1
EXHIBIT 1
AMENDED AND RESTATED
SHAREHOLDER RIGHTS PLAN AGREEMENT
DATED AS OF NOVEMBER 1, 2000
between
GOLDCORP INC.
and
MONTREAL TRUST COMPANY OF CANADA
as Rights Agent
2
MEMORANDUM OF AGREEMENT made as of the 1st day of November, 2000.
B E T W E E N:
GOLDCORP INC.,
a corporation amalgamated under the laws of the Province of Ontario,
(hereinafter called the "CORPORATION"),
OF THE FIRST PART,
- and -
MONTREAL TRUST COMPANY OF CANADA,
a trust company existing under the laws of Canada, as rights agent,
(hereinafter called the "RIGHTS AGENT"),
OF THE SECOND PART.
WHEREAS the Board of Directors has determined that it is advisable that the
Corporation adopt a shareholder rights plan (the "RIGHTS PLAN");
AND WHEREAS in order to implement the Rights Plan the Board of Directors of
the Corporation has:
(a) authorized the issuance of one right (a "RIGHT") in respect of each
Common Share outstanding at the Record Time;
(b) authorized the issuance of one Right in respect of each Common Share
issued after the Record Time and prior to the earlier of the
Separation Time and the Expiration Time; and
(c) authorized the issuance of one Right in respect of each Conversion
Share issued after the Separation Time and prior to the earlier of the
close of business on the eighth Trading Day following the Stock
Acquisition Date and the Expiration Time;
3
-2-
AND WHEREAS each Right entitles the holder thereof, after the Separation
Time, to purchase securities of the Corporation pursuant to the terms and
subject to the conditions set forth herein;
AND WHEREAS the Corporation desires to appoint the Rights Agent to act on
behalf of the Corporation and holders of Rights, and the Rights Agent is willing
so to act, in connection with the issuance, transfer, exchange and replacement
of Rights Certificates (as hereinafter defined), the exercise of Rights and
other matters referred to herein;
NOW THEREFORE, in consideration of the premises and the respective
covenants and agreements set forth herein the parties hereby agree as follows:
ARTICLE 1
INTERPRETATION
1.1 CERTAIN DEFINITIONS
For the purposes of this Agreement, the following terms have the meanings
indicated:
(a) "ACQUIRING PERSON" means any Person who is the Beneficial Owner of 20%
or more of the outstanding Common Shares; provided, however, that the
term "Acquiring Person" shall not include:
(i) the Corporation or any Subsidiary of the Corporation;
(ii) any Person who becomes the Beneficial Owner of 20% or more of the
outstanding Common Shares as a result of any one or any
combination of:
(A) an acquisition and cancellation or redemption or the
conversion by the Corporation or a Subsidiary of the
Corporation of Common Shares which, by reducing the number
of Common Shares outstanding, increases the percentage of
outstanding Common Shares Beneficially Owned by such Person
to 20% or more of the Common Shares outstanding (a "SHARE
REDUCTION");
(B) an acquisition of Common Shares made pursuant to a Permitted
Bid or a Competing Permitted Bid (a "PERMITTED BID
ACQUISITION");
(C) an acquisition of Common Shares in respect of which the
Board of Directors has waived the application of section 4.1
pursuant to the provisions of section 6.1 (an "EXEMPT
ACQUISITION"); or
4
-3-
(D) a Pro Rata Acquisition;
provided, however, that if a Person shall become the Beneficial
Owner of 20% or more of the Common Shares then outstanding by
reason of one or any combination of a Share Reduction, a
Permitted Bid Acquisition, an Exempt Acquisition or a Pro Rata
Acquisition and thereafter such Person, while such Person is the
Beneficial Owner of 20% or more of the Common Shares then
outstanding, increases the number of Common Shares beneficially
owned by such Person by more than 1% of the number of Common
Shares outstanding (other than pursuant to one or any combination
of a Share Reduction, a Permitted Bid Acquisition, an Exempt
Acquisition or a Pro Rata Acquisition) then, as of the date such
Person becomes the Beneficial Owner of such additional
outstanding Shares, such Person shall be an "Acquiring Person";
(iii) for the period of 10 days after the Disqualification Date (as
hereinafter defined), any Person who becomes the Beneficial Owner
of 20% or more of the outstanding Common Shares as a result of
such Person becoming disqualified from relying on clause
1.1(d)(viii) or clause 1.1(d)(x) hereof because such Person makes
or announces an intention to make a Take-over Bid alone or by
acting jointly or in concert with any other Person and, for this
purpose, "DISQUALIFICATION DATE" means the first date of public
announcement of facts indicating that such Person is making or
intends to make a Take-over Bid; or
(iv) an underwriter or member of a banking or selling group acting in
such capacity that becomes the Beneficial Owner of 20% or more of
the Common Shares in connection with a distribution of securities
of the Corporation under a prospectus or by way of private
placement;
(b) "AFFILIATE", when used to indicate a relationship with a specified
Person, means a Person who directly, or indirectly through one or more
intermediaries, controls, or is controlled by, or is under common
control with, such specified Person;
(c) "ASSOCIATE", where used to indicate a relationship with any Person,
means:
(i) any relative of that Person who has the same residence as that
Person;
(ii) any individual who has the same residence as that Person and to
whom that Person is married or with whom that Person is living in
a conjugal relationship outside marriage; or
5
-4-
(iii) any relative of a Person mentioned in clause (ii) above who has
the same residence as that Person;
(d) a Person shall be deemed the "BENEFICIAL OWNER" of, and to have
"BENEFICIAL OWNERSHIP" of, and to "BENEFICIALLY OWN":
(i) any securities as to which such Person or any of such Person's
Affiliates or Associates is the owner at law or in equity;
(ii) any securities as to which such Person or any of such Person's
Affiliates or Associates has the right to acquire (whether such
right is exercisable immediately or within a period of 60 days
thereafter or upon the occurrence of a contingency) pursuant to
any agreement, arrangement, pledge or understanding, whether or
not in writing (other than customary agreements with and between
underwriters or banking group or selling group members with
respect to a distribution of securities under a prospectus or by
way of private placement and other than pledges of securities in
the ordinary course of business) or upon the exercise of any
conversion right, exchange right, share purchase right (other
than a Right), warrant or option; and
(iii) any securities which are Beneficially Owned within the meaning
of the foregoing provisions of this subsection 1.1(d) by any
other Person with whom such Person is acting jointly or in
concert;
provided, however, that a Person shall not be deemed the Beneficial
Owner of or to have Beneficial Ownership of, or to Beneficially Own,
any security because:
(iv) either (A) the holder of such security has agreed pursuant to a
Permitted Lock-up Agreement to deposit or tender such security to
a Take-over Bid made by such Person or by any of such Person's
Affiliates or Associates or by any other Person acting jointly or
in concert with such Person or (B) such security has been
deposited or tendered pursuant to any Take-over Bid made by such
Person or by any of such Person's Affiliates or Associates or by
any Person acting jointly or in concert with such Person, in
either case until such deposited security has been taken up or
paid for, whichever shall occur first;
(v) such Person holds such security, provided that:
(A) the ordinary business of such Person (an "INVESTMENT
MANAGER") includes the management of investment funds for
others (which others, for greater certainty, may include or
be limited to one or more employee benefit plans or pension
plans) and such security is held by the Investment Manager
6
-5-
in the ordinary course of such business in the performance
of such Investment Manager's duties for the account of any
other Person or Persons (a "CLIENT"), including
non-discretionary accounts held on behalf of a Client by a
broker or dealer provided that such broker or dealer, or any
Person with whom such broker or dealer is acting jointly or
in concert, is not making a Take-over Bid; or
(B) such Person (a "TRUST COMPANY") is licensed to carry on the
business of a trust company under applicable laws and, as
such, acts as trustee or administrator or in a similar
capacity in relation to the estates of deceased or
incompetent Persons ("ESTATE ACCOUNTS") or in relation to
other accounts ("OTHER ACCOUNTS") and holds such security in
the ordinary course of such duties for the estate of any
such deceased or incompetent Person or for such Other
Accounts; or
(C) such Person (an "ADMINISTRATOR") is the administrator or the
trustee of one or more pension funds or plans (each a
"PLAN") registered under applicable laws and holds such
security for the purposes of its activities as such
administrator or trustee; or
(D) such Person is a Crown agent or agency;
provided that the Investment Manager, Trust Company,
Administrator, the Plan, or the Crown agent or agency, as the
case may be, is not then making and has not announced a current
intention to make a Take-over Bid (other than an Offer to Acquire
Shares or other securities of the Corporation by means of a
distribution by the Corporation or ordinary market transactions
(including pre-arranged trades) executed through the facilities
of a stock exchange or organized over-the-counter market) alone
or acting jointly or in concert with any other Person;
(vi) such Person, any of such Person's Affiliates or Associates or any
Person acting jointly or in concert with such Person is:
(A) a Client of the same Investment Manager as another Person on
whose account the Investment Manager holds such security;
(B) an Estate Account or an Other Account of the same Trust
Company as another Person on whose account the Trust Company
holds such security; or
7
-6-
(C) a Plan which has the same Administrator as another Plan on
whose account the Administrator holds such security;
(vii) such Person or any of such Person's Affiliates or Associates
Beneficially Owns such security, provided that the Person is a
pension fund or plan established by statute for purposes that
include, and the ordinary business or activity of such Person
includes, the management of investment funds for employee benefit
plans, pension plans, insurance plans or various public bodies
and, in any such case, such Person holds such securities for the
purposes of its activities as such a Person, and further provided
that such Person is not then making a Take-over Bid or has not
then announced a current intention to make a Take-over Bid, alone
or acting jointly or in concert with another Person, other than
an Offer to Acquire Common Shares or other securities by such
Person by means of a distribution by the Corporation or by means
of ordinary market transactions (including pre-arranged trades)
executed through the facilities of a stock exchange or organized
over-the-counter market;
(viii) such Person is (i) a Client of an Investment Manager and such
security is owned at law or in equity by the Investment Manager,
or (ii) an account of a Trust Company and such security is owned
at law or in equity by the Trust Company, or (iii) a Plan and
such security is owned at law or in equity by the Administrator
thereof; or
(ix) such Person is the registered holder of such security in the
ordinary course of its business as, or in the ordinary course of
acting as a nominee for, a securities depositary;
(e) "BOARD OF DIRECTORS" means the board of directors of the Corporation
or, if duly constituted and whenever duly empowered, the executive
committee of the board of directors of the Corporation;
(f) "BUSINESS DAY" means any day other than a Saturday, a Sunday or a day
on which banking institutions in Toronto, Ontario are authorized or
obligated by law to close;
(g) "CLOSE OF BUSINESS" on any date means the time on such date (or, if
such date is not a Business Day, the time on the next succeeding
Business Day) at which the offices of the transfer agent for the
Common Shares (or, after the Separation Time, the offices of the
Rights Agent) are closed to the public in the city in which such
transfer agent or Rights Agent has an office for the purposes of this
Agreement;
8
-7-
(h) "COMMON SHARE" means a common share of the Corporation and any other
share of the Corporation into which such share may be subdivided,
consolidated, reclassified or changed;
(i) "COMMON SHARES", when used with reference to any Person other than the
Corporation, means the class or classes of shares (or similar equity
interests) with the greatest per share (or similar interest) voting
power entitled to vote generally in the election of directors of such
other Person;
(j) "COMPETING PERMITTED BID" means a Take-over Bid that:
(i) is made after a Permitted Bid has been made and prior to the
expiry of the Permitted Bid;
(ii) satisfies all components of the definition of a Permitted Bid
other than the requirements set out in clause (ii) of such
definition; and
(iii) contains, and the take-up and payment for securities tendered or
deposited is subject to, an irrevocable and unqualified condition
that no Shares be taken up or paid for pursuant to the Take-over
Bid prior to the close of business on a date that is no earlier
than the later of (A) 45 days after the date on which the
earliest Permitted Bid which preceded the Competing Permitted Bid
was made; and (B) 21 days after the date of the Take-over Bid
constituting the Competing Permitted Bid;
(k) "CONTROLLED": a corporation is "controlled" by another Person or by
two or more Persons acting jointly or in concert if:
(i) securities entitled to vote in the election of directors carrying
more than 50% of the votes for the election of the directors are
held, directly or indirectly, by or for the benefit of the other
Person or two or more Persons acting jointly or in concert; and
(ii) the votes carried by such securities are entitled, if exercised,
to elect a majority of the board of directors of such
corporation;
and "CONTROLS", "CONTROLLING" and "UNDER COMMON CONTROL WITH" shall be
interpreted accordingly;
(l) "CONVERSION SHARES" means Shares issued pursuant to and in accordance
with the terms of a Convertible Security;
(m) "CONVERTIBLE SECURITY" includes any option, warrant, debenture, share
or other instrument (other than a Right) that is outstanding on the
date hereof, or that is issued after the date hereof and prior to the
Separation
9
-8-
Time, that confers on the holder thereof the right or obligation to
acquire a Share;
(n) "DIVIDENDS PAID IN THE ORDINARY COURSE" means cash dividends paid at
regular intervals in any financial year of the Corporation to the
extent that such cash dividends do not exceed, in the aggregate, the
greatest of:
(i) 200% of the aggregate amount of cash dividends declared payable
by the Corporation on its Shares in its immediately preceding
financial year;
(ii) 300% of the arithmetic average of the aggregate amounts of cash
dividends declared payable by the Corporation on its Shares in
its three immediately preceding financial years; and
(iii) 100% of the aggregate consolidated net income of the
Corporation, before extraordinary items, for its immediately
preceding financial year;
(o) "ELECTION TO EXERCISE" has the meaning ascribed thereto in clause
3.1(d)(ii);
(p) "EXEMPT ACQUISITION" has the meaning ascribed thereto in subclause
1.1(a)(ii)(C);
(q) "EXERCISE PRICE" means, as of any date, the price at which a holder of
a Right may purchase the securities issuable upon exercise of such
Right; until adjustment thereof in accordance with the terms hereof,
the Exercise Price for each Right shall be $50.00;
(r) "EXPIRATION TIME" means the earlier of:
(i) the Termination Time; and
(ii) the close of business on the date of the annual meeting of
shareholders of the Corporation held in the year 2004, unless at
such meeting shareholders have reconfirmed this Agreement for an
additional period of time in which case "EXPIRATION TIME" shall
mean the end of such additional period of time, and so on from
time to time;
(s) "FLIP-IN EVENT" means a transaction in or pursuant to which any Person
shall become an Acquiring Person;
(t) "INDEPENDENT SHAREHOLDERS" means holders of Shares other than (i) any
Acquiring Person, (ii) any Offeror (other than any Person who,
pursuant to subsection 1.1(d), is deemed not to Beneficially Own the
Shares held by such Person), (iii) any Affiliate or Associate of any
Acquiring Person or
10
-9-
Offeror, (iv) any Person acting jointly or in concert with any
Acquiring Person or Offeror and (v) any employee benefit plan,
deferred profit sharing plan, stock participation plan or trust for
the benefit of employees of the Corporation or a wholly-owned
Subsidiary of the Corporation, unless the beneficiaries of such plan
or trust direct the manner in which the relevant Shares are to be
voted or direct whether the relevant Shares are to be tendered to a
Take-over Bid;
(u) "MARKET PRICE" per share of any securities on any date of
determination means the weighted average trading price per share of
such securities (determined as described below) for the 20 consecutive
Trading Days through and including the Trading Day immediately
preceding such date; provided, however, that if an event of a type
analogous to any of the events described in section 3.2 shall have
caused the sale prices in respect of any Trading Day used to determine
the Market Price not to be fully comparable with the sale prices on
such date of determination or, if the date of determination is not a
Trading Day, on the immediately preceding Trading Day, each such sale
price so used shall be appropriately adjusted in a manner analogous to
the applicable adjustment provided for in section 3.2 in order to make
it fully comparable with the sale price on such date of determination
or, if the date of determination is not a Trading Day, on the
immediately preceding Trading Day; the weighted average trading price
per share of any securities on any date shall be determined by
dividing the aggregate sale price of all securities sold on the
principal stock exchange in Canada on which such securities are listed
and posted for trading by the total number of securities so sold; and
(i) if for any reason such prices are not available on such day or
the securities are not listed and posted for trading on any stock
exchange in Canada, the Market Price shall be calculated using
the sale prices for such securities as reported in the principal
consolidated transaction reporting system with respect to
securities listed or admitted to trading on the principal
national securities exchange in the United States on which such
securities are listed or admitted to trading;
(ii) if for any reason such prices are not available on such day or
the securities are not listed and posted for trading on a stock
exchange in Canada or a national securities exchange in the
United States, the Market Price shall be calculated using the
sale prices for such securities in the over-the-counter market,
as reported by The Canadian Dealing Network Inc. or such other
comparable system then in use; or
(iii) if on any such date the securities are not quoted by any such
organization, the Market Price shall be calculated using the
11
-10-
average of the closing bid and asked prices as furnished by a
professional market maker making a market in the securities
selected in good faith by the Board of Directors;
provided, however, that if on any such date the securities are not
traded on any exchange or in the over-the-counter market and the price
referred to in clause (iii) above is not available, the closing price
per share of such securities on such date shall mean the fair value
per share of such securities on such date as determined by a
nationally or internationally recognized investment dealer or
investment banker;
(v) "OBCA" means the Business Corporations Act (Ontario), R.S.O. 1990, c.
B.16, as amended, and the regulations made thereunder, and any
comparable or successor laws or regulations thereto;
(w) "OFFER TO ACQUIRE" includes:
(i) an offer to purchase, or a solicitation of an offer to sell; and
(ii) an acceptance of an offer to sell, whether or not such offer to
sell has been solicited,
or any combination thereof, and the Person accepting an offer to sell
shall be deemed to be making an Offer to Acquire to the Person who
made the offer to sell;
(x) "OFFEROR" means a Person who has announced a current intention to make
or who is making a Take-over Bid;
(y) "PERMITTED BID" means a Take-over Bid which is made by means of a
take-over bid circular and which also complies with the following
additional provisions:
(i) the Take-over Bid is made to all holders of Shares as registered
on the books of the Corporation, other than the Offeror;
(ii) the Take-over Bid contains, and the take-up and payment for
securities tendered or deposited thereunder is subject to,
irrevocable and unqualified conditions that no Shares shall be
taken up or paid for pursuant to the Take-over Bid (A) prior to
the close of business on a date that is not earlier than 45 days
after the date of the Take-over Bid and (B) unless, at the close
of business on the date Shares are first taken up or paid for
under the Take-over Bid, more than 50% of the Shares then
outstanding that are held by Independent Shareholders have been
deposited or tendered pursuant to the Take-over Bid and not
withdrawn;
12
-11-
(iii) the Take-over Bid contains an irrevocable and unqualified
provision that, unless the Take-over Bid is withdrawn, Shares
may be deposited pursuant to such Take-over Bid at any time
during the period of time between the date of the Take-over Bid
and the date on which Shares may be taken up and paid for and
that any Shares deposited pursuant to the Take-over Bid may be
withdrawn until taken up and paid for; and
(iv) the Take-over Bid contains an irrevocable and unqualified
provision that if, on the date on which Shares may be taken up
and paid for, the condition in clause (ii)(B) has been
satisfied, the Offeror will make a public announcement of that
fact and the Take-over Bid will remain open for deposits and
tenders of Shares for not fewer than 10 Business Days after the
date of such public announcement;
(z) "PERMITTED BID ACQUISITION" has the meaning ascribed thereto in
subclause 1.1(a)(ii)(B);
(aa) "PERMITTED LOCK-UP AGREEMENT" means an agreement between an Offeror
and another Person (the "LOCKED-UP PERSON") whereby the Locked-up
Person agrees to deposit or tender the Shares held by the Locked-up
Person to the Offeror's Take-over Bid (the "LOCK-UP BID") where the
agreement:
(i) permits the Locked-up Person to withdraw the Shares from the
agreement in order to tender or deposit the Shares to another
Take-over Bid, or to support another transaction, that provides
for a consideration for each Share that is higher than the
consideration contained in or proposed to be contained in the
Lock-up Bid and is made for at least the same number of Shares as
the Lock-up Bid; or
(ii) (A) permits the Locked-up Person to withdraw the Shares from the
agreement in order to tender or deposit the Shares to another
Take-over Bid, or to support another transaction, that provides
for a consideration for each Share that exceeds by as much as or
more than a specified amount (the "SPECIFIED AMOUNT") the
consideration for each Share contained in or proposed to be
contained in the Lock-up Bid and is made for at least the same
number of Shares as the Lock-up Bid and (B) does not by its terms
provide for a Specified Amount that is greater than 7% of the
consideration for each Share contained in or proposed to be
contained in the Lock-up Bid;
and, for greater certainty, the Lock-up Agreement may (1) contain a
right of first refusal in favour of the Offeror or (2) require a
period of delay to give the Offeror an opportunity to match or exceed
the consideration
13
-12-
offered in another Take-over Bid or transaction or (3) contain other
similar limitations on a Locked-up Person's right to withdraw Shares
from the Lock-up Agreement and not tender such Shares to the Lock-up
Bid, so long as the limitation does not preclude the exercise by the
Locked-up Person of the right to withdraw Shares in sufficient time to
tender to the other Take-over Bid or participate in the other
transaction; and
(iii) does not provide for the payment by the Locked-up Person, in the
event that the Locked-up Person fails to deposit or tender Shares
to the Lock-up Bid or withdraws the Shares in order to tender to
another Take-over Bid or participate in another transaction, of
any "break-up" fees, "top-up" fees, penalties, expense
reimbursement or other amounts that exceed in the aggregate the
greater of:
(A) the cash equivalent of 2.5% of the consideration that the
Locked-up Person would have received under the Lock-up Bid;
and
(B) 50% of the amount by which the consideration payable to the
Locked-up Person under another Take-over Bid or transaction
exceeds the consideration such Locked-up Person would have
received under the Lock-up Bid; and
(iv) is disclosed to the public, including the Corporation, by making
copies thereof available not later than the date on which the
Lock-up Bid has been publicly announced (or, if the Lock-up Bid
has been publicly announced prior to the date on which the
Lock-up Agreement is entered into, not later than such date);
(bb) "PERSON" includes any individual, body corporate, firm, partnership,
association, cooperative, trust, trustee, executor, administrator,
legal personal representative, group, unincorporated organization,
syndicate, government or governmental agency or instrumentality or
other entity;
(cc) "PRO RATA ACQUISITION" means:
(i) the acquisition of Shares as a result of a stock dividend, a
stock split or other event pursuant to which a Person receives
or acquires Shares on the same pro rata basis as all other
holders of Shares;
(ii) the acquisition of Shares pursuant to any regular dividend
reinvestment plan or other plan made available by the
Corporation to holders of all of its Shares;
(iii) the receipt and/or exercise of rights issued by the Corporation
to all the holders of Shares to subscribe for or purchase
Shares, provided that such rights are acquired directly from the
Corporation and not from any other Person; or
14
-13-
(iv) the acquisition of Shares pursuant to a distribution of Shares,
or Convertible Securities (and the conversion or exchange of such
Convertible Securities), made by the Corporation under a
prospectus or by way of private placement;
provided that such Person does not thereby acquire a percentage of
Shares or of such Convertible Securities that is greater than the
percentage of Shares Beneficially Owned by such Person immediately
prior to such acquisition;
(dd) "RECORD TIME" means 5:00 p.m. (Toronto time) on September 25, 2000;
(ee) "RIGHT" has the meaning ascribed thereto in the recitals hereto;
(ff) "RIGHTS AGENT" means Montreal Trust Company of Canada;
(gg) "RIGHTS CERTIFICATES" means the certificates representing the Rights
after the Separation Time, which shall be in the form attached hereto
as Exhibit A;
(hh) "RIGHTS REGISTER" and "RIGHTS REGISTRAR" have the respective meanings
ascribed thereto in subsection 2.3(a);
(ii) "SECURITIES ACT (ONTARIO)" means the Securities Act, R.S.O. 1990, c.
S.5, as amended, and the regulations and rules thereunder, and any
comparable or successor laws or regulations thereto;
(jj) "SEPARATION TIME" means, subject to subsection 6.1(c), the close of
business on the eighth Trading Day after the earlier of:
(i) the Stock Acquisition Date; and
(ii) the date of the commencement of, or first public announcement
(provided such announcement is made after the Record Time) of,
the intent of any Person (other than the Corporation or any
Subsidiary of the Corporation) to commence a Take-over Bid (other
than a Permitted Bid or a Competing Permitted Bid);
or such later time as may be determined by the Board of Directors;
provided that if the foregoing results in the Separation Time being
prior to the Record Time, the Separation Time shall be the Record Time
and provided further that, if any Take-over Bid referred to in clause
(ii) of this subsection 1.1(ff) expires, or is cancelled, terminated
or otherwise withdrawn prior to the Separation Time, such Take-over
Bid shall be deemed, for the purposes of the subsection 1.1(ff), never
to have been made;
15
-14-
(kk) "SHARES" means the Common Shares, unless the context otherwise
requires;
(ll) "SHARE REDUCTION" has the meaning ascribed thereto in subclause
1.1(a)(ii)(A);
(mm) "STOCK ACQUISITION DATE" means the date of the first public
announcement (which for the purposes of this definition shall include,
without limitation, the filing of a report pursuant to the Securities
Act (Ontario)) by the Corporation or an Acquiring Person of facts
indicating that a Person has become an Acquiring Person;
(nn) "SUBSIDIARY" of a Person has the meaning ascribed thereto in the
Securities Act (Ontario);
(oo) "TAKE-OVER BID" means an Offer to Acquire Shares of the Corporation or
other securities of the Corporation if, assuming that the Shares or
other securities of the Corporation subject to the Offer to Acquire
are acquired at the date of such Offer to Acquire by the Person making
such Offer to Acquire, the Shares Beneficially Owned by the Person
making the Offer to Acquire would constitute in the aggregate 20% or
more of the Shares then outstanding;
(pp) "TERMINATION TIME" means the time at which the right to exercise
Rights shall terminate pursuant to subsection 6.1(f); and
(qq) "TRADING DAY", when used with respect to any securities, means a day
on which the principal Canadian securities exchange on which such
securities are listed or admitted to trading is open for the
transaction of business or, if the securities are not listed or
admitted to trading on any Canadian securities exchange, a Business
Day.
1.2 Currency
All sums of money which are referred to in this Agreement are expressed in
lawful money of Canada, unless otherwise specified.
1.3 DESCRIPTIVE HEADINGS
Descriptive headings appear herein for convenience only and shall not
control or affect the meaning or construction of any of the provisions hereof.
1.4 REFERENCES TO AGREEMENT
References to "this Agreement", "hereto", "herein" "hereby" "hereunder",
"hereof " and similar expressions refer to this Agreement, as amended or
supplemented from time to time, and not to any particular Article, section,
subsection, clause, subclause,
16
- 15 -
subdivision or other portion hereof and include any and every instrument
supplemental or ancillary hereto.
1.5 CALCULATION OF NUMBER AND PERCENTAGE OF BENEFICIAL OWNERSHIP OF OUTSTANDING
SHARES
(a) For the purposes of this Agreement, in determining the percentage of
the outstanding Shares with respect to which a Person is or is deemed
to be the Beneficial Owner, all unissued Shares of which such Person
is deemed to be the Beneficial Owner shall be deemed to be
outstanding.
(b) The percentage of outstanding Shares Beneficially Owned by any Person
shall, for the purposes of this Agreement, be and be deemed to be the
product determined by the formula:
100 x A
---------------
B
where: A = the number of outstanding Shares Beneficially Owned by such
Person; and
B = the number of outstanding Shares.
The percentage of outstanding Shares represented by any particular group of
Shares acquired or held by any Person shall be determined in like manner mutatis
mutandis.
1.6 ACTING JOINTLY OR IN CONCERT
For the purposes of this Agreement, a Person is acting jointly or in
concert with another Person if such Person has any agreement, arrangement,
commitment or understanding (whether formal or informal and whether or not in
writing) with such other Person to acquire or Offer to Acquire any Shares (other
than (i) customary agreements with and between underwriters and banking group or
selling group members with respect to a distribution of securities under a
prospectus or by way of private placement and (ii) pursuant to a pledge of
securities in the ordinary course of business).
ARTICLE 2
THE RIGHTS
2.1 LEGEND ON CERTIFICATES
Certificates for Shares issued after the Record Time but prior to the
earlier of the Separation Time and the Expiration Time shall evidence, in
addition to the Shares, one Right for each Share evidenced thereby and shall
have impressed on, printed on, written on or otherwise affixed to them the
following legend:
17
- 16 -
UNTIL THE SEPARATION TIME (AS DEFINED IN THE RIGHTS AGREEMENT REFERRED TO
BELOW), THIS CERTIFICATE ALSO EVIDENCES AND ENTITLES THE HOLDER HEREOF TO
CERTAIN RIGHTS AS SET FORTH IN A SHAREHOLDER RIGHTS PLAN AGREEMENT, DATED
AS OF THE 1ST DAY OF NOVEMBER, 2000 (THE "RIGHTS AGREEMENT") BETWEEN
GOLDCORP INC. (THE "CORPORATION") AND MONTREAL TRUST COMPANY OF CANADA, AS
RIGHTS AGENT, (AS THE SAME MAY BE AMENDED OR SUPPLEMENTED FROM TIME TO TIME
IN ACCORDANCE WITH THE TERMS THEREOF) THE TERMS OF WHICH ARE HEREBY
INCORPORATED HEREIN BY REFERENCE AND A COPY OF WHICH MAY BE INSPECTED
DURING NORMAL BUSINESS HOURS AT THE PRINCIPAL EXECUTIVE OFFICES OF THE
CORPORATION. UNDER CERTAIN CIRCUMSTANCES, AS SET FORTH IN THE RIGHTS
AGREEMENT SUCH RIGHTS MAY BE TERMINATED, MAY EXPIRE, MAY BECOME VOID (IF,
IN CERTAIN CASES, THEY ARE "BENEFICIALLY OWNED" BY AN "ACQUIRING PERSON",
AS SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT, WHETHER CURRENTLY HELD
BY OR ON BEHALF OF SUCH PERSON OR ANY SUBSEQUENT HOLDER) OR MAY BE
EVIDENCED BY SEPARATE CERTIFICATES AND MAY NO LONGER BE EVIDENCED BY THIS
CERTIFICATE. THE CORPORATION WILL MAIL OR ARRANGE FOR THE MAILING OF A COPY
OF THE RIGHTS AGREEMENT TO THE HOLDER OF THIS CERTIFICATE WITHOUT CHARGE AS
SOON AS IS PRACTICABLE AFTER THE RECEIPT OF A WRITTEN REQUEST THEREFOR.
Certificates representing Shares that are issued and outstanding at the
Record Time shall evidence one Right for each Share evidenced thereby,
notwithstanding the absence of the foregoing legend until the earlier of the
Separation Time and the Expiration Time.
2.2 EXECUTION, AUTHENTICATION, DELIVERY AND DATING OF RIGHTS CERTIFICATES
(a) The Rights Certificates shall be executed on behalf of the Corporation
by any of the Chairman of the Board, the President or the Chief
Executive Officer, together with any other of such persons or together
with any one of the Secretary, the Treasurer, any Assistant Secretary
or any Assistant Treasurer. The signature of any of the officers of
the Corporation on the Rights Certificates may be manual or facsimile.
Rights Certificates bearing the manual or facsimile signatures of
individuals who were at any time the proper officers of the
Corporation shall bind the Corporation, notwithstanding that such
individuals or any of them have ceased to hold such offices prior to
the countersignature and delivery of such Rights Certificates.
18
-17-
(b) Promptly after the Corporation learns of the Separation Time, the
Corporation will notify the Rights Agent of such Separation Time and
will deliver Rights Certificates executed by the Corporation to the
Rights Agent for countersignature, and the Rights Agent shall manually
countersign and deliver such Rights Certificates to the holders of the
Rights pursuant to subsection 3.1(c). No Rights Certificate shall be
valid for any purpose until countersigned by the Rights Agent as
aforesaid.
(c) Each Rights Certificate shall be dated the date of the
countersignature thereof.
2.3 REGISTRATION, REGISTRATION OF TRANSFER AND EXCHANGE
(a) After the Separation Time, the Corporation will cause to be kept a
register (the "RIGHTS REGISTER") in which, subject to such reasonable
regulations as it may prescribe, the Corporation will provide for the
registration and transfer of Rights. The Rights Agent is hereby
appointed the "RIGHTS REGISTRAR" for the purpose of maintaining the
Rights Register for the Corporation and registering Rights and
transfers of Rights as herein provided. In the event that the Rights
Agent shall cease to be the Rights Registrar, the Rights Agent will
have the right to examine the Rights Register at all reasonable times.
After the Separation Time and prior to the Expiration Time, upon
surrender for registration of transfer or exchange of any Rights
Certificate, and subject to the provisions of subsection (c) of this
section 2.3, the Corporation will execute, and the Rights Agent will
manually countersign and deliver, in the name of the holder or the
designated transferee or transferees, as required pursuant to the
holder's instructions, one or more new Rights Certificates evidencing
the same aggregate number of Rights as did the Rights Certificates so
surrendered.
(b) All Rights issued upon any registration of transfer or exchange of
Rights Certificates shall be valid obligations of the Corporation, and
such Rights shall be entitled to the same benefits under this
Agreement as the Rights surrendered upon such registration of transfer
or exchange.
(c) Every Rights Certificate surrendered for registration of transfer or
exchange shall be duly endorsed, or be accompanied by a written
instrument of transfer in form satisfactory to the Corporation or the
Rights Agent, as the case may be, duly executed by the holder thereof
or such holder's attorney duly authorized in writing. As a condition
to the issuance of any new Rights Certificate under this section 2.3,
the Corporation may require the payment of a sum sufficient to cover
any tax or other governmental charge that may be imposed in relation
thereto and any other expenses (including the fees and expenses of the
Rights Agent) in connection therewith.
19
- 18 -
2.4 MUTILATED, DESTROYED, LOST AND STOLEN RIGHTS CERTIFICATES
(a) If any mutilated Rights Certificate is surrendered to the Rights Agent
prior to the Expiration Time, the Corporation shall execute and the
Rights Agent shall manually countersign and deliver in exchange
therefor a new Rights Certificate evidencing the same number of Rights
as the Rights Certificate so surrendered.
(b) If there shall be delivered to the Corporation and the Rights Agent
prior to the Expiration Time: (i) evidence to their satisfaction of
the destruction, loss or theft of any Rights Certificate; and (ii)
such security or indemnity as may be required by them to save each of
them and any of their agents harmless, then, in the absence of notice
to the Corporation or the Rights Agent that such Rights Certificate
has been acquired by a bona fide purchaser, the Corporation shall
execute and upon its request the Rights Agent shall countersign and
deliver, in lieu of any such destroyed, lost or stolen Rights
Certificate, a new Rights Certificate evidencing the same number of
Rights as did the Rights Certificate so destroyed, lost or stolen.
(c) As a condition to the issuance of any new Rights Certificate under
this section 2.4, the Corporation may require the payment of a sum
sufficient to cover any tax or other governmental charge that may be
imposed in relation thereto and any other expenses (including the fees
and expenses of the Rights Agent) in connection therewith.
(d) Every new Rights Certificate issued pursuant to this section 2.4 in
lieu of any destroyed, lost or stolen Rights Certificate shall
evidence the contractual obligation of the Corporation, whether or not
the destroyed, lost or stolen Rights Certificate shall be at any time
enforceable by anyone, and shall be entitled to all the benefits of
this Agreement equally and proportionately with any and all other
Rights duly issued by the Corporation.
2.5 PERSONS DEEMED OWNERS OF RIGHTS
The Corporation, the Rights Agent and any agent of the Corporation or the
Rights Agent may deem and treat the Person in whose name such Rights Certificate
(or, prior to the Separation Time, the associated Share certificate) is
registered as the absolute owner thereof and of the Rights evidenced thereby,
for all purposes whatsoever. As used in this Agreement, unless the context
otherwise requires, the term "holder" of any Rights shall mean the registered
holder of such Rights (or, prior to the Separation Time, the associated Shares).
2.6 DELIVERY AND CANCELLATION OF CERTIFICATES
All Rights Certificates surrendered upon exercise or for redemption,
registration of transfer or exchange shall, if surrendered to any Person other
than the Rights Agent, be delivered to the Rights Agent and, in any case, shall
be promptly cancelled by the
20
- 19 -
Rights Agent. The Corporation may at any time deliver to the Rights Agent for
cancellation any Rights Certificates previously countersigned and delivered
hereunder which the Corporation may have acquired in any manner whatsoever, and
all Rights Certificates so delivered shall be promptly cancelled by the Rights
Agent. No Rights Certificate shall be countersigned in lieu of or in exchange
for any Rights Certificates cancelled as provided for in this section 2.6,
except as expressly permitted by this Agreement. The Rights Agent shall destroy
all cancelled Rights Certificates and deliver a certificate of destruction to
the Corporation.
2.7 AGREEMENT OF RIGHTS HOLDERS
Every holder of Rights by accepting the same consents and agrees with the
Corporation and the Rights Agent and with every other holder of Rights:
(a) to be bound by and subject to the provisions of this Agreement, as
amended from time to time in accordance with the terms hereof, in
respect of the Rights held;
(b) that prior to the Separation Time, each Right will be transferable
only together with, and will be transferred by a transfer of, the
associated Share certificate representing such Right;
(c) that after the Separation Time, the Rights Certificates will be
transferable only upon registration of the transfer on the Rights
Register as provided herein;
(d) that prior to due presentment of a Rights Certificate (or, prior to
the Separation Time, the associated Share certificate) for
registration of transfer, the Corporation, the Rights Agent and any
agent of the Corporation or the Rights Agent may deem and treat the
Person in whose name the Rights Certificate (or, prior to the
Separation Time, the associated Share certificate) is registered as
the absolute owner thereof and of the Rights evidenced thereby
(notwithstanding any notations of ownership or writing on such Rights
Certificate or the associated Share certificate made by anyone other
than the Corporation or the Rights Agent) for all purposes whatsoever,
and neither the Corporation nor the Rights Agent shall be affected by
any notice to the contrary;
(e) that such holder of Rights has waived his right to receive any
fractional Rights or any fractional Shares upon exercise of a Right
(except as provided herein);
(f) that without the approval of any holder of Rights and upon the sole
authority of the Board of Directors acting in good faith, this
Agreement may be supplemented or amended from time to time pursuant to
and as provided herein; and
21
- 20 -
(g) notwithstanding any contrary provision of this Agreement, neither the
Corporation nor the Rights Agent shall have any liability to any
holder of a Right or any other Person as a result of its inability to
perform any of its obligations under this Agreement by reason of any
preliminary or permanent injunction or other order, decree or ruling
issued by a court of competent jurisdiction or by a governmental,
regulatory or administrative agency or commission, or any statute,
rule, regulation or executive order promulgated or enacted by any
governmental authority, prohibiting or otherwise restraining
performance of such obligation.
2.8 RIGHTS CERTIFICATE HOLDER NOT DEEMED A SHAREHOLDER
No holder, as such, of any Right or Rights Certificate shall be entitled to
vote, receive dividends or be deemed for any purpose whatsoever the holder of
any Share which may at any time be issuable on the exercise of such Right, nor
shall anything contained herein or in any Rights Certificate be construed or
deemed to confer upon the holder of any Right or Rights Certificate, as such,
any of the rights, titles, benefits or privileges of a shareholder of the
Corporation or any right to vote at any meeting of shareholders of the
Corporation whether for the election of directors or otherwise or upon any
matter submitted to holders of any Shares at any meeting thereof, or to give or
withhold consent to any action of the Corporation, or to receive notice of any
meeting or other action affecting any shareholder of the Corporation except as
expressly provided herein, or to receive dividends, distributions or
subscription rights, or otherwise, until the Right or Rights evidenced by any
Rights Certificate shall have been duly exercised in accordance with the terms
and provisions hereof.
ARTICLE 3
EXERCISE OF THE RIGHTS
3.1 INITIAL EXERCISE PRICE, EXERCISE OF RIGHTS, DETACHMENT OF RIGHTS
(a) Subject to adjustment as herein set forth, from and after the
Separation Time and prior to the Expiration Time, each Right will
entitle the holder thereof to purchase one Common Share for the
Exercise Price (which Exercise Price and number of Common Shares are
subject to adjustment as set forth below).
(b) Until the Separation Time:
(i) the Rights shall not be exercisable and no Right may be
exercised; and
(ii) each Right will be evidenced by the certificate for the
associated Share registered in the name of the holder thereof
(which certificate shall also be deemed to be a Rights
Certificate) and will be transferable only together with, and
will be transferred by a transfer of, such associated Share.
22
- 21 -
(c) From and after the Separation Time and prior to the Expiration Time:
(i) the Rights shall be exercisable; and
(ii) the registration and transfer of the Rights shall be separate
from and independent of Shares.
Promptly following the Separation Time the Rights Agent will mail to each
holder of record of Shares as of the Separation Time or, in the case of
Conversion Shares issued after the Separation Time and prior to the close of
business on the eighth Trading Day following the Stock Acquisition Date,
promptly after such issue the Rights Agent will mail to the holders of the
Convertible Securities pursuant to which the Conversion Shares were issued
(other than to an Acquiring Person and other than, in respect of any Rights
Beneficially Owned by such Acquiring Person which are not held of record by such
Acquiring Person, to the holder of record of such Rights (a "NOMINEE")), at such
holder's address as shown on the records of the Corporation (and the Corporation
hereby agrees to furnish copies of such records to the Rights Agent for this
purpose):
(x) a Rights Certificate representing the number of Rights held by such
holder at the Separation Time, in substantially the form of Exhibit A
hereto, appropriately completed and having such marks of
identification or designation and such legends, summaries or
endorsements printed thereon as the Corporation may deem appropriate
and as are not inconsistent with the provisions of this Agreement, or
as may be required to comply with any law, rule, regulation or
judicial or administrative order or with any rule or regulation made
pursuant thereto or with any rule or regulation of any stock exchange
or quotation system on which the Rights may from time to time be
listed or traded, or to conform to usage; and
(y) a disclosure statement describing the Rights;
provided that a Nominee shall be sent the materials provided for in clauses (x)
and (y) only in respect of all Shares held of record by it which are not
Beneficially Owned by an Acquiring Person.
(d) Rights may be exercised in whole or in part on any Business Day after
the Separation Time and prior to the Expiration Time by submitting to
the Rights Agent:
(i) the Rights Certificate evidencing such Rights;
(ii) an election to exercise such Rights (an "ELECTION TO EXERCISE"),
substantially in the form attached to the Rights Certificate,
duly completed and executed by the holder or his executors or
administrators or other personal representatives or his or their
legal attorney duly appointed by an instrument in writing in form
and executed in a manner satisfactory to the Rights Agent; and
23
- 22 -
(iii) payment in cash, or by certified cheque, banker's draft or money
order payable to the order of the Rights Agent (on behalf of the
Corporation), of a sum equal to the applicable Exercise Price
multiplied by the number of Rights being exercised and a sum
sufficient to cover any transfer tax or charge which may be
payable in respect of any transfer involved in the transfer or
delivery of Rights Certificates or the issuance or delivery of
certificates for the relevant Shares in a name other than that of
the holder of the Rights being exercised.
(e) Upon receipt of the Rights Certificate which is accompanied by a
completed Election to Exercise that does not indicate that such Right
is null and void as provided by subsection 4.1(b) and payment as set
forth in subsection 3.1(d), the Rights Agent (unless otherwise
instructed by the Corporation in the event that the Corporation is of
the opinion that the Rights cannot be exercised in accordance with
this Agreement) will thereupon promptly:
(i) requisition from a transfer agent for the Common Shares,
certificates representing the number of such Common Shares to be
purchased (the Corporation hereby irrevocably authorizing its
transfer agents to comply with all such requisitions);
(ii) when appropriate, requisition from the Corporation the amount of
cash to be paid in lieu of issuing fractional Common Shares;
(iii) after receipt of such Common Share certificate, deliver the same
to or to the order of the registered holder of such Rights
Certificate, registered in such name or names as may be
designated by such holder;
(iv) when appropriate, after receipt, deliver such cash referred to in
clause (ii) above to or to the order of the registered holder of
the Rights Certificate; and
(v) tender to the Corporation all payments received on exercise of
the Rights.
(f) In case the holder of any Rights shall exercise less than all the
Rights evidenced by such holder's Rights Certificate, a new Rights
Certificate evidencing the Rights remaining unexercised will be issued
by the Rights Agent to such holder or to such holder's duly authorized
assigns.
(g) The Corporation covenants and agrees that it will:
(i) take all such action as may be necessary and within its power to
ensure that all Common Shares delivered upon exercise of Rights
shall, at the time of delivery of the certificates representing
such
24
- 23 -
Common Shares (subject to payment of the Exercise Price), be duly
and validly authorized, issued and delivered as fully paid and
non-assessable;
(ii) take all such actions as may be necessary and within its power to
comply with any applicable requirements of the Securities Act
(Ontario) and the securities act or comparable legislation of
each of the other provinces of Canada and any other applicable
law, rule or regulation, in connection with the issuance and
delivery of the Rights Certificates and the issuance of any
Common Shares upon exercise of Rights;
(iii) use reasonable efforts to cause all Common Shares issued upon
exercise of Rights to be listed on the principal exchanges on
which the Common Shares were traded immediately prior to the
Stock Acquisition Date;
(iv) cause to be reserved and kept available out of its authorized and
unissued Common Shares the number of Common Shares that, as
provided in this Agreement, will from time to time be sufficient
to permit the exercise in full of all outstanding Rights; and
(v) pay when due and payable any and all federal and provincial
transfer taxes (for greater certainty not including any income
taxes of the holder or exercising holder or any liability of the
Corporation to withhold tax) which may be payable in respect of
the original issuance or delivery of the Rights Certificates,
provided that the Corporation shall not be required to pay any
transfer tax or charge which may be payable in respect of any
transfer involved in the transfer or delivery of Rights
Certificates or the issuance or delivery of certificates for
Common Shares in a name other than that of the holder of the
Rights being transferred or exercised.
3.2 ADJUSTMENTS TO EXERCISE PRICE, NUMBER OF RIGHTS
The Exercise Price, the number of Common Shares or other securities subject
to purchase upon the exercise of each Right and the number of Rights outstanding
are subject to adjustment from time to time as provided in this section 3.2.
(a) If the Corporation shall at any time after the Record Time and prior
to the Expiration Time:
(i) declare or pay a dividend on its Shares payable in Shares (or
other securities exchangeable for or convertible into or giving a
right to acquire Shares) other than pursuant to any dividend
reinvestment program;
25
- 24 -
(ii) subdivide or change the outstanding Shares into a greater number
of Shares; or
(iii) combine or change the outstanding Shares into a smaller number
of Shares; or
(iv) issue any Shares (or other securities exchangeable for or
convertible into or giving a right to acquire Shares) in respect
of, in lieu of or in exchange for existing Shares,
the Exercise Price in effect at the time of the record date for such
dividend or of the effective date of such subdivision, combination or
other change, and the number of Shares or other securities, as the
case may be, issuable on such date, shall be proportionately adjusted
so that the holder of any Right exercised after such time shall be
entitled to receive, upon payment of the applicable Exercise Price
then in effect, the aggregate number of Common Shares or other
securities, as the case may be, which, if such Right had been
exercised immediately prior to such date and at a time when the share
transfer books of the Corporation were open, such holder would have
been entitled to receive as a result of such dividend, subdivision,
combination or reclassification.
(b) In case the Corporation shall at any time after the Record Time and
prior to the Expiration Time fix a record date for the issuance of
rights, options or warrants to all holders of Shares entitling them to
subscribe for or purchase (for a period expiring within 60 calendar
days after such record date) Common Shares (or shares having the same
rights, privileges and preferences as Common Shares ("equivalent
COMMON SHARES")) or securities convertible into Common Shares or
equivalent Common Shares at a price per Common Share or per equivalent
Common Share (or having a conversion price per share, if a security
convertible into Common Shares or equivalent Common Shares) less than
90% of the Market Price per Common Share on the second Trading Day
immediately preceding such record date, the Exercise Price in respect
of the Rights to be in effect after such record date shall be
determined by multiplying the Exercise Price in respect of the Rights
in effect immediately prior to such record date by a fraction: (i) the
numerator of which shall be the number of Common Shares outstanding on
such record date, plus the number of Common Shares that the aggregate
offering price of the total number of Common Shares and/or equivalent
Common Shares so to be offered (and/or the aggregate initial
conversion price of the convertible securities so to be offered) would
purchase at such Market Price per Common Share; and (ii) the
denominator of which shall be the number of Common Shares outstanding
on such record date, plus the number of additional Common Shares
and/or equivalent Common Shares to be offered for subscription or
purchase (or into which the convertible securities so to be offered
are initially convertible). In case such subscription price may be
26
- 25 -
paid by delivery of consideration, part or all of which may be in a
form other than cash, the value of such consideration shall be
determined in good faith by the Board of Directors, whose
determination shall be described in a statement filed with the Rights
Agent and shall be binding on the Rights Agent and the holders of the
Rights. Such adjustments shall be made successively whenever such a
record date is fixed and, in the event that such rights or warrants
are not so issued, the Exercise Price in respect of the Rights shall
be readjusted to be the Exercise Price which would then be in effect
if such record date had not been fixed.
(c) For purposes of this Agreement, the granting of the right to purchase
Common Shares (whether from treasury or otherwise) pursuant to a
dividend reinvestment plan or any employee benefit, stock option or
similar plans shall be deemed not to constitute an issue of rights,
options or warrants by the Corporation; provided, however, that in all
such cases the right to purchase Common Shares is at a price per share
that is not less than 90% of the current market price per share
(determined as provided in such plans) of the Common Shares.
(d) If the Corporation shall at any time after the Record Time and prior
to the Expiration Time fix a record date for a distribution to all
holders of Common Shares (including any such distribution made in
connection with a merger in which the Corporation is the continuing
corporation) of evidences of indebtedness or assets, including cash
(other than a dividend paid in the ordinary course or a dividend paid
in Common Shares, but including any dividend payable in securities
other than Common Shares), or subscription rights or warrants
entitling them to subscribe for or purchase Common Shares (excluding
those referred to in subsection 3.2(b)) at a price per Common Share
that is less than 90% of the Market Price per Common Share on the
second Trading Day immediately preceding such record date, the
Exercise Price in respect of the Rights to be in effect after such
record date shall be determined by multiplying the Exercise Price in
respect of the Rights in effect immediately prior to such record date
by a fraction: (i) the numerator of which shall be the Market Price
per Common Share on such record date, less the fair market value (as
determined in good faith by the Board of Directors, whose
determination shall be described in a statement filed with the Rights
Agent and shall be binding on the Rights Agent and the holders of the
Rights) of the portion of the cash, assets or evidences of
indebtedness so to be distributed or of such subscription rights or
warrants applicable to a Common Share; and (ii) the denominator of
which shall be such Market Price per Common Share. Such adjustments
shall be made successively whenever such a record date is fixed and,
in the event that such distribution is not so made, the Exercise Price
in respect of the Rights shall be adjusted to be the Exercise Price in
respect of the Rights which would have been in effect if such record
date had not been fixed.
27
- 26 -
(e) Notwithstanding anything herein to the contrary, no adjustment in the
Exercise Price shall be required unless such adjustment would require
an increase or decrease of at least 1% in such Exercise Price;
provided, however, that any adjustments which by reason of this
subsection 3.2(e) are not required to be made shall be carried forward
and taken into account in any subsequent adjustment. All calculations
under this section 3.2 shall be made to the nearest cent or to the
nearest ten-thousandth of a Common Share or other share, as the case
may be. Notwithstanding the first sentence of this subsection 3.2(e),
any adjustment required by this section 3.2 shall be made no later
than the earlier of (i) three years from the date of the transaction
giving rise to such adjustment and (ii) the Expiration Time.
(f) If, as a result of an adjustment made pursuant to section 4.1, the
holder of any Right thereafter exercised shall become entitled to
receive any shares other than Common Shares, thereafter the number of
such other shares so receivable upon exercise of any Right and the
applicable Exercise Price thereof shall be subject to adjustment from
time to time in a manner and on terms as nearly equivalent as is
practicable to the provisions with respect to the Common Shares
contained in this section 3.2, and the provisions of this Agreement
with respect to the Common Shares shall apply on like terms to any
such other shares.
(g) All Rights originally issued by the Corporation subsequent to any
adjustment made to the Exercise Price hereunder shall evidence the
right to purchase, at the adjusted Exercise Price, that number of
Common Shares purchasable from time to time hereunder upon exercise of
the Rights, all subject to further adjustment as provided herein.
(h) Unless the Corporation shall have exercised its election as provided
in subsection 3.2(i), upon each adjustment of the Exercise Price as a
result of the calculations made in subsections 3.2(b) and (d), each
Right outstanding immediately prior to the making of such adjustment
shall thereafter evidence the right to purchase, at the adjusted
Exercise Price, that number of Common Shares (calculated to the
nearest one ten-thousandth of a share) determined by:
(i) multiplying:
(A) the number of such Common Shares which would have been
issuable upon the exercise of a Right immediately prior to
this adjustment; by
(B) the Exercise Price in effect immediately prior to such
adjustment of the Exercise Price; and
28
- 27 -
(ii) dividing the product so obtained by the Exercise Price in effect
immediately after such adjustment of the Exercise Price.
(i) The Corporation may elect on or after the date of any adjustment of
the Exercise Price to adjust the number of Rights, in lieu of any
adjustment in the number of Common Shares purchasable upon the
exercise of a Right. Each of the Rights outstanding after the
adjustment in the number of Rights shall be exercisable for the number
of Common Shares for which such a Right was exercisable immediately
prior to such adjustment. Each Right held of record prior to such
adjustment of the number of Rights shall become that number of Rights
(calculated to the nearest one ten-thousandth) obtained by dividing
the Exercise Price in effect immediately prior to adjustment of the
Exercise Price by the Exercise Price in effect immediately after
adjustment of the Exercise Price. The Corporation shall make a public
announcement of its election to adjust the number of Rights,
indicating the record date for the adjustment, and, if known at the
time, the amount of the adjustment to be made. This record date may be
the date on which the Exercise Price is adjusted or any day
thereafter, but, if the Rights Certificates have been issued, shall be
at least 10 days later than the date of the public announcement. If
Rights Certificates have been issued, upon each adjustment of the
number of Rights pursuant to this subsection 3.2(i), the Corporation
shall, as promptly as is practicable, cause to be distributed to
holders of record of Rights Certificates on such record date, Rights
Certificates evidencing, subject to section 6.5, the additional Rights
to which such holders shall be entitled as a result of such
adjustment, or, at the option of the Corporation, shall cause to be
distributed to such holders of record in substitution and replacement
for the Rights Certificates held by such holders prior to the date of
adjustment, and upon surrender thereof, if required by the
Corporation, new Rights Certificates evidencing all the Rights to
which such holders shall be entitled after such adjustment. Rights
Certificates to be so distributed shall be issued, executed and
countersigned in the manner provided for herein and may bear, at the
option of the Corporation, the adjusted Exercise Price and shall be
registered in the names of holders of record of Rights Certificates on
the record date specified in the public announcement.
(j) Irrespective of any adjustment or change in the Exercise Price or the
number of Common Shares issuable upon the exercise of the Rights, the
Rights Certificates theretofore and thereafter issued may continue to
express the Exercise Price per Common Share and the number of Common
Shares which were expressed in the initial Rights Certificates issued
hereunder.
(k) In any case in which this section 3.2 shall require that an adjustment
in the Exercise Price be made effective as of a record date for a
specified event, the Corporation may elect to defer, until the
occurrence of such event, the
29
- 28 -
issuance to the holder of any Right exercised after such record date
of the number of Common Shares and other securities of the
Corporation, if any, issuable upon such exercise over and above the
number of Common Shares and other securities of the Corporation, if
any, issuable upon such exercise on the basis of the Exercise Price in
effect prior to such adjustment; provided, however, that the
Corporation shall deliver to such holder a due xxxx or other
appropriate instrument evidencing such holder's right to receive such
additional Common Shares (fractional or otherwise) or other securities
upon the occurrence of the event requiring such adjustment.
(l) Notwithstanding anything in this section 3.2 to the contrary, the
Corporation shall be entitled to make such reductions in the Exercise
Price in addition to those adjustments expressly required by this
section 3.2, as and to the extent that in its good faith judgment the
Board of Directors shall determine to be advisable in order that any:
(i) consolidation or subdivision of Common Shares; (ii) issuance
wholly for cash of any Common Share or securities that by their terms
are convertible into or exchangeable for Common Shares; (iii) stock
dividends; or (iv) issuance of rights, options or warrants referred to
in this section 3.2, hereafter made by the Corporation to holders of
its Common Shares, shall not be taxable to such shareholders.
(m) The Corporation covenants and agrees that, after the Separation Time,
it will not, except as permitted by section 6.1, 6.2 or 6.6, take (or
permit any Subsidiary of the Corporation to take) any action if at the
time such action is taken it is reasonably foreseeable that such
action will diminish substantially or otherwise eliminate the benefits
intended to be afforded by the Rights.
(n) Whenever an adjustment to the Exercise Price is made pursuant to this
Section 3.2, the Corporation shall: (i) promptly prepare a certificate
setting forth such adjustment and a brief statement of the facts
accounting for such adjustment; and (ii) promptly file with the Rights
Agent and with each transfer agent for the Common Shares a copy of
such certificate and mail a brief summary thereof to each holder of
Rights. Failure to file such certificate or cause such summary to be
mailed as aforesaid, or any defect therein, shall not affect the
validity of any such adjustment or change.
3.3 DATE ON WHICH EXERCISE IS EFFECTIVE
Each Person in whose name any certificate for Common Shares is issued upon
the exercise of Rights shall for all purposes be deemed to have become the
holder of record of the Common Shares represented thereby on, and such
certificate shall be dated, the date upon which the Rights Certificate
evidencing such Rights was duly surrendered (together with a duly completed
Election to Exercise) and payment of the Exercise Price for such Rights (and any
applicable transfer taxes and other
30
- 29 -
governmental charges payable by the exercising holder hereunder) was made;
provided, however, that if the date of such surrender and payment is a date upon
which the relevant Common Share transfer books of the Corporation are closed,
such Person shall be deemed to have become the holder of record of such Common
Shares on, and such certificate shall be dated, the next succeeding Business Day
on which the relevant Common Share transfer books of the Corporation are open.
ARTICLE 4
ADJUSTMENTS TO THE RIGHTS IN THE EVENT OF CERTAIN TRANSACTIONS
4.1 FLIP-IN EVENT
(a) Subject to subsection 4.1(b) and sections 6.1 and 6.2, if prior to the
Expiration Time a Flip-in Event shall occur, each Right shall
constitute, effective on and after the later of its date of issue and
the close of business on the eighth Trading Day following the Stock
Acquisition Date, the right to purchase from the Corporation, upon
payment of the Exercise Price and otherwise exercising such Right in
accordance with the terms hereof, that number of Common Shares having
an aggregate Market Price on the date of consummation or occurrence of
such Flip-in Event equal to twice the Exercise Price for an amount in
cash equal to the Exercise Price (such right to be appropriately
adjusted in a manner analogous to the applicable adjustments provided
for in section 3.2 upon each occurrence after the Stock Acquisition
Date of any event analogous to any of the events described in section
3.2).
(b) Notwithstanding anything in this Agreement to the contrary, upon the
occurrence of any Flip-in Event, any Rights that are or were
Beneficially Owned on or after the earlier of the Separation Time and
the Stock Acquisition Date by: (i) an Acquiring Person (or any
Affiliate or Associate of an Acquiring Person or any Person acting
jointly or in concert with an Acquiring Person or any Affiliate or
Associate of an Acquiring Person); or (ii) a transferee or other
successor in title, directly or indirectly, (a "TRANSFEREE") of Rights
held by an Acquiring Person (or any Affiliate or Associate of an
Acquiring Person or any Person acting jointly or in concert with an
Acquiring Person or any Affiliate or Associate of an Acquiring Person)
who becomes a Transferee concurrently with or subsequent to the
Acquiring Person becoming an Acquiring Person in a transfer that the
Board of Directors has determined is part of a plan, arrangement or
scheme of an Acquiring Person (or any Affiliate or Associate of an
Acquiring Person or any Person acting jointly or in concert with an
Acquiring Person or any Affiliate or Associate of an Acquiring
Person), that has the purpose or effect of avoiding clause 4.1(b)(i),
shall become null and void without any further action, and any holder
of such Rights (including any Transferee) thereafter shall not have
any right whatsoever to exercise such Rights under any provision of
this Agreement and shall
31
- 30 -
not have any other rights whatsoever with respect to such Rights,
whether under any provision of this Agreement or otherwise.
(c) Any Rights Certificate that represents Rights Beneficially Owned by a
Person described in clause 4.1(b)(i) or (ii) or transferred to any
nominee of any such Person, and any Rights Certificate issued upon
transfer, exchange, replacement or adjustment of any such Rights
Certificate, shall contain the following legend:
"The Rights represented by this Rights Certificate were
Beneficially Owned by a Person who was an Acquiring Person or who
was an Affiliate or an Associate of an Acquiring Person (as such
terms are defined in the Rights Agreement) or was acting jointly
or in concert with any of them. This Rights Certificate and the
Rights represented hereby shall become void in the circumstances
specified in section 4.1(b) of the Rights Agreement."
Notwithstanding the foregoing, the Rights Agent shall not be
responsible to ascertain the existence of facts that would require the
inclusion of such legend on any Rights Certificate but shall be
required to impose such legend only if instructed to do so by the
Corporation or if a holder fails to certify upon a transfer or
exchange of Rights, in the space provided therefor on the Rights
Certificate, that such holder is not an Acquiring Person or an
Affiliate or Associate thereof.
(d) If there shall not be sufficient Common Shares authorized for issuance
to permit the exercise in full of the Rights in accordance with this
section 4.1, the Corporation shall take all such action as may be
necessary to authorize additional Common Shares for issuance upon the
exercise of the Rights.
(e) From and after the Separation Time, the Corporation shall do all such
acts and things as shall be necessary and within its power to ensure
compliance with the provisions of this section 4.1 including, without
limitation, all such acts and things as may be required to satisfy the
requirements of the Securities Act (Ontario) or comparable legislation
of any other applicable jurisdiction in respect of the issue of Common
Shares upon the exercise of Rights in accordance with this Agreement.
ARTICLE 5
THE RIGHTS AGENT
5.1 GENERAL
(a) The Corporation hereby appoints the Rights Agent to act as agent for
the Corporation and the holders of Rights in accordance with the terms
and
32
- 31 -
conditions hereof, and the Rights Agent hereby accepts such
appointment. The Corporation may from time to time appoint such one or
more Co-Rights Agents as it may deem necessary or desirable. In the
event the Corporation appoints one or more Co-Rights Agents, the
respective duties of the Rights Agent and Co-Rights Agents shall be as
the Corporation may determine with the prior consent of the Rights
Agent and the Co-Rights Agents. The Corporation agrees to pay to the
Rights Agent reasonable compensation for all services rendered by it
hereunder and, from time to time, on demand of the Rights Agent, its
reasonable expenses and counsel fees and other disbursements
reasonably incurred in the execution and administration of this
Agreement and the exercise and performance of its duties hereunder
(including the reasonable fees and other disbursements of any expert
retained by the Rights Agent with the approval of the Corporation,
such approval not to be unreasonably withheld). The Corporation also
agrees to indemnify the Rights Agent, its directors, officers,
employees and agents for, and to hold each of them harmless against,
any loss, liability, cost, claim, action, damage or expense, incurred
without negligence, bad faith or wilful misconduct on the part of the
Rights Agent or its directors, officers, employees or agents, for
anything done, suffered or omitted by the Rights Agent in connection
with the acceptance, execution and administration of this Agreement
and the exercise and performance of its duties hereunder, including
the costs and expenses of defending against any claim of liability,
which right to indemnification will survive the termination of this
Agreement or the resignation or removal of the Rights Agent.
(b) The Rights Agent shall be protected and shall incur no liability for
or in respect of any action taken, suffered or omitted by it in
connection with its administration of this Agreement in reliance upon
any certificate for Shares, Rights Certificate, certificate for other
securities of the Corporation, instrument of assignment or transfer,
power of attorney, endorsement, affidavit, letter, notice, direction,
consent, certificate, statement or other paper or document believed by
it to be genuine and to be signed, executed and, where necessary,
verified or acknowledged, by the proper Person or Persons.
(c) The Corporation shall inform the Rights Agent in a reasonably timely
manner of events that may materially affect the administration of this
Agreement by the Rights Agent and at any time, upon request, shall
provide to the Rights Agent an incumbency certificate with respect to
the then current directors of the Corporation.
5.2 MERGER, AMALGAMATION OR CHANGE OF NAME OF RIGHTS AGENT
(a) Any corporation into which the Rights Agent or any successor Rights
Agent may be merged or amalgamated or with which it may be
consolidated, or any corporation resulting from any merger,
amalgamation
33
- 32 -
or consolidation to which the Rights Agent or any successor Rights
Agent is a party, or any corporation succeeding to the shareholder or
stockholder services business of the Rights Agent or any successor
Rights Agent, will be the successor to the Rights Agent under this
Agreement without the execution or filing of any paper or any further
act on the part of any of the parties hereto, provided that such
corporation would be eligible for appointment as a successor Rights
Agent under the provisions of section 5.4 hereof. In case at the time
such successor Rights Agent succeeds to the agency created by this
Agreement any of the Rights Certificates have been countersigned but
not delivered, any such successor Rights Agent may adopt the
countersignature of the predecessor Rights Agent and deliver such
Rights Certificates so countersigned; and in case at that time any of
the Rights Certificates have not been countersigned, any successor
Rights Agent may countersign such Rights Certificates either in the
name of the predecessor Rights Agent or in the name of the successor
Rights Agent; and in all such cases such Rights Certificates will have
the full force provided in the Rights Certificates and in this
Agreement.
(b) In case at any time the name of the Rights Agent is changed and at
such time any of the Rights Certificates shall have been countersigned
but not delivered, the Rights Agent may adopt the countersignature
under its prior name and deliver Rights Certificates so countersigned;
and in case at that time any of the Rights Certificates shall not have
been countersigned, the Rights Agent may countersign such Rights
Certificates either in its prior name or in its changed name; and in
all such cases such Rights Certificates shall have the full force
provided in the Rights Certificates and in this Agreement.
5.3 DUTIES OF RIGHTS AGENT
The Rights Agent undertakes the duties and obligations imposed by this
Agreement upon the following terms and conditions, by all of which the
Corporation and the holders of Rights Certificates, by their acceptance thereof,
shall be bound:
(a) the Rights Agent may consult with legal counsel (who may be legal
counsel for the Corporation) and the opinion of such counsel will be
full and complete authorization and protection to the Rights Agent as
to any action taken or omitted by it in good faith and in accordance
with such opinion; the Rights Agent may also, with the approval of the
Corporation (such approval not to be unreasonably withheld) and at the
expense of the Corporation, consult with such other experts as the
Rights Agent shall consider necessary or appropriate to properly carry
out the duties and obligations imposed under this Agreement and the
Rights Agent shall be entitled to rely in good faith on the advice of
any such expert;
(b) whenever in the performance of its duties under this Agreement the
Rights Agent deems it necessary or desirable that any fact or matter
be proved or
34
- 33 -
established by the Corporation prior to taking or suffering any action
hereunder, such fact or matter (unless other evidence in respect
thereof be herein specifically prescribed) may be deemed to be
conclusively proved and established by a certificate signed by a
Person believed by the Rights Agent to be the Chairman of the Board,
the President or any Vice-President and by the Treasurer or any
Assistant-Treasurer or the Secretary or any Assistant-Secretary of the
Corporation and delivered to the Rights Agent, and such certificate
shall be full authorization to the Rights Agent for any action taken
or suffered in good faith by it under the provisions of this Agreement
in reliance upon such certificate;
(c) the Rights Agent will be liable hereunder only for its own negligence,
bad faith or willful misconduct;
(d) the Rights Agent will not be liable for or by reason of any of the
statements of fact or recitals contained in this Agreement or in the
certificates for Shares or the Rights Certificates (except its
countersignature thereof) or be required to verify the same, but all
such statements and recitals are and will be deemed to have been made
by the Corporation only;
(e) the Rights Agent will not be under any responsibility in respect of
the validity of this Agreement or the execution and delivery hereof
(except the due authorization, execution and delivery hereof by the
Rights Agent) or in respect of the validity or execution of any Share
certificate or Rights Certificate (except its countersignature
thereof); nor will it be responsible for any breach by the Corporation
of any covenant or condition contained in this Agreement or in any
Rights Certificate, nor will it be responsible for any change in the
exercisability of the Rights (including the Rights becoming void
pursuant to subsection 4.1(b)) or any adjustment required under the
provisions of section 3.2 or responsible for the manner, method or
amount of any such adjustment or the ascertaining of the existence of
facts that would require any such adjustment (except with respect to
the exercise of Rights after receipt of the certificate contemplated
by section 3.2 describing any such adjustment); nor will it by any act
hereunder be deemed to make any representation or warranty as to the
authorization of any Common Shares to be issued pursuant to this
Agreement or any Rights or as to whether any Shares will, when issued,
be duly and validly authorized, executed, issued and delivered as
fully paid and non-assessable;
(f) the Corporation agrees that it will perform, execute, acknowledge and
deliver or cause to be performed, executed, acknowledged and delivered
all such further and other acts, instruments and assurances as may
reasonably be required by the Rights Agent for the carrying out or
performing by the Rights Agent of the provisions of this Agreement;
35
- 34 -
(g) the Rights Agent is hereby authorized and directed to accept
instructions with respect to the performance of its duties hereunder
from any Person believed by the Rights Agent to be the Chairman of the
Board, the President, the Chief Executive Officer, the Chief Operating
Officer, the Chief Financial Officer, any Vice-President, the
Secretary, any Assistant-Secretary, the Treasurer or any
Assistant-Treasurer of the Corporation, and to apply to such Persons
for advice or instructions in connection with its duties, and it shall
not be liable for any action taken or suffered by it in good faith in
reliance upon and in accordance with the instructions of any such
Person; such instructions to the Rights Agent shall, except where
circumstances make it impracticable or the Rights Agent otherwise
agrees, be given in writing and, where not in writing, such
instructions shall be confirmed in writing as soon as reasonably
practicable after the giving of such instructions;
(h) the Rights Agent and any shareholder or stockholder, director, officer
or employee of the Rights Agent may buy, sell or deal in Shares,
Rights or other securities of the Corporation or become pecuniarily
interested in any transaction in which the Corporation may be
interested, or contract with or lend money to the Corporation or
otherwise act as fully and freely as though it were not the Rights
Agent under this Agreement; nothing herein shall preclude the Rights
Agent from acting in any other capacity for the Corporation or for any
other legal entity; and
(i) the Rights Agent may execute and exercise any of the rights or powers
hereby vested in it or perform any duty hereunder either itself or by
or through its attorneys or agents, and the Rights Agent will not be
answerable or accountable for any act, default, neglect or misconduct
of any such attorneys or agents or for any loss to the Corporation
resulting from any such act, default, neglect or misconduct, provided
reasonable care was exercised in the selection and continued
employment thereof.
5.4 CHANGE OF RIGHTS AGENT
The Rights Agent may resign and be discharged from its duties under this
Agreement upon 60 days' notice in writing (or such lesser notice as is
acceptable to the Corporation) mailed to the Corporation and to each transfer
agent of Shares by registered or certified mail, and to the holders of the
Rights in accordance with section 6.9. The Corporation may remove the Rights
Agent upon 30 days' notice in writing given to the Rights Agent and to each
transfer agent of the Shares by personal delivery or by registered or certified
mail, and to the holders of the Rights in accordance with section 6.9. If the
Rights Agent should resign or be removed or otherwise become incapable of
acting, the Corporation will appoint a successor to the Rights Agent. If the
Corporation fails to make such appointment within a period of 30 days after such
removal or after it has been notified in writing of such resignation or
incapacity by the resigning or incapacitated Rights Agent then the resigning
Rights Agent or any holder of any Rights may apply to any court of competent
jurisdiction at the expense of the Corporation for
36
- 35 -
the appointment of a new Rights Agent. Any successor Rights Agent, whether
appointed by the Corporation or by such a court, shall be a corporation
incorporated under the laws of Canada or a province thereof authorized to carry
on the business of a trust company in the Province of Ontario. After
appointment, the successor Rights Agent will be vested with the same powers,
rights, duties and responsibilities as if it had been originally named as Rights
Agent without further act or deed; but the predecessor Rights Agent shall, upon
reimbursement of any expenses owing by the Corporation to the predecessor Rights
Agent under this Agreement, deliver and transfer to the successor Rights Agent
any property at the time held by it hereunder and execute and deliver any
further assurance, conveyance, act or deed necessary for the purpose. Not later
than the effective date of any such appointment, the Corporation will file
notice thereof in writing with the predecessor Rights Agent and each transfer
agent of the Shares, and mail a notice thereof in writing to the holders of the
Rights. Failure to give any notice provided for in this section 5.4, however, or
any defect therein, shall not affect the legality or validity of the resignation
or removal of the Rights Agent or the appointment of the successor Rights Agent,
as the case may be.
ARTICLE 6
MISCELLANEOUS
6.1 REDEMPTION OF RIGHTS
(a) Until the occurrence of a Flip-in Event, as to which the application
of section 4.1 has not been waived pursuant to section 6.2, the Board
of Directors:
(i) may, at any time prior to the Separation Time, with the prior
consent of the holders of Shares given in accordance with
subsection 6.6(e), or
(ii) may, at any time after the Separation Time, with the prior
consent of the holders of Rights given in accordance with
subsection 6.6(f),
elect to redeem all but not less than all of the then outstanding
Rights at a redemption price of $0.001 per Right, appropriately
adjusted in a manner analogous to the applicable adjustment provided
for in section 3.2, if an event of the type analogous to any of the
events described in section 3.2 shall have occurred (such redemption
price being herein referred to as the "REDEMPTION PRICE").
(b) If a Person acquires, pursuant to a Permitted Bid or a Competing
Permitted Bid or pursuant to an Exempt Acquisition occurring under
subsection 6.2(b), outstanding Shares, other than Shares Beneficially
Owned at the date of such Permitted Bid, Competing Permitted Bid or
Exempt Acquisition by such Person, the Board of Directors of the
Corporation shall immediately upon such acquisition and without
further formality be deemed to have elected to redeem the Rights at
the Redemption Price.
(c) Where a Take-over Bid that is not a Permitted Bid or Competing
Permitted Bid expires, is withdrawn or otherwise terminated
after the Separation Time has occurred and prior to the
occurrence of a Flip-in Event, the Board of Directors may
elect to redeem all of the outstanding Rights at the
Redemption Price.
(d) If the Board of Directors elects to redeem or is deemed to
have elected to redeem the Rights, (i) the right to exercise
the Rights will thereupon, without further
37
- 36 -
action and without notice, terminate and the only right thereafter of
the holders of Rights shall be to receive the Redemption Price, and
(ii) subject to subsection 6.1(f), no further Rights shall thereafter
be issued.
(e) Within 10 Business Days after the Board of Directors elects or is
deemed to have elected to redeem the Rights, the Corporation shall
give notice of redemption to the holders of the then outstanding
Rights by mailing such notice to each such holder at his last address
as it appears upon the Rights Register of the Rights Agent, or, prior
to the Separation Time, on the share register maintained by the
Corporation's transfer agent or transfer agents. Each such notice of
redemption shall state the method by which the payment of the
Redemption Price shall be made.
(f) Upon the Rights being redeemed pursuant to subsection 6.1(c), all
the provisions of this Agreement shall continue to apply as if the
Separation Time had not occurred and as if Rights Certificates
representing the number of Rights held by each holder of record of
Common Shares as of the Separation Time had not been mailed to each
such holder, and for all purposes of this Agreement the Separation
Time shall be deemed not to have occurred.
6.2 WAIVER OF FLIP-IN EVENTS
(a) With the prior consent of the holders of Shares obtained in
accordance with subsection 6.6(b), the Board of Directors may, at any
time prior to the occurrence of a Flip-in Event that would occur by
reason of an acquisition of Common Shares (other than pursuant to a
Take-over bid made by means of a take-over bid circular to all holders
of record of Shares or other than in the circumstances set forth in
subsection 6.2(c)), waive the application of section 4.1 to such
Flip-in Event by written notice delivered to the Rights Agent. In such
event, the Board of Directors shall extend the Separation Time to a
date at least 10 Business Days after the meeting of shareholders
called to approve such waiver.
38
- 37 -
(b) The Board of Directors may, at any time prior to the occurrence of a
Flip-in Event that would occur as a result of a Take-over Bid made by
way of a take-over bid circular sent to all holders of record of
Shares, waive the application of section 4.1 to such Flip-in Event by
written notice delivered to the Rights Agent, provided, however, that
if the Board of Directors waives the application of section 4.1 to
such a Flip-in Event, the Board of Directors shall be deemed to have
waived the application of section 4.1 to any other Flip-in Event
occurring by reason of any Take-over Bid which is made by means of a
take-over bid circular to all holders of record of Shares prior to the
expiry of any Take-over Bid in respect of which a waiver is, or is
deemed to have been, granted under this subsection 6.2(b).
(c) The Board of Directors may waive the application of section 4.1 to a
Flip-in Event provided that the following conditions are satisfied:
(i) the Board of Directors has determined that the Acquiring Person
became an Acquiring Person by inadvertence and without any
intention to become, or knowledge that it would become, an
Acquiring Person; and
(ii) such Acquiring Person has reduced its Beneficial Ownership of
Shares such that at the time of the waiver pursuant to this
subsection 6.2(c), it is no longer an Acquiring Person.
6.3 EXPIRATION
No Person shall have any rights pursuant to this Agreement or in respect of
any Right after the Expiration Time, except the Rights Agent as specified in
section 5.1.
6.4 ISSUANCE OF NEW RIGHTS CERTIFICATES
Notwithstanding any of the provisions of this Agreement or of the Rights to
the contrary, the Corporation may, at its option, issue new Rights Certificates
evidencing Rights in such form as may be approved by the Board of Directors to
reflect any adjustment or change in the number or kind or class of shares
purchasable upon exercise of Rights made in accordance with the provisions of
this Agreement.
6.5 FRACTIONAL RIGHTS AND FRACTIONAL SHARES
(a) The Corporation shall not be required to issue fractions of Rights or
to distribute Rights Certificates which evidence fractional Rights. In
lieu of such fractional Rights, there shall be paid to the registered
holders of the Rights Certificates with regard to which such
fractional Rights would otherwise be issuable, an amount in cash equal
to the fraction of the Market Price of a whole Right that the fraction
of a Right which would otherwise be issuable is of one whole Right.
39
- 38 -
(b) The Corporation shall not be required to issue fractions of Common
Shares upon exercise of the Rights or to distribute certificates which
evidence fractional Common Shares. In lieu of issuing fractional
Common Shares, the Corporation shall pay to the registered holders of
Rights Certificates, at the time such Rights are exercised as herein
provided, an amount in cash equal to the same fraction of the Market
Price of a whole Common Share that the fraction of a Common Share
which would otherwise be issuable upon the exercise of such right is
of one whole Common Share at the date of such exercise.
6.6 Supplements and Amendments
(a) The Corporation may from time to time prior to or after the Separation
Time supplement or amend this Agreement without the approval of any
holders of Rights or Shares in order to correct any clerical or
typographical error or to maintain the validity and effectiveness of
this Agreement as a result of any change in applicable laws, rules or
regulatory requirements. Notwithstanding anything in this section 6.6
to the contrary, no such supplement or amendment shall be made to the
provisions or Article 5 except with the written concurrence of the
Rights Agent to such supplement or amendment.
(b) Subject to subsection 6.6(a), the Corporation may, with the prior
consent of the holders of Rights or Shares obtained as set forth
below, at any time prior to the Separation Time, amend, vary or
rescind any of the provisions of this Agreement and the Rights
(whether or not such action would materially adversely affect the
interests of the holders of Rights generally) in order to effect any
amendments, variations or rescissions of any of the provisions of this
Agreement which the Board of Directors, acting in good faith,
considers necessary or desirable.
(c) Subject to subsection 6.6(a), the Corporation may, with the prior
consent of the holders of Rights obtained as set forth below, at any
time after the Separation Time and prior to the Expiration Time,
amend, vary or rescind any of the provisions of this Agreement and the
Rights (whether or not such action would materially adversely affect
the interests of the holders of Rights generally); provided that no
such amendment, variation or deletion shall be made to the provisions
of Article 5 except with the written concurrence of the Rights Agent
thereto. Such consent shall be deemed to have been given if the action
requiring such approval is authorized by the affirmative vote of a
majority of the votes cast by the holders of Rights (other than any
holder of Rights whose Rights have become null and void pursuant to
the provisions hereof) present or represented at and entitled to vote
at a meeting of the holders of Rights. For the purposes hereof the
procedures for the calling, holding and conduct of a meeting of the
holders of Rights shall be those, as nearly as may be, which are
provided in the
40
- 39 -
Corporation's by-laws with respect to meetings of its shareholders and
each Right shall be entitled to one vote at any such meeting.
(d) Any amendments made by the Corporation to this Agreement pursuant to
subsection 6.6(a) which are required to maintain the validity and
effectiveness of this Agreement as a result of any change in any
applicable laws, rules or regulatory requirements shall:
(i) if made before the Separation Time, be submitted to the holders
of Shares at the next meeting of holders of Shares and the
holders of Shares may, voting as set forth below, confirm or
reject such amendment; and
(ii) if made after the Separation Time, be submitted to the holders of
Rights (voting as set forth below) for confirmation or rejection.
Any such amendment shall, unless the Board of Directors otherwise
stipulates, be effective from the date of the resolution of the Board
of Directors adopting such amendment, until it is confirmed or
rejected or until it ceases to be effective (as described in the next
sentence) and, where such amendment is confirmed, it shall continue in
effect in the form so confirmed. If such amendment is rejected by the
holders of Shares or the holders of Rights or is not submitted to the
holders of Shares or holders of Rights as required, then such
amendment shall cease to be effective from and after the termination
of the meeting at which it was rejected or to which it should have
been but was not submitted or, if such a meeting of the holders of
Rights is not called within 90 days, at the end of such period, and no
subsequent resolution of the Board of Directors to amend this
Agreement to substantially the same effect shall be effective until
confirmed by the holders of Shares or holders of Rights as the case
may be.
(e) Any approval of the holders of Shares required under this Agreement
shall be deemed to have been given if the action requiring such
approval is approved by (i) affirmative votes of the holders of Shares
present or represented in person or by proxy at a meeting of such
holders duly held in accordance with applicable laws and the by-laws
of the Corporation or (ii) a written instrument signed by holders of
more than 50% of the outstanding Shares held by Independent
Shareholders.
(f) Any approval of the holders of Rights required under this Agreement
shall be deemed to have been given if the action requiring such
approval is authorized by the affirmative votes of the holders of
Rights present or represented at and entitled to be voted at a meeting
of the holders of Rights and representing a majority of the votes cast
in respect thereof. For the purposes hereof, each outstanding Right
(other than Rights which are void pursuant to the provisions hereof)
shall be entitled to one vote,
41
- 40 -
and the procedures for the calling, holding and conduct of the meeting
shall be those, as nearly as may be, which are provided in the
Corporation's by-laws, the OBCA and any other applicable law, rule or
regulation with respect to meetings of shareholders of the
Corporation.
6.7 RIGHTS OF ACTION
Subject to the terms of this Agreement, all rights of action in respect of
this Agreement, other than rights of action vested solely in the Rights Agent,
are vested in the respective holders of the Rights; and any holder of any
Rights, without the consent of the Rights Agent or of the holder of any other
Rights, may, on such holder's own behalf and for such holder's own benefit and
the benefit of other holders of Rights, enforce, and may institute and maintain
any suit, action or proceeding against the Corporation to enforce, or otherwise
act in respect of, such holder's right to exercise such holder's Rights in the
manner provided in such holder's Rights Certificate and in this Agreement.
Without limiting the foregoing or any remedies available to the holders of
Rights, it is specifically acknowledged that the holders of Rights would not
have an adequate remedy at law for any breach of this Agreement and will be
entitled to specific performance of the obligations of, and injunctive relief
against actual or threatened violations of the obligations of, any Person
subject to this Agreement.
6.8 NOTICE OF PROPOSED ACTIONS
In case the Corporation shall propose after the Separation Time and prior
to the Expiration Time:
(a) to effect or permit (in cases where the Corporation's permission is
required) any Flip-in Event; or
(b) to effect the liquidation, dissolution or winding-up of the
Corporation or the sale of all or substantially all of the
Corporation's assets;
then, in each such case, the Corporation shall give to each holder of a Right,
in accordance with section 6.9, a notice of such proposed action, which shall
specify the date on which such Flip-in Event, liquidation, dissolution or
winding-up is to take place, and such notice shall be so given at least 20
Business Days prior to the date of taking such proposed action.
6.9 NOTICES
Notices or demands authorized or required by this Agreement to be given or
made by the Rights Agent or by the holder of any Rights to or on the Corporation
shall be sufficiently given or made if delivered or sent by first-class mail,
postage prepaid, addressed (until another address is filed in writing with the
Rights Agent) as follows:
00
- 00 -
Xxxxxxxx Xxxxx Xxxxxxx xx Xxxxxx
000 Xxxxxxxxxx Xxxxxx
00xx Xxxxx,
Xxxxxxx, Xxxxxxx, Xxxxxx
X0X 0X0
Attention: Senior Manager, Client Services
Any notice or demand authorized or required by this Agreement to be given or
made by the Corporation or by the holder of any Rights to or on the Rights Agent
shall be sufficiently given or made if delivered or sent by first-class mail,
postage prepaid, addressed (until another address is filed in writing with the
Corporation) as follows:
Goldcorp Inc.
Xxxxx 0000
000 Xxxx Xxxxxx Xxxx
Xxxxxxx, Xxxxxxx, Xxxxxx
X0X 0X0
Attention: Chairman
Notices or demands authorized or required by this Agreement to be given or made
by the Corporation or the Rights Agent to or on the holder of any Rights shall
be sufficiently given or made if delivered or sent by first-class mail, postage
prepaid, addressed to such holder at the address of such holder as it appears
upon the registry books of the Rights Agent or, prior to the Separation Time, on
the registry books of the Corporation for the Shares. Any notice which is mailed
in the manner herein provided shall be deemed given, whether or not the holder
receives the notice.
6.10 COSTS OF ENFORCEMENT
The Corporation agrees that if it or any other Person the securities of
which are purchasable upon exercise of Rights fails to fulfil any of its
obligations pursuant to this Agreement, then the Corporation or such Person will
reimburse the holder of any Rights for the costs and expenses (including legal
fees) incurred by such holder in actions to enforce his rights pursuant to any
Rights or this Agreement.
6.11 SUCCESSORS
All the covenants and provisions of this Agreement by or for the benefit of
the Corporation or the Rights Agent shall bind and enure to the benefit of their
respective successors and assigns hereunder.
6.12 BENEFITS OF THIS AGREEMENT
Nothing in this Agreement shall be construed to give to any Person other
than the Corporation, the Rights Agent and the holders of the Rights any legal
or equitable
43
- 42 -
right, remedy or claim under this Agreement, and this Agreement
shall be for the sole and exclusive benefit of the Corporation, the Rights Agent
and the holders of the Rights.
6.13 GOVERNING LAW
This Agreement and each Right issued hereunder shall be deemed to be a
contract made under the laws of the Province of Ontario and for all purposes
shall be governed by and construed in accordance with the laws of such province
applicable to contracts to be made and performed entirely within such province.
6.14 COUNTERPARTS
This Agreement may be executed in any number of counterparts and each of
such counterparts shall for all purposes be deemed to be an original, and all
such counterparts shall together constitute one and the same instrument.
6.15 SEVERABILITY
If any section, subsection, clause, subclause, term or provision hereof or
the application thereof to any circumstance shall, in any jurisdiction and to
any extent, be invalid or unenforceable, such section, subsection, clause,
subclause, term or provision shall be ineffective as to such jurisdiction to the
extent of such invalidity or unenforceability without invalidating or rendering
unenforceable the remaining sections, subsections, clauses, subclauses, terms
and provisions hereof or the application of such section, subsection, clause,
subclause, term or provision to circumstances other than those as to which it is
held invalid or unenforceable.
6.16 EFFECTIVE DATE
This Agreement is in full force and effect in accordance with its terms
from the date hereof.
6.17 DETERMINATIONS AND ACTIONS BY THE BOARD OF DIRECTORS
Except as provided otherwise herein, the Board of Directors shall have the
exclusive power and authority to administer this Agreement in accordance with
the terms hereof. All actions, calculations and determinations (including any
omissions with respect thereto) made or done by the Board of Directors in good
faith shall not subject the Board of Directors, or any director of the
Corporation, to any liability to the holders of Rights.
6.18 TIME OF THE ESSENCE
Time shall be of the essence in this Agreement.
44
- 43 -
6.19 REGULATORY APPROVALS
Any obligation of the Corporation or action contemplated by this Agreement
shall be subject to the receipt of any requisite approval or consent from any
applicable regulatory authority including, without limiting the generality of
the foregoing, any necessary approvals of The Toronto Stock Exchange.
IN WITNESS WHEREOF the parties hereto have caused this Agreement to be duly
executed as of the date first above written.
GOLDCORP INC.
by: ______________________________________________
Authorized Officer
MONTREAL TRUST COMPANY OF CANADA
by: ______________________________________________
Authorized Officer
45
- 44 -
EXHIBIT A
FORM OF RIGHTS CERTIFICATE
Certificate
No. Rights
_________________________ _________________________
RIGHTS CERTIFICATE
This certifies that ________________ is the registered holder of the number of
Rights set forth above, each of which entitles the registered holder thereof,
subject to the terms, provisions and conditions of the Shareholder Rights Plan
Agreement, as the same may be amended or supplemented from time to time, made as
of the 1st day of November, 2000 (the "Rights Agreement") between Goldcorp Inc.,
a corporation amalgamated and existing under the laws of the Province of Ontario
(the "Corporation") and Montreal Trust Company of Canada, a trust company
existing under the laws of Canada, as rights agent (the "Rights Agent", which
term shall include any successor Rights Agent under the Rights Agreement) to
purchase from the Corporation at any time after the Separation Time and prior to
the Expiration Time (as such terms are defined in the Rights Agreement), one
fully paid common share of the Corporation (a "Common Share") at the Exercise
Price referred to below, upon presentation and surrender of this Rights
Certificate together with the Form of Election to Exercise and Declaration of
Ownership duly executed and submitted to the Rights Agent at its principal
office in any of the cities of Vancouver, Calgary, Xxxxxx, Winnipeg, Toronto,
Montreal and Halifax. The Exercise Price shall initially be $50.00 per Common
Share and shall be subject to adjustment in certain events as provided in the
Rights Agreement.
This Rights Certificate is subject to all of the terms, provisions and
conditions of the Rights Agreement which terms, provisions and conditions are
hereby incorporated herein by reference and made a part hereof and to which
Rights Agreement reference is hereby made for a full description of the rights,
limitations of rights, obligations, duties and immunities thereunder of the
Rights Agent, the Corporation and the holders of the Rights Certificates. Copies
of the Rights Agreement are on file at the registered office of the Corporation
and are available upon written request.
This Rights Certificate, with or without other Rights Certificates, upon
surrender at any of the offices of the Rights Agent designated for such purpose,
may be exchanged for another Rights Certificate or Rights Certificates of like
tenor and date evidencing an aggregate number of Rights equal to the aggregate
number of Rights evidenced by the Rights Certificate or Rights Certificates
surrendered. If this Rights Certificate shall be exercised in part, the
registered holder shall be entitled to receive,
46
- 45 -
upon surrender hereof, another Rights Certificate or Rights Certificates for the
number of whole Rights not exercised.
Subject to the provisions of the Rights Agreement, the Rights evidenced by
this Rights Certificate (i) may be, and under certain circumstances are required
to be, redeemed by the Corporation at a redemption price of $0.001 per Right and
(ii) may be exchanged at the option of the Corporation for cash, debt or equity
securities or other assets of the Corporation.
No fractional Common Shares will be issued upon the exercise of any Right
or Rights evidenced hereby, but in lieu thereof a cash payment will be made, as
provided in the Rights Agreement.
No holder of this Rights Certificate, as such, shall be entitled to vote or
receive dividends or be deemed for any purpose the holder of Common Shares or of
any other shares of the Corporation which may at any time be issuable upon the
exercise hereof, nor shall anything contained in the Rights Agreement or herein
be construed to confer upon the holder hereof, as such, any of the rights of a
shareholder of the Corporation or any right to vote for the election of
directors or upon any matter submitted to shareholders of the Corporation at any
meeting thereof, or to give or withhold consent to any corporate action, or to
receive notice of meetings or other actions affecting shareholders of the
Corporation, or to receive dividends or subscription rights, or otherwise, until
the Rights evidenced by this Rights Certificate shall have been exercised as
provided in the Rights Agreement.
This Rights Certificate shall not be valid or obligatory for any purpose
until it shall have been manually countersigned by the Rights Agent.
WITNESS the facsimile signature of the proper officers of the Corporation
and its corporate seal.
Date: November o, 2000
GOLDCORP INC.
by: _________________________________________
by: _________________________________________
Countersigned:
MONTREAL TRUST COMPANY OF CANADA
by: _______________________________
Authorized Officer
47
- 46 -
FORM OF ELECTION TO EXERCISE
TO: MONTREAL TRUST COMPANY OF CANADA
The undersigned hereby irrevocably elects to exercise ___________________
whole Rights represented by the attached Rights Certificate to purchase the
Common Shares issuable upon the exercise of such Rights and requests that
certificates for such Common Shares be issued to:
Name
_________________________________________________________________
Address
_________________________________________________________________
City and Province
_________________________________________________________________
Social Insurance Number or other taxpayer identification number
If such number of Rights shall not be all the Rights evidenced by this
Rights Certificate, a new Rights Certificate for the balance of such Rights
shall be registered in the name of and delivered to:
Name
_________________________________________________________________
Address
_________________________________________________________________
City and Province
_________________________________________________________________
Social Insurance Number or other taxpayer identification number
Dated: _______________________________________________________________
Signature
Signature Guaranteed: ________________________________________________
(Signature must correspond to name as written upon the face of this Rights
Certificate in every particular, without alteration or enlargement or any change
whatsoever)
Signature must be guaranteed by a member firm of a recognized stock
exchange in Canada, a registered national securities exchange in the United
States, a member of the Investment Dealers Association of Canada or National
Association of Securities Dealers, Inc., or a commercial bank or trust company
having an office or correspondent in Canada or the United States.
48
- 47 -
(To be completed if true)
The undersigned hereby represents, for the benefit of the Corporation and all
holders of Rights and of shares of the Corporation, that the Rights evidenced by
this Rights Certificate are not, and, to the knowledge of the undersigned, have
never been, Beneficially Owned by an Acquiring Person or an Affiliate or
Associate thereof or any Person acting jointly or in concert with any of the
foregoing (as such terms are defined in the Rights Agreement).
Signature ____________________________
49
- 48 -
FORM OF ASSIGNMENT
FOR VALUE RECEIVED ________________________________________________________
(Please print name and address of transferee)
hereby sells, assigns and transfers unto ___________________________ the Rights
represented by this Rights Certificate, together with all right, title and
interest therein.
Dated: ____________________
Signature _____________________________________________
Signature Guaranteed:_______________________________________
(Signature must correspond to name as written upon the face of this Rights
Certificate in every particular, without alteration or enlargement or any change
whatsoever)
Signature must be guaranteed by a member firm of a recognized stock
exchange in Canada, a registered national securities exchange in the United
States, a member of the Investment Dealers Association of Canada or National
Association of Securities Dealers, Inc., or a commercial bank or trust company
having an office or correspondent in Canada or the United States.
(To be completed if true)
The undersigned hereby represents, for the benefit of the Corporation and all
holders of Rights and of shares of the Corporation, that the Rights evidenced by
this Rights Certificate are not, and, to the knowledge of the undersigned, have
never been, Beneficially Owned by an Acquiring Person or an Affiliate or
Associate thereof or any Person acting jointly or in concert with any of the
foregoing (as defined in the Rights Agreement).
Signature ______________________________________________
NOTICE
IN THE EVENT THE CERTIFICATION SET FORTH ABOVE IN THE FORMS OF ASSIGNMENT
AND ELECTION IS NOT COMPLETED, THE CORPORATION WILL DEEM THE BENEFICIAL OWNER OF
THE RIGHTS EVIDENCED BY THIS RIGHTS CERTIFICATE TO BE AN ACQUIRING PERSON OR AN
AFFILIATE OR ASSOCIATE THEREOF (AS DEFINED IN THE RIGHTS AGREEMENT) AND
ACCORDINGLY SUCH RIGHTS WILL BE NULL AND VOID.
