MICROMEM
      TECHNOLOGIES INC.

    


    SUBSCRIPTION
      AGREEMENT FOR UNITS

    


    
      	TO:	
              MICROMEM
                TECHNOLOGIES INC.

            


    

    


    1. Subscription

    


    The
      undersigned (the "Purchaser") hereby irrevocably subscribes for and agrees
      to
      purchase (the "Subscription Agreement"), on and subject to the terms and
      conditions set forth herein from Micromem Technologies Inc. (the
      "Corporation") such number of units of the Corporation (a "First Unit") as
      set
      forth in section 24 hereof (collectively the "Purchased Units") at a price
      of
      US$0.60 per First Unit (the "Subscription Price"). 

    


    2. Description
      of First Units

    


    Each
      First Unit shall consist of one common share of the Corporation (a "Common
      Share") and one warrant (a "First Warrant") each First Warrant exercisable
      for
      one unit (a "Second Unit") at a price of US$0.60 per Second Unit at any time
      during the 12 months following the date of issuance of the First Warrants.
      Each
      Second Unit shall consist of one Common Share (a "First Warrant Share") and
      one
      warrant (a "Second Warrant"), each Second Warrant exercisable for one Common
      Share (a "Second Warrant Share") at a price of US$0.60 per Second Warrant Share
      at any time during the period extending 24 months following the issuance of
      the
      First Unit to such Purchaser. Hereinafter a First Warrant and a Second Warrant
      may collectively be referred to as a "Warrant" and a First Warrant Share and
      a
      Second Warrant Share may collectively be referred to as a "Warrant
      Share".

    


    3. Payment

    


    The
      aggregate amount payable by the Purchaser in respect of the Purchased Units
      shall be paid on the Closing Date and shall be made by certified cheque, wire
      transfer or bank draft drawn on a Canadian chartered bank, and payable to the
      Corporation or payable in such other manner as may be specified by the
      Corporation. 

    


    All
      dollar amounts referred to herein are US dollars.

    


    4. Conditions
      of Closing

    


    The
      Purchaser must complete, sign and return one executed copy of this Subscription
      Agreement to the Corporation as soon as possible, and, in any event, no later
      than 12:00 noon (Toronto time) on ________, 200_ or such other time, date and/or
      place as the Corporation may advise.

    


    
      
         

      

      
         

        
          

        

      

      
         

      

    

    As
      a
      condition of Closing (as hereinafter defined), the Corporation must obtain
      any
      necessary approvals from all appropriate regulatory bodies in respect of the
      issue of the First Units. The Purchaser agrees to promptly execute and deliver
      all such documents and other instruments as any such regulatory body may
      require.

    


    In
      addition, the Purchaser shall agree to provide all other documentation, if
      any,
      required by the securities laws of the jurisdiction which the Purchaser is
      resident.

    


    If
      any
      regulatory body objects to the subscription by the Purchaser for the Purchased
      Units, the Corporation may, in its sole and absolute discretion, terminate
      this
      Subscription Agreement by providing written notice to the Purchaser of the
      Corporation's intention to do so and returning the Purchaser's subscription
      funds, and, upon providing such written notice, the Corporation will be released
      from any further obligations hereunder including, without limiting the
      generality of this foregoing, the obligation to issue the Purchased Units to
      the
      Purchaser.

    


    5. Facsimiled
      Subscriptions

    


    The
      Corporation will be entitled to rely on delivery by facsimile of an executed
      copy of this Subscription Agreement, and acceptance by the Corporation of such
      facsimile copy will be legally effective to create a valid and binding agreement
      between the Purchaser and the Corporation in accordance with the terms
      hereof.

    


    6. Closing

    


    Delivery
      and payment for the First Units will be completed (the "Closing") at the offices
      of the Corporation in Toronto, Ontario at 10:00 a.m. (Toronto time) (the
      "Closing Time") on or before _________, 200_ (the "Closing Date") or such
      earlier or later dates or times as the Corporation and the Purchaser may agree.
      This executed Subscription Agreement is open for acceptance in whole or in
      part
      by the Corporation at any time prior to the Closing Time. Confirmation of
      acceptance or rejection of a subscription will be forwarded to the Purchaser
      by
      the Corporation promptly after acceptance or rejection has been made. If this
      subscription is rejected in whole and if the Purchaser has delivered a certified
      cheque or bank draft representing the Subscription Price for the Purchased
      Units, then such cheque or bank draft will be promptly returned to the Purchaser
      without interest. If this subscription is accepted only in part and the
      Purchaser has delivered a certified cheque or bank draft as aforesaid, a cheque
      representing the portion of the Subscription Price for that portion of the
      Purchaser’s subscription for First Units which is not accepted will be promptly
      returned to the Purchaser without interest.

    


    Certificates
      for the securities comprising the First Units will be available for delivery
      against payment of the aggregate Subscription Price for the First Units by
      the
      Purchaser in freely tradable US funds. 

    


    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    7. Prospectus
      Exemptions

    


    The
      Purchaser (on his or its own behalf or on behalf of others for whom he or it
      is
      contracting hereunder), acknowledges and agrees that the sale and delivery
      of
      the Purchased Units to the Purchaser (or to others for whom he or it is
      contracting hereunder) is conditional upon such sale being exempt from the
      requirements under applicable securities legislation requiring the filing of
      a
      prospectus in connection with the distribution of the First Units or the
      delivery of an offering memorandum (as defined in the applicable securities
      legislation), or upon the issuance of such rulings, orders, consents or
      approvals as may be required to permit such sale without the requirement of
      filing a prospectus or delivering an offering memorandum.

    


    The
      Purchaser (on
      his
      or its own behalf or on behalf of others for whom he or it is contracting
      hereunder)
      acknowledges and agrees that:

    


    
      	
              (a)

            	
              the
                Purchaser (or others for whom he or it is contracting hereunder)
                has not
                received, nor has he or it requested, nor does it have any need to
                receive, a prospectus or any offering memorandum, or any other document
                (other than financial statements, interim financial statements or
                any
                other document, the content of which is prescribed by statute or
                regulation) describing the business and affairs of the Corporation
                which
                has been prepared for delivery to, and reviewed by, prospective purchasers
                in order to assist he or it in making an investment decision in respect
                of
                the Purchased Units;

            


    

    


    
      	
              (b)

            	
              the
                Purchaser’s decision to execute this Subscription Agreement and purchase
                the Purchased Units (on
                his or its own behalf or on behalf of others for whom he or it is
                contracting hereunder)
                has not been based upon any verbal or written representations as
                to fact
                or otherwise made by or on behalf of the Corporation and that its
                decision
                (or the decision of others for whom it is contracting hereunder)
                is based
                entirely upon information concerning the Corporation contained in
                documents the content of which is prescribed by statute or
                regulation;

            


    

    


    
      	
              (c)

            	
              the
                sale of the Purchased Units was not accompanied by any advertisement
                in
                printed media of general and regular paid circulation, radio, television,
                the Internet or any other form of electronic media;
                and

            


    

    


    
      	
              (d)

            	
              the
                Purchaser (or others for whom he or it is contracting hereunder)
                has been
                advised to consult its own legal advisors with respect to trading
                in the
                securities comprising the First Units and to resale restrictions
                imposed
                by applicable securities legislation in the jurisdiction in which
                it
                resides, that no representation has been made respecting the applicable
                hold periods or other resale restrictions applicable to such securities,
                that the Purchaser (or others for whom he or it is contracting hereunder)
                is solely responsible (and the Corporation is not in any way responsible)
                for compliance with applicable resale restrictions and that the Purchaser
                is aware that he or it (or others for whom he or it is contracting
                hereunder) may not be able to resell such securities except in accordance
                with limited exemptions under applicable securities legislation and
                regulatory policy.

            


    

    


    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    The
      Purchaser understands that all certificates representing the Purchased Units
      and
      all certificates issued in exchange therefor or in substitution or transfer
      thereof shall bear a legend respecting restrictions on transfer as required
      under applicable securities laws.

    


    The
      Purchaser agrees that the Corporation may be required by law or otherwise to
      disclose to regulatory authorities the identity of the Purchaser and each
      beneficial purchaser of First Units for whom the Purchaser may be
      acting.

    


    8. Representations,
      Warranties and Covenants of the Purchaser

    


    The
      Purchaser hereby represents, warrants and covenants to the Corporation (on
      his
      or its own behalf and, if applicable, on behalf of those for whom the Purchaser
      is contracting hereunder) to and with the Corporation (which representations,
      warranties and covenants shall survive Closing), and acknowledges that the
      Corporation is relying upon such representations, warranties and covenants
      in
      issuing the Purchased Units, that:

    


    
      	(a)	
              if
                the Purchaser is a resident of the Province of Ontario, the
                Purchaser:

            


    

     

    
      	 	
              (i)

            	
              in
                the case of a purchase by the Purchaser of the Purchased Units as
                principal for its own account and not for the benefit of any other
                person,
                the Purchaser is purchasing the Purchased Units as principal for
                its own
                account, and not for the benefit of any other person or company,
                for
                investment purposes only and not with a view to the resale or distribution
                of all or any of the Purchased Units, and this Subscription Agreement has
                been authorized, executed and delivered by, and constitutes a legal,
                valid
                and binding agreement of the undersigned,
                and:

            


    

    


    
      	 	 	
              (A)

            	
              the
                Purchaser qualifies and is purchasing as an "accredited investor",
                as such
                term is defined in Ontario Securities Commission Rule 45-501 (if
                subject
                to the securities legislation of the province of
                Ontario);

            


    

     

    
      	 	
              (ii)

            	
              in
                the case of the purchase by the Purchaser of the Purchased Units
                as agent
                for a disclosed principal, each beneficial purchaser of the Purchased
                Units for whom the Purchaser is acting is purchasing as principal
                for its
                own account and not for the benefit of any other person; the Purchaser
                is
                an agent with due and proper authority to execute this Subscription
                Agreement and all other documentation in connection with the purchase
                of
                the Purchased Units on behalf of the beneficial purchaser; and this
                Subscription Agreement has been duly authorized, executed and delivered
                by
                or on behalf of, and constitutes the legal, valid and binding agreement
                of, the disclosed principal; and the beneficial
                purchaser:

            


    

    


    
      	 	 	
              (A)

            	
              is
                an “accredited investor”, as such term is defined in Ontario Securities
                Commission Rule 45-501 (if subject to the securities legislation
                of the
                province of Ontario); 

            


    

    


    
      
         

      

      
        4

        
          

        

      

      
         

      

    

    
      	 	
              (iii)

            	
              in
                the case of the purchase by the Purchaser of the Purchased Units
                as
                trustee or as agent or as portfolio manager or portfolio advisor
                (as such
                terms are defined under applicable securities laws) for a principal
                which
                is undisclosed or identified by account number only, this Subscription
                Agreement has been duly authorized, executed and delivered by, and
                constitutes a legal, valid and binding agreement of, the undersigned
                acting in such capacity, and:

            


    

     

    
      	 	 	
              (A)

            	
              the
                beneficial purchaser of the Purchased Units for whom the Purchaser
                is
                acting is an individual or corporation and is purchasing as principal
                for
                its own account, and not for the benefit of any other person,
                and

            


    

    


    
      	 	 	 	
              (I)

            	
              is
                an "accredited investor", as such term is defined in Ontario Securities
                Commission Rule 45-501 (if subject to the securities legislation
                of the
                province of Ontario), or as such term is defined in Multilateral
                Instrument 45-103 (if subject to the securities legislation of the
                Province of Alberta); 

            


    

     

    and
      the
      Purchaser is a trustee or agent with due and proper authority to execute this
      agreement and all other documentation in connection with the subscription and
      purchase of the Purchased Units on behalf of the beneficial
      purchaser;

    


    
      	
              (b)

            	
              if
                the Purchaser is resident of the Province of Ontario, the Purchaser
                has
                duly completed and signed the Certificate of Ontario Accredited Investor
                in the form attached hereto as Schedule I (if subject to the securities
                legislation of the province of Ontario) and the contents of the applicable
                questionnaire are true and correct as of the date hereof and will
                be true
                and correct as of the date of the issue and sale of the Purchased
                Units.

            


    

    


    
      	
              (c)

            	
              the
                Purchaser has such knowledge and experience in financial and business
                matters as to be capable of evaluating the merits and risks of an
                investment in the First Units and that he or it is able to bear the
                economic risk of such investment for an indefinite period of time.
                The
                Purchaser is purchasing the Purchased Units for the Purchaser’s own
                account, for investment purposes only and not with a view to any
                resale or
                distribution thereof and the Purchaser does not have any contracts,
                understandings, agreements or arrangements with any person or entity
                to
                sell, transfer or grant a participation interest with respect to
                any of
                the Purchased Units;

            


    

    


    (d) if
      the
      Purchaser is a resident of a jurisdiction other than Canada, the Purchaser
      hereby represents and warrants to the Corporation as follows, such
      representations and warranties to survive the Purchaser's purchase of the
      Purchased Units:

    


    
      
         

      

      
        5

        
          

        

      

      
         

      

    

    (1) If
      a
      natural person, the Purchaser is: a bona fide resident of the state set forth
      on
      the signature page of this Subscription Agreement as the home address of such
      Purchaser; over 21 years of age; and legally competent to execute this
      Subscription Agreement and to carry out his obligations hereunder and thereunder
      in accordance with the terms and provisions hereof and thereof. If an entity,
      the Purchaser has full power and authority to execute and deliver this
      Subscription Agreement and to carry out its obligations hereunder and thereunder
      in accordance with the terms and provisions hereof and thereof; and the
      execution, delivery and performance of this Subscription Agreement and the
      consummation of the transactions contemplated hereby and thereby have been
      duly
      authorized by all requisite corporate or other necessary action on the part
      of
      the Purchaser.

    


    (2) This
      Subscription Agreement constitutes a valid and legally binding obligation of
      the
      Purchaser, enforceable against the Purchaser in accordance with its terms,
      except as enforceability may be limited by bankruptcy, insolvency,
      reorganization and other similar laws now or hereafter in effect relating to
      creditors' rights generally.

    


    (3) The
      execution, delivery and performance by the Purchaser of this Subscription
      Agreement and the transactions contemplated hereby will not constitute a breach
      of any term or provision of, or a default under, (i) any outstanding indenture,
      mortgage, loan agreement or other similar contract or agreement to which the
      Purchaser or any of the Purchaser's affiliates is a party or by which the
      Purchaser or any such affiliate or its or their property is bound, (ii) if
      the
      Purchaser is a corporation or other legal entity, its certificate or articles
      of
      incorporation or by-laws or other constituent documents, (iii) any law, rule
      or
      regulation, or (iv) any order, writ, judgment or decree having applicability
      to
      it.

    


    (4) No
      consent, license, approval or authorization of any governmental body, authority,
      bureau or agency is required on the part of the Purchaser or any of the
      Purchaser's affiliates in connection with the execution, delivery and
      performance of this Subscription Agreement or the consummation of the
      transactions contemplated hereby.

    


    (5) The
      Purchaser has received all other materials relating to the Corporation, the
      terms and conditions of the offering and any other matters relating to the
      offering which the Purchaser has requested. The Purchaser has had the
      opportunity to ask questions of representatives of the Corporation concerning
      the finances, operations, business and prospects of the Corporation, and the
      Corporation has answered all inquiries that the Purchaser or his or her
      representatives have put to it relating to such matters and the offering.


    


    (6) 
      The
      Purchaser has such knowledge and experience in finance, securities, investments
      and other business matters so as to be able to protect his interests in
      connection with this transaction, and his investment in the Corporation is
      not
      material when compared to his total financial capacity.

    


    
      
         

      

      
        6

        
          

        

      

      
         

      

    

    (7) The
      Purchaser understands the various risks of an investment in the Corporation
      and
      can afford to bear such risks, including, but not limited to, the risks of
      losing his entire investment. The Purchaser is aware that the purchase of the
      Purchased Units is a speculative investment involving a high degree of risk
      and
      that there is no guarantee that the Purchaser will realize any gain from this
      investment, and that the Purchaser could lose the total amount of the
      Subscriber's investment. 

    


    (8) The
      Purchaser has no need for liquidity of his investment in the Corporation and
      can
      afford to hold the Purchased Units(s) for which he has subscribed for a
      substantial period of time.

    


    (9) The
      Purchaser is fully aware that an investment in the Corporation involves
      significant risks which he may have to bear for an indefinite period of time
      because the Purchased Units have not been registered under the Securities Act
      of
      1933 (the "33 Act") or under the securities laws of any state and, therefore,
      cannot be resold unless they are subsequently so registered or an exemption
      from
      such registration is available and he is acquiring the Purchased Units for
      investment and not with a view to resale or distribution thereof.

    


    (10) The
      Purchaser qualifies as an “Accredited Investor” as that term is defined in
      Section 501(a) of Regulation D promulgated under the 33 Act. The Purchaser
      acknowledges that it has such knowledge and experience in financial and business
      matters that it is capable of evaluating the merits and risks of making an
      investment in the Corporation.

    


    (11) The
      Purchaser understands that the Purchased Units are being offered and sold under
      an exemption from registration provided for in Regulation D promulgated under
      Section 4(2) of the 33 Act and under similar exemption under certain state
      securities laws, and that this transaction has not been reviewed by, passed
      on
      or submitted to any federal or state agency or self-regulatory organization
      where an exemption is being relied upon.

    


    (12) The
      First
      Units hereby subscribed for will be acquired by the Purchaser for his own
      account (or, if the Purchaser is a natural person, for the account of such
      natural person and his spouse either in joint tenancy, tenancy by the entirety
      or tenancy in common), for investment and not with a view to the distribution
      thereof.

    


    (13) the
      Purchaser (A) will not sell or otherwise dispose of the Purchased Units or
      the
      Warrant Shares, except in accordance with applicable Canadian and US securities
      laws; and (B) if the Purchaser sells or otherwise disposes of the Purchased
      Units or the Warrant Shares to a person other than a resident of Canada during
      the period referred to herein, such person covenants to obtain from such
      purchaser a covenant as provided for herein and the Corporation shall have
      no
      obligation to register any purported sale or disposition in violation of this
      Subscription Agreement and any such sale or disposition shall be null and void
      and of no further force and effect;

    


    
      
         

      

      
        7

        
          

        

      

      
         

      

    

    
      	
              (f)

            	
              as
                the Purchased Units are subject to resale restrictions under applicable
                Canadian provincial and US securities legislation and may be subject
                to
                the securities legislation of any other jurisdiction in which the
                Purchaser resides, the Purchaser shall comply with all relevant securities
                legislation concerning any resale of the Purchased Units (and the
                Corporation is not in any way responsible for such compliance) and
                shall
                consult with his or its own legal advisors with respect to such
                compliance. The Purchaser understands and agrees that the certificates
                evidencing the Purchased Units will bear an appropriate legend evidencing
                the restricted nature of the First
                Units;

            


    

    


    
      	
              (g)

            	
              the
                Purchaser will execute and deliver within the applicable time periods
                all
                documentation as may be required by applicable Canadian and US securities
                legislation, regulations, rules and policies to permit the purchase
                of the
                Purchased Units on the terms herein set
                forth;

            


    

    


    
      	
              (h)

            	
              if
                required by applicable securities legislation, policy or order of a
                securities regulatory authority, stock exchange or other regulatory
                authority, the Purchaser will execute, deliver, file and otherwise
                assist
                the Corporation in filing such reports, undertakings and other documents
                with respect to the issuance of the Purchased Units as may be
                required;

            


    

    


    
      	(i)	
              the
                Purchaser is not a "control person" of the Corporation as defined
                in the
                Securities
                Act
                (Ontario) and the corresponding provision of the applicable securities
                legislation of the other provinces of Canada and will not become
                a
                “control person” of the Corporation by virtue of the acquisition of the
                Purchased Units subscribed for pursuant to this agreement and does
                not
                intend to act in concert with any other person to form a control
                group;

            


    

    


    
      	
              (j)

            	
              the
                Purchaser is capable of assessing the proposed investment as a result
                of
                the Purchaser’s financial or investment experience or as a result of
                advice received from a registered person other than the Corporation
                or an
                affiliate thereof, and is able to bear the economic loss of its
                investment;

            


    

    


    
      	
              (k)

            	
              the
                Purchaser acknowledges that the investment in the securities of the
                Corporation may have tax consequences to the Purchaser under applicable
                law, which the Purchaser is solely responsible for determining. The
                Purchaser acknowledges and agrees that the Purchaser is responsible
                for
                obtaining his or its own legal and tax advice;


            


    

    


    
      	(l)	
              no
                person has made any written or oral representation to the
                Purchaser:

            


    

    


    
      
         

      

      
        8

        
          

        

      

      
         

      

    

    
      	
            	(i)	
              that
                any person will resell or repurchase the Purchased
                Units;

            


    

    


    
      	
            	(ii)	
              that
                any person will refund the purchase price of the Purchased Units
                other
                than as provided in this Subscription Agreement;
                

            


    

    


    
      	
            	(iii)	
              relating
                to the future price or value of the Purchased Units;
                or

            


    

    


    
      	
            	(iv)	
              that
                the Common Shares will be listed and posted for trading on a stock
                exchange or that application has been made to list and post the Common
                Shares for trading on a stock
                exchange.

            


    

    


    9. Representations
      and Warranties of the Corporation

    


    The
      Corporation hereby represents and warrants and covenants to the Corporation,
      and
      acknowledges that the Purchaser is relying on such representations and
      warranties in agreeing to purchase the Purchased Units, that:

    


    
      	 	
              (a)
                

            	
              the
                Corporation has been duly incorporated and organized and validly
                subsists
                under the laws of the jurisdiction of its incorporation, and has
                all
                requisite power and authority, as the case may be, to, and is qualified
                to, carry on its business as now conducted and to own or lease its
                properties and assets in all jurisdictions in which it currently
                carries
                on business and/or owns or leases its properties and assets and the
                Corporation has all requisite power and authority to execute and
                deliver
                the Subscription Agreement, the Registration Rights Agreement and
                to
                perform its obligations hereunder and
                thereunder;

            


    

    


    
      	 	
              (b)
                

            	
              the
                Corporation has conducted and is conducting its business in compliance
                in
                all material respects, with all applicable laws, statutes, by-laws,
                rules
                and regulations of each jurisdiction in which its business is carried
                on
                and holds all material licenses, registrations, permits, consents
                or
                qualifications required in order to enable its business to be carried
                on
                as now conducted, and all such licenses, registrations, permits,
                consents
                and qualifications are valid and subsisting and in good standing
                in all
                respects;

            


    

    


    
      	 	
              (c)

            	
              the
                Corporation has not committed an act of bankruptcy or is insolvent,
                has
                proposed a compromise or arrangement to its creditors generally,
                has had a
                petition for a receiving order in bankruptcy filed against it, has
                made a
                voluntary assignment in bankruptcy, has taken any proceedings with
                respect
                to a compromise or arrangement, has taken any proceedings to have
                itself
                declared bankrupt, wound-up or dissolved, has taken any proceedings
                to
                have a receiver appointed to any of its property or has had any execution
                or distress become enforceable or become levied upon any of its
                properties;

            


    

    


    
      	 	
              (d)
                

            	
              the
                authorized capital of the Corporation consists of an unlimited number
                of
                Common Shares and, as at the date of the hereof the number of shares
                of
                Common Stock reflected in the Corporation's most recent SEC filings
                reflects the number of shares of Common Stock currently issued and
                outstanding as fully paid and
                non-assessable;

            


    

    


    
      
         

      

      
        9

        
          

        

      

      
         

      

    

    
      	 	
              (e)
                

            	
              there
                is not any other instrument or document to which the Corporation
                is a
                party or by which it is bound, and which imposes restriction upon,
                or
                impediment to, the declaration or payment of dividends by the
                Corporation;

            


    

    


    
      	 	
              (f)
                

            	
              the
                execution and delivery of this Subscription Agreement and the Registration
                Rights Agreement and the performance of the transaction contemplated
                hereunder and thereunder, the issuance of the First Units at the
                Closing
                Time, and compliance by the Corporation with the other provisions
                of this
                Subscription Agreement to be complied with by it, will not at the
                Closing
                Time:

            


    

    


    
      	 	
              (i)
                

            	
              create
                a state of facts which, after notice or lapse of time or both, will
                result
                in a breach of or default under, and will not conflict
                with:

            


    

    


    
      	 	
              (A)
                

            	
              any
                of the terms, conditions or provisions of the articles, by-laws or
                resolutions of the shareholders, directors or any committee of directors
                of the Corporation or any indenture, agreement or instrument to which
                the
                Corporation is a party or by which it or they are contractually bound;
                or

            


    

    


    
      	 	
              (B)

            	
              any
                statute, rule, regulation, by-law or law applicable to the Corporation
                ,
                including, without limitation, Canadian Securities Laws, or any judgment,
                order or decree of any governmental body, agency or court having
                jurisdiction over the Corporation ;
                or

            


    

    


    
      	 	
              (ii)
                

            	
              give
                rise to any lien, charge or claim in or with respect to the properties
                or
                assets now owned or hereafter acquired by the Corporation or the
                acceleration of or the maturity of any debt or other obligation under
                any
                indenture, mortgage, lease, agreement or instrument binding or affecting
                any of them or any of their
                properties;

            


    

    


    
      	 	
              (g)

            	
              Each
                of this Subscription Agreement and the Registration Rights Agreement
                has
                been or will be upon the execution thereof, duly authorized, executed
                and
                delivered by the Corporation and constitutes or will constitute when
                executed, a legal, valid and binding obligation of the Corporation
                enforceable against it in accordance with its respective terms, except
                that: (i) the enforcement thereof may be limited by bankruptcy, insolvency
                and other laws affecting the enforcement of creditors' rights generally;
                (ii) rights of indemnity, contribution and waiver of contribution
                thereunder may be limited under applicable law; and (iii) equitable
                remedies, including, without limitation, specific performance and
                injunctive relief, may be granted only in the discretion of a court
                of
                competent jurisdiction;

            


    

    


    
      
         

      

      
        10

        
          

        

      

      
         

      

    

    
      	 	
              (h)
                

            	
              upon
                completion of all of the transactions contemplated in this Agreement:
                (i)
                the Common Shares and Warrants comprising the First Units, and the
                Warrant
                Shares upon exercise of the Warrants, will have been validly authorized
                and issued by the Corporation; (ii) the Common Shares, and the Warrant
                Shares upon exercise of the Warrants, will be duly issued as fully
                paid
                and non-assessable and none of such securities will have been issued
                in
                violation of or subject to any pre-emptive rights or other contractual
                rights to purchase securities issued by the Corporation;
                and

            


    

    


    
      	 	
              (i)

            	
              the
                Corporation is the legal and beneficial owner of, has good and marketable
                title to, and possesses all of the assets material to its business
                free
                and clear of any encumbrances (other than leased equipment used in
                the
                ordinary course of business).

            


    

    


    10. Prior
      Agreement

    


    This
      Agreement sets forth all of the terms, conditions and agreements of the parties
      relating to the subject matter hereof and supersedes any and all prior
      agreements.

    


    11. Restricted
      Rights of Action 

    


    The
      Purchased Units are being purchased pursuant to an exemption from the
      requirement to prepare and file, and provide the Purchaser with a prospectus
      under applicable securities legislation and the Purchaser is aware that as
      a
      consequence:

    


    
      	 	
              (a)

            	
              the
                Purchaser is restricted from using most of the civil remedies available
                under applicable securities
                legislation;

            


    

     

    
      	 	
              (b)

            	
              no
                securities commission or similar regulatory authority has reviewed
                or
                passed on the merits of the
                Offering;

            


    

     

    
      	 	
              (c)

            	
              there
                are risks associated with the purchase of the Purchased
                Units;

            


    

     

    
      	 	
              (d)

            	
              the
                Purchaser may not receive information that would otherwise be required
                to
                be provided to the Purchaser under applicable securities legislation;
                and
                

            


    

     

    
      	 	
              (e)

            	
              the
                Corporation is relieved from certain obligations that would otherwise
                apply under applicable securities legislation;


            


    

    


    
      
         

      

      
        11

        
          

        

      

      
         

      

    

    12. Costs

    


    The
      Purchaser acknowledges and agrees that all costs and expenses incurred by the
      Purchaser (including any fees and disbursements of any special counsel retained
      by the Purchaser) relating to the sale of the Purchased Units to the Purchaser
      shall be borne by the Purchaser. The Corporation acknowledges and agrees that
      all costs and expenses incurred by the Corporation (including any fees and
      disbursements of any counsel retained by the Corporation) relating to the sale
      of the Purchased Units to the Purchasers shall be borne by the
      Corporation.

    


    13. Governing
      Law

    


    This
      Subscription Agreement is governed by the laws of the Province of Ontario and
      the federal laws of Canada applicable therein. The Purchaser, in his personal
      or
      its corporate capacity, as the case may be, and, if applicable, on behalf of
      each beneficial purchaser for whom the Purchaser is acting, irrevocably attorns
      to the jurisdiction of the courts of the Province of Ontario.

    


    14. Survival

    


    All
      warranties, representations, covenants and agreements herein contained or
      contained in any documents submitted pursuant to this Agreement and in
      connection with the transactions herein contemplated shall survive the Closing
      and continue in full force and effect for the benefit of the Purchaser and
      the
      Corporation for a period of two years from the Closing Date and shall not be
      limited or prejudiced by any investigation made by or on behalf of the Purchaser
      or the Corporation in connection with transactions herein contemplated or
      otherwise.

    


    15. Assignment

    


    This
      Subscription Agreement is not transferable or assignable by the parties
      hereto.

    16. Counterparts

    


    This
      Subscription Agreement may be executed in counterparts and delivered via
      facsimile transmission, each of which shall be deemed to be an original and
      all
      of which shall constitute one and the same document.

    


    17. English
      Language

    


    We,
      the
      undersigned, hereby acknowledge that we have consented and requested that all
      documents evidencing or relating in any way to the sale of the First Units
      be
      drawn up in the English language only.

    


    
      
         

      

      
        12

        
          

        

      

      
         

      

    

    18. Severability

    


    In
      the
      event that any provision of this Subscription Agreement is deemed to be void
      or
      unenforceable in whole or in part, it shall be deemed not to affect or impair
      the validity of any other provision of this Subscription Agreement and such
      void
      or unenforceable provision shall be severable from this Subscription
      Agreement.

    


    19. Modification

    


    Neither
      this Subscription Agreement nor any provision hereof shall be modified, changed,
      discharged or terminated except by an instrument in writing signed by the party
      against whom any waiver, change, discharge or termination is
      sought.

    


    20. No
      Revocation

    


    The
      Purchaser, on its own behalf and, if applicable, on behalf of others from whom
      he or it is contracting hereunder, agrees that this offer is made for valuable
      consideration and may not be withdrawn, cancelled, terminated or revoked by
      the
      Purchaser.

    


    21. Time
      of the Essence

    


    Time
      shall, in all respects, be of the essence hereof.

    


    22. Headings

    


    The
      headings contained herein are for convenience only and shall not affect the
      meaning or interpretation hereof.

    


    23. Singular
      and Plural, etc.

    


    Where
      the
      context so requires, words importing the singular number include the plural
      and
      vice versa, and words importing gender shall include the masculine, feminine
      and
      neutral genders.

    


    24. Subscription
      Particulars

    


    Subscription.
      The
      aggregate number of the First Units being subscribed for is_____ at a price
      equal to US$0.60 per First Unit, the aggregate price of the First Units being
      subscribed for is $_____.

    


    Registration.
      The
      First Units are to be registered in the name of:

    


    
      
         

      

      
        13

        
          

        

      

      
         

      

    

    Delivery.
      The
      certificates representing the First Units are to be delivered to:

     

     

    (name)


    
      
        

      

    

     

    (address)

    
      

    

    

      
(contact
      name and number)

    


    
      	 	
              DATED
                as
                of the ___ day of _________, 200_.

            


    

    


     

     

    
      	 	
               

              
                
Name
                of Purchaser (please type or
                print)

            
	 	
               

               

              
                

              

              (Signature of
                Purchaser)

            


    

     

     

    
      	 	
              
                

              

              (Address
                of Purchaser)

               

              
                
 

              
                

              

            


    

     

    
      
         

      

      
        14

        
          

        

      

      
         

      

    

     

    25. Acceptance

    


    The
      Corporation hereby accepts the above-mentioned offer to purchase First
      Units.

    


    


    DATED
      as of
      this ___ day of ________, 200_.

    


    
      	 	 	 
	 	MICROMEM TECHNOLOGIES
              INC.
	 
 	 
 	 
 
	 	By:  	 
	 	
              
Authorized
              Signing Officer
	 	 


    

     

    
      
         

      

      
        15

        
          

        

      

      
         

      

    

    
SCHEDULE
      I

     

    CERTIFICATE
      OF ONTARIO SUBSCRIBER

    


    
      	To:	
              Micromem
                Technologies Inc. (the
                "Corporation")

            


    

     

    In
      addition to the representations and warranties set forth in the Subscription
      for
      Units of the Corporation to which this Certificate is attached, the Subscriber
      certifies to the Corporation and ___ (and acknowledges that the Corporation
      and
      ___ are relying thereon) that the Subscriber satisfies (or if the Subscriber
      is
      purchasing as agent for the beneficial purchaser named under "Subscription
      Particulars" in the Subscription Agreement, such beneficial purchaser satisfies)
      one or more of the categories of "accredited investor", as defined by Ontario
      Securities Commission Rule 45-501 in force in the Province of Ontario because
      the Subscriber is (please place an "X" on the appropriate line):

    


    (a)
       ______ a
      bank
      listed in Schedule I or II of the Bank Act(Canada), or an authorized foreign
      bank listed in Schedule III of that Act;

    


    (b)
       ______ the
      Business Development Bank incorporated under the Business Development Bank
      Act
      (Canada);

    


    (c)
       ______ a
      loan
      corporation or trust corporation registered under the Loan and Trust
      Corporations Act or under the Trust and Loan Companies Act (Canada), or under
      comparable legislation in any other jurisdiction;

    


    (d)
       ______ a
      co-operative credit society, credit union central, federation of caisses
      populaires, credit union or league, or regional caisse populaire, or an
      association under the Cooperative Credit Associations Act (Canada), in each
      case, located in Canada;

    


    (e)
       ______ a
      company
      licensed to do business as an insurance company in any jurisdiction;


    


    (f)
       ______ a
      subsidiary of any company referred to in paragraph (a), (b), (c), (d) or (e),
      where the company owns all of the voting shares of the subsidiary;

    


    (g)
       ______ a
      person
      or company registered under the Act or securities legislation in another
      jurisdiction as an adviser or dealer, other than a limited market
      dealer;

    


    (h)
       ______ the
      government of Canada or of any jurisdiction, or any crown corporation,
      instrumentality or agency of a Canadian federal, provincial or territorial
      government;

    


    (i)
       ______ any
      Canadian municipality or any Canadian provincial or territorial capital city;
      

    


    (j)
       ______ any
      national, federal, state, provincial, territorial or municipal government of
      or
      in any foreign jurisdiction, or any instrumentality or agency
      thereof;

    


    (k)
       ______ a
      pension
      fund that is regulated by either the Office of the Superintendent of Financial
      Institutions (Canada) or a provincial pension commission or similar regulatory
      authority;

    


    (l)
       ______ a
      registered charity under the Income Tax Act (Canada);

    


    (m)
       ______ an
      individual who beneficially owns, or who together with a spouse beneficially
      own, financial assets having an aggregate realizable value that, before taxes
      but net of any related liabilities, exceeds $1,000,000;

    


    (n)
       ______ an
      individual whose net income before taxes exceeded $200,000 in each of the two
      most recent years or whose net income before taxes combined with that of a
      spouse exceeded $300,000 in each of those years and who, in either case, has
      a
      reasonable expectation of exceeding the same net income level in the current
      year;

    


    
      
         

      

      
        16

        
          

        

      

      
         

      

    

    (o)
       ______ an
      individual who has been granted registration under the Act or securities
      legislation in another jurisdiction as a representative of a person or company
      referred to in paragraph (g), whether or not the individual’s registration is
      still in effect;

    


    (p)
       ______ a
      promoter of the issuer or an affiliated entity of a promoter of the issuer;
      

    


    (q)
       ______ a
      spouse,
      parent, grandparent or child of an officer, director or promoter of the
      issuer;

    


    (r)
       ______ a
      person
      or company that, in relation to the issuer, is an affiliated entity or a person
      or company referred to in clause (c) of the definition of distribution in
      subsection 1(1) of the Act;

    


    (s)
       ______ an
      issuer
      that is acquiring securities of its own issue;

    


    (t)
       ______ a
      company, limited partnership, limited liability partnership, trust or estate,
      other than a mutual fund or non-redeemable investment fund, that had net assets
      of at least $5,000,000 as reflected in its most recently prepared financial
      statements; 

    


    (u)
       ______ a
      person
      or company that is recognized by the Commission as an accredited
      investor;

    


    (v)
       ______ a
      mutual
      fund or non-redeemable investment fund that, in Ontario, distributes its
      securities only to persons or companies that are accredited
      investors;

    


    (w)
       ______ a
      mutual
      fund or non-redeemable investment fund that, in Ontario, distributes its
      securities under a prospectus for which a receipt has been granted by the
      Director;

    


    (x)
       ______ a
      managed
      account if it is acquiring a security that is not a security of a mutual fund
      or
      non-redeemable investment fund;

    


    (y)
       ______ an
      account that is fully managed by a trust corporation registered under the Loan
      and Trust Corporations Act; 

    


    (z)
       ______ an
      entity
      organized outside of Canada that is analogous to any of the entities referred
      to
      in paragraphs (a) through (g) and paragraph (k) in form and function; and


    


    (aa)
       ______ a
      person
      or company in respect of which all of the owners of interests, direct or
      indirect, legal or beneficial, are persons or companies that are accredited
      investors.

    


    Dated
      this ____ day of ____________, ______


    _____________________________________________

    Name
      of
      Subscriber (Please Print)

    


    _____________________________________________

    Signature
      of Subscriber or Authorized Representative

    


    _____________________________________________

    Official
      Capacity of person signing if other than the Subscriber

    


    _____________________________________________

    Name
      of
      Person Signing if other than the Subscriber (Please Print)

     

    
      
         

      

      
        17