800-373-6393 Facsimile: (604) 899-6581 Email: FOI-privacy@bcsc.bc.ca |
The Manitoba Securities Commission 500-400 St. Mary Avenue Winnipeg, Manitoba R3C 4K5 Telephone: (204) 945-2561 Toll free in Manitoba: 1-800-655-5244 Facsimile: (204) 945-0330 |
Financial and Consumer Services Commission (New Brunswick) 85 Charlotte Street, Suite 300 Saint John, New Brunswick E2L 2J2 Telephone: (506) 658-3060 Toll free in Canada: 1-866-933-2222 Facsimile: (506) 658-3059 Email: info@fcnb.ca |
Government of Newfoundland and Labrador P.O. Box 8700 Confederation Building 2nd Floor, West Block Prince Philip Drive St. John’s, Newfoundland and Labrador A1B 4J6 Attention: Director of Securities Telephone: (709) 729-4189 Facsimile: (709) 729-6187 |
Government of the Northwest Territories Office of the Superintendent of Securities P.O. Box 1320 Yellowknife, Northwest Territories X1A 2L9 Telephone: (867) 767-9305 Facsimile: (867) 873-0243 |
Nova Scotia Securities Commission Suite 400, 5251 Duke Street Duke Tower P.O. Box 458 Halifax, Nova Scotia B3J 2P8 Telephone: (902) 424-7768 |
Government of Nunavut Department of Justice Legal Registries Division P.O. Box 1000, Station 570 1st Floor, Brown Building Iqaluit, Nunavut X0A 0H0 Telephone: (867) 975-6590 Facsimile: (867) 975-6594 |
DM3\5243217.5
20 Queen Street West, 22nd Floor Toronto, Ontario M5H 3S8 Telephone: (416) 593-8314 Toll free in Canada: 1-877-785-1555 Facsimile: (416) 593-8122 Email: exemptmarketfilings@osc.gov.on.ca Public official contact regarding indirect collection of information: Inquiries Officer |
Prince Edward Island Securities Office 95 Rochford Street, 4th Floor Shaw Building P.O. Box 2000 Charlottetown, Prince Edward Island C1A 7N8 Telephone: (902) 368-4569 Facsimile: (902) 368-5283 |
Autorité des marchés financiers 800, Square Victoria, 22e étage C.P. 246, Tour de la Bourse Montréal, Québec H4Z 1G3 Telephone: (514) 395-0337 or 1-877-525-0337 Facsimile: (514) 873-6155 (For filing purposes only) Facsimile: (514) 864-6381 (For privacy requests only) Email: financementdessocietes@lautorite.qc.ca (For corporate finance issuers); fonds_dinvestissement@lautorite.qc.ca (For investment fund issuers) Public official contact regarding indirect collection of information: Secrétaire générale |
Financial and Consumer Affairs Authority of Saskatchewan Suite 601—1919 Saskatchewan Drive Regina, Saskatchewan S4P 4H2 Telephone: (306) 787-5842 Facsimile: (306) 787-5899 |
Government of Yukon Department of Community Services Office of the Superintendent of Securities 307 Black Street Whitehorse, Yukon Y1A 2N1 Telephone: (867) 667-5466 Facsimile: (867) 393-6251 Email: securities@gov.yk.ca Public official contact regarding indirect collection of information: Superintendent of Securities |
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DM3\5243217.5
Exhibit 99.1
Paramount gold NEVADA Announces $3 Million private placement with proceeds to advance PERMITTING AT grassy mountain
Winnemucca, Nevada – June 25, 2018 - Paramount Gold Nevada Corp. (NYSE American: PZG) ("Paramount” or “the Company”) announced today that the Company has received commitments from accredited investors to purchase common stock and warrants in a private transaction (the “Transaction”). Under the terms of the Transaction, Paramount has agreed to sell 2,400,000 units at $1.25 per unit for aggregate proceeds of $3,000,000. Each unit consists of one share of common stock and one warrant to purchase one-half of a share of common stock. Each warrant will have a two-year term and will be exercisable in the first year at $1.30 per share and in the second year at $1.50 per share. The closing of the Transaction is anticipated to occur on or about July 6, 2018 subject only to the satisfaction of customary closing conditions. There are no commissions to be paid in connection with the Transaction.
FCMI Parent Co. and Seabridge Gold Inc. (NYSE: SA) (TSX: SEA), Paramount’s two largest stockholders have subscribed for 380,000 units and 308,000 units respectively, both maintaining their current percentage ownership.
Proceeds from the Transaction will be used primarily to advance the mine permitting process for the proposed underground mine at Grassy Mountain. Other uses of proceeds will include an exploration program of several high priority targets which are in close proximity to Grassy Mountain and for general corporate purposes.
In connection with the Transaction, the Company has agreed to use its best efforts to file a registration statement with the U.S. Securities and Exchange Commission to register the resale of the shares of common stock issued at closing of the Transaction and the shares issued upon exercise of the warrants.
This press release shall not constitute an offer to sell or the solicitation of an offer to buy securities. The securities offered and sold in the Transaction have not been registered under the United States Securities Act of 1933, as amended (the “Securities Act”), or any state securities laws, and may not be offered or sold in the United States absent registration, or an applicable exemption from registration under the Securities Act and applicable state securities laws.
About Paramount Gold Nevada Corp.
Paramount Gold Nevada is a U.S. based precious metals exploration and development company. Paramount’s strategy is to create shareholder value through exploring and developing its mineral properties and to realize this value for its shareholders in three ways: by selling its assets to established producers; entering into joint ventures with producers for construction and operation; or constructing and operating mines for its own account.
Paramount owns 100% of the Grassy Mountain Gold Project which consists of approximately 9,300 acres located on private and BLM land in Malheur County, Oregon. The Grassy Mountain project contains a gold-silver deposit (100% located on private land). Additionally, Paramount owns a 100% interest in the Sleeper Gold Project located in Northern Nevada. The Sleeper Gold Project, which includes the former producing Sleeper mine, totals 2,322 unpatented mining claims (approximately 60 square miles or 15,500 hectares).
Safe Harbor for Forward-Looking Statements
This release and related documents may include "forward-looking statements" and “forward-looking information” (collectively, “forward-looking statements”) pursuant to applicable United States and Canadian securities laws. Paramount’s future expectations, beliefs, goals, plans or prospects constitute forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995 and other applicable securities laws. Words such as "believes," "plans,"
Exhibit 99.1
"anticipates," "expects," "estimates" and similar expressions are intended to identify forward-looking statements, although these words may not be present in all forward-looking statements. Forward-looking statements included in this news release include, without limitation, statements with respect to future events or future performance; anticipated exploration, development, permitting and other activities on the Grassy Mountain project; the economics of the Grassy Mountain project, including the potential for improving project economics and finding more ore to extend mine life. Forward-looking statements are based on the reasonable assumptions, estimates, analyses and opinions of management made in light of its experience and its perception of trends, current conditions and expected developments, as well as other factors that management believes to be relevant and reasonable in the circumstances at the date that such statements are made, but which may prove to be incorrect. Management believes that the assumptions and expectations reflected in such forward-looking statements are reasonable. Assumptions have been made regarding, among other things: Paramount’s ability to carry on exploration and development activities, including construction; the timely receipt of required approvals and permits; the price of silver, gold and other metals; prices for key mining supplies, including labor costs and consumables, remaining consistent with current expectations; work meeting expectations and being consistent with estimates and plant, equipment and processes operating as anticipated. There are a number of important factors that could cause actual results or events to differ materially from those indicated by such forward-looking statements, including, but not limited to: uncertainties involving interpretation of drilling results; environmental matters; the ability to obtain required permitting; equipment breakdown or disruptions; additional financing requirements; the completion of a definitive feasibility study for the Grassy Mountain project; discrepancies between actual and estimated mineral reserves and mineral resources, between actual and estimated development and operating costs and between estimated and actual production; and the other factors described in Paramount’s disclosures as filed with the SEC and the Ontario, British Columbia and Alberta Securities Commissions.
Except as required by applicable law, Paramount disclaims any intention or obligation to update any forward-looking statements as a result of developments occurring after the date of this document.
Paramount Gold Nevada Corp.
Glen Van Treek, President, CEO and Director
Christos Theodossiou, Director of Corporate Communications
866-481-2233